CFTC Staff Letter 10-19: No-Action Relief from CPO Registration for General Partner

U.S. COMMODITY FUTURES TRADING COMMISSION
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Facsimile: (202) 418-5547 aradhakrishnan@cftc.gov Division of Clearing and Intermediary Oversight Ananda Radhakrishnan Director CFTC Letter No. 10-19 No-Action May 5, 2010 Division of Clearing and Intermediary Oversight Re: Section 4m(1) – Request for CPO Registration Relief Dear :
This is in response to your letter dated February 16, 2010, to the Division of Clearing and Intermediary Oversight (the “Division”) of the Commodity Futures Trading Commission (the “Commission” or “CFTC”), as supplemented by your e-mail message sent March 25, 2010 and telephone conversations with Division staff (collectively, the “correspondence”). By the correspondence, you seek relief on behalf of “A” from the requirement to register with the Commission as a commodity pool operator (“CPO”) under Section 4m(1) of the Commodity Exchange Act (the “Act”)1 in connection with serving as the general partner of the Pool, such that “B”, a registered CPO, may serve as the Pool's CPO instead. Based upon the representations made in the correspondence, we understand the facts to be as follows: The Pool is organized as a limited partnership. While “A” is its general partner, “A” has delegated all of its management authority with respect to the Pool to “B”, the Pool's investment manager and a registered CPO. As is explained in the correspondence, this structure is intended to facilitate the favorable tax treatment of performance allocations to “A”.2