The CFTC unanimously approved amendments to CFTC Rule 4.27 ("Additional Reporting by Commodity Pool Operators and Commodity Trading Advisors") and Form CPO-PQR.
As previously covered, the amendments will:
- (i) refocus data collected from CPOs relating to their operated commodity pools and (ii) update Form CPO-PQR to highlight the most useful data by eliminating schedules B and C, with the exception of the Pool Schedule of Investments ("PSOI");
- integrate data sets by adding questions to allow for the conjunctive use of data collected on Form CPO-PQR and other commodity interest market-related data; and
- allow CPOs to submit NFA Form PQR instead of the revised Form CPO-PQR, but eliminate the ability of CPOs to submit Form PF in lieu of Form CPO-PQR.
Reporting CPOs will be required to file the revised Form CPO-PQR quarterly. The final rule will go into effect 30 days after its publication in the Federal Register.
Additionally, the CFTC signed a Memorandum of Understanding ("MOU") with the Office of Financial Research ("OFR") that establishes a framework for the exchange of information collected on Form CPO-PQR between the CFTC and the OFR.
CFTC Commissioner Statements
Chair Heath P. Tarbert stated that the revisions to Form CPO-PQR were motivated by the principle that the CFTC should only collect information that it has the resources and ability to analyze effectively. Mr. Tarbert pointed out that, while the final rule will reduce data collection requirements, it will also require CPOs and their operated pools to disclose legal entity identifiers ("LEIs"), which will help the CFTC "align the data collected on Form CPO-PQR with the data received from exchanges, clearinghouses, swap data repositories, and futures commission merchants."
Commissioner Brian Quintenz expressed disappointment that the CFTC decided against reverting the PSOI on the revised Form CPO-PQR back to the version of the Schedule of Investments adopted by NFA in 2010 ("2010 Schedule of Investments"), as NFA recommended in its comment letter.
Commissioner Rostin Behnam asserted that the final rule "provides a thoughtfully balanced and complete evaluation of the issues identified in the notice of proposed rulemaking and the responsive comments."
Commissioner Dawn D. Stump, like Commissioner Quintenz, expressed disappointment that the final rule did not revert to the 2010 Schedule of Investments, and voiced support for revisiting the possibility of amending the Schedule of Investments again soon.
Commissioner Dan M. Berkovitz highlighted the LEI disclosure requirement and asserted that the CFTC "should continue working to integrate swaps data with futures data," possibly by "requir[ing] all reporting CPOS and their pools - not just those that trade swaps - to obtain LEIs and submit them on Form CPO-PQR." Additionally, Mr. Berkovitz cautioned that the sharing of nonpublic information with the OFR pursuant to the MOU "must be subject to strict requirements to protect the confidential nature of this data."
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