International Swaps and Derivatives Association, Inc. 

360 Madison Avenue, 16th Floor 

New York, NY, 10017 

United States of America 

Telephone: (212) 901-6000 

Facsimile: (212) 901-6001 

email: isda@isda.org 

website: www.isda.org 

Eileen A. Donovan 

Received CFrC ~r~Sectlon 

/jd0//) 1 

Acting Secretary of the Commission 

Commodity Futures Trading Commission 

3 Lafayette Center 

1155 21st Street, N.W. 

Washington, D.C. 20581 

July 23, 2007 

• 

COMMENT 

Re: Proposed Clarification to Regulation 18.05, Maintenance ofBooks, 

Records and Reports by Traders, 72 Fed. Reg. 34413 (June 22, 2007) 

Dear Ms. Donovan: 

The International Swaps and Derivatives Association ("ISDA'') is pleased to 

respond to the request of the Commodity Futures Trading Commission ("Commission") for 

comments regarding the above-referenced proposal ("Proposal"). The Proposal seeks to clarify 

the recordkeeping and reporting requirements of Regulation 18.05 with regard to large positions 

in commodity futures and options on futures. In general, we endorse the Commission's proposed 

clarification, which reinforces the Commission's broad surveillance authority over transactions 

that potentially impact the regulated futures markets. 

ISDA, which represents participants in the privately negotiated derivatives 

industry, is the largest global financial trade association, by number of member firms. ISDA was 

chartered in 1985, and today has over 800 member institutions from fifty-four countries on six 

continents. These members include most of the world's major institutions that deal in privately 

negotiated derivatives, as well as many of the businesses, governmental entities, and other end 

users that rely on over-the-counter derivatives to manage efficiently the financial market risks 

inherent in their core economic activities. Information about ISDA and its activities is available 

on its web site at www.isda.org. 

ISDA agrees that Commission access to the proposed position information of 

large traders on reporting markets is important in order for the Commission to effectively 

discharge its anti-manipulation authority. ISDA does not believe that it would be in the public 

NEW YORK • LONDON • SINGAPORE • TOKYO • BRUSSELS • WASHINGTON 

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' lSD A International Swaps and Derivatives Association, Inc. 2 

interest for the Commission to rely on its subpoena power in order to obtain such information on 

a routine basis. In our view, the Proposal does not create additional recordkeeping or reporting 

obligations for traders. 

With respect to the Proposal, we ask that the Commission consider clarifying, to 

the extent appropriate: 

1) that records required to be retained under Regulation 18.05 are subject to Regulation 

1.31, which states, in part, that all required records must be retained for five years and be 

readily accessible during the first two years; 

2) the scope of Regulation 1.35( a), which contains similar record keeping and reporting 

language to Regulation 18.05; and 

3) that records required to be retained under Regulation 18.05 consist of no more than 

accurate records of positions and actual transaction documentation created in the ordinary 

course ofbusiness. 

ISDA appreciates the opportunity to provide these comments and stands ready to 

answer any questions that the Commission might have. 

Sincerely, 

(h~:r.~·· 

Greg Zerzan 

Counsel and Head of Global 

Public Policy