CFTC Adopts Significant Changes To CPO And CTA Registration And Compliance Requirements

Introduction

On February 9, the Commodity Futures Trading Commission adopted by a vote of 4 to 1 (Commissioner Sommers dissenting) final rules amending its Part 4 regulations governing commodity pool operators (CPOs) and commodity trading advisors (CTAs). As discussed at further length below, the amendments:

• Rescind the exemption from CPO registration under CFTC Rule 4.13(a)(4) for CPOs of commodity pools offered solely to certain qualified eligible persons and institutional investors;
• Adopt additional reporting obligations for registered CPOs and CTAs and new Forms CPO-PQR and CTA-PR under CFTC Rule 4.27;
• Require the provision of certified, audited annual financial statements by registered CPOs relying upon the reporting relief provided under CFTC Rule 4.7;