UNITED STATES OF AMERICA 

Before the 

COMMODITY FUTURES TRADING COMMISSION 

In the Matter of the Exemption of Multilateral 

Trading Facilities and Organised Trading Facilities 

Authorized Within the European Uniqn 

from the Requirement to Register with the Commodity 

Futures Trading Commission as Swap Execution Facilities 

ORDER OF EXEMPTION 

Commodity Exchange Act ("CEA") section 5h(g) authorizes the Commodity Futures 

Trading Commission ("Commission") to exempt, conditionally or unconditionally, a swap 

execution facility ("SEF") from registration under CEA section Sh if the Commission finds that 

the facility is "subject to comparable, comprehensive supervision and regulation on a 

consolidated basis by ... the appropriate governmental authorities in the home country of the 

facility." 

Whereas, multilateral trading facilities and organised trading facilities are trading venue 

categories under European Union ("EU") law; 

Whereas, a "multilateral trading facility" or "MTF" is defined in Article 4(1)(22) of the 

amended Markets in Financial Instruments Directive ("MiFID II") as "a multilateral system, 

operated by an investment firm or a market operator, which brings together multiple third-party 

buying and selling interests in financial instruments - in the system and in accordance with nondiscretionary rules - in a way that results in a contract in accordance with Title II of [MiFID II];" 

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Whereas, an "organised trading facility" or "OTF" is defined in Article 4(1)(23) of 

MiFID II as "a multilateral system which is not a regulated market or an MTF and in which 

multiple third-party buying and selling interests in ... derivatives are able to interact in the system 

in a way that results in a contract in accordance with Title II of [MiFID II];" 

Whereas, legal acts of the EU, including in particular MiFID II, the Markets in Financial 

Instruments Regulation ("MiFIR") and the Market Abuse Regulation ("MAR"), establish EUwide requirements with respect to MTFs and OTFs; 

Whereas, MiFIR and MAR are regulations whose requirements apply directly and 

uniformly to MTFs and OTFs in all EU Member States; 

Whereas, MiFID II is a directive that sets forth objectives, including objectives with 

respect to the regulation ofMTFs and OTFs, that must be adopted or "transposed" by EU 

Member States into their national law; 

Whereas, the Directorate-General for Financial Stability, Financial Services and Capital 

Markets Union ("DG FISMA") is the department of the European Commission ("EC") 

responsible for EU policy on banking and finance; 

Whereas, Commission staff has engaged in extensive and ongoing communications with 

DG FISMA staff to understand more fully both the EU-wide requirements that apply with 

respect to MTFs and OTFs, as well as the mechanisms whereby implementation of such 

requirements will be supervised and enforced by the EC, and compliance with such requirements 

will be supervised and enforced by the appropriate governmental authorities in the home 

countries in which MTFs and OTFs are authorized; 

Whereas, based on the information and representations provided by DG FISMA staff, the 

Commission has determined that there are appropriate and effective mechanisms to ensure 

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consistent application within the individual EU Member States of the EU-wide requirements that 

apply with respect to MTFs and OTFs, such that these EU-wide requirements can fairly serve as 

the basis for determining whether, in accordance with the standard set forth in CEA section 

5h(g), MTFs and OTFs that are authorized within the EU are subject to comparable, 

comprehensive supervision and regulation on a consolidated basis by the appropriate 

governmental authorities within their respective home countries; and 

Whereas, based on the information and representations provided by DG FISMA staff, 

regarding the EU-wide requirements that apply with respect to MTFs and OTFs, the Commission 

has determined that, when evaluated against the regulatory and supervisory regime that applies 

with respect to SEFs under the CEA and the Commission's regulations, MTFs and OTFs that are 

authorized within the EU are subject to comparable, comprehensive supervision and regulation 

on a consolidated basis by the appropriate governmental authorities within their respective home 

countries; 

Therefore, the Commission has determined that the respective regulatory frameworks for 

MTFs and OTFs satisfy the statutory standard set forth in CEA section 5h(g) for granting an 

exemption from the SEF registration requirement. 

Whereas, DG FISMA staff has requested an exemption from the SEF registration 

requirement, pursuant to CEA section 5h(g), on behalf of the MTFs and OTFs listed in Appendix 

A to this Order, and has represented that each such MTF and OTF will, as of January 3, 2018, be 

authorized and in good standing in an EU Member State that has completed its transposition of 

MiFID II requirements; 

Whereas, pursuant to the determination made in this Order that the respective regulatory 

frameworks for MTFs and OTFs satisfy the standard, set forth in CEA section 5h(g), for granting 

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an exemption from the SEF registration requirement, DG FIS MA staff may request to amend the 

list in Appendix A to include additional MTFs or OTFs that are authorized and in good standing 

in an EU Member State that has completed its transposition of MiFID II requirements; and 

Whereas, DG FISMA has represented to the Commission that: 

(1) DG FISMA will instruct the EU Member State national competent authorities who 

authorized the trading venues included on the Commission's list of exempted MTFs 

and OTFs to notify the Commission, within ten business days, when an MTF or OTF 

included on such list becomes ineligible for inclusion because it is no longer 

authorized by the relevant national competent authority; 

(2) DG FISMA will provide the Commission with notice of any decision to refer an EU 

Member State to the Court of Justice of the European Union in application of Article 

258 of the Treaty on the Functioning of the European Union, in connection with any 

matter related to MTFs or OTFs, or any EU requirement that is applicable to MTFs or 

OTFs, within ten business days of the effective date of such decision being taken; 

(3) DG FISMA will inform the Commission, as soon as DG FISMA is aware, of any 

material changes to the status of a Member State, as it pertains to its membership 

within the EU; and 

( 4) DG FIS MA will provide the Commission with notice, and copies in the English 

language of the text, of any material change to MiFID II, MiFIR, MAR, or any other 

EU regulatory requirement that is applicable to MTFs or OTFs. 

Accordingly, the Commission hereby exercises its discretion pursuant to CEA section 

5h(g) and ORDERS that each of the MTFs and OTFs listed in Appendix A to this Order, as such 

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Appendix may be amended by the Commission from time to time, is exempt from the 

requirement to register as a SEF pursuant to CEA section Sh; 

Therefore, transactions involving swaps that are subject to CEA section 2(h)(8) may be 

executed on an MTF or OTF listed in Appendix A to this Order, as such Appendix may be 

amended by the Commission from time to time; and 

Therefore, transactions involving swaps that are not subject to CEA section 2(h)(8) also 

may be executed on an MTF or OTF listed in Appendix A to this order, as such Appendix may 

be amended by the Commission from time to time. 

The Commission reserves the right to enter into appropriate memoranda of understanding 

or similar arrangements with EU Member State national competent authorities that have 

jurisdiction over any MTF or OTF that falls within the scope of this Order. 

In the event of any changes in the material facts or circumstances pursuant to which this 

Order is issued, or for any reason in the Commission's discretion, and after appropriate notice to 

DG FISMA and the relevant MTF(s) and/or OTF(s) listed in Appendix A to this Order (as such 

Appendix may be amended by the Commission from time to time), and opportunity for DG 

FISMA and such MTF(s) and/or OTF(s) to respond, the Commission may modify, condition, 

suspend, terminate or otherwise restrict the terms of this Order, as appropriate and permitted by 

law, on the Commission's own motion. 

This Order does not affect any other requirements under the CEA or the Commission's 

regulations. The Commission particularly emphasizes that the following requirements continue 

to apply: 

(1) The reporting requirements set forth in Parts 43 and 45 of the Commission's 

regulations continue to apply to counterparties that are subject to such reporting 

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requirements, in connection with swap transactions executed on an MTF or OTF that 

is exempt from SEF registration pursuant to this Order; 

(2) This Order will not affect the application of CEA section 2( e ), under which it is 

unlawful for any U.S. person, other than an eligible contract participant as defined in 

CEA section la(18), to enter into a swap unless the swap is entered into on, or subject 

to the rules of, a designated contract market. 

(3) The following clearing-related requirements will continue to apply to swap 

transactions executed on an MTF or OTF that is exempt from SEF registration 

pursuant to this Order: 

L When a swap transaction executed by a U.S. person on such an MTF or OTF 

is a "customer" position subject to CEA section 4d, the transaction, if intended 

to be cleared, must be cleared through a Commission-registered futures 

commission merchant ("FCM") at a Commission-registered derivatives 

clearing organization ("DCO"); 

11. When a swap transaction executed by a U.S. person on such an MTF or OTF 

is a "proprietary" position under Commission Regulation l .3(y), the 

transaction, if intended to be cleared, must be cleared either through a 

Commission-registered DCO or a clearing organization that has been 

exempted from DCO registration by the Commission pursuant to CEA section 

5b(h) (an "Exempt DCO"); and 

m. When a swap transaction is subject to the Commission's clearing requirement 

under Part 50 of the Commission's regulations, and is entered into by a person 

that, pursuant to CEA section 2(h)(l ), is subject to such clearing requirement, 

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the transaction must be cleared either through a Commission-registered DCO 

or an Exempt DCO; provided that, consistent with (i) above, if the transaction 

is a "customer" position subject to CEA section 4d, it must be cleared through 

a Commission-registered FCM at a Commission-registered DCO, and cannot 

be cleared through an Exempt DCO. 

If, as a result of the clearing arrangements that such an MTF or OTF has in place, 

some swap transactions executed on the MTF or OTF are cleared by a clearing 

organization that is not a Commission-registered DCO, the MTF or OTF must, as a 

condition of exemption from SEF registration pursuant to this Order, have a rule in its 

rulebook that requires the types of swap transactions described in clauses (i), (ii) and 

(iii) above, if intended to be cleared, to be cleared in a manner consistent with the 

requirements described in clauses (i), (ii) and (iii), respectively. 

This Order shall become effective as of January 3, 2018. 

Issued in Washington, DC, on this 8th day of December, 2017. 

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By the Commission. 

Christopher J. i rkpatrick 

Secretary of the Commission 
Appendix A 

List of MTFs and OTFs that are authorized and in good standing within the EU that are 

subject to this Exemption Order 

Trading Venue Name and Category (MTFs, OTFs) 

Bloomberg Multilateral Trading Facility Limited (MTF) 

BGC Brokers LP (OTF) 

Dowgate (MTF) 

EBS MTF (MTF) 

GFI Brokers Limited (OTF) 

ICAP Global Derivatives (MTF) 

ICAP Securities (OTF) 

ICAP WCLK (MTF) 

iSWAP (MTF) 

NEX SEF Limited (MTF) 

Sunrise Brokers LLP (OTF) 

Trad-X (MTF) 

Tradeweb Europe Limited (MTF) 

Tradition (OTF) 

Tullett Prebon Europe (OTF) 

Tullett Prebon Europe (MTF) 

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