CFTC Staff Letter 13-73: Extension of No-Action Relief to Japan Securities Clearing Corporation and Qualifying Participants

U.S. COMMODITY FUTURES TRADING COMMISSION
Three Lafayette Centre
1155 21st Street, NW, Washington, DC 20581
Telephone: (202) 418-5000
Facsimile: (202) 418-5521 www.cftc.gov
Division of Clearing and
Risk
CFTC Letter No. 13-73
No-Action
December 19, 2013
Division of Clearing and Risk
Mr. Yasuo Tobiyama
President and CEO
Japan Securities Clearing Corporation
2-1 Nihombashi-Kabuto-cho
Chuo-Ku
Tokyo 103-0026
Japan
Re: Extension of Time-Limited No-Action Relief with Regard to Section 5b(a) of the Commodity Exchange Act and Section 2(h)(1)(A) of the Commodity Exchange Act and Implementing Regulations Thereunder Dear Mr. Tobiyama:
This is in response to your letter dated November 12, 2013 (the “Letter”) requesting that the Division of Clearing and Risk (“Division”) of the Commodity Futures Trading Commission (“Commission” or “CFTC”) extend to June 30, 2014 the no-action relief that the Division granted to Japan Securities Clearing Corporation (“JSCC”) in CFTC Letter 12-56 and that will expire on December 31, 2013 (the “No-Action Relief”). 1 In CFTC Letter 12-56, the Division stated that it would not recommend that the Commission take enforcement action against (i) JSCC for failure to register as a derivatives clearing organization (“DCO”) pursuant to the requirements of section 5b(a) of the Commodity Exchange Act (“CEA”), 2 or (ii) a JSCC qualified clearing participant, or a parent or affiliate of such clearing participant, for failure to clear certain yen-denominated interest rate swaps that are required to be cleared under section 2(h)(1)(A) of the CEA and Commission regulations, 3 through a registered DCO. On November 29, 2012, JSCC submitted a draft application for registration as a DCO. On January 29, 2013, JSCC submitted supplementary draft documents. On November 12, 2013, together with the Letter, JSCC submitted a revised draft application.