The U.S. Commodity Futures Trading Commission’s (Commission) Division of Swap Dealer and Intermediary Oversight (DSIO) today issued a no-action letter for commodity pool operators (CPOs) of certain commodity pools that are non-registered investment companies (Parent Pools) that use wholly-owned trading subsidiaries to trade commodity interests (Trading Subsidiaries). In the letter, DSIO does not recommend that the Commission take an enforcement action against a CPO for failure to provide the following:
- A separate annual report for a Parent Pool’s Trading Subsidiary to the National Futures Association (NFA) pursuant to Commission regulation 4.7(b) or 4.22(c), as applicable; and
- A separate CPO-PQR report for a Parent Pool’s Trading Subsidiary to NFA pursuant to Commission regulation 4.27(c).
This relief is dependent on:
- The CPO of the Parent Pool being the CPO of the Trading Subsidiary;
- The exposure to the Trading Subsidiary by the participants in its Parent Pool being shared pro rata;
- The CPO consolidating the reporting under Commission regulation 4.7(b) or 4.22(c), as applicable, and Commission regulation 4.27(c) for the Trading Subsidiary with those of its Parent Pool; and
The CPO claiming the relief through notice
DSIO has previously issued similar relief to CPOs of registered investment companies that utilize controlled foreign corporations in CFTC Staff Letter No. 13-51. This letter essentially expands the class of commodity pools for which a CPO may consolidate annual reports and CPO-PQR reports.
- RELATED LINKS
- CFTC Staff Letter 14-112
