United States

Topic: Energy

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Impact of partial US government shutdown on federal financial regulatory agencies

As a result of the United States Congress not adopting an appropriations bill or a continuing resolution to fund specific government departments, agencies or functions, certain federal agencies are currently subject to a partial government shutdown. Below is an overview of how the partial federal government shutdown is affecting financial or other major regulatory agencies: … Continue Reading

December 7 Norton Rose Fulbright New York briefing to focus on FERC regulatory and enforcement trends

Norton Rose Fulbright New York office’s next financial services briefing is a luncheon seminar set for Thursday, December 7, 2017, at 12:00-1:00 PM ET. Each month, Norton Rose Fulbright’s senior practitioners will provide interested in-house counsel and professionals with an insightful discussion on current regulatory trends within the financial services sector. The December briefing will … Continue Reading

D.C. Circuit Vacates Revisions to PJM Minimum Offer Price Rule: Finds FERC Exceeded Statutory Authority

In a decision issued on July 7, 2017, the U.S. Court of Appeals for the D.C. Circuit vacated revisions to the PJM Interconnection, L.L.C. (“PJM”) Minimum Offer Price Rule (“MOPR”) that had been proposed by the Federal Energy Regulatory Commission (“FERC”) in response to a filing submitted by PJM pursuant to section 205 of the … Continue Reading

CFTC amends regulations to prohibit restrictions on employee communication concerning potential Commodity Exchange Act violations

On May 22, 2017, the Commodity Futures Trading Commission (“CFTC”) amended Part 165 of its regulations, which govern whistleblower incentives and protections. In addition to strengthening existing anti-retaliation protections for whistleblowers, the amendments also prohibit employers from restricting employees from reporting potential violations of the Commodity Exchange Act directly to the CFTC. This prohibition extends … Continue Reading

CFTC pushes position limits to new Administration, but finalizes aggregation rules

Today, in a move on its long-pending proposals, the CFTC: (1) re-proposed its new speculative position limits rules (the “Re-Proposal”), which would impose federal limits on 25 physical commodity futures contracts and their “economically equivalent” futures, options, and swaps; and (2) separately issued final rules relating to position aggregation requirements (the “Final Aggregation Rules”). We … Continue Reading

CFTC Chairman Massad supports one-year extension of current swap dealer de minimis threshold

CFTC Chairman Massad today announced that he will recommend a one-year extension of the date on which the swap dealer de minimis threshold will drop from $8 billion to $3 billion.  Chairman Massad will recommend the Commission take this action through Commission order.  If adopted, the Commission order would permit market participants to calculate their … Continue Reading

CFTC proposes enhanced Exchange authority over exemptions to proposed position limits

The CFTC has issued a supplemental proposed rulemaking (the “2016 Supplement”) that would give futures exchanges (“Exchanges”) greater authority over exemptions if the CFTC finalizes its long-pending proposed new speculative position limits that it published in December 2013 (the “Limits Proposal”).  In an effort to be responsive to severe criticism of the Limits Proposal, particularly … Continue Reading

CFTC proposes to clear way for private rights of action concerning exempted RTO/ISO transactions

On May 10, 2016, the U.S. Commodity Futures Trading Commission (“CFTC”) issued a notice of proposed amendment to its 2013 order exempting specified electric energy transactions in certain Regional Transmission Organizations (“RTOs”), Independent System Operators (“ISOs”) and the Electric Reliability Council of Texas (“ERCOT”) from regulation under certain provisions of the Commodity Exchange Act (“CEA”) … Continue Reading

CFTC retires Form TO – and most other requirements for end-users regarding trade options

The CFTC recently issued Final Rules eliminating the requirement that commercial end-users of derivatives file an annual Form TO for reporting certain information about their use of commodity trade options. The agency confirmed that, in light of the Final Rules, the Form TO that was due by April 1, 2016, with respect to trade option … Continue Reading

ICE Futures US adopts new position limit disaggregation rule for owned entities

ICE Futures US (“ICE”) adopted a new rule, effective March 18, 2016, that provides relief from position limit aggregation requirements applicable to “owned entities.” Specifically, the rule amendment permits certain affiliated entities to disaggregate their positions for purposes of compliance with ICE’s position limits. Background ICE imposes spot-month position limits on all its futures contracts, … Continue Reading

CFTC and futures exchange enforcement actions: A year in review (2015)

Market participants must be mindful of the robust enforcement environment at the CFTC and U.S. futures exchanges.  In 2015, the CFTC brought numerous enforcement actions and continued to impose aggressive civil monetary penalties on market participants, including energy and agricultural companies.  Significantly, the CFTC also started to pivot from implementing to enforcing its regulations promulgated … Continue Reading

FERC clarifies buy/sell prohibition exemption for AMAs

On October 15, 2015, the Federal Energy Regulatory Commission issued an order clarifying that the exemption from the buy/sell prohibition applies to supply side natural gas asset management agreements. This clarification is important for both holders of interstate capacity and asset managers and should provide more flexibility for parties to structure their transactions.  Norton Rose … Continue Reading

CFTC issues new position limits proposal to make it easier for majority-owned affiliates (greater than 50% to 100% ownership) to disaggregate futures and swaps positions

On September 22, 2015, the CFTC issued a “supplemental” proposed rulemaking (the “2015 Proposal”) to revise its long-pending proposal on aggregation for position limit purposes published in November 2013 (the “2013 Proposal”). The 2015 Proposal, if finalized, would provide companies with over 50% ownership or equity interest in affiliated entities with an easier mechanism to … Continue Reading

EPA Clean Power Plan will bring changes for the US power sector

On August 3, 2015, the U.S. Environmental Protection Agency (“EPA”) issued its final Clean Power Plan, which announces new standards and emission guidelines to reduce carbon pollution from power plants. The plan takes into account input received through EPA outreach to the power industry and its regulators, as well as from the over four million comments … Continue Reading

CFTC finalizes revised interpretation on forwards with embedded volumetric options

On May 18, 2015, the CFTC published in the Federal Register its final revised 7-part Interpretation regarding “forward contracts with embedded volumetric optionality.” The final guidance provides useful clarification in determining when a contract with an embedded volumetric option qualifies for the forward contract exclusion from the “swap” and “future delivery” definitions under the Commodity … Continue Reading

The demise of CFTC Form TO for commodity trade options

On May 7, 2015, the CFTC published in the Federal Register a proposal to eliminate the odd-yet-burdensome Form TO, which for the past two years has been required of derivatives end-users to report certain information to the CFTC regarding their trading in commodity trade options. If the proposal is adopted as final after the close … Continue Reading

3 Thoughts on the ODRG Report to the G20 in advance of the G20 Leaders’ Summit

On November 7, 2014, the Over-the-Counter (OTC) Derivatives Regulators Group (ODRG), consisting of derivatives market regulators (referred to as “Principals”) from Australia, Brazil, the European Union, Hong Kong, Japan, Ontario, Quebec, Singapore, Switzerland, and the United States (CFTC and SEC) issued a report updating the G20 Leaders on certain cross-border issues associated with the G20’s … Continue Reading

CFTC proposes revised test for embedded volume options

On November 3, 2014, the CFTC approved a proposal to revise the often confusing “seven-part” test for forward contracts with embedded volume options that the CFTC announced in its final product definition rules (77 Fed. Reg. 48,208). The CFTC offered the seven-part test as a clarification to help commercial market participants distinguish routine physical forward … Continue Reading

CFTC proposes to “fine-tune” rules to protect commercial end users

On November 3, the CFTC proposed what new Chairman Timothy Massad described as “further fine-tuning of our rules” to avoid “unintended consequences on . . . nonfinancial commercial companies . . .  .”  This post addresses the CFTC’s proposals regarding: 1)     recordkeeping requirements; and 2)     the deadline for posting “residual interest.” Recordkeeping requirements The CFTC … Continue Reading

A break with the past: Treatment of precedent in the CFTC’s position limits re-proposal

The CFTC’s pending re-proposed speculative position limits and position aggregation rulemakings (the “Re-Proposal”), like its previous rules that were vacated by a federal district court, represent a radical departure from the CFTC’s past position limits precedents in several respects.  In some instances, the Re-Proposal acknowledges this change in course and attributes it to the mandates … Continue Reading

3 Thoughts On global regulators’ update to G20 On derivatives cross-border implementation

On September 10, 2014 the Over-the-Counter (OTC) Derivatives Regulators Group (ODRG), consisting of derivatives market regulators from Australia, Brazil, the European Union, Hong Kong, Japan, Ontario, Quebec, Singapore, Switzerland, and the United States (CFTC and SEC) released a report to the G20 that provided an update on the resolution of key cross-border derivatives reform implementation issues. … Continue Reading

CFTC to vote on proposed swap margin rule and final rule on swaps with utility special entities

On September 17, the Commodity Futures Trading Commission (CFTC) will hold its first open meeting under new Chairman Timothy Massad to vote on:  1) a re-proposed rule on margin requirements for uncleared swaps for swap dealers; and 2) a final rule excluding certain swaps with utility special entities from the de minimis calculation for swap … Continue Reading

Commercial market participants may get a reprieve on trade options in CFTC reauthorization

The U.S. House of Representatives has passed H.R. 4413, a bill that would reauthorize the Commodity Futures Trading Commission (CFTC) and also make some important changes to the Commodity Exchange Act (CEA), including changing the definition of the term “swap” in a way that would benefit certain physical market participants. H.R. 4413, which currently is … Continue Reading

Market participants weigh in regarding CFTC’s re-proposed position limits rules

During an otherwise quiet Summer at the Commodity Futures Trading Commission (CFTC), agency staff hosted a public Roundtable where commercial end-users and other market participants could comment on the CFTC’s re-proposed rules to implement the position limits and aggregation provisions of the Dodd-Frank Act.  The common theme from end-users was that the CFTC’s proposals would … Continue Reading
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