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SIFMA’s Asset Management Group today released the following statement from Laura Martin, managing director and associate general counsel, after the U.S. Commodity Futures Trading Commission’s (CFTC) Division of Market Oversight (Division) announced a further extension of no-action relief from swap execution facility (SEF) trading requirements for certain swaps executed as part of a package transaction:
“SIFMA’s Asset Management Group welcomes the extension of no-action relief from trade execution requirements for certain swaps executed as part of a package transaction as an important step to avoid unnecessary, near-term disruptions to markets. While we support the transition of highly liquid, standardized swap trading to SEFs as a meaningful way to enhance transparency, liquidity and risk management, we are concerned that applying SEF trading mandates prematurely to trades or products like packages that lack deep liquidity or robust market infrastructure could have the opposite effect to the detriment of investors. We appreciate that the Division is taking time to further assess concerns regarding package transactions and urge the CFTC to provide permanent relief for these transactions. Specifically, we encourage the CFTC to make changes to Regulation 37.10’s made available to trade (MAT) determination process as outlined in our comment letter.”
