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CFTC Issues Fourth Extension of Inter-Affiliate Swap Clearing Exemption
Practical Law Legal Update w-004-8024 (Approx. 3 pages)
CFTC Issues Fourth Extension of Inter-Affiliate Swap Clearing Exemption
by Practical Law Finance
| Published on 01 Dec 2016 • USA (National/Federal) |
The CFTC issued two no-action letters further extending until December 31, 2017 previously granted relief from Dodd-Frank clearing and trade execution requirements for certain inter-affiliate swaps. The relief permits the continued use of alternatives to the "outward facing swaps condition" (OFSC) to qualify for the inter-affiliate exemption.
On November 28, 2016, the CFTC issued two no-action letters further extending previously granted relief from Dodd-Frank clearing and trade execution requirements for certain inter-affiliate swaps:
- No-Action Letter 16-81 (No-Action 16-81). No-Action 16-81 extends the relief granted in No-Action Letter 15-63 for certain affiliate entities from the outward-facing swaps condition (OFSC) in the inter-affiliate exemption. The relief permits eligible affiliates to continue using certain alternatives to the OFSC to qualify for the inter-affiliate exemption, subject to certain conditions. The relief is extended until the sooner of December 31, 2017 or 60 days after the CFTC has made a comparability determination described in CFTC Regulation 50.52(b)(4)(i). For further detail on the relief granted, see Legal Update, CFTC Provides Third Extension of Inter-Affiliate Swap Clearing Exemption.
- No-Action Letter 16-80 (No-Action 16-80). No-Action 16-80 extends the relief granted in No-Action Letter 15-62 for inter-affiliate swaps from the trade execution requirement under section 2(h)(8) of the Commodity Exchange Act (CEA). The relief is extended until December 31, 2017. For further detail on the relief granted, see Legal Update, CFTC Provides Third Extension of Inter-Affiliate Swap Clearing Exemption.
For more information on the inter-affiliate swap exemption, see Practice Note, The Dodd-Frank Act: Swap Clearing and Exchange Trading Under Title VII: Inter-affiliate Swap Exemption.