CFTC Staff Withdraws Advisory On Swap Execution Facility Registration Requirement

On March 13, 2025, the Commodities Futures Trading Commission ("CFTC") issued Letter 25-05, withdrawing controversial and much-criticized Staff Letter 21-19 ("SEF Registration Advisory"), which was issued September 29, 2021 by the CFTC's Division of Market Oversight ("DMO"). The original staff letter reminded market participants of the swap execution facility ("SEF") registration requirements under the Commodity Exchange Act ("CEA") and the CFTC regulations.

The letter's broad SEF registration requirements caused uncertainty, introducing a fact-specific approach to SEF registration and proposing far-reaching scenarios in which registration might be required beyond what market participants had understood since the enactment of CFTC's SEF rules almost a decade prior, in 2013.