CFTC Extends No-Action Relief for RTO (CFTC Letter 16-27)

The CFTC Divisions of Clearing and Risk, Market Oversight and Swap Dealer and Intermediary Oversight (collectively, "Divisions") extended a general grant of no-action relief from CEA-related regulation to a regional-transmission organization ("RTO").

The extended no-action relief from CEA regulation applies to (i) contracts, agreements and transactions for the purchase or sale of certain "transmission congestion rights," "energy transactions" and "operating reserve transactions" (if such transactions are offered or entered into pursuant to a FERC-approved tariff), and (ii) certain preliminary activities related to the RTO's transmission congestion right market necessary to support the launch of its integrated marketplace.

The no-action relief will expire on the earlier of September 16, 2016 (the relief had been set to expire on March 16, 2016) or the date on which the CFTC takes final action on a final exemptive order for the RTO that would be similar to exemptive orders that the CFTC previously had provided other RTOs.