Futures Industry Association recommends simplifying CFTC rules

The Futures Industry Association (FIA) offered suggestions to simplify and modernize U.S. Commodity Futures Trading Commission (CFTC) rules.

The association’s response was a result of the CFTC’s call for comments on its Project KISS, which stands for “Keep It Simple, Stupid,” in March. Project Kiss is an agency-wide internal review of CFTC rules, regulations, and practices to identify those areas that can be simplified to make them less burdensome and less costly.

“FIA and our members appreciate that Chairman (Christopher) Giancarlo and the CFTC are not only willing to evaluate current policies for efficiency and effectiveness but are also willing to open this process to public comment,” FIA President and CEO Walt Lukken said.

FIA identified several areas where regulations would benefit from simplification, modification, or reconsideration. They suggest tailoring cross-border rules so as to prevent market fragmentation, enhancing the predictability and transparency of enforcement, implementing appropriate position limits, retaining the $8 billion swap dealer de minimis threshold, and recordkeeping obligations and duplicative regulatory reporting. FIA also recommended coordination among financial regulators on cybersecurity initiatives, ensuring capital rules allow for healthy derivatives markets, and consideration of principles-based alternatives to the proposed Regulation AT.

“Our proposals are designed to maximize the commission’s ability to promote competitive, well-regulated markets while reducing unnecessary burdens on market participants,” Lukken said. “We look forward to working with the commission on these issues and commend the agency for the progress it has already made in a number of these areas.”