SIFMA AMG Submits Comments to CFTC on Cross-Border Phase-In Exemptive Order and Final Interpretive Guidance (with Lofchie Comment)

The Asset Management Group of SIFMA provided comments to the CFTC on the recent CFTC guidance and exemptive order relating to cross-border swap activities. The SIFMA letter, among other things:

• asks for additional time to comply with the "U.S. person" definition (until December 21, 2013 for assessment and identification and March 31, 2014 for compliance);
• seeks an explicit recognition by the CFTC that asset managers have the discretion to determine in good faith, based on the facts and circumstances that they deem most relevant, whether a fund's principal place of business is in the U.S.;
• asks for clarification that funds that are publicly offered or privately offered to only non-U.S. persons should categorically be non-U.S. persons; and
• requests substitute compliance to be available for all entities, including funds and other asset management clients.

Lofchie Comment: Adoption of SIFMA's recommendations would go a long way towards addressing the ambiguities present in the CFTC guidance – particularly as to the difficulties for determining the status of entities run by asset managers operating across borders and with investors from numerous locations.

See: SIFMA AMG Comment Letter; SIFMA Press Release.See also: Industry Groups Submit Critical Comments on CFTC Cross-Border Guidance (with Lofchie Comment) (August 13, 2013); CFTC Exemptive Order for Certain Swap Regulations (Fed. Reg. Version) (July 22, 2013); Delta Strategy Group Summary: Final CFTC Cross-Border Guidance and Accompanying Exemptive Order (July 19, 2013); CFTC Posts "Cross-Border Guidance" and "Cross-Border Exemptive Order" for Swaps (July 15, 2013).