Key takeaways:

• The Division of Swap Dealer and Intermediary Oversight (the "Division") of the CFTC issued responses to frequently asked questions regarding the compliance obligations of CPOs and CTAs in light of recent amendments to CFTC Regulations (the "FAQ").
• The Division responses in the FAQ provide, among other things, that:
  • The investment manager of a commodity pool, instead of the general partner or the managing member of the pool, is permitted to register as a CPO for the pool, if certain delegation conditions are satisfied.
  • Wholly-owned subsidiaries of a commodity pool trading in derivatives are themselves commodity pools.
  • CPOs claiming exemption under the de minimis test should be given a reasonable time to comply with the required trading thresholds where, due to certain deal structures, commodity interest positions are necessarily the first position entered into in furtherance of that structure.
  • The de minimis test only requires a CPO to be in compliance with trading thresholds at the time a position is established, and CPOs will not otherwise be required to reconfigure their portfolios to comply with such limits.
  • CPOs of funds of funds may continue to rely on former Appendix A to part 4 of the CFTC Regulations until the Commission adopts revised guidance.