Dodd-Frank: Yet More No-Action

Friday 28 June 2013. In a wholly unexpected move, the CFTC issued another two no-action letters.  A brief summary follows:

• Time-limited relief for SD/MSP’s with respect to the portfolio reconciliation requirements of regulation § 23.502. This blanket relief is of short duration, expiring on 23 August 2013;
• Time-limited relief with respect to reporting obligations under Parts 20, 45 and 46. The relief provides temporary compliance with the privacy/secrecy laws of certain non-US jurisdictions, enabling the identity of large swap counterparties to be masked.  The relief expires on 30 June 2014.

The short-term portfolio reconciliation relief was widely requested and expected, largely due to the technological and administrative challenge of the requirement.  The reporting requirements letter is a longer extension of relief granted by an earlier letter No. 12-46, itself extended by letter No. 13-41. The conditions/criteria contained in this exemptive daisy-chain have been criticised as administratively burdensome, though this is hardly atypical of Dodd Frank as a whole. It is, however, indicative of the many problems this US-centric legislation faces in its interaction with the rest of the world.

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