Apr 26, 2021 | News

Compliance Watch: NFA Commodity Pool Filing Requirements Update

NFA recently adopted Compliance Rule 2-50 with a related Interpretive Notice, CPO Notice Filing Requirements.

Effective June 30, 2021, CPO Members and the pools they operate must notify NFA of any potential financial issues that may impact a CPO’s ability to fulfill its obligations to pool participants or which may result in a pool’s unplanned liquidation.

Below are the criteria for notification:

  • Operates a pool that cannot meet its margin calls
  • Operates a pool that is unable to satisfy redemption requests in accordance with its subscription agreements
  • Operates a pool that has halted redemptions (not related to existing gates or lockups, or a pre-planned cessation of operations)
  • Receives a notice from a swap counterparty that a pool it operates is in default.

The Interpretive Notice further defines the notification events and provides guidance on events that do not trigger the requirement.

Additional instructions from NFA will be forthcoming regarding form and manner of CPO notice filings prior to the effective date.  We will notify you as soon as that information becomes available.  The Compliance Rule can be found by clicking here.

For any compliance questions or assistance, please call Mike Coglianese at 630-461-5841 or email Mike@cogcpa.com.