BGC Derivative Markets, L.P

Rule Implementation Submission 2020-01 

October 19, 2020

1. The texts of the amended Rules are appended as Attachment A. Any additions are 

underlined and any deletions are struck through.

2. The date of intended implementation for these rules is ten business days following the 

filing of this submission.

3. Attached, please find a certification that: (1) these rules comply with the Commodity 

Exchange Act (“Act”), and the Commission’s regulations thereunder; and (2) concurrent 

with this submission, BGCDMLP posted on its website: (i) a notice of pending 

certification of the rule amendments with the Commission; and (ii) a copy of this 

submission.

4. A concise explanation and analysis of the operation, purpose, and effect of each of the 

amended rules appears below.

5. There were no opposing views expressed regarding these amended rules.

6. Confidential treatment is not requested.

CONCISE EXPLANATION AND ANALYSIS OF THE OPERATION, PURPOSE, AND 

EFFECT OF THE RULE AMENDMENT AND ITS COMPLIANCE WITH APPLICABLE 

PROVISIONS OF THE ACT, INCLUDING CORE PRINCIPLES AND THE 

COMMISSION’S REGULATIONS THEREUNDER

Pursuant to Commission Rule 40.6(a)(7)(vi), the following is a concise explanation and analysis 

of the operation, purpose, and effect of the amended rules. The attached amendments are 

cumulative and in response to suggestions and guidance from the staff during the course of the 

staff review of the BGCDMLP application for registration as a Swap Execution Facility. These 

amendments are either:

(1) technical corrections to align the rules more closely with the language of Commission 

Rules; and/or

(2) amendments made in response to guidance of Commission staff.

The following chart identifies the changed rules and notes the effect of the change and an 

explanation of the operation, purpose, and effect of the change.
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CONCISE EXPLANATION AND ANALYSIS OF THE OPERATION, PURPOSE, AND 

EFFECT OF THE RULE AMENDMENT AND ITS COMPLIANCE WITH APPLICABLE 

PROVISIONS OF THE ACT

Rule Rule Title Effect

101 Package Transaction Add definition of a Package Transaction.

510(g) Block trades Amend text to update relief reference to 

CFTC Letter No. 17-60 and date of 

expiration of relief.

513(d) Package Transactions Amend text to update relief reference to 

CFTC Letter No. 20-31 and date of 

expiration of relief.

513(e) Package Transactions Amend text to update relief reference to 

CFTC Letter No. 20-31 and date of 

expiration of relief.

515(a) Error Trades Amend text to update relief reference to 

CFTC Letter No. 20-01 and date of 

expiration of relief.

515(c) Error Trades Amend text to clarify an exception 

to this rule.

515(d)(i) Error Trades Amend text to add no-action relief from 

CFTC Letter No. 20-01 to allow an 

alternative method for correcting swaps 

with errors.

517(a)

517(b)

517(c)

Post-Trade Anonymity Add rule to explain post trade 

anonymity in reference to CFTC 

final rule §37.9(d)
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CERTIFICATIONS PURSUANT TO SECTION 5c OF THE COMMODITY EXCHANGE 

ACT, 7 U.S.C. §7A-2 AND COMMODITY FUTURES TRADING COMMISSION RULE 40.6, 

17 C.F.R. §40.6

I hereby certify that:

(1) the amended Rules above comply with the Commodity Exchange Act, and the 

Commodity Futures Trading Commission’s regulations thereunder; and

(2) concurrent with this submission, BGC Derivative Markets, L.P. posted on its website:

(a) a notice of pending certification of the above Rules with the Commission; and (b) 

a copy of this submission

By: Michael C. Sulfaro 

Title: Chief Compliance Officer 

Date: October 19, 2020
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BGC Derivative Markets, L.P. Rules

* * *

PART 1. MEANING OF TERMS.

101. Definitions.

“Package Transaction” means any transaction which consists of two or more component transactions 

executed between two or more counterparties where: 1. execution of each component transaction is 

contingent upon the execution of all other component transactions, and 2. the component transactions 

are priced or quoted together as one economic transaction with simultaneous or near-simultaneous 

execution of all components.

PART 2. TRADING.

510. Block Trades.

(g) Notwithstanding anything to the contrary in this Rule 510, until December 15, 

2015November 15, 2020, or such later time as the relief in CFTC Letter No. 14-11817-60 

shall be extended, the Facility may facilitate the execution of Block Trades within the 

scope of this Rule 510 that are intended to be cleared by enabling the applicable

513. Package Transactions.

(d) MAT/Non-MAT (Uncleared). Until February 12, 2016November 15, 20222020, or such 

later time as the relief in CFTC Letter No. 20-3117-5514-137 may be extended, a 

package transaction consisting of one or more Swaps that include both a Required 

Transaction and an uncleared Permitted Transaction shall be subject to the procedures of 

Rule 512.

513. Package Transactions.

(e) MAT/Non-Swap Instruments. Until November 15, 20222020February 12, 2016, or such 

later time as the relief in CFTC Letter No. 20-3117-5514-137 may be extended, the 

Required Transaction leg or legs of a package transaction that consists of one or more 

Required Transaction and one or more non-Swap instrument, shall be subject to the 

procedures of Rule 512; provided however, this provision shall not apply to U.S. Dollar 

Spreads which shall be subject to the procedures of paragraph (a).
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515. Error Trades.

(a) Scope. Until the effective date of any changes in the regulations, June 15, 2016, or such 

later time as the relief in as relief is provided in CFTC Letter No. 20-01 17-27 15-24 

shall be extended, this Rule 515 shall apply where an operational or clerical error or 

omission made by the Facility,

515. Error Trades.

(c) Such correcting trades must be executed and submitted for clearing no later than three 

days from the execution of the Cleared Error Trade, with the exception provided in (d) 

(i). The new trade shall be subject to the procedures of Rule 501(d) or Rule 502(b), as

applicable.

515. Error Trades.

(d) Consent to correction of Error Trades. In the event that an error comes to the attention of 

the Facility, the Facility may correct obvious errors under the procedures of paragraph (b) 

or (c) of this Rule 515 without the consent or knowledge of the counterparties to the 

transaction. In the event that the Facility is unable to determine how to correct an Error 

Trade on its face, the Facility shall inform the counterparties to the trade and request their 

assistance in determining the nature and the substance of the error. The Facility may not 

correct such non-obvious errors unless the parties shall agree.

(i) Alternatively, for cleared swaps, the Facility may use an ex post facto review 

process in which the counterparties determine that an error has occurred and 

correct the error. The offsetting trade and the correct transaction must be executed 

and submitted for clearing as quickly as technologically practicable, but no later 

than 24 hours after the erroneous cleared swap was executed. 

The Facility shall conduct an ex post facto review of the error trade, offsetting 

trade, and correct trade on a T+1 basis. Such review will consider whether a 

transaction cancellation or price adjustment will adversely impact market 

integrity, facilitate market manipulation or other illegitimate activity, or otherwise 

violate the CEA, Commission regulations, or the SEF’s rules.

The SEF must make an affirmative finding that there was an error as part of its ex 

post facto review.
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517. Post-Trade Anonymity.

(a) Pursuant to the Commission issuing final rule § 37.9(d), it is prohibited to disclose, 

directly or indirectly, including through a third-party service provider, the identity of a 

counterparty for swaps executed, pre-arranged or pre-negotiated anonymously on or 

pursuant to the rules of a SEF and intended to be cleared at the time of execution.

(b) Prohibition on post-trade name give-up shall not apply to components of a package 

transaction that are uncleared swaps or non-swap instruments. Examples include, but 

are not limited by, swaps executed with a US Treasury hedge cleared bilaterally 

between the counterparties, swaps executed as part of a hedge to an Interest Rate 

Option or Credit Option and swaps executed as part of a package with an uncleared 

swap.

(c) The compliance date for swaps subject to the trade execution requirement under section 

2(h)(8) of the CEA is November 1, 2020. The compliance date for swaps not subject to 

the trade execution requirement under section 2(h)(8) of the CEA is July, 5, 2021.