GFMA and FSR Submit Comments to the CFTC Requesting No-Action Relief Compliance with Documentation Requirements for Deliverable FX Swaps and FX Forwards
5 June 2013
GFMA and The Financial Services Roundtable (FSR) provide comments to the Commodity Futures Trading Commission (CFTC) requesting time-limited relief for swap dealers to comply with CFTC Regulation 23.504 (STRD Rule) in connection with deliverable foreign exchange (FX) swaps and foreign exchange forwards.
While the current FX industry best practice is to document transactions with their counterparties in Exempt FX Products, it is not universal for the reasons described in this letter. Because of the significant number of institutions that trade Exempt FX Products that are not covered by Compliant Documentation, the lack of awareness that the STRD Rule applied to Exempt FX Products, and the lengthy negotiations necessary to enter into new documentation (because such documentation does not exist, or to amend existing documentation to bring Exempt FX Products within scope), many institutions will be unable to satisfy the STRD Rule by July 1, 2013.