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CFTC scales new no-action heights

The CFTC’s Division of Market Oversight yesterday announced their issuance of No-Action Letter 15-38. The letter extends relief for SDs and MSPs from compliance with reporting obligations under Rule 45.4(b)(2(ii). The rule requires SD/MSPs to provide an SDR with continuing valuation data for cleared swaps. ISDA repeated its case that establishing connections to SDRs is excessively burdensome in time and money, particularly in the context of the preceding Rule 45.4(b)(2(i), which imposes an independent but identical obligation on the relevant DCO.

No doubt there was some merit in this argument back in December 2012, when Letter No. 12-55 first allowed the relief. This was then extended in June 2013 by Letter No. 13-34, which was itself extended by June 2014’s Letter No. 14-90, the predecessor to today’s relief.  The latest extension expires 30 June 2016; meantime “The Division is aware of these issues and is working toward achieving a more permanent resolution for issues related to valuation data.” Market participants may be forgiven a lack of obvious haste in preparations to comply with this fourth deadline.

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