Extension of no-action position with respect to Part 45 for entities submitting swaps for clearing by derivatives clearing organizations (DCOs) operating consistent with CFTC exemptive orders or no-action positions pr...

Summary: Extension of no-action position with respect to Part 45 for entities submitting swaps for clearing by derivatives clearing organizations (DCOs) operating consistent with CFTC exemptive orders or no-action positions provided by CFTC staff.

1

CFTC Letter No. 25-18 No-Action July 09, 2025

Rahul Varma

Acting Director

Re: Extension of No-Action Position Related to Certain Reporting Obligations for

Counterparties Clearing Swaps through Derivatives Clearing Organizations

Acting Under Exemptive Orders or No-Action Letters

Dear Mr. Young:

This letter responds to a request received by the Division of Market Oversight (“DMO”)

of the Commodity Futures Trading Commission (the “Commission” or “CFTC”) from the

International Swaps and Derivatives Association, Inc. (“ISDA”), pursuant to Commission

Regulation 140.99.1

ISDA has requested, on behalf of its members with swap data reporting obligations and

other similarly situated persons, that DMO renew the no-action position provided in CFTC Letter

No. 22-182 regarding certain reporting obligations under Part 45 of the Commission’s regulations

in connection with the clearing of swaps with derivatives clearing organizations (“DCOs”)

operating pursuant to (a) exemptive orders issued by the Commission,3 or (b) a no-action letter

granted by the Commission’s Division of Clearing and Risk (“DCR”).

1 Letter from Christopher Young, Head of U.S. Public Policy, ISDA, to Rahul Varma, Acting Director, Division of

Market Oversight, re: Request for Extension of CFTC No-Action Relief 22-18: No-Action Relief for SDR Reporting

Requiremnets for Swaps Cleared by Exempt and No-Action DCOs (June 30, 2025) (the “ISDA Letter”), to be available

at https://www.cftc.gov/LawRegulation/CFTCStaffLetters/letters.htm following issuance of this letter.

2 CFTC Letter No. 22-18 (Dec

Rahul Varma, Acting Director, Division of

Market Oversight, re: Request for Extension of CFTC No-Action Relief 22-18: No-Action Relief for SDR Reporting

Requiremnets for Swaps Cleared by Exempt and No-Action DCOs (June 30, 2025) (the “ISDA Letter”), to be available

at https://www.cftc.gov/LawRegulation/CFTCStaffLetters/letters.htm following issuance of this letter.

2 CFTC Letter No. 22-18 (Dec. 2, 2022), available at https://www.cftc.gov/csl/22-18/download, renewed a no-action

position taken in CFTC Letter No. 22-05 (May 25, 2022), available at https://www.cftc.gov/csl/22-05/download.

CFTC Letter 22-05 renewed a no action position extended in CFTC Letter No. 21-12 (Apr. 28, 2021), available at

https://www.cftc.gov/csl/21-12/download,

CFTC

Letter

No.

18-03

(Feb.

20,

2018),

available

at

https://www.cftc.gov/csl/18-03/download, and CFTC Letter No. 16-85 (Dec. 19, 2016), available at

http://www.cftc.gov/idc/groups/public/@lrlettergeneral/documents/letter/16-85.pdf.

3 The Commission adopted regulations for exempt DCOs in 2021. See Exemption From Derivatives Clearing

Organization Registration, 86 Fed. Reg. 949 (Jan. 7, 2021).

U.S. COMMODITY FUTURES TRADING COMMISSION

Three Lafayette Centre

1155 21st Street, NW, Washington, DC 20581

Telephone: (202) 418-5000

Division of

Market Oversight

2

I.

Definitions for No-Action Position

Exclusively for the purposes of this letter, DMO will define the following terms:

(a) Relief DCO: Any DCO or central counterparty acting pursuant to a current and valid

exemptive order issued by the Commission (“Exempt DCO”), or a current and valid no-

action letter issued by DCR (“No-Action DCO”). As of the date of this letter, there are

five DCOs acting pursuant to exemptive orders: ASX Clear (Futures) Pty Limited, Japan

Securities Clearing Corporation, Korea Exchange, Inc., OTC Clearing Hong Kong

Limited, and Taiwan Futures Exchange Corporation.

valid

exemptive order issued by the Commission (“Exempt DCO”), or a current and valid no-

action letter issued by DCR (“No-Action DCO”). As of the date of this letter, there are

five DCOs acting pursuant to exemptive orders: ASX Clear (Futures) Pty Limited, Japan

Securities Clearing Corporation, Korea Exchange, Inc., OTC Clearing Hong Kong

Limited, and Taiwan Futures Exchange Corporation.

(b) Relief DCO Counterparty: Any market participant, not acting as a DCO or central

counterparty, that is a counterparty to a swap cleared by a Relief DCO.

(c) Relief DCO Original Swap: A swap reported or required to be reported pursuant to Part 45

of the Commission’s regulations that is subsequently accepted for clearing by a Relief

DCO.

(d) Relief DCO Clearing Swap: Any swaps created pursuant to the rules of a Relief DCO

between a Relief DCO and Relief DCO Counterparty.

(e) Relief Intended To Be Cleared Swap (“ITBC Swap”): Any swap which, at the time it is

executed, is intended by the counterparties to be cleared by a Relief DCO.

II.

Background

A. Certain Reporting Obligations

On June 27, 2016, the Commission published its final rule on Amendments to Swap Data

Recordkeeping and Reporting Requirements for Cleared Swaps (the “Cleared Swap Rule”).4 The

Cleared Swap Rule amended Part 45 of the Commission’s regulations5 to clarify or address certain

reporting obligations, including the obligations for DCOs to (a) report the termination of swaps

accepted for clearing by the DCO (defined as “original swaps” and known in the industry as “alpha

swaps”);6 (b) report creation data and continuation data for swaps to which the DCO is a

counterparty (defined as “clearing swaps”)7; and (c) generate the unique swap identifier (“USI”)

for each clearing swap and transmit that USI to the DCO’s counterparty.8

4 81 Fed. Reg. 41736 (June 27, 2016). The compliance date for the Cleared Swap Rule was December 27, 2016.

5 17 CFR part 45.

6 17 CFR § 45.4(c) (2016)

t creation data and continuation data for swaps to which the DCO is a

counterparty (defined as “clearing swaps”)7; and (c) generate the unique swap identifier (“USI”)

for each clearing swap and transmit that USI to the DCO’s counterparty.8

4 81 Fed. Reg. 41736 (June 27, 2016). The compliance date for the Cleared Swap Rule was December 27, 2016.

5 17 CFR part 45.

6 17 CFR § 45.4(c) (2016).

7 17 CFR § 45.3(e) (2016) (creation data for clearing swaps); 17 CFR 45.4(b) (2016) (continuation data for clearing

swaps).

8 17 CFR § 45.5(d) (2016). The Commision subsequently amended regulation 45.5 to require creation of unique

transaction identifiers (“UTIs”). See 17 C.F.R. § 45.5 (2025); see also Swap Data Recordkeeping and Reporting

Requirements, 85 Fed. Reg. 75503 (Nov. 25, 2020).

3

The Cleared Swap Rule defined “derivatives clearing organization” exclusively as a DCO

registered with the Commission.9 Because a Relief DCO would not be a “derivatives clearing

organization” for purposes of the Cleared Swap Rule, a swap accepted for clearing by a Relief

DCO would not be an “original swap” under § 45.4 of the Commission’s regulations.10 Therefore,

the obligation to terminate the Relief DCO Original Swap does not fall to the Relief DCO. Further,

Relief DCO Clearing Swaps are not considered “clearing swaps.” As a result, reporting

obligations for Relief DCO Clearing Swaps fell to the Relief DCO Counterparty (either a swap

dealer (“SD”), major swap participant (“MSP”), or non-SD/MSP counterparty) by operation of the

reporting hierarchy under § 45.8.11

Although not subject to reporting obligations imposed on registered DCOs under the

Cleared Swap Rule, Relief DCOs are required to fulfill many of the same obligations pursuant to

both § 39.6(d)12 and as a term of an exemptive order or as condition to no-action letters

r (“SD”), major swap participant (“MSP”), or non-SD/MSP counterparty) by operation of the

reporting hierarchy under § 45.8.11

Although not subject to reporting obligations imposed on registered DCOs under the

Cleared Swap Rule, Relief DCOs are required to fulfill many of the same obligations pursuant to

both § 39.6(d)12 and as a term of an exemptive order or as condition to no-action letters. As noted

above, there are currently five DCOs acting under exemptive orders issued by the Commission.13

Each of the exemptive orders includes the following requirement:

(10) Swap Data Recordkeeping and Reporting Requirements. If a clearing member clears

through [Relief DCO] a swap that has been reported to a Commission-registered swap data

repository (“SDR”) pursuant to Part 45 of the Commission's regulations, then [Relief DCO]

must report to an SDR, pursuant to this Order, data regarding the two swaps resulting from

the novation of the original swap that had been submitted to [Relief DCO] for clearing.

[Relief DCO] must also report the termination of the swap accepted for clearing by [Relief

DCO], to the SDR to which the swap was originally reported. In order to avoid duplicative

reporting for such transactions, [Relief DCO] shall have rules that prohibit the Part 45

reporting of the two new swaps by the original counterparties to the original swap.14

Although the exemptive orders have placed, and any Relief DCO no-action letter would

place, certain reporting obligations on the Relief DCOs, the exemptive orders do not, and a Relief

DCO no-action letter would not, provide any no-action position to the Relief DCO Counterparty

for any reporting obligations.

B. Certain Reporting Data Fields in Part 45

The Cleared Swap Rule’s definition of “derivatives clearing organization” implicates

certain data elements historically required to be reported for Relief ITBC Swaps

e Relief DCOs, the exemptive orders do not, and a Relief

DCO no-action letter would not, provide any no-action position to the Relief DCO Counterparty

for any reporting obligations.

B. Certain Reporting Data Fields in Part 45

The Cleared Swap Rule’s definition of “derivatives clearing organization” implicates

certain data elements historically required to be reported for Relief ITBC Swaps. Specifically, at

9 17 CFR § 45.1 (definition of “derivatives clearing organization”); Cleared Swap Rule, 81 FR at 41739 (declining to

extend the definition of “derivatives clearing organization” to include exempt DCOs). Although the Commission

recently amended certain Part 45 regulations, Swap Data Recordkeeping and Reporting Requirements, 85 Fed. Reg.

75503 (Nov. 25, 2020), the definition of “derivatives clearing organization” remains a DCO registered with the

Commission. Therefore, Relief DCO counterparties would still likely seek the no-action position described below

from their reporting obligations.

10 17 CFR § 45.4.

11 17 CFR § 45.8.

12 17 CFR § 39.6(d).

13 ASX Clear (Futures) Pty Limited, Japan Securities Clearing Corporation, Korea Exchange, Inc., OTC Clearing

Hong Kong Limited, and Taiwan Futures Exchange Corporation.

14 See, e.g., http://www.cftc.gov/idc/groups/public/@otherif/documents/ifdocs/asxclearamdorderdcoexemption.pdf

(ASX exemptive order). Any Relief NAL would include similar language.

4.

11 17 CFR § 45.8.

12 17 CFR § 39.6(d).

13 ASX Clear (Futures) Pty Limited, Japan Securities Clearing Corporation, Korea Exchange, Inc., OTC Clearing

Hong Kong Limited, and Taiwan Futures Exchange Corporation.

14 See, e.g., http://www.cftc.gov/idc/groups/public/@otherif/documents/ifdocs/asxclearamdorderdcoexemption.pdf

(ASX exemptive order). Any Relief NAL would include similar language.

4

the time the Cleared Swap Rule was promulgated in 2016, Part 45 required certain primary

economic terms data (“PET data”) be reported for each swap, including “Clearing indicator” data

and “Clearing venue” data, which referenced DCOs.15 Because Relief DCOs would not be

“derivatives clearing organizations” for purposes of those data fields, absent a no-action position,

the Cleared Swap Rule would require any entity reporting a Relief ITBC Swap to indicate that

such swap was not intended to be cleared.

On November 25, 2020, the Commission published amendments to Part 45.16 As part of

these amendments, the Commission replaced the old concept of PET data with new appendices

specifying the data elements to be reported.17 Staff has published updated technical specifications

that provide the form and manner for reporting those data elements to SDRs.18 Whereas Part 45

PET data incorporated the Cleared Swap Rule’s definition of “derivatives clearing organization”

for purposes of identifying swaps that were intended to be cleared, the newer technical

specifications instead use the term “central counterparty,” which is defined to include both a

“derivatives clearing organization” and an “exempt derivatives clearing organization.”19 The

current version of the technical specifications do not, however, explicitly state that the term

“central counterparty” also includes central counterparties acting pursuant to Relief DCO NALs.

III.

Requested No-Action Position With Respect To Certain Reporting Obligations

Under Part 45

ISDA requests the renewal of the no-action position in CFTC Letter No

es clearing organization.”19 The

current version of the technical specifications do not, however, explicitly state that the term

“central counterparty” also includes central counterparties acting pursuant to Relief DCO NALs.

III.

Requested No-Action Position With Respect To Certain Reporting Obligations

Under Part 45

ISDA requests the renewal of the no-action position in CFTC Letter No. 22-18 regarding

reporting obligations for counterparties facing Relief DCOs. Specifically, ISDA’s request covered

the following reporting obligations of counterparties that are neither DCOs nor central

counterparties:

1. Reporting swap continuation data for alpha swaps that have been accepted for clearing by

a Relief DCO;20

2. Reporting any creation data and continuation data for swaps resulting from novation of an

alpha swap accepted for clearing by a Relief DCO, as well as any related swaps which may

be entered into as part of post-trade activities including netting or compression exercises

or novations; and

15 See Swap Data Recordkeeping and Reporting Requirements, 77 Fed. Reg. 2136 (Jan. 13, 2012), App’x 1.

16 See Swap Data Recordkeeping and Reporting Requirements, 85 Fed. Reg. 75503 (Nov. 25, 2020). The compliance

date for regulations subject to those amendments was May 25, 2022. On January 31, 2022, the Division of Data issued

CFTC Letter No. 22-03, stating that the Division of Data would not recommend that the Commission take an

enforcement action against an entity for failure to comply with the regulations amending Part 45 before December 5,

2022. See CFTC Letter No. 22-03 (Jan. 31, 2022), available at https://www.cftc.gov/csl/22-03/download.

Accordingly, market participants implemented swap data reporting in the form and manner provided in the technical

specifications on December 5, 2022.

17 See id. at 75507.

18 See, e.g., Parts 43 and 45 swap data reporting and public dissemination requirements, Version 3.2 (Mar

re December 5,

2022. See CFTC Letter No. 22-03 (Jan. 31, 2022), available at https://www.cftc.gov/csl/22-03/download.

Accordingly, market participants implemented swap data reporting in the form and manner provided in the technical

specifications on December 5, 2022.

17 See id. at 75507.

18 See, e.g., Parts 43 and 45 swap data reporting and public dissemination requirements, Version 3.2 (Mar. 1, 2023),

available at https://www.cftc.gov/media/8261/Part43_45TechnicalSpecification03012023CLEAN/download.

19 See id. at 1 n.14.

20 ISDA requested a no-action position relating to ITBC Swaps with central counterparties exempted by the

Commission and central counterparties that received no-action letters from DCR. DMO has combined these two types

of central counterparties as “Relief DCOs” for purposes of this letter.

5

3. Generating Unique Transaction Identifiers (“UTIs”) for swaps created through the process

of clearing a swap with a Relief DCO.

ISDA requested that the no-action position remain in effect until the earlier of (a) the

revocation or expiration of the exemptive order or no-action letter issued to the relevant Relief

DCO, or (b) until further Commission action renders the no-action position inapplicable.

IV.

No-Action Position

Based on the facts presented and the representations that ISDA has made, DMO will not

recommend enforcement action to the Commission against Relief DCO Counterparties, solely for

failure to comply with the following reporting obligations:

a. Reporting continuation data pursuant to regulation § 45.4 on Relief DCO Original

Swaps after the acceptance of such Relief DCO Original Swaps for clearing by the

Relief DCO, including reporting the termination of the Relief DCO Original Swap;

b. Reporting creation data pursuant to regulation § 45.3 and continuation data pursuant to

regulation 45.4 on Relief DCO Clearing Swaps; and

c. Generating UTIs for Relief DCO Clearing Swaps pursuant to regulation § 45.5

DCO Original

Swaps after the acceptance of such Relief DCO Original Swaps for clearing by the

Relief DCO, including reporting the termination of the Relief DCO Original Swap;

b. Reporting creation data pursuant to regulation § 45.3 and continuation data pursuant to

regulation 45.4 on Relief DCO Clearing Swaps; and

c. Generating UTIs for Relief DCO Clearing Swaps pursuant to regulation § 45.5.

This no-action position is subject to the condition that the Relief DCO Counterparty must

provide to the Relief DCO all information on the Relief DCO Original Swap required by the Relief

DCO in its clearing agreement.

For Relief DCO Original Swaps and Relief DCO Clearing Swaps, the no-action position

taken herein will continue until the earlier of: (a) the revocation or expiration of the exemptive

order or no-action letter issued to the relevant Relief DCO; or (b) Commission action that renders

the no-action position inapplicable. Relief DCO Counterparties retain all other reporting

obligations for which they are responsible under the Commission’s regulations, and the no action

position herein does not apply if the Relief DCO rejects the swap for clearing.

In the ISDA Letter, ISDA requests clarification that reporting counterparties should report

a value of “Yes” in the cleared field for swaps intended to be submitted for clearing to a No-Action

DCO and report the LEI of the No-Action DCO in the central counterparty field for swaps intended

to be cleared at a No-Action DCO. Staff notes that under the no-action position taken here, Relief

DCO Original Swaps and Relief DCO Clearing Swaps are treated as original swaps and cleared

swaps for purposes of the Part 45 reporting requirements. Accordingly, it would be consistent

with the no-action position herein to treat the swaps cleared by a Relief DCO as cleared by a central

counterparty for purposes of the technical specifications

at under the no-action position taken here, Relief

DCO Original Swaps and Relief DCO Clearing Swaps are treated as original swaps and cleared

swaps for purposes of the Part 45 reporting requirements. Accordingly, it would be consistent

with the no-action position herein to treat the swaps cleared by a Relief DCO as cleared by a central

counterparty for purposes of the technical specifications.

*

*

*

This letter, and the no-action position taken herein, represent the views of the Division

only, and do not necessarily represent the position or views of the Commission or of any other

division or office of the Commission’s staff. This letter and the no-action position taken herein

6

are not binding on the Commission or other Commission staff.21 The no-action position taken

herein does not excuse affected persons from compliance with any other applicable requirements

contained in the Commodity Exchange Act or the regulations thereunder (in particular, the

applicable swap reporting requirements and clearing requirements). 22 Further, this letter, and the

position taken herein, are based upon the facts and circumstances presented to Division staff. Any

different, changed, or omitted material facts or circumstances might render this letter void. Finally,

as with all no-action letters, the Division retains the authority to condition further, modify,

suspend, terminate or otherwise restrict the terms of the no-action position provided herein, in its

discretion.

If you have any questions concerning this correspondence, please contact Isabella

Bergstein, Division of Market Oversight, at (202) 993-1384 or ibergstein@cftc.gov, Paul Chaffin,

Division of Market Oversight, at (202) 418-5185 or pchaffin@cftc.gov, or Owen Kopon, Division

of Market Oversight, at (202) 418-5360 or okopon@cftc.gov

of the no-action position provided herein, in its

discretion.

If you have any questions concerning this correspondence, please contact Isabella

Bergstein, Division of Market Oversight, at (202) 993-1384 or ibergstein@cftc.gov, Paul Chaffin,

Division of Market Oversight, at (202) 418-5185 or pchaffin@cftc.gov, or Owen Kopon, Division

of Market Oversight, at (202) 418-5360 or okopon@cftc.gov.

Sincerely,

_________________________

Rahul Varma

Acting Director

Division of Market Oversight

21 See 17 CFR § 140.99(a)(2) (“A no-action letter binds only the issuing Division . . . and not the Commission or other

Commission staff.”).

22 The applicable swap reporting requirements are set forth under Parts 43, 45, 46, and 50 of the Commission’s

regulations, 17 CFR parts 43, 45, 46 and 50, respectively. The applicable clearing requirements are set forth under

Commodity Exchange Act section 2(h)(1), 7 U.S.C. § 2(h)(1), and Part 50 of the Commission’s regulations.