CFTC Extends Compliance Dates For End User Swap Reporting

The CFTC has issued a no-action letter that effectively extends the dates for swap counterparties who are not swap dealers (SDs) or major swap participants (MSPs) to come into compliance with the agency’s reporting rules under Part 43 (real-time reporting), Part 45 (swap data reporting), and Part 46 (“historical swap” reporting) of its regulations. Prior to the no-action letter, such non-SD/MSP counterparties were required to comply with such regulations beginning tomorrow, April 10. In the no-action letter, the CFTC Division of Market Oversight states that it will not recommend that the Commission take enforcement action against parties failing to comply with such requirements until certain later dates that depend on the type of swap and type of counterparty to the swap, effectively extending the compliance dates.

New Compliance Dates for Non-Financial Swap Counterparties
The no-action letter defines “non-financial swap counterparties” as non-SD/MSP counterparties who are also not “financial entities” under Section 2(h)(7)(c) of the Commodity Exchange Act (i.e., not SDs, MSPs, security-based SDs, major security-based swap participants, commodity pools, private funds, employee benefit plans, or person predominantly engaged in activities that are in the business of banking or in activities that are financial in nature). The swap reporting compliance dates for non-financial swap counterparties are extended as follows:

(i) For interest rate swaps and credit swaps, non-financial swap counterparties are not required to be in compliance with the Part 43 (real-time) or Part 45 (swap data) requirements until 12:01 a.m. eastern time on July 1, 2013—on condition that, by 12:01 a.m. eastern time on August 1, 2013, the non-financial swap counterparty “backload” and report to a swap data repository (SDR) all transaction data for the period from April 10, 2013, to July 1, 2013 that the non-financial swap counterparty would have been required to report pursuant to Part 45 in the absence of the no-action relief;

(ii) For “other commodity” swaps (including energy, agricultural, and metals swaps), equity swaps, and foreign exchange swaps, non-financial swap counterparties are not required to be in compliance with the Part 43 (real-time) or Part 45 (swap data) requirements until 12:01 a.m. eastern time on August 19, 2013—on condition that, by 12:01 a.m. eastern time on September 19, 2013, the non-financial swap counterparty “backload” and report to an SDR all transaction data, for the period from April 10, 2013, to August 19, 2013, that the non-financial swap counterparty would have been required to report pursuant to Part 45 in the absence of the no-action relief;

(iii) For all swap asset classes, non-financial swap counterparties are not be required to be in compliance with the Part 46 (historical swap) requirements until 12:01 a.m. eastern time on October 31, 2013. “Historical swaps” will still only include swaps entered into prior to 12:01 a.m. on April 10, 2013.

New Compliance Dates for Financial Swap Counterparties
For “financial swap counterparties,” i.e., non-SD/MSP counterparties who are “financial entities” under Section 2(h)(7)(C) of the CEA, the swap reporting compliance dates are extended as follows:

(i) For interest rate swaps and credit swaps, the compliance date for financial swap counterparties remains April 10, 2013;

(ii) For “other commodity” swaps, equity swaps, and foreign exchange swaps, financial swap counterparties are not required to be in compliance with the Part 43 (real-time) or Part 45 (swap data) requirements until 12:01 a.m. eastern time on May 29, 2013—on condition that, by 12:01 a.m. eastern time on June 29, 2013, the financial swap counterparty “backload” and report to an SDR all transaction data, for the period from April 10, 2013, to May 29, 2013, that the financial swap counterparty would have been required to report pursuant to Part 45 in the absence of the no-action relief;

(iii) For all swap asset classes, financial swap counterparties are not be required to be in compliance with the Part 46 (historical swap) requirements until 12:01 a.m. eastern time on September 30, 2013.

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