In a recent change to the NFA's registration database (BASIC), non-member exemption filers, such as "exempt" CPOs and CTAs, are no longer displayed.
The process for making such exemption filings, and the publicly available information about registered NFA member entities, remains unchanged.
Why it matters
Under NFA Bylaw 1101, NFA member managers are required to confirm the CFTC registration status of counterparties engaged in commodity interest-related activities, such as executing brokers, third-party subadvisors or entity investors in a commodity pool. This review is to be performed at the commencement of a new business relationship and annually thereafter.
Historically, NFA member firms were able to reference the publicly available BASIC database to verify whether a counterparty claiming to be exempt from CFTC registration maintained a valid exemption. This avenue is no longer available.
Instead, NFA member managers should now log into the NFA Member Questionnaire System and access a link to a spreadsheet of affirmed exemptions to confirm the status of non-member entities that have made registration exemption filings.
The updates to BASIC bring no changes to the information available about registered NFA members, including those who have may have filed exemptions at the pool level.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
