CFTC Staff Letter 16-07: No-Action Relief from CPO and CTA Registration for Board of Trustees of Pension Plan Group Trust

Division of Swap Dealer and Eileen T. Flaherty Intermediary Oversight Director U.S. COMMODITY FUTURES TRADING COMMISSION Three Lafayette Centre 1155 21st Street, NW, Washington, DC 20581 Telephone: (202) 418-6700 Facsimile: (202) 418-5528 eflaherty@cftc.gov CFTC Letter No.16-07 No-Action January 13, 2016 Division of Swap Dealer and Intermediary Oversight RE: No-Action Relief from Commodity Pool Operator and Commodity Trading Advisor Registration for the Board of Trustees of “A” Dear :
This is in response to your request submitted to the Division of Swap Dealer and Intermediary Oversight (“Division”) of the Commodity Futures Trading Commission (“Commission”) on August 25, 2015, (the “Correspondence”), on behalf of the Board of Trustees (“Trustees”)1 of “A”. In the Correspondence, you request that the Division not recommend that the Commission take an enforcement action, pursuant to Section 4m(1) of the Commodity Exchange Act (“CEA”),2 against the Trustees for failure to register with the Commission as a commodity pool operator (“CPO”) or commodity trading advisor (“CTA”), with respect to their activities operating “A”. In particular, you request relief comparable to that provided by Regulations 4.5 and 4.6, notwithstanding that a pension plan group trust is not a “qualifying entity” under Regulation 4.5.3 Background In the Correspondence, you make the following representations. “A” was organized pursuant to a Trust Agreement entered into by “B” and “C”. “A” is a commingled trust established under IRS Revenue Ruling 81-100.4 As noted above, the same individuals that serve as Trustees of “A” also make up the Boards of Trustees of “B” and “C”. 1 The same individuals that serve as Trustees of “A” also make up the Boards of Trustees of those two underlying participating plans. Therefore, in this letter, the term “Trustees” will refer to those individuals regarding both their actions with respect to “A’s” participating plans, as well as their request for relief from registration and regulatory obligations stemming from the Trustees’ operation of “A”. 2 7 U.S.C. 6m(1). 3 17 CFR 4.5 and 4.6. 4 IRS Revenue Ruling 81-100 establishes the requirements that must be met by qualified retirement plans and individual account retirement plans to pool their assets in a group trust for investment purposes.