CPO Registration Relief Where Sister Company Serves in Stead (CFTC Letters 13-17, 13-18, 13-19 and 13-20) (with Lofchie Comment)

The Division of Swap Dealer and Intermediary Oversight provided no-action relief to various general partners and a managing member of commodity pools from registering as a CPO under Section 4m(1) of the Commodity Exchange Act, and allowed an affiliated CPO ("designee") to serve as the CPO of the pools instead, where, among other things: (1) the general partners or managing member (hereinafter "general partners") and the designee are under common ownership and control; (2) the general partners have delegated all of their management authority to the designee; (3) the general partners do not engage in the solicitation of investors for the pools and do not manage property of the pools; and (4) each of the general partners and the designee executed and submitted to the Division a written acknowledgement by which they undertake joint and several liability for any violation of the Act or the Commission's regulations.

Lofchie Comment: Industry guidance should be issued shortly so that CPOs are not required to write individual letters.

See: No-Action Letter 13-17; Letter 13-18; Letter 13-19 (All to do with General Partners).See: No-Action Letter 13-20 (Managing Member).