Introduction On December 1, 2015, the National Futures Association (the NFA) issued a notice to members to remind them of certain Commodity Futures Trading Commission (CFTC) regulations that require any person claiming an exemption or exclusion under CFTC Regulation §4.5, §4.13(a)(1), §4.13(a)(2), §4.13(a)(3), §4.13(a)(5) or §4.14(a)(8) from the requirement to register as a commodity pool operator (CPO) or commodity trading advisor (CTA) to annually affirm their notice of exemption or exclusion within 60 days of the calendar year end, which is February 29, 2016 for the current affirmation cycle.
The guidance states that failure by a member to affirm such active exemption or exclusion from CPO or CTA registration by February 29, 2016 will result in the automatic withdrawal of such member’s exemption or exclusion on March 1, 2016. Accordingly, by failing to reaffirm in time, a person that would otherwise be exempt or excluded from registration will be subject to the regulations applicable to CPOs or CTAs (regardless of whether the entity remains eligible for the exemption or exclusion) and to possible CFTC enforcement action for non-compliance.
Below, we (1) briefly discuss the procedural matters for making the annual NFA affirmations, (2) provide a more detailed discussion of compliance maters for CPOs and CTAs, and, (3) in conclusion, provide a brief summary of EU regulations applicable to funds and fund advisors.
Read the full Alert by downloading the .PDF below.