Ownership and control reporting

The Division of Market Oversight of the Commodity Futures Trading Commission has extended no-action relief from certain of the CFTC’s ownership and control reporting (OCR) regulations, including electronic reporting via new Form 71, revised Form 40/40S and revised Form 102 (which includes Form 102A, Form 102B and Form 102S). CFTC Letter No. 15-03 replaces CFTC Letter No. 14-95, which previously granted similar relief. Specifically, CFTC Letter No. 15-03 provides temporary relief from the reporting requirements of (1) Form 102A and Form 102S until September 30, 2015, (2) Form 102B with respect to designated contract market volume threshold accounts until September 30, 2015, (3) Form 102B with respect to swap execution facility volume threshold accounts until February 13, 2017, and (4) Form 40/40S and Form 71 until February 11, 2016. To rely on this relief, market participants must continue to submit legacy Form 102, Form 102S and Form 40/40S, as applicable. Market … [Read more...] about CFTC Extends Relief From Certain Ownership and Control Reporting (OCR) Requirements

The Division of Market Oversight (DMO) and Division of Swap Dealer and Intermediary Oversight (DSIO) of the Commodity Futures Trading Commission have issued an advisory on ownership and control reporting (OCR) for futures commission merchants, clearing members, foreign brokers, swap dealers and certain reporting markets. In 2013, the CFTC adopted changes to its OCR requirements, including changes to OCR forms that identify market participants that own or control reportable positions in certain futures or swaps and provide detailed market participant data to the CFTC. CFTC staff have subsequently issued temporary no-action relief to extend the dates by which reporting parties must begin using the new OCR forms.DMO and DSIO have issued the advisory to remind reporting parties to obtain from their customers or counterparties information necessary to submit new Forms 102A, 102B and 102S once the temporary no-action relief has expired. DMO and DSIO recommend that reporting parties manage … [Read more...] about CFTC Issues Advisory on Ownership and Control Reporting

We all now realize that, contrary to the pronouncements of certain pundits, the world is not economically flat.  But it is undeniable that its citizens and businesses are more economically connected than ever before. One manifestation of this interconnectedness is the increasing number of cross-border acquisitions of business enterprises. In most cases these transactions do not become the subject of public discussion or detailed government scrutiny.  But when foreign entities seek to purchase U.S. government contractors who perform classified national security work and therefore hold facility security clearances (“FCLs”), the U.S. Government is anxious to know, among other things, the extent to which the company is the subject of foreign ownership, control or influence (“FOCI”).  Being under FOCI can sound the death knell for a company’s ability to perform classified work, with consequent loss of business that may be critical to … [Read more...] about Evaluating FOCI (Foreign Ownership, Control or Influence )In The Context Of An M&A Transaction

On October 30, the Commodity Futures Trading Commission approved final rules that implement position and trading activity based reporting requirements for market participants that trade futures and swaps. The final rules modify the existing Form 102 and 102S (Identification of “Special Accounts”) and Form 40 (Statement of Reporting Trader) and implement two new forms that will be used to identify and collect information related to accounts that exceed a specified daily trading volume. Under the final rules, these reports will be submitted to the CFTC electronically. Form 102A (revised Form 102) requires clearing members to identify special accounts (as defined in Part 15 of the CFTC Regulations) as well as the underlying trading accounts. Form 102S has been updated and will continue to be used to collect information related to certain categories of swaps. Form 102B is a new form that will be used by clearing members and certain reporting markets to identify accounts … [Read more...] about Commodity Futures Trading Commission (CFTC) Adopts Final Rules for Ownership and Control Reports

This month, CME Group announced fines totaling $1.75 million against derivatives broker Newedge USA for violations of exchange rules in certain metal markets over the course of two years.   Newedge agreed to the fine pursuant to an offer of settlement in which Newedge neither admitted nor denied the rule violations upon which the penalty was based.  Specifically, Panels for both the NYMEX Business Conduct Committee and the COMEX Business Conduct Committee found that Newedge violated exchange Rule 432, Rule 529, Legacy Rule 538.A, Legacy Rule 538.G, and Legacy Rule 538.H., while a clearing member of the exchange.According to the disciplinary action notices released by the exchange, on multiple occasions over a two year period, employees working for Newedge, but trading accounts of a Newedge affiliate, executed EFRPs as a counterparty with its customers that were not bona fide.  While trading in Gold and Silver futures, Newedge employees received orders from customers, … [Read more...] about Monthly Futures Exchange Issuance Report: February 2015