CFTC Staff Letter 93-49: No-Action Relief for Unregistered General Partner of Commodity Pool

COMMODITY FllTURES TRADING COMMISSION 2033 K Street,NW, Washington, DC 20581 (202} 254 -8955 (202) 254- 8010 Facsimile q~-1? DIVISION OF . TRADING AND MARKETS May 21, 1993 r ~ N "' en Re: Request for CPO Registration Relief il Dear f:i This is in response to your letter to the Division of Trad￾ing and Markets ("Division") dated April 27, 1993, as supple- mented by telephone conversations with Division staff, wherein you request that the Division not recommend that the Commission take any enforcement action against A for failure to register as a commodity pool operator ("CPO") in connection with its serving as a general partner of the Fund. Based upon your letter, as supplemented, we understand the facts to be as follows. You and A will act as co-general partners of the Fund. You are a registered CPO and commodity trading advisor and the sole owner and president of A. Inasmuch as A will be a general partner of the Fund, it also will be serving as a CPO of the Fund and, absent relief, must register as a CPO. In support of the instant request, you have provided the Division with a written acknowl~dgment whereby you accept joint and several liability for any violation of the Commodity Exchange Act (the "Act•) or Commission regulations thereunder committed by A in connection with its serving as a CPO of the Fund. Accordingly, in light of this acknowledgment and the fact that you are a registered CPO and the sole owner of A, the Division will not recommend that the Commission take any enforcement action against A for its failure to register as a CPO in connection with its serving as a general partner of the Fund. This position is, however, subject to tl1e conditions that A will not exercise discretion, supervision or control over or take part in: (1) the solicitation, acceptance or receipt of funds or property to be used for purchasing interests in the Fund, or (2) the investment, use or other disposition of funds or property o~ the Fund. We note that A remains subject to the anti-fraud prov1s1ons of Section 4Q of the Act, 7 U.S.C. §6Q (1988), as amended by the

• __/ Futures Trading Practices Act of 1992, Pub. L. No. 102-546, 106
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Stat. 3590 (October 28, 1992}, and to all otherwise applicable provisions of the Act and the Commission's regulations thereunder, ~. the reporting requirements for traders set forth in Parts 15, 18 and 19 of the regulations and Rules 4.20 and 4.41, which apply to each person who comes within the CPO definition, regardless of registration status. Moreover, the position which we have taken herein is solely applicable to A in connection with its serving as a CPO of the Fund. The position taken in this letter is based upon the rep￾resentations that have been made to us and is subject to com￾pliance with the conditions set forth above. Any different, changed or omitted facts or conditions might require us to reach a different conclusion. In this connection, we request that you notify us immediately in the event that the activities of the Fund or A change in any way from those as represented to us. Further, this letter represents the position of the Division of Trading and Markets only. It does not necessarily represent the views of the Commission or any other office or division of the Commission. If you have any questions concerning this correspondence please contact me or Mary Cademartori, an attorney on my staff, at (202) 254-8955. MC/mc Very truly yours, Susan c. Ervin Chief Counsel