On May 3, the Commodity Futures Trading Commission announced proposed rules amending its regulations regarding certain duties of chief compliance officers (CCOs) of swap dealers (SDs), major swap participants (MSPs) and futures commission merchants (FCMs; each, a Registrant). In addition, the proposed rules amend certain requirements for preparing and furnishing CCO annual reports on a Registrant’s compliance activities to the CFTC. Many of the changes seek to harmonize such regulations with the Securities and Exchange Commission’s parallel rules.
Among other changes, the proposed rules (1) clarify that CCOs are responsible for administering policies and procedures specifically related to a Registrant’s business as an SD, MSP and/or FCM (as applicable), and not all of a Registrant’s business that may otherwise be subject to CFTC regulation; (2) add a reasonableness standard to the steps a CCO must take to resolve certain conflicts of interest; and (3) make certain changes to the CCO annual report’s content and submission process. In addition, the proposed rules provide a definition of “senior officer” that is consistent with how the CFTC’s staff has generally interpreted that term in the past.
The comment period on the proposed rules will end 60 days after publication in the Federal Register.
The proposed rule filing is available here.