The CFTC’s Division of Market Oversight has issued a letter requiring market participants to comply with large trader reporting rules approved earlier this year. The letter also provides temporary relief from full compliance while the Division launches it XML-based reporting system. The final rule concerning large trade reporting requirements was proposed under the Dodd-Frank Act, and was passed in late July.
The letter states that clearing organizations and clearing members are required to begin reporting using the new system on November 21, 2011. The large trader reporting system is to be used to record information on physical commodity swaps and swaptions. The Division has stated that clearing organizations and clearing members must begin submitting month-end open interested reports first collected during September 2011 to be submitted to the Commission by March 20, 2012.
However, the Division has extended a temporary and conditional “safe harbor” for firms who are not fully compliant while it launches the new, XML-based swaps reporting system. This relief will only be given to market participants who have made a good faith effort to come into compliance with the new CFTC rule. The “safe harbor” is only temporary, and the Commission believes that industry members will have time to transition into full compliance by March 20, 2012. Any firm relying on this relief must notify the Division via email giving information on how it plans to be fully complaint with large trader reporting rules, including a compliance implementation scheduled.