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Exemptive Letters

Date
Exemptive Letters
01/14/2003
03-09 PDF Image; Regulation 4.7(b)(4); Exemption
The Division of Clearing and Intermediary Oversight provided exemptive relief to CPOs X and Y, located in state A, from requirements of Rule 4.7(b)(4) that they maintain certain books and records at their main business office and in accordance with Rule. 1.31. An affiliate of X and Y, Z, will maintain the books and records at Z's main office in State B. Relief is subject to the conditions that: (1) X and Y notify the Division if the location of any of the required books and records changes from that as represented to the Division; (2) X and Y remain responsible for ensuring, among other things, that all of their required books and records are maintained in accordance with Rule 1.31 and for assuring the availability of the records to the Commission, NFA, or any other agency authorized to review such books and records. This exemption is further subject to the condition that X and Y remain responsible for compliance with Rule. 4.7(b)(4).
02/07/2003
03-10 PDF Image; Regulation 4.22; Exemption
The Division of Clearing and Intermediary Oversight provided exemptive relief to registered CPOs from the periodic and annual reporting requirements of Rule 4.22 in connection with their joint operation of master funds that have as their sole participants feeder funds or other master funds that are jointly operated by the CPOs or other CPOs with the same ownership and management. This relief is subject to, among other things: (1) the CPOs retaining identical ultimate ownership, officers and directors; (2) participation in the Master Funds being limited to the Feeder Funds, and any fund for which the CPOs are the sole CPOs; and (3) the annual reports of the Feeder Funds containing financial statements that include, among other information, the fees associated with the operation of the applicable Master Funds.
01/22/2003
03-11 PDF Image; Regulation 4.22; Exemption
The Division of Clearing and Intermediary Oversight provided exemptive relief to registered CPOs from the periodic and annual reporting requirements of Rule 4.22 in connection with their joint operation of a sub fund, that has as its sole participants two feeder funds that are jointly operated by the CPOs. The Division also confirmed that the exemption granted to the CPOs by prior no-action letters continues to apply with respect to the operation of the sub funds and feeder funds identified in the prior no-action letters. This relief is subject to the conditions that: (1) the CPOs remain the CPOs of the sub funds; (2) participation in the sub fund is limited to any fund for which the CPOs are the sole CPOs; and (3) the annual reports of the feeder funds contain financial statements that include, among other information, the fees associated with the operation of the sub funds in which they invest.
03/25/2003
03-14 PDF Image; Regulation 4.22; Exemption
The Division of Clearing and Intermediary Oversight provided exemptive relief to a registered CPO from the periodic and annual reporting requirements of Rule 4.22 in connection with its operation of a Master Fund that has as its sole participants four Feeder Funds that are also operated by the CPO. The relief is subject to the conditions that: (i) the CPO remain the CPO of the Master Fund and the Feeder Funds; (ii) participation in the Master Fund is limited to the Feeder Funds; and (iii) the annual reports of the Feeder Funds contain financial statements that include, among other information, the detailed income and fees associated with the operation of the Master Fund expressed in dollars.
04/01/2003
03-15 PDF Image; Rule 4.35(b); Exemption
A CTA operating two separate companies, whose trading was controlled by the same trading principal, requested an exemption from disclosing the past performance of both companies in each company's Disclosure Document. The exemption was denied based upon Rule 4.35(b)'s requirement that past performance of all accounts traded by a trading principal of the CTA must be disclosed in the Disclosure Document.
04/17/2003
03-21 PDF Image; Regulation 4.7(b)(1), 4.7(b)(2) and 4.7(b)(3); Exemption
The Division of Clearing and Intermediary Oversight provided exemptive relief to a registered CPO from the periodic and annual reporting requirements of Rules 4.7(b)(1), 4.7(b)(2) and 4.7(b)(3) in connection with its operation of a master fund that has as its sole participants feeder funds that are operated by the CPO. This relief is subject to, among other things: (1) participation in the master fund being limited to the feeder funds, and any fund for which the CPO is the sole CPO; and (2) the annual reports of the feeder funds containing financial statements that include, among other information, the fees associated with the operation of the master fund.
04/17/2003
03-22 PDF Image; Regulation 4.7(b)(1), 4.7(b)(2) and 4.7(b)(3); Exemption
The Division of Clearing and Intermediary Oversight provided exemptive relief to a registered CPO from the periodic and annual reporting requirements of Rules 4.7(b)(1), 4.7(b)(2) and 4.7(b)(3) in connection with its operation of a master fund that has as its sole participants feeder funds that are operated by the CPO. This relief is subject to, among other things: (1) participation in the master fund being limited to the feeder funds, and any fund for which the CPO is the sole CPO; and (2) the annual reports of the feeder fund containing financial statement that include, among other information, the fees associated with the operation of the master fund.
05/05/2003
03-23 PDF Image; Regulation 4.7(b)(1), 4.7(b)(2) and 4.7(b)(3); Exemption
The Division of Clearing and Intermediary Oversight provided exemptive relief to a registered CPO from the disclosure and periodic and annual reporting requirements of Rules 4.7(b)(1), 4.7(b)(2) and 4.7(b)(3) in connection with its operation of a master fund that has as its sole participants feeder funds that are operated by the CPO or another CPO with the same ownership and management. This relief is subject to, among other things: (1) the CPOs retaining identical management and ownership; (2) participation in the Master Fund being limited to the Feeder Funds, and any fund for which the CPOs are the sole CPOs; and (3) the annual reports of the Feeder Funds containing financial statements that include, among other information, the fees associated with the operation of the applicable Master Fund.
05/05/2003
03-24 PDF Image; Regulation 4.7(b)(2) and 4.7(b)(3); Exemption
The Division of Clearing and Intermediary Oversight provided exemptive relief to a registered CPO from the periodic and annual reporting requirements of Rules 4.7(b)(2) and 4.7(b)(3) in connection with its operation of a master fund that has as its sole participants a feeder fund that is operated by the CPO and a feeder fund that is operated by CPOs with the same ownership and management. This relief is subject to, among other things: (1) the CPOs retaining identical management and ownership; (2) participation in the Master Fund being limited to the Feeder Funds, and any fund for which the CPOs are the sole CPOs, and (3) the annual reports of the Feeder Funds containing financial statements that include, among other information, the fees associated with the operation of the applicable Master Fund.
07/16/2003
03-29 PDF Image; Rule 155.4(a); Exemption
The Division of Clearing and Intermediary Oversight denied relief to an Introducing Broker who wished to bunch proprietary orders with customer orders. The IB planned to use average pricing to allocate orders after execution. The Division stated that 155.4(a) mandates the Introducing Brokers use a "customer first" principle, therefore the IB's accounts must not be bunched with customer accounts.
07/16/2003
03-30 PDF Image; Rule 155.4(a); Exemption
The Division of Clearing and Intermediary Oversight denied relief to an Introducing Broker who wished to bunch proprietary orders with customer orders. The Division stated that 155.4(a) mandates that IBs use of "customer first" principle, therefore the IB's account must not be bunched with customer accounts.
08/13/2003
03-32 PDF Image; Regulation 4.7; Exemption
The Division of Clearing and Intermediary Oversight confirmed exemptive relief previously granted to a registered CPO from the disclosure document, periodic and annual reporting requirements of Rule 4.7 in connection with the operation of a master fund that previously had as its sole participants two feeder funds that are operated by the CPO and an affiliate of the CPO. The Division confirmed the prior exemption despite the fact that the CPO of the master fund had allowed two investors from the feeder funds to invest directly in the master fund, but provided them with disclosure document and periodic and annual financial reports required by Rule 4.7. This relief is subject to the condition that: (1) the CPO comply with all the conditions set forth in the previous exemptive letters (except that it may continue to allow the two investors to participate in the master fund); and (2) the CPO continue to provide periodic and annual financial reports to the two investors in accordance with the requirements of Rules 4.7(b)(2) and 4.7(b)(3).

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