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U.S. COMMODITY FUTURES TRADING COMMISSION

Three Lafayette Centre

1155 21st Street, NW, Washington, DC 20581

Telephone: (202) 418-5000

Facsimile: (202) 418-5521

www.cftc.gov

CFTC Letter No. 13-68

No-Action

November 1, 2013

Division of Market Oversight

Extension of Certain Time-Limited No-Action Relief Regarding Swap Execution Facilities 

Provided by CFTC No-Action Letter Nos. 13-55 (amended), 13-56 and 13-58 for Swaps in 

the Foreign Exchange Asset Class

Background

The Division of Market Oversight (“Division”) is issuing this extension of no-action relief to 

products in the foreign exchange (“FX”) asset class1, including, but not limited to, FX forwards, 

options and Non-deliverable forwards (“NDFs”)2and only to the extent further described below. 

From September 27, 2013 to September 30, 2013 the Division issued no-action letters providing 

temporarily registered swap execution facilities (SEFs) and counterparties executing transactions 

on or pursuant to the rules of such SEFs with time-limited relief from certain requirements of

Parts 37, 43 and 45 of the Commission’s regulations. The Division is issuing this letter to 

address the concerns of FX market participants3and provide limited extensions, as further 

specified below of certain no-action relief provided in CFTC Letter Nos. 13-55 (amended),

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13-

56 and 13-58. 

Extended relief is justified in the FX asset class as FX transactions involve certain additional 

templates and agreements that are not included in the swap contract formation for products in the 

other asset classes. As such, additional time is necessary for SEFs to collect, analyze and 

determine what elements of these industry-accepted contracts, templates and definitions that will

 

1 The Division reminds market participants that with respect to the FX asset class, foreign exchange options, foreign 

exchange rate options, foreign exchange forwards, foreign exchange swaps, and non-deliverable forwards are 

reportable under part 45. Any FX swaps or forwards exempted by the United States Department of the Treasury are 

to be reported consistent with the requirements of Part 43. All other transactions in the FX asset class, including 

those for foreign exchange options, foreign exchange rate options, and non-deliverable forwards, are subject to Part 

43 reporting and public dissemination requirements. See CFTC Fact Sheet “Reporting of Swap Transaction and 

Pricing Data to SDRs” available at 

http://www.cftc.gov/ucm/groups/public/@newsroom/documents/file/reportingswap_factsheet_final.pdf. 

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In its October 29, 2013 letter, GFMA noted that over 40 percent of FX NDFs and 24 percent of FX options are 

traded on or through multiple-to-multiple electronic broking systems. See GFMA Letter (October 29, 2013).

3 This Division letter is in part responsive to a letter requesting extensions of CFTC Letter Nos. 13-55 (amended), 

13-56 and 13-58. See Letter from Global FX Division of the Global Financial Markets Association (“GFMA”) 

“Request for Relief Relating to Commission Regulation Part 37 for Foreign Exchange Asset Class” (“GFMA 

Letter”) (October 29, 2013). 

4 CFTC Letter No. 13-55 was amended on September 30, 2013 to change three references to primary economic 

terms or “PET” data in the original letter to “creation” data.
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be incorporate into the SEF’s platform. Once this process is completed, programming, testing 

and implementing the necessary modifications is necessary.

Discussion

I. CFTC Letter No. 13-55 (amended) (Time-Limited No-Action Relief for Temporarily 

Registered Swap Execution Facilities from Certain Swap Data Reporting Requirements of 

Parts 43 and 45 of the Commission’s Regulations).

The Division issued CFTC Letter No. 13-55 in response to requests from a number of SEFs for a 

transitional period to allow time to complete programming and architectural changes necessary 

for reporting of certain classes of swap transactions to the appropriate swap data repository or 

repositories (“SDR” or “SDRs”) in order to comply with obligations under Parts 43 and 45 of the 

Commission’s regulations. The Division understands that implementation efforts are ongoing 

and that SEFs continue to have concerns regarding their ability to comply fully with Parts 43 and 

45. Relief provided under CFTC Letter No. 13-55 (amended) for swap transactions in the FX 

asset class transacted on or pursuant to the rules of a SEF expired at 12:01 a.m. on October 30, 

2013. Accordingly, the Division believes that a tailored and time-limited extension of relief is 

appropriate.

The Division is extending the relief provided in CFTC Letter No. 13-55 (amended), under the 

terms and conditions5contained in that letter. The period of relief for FX swaps is extended 

until the earlier of: 1) such time as the SEF can report the required swap transaction data to an 

SDR in the manner and timing as set forth in Parts 43 and 45; or 2) 12:01 a.m. eastern time on 

November 29, 2013.

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The no action relief provided in this letter applies only to entities that have achieved temporary 

registration status as SEFs as of the date of issuance of this Division letter.

As indicated above, in order to rely on the relief provided in this letter, a SEF must continue to 

comply with all conditions for relief included in Letter No. 13-55 (amended), with the exception 

of two conditions which contained specific deadline dates for the performance of the conditions. 

By this letter, the Division is adjusting those dates to accommodate the general extension of the 

relief provided in Letter No. 13-55. Accordingly, a SEF intending to rely on the relief provided 

in this Division letter must again comply with condition (4) of CFTC Letter No. 13-55 

(amended) within 10 days of the issuance of this letter. Likewise, with respect to condition (6) 

of CFTC Letter No. 13-55 (amended), the SEF must backload and report to the appropriate SDR 

all required Part 45 creation data and Part 43 data, for the period from October 2, 2013, to 

 

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For ease of reference, the Division is attaching to this letter a copy of CFTC Letter No. 13-55 (amended).

6 This Division letter in no way modifies the relief provided in CFTC Letter No. 13-55 (amended) with respect to 

swaps in the other commodity and equity asset classes.
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November 28, 2013, that it would have been required to report pursuant to Parts 43 and 45 in the 

absence of no-action relief, no later than December 27, 2013.

The Division also is extending the period of relief provided to a SEF that is unable to comply 

with section 43.3(b)(3) (the “embargo rule” - prohibiting disclosure of swap transaction data 

prior to transmission of the data by the SEF to the appropriate SDR) in situations where the SEF 

discloses swap transaction and pricing data to its market participants in contradiction to the 

embargo rule. This relief is granted for affected swap transactions in the FX asset class only, if 

no transmittal of such data to an SDR occurs as a result of the SEF’s reliance on Condition 1(a) 

or 1(b) of CFTC Letter No. 13-55 (amended). Such relief is provided until the earlier of (1) such 

time as the SEF can report the required swap transaction data to an SDR in the manner and 

timing as set forth in Parts 43 and 45; or (2) 12:01 a.m. eastern time on November 29, 2013.

II. CFTC Letter No. 13-56 (Time Limited No-Action Relief for Reporting Counterparties 

from Certain Continuation Data Reporting Requirements of Section 45.4 of the 

Commission’s Regulations with respect to Uncleared Swaps Executed on or Pursuant to the 

Rules of a Temporarily Registered Swap Execution Facility).

The Division issued CFTC Letter No. 13-56 in part to address market participants’ concerns that 

operational challenges faced by temporarily registered SEFs will impede the ability of reporting 

counterparties to report full, complete, accurate and timely continuation data as required in Part 

45 for uncleared swaps executed on or pursuant to the rules of a registered SEF. The Division 

understands that while SEF implementation efforts have progressed during the initial period of 

no-action relief, such efforts are ongoing and market participants continue to have concerns 

regarding their ability to report swap continuation data for SEF executed uncleared FX swaps. 

Relief for swap transactions in the FX asset class under CFTC Letter No. 13-56 expired on 

October 29, 2013. Accordingly, the Division believes that a tailored and time limited extension 

of relief is appropriate.

The Division is extending the relief provided in CFTC Letter No. 13-56, under the terms and 

conditions7contained in that letter8, with respect to swaps within the FX asset class only, until 

the earlier of: 1) such time as the Reporting Counterparty9can fulfill its continuation data 

reporting obligations under Parts 43 and 45; or 2) 12:01 a.m. eastern time on November 29, 

2013.

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For ease of reference, the Division is attaching to this letter a copy of CFTC Letter No. 13-56.

8 With respect to condition (2) of CFTC Letter No. 13-56, a Reporting Counterparty’s failure to report required swap 

continuation data must result from a temporarily registered SEF’s reliance on the no-action relief provided in section 

I of this Division letter.

9 As defined in Commission regulation 45.1.

10 This Division letter in no way modifies the no-action relief provided in CFTC Letter No. 13-56 with respect to 

swaps in the other commodity and equity asset classes.
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III. CFTC Letter No. 13-58 (Time-Limited No-Action Relief to Temporarily Registered Swap 

Execution Facilities from Commission Regulation 37.6(b) for Non-Cleared Swaps in All 

Asset Classes).

The Division issued CFTC Letter No. 13-58 in response to requests received from multiple 

parties, including temporarily registered SEFs, to provide time-limited no-action relief for SEFs 

from providing confirmations, as required under Commission regulation 37.6(b), for swaps that 

are not intended to be submitted for clearing. The Division was informed that SEFs were unable 

to obtain “all the information necessary to capture all of the terms of the transaction...” and that 

additional time was needed to incorporate confirmation documentation relating to swaps that 

have certain non-standardized terms. The Division understands that efforts to implement SEF 

confirmations are still ongoing and that challenges remain with respect to the SEFs’ ability to 

comply with regulation 37.6(b) for FX swaps. Accordingly, the Division believes that a tailored 

and time limited extension of relief is appropriate. 

The Division is extending the relief provided in CFTC Letter No. 13-58, under the terms and 

conditions11 contained in that letter, with respect to FX swaps only, until 12:01 a.m. eastern 

time on November 29, 2013.12

IV. Conclusion

The Division is extending certain relief provided in CFTC Letter Nos. 13-55(amended), 13-56

and 13-58, to the extent and for the durations noted above, with respect to swap transactions in 

the FX asset class only. No other relief is being provided in this Division letter, nor does this 

letter otherwise supersede, suspend, alter, amend or extend any relief provided in CFTC Letter

Nos. 13-55 (amended), 13-56 and 13-58, including relief for swap transactions not in the FX 

asset class that has not yet expired. 

The no-action relief provided herein contains a collection of information, as that term is defined 

in the Paperwork Reduction Act.13 No-action relief letters are covered by collection 3038-0049. 

In addition Part 45 recordkeeping and reporting obligations are covered by collections 3038-

0088 and 3038-0096. 

The Division’s letter and the no-action positions taken herein reflect the views of the Division 

only, and not necessarily the position or views of the Commission or of any other division or 

office of the Commission’s staff. The no-action positions taken herein do not excuse affected 

persons from compliance with any other applicable requirements of the CEA or the regulations 

thereunder. As with all no-action letters, the Division retains the authority to, in its discretion, 

 

11 For ease of reference, the Division is attaching to this letter a copy of CFTC Letter No. 13-58.

12 This Division letter in no way modifies the relief provided in CFTC Letter No. 13-58 with respect to swaps in the 

other commodity and equity asset classes.

13 44 U.S.C. §§ 3501 et. seq.
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further condition, modify, suspend, terminate or otherwise restrict the terms of the no-action 

relief provided herein.

If you have any questions concerning this correspondence, please contact the following Division 

of Market Oversight staff: Nancy Markowitz, Deputy Director at (202) 418-5453 or 

nmarkowitz@cftc.gov, Laurie Gussow, Special Counsel at (202) 418-7623 or 

lgussow@cftc.gov or Stuart Armstrong, Special Counsel at (202) 418-5095 or 

sarmstrong@cftc.gov.

Sincerely,

________________________

Vincent A. McGonagle

Director

Division of Market Oversight