DC\2530679.6

EXHIBIT L

Compliance Chart

Attach as Exhibit L, a narrative and any other form of documentation that may be provided 

under other Exhibits herein, that describes the manner in which the Applicant is able to comply 

with each core principle. Such documentation must include a regulatory compliance chart 

setting forth each core principle and providing citations to the Applicant’s relevant rules, 

policies, and procedures that address each core principle. To the extent that the application 

raises issues that are novel or for which compliance with a core principle is not self-evident, 

include an explanation of how that item and the application satisfy the core principles.

Attached is the following:

• Thomson Reuters (SEF) LLC Compliance Chart
DC\2530679.6

EXHIBIT L

COMPLIANCE CHART1

SWAP 

EXECUTION 

FACILITY CORE 

PRINCIPAL

ELEMENTS OF SWAP 

EXECUTION FACILITY CORE 

PRINCIPAL

TR SEF APPLICATION RELEVANT TR SEF 

APPLICATION 

MATERIALS

Core Principal 1 -

Compliance with 

core principles

(a) In general. To be registered, and 

maintain registration, as a swap 

execution facility, the swap execution 

facility shall comply with—

(1) All core principles described in 

Section 5h of the Act; and

(2) Any requirement that the 

Commission may impose by rule or 

regulation pursuant to Section 8a(5) 

of the Act.

(b) Reasonable Discretion of a 

Swap Execution Facility. Unless 

otherwise determined by the 

Commission by rule or regulation, a 

swap execution facility described in 

paragraph (a) of this section shall 

have reasonable discretion in 

establishing the manner in which the 

swap execution facility complies with 

the core principles described in 

Section 5h of the Act.

The Thomson Reuters (SEF) LLC (“TR SEF”) Swap Execution 

Facility Application dated September 9, 2013 and the exhibits 

thereto (the “Application”) demonstrates how TR SEF will 

comply with the core principles for SEFs and applicable 

Commission regulations. 

All materials submitted with 

the Application.

Core Principal 2 -

Compliance with 

rules

A swap execution facility shall:

(A) establish and enforce compliance 

with any rule of the swap execution 

facility, including-(i) the terms and

conditions of the swaps traded or 

The inside cover of the Rulebook clearly sets forth, and Rule 311 

repeats, that all Participants and Authorized Persons, and the 

Clients and Customers of any Participant, and any ISV agree: 

(1) to be bound by, and comply with, the SEF Rules and 

obligations and Applicable Law, in each case to the extent 

Rulebook (Exhibit M)

Generally

205

301

311

 

1 References herein to a “Rule” refer to the applicable rule in the rulebook submitted as Exhibit M (the “Rulebook”). Terms used but not defined herein have the meanings assigned 

to them in the Rulebook.
3

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TR SEF APPLICATION RELEVANT TR SEF 

APPLICATION 

MATERIALS

processed on or through the swap 

execution facility; and (ii) any 

limitation on access to the swap 

execution facility;

applicable to such Person; (2) to become subject to the 

jurisdiction of the SEF with respect to any and all matters arising 

from, related to, or in connection with, the status, actions or 

omissions of such Person; (3) to permit the SEF and any 

Regulatory Services Provider authorized to act on behalf of the 

SEF to access any and all information relevant to activities 

related to the SEF’s business; (4) to assist the SEF in complying 

with its legal and regulatory obligations, cooperate with the SEF 

and the Commission in any inquiry, investigation, audit, 

examination or proceeding; and 

(5) that the SEF is authorized to provide information regarding 

such Person to the Regulatory Services Provider, the Commission

or any Self-Regulatory Organization. 

The TR SEF Rulebook establishes compliance with the rules of 

the SEF, including, but not limited to: (1) the terms and 

conditions of any swaps traded or processed on or through the 

SEF; (2) access rules for the SEF; (3) trade practice rules; (4) 

audit trail requirements; (5) disciplinary rules; and (6) mandatory 

trading requirements.

The authority of the Market Regulation Department to investigate 

matters within its jurisdiction and the obligations of each 

Participant and Authorized Person to cooperate with such 

investigations are set forth in Rules 1001(b) and 1001(c). Chapter 

5 of the Rulebook sets forth Obligations of Participants and 

Authorized Persons, which include certain disclosure Obligations 

to TR SEF pursuant to Rule 502. Under Rule 503, TR SEF may, 

directly or through the National Futures Association (“NFA”): (1)

inspect a Participant’s systems, equipment and software; (2)

access a Participant’s systems, equipment, software, or premises;

and (3) copy or reproduce certain Participant data. Additionally, 

under Rule 205(e), the Chief Compliance Officer may, directly or 

502

503

1001
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TR SEF APPLICATION RELEVANT TR SEF 

APPLICATION 

MATERIALS

through the NFA, inspect the books and records of any 

Participant or require any Participant to appear before him or her 

and produce its books and records and answer questions 

regarding alleged violations of TR SEF Rules.

As stated in Rule 301, to be eligible for admission as a Participant 

of the SEF, the applicant must demonstrate to the satisfaction of 

the SEF that it is an Eligible Contract Participant and that, if the 

applicant is trading on behalf of other persons, that such persons 

are Eligible Contract Participants. Participants, Associated 

Persons, and the Clients or Customers of any Participant, and 

ISVs, consent to TR SEF's jurisdiction pursuant to Rule 311. 

A swap execution facility shall:

(B) establish and enforce trading, 

trade processing, and participation 

rules that will deter abuses and have 

the capacity to detect, investigate, and 

enforce those rules, including means-

(i) to provide market participants with 

impartial access to the market; and 

(ii) to capture information that may be 

used in establishing whether rule 

violations have occurred;

Prohibited Conduct

Chapter 9 of the Rulebook imposes an extensive set of 

restrictions designed to protect Participants from forms of 

abusive, disruptive, fraudulent, noncompetitive and unfair 

conduct and trade practices. Prohibited conduct and trade 

practices include, but are not limited to, fictitious, wash, or noncompetitive transactions (Rules 906 and 921), trading ahead of 

customer orders (Rules 917 and 918), accommodation trading 

(Rule 918), improper cross-trading (Rule 918), front-running 

(Rule 910), wash trading (Rules 906 and 910), fraudulent trading 

(Rule 905), pre-arranged trading (Rule 921), and other abusive 

trading practices (Rules 905, 907, 908 and 910). Manipulative or 

disruptive trading practices are further prohibited under Rules 

905, 907, 908 and 910.

As stated in Rule 910 (Abusive Trading Practices Prohibited) and 

enforced by the Compliance Manual and Regulatory Services

Agreement with NFA, TR SEF prohibits abusive trading practices 

on its markets by Participants. 

Rulebook (Exhibit M) 

207

211

301

302

304

305

905

906

907

908

910

917

918

920

921

922

1002

1004

1010
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TR SEF APPLICATION RELEVANT TR SEF 

APPLICATION 

MATERIALS

TR SEF Surveillance

TR SEF has, with the assistance of the NFA, implemented a 

compliance program which conducts market surveillance and 

trade practice monitoring on a real-time and T+1 basis. This 

program includes alerts which are triggered in connection with 

off-market trades, total risk from request for quote trades, and 

failed messages to the DTCC. TR SEF’s systems also identify 

issues related to connectivity, system capacity, trade reporting, 

and system errors which may cause disorderly markets. TR 

SEF’s Client Interaction Center (“CIC”) is responsible for 

responding to such alerts, and CIC Managers oversee the process.

In addition, TR SEF coordinates with the NFA to ensure that such 

real-time monitoring is integrated with the NFA’s T+1 

surveillance of potentially disruptive trade practices (e.g., 

manipulation, front-running, wash trading, pre-arranged trading, 

fraudulent trading, money passes). The Market Regulation 

Department supervises the effectiveness of the services provided 

by the NFA.

As a part of its surveillance program, TR SEF maintains all data 

reflecting the details of each order entered into the Platform, 

including: (1) all data that are input into the trade entry or 

matching system for the transaction to match and clear; (2) the 

categories of Participant for which each trade is executed, 

including whether the person executing a trade was executing it 

for his/her own account or an account for which he/she acts as 

agent; (3) timing and sequencing data adequate to reconstruct 

trading; and (4) identification of each account to which fills are 

allocated. The NFA has an automated system that is able to: 

(1)detect and flag specific trade execution patterns and trade 

anomalies; (2) compute, retain, and compare trading statistics; (3) 

compute trade gains, losses, and swap-equivalent positions; (4) 

1011

Swap Execution Facility 

Addendum (Exhibit N-1)

Compliance Manual 

(Exhibit O-2)
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TR SEF APPLICATION RELEVANT TR SEF 

APPLICATION 

MATERIALS

reconstruct the sequence of market activity; (5) perform market 

analyses; and (6) perform in-depth analyses and ad hoc queries of 

trade-related data. 

Rule 211 permits TR SEF to enter into information sharing 

agreements to coordinate surveillance with other markets on 

which financial instruments related to the Contracts are traded.

Investigations and Prosecution

Suspected conduct and trade practice violations will be 

investigated and prosecuted as set forth in Chapter 10 of the 

Rulebook. The decision as to whether to initiate an investigation 

will be made by TR SEF under Rule 1004. The decision as to 

whether to impose sanctions and, if so, the form such sanctions 

should take will be made by TR SEF under Rules 1010 and 1011. 

As stated in Rule 207 (Regulatory Oversight Committee), TR

SEF’s Regulatory Oversight Committee will have the authority to 

oversee all facets of the regulatory program including reviewing 

the size and allocation of the regulatory budget and resources, and 

number, hiring, termination, and compensation of regulatory 

personnel.

As stated in Rule 1002 (Investigations and Investigation Reports), 

TR SEF’s Market Regulation Department will initiate an 

investigation upon the receipt of a request from the Commission

or upon the discovery or receipt of information that, in the 

judgment of the Market Regulation Department, indicates a 

possible basis for finding that a violation has occurred or will 

occur. Absent mitigating circumstances, a Market Regulation 

Department investigation must be completed no later than twelve 

(12) months after the date that such investigation is opened.

As stated in Rule 1011 (Sanctions), TR SEF will impose 
7

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EXECUTION FACILITY CORE 

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TR SEF APPLICATION RELEVANT TR SEF 

APPLICATION 

MATERIALS

sanctions if any Participant or other person using a Participant’s 

Legal Entity Identifier is found to have violated or to have 

attempted to violate a Rule of TR SEF or provision of Applicable 

Law for which TR SEF possesses disciplinary jurisdiction. TR

SEF may impose one or more of the following sanctions or 

remedies: (1) censure; (2) limitation on Trading Privileges, ability 

to otherwise access the Platform, and/or other activities, functions 

or operations; (3) suspension of Trading Privileges and/or ability 

to otherwise access the Platform; (4) fine; (5) restitution or 

disgorgement; (6) termination of Trading Privileges and/or ability 

to otherwise access the Platform; or (7) any other sanction or 

remedy deemed to be appropriate.

Impartial Access

As discussed further in Core Principle 11 (Antitrust 

Considerations), TR SEF will grant access to the SEF in an 

impartial manner. Under Rules 301(i), 302(e), and 304(a), any 

decision to revoke, suspend, deny, limit, condition, restrict, 

terminate, or qualify a Participant’s Trading Privileges and/or 

ability to access the Platform shall be impartially enforced. Under 

Rule 305, fee information will be published by TR SEF from time 

to time. TR SEF’s current fees are set forth in the Swap 

Execution Facility Addendum included as Exhibit N-1 and 

Exhibit K. TR SEF will not privately negotiate fees for access to 

the Platform. 

A swap execution facility shall:

(C) establish rules governing the 

operation of the facility, including 

rules specifying trading procedures to 

be used in entering and executing 

orders traded or posted on the facility, 

including block trades; and

Chapters 6 (Supported Transactions) and 7 (Execution Methods) 

of the Rulebook specify trading procedures to be followed by 

Participants and Clients and Customers of Participants when 

entering and executing orders traded or posted on the Platform, 

including Block Trades. 

The Platform includes a price-time priority order book, a request 

Rulebook (Exhibit M)

Chapter 6

Chapter 7

TR SEF Trading Platform: 

Technical Overview 

(Appendix 1 to Exhibit Q)
8

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TR SEF APPLICATION RELEVANT TR SEF 

APPLICATION 

MATERIALS

for quote system (“RFQ”), and a request for stream system

(“RFS”). TR SEF provides Participants with the ability to post 

both firm quotes onto the order book and to request indicative 

quotes on the RFQ and RFS. Participants must have an agreement 

governing the execution and settlement of Transactions executed 

on the Platform. The methods for transacting Transactions 

through the Platform are shown in Appendix 1 to Exhibit Q (TR

SEF Trading Platform: Technical Overview).

Through the order book, all Participants can enter multiple bids 

and offers, observe bids and offers entered by other market 

participants, and choose to transact on such bids and offers. 

Participants can also choose to enter into a RFQ process with 

other Participants. Additionally, the Platform provides a RFS

process which enables Participants to subscribe to streaming 

quotes from other Participants with whom they have established a 

stream subscription. 

As stated in Rule 602 (Block Trades), TR SEF shall publish the 

list of contracts for which it permits and facilitates the bilateral 

trading and execution of Block Trades on its website. TR SEF 

shall set the minimum block sizes for any newly-listed Swaps 

which are not within the parameters of a category of swap 

instrument for which a registered Swap Data Repository has 

established and published appropriate minimum block sizes in 

accordance with Commission Regulations. TR SEF will publish 

these minimum block sizes in its Rulebook. 

If a transaction is executed as a block trade pursuant to the TR

SEF Rules, then the reporting counterparty must report the swap 

to TR SEF pursuant to Rule 602(c)(7), and TR SEF will report 

the transaction and pricing data to a Swap Data Repository as 
9

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EXECUTION 

FACILITY CORE 

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ELEMENTS OF SWAP 

EXECUTION FACILITY CORE 

PRINCIPAL

TR SEF APPLICATION RELEVANT TR SEF 

APPLICATION 

MATERIALS

soon as technically practicable pursuant to Commission

Regulation § 43.3(a)(2).

A swap execution facility shall:

(D) provide by its rules that when a 

swap dealer or major swap participant 

enters into or facilitates a swap that is 

subject to the mandatory clearing 

requirement of section 2(h) of this 

title, the swap dealer or major swap 

participant shall be responsible for 

compliance with the mandatory 

trading requirement under section 

2(h)(8) of this title.

Rule 504(c) states that Swap Dealers and Major Swap 

Participants are responsible for compliance with the mandatory 

trading requirements under CEA Section 2(h)(8) and Commission

regulations thereunder, and Rule 504(f) states that any Participant 

who violates any CEA provision or Commission Regulation 

referred to in Rule 504, including CEA Section 2(h)(8), shall be 

deemed to have also violated Rule 504. 

Rulebook (Exhibit M) 

504

Core Principal 3 -

Swaps not readily 

susceptible to 

manipulation

The swap execution facility shall 

permit trading only in swaps that are

not readily susceptible to 

manipulation.

Trading on the Platform will initially be limited to nondeliverable forward swaps (“NDFs”) and foreign exchange 

options. 

NDFs are cash settled currency forwards between two 

counterparties used to either hedge or speculate against currencies 

where exchange controls in a particular country make it difficult 

for foreigners to trade in the spot market directly. There is no 

exchange of the underlying currency. Instead, the entire deal is 

settled in a widely traded currency, usually U.S. dollars.

FX Options on NDFs (“NDOs”) are cash settled currency options 

between two counterparties used to either hedge or speculate 

against currencies where exchange controls in a particular 

country make it difficult for foreigners to trade in the spot market 

directly. There is no exchange of the underlying currency. 

Instead, the entire deal is settled in a widely traded currency, 

usually U.S. dollars.

Rulebook (Exhibit M)

Chapter 3 

Chapter 9

Chapter 13

Regulatory Services

Agreement (Exhibit N-2)

TR SEF Contract 

Submissions 13-01, 13-02
10

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EXECUTION FACILITY CORE 

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TR SEF APPLICATION RELEVANT TR SEF 

APPLICATION 

MATERIALS

Both for NDF transactions and NDO transactions, the fixing rate 

determines whether someone makes or loses money on the 

contracted settlement date based on the difference between the 

contracted NDF rate and the prevailing FX spot rate. The fixing

date is the day and time whereby the comparison between the 

NDF rate and the prevailing FX spot rate is made. NDFs and 

NDOs in some currencies are fixed against a daily rate published 

by the relevant central bank of that country while other rates are 

an average of interbank prices displayed on Reuters. Reuters polls 

a panel of banks on their estimate of the exchange rate for each 

currency every day at a particular point based on the local time. 

The top and bottom quarter of estimates are taken out, and then 

the fixing is the average of the remaining estimates. Removing 

the top and bottom set of estimates is meant to guard against 

banks submitting rates that benefit their trading books.

Since there is no exchange of the underlying currency for NDFs 

and NDOs and such transactions are settled in a lead currency 

such as the U.S. dollar or Euro, it is very difficult if not 

impossible to manipulate these NDFs and NDOs. In addition, any 

cash settled swaps will be settled based on a reference price that 

is publicly available on a timely basis. 

FX Options on deliverable currencies are currency options 

between two counterparties used to either hedge or speculate 

against currencies that are not subject to exchange controls. These 

transactions are generally based on major currencies, and are 

based on reference prices that are publicly available on a timely 

basis. Therefore, it is very difficult if not impossible to 

manipulate the FX Options that will be listed on the Platform.

Core Principal 4 -

Monitoring of 

trading and trade 

The swap execution facility shall-

(A) establish and enforce rules or 

terms and conditions defining, or 

Trade Execution Procedures

Chapters 6 (Supported Transactions) and 7 (Execution Methods) 

of the Rulebook specify trading procedures to be followed by 

Rulebook (Exhibit M)

404

Chapter 6 
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APPLICATION 

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processing specifications detailing-(i) trading 

procedures to be used in entering and 

executing orders traded on or through 

the facilities of the swap execution 

facility; and (ii) procedures for trade 

processing of swaps on or through the 

facilities of the swap execution 

facility; and

Participants and Clients and Customers of Participants when 

entering and executing orders traded or posted on the Platform, 

including Block Trades. 

The Platform includes a price-time priority order book, an RFQ, 

and an RFS. TR SEF provides Participants with the ability to post 

both firm quotes onto the order book and to post indicative quotes 

on the RFQ and RFS processes through centralized electronic 

screens accessible to all market participants who have access to 

the swap execution facility. The methods for transacting 

Transactions through the Platform are shown in Appendix 1 to 

Exhibit Q (TR SEF Trading Platform: Technical Overview)

Chapter 9 (Trading Practices and Business Conduct) of the 

Rulebook establishes further procedures for entering and 

executing orders. Rule 902 authorizes TR SEF to adopt 

procedures. Rule 903 establishes the TR SEF business days and 

trading hours. Rules 904-923 set forth rule violations, prohibited 

practices and rules to minimize conflicts of interest. Rules 924-

926 establish rules requiring Participants to comply with position 

limits and position accountability requirements. 

Trade Processing Procedures

Rule 404(a) establishes the process through which Swaps 

executed on the Platform will be confirmed, and states that a 

Trade Communication, together with the Terms Incorporated by 

Reference, shall comprise all of the terms of such Transaction and 

constitute a confirmation for purposes of Commission Regulation 

§ 37.6(b), and shall be deemed to be the “SEF Confirmation”.

Chapter 7 

Chapter 9 

Compliance Manual 

(Exhibit O-2)

Regulatory Services

Agreement (Exhibit N-2)

TR SEF Trading Platform: 

Technical Overview

(Appendix 1 to Exhibit Q)

The swap execution facility shall-

(B) monitor trading in swaps to 

As stated in Rule 207(d), the Regulatory Oversight Committee 

will have the authority to monitor TR SEF’s regulatory program 

Rulebook (Exhibit M)

207
12

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TR SEF APPLICATION RELEVANT TR SEF 

APPLICATION 

MATERIALS

prevent manipulation, price distortion, 

and disruptions of the delivery or cash 

settlement process through 

surveillance, compliance, and 

disciplinary practices and procedures, 

including methods for conducting 

real-time monitoring of trading and 

comprehensive and accurate trade 

reconstructions.

for sufficiency, effectiveness and independence, and to oversee 

all facets of TR SEF’s regulatory program. As stated in Rule 406 

(Monitoring of Trading and Trade Processing), TR SEF will 

monitor trading on the Platforms in order to prevent 

manipulation, price distortion, and disruptions of the delivery or 

cash settlement process through surveillance, compliance, and 

disciplinary practices and procedures, including through the realtime monitoring of trading and comprehensive trade 

reconstruction. 

Subject to the oversight of the Regulatory Oversight Committee, 

the Chief Compliance Officer will oversee the monitoring, 

surveillance and other enforcement functions of TR SEF with the 

support of the Market Regulation Department. The Market 

Regulation Department will consist of TR SEF staff supported by 

NFA personnel. TR SEF has contracted with the NFA, its 

designated Regulatory Services Provider, to perform many of TR

SEF’s trading and market surveillance, audit and investigatory 

functions in accordance with Rule 212. 

These functions will be supported by TR SEF’s technology, 

which will collect, array and transmit bid, offer and other data to 

the NFA. For real-time trade monitoring, TR SEF will have an 

automated system in place to detect certain market anomalies. 

This system includes alerts which are triggered in connection 

with off-market trades, total risk from RFQ trades, and failed 

messages to the DTCC. TR SEF’s systems also identify issues 

related to connectivity, system capacity, trade reporting, and 

system errors which may cause disorderly markets. TR SEF’s 

CIC is responsible for responding to such alerts, and CIC 

Managers oversee the process.

In addition, TR SEF coordinates with the NFA to ensure that such 

212

406

Chapter 10

Regulatory Services

Agreement (Exhibit N-2)

Compliance Manual 

(Exhibit O-2)
13

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real-time monitoring is integrated with the NFA’s T+1 

surveillance of potentially disruptive trade practices (e.g., 

manipulation, front-running, wash trading, pre-arranged trading, 

fraudulent trading, money passes). The Market Regulation 

Department supervises the effectiveness of the services provided 

by the NFA.

Chapter 10 of the Rulebook sets forth the disciplinary and 

enforcement process, which includes steps to inquire into, 

investigate, adjudicate and sanction potential rule violations 

within the disciplinary jurisdiction of TR SEF. The Chief 

Compliance Officer, with assistance from the Market Regulation 

Department, the Disciplinary Panels and Appeal Panels, will take 

part in the prosecution and adjudication of potential violations of 

the Rules as described in Chapter 10. See also Response to Core 

Principal 2 - Compliance with rules.

Core Principal 5 -

Ability to obtain 

information

The swap execution facility shall-

(A) establish and enforce rules that 

will allow the facility to obtain any 

necessary information to perform any 

of the functions described in this 

section;

Chapter 5 (Obligations of Participants) of the Rulebook sets forth 

the requirements of Participants to maintain documents and keep 

documents and information available for inspection by TR SEF or 

the Commission. Rule 502 requires Participants to make certain 

disclosures to TR SEF immediately upon the occurrence of 

certain events. Under Rule 503, TR SEF may, directly or through 

the NFA, inspect a Participant’s systems, equipment and 

software, access a Participant’s systems, equipment, software, or 

premises, and copy or reproduce certain Participant data. In 

addition, Rule 503 authorizes the Market Regulation Department 

to require a Participant to furnish information concerning the 

Participant’s Platform Activity, including furnishing the Terms 

Incorporated by Reference, and/or examine the books and records 

of any Participant. Additionally, under Rule 205(e), the Chief 

Compliance Officer may, directly or through the NFA, inspect the 

Rulebook (Exhibit M)

205

211

502

503
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books and records of any Participant or require any Participant to 

appear before him or her and produce its books and records and 

answer questions regarding alleged violations of TR SEF Rules.

Rule 211 permits TR SEF to enter into information sharing 

agreements to coordinate surveillance with other markets on 

which financial instruments related to the Contracts are traded. 

Pursuant to Rule 211, TR SEF may: (1) provide market 

surveillance reports to the Commission, any Government Agency 

with jurisdiction over the SEF or, as necessary for the SEF to 

comply with its SRO obligations, to other markets; (2) share 

information and documents concerning current and former 

Participants with the Commission, any Government Agency with 

jurisdiction over the SEF or, as necessary for the SEF to comply 

with its SRO obligations, to other markets; (3) share information 

and documents concerning ongoing and completed investigations 

with the Commission, any Government Agency with jurisdiction 

over the SEF or, as necessary for the SEF to comply with its SRO 

obligations, to other markets; and/or (4) require its current or 

former Participants to provide information and documents to the 

SEF at the request of the Commission, any Government Agency 

with jurisdiction over the SEF or, as necessary for the SEF to 

comply with its SRO obligations, other markets.

The swap execution facility shall-

(B) provide the information to the 

Commission on request; 

Under Rule 403(a), TR SEF will keep, or cause to be kept, full, 

complete and systematic records, together with all pertinent data 

and memoranda, of all activities relating to the business of the 

SEF with respect to Swaps. Such records shall include, without 

limitation, timestamps required to be maintained under 

Commission Regulation § 43.3, a complete audit trail for all 

Swaps executed on or subject to the rules of the SEF, 

investigatory files, disciplinary files, and all books and records 

required to be maintained pursuant to the CEA and Commission

Rulebook (Exhibit M)

211

403

503
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TR SEF APPLICATION RELEVANT TR SEF 

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Regulations, including Commission Regulation Part 37. Under 

Rule 403(b), all books and records kept under Rule 403(a),

including audit trail data and reconstructions, shall be made 

available to the Commission in a form, manner and time that is 

acceptable to the Commission, and shall be open to inspection 

and examination by the Commission, the Department of Justice, 

the Securities and Exchange Commission, and by any other 

regulator as authorized by the Commission. Copies of all such 

records shall be provided, at the expense of the SEF, to the 

Commission upon request, by electronic means, in hard copy, or 

both, as requested by the Commission, except that copies of 

records originally created and exclusively maintained in paper 

form may be provided in hard copy only. 

Under Rule 503(e), TR SEF will provide any information in its 

possession to the Commission or the NFA upon request, and may 

share such information with other regulatory organizations, data 

repositories, and reporting services as required by the 

Commission or as otherwise necessary and appropriate to fulfill 

its self-regulatory and reporting responsibilities. 

In addition, under Rule 211(c), TR SEF may disclose to any 

Person or entity information concerning or associated with a 

Participant or other Person that it believes is necessary and 

appropriate in exercising a legal or regulatory function, whether 

or not a formal arrangement governing the disclosure exists or a 

request for information was made.

The swap execution facility shall-

(C) have the capacity to carry out 

such international informationsharing agreements as the 

Commission may require.

Under Rule 211(b), TR SEF may enter into any arrangement with 

any Person or body (including, without limitation, a foreign 

regulatory authority) if TR SEF considers such arrangement to be 

in furtherance of TR SEF’s purpose or duties or any law or 

regulation. TR SEF will enter into international informationRulebook (Exhibit M)

211
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sharing agreements as the Commission may require from time to 

time.

Core Principal 6 -

Position limits or 

accountability

(A) In general. To reduce the 

potential threat of market 

manipulation or congestion, 

especially during trading in the 

delivery month, a swap execution 

facility that is a trading facility shall 

adopt for each of the contracts of the 

facility, as is necessary and 

appropriate, position limitations or 

position accountability for 

speculators.

TR SEF Rules 924-926 relate to position limits and position 

accountability levels. Rule 924 establishes rules regarding 

position limits and aggregation requirements, and Rule 925 

includes exemptions for certain qualified hedging transactions. 

Rule 926 establishes rules regarding position accountability

levels.

TR SEF does not currently set position limits or accountability 

levels for any Contract because it has determined that, at this 

time, setting position limits or accountability levels for Contracts 

on TR SEF is not necessary and appropriate. 

Rulebook (Exhibit M)

924

925

926

TR SEF Rulebook 

Amendment: Submission 

15-05 (Dec. 22, 2015)

(B) Position limits. For any contract 

that is subject to a position limitation 

established by the Commission 

pursuant to section 6a(a) of this title, 

the swap execution facility shall-(i) 

set its position limitation at a level no 

higher than the Commission 

limitation; and (ii) monitor positions 

established on or through the swap 

execution facility for compliance with 

the limit set by the Commission and 

the limit, if any, set by the swap 

execution facility.

None of the Contracts are subject to a position limitation 

established by the Commission pursuant to section 6a(a) of the 

CEA. TR SEF will establish appropriate position limits should 

the Commission promulgate position limits related to the 

Contracts or TR SEF determines that it is necessary and 

appropriate to set position limits.

N/A

Core Principal 7 -

Financial integrity 

of transactions

The swap execution facility shall 

establish and enforce rules and 

procedures for ensuring the financial 

integrity of swaps entered on or 

In General

Section 2(b) of the TR Swap Execution Facility Addendum 

requires all Participants to represent that they are Eligible 

Contract Participants and that, if they are trading on behalf of 

Rulebook (Exhibit M)

301

504 

507 
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through the facilities of the swap 

execution facility, including the 

clearance and settlement of the swaps 

pursuant to section 2(h)(1) of this 

title.

other persons or customers, such persons or customers are 

Eligible Contract Participants. Rule 301(a) also requires 

applicants to demonstrate to the satisfaction of the SEF that they 

meet these qualifications in order to be eligible for admission as a 

Participant.

Pursuant to Rules 504, 507 and 510, TR SEF receives certain 

financial and related information from members. The NFA will 

periodically review Participants’ financial information to ensure 

that they continue to qualify as Eligible Contract Participants.

Mandatory Clearing

TR SEF does not currently facilitate the execution of any Swaps 

subject to mandatory clearing or that are intended to be cleared.

Capacity to Route for Clearing

As demonstrated in Appendix 1 to Exhibit Q (TR SEF Trading 

Platform: Technical Overview), the Platform has the capacity to 

route transactions to LCH for clearing. This is evidenced in the 

LCH agreement. 

510 

Compliance Manual 

(Exhibit O-2)

Swap Execution Facility 

Addendum (Exhibit N-1)

LCH Agreement (Exhibit 

N-9)

Core Principal 8 -

Emergency 

authority

The swap execution facility shall 

adopt rules to provide for the exercise 

of emergency authority, in 

consultation or cooperation with the 

Commission, as is necessary and 

appropriate, including the authority to 

liquidate or transfer open positions in 

any swap or to suspend or curtail 

trading in a swap.

The Rulebook sets forth procedures for decision-making and 

emergency intervention in the market. Rule 209(d) permits the 

Regulatory Oversight Committee (or the CEO or CCO if he or 

she determines that Emergency Rules must be implemented with 

respect to an Emergency before a meeting of the Regulatory 

Oversight Committee can reasonably be convened) to adopt 

Emergency Rules that authorize or require TR SEF, the Board, 

any Committee of the Board, or an Officer to take certain 

Emergency Actions. Under Rule 209(a), the measures available 

to TR SEF in the event of an emergency include the following 

actions: (1) imposing or modifying position limits; (2) imposing 

or modifying price limits; (3) imposing or modifying intraday 

Rulebook (Exhibit M)

209

210

1014
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market restrictions; (4) imposing special margin requirements, 

including working with a Derivatives Clearing Organization to 

impose special margin requirements; (5) ordering the liquidation 

or transfer of open positions in any Contract; (6) ordering the 

fixing of a settlement price; (7) extending or shortening the 

expiration date or the Trading Hours; (8) suspending or curtailing 

trading in any Contract; (9) transferring customer Contracts and 

the margin for such Contracts, or altering any Contract’s 

settlement terms or conditions; (10) if applicable, providing for 

the carrying out of such actions through its agreements with the 

Regulatory Services Provider; or (11) taking market actions as 

may be directed by the Commission. 

Under Rule 209(e), TR SEF is required to use reasonable efforts 

to notify the Commission prior to implementing, modifying or 

terminating any Emergency Rule, and where prior notification is 

not possible or practicable, is required to notify the Commission

as soon as is possible or reasonably practicable, but in no event 

more than twenty-four hours after implementation, modification 

or termination of such Emergency Rule. Under Rule 209(f), any 

decision to take Emergency Action shall be documented, and TR

SEF will explain to the Commission its decision-making process, 

the reasons for using its emergency authority, and how conflicts 

of interest were minimized under Rule 209(g).

In addition, certain circumstances may require emergency 

disciplinary actions that do not conform to the full set of 

procedures provided for in Chapter 10. Such disciplinary actions 

(including suspensions) may be conducted under Rule 1014 when 

the Chief Compliance Officer reasonably believes that such 

emergency disciplinary action is necessary to protect the public or 

the best interests of TR SEF. 
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Emergency Actions taken pursuant to Rule 209 and Emergency 

Disciplinary Actions taken pursuant to Rule 1014 are subject to 

the Conflicts of Interest provisions in Rule 210. 

Core Principal 9 -

Timely publication 

of trading 

information

(A) In general. The swap execution 

facility shall make public timely 

information on price, trading volume, 

and other trading data on swaps to the 

extent prescribed by the Commission.

TR SEF has an agreement with the DTCC to utilize the DTCC's 

Swap Data Repository to make public timely information 

regarding swaps as prescribed in Parts 43 and 45 of the 

Commission’s Regulations.

TR SEF will record and report all data required by

Part 16 of the Commission’s regulations. 

Rulebook (Exhibit M)

Chapter 4

TR SEF Trading Platform: 

Technical Overview

(Appendix 1 to Exhibit Q)

DTCC Contract (Exhibit N6)

(B) Capacity of swap execution 

facility. The swap execution facility 

shall be required to have the capacity 

to electronically capture and transmit 

trade information with respect to 

transactions executed on the facility.

As shown in Appendix 1 to Exhibit Q (TR SEF Trading Platform: 

Technical Overview), the Platform has the capacity to 

electronically capture trade information executed on the facility. 

The POMS, bank stream, and order book trading systems 

electronically send trade information to the Deal Feed service as 

soon as practicable. The Deal Feed service connects to the 

DTCC SDR server (as prescribed by the DTCC) and 

electronically transmits all trade information executed on the 

Platform as soon as practicable.

TR SEF Trading Platform: 

Technical Overview

(Appendix 1 to Exhibit Q)

DTCC Contract (Exhibit N6)

Core Principal 10 -

Recordkeeping and 

reporting

(A) In general. A swap execution 

facility shall-(i) maintain records of 

all activities relating to the business 

of the facility, including a complete 

audit trail, in a form and manner 

acceptable to the Commission for a 

period of 5 years; (ii) report to the 

Commission, in a form and manner 

acceptable to the Commission, such 

Creation and Maintenance of Records

As stated in Rule 403(a) and the Technology Questionnaire, TR

SEF will maintain complete and systematic records of all 

activities relating to the business of the SEF with respect to 

Swaps, including timestamps required to be maintained under 

CFTC Regulation § 43.3, a complete audit trail for all Swaps 

executed on or subject to the rules of the SEF, investigatory files, 

disciplinary files, and all books and records required to be 

maintained pursuant to the CEA and CFTC Regulations, 

Rulebook (Exhibit M)

403

Technology Questionnaire 

(Exhibit V) 

Regulatory Service 

Agreement (Exhibit N-2)
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information as the Commission 

determines to be necessary or 

appropriate for the Commission to 

perform the duties of the Commission 

under this chapter; and (iii) shall keep 

any such records relating to swaps 

defined in section 1a(47)(A)(v) of this 

title open to inspection and 

examination by the Securities and 

Exchange Commission.

including CFTC Regulation Part 37.

As stated in Rule 403(b), all books and records maintained 

pursuant to Rule 403(a) will be kept throughout the life of the 

Swap and for at least five (5) years following the final 

termination of the Swap. Records relating to Swaps shall be 

readily accessible via real time electronic access by the SEF 

throughout the life of the Swap and for two (2) years following 

the final termination of the Swap, and shall be retrievable by the 

SEF within three (3) business days through the remainder of the 

period following final termination of the Swap during which it is 

required to be kept, pursuant to CFTC Regulation § 45.2(e)(1).

Trade-related data is captured by each Platform (i.e., bank stream, 

order book and POMS) and is generated and written to a log file. 

See Exhibit V (Technology Questionnaire).

Reporting to and Inspections by the Commission

All books and records kept pursuant to Rule 403(a), including 

audit trail data and reconstructions, shall be made available to the 

Commission in a form, manner and time that is acceptable to the

Commission, and shall be open to inspection and examination by 

the Commission, the Department of Justice, the Securities and 

Exchange Commission, and by any other regulator as authorized 

by the Commission. Copies of all such records shall be provided, 

at the expense of the SEF, to the Commission upon request, by 

electronic means, in hard copy, or both, as requested by the

Commission, except that copies of records originally created and 

exclusively maintained in paper form may be provided in hard 

copy only.

Audit Trail

As stated in the response to question 5(m) of the Technology 

Questionnaire (Exhibit V), TR SEF has manual and automated 
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processes in place to ensure that all audit trail information is 

captured and securely stored.

As stated in the Regulatory Services Agreement with the NFA, 

TR SEF will work with the NFA in enforcing its audit trail and 

recordkeeping program for all Participants. NFA will enforce TR

SEF's audit trail and recordkeeping requirements by conducting 

any examinations that are necessary.

(B) Requirements. The Commission 

shall adopt data collection and 

reporting requirements for swap 

execution facilities that are 

comparable to corresponding 

requirements for derivatives clearing 

organizations and swap data 

repositories.

Rule 403 (Maintenance of Books and Records by the SEF) 

satisfies the recordkeeping requirements set forth in Commission 

Regulations §§ 37.1001-1003. Rules 401 (Real-Time Public

Reporting Obligations) and 402 (Regulatory Reporting 

Obligations) set forth TR SEF’s procedures for satisfying the 

requirements imposed on SEFs in Commission Regulation Parts 

43 and 45.

Rulebook (Exhibit M)

401

402

403

Core Principal 11 -

Antitrust 

considerations

Unless necessary or appropriate to 

achieve the purposes of this chapter, 

the swap execution facility shall not-

(A) adopt any rules or taking 2 any 

actions that result in any unreasonable 

restraint of trade; or (B) impose any 

material anticompetitive burden on 

trading or clearing.

TR SEF’s rules and business plan have been designed to avoid 

unreasonable restraints of trade or the imposition of any material 

anticompetitive burden on trading, as will the specifications for 

each Contract approved for trading on the Platform.

In particular, access to the Platform will not require the 

acquisition of any equity interest but will be available to a broad 

range and potentially unlimited number of Participants, on a fair, 

equitable and timely basis. 

The CLOB will operate through precise and predetermined 

electronic algorithms, without discrimination among different 

users or user groups. The TR SEF RFS and RFQ platforms both 

permit Participants to interact and trade with any other Participant 

with whom they have an agreement governing the execution and 

settlement of Transactions executed on the Platform.

Rulebook (Exhibit M)

Generally

Technology Questionnaire 

(Exhibit V) 
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TR SEF will disseminate trade information to Participants and to 

the public (through DTCC and compliance with TR SEF’s 

obligations under Part 16 of the Commission’s Regulation) on a 

continuous basis without distinction between different 

Participants.

Core Principal 12 -

Conflicts of interest

The swap execution facility shall-(A) 

establish and enforce rules to 

minimize conflicts of interest in its 

decision-making process; and (B) 

establish a process for resolving the 

conflicts of interest.

TR SEF is a wholly-owned subsidiary of Thomson Reuters, 

which will not be a TR SEF Participant.

The TR SEF Rules minimize conflicts of interest in decisionmaking processes and contain methods to ascertain the presence 

of conflicts of interest and to make decisions in the event of such 

a conflict. Under Rule 210(a), no person that knowingly has a 

“material conflict of interest” between his or her position and the 

SEF may participate in any deliberations or vote involving his or 

her personal interest, subject to certain specified exceptions. 

Additionally, Rule 210(g) provides limitations on the use or 

disclosure of material non-public information gained through the 

performance of duties by Directors, Officers or committee 

members, and requires Directors, Officers and committee 

members to take all appropriate steps to safeguard such 

information. 

The TR SEF Code of Business Conduct and Ethics prohibits TR

SEF employees from trading on the basis of material non-public 

information in breach of a pre-existing duty and from trading on 

the basis of material non-public information that was obtained 

through fraud or deception. Additionally, Rule 1206(d) and the 

TR SEF Code of Business Conduct and Ethics prohibit TR SEF 

and TR SEF employees from using for business or marketing 

purposes any proprietary data or personal information they collect 

Exhibit A

Rulebook (Exhibit M)

210

Chapter 10

1206

Code of Conduct (Exhibit 

O-3)
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or receive, from or on behalf of any Person, for the purposes of 

fulfilling TR SEF’s regulatory responsibilities.

TR SEF will obtain public directors for its Board and committees 

once the Commission finalizes its rule defining public directors 

for SEFs. At that time, TR SEF will ensure that its Board and 

committees include an appropriate number and percentage of 

public directors, as required by Applicable Law. Currently, TR 

SEF’s Board complies with the requirements set forth in 

Commission Regulation § 1.64(b).

TR SEF has a Regulatory Oversight Committee that oversees the 

Platform’s regulatory program on behalf of the Board. The Board 

will delegate sufficient authority, dedicate sufficient resources, 

and allow sufficient time for the Regulatory Oversight Committee 

to fulfill its mandate. The Regulatory Oversight Committee will, 

among other things, assist TR SEF in minimizing actual and 

potential conflicts of interest. 

TR SEF, through the NFA, also maintains a Disciplinary Panel. 

The composition of any Disciplinary Panel will meet the 

applicable requirements of Commission Regulations.

Core Principal 13 -

Financial resources

(A) In general. The swap execution 

facility shall have adequate financial, 

operational, and managerial resources 

to discharge each responsibility of the 

swap execution facility. (B) 

Determination of resource adequacy. 

The financial resources of a swap 

execution facility shall be considered 

to be adequate if the value of the 

financial resources exceeds the total 

TR SEF will maintain financial resources that exceed the

total amount that would enable it to cover its operating costs for a 

one-year period, as calculated on a rolling basis.

Exhibit I includes a balance sheet, statement of income and 

expenses, statement of cash flows, and a statement of sources and 

application of revenues and all notes or schedules thereto, as of 

the most recent fiscal year, as well as a narrative of how the value 

of the financial resources held by TR SEF is at least equal to a 

total amount that would enable it to cover its operating costs for a 

Financial Information 

(Exhibit I)
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amount that would enable the swap 

execution facility to cover the 

operating costs of the swap execution 

facility for a 1-year period, as 

calculated on a rolling basis.

period of at least one year, calculated on a rolling basis, and a 

description of unencumbered, liquid financial assets (i.e. cash 

and/or highly liquid securities) equal to at least six months’ 

operating costs.

Core Principal 14 -

System safeguards

The swap execution facility shall-(A) 

establish and maintain a program of 

risk analysis and oversight to identify 

and minimize sources of operational 

risk, through the development of 

appropriate controls and procedures, 

and automated systems, that-(i) are 

reliable and secure; and (ii) have 

adequate scalable capacity; (B) 

establish and maintain emergency 

procedures, backup facilities, and a 

plan for disaster recovery that allow 

for-(i) the timely recovery and 

resumption of operations; and (ii) the 

fulfillment of the responsibilities and 

obligations of the swap execution 

facility; and (C) periodically conduct 

tests to verify that the backup 

resources of the swap execution 

facility are sufficient to ensure 

continued-(i) order processing and 

trade matching; (ii) price reporting; 

(iii) market surveillance and (iv) 

maintenance of a comprehensive and 

accurate audit trail.

Materials submitted with Appendix 1 to Exhibit Q (TR SEF 

Trading Platform: Technical Overview) explain the controls to be 

used to ensure the proper function, adequate security and capacity 

of automated trading systems and related systems such as those 

used for dissemination of market data and recording and safe 

storage of audit trail information. These controls include periodic, 

objective testing and review of automated systems to ensure that 

these systems are reliable, secure and have adequate scalable 

capacity. Results of such testing are retained as described with 

respect to Core Principle 10 (Recordkeeping and reporting).

Compliance with these policies is under the supervision of the 

Chief Compliance Officer.

TR SEF maintains a business continuity / disaster recovery plan 

as explained in the Technology Questionnaire. 

The SEF may take Emergency Actions under Rule 209

(Emergency Rules). See also Response to Core Principal 8 

(Emergency Authority).

Additionally, under Rule 204 (Qualifications of Directors, 

Disciplinary Panel Members, Appeal Panel Members, Committee 

Members, Owners and Officers), the members of the Board will 

have sufficient expertise in financial services and risk 

management.

Rulebook (Exhibit M)

204

209

TR SEF Trading Platform: 

Technical Overview

(Appendix 1 to Exhibit Q)

Technology Questionnaire 

(Exhibit V) 

Core Principal 15 - (A) In general. Each swap execution Under Rule 203 (Officers), the Board shall appoint a Chief Rulebook (Exhibit M)
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Designation of chief 

compliance officer

facility shall designate an individual 

to serve as a chief compliance officer.

Compliance Officer. As stated in Rule 205 (Chief Compliance 

Officer), the Chief Compliance Officer shall have the authority 

and resources to develop and enforce policies and procedures 

necessary to fulfill the duties set forth in the Rules as well as set 

forth in the CEA and Commission Regulations. Pursuant to Rule 

205(f) the Chief Compliance Officer may not be disqualified 

from registration pursuant to Sections 8a(2) or 8a(3) of the CEA.

203

205

(B) Duties. The chief compliance 

officer shall-(i) report directly to the 

board or to the senior officer of the 

facility; (ii) review compliance with 

the core principles in this subsection; 

(iii) in consultation with the board of 

the facility, a body performing a 

function similar to that of a board, or 

the senior officer of the facility, 

resolve any conflicts of interest that 

may arise; (iv) be responsible for 

establishing and administering the 

policies and procedures required to be 

established pursuant to this section; 

(v) ensure compliance with this 

chapter and the rules and regulations 

issued under this chapter, including 

rules prescribed by the Commission 

pursuant to this section; and (vi) 

establish procedures for the 

remediation of noncompliance issues 

found during compliance office 

reviews, look backs, internal or 

external audit findings, self-reported 

errors, or through validated 

As stated in Rule 205 (Chief Compliance Officer), the Chief 

Compliance Officer shall: (1) report directly to the Board; (2) 

oversee and review TR SEF’s compliance with Section 5h of the 

CEA and any related rules adopted by the Commission; (3) 

consult with the Board, resolving any conflicts of interest that 

may arise; (4) establish and administer written policies and 

procedures reasonably designed to prevent violation of the CEA 

and any rules adopted by the Commission; (5) ensure compliance 

with the CEA and Commission Regulations relating to 

agreements, contracts, or transactions, and with Commission

Regulations under Section 5h of the CEA; and (6) establish 

procedures for the remediation of noncompliance issues identified 

by the Chief Compliance Officer through a compliance office 

review, look-back, internal or external audit finding, self-reported 

error, or validated complaint.

Rulebook (Exhibit M)

205
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complaints.

(C) Requirements for procedures. 

In establishing procedures under 

subparagraph (B)(vi), the chief 

compliance officer shall design the 

procedures to establish the handling, 

management response, remediation, 

retesting, and closing of 

noncompliance issues.

As stated in Rule 205 (Chief Compliance Officer), the Chief 

Compliance Officer shall establish and follow appropriate 

procedures for the handling, management response, remediation, 

retesting, and closing of noncompliance issues.

Rulebook (Exhibit M)

205

(D) Annual reports. 

(i) In general. In accordance with 

rules prescribed by the Commission, 

the chief compliance officer shall 

annually prepare and sign a report 

that contains a description of-(I) the 

compliance of the swap execution 

facility with this chapter; and (II) the 

policies and procedures, including the 

code of ethics and conflict of interest 

policies, of the swap execution 

facility.

(ii) Requirements. The chief 

compliance officer shall-(I) submit 

each report described in clause (i) 

with the appropriate financial report 

of the swap execution facility that is 

required to be submitted to the 

Commission pursuant to this section; 

and (II) include in the report a 

certification that, under penalty of 

law, the report is accurate and 

complete.

As stated in Rule 205(g), the Chief Compliance Officer shall 

annually prepare and sign a report that contains a description of: 

(i) the compliance of TR SEF with the CEA; and (ii) the policies 

and procedures, including the code of ethics and conflict of 

interest policies, of TR SEF. Such annual report shall include a 

certification that, under penalty of law, it is accurate and 

complete.

Rulebook (Exhibit M)

205
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