The following post comes to us from Sullivan & Cromwell LLP, and is based on a publication by Donald R. Crawshaw, David J. Gilberg, Frederick Wertheim, and Saul P. Sarrett.
On August 13, 2013, the CFTC adopted final rule amendments to accept compliance with the disclosure, reporting and recordkeeping regime administered by the SEC as substituted compliance for substantially all of part 4 of the CFTC’s regulations that are applicable to CPOs of funds registered under the Investment Company Act of 1940. [1] The adopting release broadens the approach set forth in the harmonization proposals issued by the CFTC in February 2012 [2] and provides, among other things, that if the CPO of registered funds satisfies all applicable SEC rules for such funds as well as certain other conditions, it will be deemed in compliance with the CFTC’s rules regarding:
- delivery of disclosure documents to each prospective participant in any pool that a CPO operates (Section 4.21); [3]
- distribution of account statements to each participant in any pool that a CPO operates (Sections 4.22(a) and (b));
- provision of information that must appear in a CPO’s disclosure documents (Section 4.24), including performance disclosures (Section 4.25); and
- the use, amendment and filing of disclosure documents (Section 4.26).
Additionally, the CFTC’s final rule amendments modify certain CFTC disclosure and reporting requirements that are applicable to all CPOs and CTAs: