Alert April 09, 2013

CFTC Provides Time-Limited No-Action Relief for Commodity Pool Operators of Securitization Vehicles

The CFTC’s Division of Swap Dealer and Intermediary Oversight (the “Division”) has issued a no-action letter that provides an extension for the deadline for commodity pool operators (“CPOs”) of securitization vehicles to register with the CFTC.  The letter provides that the Division will not recommend enforcement action against the CPO of a securitization vehicle for failure to fully comply with Part 4 of the CFTC’s regulations—the part of the CFTC’s regulations that generally regulates CPOs as well as commodity trading advisors—with respect to that securitization vehicle until June 30, 2013.

The relief is contingent on several conditions.  For example, persons that wish to take advantage of the relief must initiate registration as a CPO by March 31, 2013.  They must also comply with all the provisions of Part 4 of the CFTC’s regulations, subject to certain exceptions, exclusions, and limitations based, in some cases, on the characteristics of the commodity pool.  Those availing themselves of the relief must also notify the Division via e-mail.

The letter indicates that it is intended to cover securitization vehicles that do not satisfy the conditions and criteria set forth in CFTC Staff Letter No. 12-14 or CFTC Staff Letter No. 12-45 (discussed in the October 16, 2012 and December 11, 2012 editions of the Financial Services Alert, respectively), which collectively provided that operators of securitization vehicles meeting certain enumerated criteria need not register as CPOs.  The latter letter gave CPOs of securitization vehicles that could not satisfy the requirements of either letter until March 31, 2013 to register; the newest CFTC letter extends that deadline subject to the terms and conditions described above.