The UK Financial Conduct Authority (FCA) and the US Commodity Futures Trading Commission (CFTC) have signed a memorandum of understanding (MoU) concerning cooperation and the exchange of information in the context of supervising ‘covered firms’.
A ‘covered firm’ is defined in the MoU as an entity physically located in either the US or the UK that satisfies the following criteria:
- a swap dealer or major swap participant that is, or that has applied to be, registered as such under the US Commodity Exchange Act; and
- an entity authorised, or that has applied to be authorised, by the FCA in accordance with any of the European single market directives mentioned in Article 2(8) of the European Market Infrastructure Regulation, and in accordance with the UK Financial Services and Markets Act 2000 and the Financial Services and Markets Act 2000 and the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 and that is, or will be, regulated and supervised by the FCA.
The MoU is a statement of intent between the FCA and CFTC to consult, cooperate, and exchange information in connection with the supervision and oversight of covered firms with respect to their ‘covered matters’. The MoU defines ‘covered matters’ as all derivatives-related activities and conduct of a covered firm that are governed by US laws and regulations with respect to the CFTC or UK laws and regulations with respect to the FCA.
View Memorandum of understanding – US CFTC and UK FCA, 27 October 2016