The Commodity Futures Trading Commission (“CFTC”) Division of Swap Dealer and Intermediary Oversight (“DSIO”) issued a letter dated July 13, 2012 that extends until the end of this year the time during which persons operating or advising commodity pools may continue to rely upon a rescinded exemption and the prior exclusion from registration under the Commodity Exchange Act (“CEA”) that were recently rescinded and modified by the CFTC. This no-action relief applies to operators of both registered investment companies (“RICs”) and private funds and was requested by the Managed Funds Association, the Investment Adviser Association, the Alternative Investment Management Association and the Investment Company Institute.

When the CFTC rescinded this exemption for operators of private funds (and rescinded the related exemption for advisers to private funds) and modified the exclusion relied on by operators of RICs from registration as a commodity pool operator (“CPO”) or commodity trading advisor (“CTA”) (under Regulations 4.5, 4.13(a)(4) and 4.14(a)(8)), it permitted CPOs and CTAs that filed exemption/exclusion notices in accordance with these regulations prior to the effective date of the rescission/modification, April 24, 2012, to continue to operate under the prior exemption/exclusion through December 31, 2012. For commodity pools created on or after April 24, 2012, however, the rescinded exemption and unmodified exclusion could no longer be claimed by operators or advisors thereof. The DSIO no-action relief essentially extends the effective date of the exemption rescission and the modification of the exclusion for pools launched after the issuance of the letter (July 13, 2012) until December 31, 2012. In the same letter, DSIO declined to grant additional time beyond December 31, 2012, by which date swaps must be included in the computation used to determine whether the operators of commodity pools may rely upon the amended standards for exclusion under Regulation 4.5 and the provisions of Regulation 4.13(a)(3) (which was not rescinded as had been proposed).