The Division of Clearing and Risk of the Commodity Futures Trading Commission recently issued no-action relief for certain treasury affiliates within non-financial companies from the clearing requirements of Section 2(h)(1) of the Commodity Exchange Act. In CFTC Letter No. 13-22, the Division indicated that it was issuing the relief in response to a number of comments received from non-financial companies with wholly-owned treasury affiliates that hedge risks for the entire non-financial company group. Absent the no-action relief, many such entities would have been required to clear swaps subject to the CEA starting on June 10, 2013. Counterparties electing the relief provided under the No Action Letter will now be required to comply with the reporting requirements described below as of September 9, 2013.
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