Executive Summary The CFTC recently amended
its trade option exemption to exclude certain reporting and
recordkeeping requirements if a party to the option is a commercial
end user of the underlying commodity. The broadened exemption
provides relief to such commercial end users by reducing the
compliance burden and costs associated with tracking and reporting
certain transactions.
On March 16, 2016, the U.S. Commodity Futures Trading Commission
("CFTC") unanimously voted to approve a final amendment
(the "Amendment") to the trade option exemption for the
benefit of commercial end users of commodity trade options that are
not swap dealers ("SD") or major swap participants
("MSP") (referred to hereafter as "End Users").
Under the rule prior to the Amendment and CFTC staff no-action
guidance, End Users were exempted from many of the CFTC rules
implementing the Dodd-Frank Act swaps regulatory regime with
respect to such option transactions, so long as the transaction
