CFTC Staff Letter 15-68: No-Action Relief for SEFs from Post-Trade Allocation Audit Trail Requirements

U.S. COMMODITY FUTURES TRADING COMMISSION
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CFTC Letter 15-68
No-Action
December 22, 2015
Division of Market Oversight
Re: No-Action Relief for Swap Execution Facilities from Certain Audit Trail Requirements in Commission Regulation 37.205 Related to Post-trade Allocation Information Ladies and Gentlemen:
This letter responds to a request received from multiple parties 1 by the Division of Market Oversight (the “Division”) of the Commodity Futures Trading Commission (the “Commission”) for no-action relief for swap execution facilities (“SEFs”) from certain of the requirements under Commission regulation 37.205 that require SEFs to capture post-trade allocation information in their audit trail data. Background Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) 2 amended the Commodity Exchange Act (“CEA”) 3 to establish a comprehensive new regulatory framework for swaps. CEA Section 5h provides that to be registered and maintain registration, a SEF must comply with fifteen enumerated core principles and any requirements that the Commission may impose by rule or regulation. 4 Among the core principle requirements for SEFs, Core Principle 2 5 requires a SEF to have the capacity to detect, investigate and enforce its rules, and to capture information that may be used in establishing whether violations of those rules have occurred.