Reed Smith Client Alerts

On May 23, 2017, the U.S. Commodity Futures Trading Commission unanimously approved a revamped CFTC Rule 1.31, which specifies the form and manner that records must be kept by commodities market participants, and a slight modification to CFTC Rule 23.203, which pertains to swaps record retention. This modernized edition of Rule 1.31 aims to simplify and streamline the CFTC’s recordkeeping procedures and goes into effect on August 28, 2017. Because Rule 1.31 specifies the form and manner for keeping all CFTC-required records, the effects of this rulemaking will be significant.

Authors: Peter Y. Malyshev

Modernizing the Commodity Futures Trading Commission’s (“CFTC”) regulations for the “Digital Age” and replacing overly prescriptive rules with clear principles are two stated aims of Acting Chairman J. Christopher Giancarlo. On May 23, 2017, the Acting Chairman made progress on both of these fronts with the unanimous approval of a revamped CFTC Rule 1.31 (“Amended Rule 1.31”), which specifies the form and manner that records must be kept by commodities market participants, and a slight modification to CFTC Rule 23.203, which pertains to swaps record retention.1 This modernized edition of Rule 1.31 does not impose any new obligations on persons currently in compliance with the CFTC’s recordkeeping requirements, but it aims to simplify and streamline their recordkeeping procedures when it goes into effect August 28, 2017, which will be greatly welcomed by industry. Because Rule 1.31 specifies the form and manner for keeping all CFTC-required records, the effects of this rulemaking will be significant.