Exemption of Foreign Swap Trading Facilities from SEF Registration

Section 5h(a)(1) of the Commodity Exchange Act (CEA) prohibits the operation of a facility for the trading or processing of swaps unless the facility is registered as a swap execution facility (SEF) or as a designated contract market (DCM).

CEA section 5h(g) authorizes the Commission to grant an exemption from SEF registration if it determines that a foreign swap trading facility is subject to “comparable, comprehensive supervision and regulation on a consolidated basis” by the appropriate governmental authorities in the facility’s home country.

Foreign swap trading facilities that have been granted an exemption under CEA section 5h(g) can be used to execute swaps that are subject to the trade execution requirement under CEA section 2(h)(8). In addition, these “exempt SEFs” can offer trading in swaps that are not subject to the trade execution requirement to U.S. person counterparties that qualify as eligible contract participants.

An exemption under CEA section 5h(g) does not otherwise affect applicable requirements under the CEA and CFTC regulations.  In the CEA section 5h(g) exemptive orders that it has issued, the Commission has particularly highlighted certain requirements that continue to apply when transacting swaps on exempt SEFs.

Foreign Swap Trading Facilities Exempt from SEF Registration Requirement

The Commission has issued CEA section 5h(g) orders exempting from SEF registration certain swap trading facilities in the following jurisdictions:

European Union
Japan
Singapore

European Union

The following CEA section 5h(g) order, and amendment thereto, exempts certain multilateral trading facilities (MTFs) and organized trading facilities (OTFs) authorized in the European Union (EU) from SEF registration:

List of swap trading facilities within the EU covered by the Order of Exemption

Trading Facility Name

Category

(MTF or OTF)

Home Country

Bloomberg Multilateral Trading Facility Limited

MTF

United Kingdom

BGC Brokers LP

OTF

United Kingdom

Creditex Brokerage LLP

MTF

United Kingdom

Currenex

MTF

United Kingdom

Dowgate

MTF

United Kingdom

EBS MTF

MTF

United Kingdom

FX Connect

MTF

United Kingdom

GFI Brokers Limited

OTF

United Kingdom

ICAP Global Derivatives

MTF

United Kingdom

ICAP Securities

OTF

United Kingdom

ICAP WCLK

MTF

United Kingdom

iSWAP

MTF

United Kingdom

NEX SEF Limited

MTF

United Kingdom

Sunrise Brokers LLP

OTF

United Kingdom

Thomson Reuters

MTF

United Kingdom

Trad-X

MTF

United Kingdom

Tradeweb Europe Limited

MTF

United Kingdom

Tradition

OTF

United Kingdom

Tullett Prebon Europe

OTF

United Kingdom

Tullett Prebon Europe

MTF

United Kingdom

 

Japan

The following CEA section 5h(g) order exempts certain electronic trading platforms (ETPs) authorized in Japan from SEF registration:

List of swap trading facilities within Japan covered by the Order of Exemption

Trading Facility Name

Category

Home Country

BGC Shoken Kaisha Limited (Tokyo branch)

ETP

Japan

Bloomberg Tradebook Japan Ltd.

ETP

Japan

Clear Markets Japan Inc.

ETP

Japan

Totan ICAP Co., Ltd.

ETP

Japan

Tradeweb Japan Ltd.

ETP

Japan

Tullet Prebon ETP Japan Ltd.

ETP

Japan

Ueda Tradition Securities Ltd. ETP Japan

 

Singapore

The following CEA section 5h(g) order exempts certain approved exchanges (AEs) and recognised market operators (RMOs) authorized in Singapore from SEF registration:

List of swap trading facilities within Singapore covered by the Order of Exemption

Trading Facility Name

Category

(AE or RMO)

Home Country

Asia Pacific Exchange Pte Ltd.

AE

Singapore

Cleartrade Exchange Pte Ltd.

RMO

Singapore

ICE Futures Singapore Pte Ltd.

AE

Singapore

Singapore Exchange Derivatives Trading Limited

AE

Singapore

Tradition Singapore (Pte) Ltd

RMO

Singapore