CFTC Staff Letter 95-77: No-Action Relief from CPO and CTA Registration for Puerto Rico Fund Directors and Adviser

DIVISION OF
TRADING AND MARKETS
COMMODITY FUTURES TRADING COMMISSION 2033 K Street, NW, Washington, DC 20581 (202) 254-8955 f202) 254- 8010 Facsimile July 10, 1995 Re: Section 4m(1) -- Request for Relief from Commodity Pool Operator and Commodity Trading Advisor Registration Dear This is in response to your letter dated April 20, 1995 to the Division of Trading and Markets ("Division") of the Commodity Futures Trading Commission ("Commission"), as supplemented by letters dated May 16, 1995 and May 31, 1995, and telephone conversations with Division staff. By your letter, as supplemented, you request that the Division grant: (1) the directors of (the "Fund"), a Puerto Rico commodity pool, relief from registration as commodity pool operators ("CPOs"); and (2) (the "Adviser"), the Fund's investment adviser, relief from registration as a commodity trading advisor ("CTA"). Based upon the representations made in your letter, as supplemented, we understand the pertinent facts to be as follows. The Fund is a non-diversified, open-end management investment company. At least seventy-five percent of the Fund's directors will have their principal residence in Puerto Rico and none of the Fund's directors will be subject to a statutory disqualification under Se9tion 8a(2) or 8a(3) of the Commodity Exchange Act (the "Act") .1./ The Fund will be registered under the laws of the Commonwealth of Puerto Rico pursua~t to the Puerto Rico Investment Companies Act (the "P.R. Act") .J./ In addition, y(Ou represent 1./ 7 U.S. C. § 12a ( 2) or 12a ( 3) ( 1994) . The Fund contemplates that it will have five directors. You represent that citizens of the United States who are not residents of Puerto Rico will comprise no more than twenty-five percent of the Fund's directors. Currently, the Fund's one director who is a resident of the United States is also an officer of the Adviser. A second director, a Puerto Rico resident, is an officer of the Fund's underwriter. J./ Our understanding of the operative provisions of the P.R. Act has been set forth in letters to you dated May 24, 1995 and February 8, 1995 (the "Letters") , wherein we issued relief from CPO (continued ... )