CFTC Proposes to Reduce Reporting and Recordkeeping Requirements for End-Users of Trade Options

5 May 2015
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Key takeaways

  • The CFTC has issued proposed rules which would reduce the reporting and recordkeeping requirements applicable to entities that are not swap dealers or major swap participants and that enter into trade options.
  • The Proposed Rules would eliminate the Form TO annual notice reporting requirement for otherwise unreported trade options entered into by such commercial end-user counterparties, replacing it with a requirement to provide notice to the CFTC’s Division of Market Oversight where the aggregate notional value of such a counterparty’s trade options exceeds (or is reasonably expected to exceed) $1 billion in any calendar year.
  • The Proposed Rules also would exempt such counterparties from the CFTC’s part 45 reporting requirements and would subject such counterparties to only a limited set of recordkeeping requirements in connection with their trade options, provided that such counterparties obtain a legal entity identifier and provide such LEI to their swap dealer and major swap participant counterparties.