No-action relief for Chicago Mercantile Exchange regarding Regulation 1.20(g)(4) and exemption from Regulation 1.49(d)(3) for Bank of Canada accounts

U.S. COMMODITY FUTURES TRADING COMMISSION
Three Lafayette Centre
1155 21st Street, NW, Washington, DC 20581
Telephone: (202) 418-5044
Facsimile: (202) 418-5547 jbandman@cftc.gov
Jeffrey M. Bandman
Acting Director
Division of Clearing and Risk
CFTC Letter No. 16-59
No-Action; Exemption
Division of Clearing and Risk
Executive Director and Associate General Counsel CME Group 1 North End Avenue New York, NY 10282 RE: Request for No-Action Relief from the Written Acknowledgment Requirements of Commission Regulations 1.20(g) and 22.5 and for Exemptive Relief from Commission Regulation 1.49(d)(3) Dear Mr. Silverstein:
This is in response to your letter dated December 9, 2015 (“Letter”), to the Division of Clearing and Risk (“Division”) of the Commodity Futures Trading Commission (“Commission”). In the Letter, you request that the Division confirm that it will not recommend that the Commission take enforcement action against the Chicago Mercantile Exchange, Inc. (“CME”) for failing to obtain, or provide the Commission with, an executed version of the template acknowledgement letter set forth in Appendix B to Regulation 1.20 (“Template Acknowledgement Letter”), as required by Regulations 1.20(g)(4) and 22.5, for customer accounts maintained at the Bank of Canada (“BoC”). You additionally request that the Division grant exemptive relief from Regulation 1.49(d)(3)(i), with respect to CME’s holding of customer funds in the BoC, which is not a qualified depository for customer funds under the regulation.
I. No-Action Relief from the Written Acknowledgement Requirements in
Commission Regulations 1.20(g)(4) and 22.5
Regulations 1.20(g)(4) and 22.5 require, among other things, that a derivatives clearing organization (“DCO”) obtain a Template Acknowledgement Letter from a depository prior to or