On December 18, 2012, the CFTC's Division of Swap Dealer and Intermediary Oversight ("DSIO") issued time-limited no-action relief concerning the inclusion of certain swaps in a market participant's swap dealer de minimis calculation. Specifically, No-Action Letter 12-57 provides that a market participant may exclude from its calculation of the gross notional amount of swaps connected with its dealing activity any swap executed on NGX prior to the earlier of (1) March 31, 2013, or (2) the grant or denial of NGX's application as a Foreign Board of Trade ("FBOT"). The no-action relief is needed

The CFTC recently adopted a final rule and interim final rule governing commodity options. That rulemaking includes a requirement that counterparties to unreported trade options must file an annual notice with the CFTC on new Form TO. This notice solicits comments on the reporting requirement that would be imposed by Form TO. Comments Due: February 15, 2013. View release in full: 77 FR 74647.

On December 17, 2012, the Commodity Futures Trading Commission voted to amend Rules 1.31 and 1.35 to require recording of certain oral communications that lead to the execution of a transaction in a "commodity interest" by certain CEA-registered persons. See News Item: CFTC Announces Approval of Final Rule on Recordkeeping (with Lofchie Comment). Although recording is being mandated by the CFTC for both these registered entities under Rule 1.31 and 1.35, as well as for swap dealers and major swap participants under Part 23, firms should be aware that the electronic recording of conversations

The SEC issued an order granting conditional exemptive relief from compliance with certain provisions of the Exchange Act in connection with a program to commingle and portfolio margin customer positions in cleared credit default swaps, which include both "swaps" and "security-based swaps," in a segregated account. The order is necessary due to the two-track regime in the United States for the treatment of derivatives based on securities. [See related story: House Democrats Frank and Capuano Push for SEC-CFTC Merger Bill (with Lofchie Comment).] "Security-based swaps," which are also

The SEC charged a hedge fund manager with conducting a "cherry-picking" scheme by steering winning trades to proprietary trading accounts, and favored clients, to the detriment of certain hedge fund investors. The adviser was also charged with failing to disclose the firm's "precarious financial condition" to clients in a timely manner. See: SEC Complaint. See also: SEC Litigation Release.