CFTC Approves Final Rule to Amend the Trade Option Exemption by Eliminating Certain Reporting and Recordkeeping Requirements for End-Users

On March 16, the U.S. Commodity Futures Trading Commission approved a final rule that eliminated certain requirements "for trade option counterparties that are neither swap dealers nor major swap participants[.]"  Release.

FDIC Board Adopts Final Rule to Increase Deposit Insurance Fund to Statutorily Required Level

On March 15, the Federal Deposit Insurance Corporation approved a final rule that increased the minimum level of the Deposit Insurance Fund to the minimum level required by the Dodd-Frank Wall Street Reform and Consumer Protection Act.  Release.

CFTC Staff Provides Relief in Connection with Swap Trade Confirmations

On March 14, the U.S. Commodity Futures Trading Commission's Division of Market Oversight published a time-limited no-action letter that changed the deadline "for relief in connection with swap trade confirmation requirements[.]"  Release.

On March 16, DBRS issued a report titled: Rating U.S. Structured Finance Transactions.  Report.

On March 16, DBRS issued a report titled: Operational Risk Assessment for U.S. ABS Servicers.  Report.

On March 16, DBRS issued a report titled: Operational Risk Assessment for U.S. ABS Originators.  Report.

On March 16, DBRS issued a report titled: DBRS Master U.S. ABS Surveillance Methodology.  Report.

On March 15, Moody's issued a report titled: Global Structured Finance Data Quality Evaluation Approach.  Report.

On March 14, Fitch issued a report titled: U.S. CMBS Delinquencies Hold Steady.  Release.

On March 14, Fitch issued a report titled: U.S. Subprime Auto ABS Delinquencies Hit Highest Level Since 1996.  Release.

On March 10, DBRS issued a report titled: Mapping Financial Institution Internal Ratings to DBRS Ratings for Global Structured Credit Transactions.  Report.

FINRA Reports on Digital Investment Advice

On March 15, the Financial Industry Regulatory Authority (commonly referred to as "FINRA") issued a Report that emphasizes that offerings of digital investment advice require sound governance and supervision, including effective means of overseeing the suitability of recommendations, conflicts of interest, customer risk profiles and portfolio rebalancing.  The Report also outlines lessons for investors and states that training and education are crucial for financial professionals who use digital investment advice tools.  FINRA is the regulatory authority that is responsible, under the supervision of the U.S. Securities and Exchange Commission, for the oversight of broker-dealers.

This Report is the most comprehensive commentary and guidance issued to date by any U.S. regulator regarding digital investment advice.  It merits careful consideration.

Although the rules discussed in the Report apply directly to broker-dealers, rather than investment advisers, the Report addresses the duties applicable to investment management services provided by broker-dealers as well as investment advisers.  Therefore, we expect that the principles and rules set forth in the Report are comparable to those that the SEC will apply to investment advisers that provide digital investment advice.  Report.  Press Release.

ESMA Practical Guidance on its Recognition of Third Country CCPS

European Securities and Markets Authority ("ESMA") has published practical guidance on the recognition by it of third country central counterparties (CCPs) under EMIR (ESMA/2016/365). The guidance is dated March 17, 2016.

The guidance covers the following phases in the application process:

• Communications with ESMA before submitting an application for recognition.
• Timeframe for submission of an application.
• Submission of an application, including format, number of copies and language.
• ESMA's acknowledgement of the receipt of an application.
• Information on the calculation of deadlines set by ESMA.
• Assessment of completeness, requests for additional information and notification of completeness.
• ESMA's examination of the application.
• ESMA's decision on the recognition application.
• Publication on ESMA's website.

Commission Sends MiFID II Draft RTS Back to ESMA for Revision

On March 17, Markus Ferber, MEP, the European Parliament's Rapporteur for MiFID II, published a press release announcing that the European Commission had sent back to European Securities and Markets Authority ("ESMA") the draft regulatory technical standards (RTS) on non-equity transparency, the ancillary activity exemption, and position limits for commodity derivatives for further revision to take the Parliament's position more thoroughly into account.

Mr. Ferber explains that the latest draft RTS were not acceptable to the Parliament, especially the position limits regime, which he believes urgently needs a comprehensive redrafting to effectively curb food speculation. He believes that the latest drafts were not up to standard and would not have solved the problem at all.

Mr. Ferber expects ESMA to revisit the technical standards swiftly, thoroughly and to adapt them in line with the Parliament's remarks. However, the redrafting must not further delay the overall MiFID II timeline. He adds that, since the Parliament's concerns were known and available for quite some time, the Commission and ESMA could easily have acted earlier.