WASHINGTON (CN) – More organizations that solicit funds from a pool of investors to invest in commodities contracts will have to register with the Commodity Futures Trading Commission, under new rules.
Under the Commodity Exchange Act, the CFTC may register commodity pool operators and commodity trading advisors, and has exempted several types of each from its registration requirements.
The new rules rescind all existing exemptions and set new thresholds for registration based on the value of assets under management and the type of trades the pools execute. Firms may claim relief from the new requirements.
The CFTC also adopted new reporting requirements for pool operators and advisors that conform to the Dodd-Frank Wall Street Reform and Consumer Protect Act.
Under the new rules, pool operators must file reports with the National Futures Association – a self-regulatory organization chartered by the CFTC to oversee the futures trading industry – detailing their exposure to swaps, the extent to which the pool is leveraged and the rules governing the pool’s operations.
The National Futures Association petitioned the CFTC to reconsider the registration requirements because it believed investment companies not traditionally identified as commodity pool operators where marketing commodity pools to retail investors.
Compliance with the new rules is staggered, depending on the size of the pool and the kinds of contracts it holds, but compliance with all parts of the new rules is mandatory by Dec. 31.