CFTC Staff Letter 14-155: Extension of No-Action Relief for JSCC DCO Registration and Clearing

The Division of Clearing and Risk extends no-action relief to Japan Securities Clearing Corporation (JSCC) until the earlier of its registration as a derivatives clearing organization or December 31, 2015. This relief exempts JSCC from enforcement action for failing to register as a DCO and exempts its qualified clearing participants from the requirement to clear Japanese yen-denominated interest rate swaps through a registered DCO. The exemption applies specifically to overnight index swaps, TIBOR-referencing swaps, and swaps covered by the Japanese Financial Instruments and Exchange Act, excluding swaps on behalf of U.S. customers. JSCC must report novated swaps to a Commission-registered swap data repository in accordance with Part 45 regulations.

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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. 14-155
No-Action
December 22, 2014
Division of Clearing and Risk
Mr. Hironaga Miyama
President and Chief Executive Officer
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 Sections 2(h)(1)(A) and 5b(a) of the Commodity Exchange Act and Implementing Regulations Thereunder Dear Mr. Miyama:
This is in response to your letter dated December 12, 2014 ( “Letter”) requesting that the Division of Clearing and Risk (“Division”) of the Commodity Futures Trading Commission (“Commission” or “CFTC”) extend to December 31, 2015 the no-action relief that the Division granted to Japan Securities Clearing Corporation (“JSCC”) in CFTC Letter 12-56, extended in CFTC Letter 13-73, and that will expire on December 31, 2014 (“No-Action Relief”). 1 In CFTC Letter 13-73, 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) any JSCC qualified clearing participant, or a parent or affiliate of such clearing participant, for failure to clear certain Japanese yen (“JPY”)-denominated interest rate swaps that are required to be cleared under Section 2(h)(1)(A) of the CEA and Commission regulations, through a registered DCO (“CEA Clearing Requirement”). 3

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

Source: Commodity Futures Trading Commission — original document · Summary generated with machine assistance and reviewed before publication; the authoritative text is the regulator's original document. How RegAlert works