Notices to Members

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Notice I-06-12

June 5, 2006

4.13 Filing Requirement

In August 2003, the CFTC formally adopted Regulations 4.13(a)(3) and (4), which provide exemptions from CPO registration for persons offering pools with sophisticated participants and limited commodity interest trading, and pools with highly sophisticated participants, respectively. Since the time these exemptions were available, the CFTC required a CPO, claiming a 4.13(a)(3) or (4) exemption for a particular pool, to file a final annual report under Regulation 4.22(c) or 4.7(b)(3) relating to the pool's activities prior to the time that the CPO filed its exemption notice. Recently, however, the CFTC has changed its position regarding this requirement.

Specifically, the CFTC has recently notified NFA that it will no longer require a CPO claiming a 4.13(a)(3) or (4) exemption to file a final annual report with NFA for the pool's activities prior to the time that the CPO filed its exemption notice. This policy is conditioned on the CPO having filed the pool's annual report for the fiscal year preceding the filing of an exemption notice. For example, if a CPO files an exemption notice under 4.13(a)(3) or (4) on June 1, 2006, the 2005 fiscal year annual report would be the pool's last filing with NFA and the CPO is not required to file a 2006 annual report with NFA for the pool's activities prior to June 1, 2006. Current participants in pools claiming one of these exemptions already have been given an opportunity to redeem their interests under Regulation 4.13(e)(2) and to thereafter require a final annual report would only impose additional costs on participants without providing them additional regulatory protections.

Based upon this recent guidance from the CFTC, NFA has updated its records to reflect that a CPO meeting this criterion does not need to file a final annual report for those specific pools. Since this reporting change may affect your filing obligations, NFA encourages each CPO to review NFA's EasyFile system [hyperlink updated 12-01-2021] for a listing of its filing requirements to see whether this change affects your pools and their applicable statement due dates.

Lastly, since a number of 4.7 pools could qualify for an exemption under Regulation 4.13(a)(3) or (4), NFA encourages CPOs to review Regulation 4.13 to determine whether one of these exemptions may be appropriate for your pool. If you have any questions regarding this Notice or annual reports that are due shortly to NFA, please contact NFA as soon as possible at (800) 621-3570.

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