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ARTICLE · 21 APRIL 2025

CFTC Clarifies That FX Window Forwards Are Not "Swaps"

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On April 9, 2025, the Markets Participants Division and the Division of Market Oversight (collectively, the "Divisions") of the Commodity Futures Trading Commission (the "CFTC")...

United StatesFinance and Banking
Elanit Snow
Elanit Snow
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On April 9, 2025, the Markets Participants Division and the Division of Market Oversight (collectively, the "Divisions") of the Commodity Futures Trading Commission (the "CFTC") published a Staff Letter (the "Staff Letter") clarifying the Divisions' views on the regulatory treatment of certain foreign exchange products. The Divisions clarified that certain foreign exchange window forwards ("Window FX Forwards") should be considered "foreign exchange forwards" under the CFTC's regulations and, as a result, exempt from most CFTC regulations relating to swaps. The Divisions also clarified that package foreign exchange spot transactions that settle within T+2 are to be treated as "spot" transactions and outside the scope of most of the CFTC's swap regulations.

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