There have been four recent developments with respect to Commodity Futures Trading Commission (“CFTC”) regulatory issues that directly affect fund managers:

• The SEC and CFTC approved final rules defining the terms “swap” and “security-based swap.” Fund managers that have claimed or are considering claiming an exemption from registration as a commodity pool operator (“CPO”) pursuant to Rule 4.13(a)(3), with respect to private investment funds, or Rule 4.5, with respect to funds registered under the Investment Company Act of 1940 (the “De Minimis Exemptions”), will need to use these definitions in determining their eligibility to rely on the De Minimis Exemptions.
• The CFTC issued no-action relief temporarily reinstating, until Dec. 31, 2012, the Rule 4.13(a)(4) exemption from CFTC registration for CPOs that was withdrawn in February 2012. CPOs can claim an exemption from registration pursuant to Rule 4.13(a)(4) even for funds formed after Apr. 24, 2012, which was the effective date of the February withdrawal of the rule.
• In granting this no-action relief, the CFTC specifically rejected a request for an extension of the Dec. 31, 2012 deadline for CPO registration by fund managers that are unable to rely on the De Minimis Exemptions as amended earlier this year by the CFTC.
• The National Futures Association (“NFA”) reminded fund managers of the changes going into effect after Dec. 31, 2012 and also announced the availability of a new option for fund managers to defer the effective date of a new registration to Jan. 1, 2013, the date as of which the Rule 4.13(a)(4) exemption can no longer be relied upon (the “NFA Guidance”).

Click here for more information on final rules defining “swap” and “security-based swap,” the temporary reinstatement of the Rule 4.13(a)(4) exemption from CPO registration and the denial of relief extending effective dates past Dec. 31, 2012.