The NFA reminded members of the annual affirmation obligations for certain exempt or excluded commodity pool operators ("CPOs") / commodity trading advisors ("CTAs").
In its Notice, the NFA stated that the CFTC requires any person that claims an exemption from CPO registration under CFTC Rule 4.13(a)(1), 4.13(a)(2), 4.13(a)(3) or 4.13(a)(5), an exclusion from CPO registration under CFTC Rule 4.5, or an exemption from CTA registration under CFTC Rule 4.14(a)(8) to annually affirm the applicable notice of exemption within 60 days of the calendar year end. A failure to file the affirmation notice by March 1, 2019 will be treated as the equivalent of a request to withdraw the relevant exemption. The NFA stated that it is critical to comply with the annual affirmation process, as registration may be required otherwise.
The NFA urged members to take "reasonable steps to determine the registration and membership status of these previously exempt persons." If they do so, members "will not be in violation of NFA Bylaw 1101 or Compliance Rule 2-36(d) if, between January 1 and March 31, 2019, they transact customer business with a previously exempt person that fails to become registered and an NFA Member, file a notice affirming its exemption from CPO/CTA registration, or provide a written representation as to why the person is not required to register or file the notice affirming the exemption." Further, the NFA outlined certain steps that members can take "to identify whether an exempt CPO/CTA has affirmed its exemption" and described the "expectations for members transacting customer business with an exempt CPO/CTA that has not affirmed its exemption."
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