September 15, 2014

CFTC Staff Sets Forth Enabling Process for No-Action Relief with respect to Swaps Trading on Certain Financial Markets that are Licensed in Australia and Overseen by the Australian Securities & Investments Commission

Washington, DC — The U.S. Commodity Futures Trading Commission’s (CFTC) Divisions of Market Oversight (DMO) and Swap and Intermediary Oversight (DSIO) today announced the issuance of an enabling no-action letter for qualifying swaps trading platforms that are licensed in Australia and overseen by the Australian Securities & Investments Commission (Australian Licensed Markets).

This enabling no-action letter provides relief for:

  • Qualifying Australian Licensed Markets from the swap execution facility (SEF) registration requirement under section 5h(a)(1) of the Commodity Exchange Act (CEA);

  • Parties executing swap transactions on qualifying Australian Licensed Markets from the trade execution mandate under CEA section 2(h)(8); and

  • Swap dealers and major swap participants executing swap transactions on qualifying Australian Licensed Markets from certain requirements under the CFTC’s business conduct rules and for which these registrants otherwise would receive or be subject to similar regulatory treatment if executing swap transactions on SEFs.

An Australian Licensed Market must set forth in an undertaking that it will comply with the conditions in the letter. Relief will trigger after DMO reviews the applicant’s certification and issues a responsive relief letter.

This conditional no-action letter will expire upon the effective date of any final rules implementing the Commission’s authority, under CEA section 5h(g), to exempt facilities that are “subject to comparable, comprehensive supervision and regulation on a consolidated basis by . . . the appropriate governmental authorities in the home country of the facility” from the SEF registration requirement of CEA section 5h(a)(1) and Commission regulation 37.3(a)(1).

Separately, a similar enabling process is available to European multilateral trading facilities (MTFs). See CFTC No-Action Letter 14-46.

Last Updated: September 15, 2014