SUBMISSION COVER SHEET

IMPORTANT: Check box if Confidential Treatment is requested 

Registered Entity Identifier Code (optional): ___________________________ 

Organization: ______________________________________________________________________ 

Filing as a: DCM SEF DCO SDR Please note - only ONE choice allowed. 

Filing Date (mm/dd/yy): ___________ Filing Description:

SPECIFY FILING TYPE Please note only ONE choice allowed per Submission. 

Organization Rules and Rule Amendments

Certification § 40.6(a)

Approval § 40.5(a)

Notification § 40.6(d)

Advance Notice of SIDCO Rule Change § 40.10(a)

SIDCO Emergency Rule Change § 40.10(h)

 Rule Numbers: ____________________________________________________________________ 

New Product Please note only ONE product per Submission.

Certification § 40.2(a) 

Certification Security Futures § 41.23(a)

Certification Swap Class § 40.2(d)

Approval § 40.3(a)

Approval Security Futures § 41.23(b) 

Novel Derivative Product Notification § 40.12(a)

Swap Submission § 39.5

 Official Product Name: _____________________________________________________________ 

Product Terms and Conditions (product related Rules and Rule Amendments)

Certification § 40.6(a) 

Certification Made Available to Trade Determination § 40.6(a)

Certification Security Futures § 41.24(a)

Delisting (No Open Interest) § 40.6(a) 

Approval § 40.5(a)

Approval Made Available to Trade Determination § 40.5(a)

Approval Security Futures § 41.24(b)

Approval Amendments to enumerated agricultural products § 40.4(a), § 40.5(a)

“Non-Material Agricultural Rule Change” § 40.4(b)(5)

Notification § 40.6(d)

 Official Name(s) of Product(s) Affected: ________________________________________________ 

Rule Numbers: ______________________________________________________________________ 
 

 

Should you have questions regarding this submission, please do not hesitate to contact Cheryl L. 

Isaac, K&L Gates, LLP at +1-202-778-9089 or Cheryl.Isaac@klgates.com, or the undersigned at 

+1-212-651-3186 or bflaster@spectraxe.com. 

Very truly yours,

Bradley Flaster

Chief Compliance Officer

SpectrAxe

February 27, 2023

Submitted via CFTC Portal

Mr. Christopher J. Kirkpatrick

Office of the Secretariat

Commodity Futures Trading Commission

Three Lafayette Centre

1155 21st Street, N.W.

Washington, D.C. 20581

Re: SpectrAxe LLC – Amendment of Rulebook (Rules 101, 211 and 407)

Dear Mr. Kirkpatrick:

Pursuant to Section 5c(c) of the Commodity Exchange Act (the “Act”) and Section 40.6(a) of the

regulations of the Commodity Futures Trading Commission (the “Commission”), SpectrAxe LLC

(“SpectrAxe”) hereby submits amendments to its Rulebook related to the above-captioned Rules

(the “Amended Rules”). Specifically, the Rulebook has been amended as detailed in Attachment

A.

The amendments will become effective on March 13, 2023, no fewer than ten business days from

the date hereof.

In connection with this submission, SpectrAxe hereby notifies the Commission that:

1. SpectrAxe certifies that it has posted a notice of this pending certification with the

Commission and a copy of this submission on SpectrAxe’s website, including redlines

of the Amended Rules, which are attached hereto as Attachment B, and a copy of the

Amended Rules, which are attached hereto as Attachment C;

2. SpectrAxe certifies that the Amended Rules comply with the Act and the Commission’s

regulations thereunder; and

3. No substantive opposing views with respect to the Amended Rules were expressed to

SpectrAxe by its governing board or committee members, members of SpectrAxe or

market participants.

* * *
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

2

Attachment A

Explanation of Changes

Rule Description of Change Explanation of Change

101 (Defined 

Terms)

The following terms were 

updated:

• Limits

• PFI Facilitation 

Agreement

Explanation of Updated Terms

• The definition of “Limits” was 

updated to reflect operational 

changes.

• The definition of “PFI Facilitation 

Agreement” was updated to 

reflect operational changes.

These changes do not directly implicate 

the swap execution facility core 

principles (Core Principles) established 

under the Commodity Exchange Act.

211 (Chief 

Compliance 

Officer)

An unused defined term was 

removed.

The reference to “the Regulatory 

Service Provider” was changed to a 

general reference to “a regulatory 

service provider.” 

This change does not directly implicate 

the Core Principles.

407 (Price 

Adjustments, 

Cancellations 

and Review of 

Executed 

Orders by the 

Company)

Rule 407(d)(i)(A) clarifies that a 

PFI may request to cancel or 

modify a Trade that is executed 

in excess or in violation of a Limit 

on the aggregate exposure a PFI 

has to another PFI.

The inclusion of Limits on the 

aggregate exposure a PFI has to 

another PFI reflects operational 

changes.

This change does not directly implicate 

the Core Principles.
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

3

Attachment B

Redline Versions of the Amended Rules 

(Rules 101, 211 and 407)
313798107.10313798107.13

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CHAPTER 1. DEFINITIONS; INTERPRETATION; AMENDMENTS

101. Defined Terms

Unless otherwise specified in these Rules or unless the context otherwise requires, the

terms defined below in this Rule 101 shall for all purposes of these Rules have the

meanings specified herein.

AAA

The term “AAA” means the American Arbitration Association.

Affiliate

An “Affiliate” of, or a Person “Affiliated” with, another Person means a Person

who, directly or indirectly, Controls, is Controlled by, or is under common Control

with, such other Person.

API

The term “API” means application programming interface.

Appeals Panel

The term “Appeals Panel” means a panel appointed by the CCO pursuant to

Rule 716(g).

Applicable Law

The term “Applicable Law” means, with respect to any Person, any statute, law,

regulation, rule or ordinance of any governmental authority, or self-regulatory

organization applicable to such Person, including without limitation the CEA, the

Exchange Act and CFTC Regulations.

Audit Trail

The term “Audit Trail” has the meaning given to that term in Rule 505(a).

Authorized User

The term “Authorized User” means any natural person who is an agent or

employee of a PFI, a Participant or any other Person that has been authorized to

access the SEF. In the case a computer or system is used to access the SEF via

an API, the natural person designated to be responsible for such computer or

system’s activity on the SEF shall be the Authorized User.
313798107.10313798107.13

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Beneficial Ownership or Beneficially Owned

The term “Beneficial Ownership,” or an interest “Beneficially Owned” by any

Person, means, with respect to an account, a direct or indirect (through one or

more subsidiaries or Affiliates) pecuniary interest in the account (through any

Swap, arrangement, understanding, relationship or otherwise).

Board

The term “Board” means the Board of Directors of the Company constituted in

accordance with the LLC Agreement, these Rules and Applicable Law.

Cancel Order

The term “Cancel Order” means an Order that cancels fully or partially an

existing Order.

Cancel Replace Order

The term “Cancel Replace Order” means an Order to cancel fully or partially an

existing Order and replace it with a new Order for a different quantity or price.

CFTC

The term “CFTC” means the Commodity Futures Trading Commission and

includes any successor agency or authority.

CFTC Regulation

The term “CFTC Regulation” means any rule, regulation, order or directive and

any published interpretation thereof adopted or promulgated from time to time by

the CFTC.

Chief Compliance Officer

The term “Chief Compliance Officer” (or “CCO”) means the individual appointed

by the Board from time to time to oversee compliance matters in accordance

with Rule 211.

Chief Executive Officer

The term “Chief Executive Officer” (or “CEO”) means the individual appointed by

the Board from time to time to serve as chief executive officer of the Company.
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Chief Operating Officer

The term “Chief Operating Officer” (or “COO”) means the individual appointed by

the Board from time to time to serve as chief operations officer of the Company.

Cleared Swap

The term “Cleared Swap” means a Swap that is required to be cleared by a DCO

pursuant to Section 2(h)(1) of the CEA and CFTC Regulation 50.2 (Treatment of

Swaps Subject to a Clearing Requirement) or is otherwise designated by or on

behalf of the parties to be submitted to a DCO for clearing, including a New

Swap/Old Terms or New Swap/Corrected Terms, including any such Swap that

is rejected from clearing by the applicable DCO. As of the date of this Rulebook,

the SEF does not offer Cleared Swaps.

Client Account

The term “Client Account” means a Person that has granted investment

discretion to trade on its behalf.

Commodity Exchange Act

The term “Commodity Exchange Act” (or “CEA”) means the law set forth at 7

U.S.C. § 1, et. seq.

Company

The term “Company” will be SpectrAxe, LLC.

Company Official

The term “Company Official” means any Officer of, or individual employed

directly by, the Company or any individual rendering similar services on behalf of

the Company under a secondment agreement.

Compliance Department

The term “Compliance Department” means the CCO and the individuals under

the supervision of the CCO who are responsible for enforcing these Rules and

conducting investigations of alleged violations of these Rules. As the term is

used herein, the Compliance Department includes: (i) the Company’s

compliance staff dedicated to enforcing these Rules and performing services

directly related to the Company’s compliance with Applicable Law and (ii)

employees of other divisions of the Company or its Affiliates who have certain

regulatory responsibilities with respect to the Company.
313798107.10313798107.13

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Control

The term “Control,” including the terms “Controlling,” “Controlled by” and “under

common Control with,” means the possession, direct or indirect, of the power to

direct or cause the direction of the management and policies of a Person,

whether through the ownership of securities or otherwise.

Derivatives Clearing Organization

The term “Derivatives Clearing Organization” (or “DCO”) has the meaning given

to that term in Section 1a(15) of the CEA. For the avoidance of doubt, the

Company does not submit Uncleared Swaps to a DCO and does not have any

agreement or arrangement with a DCO for Uncleared Swaps.

Designated Contact

The term “Designated Contact” means a natural person who is designated,

pursuant to Rule 416, with the authority to act on behalf of and represent the

Participant or PFI as applicable. The Designated Contact may, but need not be,

an Authorized User.

Director

The term “Director” means any member of the Board.

Disciplinary Offense

The term “Disciplinary Offense” shall have the meaning set forth in Rule 209(c).

Disciplinary Panel

The term “Disciplinary Panel” means the panel appointed pursuant to Rule 710

to conduct hearings in connection with disciplinary proceedings (other than

summary impositions of fines pursuant to Rule 717), to make findings, render

decisions, and impose sanctions pursuant to Chapter 7 of the Rules.

Electronic Access

The term “EA” or “Electronic Access” means electronic access to the SEF’s

Order Book and execution functionality through direct electronic connection.

Eligible Contract Participant

The term “Eligible Contract Participant” has the meaning given to that term under

Section 1a(18) of the CEA and CFTC Regulations thereunder.
313798107.10313798107.13

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Emergency

The term “Emergency” has the meaning given to that term in Rule 412(a).

Exchange Act or Securities Exchange Act of 1934

The term “Exchange Act” of “Securities Exchange Act of 1934” means the law

set forth at 15 U.S.C. § 78a, et. seq.

Final Decision

The term “Final Decision” shall have the meaning set forth in Rule 209(c).

Introducing Agent

The term “Introducing Agent” means a futures commission merchant or

introducing broker registered with the CFTC, or any Person that is exempt from

such registration (or not required under Applicable Law to so register). As of the

date of this Rulebook, Introducing Agents are not permitted on the SEF.

Investigation Report

The term “Investigation Report” has the meaning given to that term in Rule 703.

Legal Entity Identifier

The term “Legal Entity Identifier” means a unique code assigned to swap

counterparties and entities in accordance with the standards set by the Global

Legal Entity Identifier System.

Legal Team

The term “Legal Team” means the function of the SEF that is responsible for the

legal and regulatory affairs of the SEF.
313798107.10313798107.13

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Limits

The term “Limits” means the limits on trading as determined by the relevant PFI,

including but not limited to, product restrictions and trade volume limits. A PFI

may set separate Limits for Trades via the Order Book and Trades via an RFQ.

A PFI may also set Limits on the aggregate exposure it has to another PFI,

which shall take precedence over any Limits applicable to a Participant. A

breach of any such Limits (whether applicable to a Participant or a PFI) may

prevent a Participant from entering into a Trade.

LLC Agreement

The term “LLC Agreement” means the Limited Liability Company Agreement of

SpectrAxe, LLC, as amended, supplemented or otherwise modified from time to

time.

Major Swap Participant

The term “Major Swap Participant” has the meaning given to that term in Section

1a(33) of the CEA.

Market Data

The term “Market Data” means any and all data and other information contained

in, displayed on, generated by or derived from the SEF or transactions in Swaps

entered into pursuant to these Rules, including Orders, RFQs, prices and

volumes.

Market Data Vendors

The term “Market Data Vendors” means one or more vendors of financial market

information which have entered into agreements with the Company to distribute

Market Data.
313798107.10313798107.13

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Market Maker

The term “Market Maker” means a Participant authorized by the Company to

participate in the Market Maker Program under Rule 314.

Master Agreement

The term “Master Agreement” means, as applicable, either (a) the 1992 or 2002

ISDA Master Agreement published by the International Swaps and Derivatives

Association, Inc. as may be entered into between a PFI and its customer,

including any Credit Support Annex thereto or; (b) a domestic master agreement

(e.g., the FBF Master Agreement from the French Banking Federation or the

German Master Agreement for Financial Derivatives Transactions).

Message Traffic

The term “Message Traffic” means electronic transmissions of Orders, Order

modifications, Cancel Orders, Cancel Replace Orders, RFQs, trade reports and

other messages entered into the SEF by or through an Authorized User or sent

to an Authorized User by the Company. Depending on the context, Message

Traffic may refer to one-way or two-way transmissions.

NFA

The term “NFA” means the National Futures Association.

Nominating Committee

The term “Nominating Committee” means the committee of the Board

constituted pursuant to Rule 203.

Notice to Participants

The term “Notice to Participants” means a communication sent by or on behalf of

the Company to all Participants, as described in Rule 310.

Officer

The term “Officer” means any officer of the Company.

Order

The term “Order” means an actionable firm bid or offer for a Swap (i) displayed

in the Order Book, (ii) transmitted as a response to an RFQ, (iii) transmitted by

acceptance of a response to an RFQ or (iv) any modification thereof. The term
313798107.10313798107.13

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“Order” does not include an RFQ request nor a response to an RFQ that is not a

firm bid or offer.

Order Book

The term “Order Book” means the portion of the SEF in which Participants in the

trading system or platform have the ability to enter Orders designated for the

Order Book, observe or receive such Orders entered by other Participants, and

execute such Orders.

Owner

The term “Owner” means any Person holding an ownership interest in the

Company or defined as a “Member” in the LLC Agreement.

Participant

The term “Participant” refers to Swap Dealers, funds, and other such Persons

with Trading Privileges. A Participant may be acting as a principal or on behalf of

one or more Client Accounts, provided that the term “Participant” shall not

include any such Client Accounts.

Participant Agreement

The term “Participant Agreement” means the agreement between a Participant

and SpectrAxe that allows the Participant to access the SEF pursuant to the

Rules. References to Participant Agreements shall include their addendums,

unless provided otherwise. As used herein, and unless otherwise required by the

context, the term “Participant Agreement” also includes PFI Participant

Agreements.

Participant Agreement Addendum

The term “Participant Agreement Addendum” (or “the Addendum,” as context

permits) means the addendum to the Participant Agreement that states, in part,

various Limits applicable to the Participant.

Participant Committee

The term “Participant Committee” means the committee of the Board constituted

pursuant to Rule 204.
313798107.10313798107.13

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Participating Financial Institution

The term “Participating Financial Institution” (or “PFI”) means a financial

institution that has been approved by the Company to enter into the Trades that

a Participant, with whom the PFI has PFI/Participant Trading Documentation that

establishes the connection requirement pursuant to Rule 306(a), effectuates on

the SEF.

Permitted Transaction

The term “Permitted Transaction” means any transaction not involving a Swap

that is required by Section 2(h)(8) of the CEA to be executed on, or pursuant to

the rules of, a swap execution facility or a designated contract market.

Person

The term “Person” means any natural person, association, partnership, limited

liability company, joint venture, trust or corporation.

PFI/Participant Trading Documentation

The prime brokerage agreement or other such documentation that governs the

trading relationship (e.g. Master Agreement) in effect between a Participant and

a PFI and allows the Participant to satisfy the PFI connection requirement in

Rule 306.

PFI Facilitation Agreement

The term “PFI Facilitation Agreement” means the agreement between the

Company and each PFI regarding the settlement of Trades executed by the

Participants, including the establishment of Limits on the aggregate exposure a

PFI may have to another PFI through the SEF Platform.

PFI Participant Agreement

The term “PFI Participant Agreement” means the agreement between the

Company and a Participant that is the same legal entity as a PFI (e.g., a trading

desk of the PFI), which allows the Participant to access the SEF pursuant to the

Rules. References to the PFI Participant Agreement shall include their

addendums, unless provided otherwise.

Pre-Execution Communication

The term “Pre-Execution Communication” means a communication between two

Persons for the purpose of establishing the terms of an Order prior to entering

into a Trade, including any communication that involves pre-determination of the
313798107.10313798107.13

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size, side of market, or price of such an Order; provided that any communication

between two Persons that involves an agreement to enter into a Trade between

the parties that legally binds the parties to such Trade shall not be considered a

Pre-Execution Communication.

Proprietary Account

The term “Proprietary Account” has the meaning set forth in CFTC Regulation

1.3 (Definitions).

Proprietary Information

The term “Proprietary Information” has the meaning given to that term in Rule

1104(d).

Public Director

The term “Public Director” means a director of the Company with the

qualifications described in Rule 208.

Regulatory Oversight Committee

The term “Regulatory Oversight Committee” means the committee of the Board

constituted in accordance with Rule 205.

Reporting Counterparty

The term “Reporting Counterparty” has the meaning set forth in CFTC

Regulation 45.1 (Definitions).

Required Swap Continuation Data

The term “Required Swap Continuation Data” has the meaning given to that term

in CFTC Regulation 45.1 (Definitions).

Required Swap Creation Data

The term “Required Swap Creation Data” has the meaning given to that term in

CFTC Regulation 45.1 (Definitions).

RFQ

The term “RFQ” means a request for quote sent in accordance with these Rules.
313798107.10313798107.13

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Rule

The term “Rule” means any rule adopted or amended, from time to time, by the

Company related to or in respect of the operation of, or business conducted on,

the SEF.

Security

The term “Security” has the meaning given to that term under Section 3(a)(10) of

the Exchange Act.

Swap Data Repository

The term “Swap Data Repository” (or “SDR”) means any swap data repository

registered with the CFTC to which the Company may select to report, as

required by and in accordance with the CEA and CFTC Regulations, the terms of

the Trades executed pursuant to these Rules.

Swap Execution Facility

The term “Swap Execution Facility” (or “SEF” or “SEF Platform”) means the swap

execution facility operated by the Company and registered as such with the

CFTC.

SEF Data

The term “SEF Data” means any and all data and other information related to

Swap activities on the SEF or pursuant to this Rulebook, including but not limited

to Market Data.

Settlement Agreement

The term “Settlement Agreement,” shall have the meaning set forth in Rule

209(c).

Standing Committee

The term “Standing Committee” means each of the Nominating Committee, the

Participant Committee and the Regulatory Oversight Committee.

Swap

The term “Swap” has the meaning given to that term in Section 1a(47) of the

CEA and in the CFTC Regulations promulgated thereunder (without regard to

any determination by the Secretary of the Treasury pursuant to Section 1b of the

CEA).
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Swap Dealer

The term “Swap Dealer” has the meaning given to that term in Section 1a(49) of

the CEA.

Terms Incorporated by Reference

The term “Terms Incorporated by Reference” has the meaning given to that term

in Rule 1101(b)(i).

Trade

The term “Trade” means a Swap transaction that is executed on the SEF

Platform or subject to the Rules.

Trade Communication

The term “Trade Communication” means a written or electronic confirmation

from the SEF regarding the status of a Trade (i.e., whether the Trade is

confirmed, amended or cancelled) and with all necessary economic terms.

Trading Hours

The term “Trading Hours” means, with respect to any Swap, the hours during

which the SEF is regularly open for the trading of such Swap.

Trading Privileges

The term “Trading Privileges” means the rights associated with allowing a

Person to enter into Trades, such as allowing that Person’s Authorized Users to

enter Orders or RFQs, respond to RFQs, enter into Trades and otherwise effect

Swap transactions, whether directly or indirectly, on or pursuant to the Rules of

the SEF, either on that Person’s own behalf or on behalf of Client Accounts.

Uncleared Swap

The term “Uncleared Swap” means a Swap other than a Cleared Swap. As of the

date of this Rulebook, all swaps executed on the SEF will be an Uncleared

Swap.

Underlying Instrument

The term “Underlying Instrument” means, with respect to a Swap, the good,

right, security, index or other asset or measure which is the subject of that Swap.
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Unique Transaction Identifier

The term “Unique Transaction Identifier” or “UTI” shall have the meaning set

forth in CFTC Regulation 45.5 (Unique Transaction Identifiers).

User ID

The term “User ID” means a unique identification number assigned by the

Company to an Authorized User.

102. Rules of Interpretation

For all purposes of these Rules, except as otherwise expressly provided herein or

unless the context otherwise requires:

(a) the terms defined in these Rules include the plural as well as the singular and

vice versa;

(b) words importing gender include all genders;

(c) any reference to a Chapter, Rule or Appendix refers to a Chapter or Rule of, or

Appendix to, these Rules;

(d) any reference to these Rules refers to these Rules, including all Appendices

hereto, and the words herein, hereof, thereto, hereto and hereunder and words

of similar import refer to these Rules and their Appendices as a whole and not to

any particular Chapter, Rule, Appendix or any other subdivision;

(e) references to days, months and years refer to calendar days, months and years,

respectively;

(f) all references herein to “including” are deemed to be followed by the words

“without limitation;” and

(g) any term used but not defined herein that is defined in the CEA or CFTC

Regulations (including without limitation in CFTC Regulation 1.59 (Activities of

Self-Regulatory Organization Employees, Governing Board Members,

Committee Members, and Consultants)) shall have the meaning assigned to it

therein.

103. Effect of Titles

The titles of these Rules have been inserted for convenience of reference only and shall

not affect the meaning of these Rules.
313798107.10313798107.13

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(v) is currently subject to or has had imposed on him within the past three

years a CFTC registration revocation or suspension in any capacity for

any reason, or has been convicted within the past three years of any of

the felonies listed in Section 8a(2)(D)(ii) through (iv) of the CEA; or

(vi) is currently subject to a denial, suspension or disqualification from serving

on a disciplinary committee, arbitration panel or governing board of any

self-regulatory organization as that term is defined in Section 3(a)(26) of

the Exchange Act.

(b) Upon the occurrence of an event listed in this Rule 209 with respect to a

Director, Officer or member of a Standing Committee, Disciplinary Panel or

Appeals Panel, such Person shall disclose the occurrence of such event to the

CCO or his designee.

(c) For purposes of this Rule 209, the terms “Disciplinary Offense,” “Final Decision,”

and “Settlement Agreement” shall have the meanings set forth in CFTC

Regulation 1.63 (Service on Self-Regulatory Organization Governing Boards or

Committees by Persons with Disciplinary Histories).

210. Officers

The Board shall appoint a CEO, a COO, a CCO and such other officers of the Company

as it may deem necessary or appropriate from time to time, in each case for such term

and on such other conditions as it sees fit. Any Officer may also be a member,

manager, director, officer, partner or employee of the Company or any of its Affiliates.

211. Chief Compliance Officer

(a) The Board shall designate an individual to serve as the CCO of the Company.

The CCO shall:

(i) report directly to the Regulatory Oversight Committee;

(ii) oversee and review the Company’s compliance with the Core Principles

set forth in Section 5h of the CEA and Part 37 of the CFTC Regulations;

(iii) resolve, in consultation with the Board, the Regulatory Oversight

Committee or the CEO, any conflicts of interest that may arise, including:

(A) conflicts between business considerations and compliance

requirements, including the requirement that the Company

provide fair, open and impartial access in accordance with CFTC

Regulation 37.202 (Access Requirements); and
313798107.10313798107.13

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(B) conflicts between the Company’s management and members of

the Board;

(iv) establish and administer written policies and procedures reasonably

designed to prevent violations of the CEA and CFTC Regulations;

(v) take reasonable steps to ensure compliance with the CEA and CFTC

Regulations;

(vi) establish procedures for the remediation of noncompliance issues

identified by the CCO through Compliance Department reviews,

look-backs, internal or external audit findings, self-reported errors or

validated complaints;

(vii) establish and follow appropriate procedures for the handling,

management response, remediation, retesting, and closing of

noncompliance issues;

(viii) establish and administer a compliance manual designed to promote

compliance with the applicable laws, rules, and regulations and a written

code of ethics designed to prevent ethical violations and to promote

honesty and ethical conduct;

(ix) supervise the Company’s self-regulatory program with respect to trade

practice surveillance, market surveillance, real-time market monitoring,

compliance with audit trail requirements, enforcement and disciplinary

proceedings, audits, examinations, and other regulatory responsibilities

with respect to Participants, Authorized Users, all Persons using any

Participant’s User IDs, and all other Persons subject to the jurisdiction of

the SEF under Rule 301, and, in addition to the foregoing in this Rule

211(a)(ix), exercise supervisory authority over all staff acting at the

direction of the CCO;

(x) provide any information regarding the Company’s self-regulatory program

that is requested by the Board or the Regulatory Oversight Committee;

(xi) supervise the effectiveness and sufficiency of any regulatory services

provided to the Company by the Regulatory Service Providera regulatory

service provider in accordance with CFTC Regulation 37.204 (Regulatory

Services Provided by a Third Party); and

(xii) prepare the Company’s annual compliance report, in accordance with

CFTC Regulation 37.1501 (Chief Compliance Officer), and submit the

completed report to the Board and CFTC.
313798107.10313798107.13

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(b) No individual disqualified from registration pursuant to Section 8a(2) or 8a(3) of

the CEA may serve as CCO.

212. Confidentiality

No Company Official, member of the Board, any committee established by the Board, or

any Disciplinary Panel or Appeals Panel shall use or disclose any material, non-public

information, as defined in CFTC Regulation 1.59(a) (Activities of Self-Regulatory

Organization Employees, Governing Board Members, Committee Members, and

Consultants), obtained in connection with the performance of his official duties for any

purpose other than the performance of such official duties.

213. Conflicts of Interest

(a) Definitions. For purposes of this Rule 213, the following definitions shall apply:

(i) The term “member’s affiliated firm” shall mean a firm in which a member

of the relevant deliberating body is an employee, an “associated person,”

as defined in CFTC Regulation 1.3 (Definitions), or a “principal,” as

defined in CFTC Regulation 3.1(a) (Definitions).

(ii) The term “named party in interest” shall mean a Person that is identified

by name as a subject of any matter of a Rule enforcement or any

disciplinary matter or appeal being considered by the Board, a

disciplinary committee or oversight panel.

(iii) The term “significant action” shall mean any action taken by the

Company, including without limitation a change of any Rule, to address

an Emergency.

(b) Named Party in Interest Conflict.

(i) Prohibition. No Officer or member of the Board, Standing Committee,

Disciplinary Panel or Appeals Panel shall knowingly participate in

deliberations or voting in any matter, including the discipline and

enforcement procedures listed in Chapter 7 of this Rulebook, when such

individual:

(A) is a named party in interest;

(B) is an employer or employee or fellow employee of a named party

in interest, or is a secondee from or placed at a named party in

interest or an entity that employs a named party in interest;
313798107.10313798107.13

41

in order to gain or extend a delay in public dissemination of accurate Swap transaction

or pricing data or to otherwise evade the reporting requirements of Part 43 or Part 45 of

CFTC Regulations.

If the Company modifies or cancels an Order under this Rule 405, it will do so in good

faith and in a commercially reasonable manner and will provide prior written notice of

such modification or cancellation to the affected Participants and PFIs. Nothing in this

Rule shall in any way limit the authority of the Company to take action in response to an

Emergency pursuant to Rule 412.

406. Information Regarding Orders

The Company will make information from the SEF available to Participants and other

Persons at such times and in such manner (whether through the SEF, financial

information services or otherwise) as it may be required by Applicable Law, including,

but not limited to CFTC Regulation 37.900 (Timely Publication of Trading Information),

provided that SEF Data and other information related to a Participant, Authorized User,

Client Account or PFI, as applicable, shall not be disclosed by the Company unless

permitted by these Rules or Applicable Law, including CFTC Regulation 37.7 (Prohibited

Use of Data Collected for Regulatory Purposes). Each Participant or other Person

receiving any such information through the SEF may redistribute such information only

to such extent and in such manner as may be permitted by the Company in writing from

time to time.

407. Price Adjustments, Cancellations and Review of Executed Orders by the Company

(a) Adjustment and Cancellation Authority.

The Company may adjust trade prices or cancel executed orders, solely in

accordance with published policies of the Company, when such action is

necessary to mitigate market disrupting events caused by: (i) improper conduct

such as market manipulation or clearly erroneous trading behavior (e.g., fat

finger entries) or (ii) malfunctions in the Company’s systems. If the Company

takes any action pursuant to this Rule 407(a), it will do so in a commercially

reasonable manner, considering whether such price adjustment or cancellation

will adversely impact market integrity, facilitate market manipulation or other

illegitimate activity, or otherwise violate the Rules or Applicable Law, and it will

give prompt notice and in any event will use good faith, commercially reasonable

efforts to provide any affected Participants and PFIs with reasonable prior notice

and, where required by Applicable Law (including CFTC Regulation 37.405 (Risk

Controls for Trading)), to obtain consent to such adjustment or cancellation.

Participants shall be responsible for obtaining any required consent to such

adjustment or cancellation from their Client Account(s), if applicable.

(b) Review of Trades Generally.
313798107.10313798107.13

42

Subject to Rule 407(c), the Company may initiate a review of a Trade based on

its analysis of market conditions or in response to a request for review by a

Participant. Such request for review must be made as soon as practicable but in

no event after the end of the business day in which such Trade took place. The

Company shall promptly determine whether the Trade will be subject to review

and, upon deciding to review the Trade, the Company will promptly issue an alert

to the affected Participants and PFIs indicating that the Trade is under review. In

the case of a Trade determined by the Company to be illiquid, the Company may

initiate a review on its own initiative if it determines that the trade price was

significantly out of line with prices in the market at the time of such transaction

(based on pricing data that is readily available to the Company). In the course of

its review of any Trade, the Company may, but is not obligated to, inform any of

the affected Participants and PFIs the identity and contact information of the

other affected Participant and PFI.

(c) Trading Errors or Omissions.

The Company provides a Help Desk telephone number and email address to

report any errors or omissions. Upon receipt of a report of an error or omission,

the Company reviews the audit trail information and contacts all affected

Participants and PFIs to confirm the error or omission. If the error or omission is

confirmed, the Company follows the procedures on trade review noted in Rule

407(b). If the error or omission is not confirmed, the Company contacts the

Person that provided the notice to notify the Person that there will be no

correction to the data previously reported to the SDR.

(d) PFI Cancellation or Modification.

(i) A PFI shall have the right to request a cancellation or modification of any

Trade:

(A) that is executed in excess or in violation of a Limit set by the PFI,

including a Limit on the aggregate exposure it has to another PFI;

or

(B) that is executed by or with a Person that was not authorized by

the PFI under the relevant PFI/Participant Trading

Documentation.

(ii) A PFI must request the cancellation or modification by sending a notice to

the Company that states the UTI of the Trade (if any) and the reason for

cancellation or modification. If the Company determines that the

cancellation or modification satisfies the conditions of this Rule, the

Company will cancel or modify the Trade.
313798107.10313798107.13

43

(A) Alternatively, a PFI may request the cancellation or modification of

a Trade by contacting the Help Desk.

408. Position Limits

(a) To reduce the potential threat of market manipulation or congestion, the

Company may adopt for each of the contracts of the SEF, as is necessary and

appropriate, position limitations. The Company may grant exemptions from

position limits, as it may determine to be necessary and appropriate, in

accordance with CFTC Regulations (including notice provisions consistent with

Applicable Law, such as CFTC Regulations 40.5(a)(6) (Voluntary Submission of

Rules for Commission Review and Approval) and 40.6(a)(2) (Self-Certification of

Rules) and CFTC Regulations 37.600 (Position Limits or Accountability) and

37.601 (Additional Sources for Compliance)). This Rule 408 shall apply in the

event that the Company does adopt any such position limits, which limits will be

included in these Rules, if adopted, and prior notice of any such adoption will be

provided as a Notice to Participants consistent with Rule 310 and in accordance

with Applicable Law (including notice provisions consistent with Applicable Law,

including CFTC Regulations 40.5(a)(6) and 40.6(a)(2). The Company will monitor

all such position limits for whether they meet or exceed reportable levels. The

Company shall continually assess whether additional position limits are

necessary, appropriate, and should be adopted.

(b) A Person seeking an exemption from position limits, including limits established

pursuant to a previously-approved exemption, must file the required application

with the Compliance Department and receive approval prior to exceeding such

limits. Notwithstanding the foregoing, a Person who establishes an

exemption-eligible position in excess of position limits and files the required

application with the Company shall not be in violation of this Rule provided the

filing occurs within one business day after assuming the position. In the event

the positions in excess of the limits are not deemed to be exemption-eligible,

such Person will be in violation of position limits for the period of time in which

the excess positions remained open.

The application must be in the form and manner prescribed by the Compliance

Department and, at a minimum, must: (i) provide a description of the exemption

sought, including whether the exemption is for bona fide hedging positions as

defined in CFTC Regulation 1.3 (Definitions), risk management positions or

arbitrage/spread positions; (ii) provide a complete and accurate explanation of

the underlying exposure related to the exemption request; (iii) agree to promptly

provide, upon request by the Compliance Department, information or

documentation regarding the Person’s exemption application; (iv) agree to

comply with all terms, conditions or limitations imposed by the Compliance

Department with respect to the exemption; (v) agree that the Compliance

Department may modify or revoke the exemption at any time; (vi) agree to
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

4

Attachment C

Copy of the Amended Rules 

(Rules 101, 211 and 407)

Rule 101. Defined Terms

Unless otherwise specified in these Rules or unless the context otherwise requires, the 

terms defined below in this Rule 101 shall for all purposes of these Rules have the 

meanings specified herein.

AAA

The term “AAA” means the American Arbitration Association.

Affiliate

An “Affiliate” of, or a Person “Affiliated” with, another Person means a Person who, 

directly or indirectly, Controls, is Controlled by, or is under common Control with, 

such other Person.

API

The term “API” means application programming interface.

Appeals Panel

The term “Appeals Panel” means a panel appointed by the CCO pursuant to Rule 

716(g).

Applicable Law

The term “Applicable Law” means, with respect to any Person, any statute, law, 

regulation, rule or ordinance of any governmental authority, or self-regulatory 

organization applicable to such Person, including without limitation the CEA, the 

Exchange Act and CFTC Regulations.

Audit Trail

The term “Audit Trail” has the meaning given to that term in Rule 505(a).

Authorized User

The term “Authorized User” means any natural person who is an agent or 

employee of a PFI, a Participant or any other Person that has been authorized to 

access the SEF. In the case a computer or system is used to access the SEF via 
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Commodity Futures Trading Commission

February 27, 2023

5

an API, the natural person designated to be responsible for such computer or 

system’s activity on the SEF shall be the Authorized User.

Beneficial Ownership or Beneficially Owned

The term “Beneficial Ownership,” or an interest “Beneficially Owned” by any 

Person, means, with respect to an account, a direct or indirect (through one or 

more subsidiaries or Affiliates) pecuniary interest in the account (through any 

Swap, arrangement, understanding, relationship or otherwise).

Board

The term “Board” means the Board of Directors of the Company constituted in 

accordance with the LLC Agreement, these Rules and Applicable Law.

Cancel Order

The term “Cancel Order” means an Order that cancels fully or partially an existing 

Order.

Cancel Replace Order

The term “Cancel Replace Order” means an Order to cancel fully or partially an 

existing Order and replace it with a new Order for a different quantity or price.

CFTC

The term “CFTC” means the Commodity Futures Trading Commission and 

includes any successor agency or authority.

CFTC Regulation

The term “CFTC Regulation” means any rule, regulation, order or directive and any 

published interpretation thereof adopted or promulgated from time to time by the 

CFTC.

Chief Compliance Officer

The term “Chief Compliance Officer” (or “CCO”) means the individual appointed by 

the Board from time to time to oversee compliance matters in accordance with 

Rule 211.

Chief Executive Officer

The term “Chief Executive Officer” (or “CEO”) means the individual appointed by 

the Board from time to time to serve as chief executive officer of the Company.
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Commodity Futures Trading Commission

February 27, 2023

6

Chief Operating Officer

The term “Chief Operating Officer” (or “COO”) means the individual appointed by 

the Board from time to time to serve as chief operations officer of the Company.

Cleared Swap

The term “Cleared Swap” means a Swap that is required to be cleared by a DCO 

pursuant to Section 2(h)(1) of the CEA and CFTC Regulation 50.2 (Treatment of 

Swaps Subject to a Clearing Requirement) or is otherwise designated by or on 

behalf of the parties to be submitted to a DCO for clearing, including a New 

Swap/Old Terms or New Swap/Corrected Terms, including any such Swap that is 

rejected from clearing by the applicable DCO. As of the date of this Rulebook, the 

SEF does not offer Cleared Swaps.

Client Account

The term “Client Account” means a Person that has granted investment discretion 

to trade on its behalf.

Commodity Exchange Act

The term “Commodity Exchange Act” (or “CEA”) means the law set forth at 7 

U.S.C. § 1, et. seq.

Company

The term “Company” will be SpectrAxe, LLC.

Company Official

The term “Company Official” means any Officer of, or individual employed directly 

by, the Company or any individual rendering similar services on behalf of the 

Company under a secondment agreement.

Compliance Department

The term “Compliance Department” means the CCO and the individuals under the 

supervision of the CCO who are responsible for enforcing these Rules and 

conducting investigations of alleged violations of these Rules. As the term is used 

herein, the Compliance Department includes: (i) the Company’s compliance staff 

dedicated to enforcing these Rules and performing services directly related to the 

Company’s compliance with Applicable Law and (ii) employees of other divisions 

of the Company or its Affiliates who have certain regulatory responsibilities with 

respect to the Company.
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

7

Control

The term “Control,” including the terms “Controlling,” “Controlled by” and “under 

common Control with,” means the possession, direct or indirect, of the power to 

direct or cause the direction of the management and policies of a Person, whether 

through the ownership of securities or otherwise.

Derivatives Clearing Organization

The term “Derivatives Clearing Organization” (or “DCO”) has the meaning given to 

that term in Section 1a(15) of the CEA. For the avoidance of doubt, the Company 

does not submit Uncleared Swaps to a DCO and does not have any agreement or 

arrangement with a DCO for Uncleared Swaps.

Designated Contact

The term “Designated Contact” means a natural person who is designated, 

pursuant to Rule 416, with the authority to act on behalf of and represent the 

Participant or PFI as applicable. The Designated Contact may, but need not be,

an Authorized User.

Director

The term “Director” means any member of the Board.

Disciplinary Offense

The term “Disciplinary Offense” shall have the meaning set forth in Rule 209(c).

Disciplinary Panel

The term “Disciplinary Panel” means the panel appointed pursuant to Rule 710 to 

conduct hearings in connection with disciplinary proceedings (other than summary 

impositions of fines pursuant to Rule 717), to make findings, render decisions, and 

impose sanctions pursuant to Chapter 7 of the Rules.

Electronic Access

The term “EA” or “Electronic Access” means electronic access to the SEF’s Order 

Book and execution functionality through direct electronic connection.

Eligible Contract Participant

The term “Eligible Contract Participant” has the meaning given to that term under 

Section 1a(18) of the CEA and CFTC Regulations thereunder.
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

8

Emergency

The term “Emergency” has the meaning given to that term in Rule 412(a).

Exchange Act or Securities Exchange Act of 1934

The term “Exchange Act” of “Securities Exchange Act of 1934” means the law set 

forth at 15 U.S.C. § 78a, et. seq.

Final Decision

The term “Final Decision” shall have the meaning set forth in Rule 209(c).

Introducing Agent

The term “Introducing Agent” means a futures commission merchant or introducing 

broker registered with the CFTC, or any Person that is exempt from such 

registration (or not required under Applicable Law to so register). As of the date of 

this Rulebook, Introducing Agents are not permitted on the SEF.

Investigation Report

The term “Investigation Report” has the meaning given to that term in Rule 703.

Legal Entity Identifier

The term “Legal Entity Identifier” means a unique code assigned to swap 

counterparties and entities in accordance with the standards set by the Global 

Legal Entity Identifier System.

Legal Team

The term “Legal Team” means the function of the SEF that is responsible for the 

legal and regulatory affairs of the SEF.

Limits

The term “Limits” means the limits on trading as determined by the relevant PFI, 

including but not limited to, product restrictions and trade volume limits. A PFI may 

set separate Limits for Trades via the Order Book and Trades via an RFQ. A PFI 

may also set Limits on the aggregate exposure it has to another PFI, which shall 

take precedence over any Limits applicable to a Participant. A breach of any such 

Limits (whether applicable to a Participant or a PFI) may prevent a Participant from 

entering into a Trade.
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

9

LLC Agreement

The term “LLC Agreement” means the Limited Liability Company Agreement of 

SpectrAxe, LLC, as amended, supplemented or otherwise modified from time to 

time.

Major Swap Participant

The term “Major Swap Participant” has the meaning given to that term in Section 

1a(33) of the CEA.

Market Data

The term “Market Data” means any and all data and other information contained 

in, displayed on, generated by or derived from the SEF or transactions in Swaps 

entered into pursuant to these Rules, including Orders, RFQs, prices and volumes.

Market Data Vendors

The term “Market Data Vendors” means one or more vendors of financial market 

information which have entered into agreements with the Company to distribute 

Market Data.

Market Maker

The term “Market Maker” means a Participant authorized by the Company to 

participate in the Market Maker Program under Rule 314.

Master Agreement

The term “Master Agreement” means, as applicable, either (a) the 1992 or 2002 

ISDA Master Agreement published by the International Swaps and Derivatives 

Association, Inc. as may be entered into between a PFI and its customer, including 

any Credit Support Annex thereto or; (b) a domestic master agreement (e.g., the 

FBF Master Agreement from the French Banking Federation or the German Master 

Agreement for Financial Derivatives Transactions).

Message Traffic

The term “Message Traffic” means electronic transmissions of Orders, Order 

modifications, Cancel Orders, Cancel Replace Orders, RFQs, trade reports and 

other messages entered into the SEF by or through an Authorized User or sent to 

an Authorized User by the Company. Depending on the context, Message Traffic 

may refer to one-way or two-way transmissions.
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

10

NFA

The term “NFA” means the National Futures Association.

Nominating Committee

The term “Nominating Committee” means the committee of the Board constituted 

pursuant to Rule 203.

Notice to Participants

The term “Notice to Participants” means a communication sent by or on behalf of 

the Company to all Participants, as described in Rule 310.

Officer

The term “Officer” means any officer of the Company.

Order

The term “Order” means an actionable firm bid or offer for a Swap (i) displayed in 

the Order Book, (ii) transmitted as a response to an RFQ, (iii) transmitted by 

acceptance of a response to an RFQ or (iv) any modification thereof. The term 

“Order” does not include an RFQ request nor a response to an RFQ that is not a 

firm bid or offer.

Order Book

The term “Order Book” means the portion of the SEF in which Participants in the 

trading system or platform have the ability to enter Orders designated for the Order 

Book, observe or receive such Orders entered by other Participants, and execute 

such Orders.

Owner

The term “Owner” means any Person holding an ownership interest in the 

Company or defined as a “Member” in the LLC Agreement.

Participant

The term “Participant” refers to Swap Dealers, funds, and other such Persons with 

Trading Privileges. A Participant may be acting as a principal or on behalf of one 

or more Client Accounts, provided that the term “Participant” shall not include any 

such Client Accounts.
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

11

Participant Agreement

The term “Participant Agreement” means the agreement between a Participant and 

SpectrAxe that allows the Participant to access the SEF pursuant to the Rules. 

References to Participant Agreements shall include their addendums, unless 

provided otherwise. As used herein, and unless otherwise required by the context, 

the term “Participant Agreement” also includes PFI Participant Agreements.

Participant Agreement Addendum

The term “Participant Agreement Addendum” (or “the Addendum,” as context 

permits) means the addendum to the Participant Agreement that states, in part, 

various Limits applicable to the Participant.

Participant Committee

The term “Participant Committee” means the committee of the Board constituted 

pursuant to Rule 204.

Participating Financial Institution

The term “Participating Financial Institution” (or “PFI”) means a financial institution 

that has been approved by the Company to enter into the Trades that a Participant, 

with whom the PFI has PFI/Participant Trading Documentation that establishes the 

connection requirement pursuant to Rule 306(a), effectuates on the SEF.

Permitted Transaction

The term “Permitted Transaction” means any transaction not involving a Swap that 

is required by Section 2(h)(8) of the CEA to be executed on, or pursuant to the 

rules of, a swap execution facility or a designated contract market. 

Person

The term “Person” means any natural person, association, partnership, limited 

liability company, joint venture, trust or corporation.

PFI/Participant Trading Documentation

The prime brokerage agreement or other such documentation that governs the 

trading relationship (e.g. Master Agreement) in effect between a Participant and a 

PFI and allows the Participant to satisfy the PFI connection requirement in Rule 

306.
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

12

PFI Facilitation Agreement

The term “PFI Facilitation Agreement” means the agreement between the 

Company and each PFI regarding the settlement of Trades executed by the 

Participants, including the establishment of Limits on the aggregate exposure a 

PFI may have to another PFI through the SEF Platform.

PFI Participant Agreement

The term “PFI Participant Agreement” means the agreement between the 

Company and a Participant that is the same legal entity as a PFI (e.g., a trading 

desk of the PFI), which allows the Participant to access the SEF pursuant to the 

Rules. References to the PFI Participant Agreement shall include their 

addendums, unless provided otherwise.

Pre-Execution Communication

The term “Pre-Execution Communication” means a communication between two 

Persons for the purpose of establishing the terms of an Order prior to entering into 

a Trade, including any communication that involves pre-determination of the size, 

side of market, or price of such an Order; provided that any communication 

between two Persons that involves an agreement to enter into a Trade between 

the parties that legally binds the parties to such Trade shall not be considered a 

Pre-Execution Communication.

Proprietary Account 

The term “Proprietary Account” has the meaning set forth in CFTC Regulation 1.3 

(Definitions).

Proprietary Information

The term “Proprietary Information” has the meaning given to that term in Rule 

1104(d).

Public Director

The term “Public Director” means a director of the Company with the qualifications 

described in Rule 208.

Regulatory Oversight Committee

The term “Regulatory Oversight Committee” means the committee of the Board 

constituted in accordance with Rule 205.
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

13

Reporting Counterparty

The term “Reporting Counterparty” has the meaning set forth in CFTC Regulation 

45.1 (Definitions).

Required Swap Continuation Data

The term “Required Swap Continuation Data” has the meaning given to that term 

in CFTC Regulation 45.1 (Definitions).

Required Swap Creation Data

The term “Required Swap Creation Data” has the meaning given to that term in 

CFTC Regulation 45.1 (Definitions).

RFQ

The term “RFQ” means a request for quote sent in accordance with these Rules.

Rule

The term “Rule” means any rule adopted or amended, from time to time, by the 

Company related to or in respect of the operation of, or business conducted on, 

the SEF.

Security

The term “Security” has the meaning given to that term under Section 3(a)(10) of 

the Exchange Act.

Swap Data Repository

The term “Swap Data Repository” (or “SDR”) means any swap data repository 

registered with the CFTC to which the Company may select to report, as required 

by and in accordance with the CEA and CFTC Regulations, the terms of the Trades 

executed pursuant to these Rules.

Swap Execution Facility

The term “Swap Execution Facility” (or “SEF” or “SEF Platform”) means the swap 

execution facility operated by the Company and registered as such with the CFTC.

SEF Data

The term “SEF Data” means any and all data and other information related to Swap 

activities on the SEF or pursuant to this Rulebook, including but not limited to 

Market Data.
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

14

Settlement Agreement

The term “Settlement Agreement,” shall have the meaning set forth in Rule 209(c).

Standing Committee

The term “Standing Committee” means each of the Nominating Committee, the 

Participant Committee and the Regulatory Oversight Committee.

Swap

The term “Swap” has the meaning given to that term in Section 1a(47) of the CEA 

and in the CFTC Regulations promulgated thereunder (without regard to any 

determination by the Secretary of the Treasury pursuant to Section 1b of the CEA). 

Swap Dealer

The term “Swap Dealer” has the meaning given to that term in Section 1a(49) of 

the CEA.

Terms Incorporated by Reference

The term “Terms Incorporated by Reference” has the meaning given to that term 

in Rule 1101(b)(i).

Trade

The term “Trade” means a Swap transaction that is executed on the SEF Platform 

or subject to the Rules.

Trade Communication

The term “Trade Communication” means a written or electronic confirmation from 

the SEF regarding the status of a Trade (i.e., whether the Trade is confirmed, 

amended or cancelled) and with all necessary economic terms.

Trading Hours

The term “Trading Hours” means, with respect to any Swap, the hours during which 

the SEF is regularly open for the trading of such Swap.

Trading Privileges

The term “Trading Privileges” means the rights associated with allowing a Person 

to enter into Trades, such as allowing that Person’s Authorized Users to enter 

Orders or RFQs, respond to RFQs, enter into Trades and otherwise effect Swap 
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

15

transactions, whether directly or indirectly, on or pursuant to the Rules of the SEF, 

either on that Person’s own behalf or on behalf of Client Accounts.

Uncleared Swap

The term “Uncleared Swap” means a Swap other than a Cleared Swap. As of the 

date of this Rulebook, all swaps executed on the SEF will be an Uncleared Swap.

Underlying Instrument

The term “Underlying Instrument” means, with respect to a Swap, the good, right, 

security, index or other asset or measure which is the subject of that Swap.

Unique Transaction Identifier

The term “Unique Transaction Identifier” or “UTI” shall have the meaning set forth 

in CFTC Regulation 45.5 (Unique Transaction Identifiers).

User ID

The term “User ID” means a unique identification number assigned by the 

Company to an Authorized User.
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

16

Rule 211. Chief Compliance Officer

(a) The Board shall designate an individual to serve as the CCO of the Company. The CCO 

shall:

(i) report directly to the Regulatory Oversight Committee;

(ii) oversee and review the Company's compliance with the Core Principles set forth 

in Section 5h of the CEA and Part 37 of the CFTC Regulations;

(iii) resolve, in consultation with the Board, the Regulatory Oversight Committee or the 

CEO, any conflicts of interest that may arise, including:

(A) conflicts between business considerations and compliance 

requirements, including the requirement that the Company provide 

fair, open and impartial access in accordance with CFTC Regulation 

37.202 (Access Requirements); and

(B) conflicts between the Company's management and members of the 

Board;

(iv) establish and administer written policies and procedures reasonably designed to 

prevent violations of the CEA and CFTC Regulations;

(v) take reasonable steps to ensure compliance with the CEA and CFTC Regulations;

(vi) establish procedures for the remediation of noncompliance issues identified by the 

CCO through Compliance Department reviews, look-backs, internal or external 

audit findings, self-reported errors or validated complaints;

(vii) establish and follow appropriate procedures for the handling, management 

response, remediation, retesting, and closing of noncompliance issues;

(viii) establish and administer a compliance manual designed to promote compliance 

with the applicable laws, rules, and regulations and a written code of ethics 

designed to prevent ethical violations and to promote honesty and ethical conduct;

(ix) supervise the Company's self-regulatory program with respect to trade practice 

surveillance, market surveillance, real-time market monitoring, compliance with 

audit trail requirements, enforcement and disciplinary proceedings, audits, 

examinations, and other regulatory responsibilities with respect to Participants, 

Authorized Users, all Persons using any Participant's User IDs, and all other 

Persons subject to the jurisdiction of the SEF under Rule 301, and, in addition to 
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Commodity Futures Trading Commission

February 27, 2023

17

the foregoing in this Rule 211(a)(ix), exercise supervisory authority over all staff 

acting at the direction of the CCO;

(x) provide any information regarding the Company's self-regulatory program that is 

requested by the Board or the Regulatory Oversight Committee;

(xi) supervise the effectiveness and sufficiency of any regulatory services provided to 

the Company by a regulatory service provider in accordance with CFTC Regulation 

37.204 (Regulatory Services Provided by a Third Party); and

(xii) prepare the Company's annual compliance report, in accordance with CFTC 

Regulation 37.1501 (Chief Compliance Officer), and submit the completed report 

to the Board and CFTC.

(b) No individual disqualified from registration pursuant to Section 8a(2) or 8a(3) of the CEA 

may serve as CCO.
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

18

Rule 407. Price Adjustments, Cancellations and Review of Executed Orders by the 

Company

(a) Adjustment and Cancellation Authority.

The Company may adjust trade prices or cancel executed orders, solely in accordance 

with published policies of the Company, when such action is necessary to mitigate market 

disrupting events caused by: (i) improper conduct such as market manipulation or clearly 

erroneous trading behavior (e.g., fat finger entries) or (ii) malfunctions in the Company's 

systems. If the Company takes any action pursuant to this Rule 407(a), it will do so in a 

commercially reasonable manner, considering whether such price adjustment or 

cancellation will adversely impact market integrity, facilitate market manipulation or other 

illegitimate activity, or otherwise violate the Rules or Applicable Law, and it will give prompt 

notice and in any event will use good faith, commercially reasonable efforts to provide any 

affected Participants and PFIs with reasonable prior notice and, where required by 

Applicable Law (including CFTC Regulation 37.405 (Risk Controls for Trading)), to obtain 

consent to such adjustment or cancellation. Participants shall be responsible for obtaining 

any required consent to such adjustment or cancellation from their Client Account(s), if 

applicable.

(b) Review of Trades Generally.

Subject to Rule 407(c), the Company may initiate a review of a Trade based on its analysis 

of market conditions or in response to a request for review by a Participant. Such request 

for review must be made as soon as practicable but in no event after the end of the 

business day in which such Trade took place. The Company shall promptly determine 

whether the Trade will be subject to review and, upon deciding to review the Trade, the 

Company will promptly issue an alert to the affected Participants and PFIs indicating that 

the Trade is under review. In the case of a Trade determined by the Company to be illiquid, 

the Company may initiate a review on its own initiative if it determines that the trade price 

was significantly out of line with prices in the market at the time of such transaction (based 

on pricing data that is readily available to the Company). In the course of its review of any 

Trade, the Company may, but is not obligated to, inform any of the affected Participants 

and PFIs the identity and contact information of the other affected Participant and PFI.

(c) Trading Errors or Omissions.

The Company provides a Help Desk telephone number and email address to report any 

errors or omissions. Upon receipt of a report of an error or omission, the Company reviews 

the audit trail information and contacts all affected Participants and PFIs to confirm the 

error or omission. If the error or omission is confirmed, the Company follows the 

procedures on trade review noted in Rule 407(b). If the error or omission is not confirmed, 
Mr. Christopher J. Kirkpatrick

Commodity Futures Trading Commission

February 27, 2023

19

the Company contacts the Person that provided the notice to notify the Person that there 

will be no correction to the data previously reported to the SDR.

(d) PFI Cancellation or Modification.

(i) A PFI shall have the right to request a cancellation or modification of any Trade:

(A) that is executed in excess or in violation of a Limit set by the PFI, 

including a Limit on the aggregate exposure it has to another PFI; or

(B) that is executed by or with a Person that was not authorized by the 

PFI under the relevant PFI/Participant Trading Documentation. 

(ii) A PFI must request the cancellation or modification by sending a notice to the 

Company that states the UTI of the Trade (if any) and the reason for cancellation 

or modification. If the Company determines that the cancellation or modification 

satisfies the conditions of this Rule, the Company will cancel or modify the Trade.

(A) Alternatively, a PFI may request the cancellation or modification of a 

Trade by contacting the Help Desk.