On Oct. 9, 2018, in a wide-ranging notice of proposed rulemaking (the “KISS Proposal”), the Commodity Futures Trading Commission proposed (1) to codify several accepted practices that currently rely on no-action letters and similar CFTC staff guidance and (2) to make a number of substantive changes to CFTC regulations, such as offering broader exemptive relief for offshore funds and imposing disqualifications from certain commonly claimed exemptions.

The proposals are now in a comment period, so investment managers that (1) are CFTC registrants, (2) are claiming one or more exemptions from CFTC registration or (3) operate funds that are claiming one or more exemptions under the CFTC’s regulations should review the proposals to determine what, if any, changes the KISS Proposal would have on their businesses. Some managers may deem it useful to submit comment letters to the CFTC explaining what the effect of these regulations, if adopted, would be on their businesses.

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