CFTC Reminds Non-U.S. Swap Dealers of CCO Annual Report Requirements

The CFTC Market Participants Division ("MPD") reminded non-U.S. swap dealers that rely on substituted compliance of their CCO annual report obligations.

MPD found filings that have not been consistent with CFTC directives that would satisfy the CCO annual report requirements pursuant to CFTC Regulation 3.3(f) ("Furnishing the annual report to the Commission"). MPD stated that swap dealers must "submit the report as it was prepared or provided to the relevant home regulator, with the only alteration being to translate it into English." MPD warned against filing altered or redacted reports or reports that "appear to have been prepared for the Commission in a format that mimics the requirements of Commission Regulation 3.3(e) ("Annual Report"), but that often fail to meet important substantive requirements of that rule, such as excluding any discussion of areas for improvement or material non-compliance issues."

MPD urged market participants to reach out with questions. The staff acknowledged that some information filed with home country regulators may be subject to legal restrictions or raise questions about whether such information can be provided to the CFTC.

CFTC Commissioner Caroline D. Pham stated that (i) the requirement to submit the home regulator report should be read as limited to the swap dealing activity of the relevant swap dealer and (ii) some jurisdictions have privacy/blocking laws that may bar sharing information with the CFTC. Ms. Pham urged firms with these issues to provide a cover letter with their filing to the CFTC explaining relevant matters, and to discuss these issues with MPD prior to limiting any filing.