ICI and SIFMA AMG Request Confirmation from CFTC and NFA Regarding Reporting Obligations of Funds' Wholly-Owned Subsidiaries (pdf)

April 10, 2013 VIA ELECTRONIC MAIL Mr. Gary Barnett Director Division of Swap Dealer and Intermediary Oversight Commodity Futures Trading Commission Three Lafayette Centre 1155 21st Street, NW Washington, DC 20581 Re: Request for Confirmation and No-Action Relief Regarding Application of Certain Re- porting Obligations under Part 4 of the CFTC’s Regulations to Subsidiaries of Registered Investment Companies Dear Mr. Barnett: The Investment Company Institute (“ICI”)1 and the Asset Management Group of the Securi- ties Industry and Financial Markets Association (“AMG”),2 on behalf of our members, respectfully re- quest that the Division of Swap Dealer and Intermediary Oversight (“Division”) provide confirmation and no-action relief regarding the application of certain of the reporting obligations under Part 4 of the Commodity Futures Trading Commission’s (“CFTC”) regulations to commodity pool operators (“CPOs”) of registered investment companies (“registered funds”) that trade in commodity interests through wholly-owned subsidiaries (known as controlled foreign corporations or “CFCs”) that are con- 1 The Investment Company Institute is the national association of U.S. investment companies, including mutual funds, closed-end funds, exchange-traded funds, and unit investment trusts. ICI seeks to encourage adherence to high ethical stan- dards, promote public understanding, and otherwise advance the interests of funds, their shareholders, directors, and advis- ers. Members of ICI manage total assets of $14.7 trillion and serve over 90 million shareholders. 2 The AMG’s members represent U.S. asset management firms whose combined assets under management exceed $20 tril- lion. The clients of AMG member firms include, among others, registered investment companies, endowments, state and local government pension funds, private sector Employee Retirement Income Security Act of 1974 pension funds and pri- vate funds such as hedge funds and private equity funds. Mr. Gary Barnett April 10, 2013 Page 2 solidated with the registered fund for financial reporting purposes.3 First, we request that the Division confirm that registered fund CPOs may defer their reporting obligations under Regulation 4.27 under the CEA for their consolidated CFCs until the first applicable reporting period ending after the com- pliance date of the CFTC’s final harmonization rule (“Compliance Date”).4 Second, we request that the Division provide no-action relief that would permit a CPO of a registered fund that trades in com- modity interests through a CFC and that files with the National Futures Association (“NFA”) an an- nual report for the CFC under Regulation 4.22 under the CEA, to include in that report the audited financial statements of the registered fund that consolidate the CFC, in lieu of separate financial state- ments of the CFC. Consistent with the timing confirmation requested above, we also request that the Division confirm that the filing of such an annual report would not apply for periods prior to the fiscal year of the registered fund that ends after the Compliance Date. In both cases, the requested confirma- tion or relief is consistent with how these registered funds prepare their audited financial statements under U.S. GAAP and the Investment Company Act of 1940 (“Investment Company Act”).5 We appreciate the Division’s prompt response to our request, as many registered fund CPOs would otherwise be required to comply with Regulation 4.27 for their CFCs with respect to the first quarter of this year and, depending on a CFC’s fiscal year, any applicable filing obligations under Regu- lation 4.22 could be triggered within the next several months. 3 As a result of the CFTC’s amendments to Regulation 4.5 under the Commodity Exchange Act (“CEA”), many registered investment advisers that advise registered investment companies must register as CPOs. Although ICI has judicially chal- lenged amended Regulation 4.5, see Complaint, Investment Company Institute, et al. v. CFTC, Case No. 1:12-cv-00612 (D.D.C. Apr. 17, 2012), it is committed to assisting its members’ efforts to comply with the amended regulation. At the same time the CFTC amended Regulation 4.5, it also rescinded Regulation 4.13(a)(4), which provided an exemption from registration for CPOs of private funds. Some registered fund CPOs also advise private funds for which they no longer can claim a CPO exemption, or with respect to which they already act as registered CPOs. These registered fund CPOs comply with Regulation 4.27 with respect to their private funds according to the compliance dates specified by the CFTC as appli- cable to all CPOs, as these obligations are not deferred pending the CFTC’s harmonization rule. See Commodity Pool Oper- ators and Commodity Trading Advisors: Compliance Obligations, 77 Fed. Reg. 11252 (February 24, 2012); correction notice published at 77 Fed. Reg. 17328 (March 26, 2012) (“Amendment Release”). The requested relief would, however, apply to the reporting obligations of these registered fund CPOs with respect to their CFCs. 4 The Division staff has confirmed that the effective date of the harmonization rule will be 60 days after it is published in the Federal Register, and the compliance date will be another 60 days following the effective date. See Amendment Release, supra note 3. 5 The request is also consistent with a similar request ICI has made to the NFA requesting confirmation that registered fund CPOs that consolidate the CFC with the registered fund for financial reporting purposes may defer the reporting obligation under NFA Compliance Rule 2-46 for the CFC until the first applicable reporting period ending after the Compliance Date. See Letter from Karrie McMillan, General Counsel, Investment Company Institute, to Mr. Daniel A. Driscoll, Execu- tive Vice President, Chief Operating Officer, and Mr. Thomas W. Sexton, III, Senior Vice President, General Counsel and Secretary, National Futures Association, dated April 10, 2013. Mr. Gary Barnett April 10, 2013 Page 3 Request for Confirmation under Regulation 4.27 While the CFTC has confirmed that CPOs to registered funds that were required to register as a result of the amendments to Regulation 4.5 under the CEA may defer compliance with reporting ob- ligations under Regulation 4.27 under the CEA for their registered funds until after the Compliance Date, it is unclear whether this deferral would also apply to these registered funds’ CFCs.6 We request that the Division confirm that CPOs of registered funds that consolidate their CFCs for financial re- porting purposes may delay reporting under Regulation 4.27 for these CFCs until the next applicable reporting period following the Compliance Date, when reporting may be provided on a consolidated basis, consistent with how these registered funds prepare their audited financial statements.7 For tax purposes, some registered funds trade in commodity interests through wholly-owned subsidiaries known as CFCs.8 In most cases, registered funds that trade through such CFCs consolidate the financial statements of the CFC into the registered fund’s financial statements for financial report- ing purposes. Consolidation results in the financial statements disclosing the CFC’s investments as if the registered fund held them directly. This practice is permitted by U.S. GAAP and has been explicitly permitted by the Securities and Exchange Commission (“SEC”) staff for SEC reporting purposes.9 More recently, the SEC staff has required registered funds to consolidate wholly-owned subsidiaries when that subsidiary is an extension of the parent investment company’s operations.10 6 Amendment Release, supra note 3, at 11252 (“Entities required to register due to the amendments to § 4.5 shall be subject to the Commission’s recordkeeping, reporting, and disclosure requirements pursuant to part 4 of the Commission’s regula- tions within 60 days following the effectiveness of a final rule implementing the Commission’s proposed harmonization effort pursuant to the concurrent proposed rulemaking.”) The CFTC has clarified that this delay applies to a registered CPO’s reporting obligations under Regulation 4.27 with respect to registered funds, stating that this language “suspends compliance with Rule 4.27 for registered investment companies, pending a final harmonization rule.” Investment Company Institute, et al. v. CFTC, supra note 3 (Defendant CFTC’s Reply to Plaintiff’s Supplemental Response (Oct. 25, 2012), at 3). 7 Our request under Regulation 4.27 extends to both filings with respect to such CFCs on Form CPO-PQR and Form CTA-PR, as the same issues are raised with respect to both reporting obligations. We also request that the relief extend to CPOs and CTAs that are in the process of converting from separate financial reporting to consolidated financial reporting for the registered fund and CFCs they operate/advise. In particular, the relief should apply to CPOs and CTAs that oper- ate/advise at least one registered fund that consolidates its CFC for financial reporting purposes, provided that the remain- ing registered funds’ next audited annual financial statements consolidate their CFCs for financial reporting purposes. 8 Amendment Release, supra note 3, at 11260. 9 See FASB Accounting Standards Codification 946-810-45; Fidelity Investments, SEC No-Action Letter (April 29, 2008). 10 See AICPA Investment Companies Expert Panel Meeting Minutes (September 13, 2012) available at http://www.aicpa.org/InterestAreas/FRC/IndustryInsights/DownloadableDocuments/INV/INV_EP_Minutes/2012/IN V_EP_September13_2012_Meeting.pdf. Mr. Gary Barnett April 10, 2013 Page 4 Registered fund complexes that consolidate their funds’ CFCs have established financial report- ing systems that combine the assets, liabilities, income, and expenses of the registered fund and the CFC for reporting purposes. For CPOs of such registered funds, complying with Regulation 4.27 only with respect to the CFC prior to the Compliance Date would require the CPO to engage in a manual process to isolate the CFC’s data. Such a manual process may increase the likelihood of error. Alterna- tively, the CPO may implement systems changes to isolate the CFC’s data. However, such systems changes would be in place for only a limited period of time (i.e., until the Compliance Date, at which time the registered fund could then comply with the reporting requirement on a consolidated basis). Following the Compliance Date, when the registered fund is required to comply with Regulation 4.27, additional systems changes would then be required to revert back to reporting on a consolidated basis. We therefore request confirmation that CPOs of registered funds that consolidate their CFCs for financial reporting purposes may delay reporting under Regulation 4.27 for these CFCs until the next applicable reporting period following the Compliance Date.11 As of that date, registered fund CPOs will be required to also report under Regulation 4.27 for the registered funds that own such CFCs, and would provide Regulation 4.27 reporting for each registered fund and its CFC on a consoli- dated basis, which is consistent with how these registered funds provide financial information in their audited financial statements, as included in annual reports provided to shareholders and filed with the SEC. Request for No-Action Relief under Regulation 4.22 We also request that the Division provide no-action relief to permit CPOs of registered funds that consolidate their CFCs for financial reporting purposes to file with the NFA an annual report for the CFC, to the extent required by Regulation 4.22, that contains audited consolidated financial state- ments of the registered fund, in lieu of separate financial statements of the CFC. We request that the Division permit registered fund CPOs to file the CFC’s first such annual report with respect to the fis- cal year of the registered fund that ends after the Compliance Date.12 Preparing the annual report in this manner would be consistent with how these registered funds provide financial information in their audited financial statements, as included in annual reports provided to shareholders and filed with the SEC, as discussed below. Regulation 4.22(c) states that, “[e]xcept as provided in paragraph . . . (c)(8) of this section, each commodity pool operator registered or required to be registered under the Act must distribute an An- nual Report to each participant in each pool that it operates, and must electronically submit a copy of the Report and key financial balances from the Report to the National Futures Association pursuant to 11 To illustrate the timing under our request, if the Compliance Date is August 1, 2013, a quarterly Form CPO-PQR filer would file its first Form CPO-PQR with respect to the quarter ending September 30, 2013. 12 To illustrate the timing, if the Compliance Date is August 1, 2013, and a registered fund’s fiscal year end is September 30, the first such annual report would be for the fiscal year ending September 30, 2013. Mr. Gary Barnett April 10, 2013 Page 5 the electronic filing procedures of the National Futures Association, within 90 calendar days after the end of the pool’s fiscal year . . .” Pursuant to Regulation 4.22(c)(8), CFCs are not required to provide an annual report, either to the registered funds that own them or those funds’ shareholders.13 This re- quest would apply, however, to the extent that a CPO to a CFC might still have an obligation to file an annual report containing separate financial statements of the CFC with the NFA.14 Registered funds are required under the Investment Company Act to provide shareholders with semi-annual and annual reports, and file those reports with the SEC.15 Annual reports to shareholders must contain audited financial statements prepared in accordance with U.S. GAAP.16 As discussed above, most registered funds that own CFCs prepare their audited financial statements on a consolidat- ed basis. In those cases, the registered fund would not prepare separately audited financial statements for the CFC. Preparing separate audited financial statements for the CFC would require registered funds to incur unnecessary and redundant costs associated with preparing financial statements for the CFC, as well as costs associated with an audit of the CFC’s financial statements. It would be costly and inefficient, and would provide no additional benefit, for the CFTC to require the CPO to such a CFC to file an annual report with the NFA that includes separate audited financial statements of the CFC, as the registered fund’s audited consolidated financial statements would include all required financial information for the registered fund, including the holdings, gains and losses, and other financial state- ment amounts attributable to the CFC. For these reasons, we request that the Division provide no-action relief to permit registered fund CPOs that consolidate their CFCs for financial reporting purposes to file with the NFA an an- nual report for the CFC that contains audited consolidated financial statements of the registered fund. We also request that the Division permit such CPOs to file the CFC’s first annual report with respect to the fiscal year of the registered fund that ends after the Compliance Date. Filing in this manner would be consistent with how registered funds that consolidate their CFCs prepare their financial statements for purposes of U.S. GAAP and SEC regulations. * * * * 13 Regulation 4.22(c)(8) states that for purposes of the annual report distribution requirement, the term “participant” of a pool does not include a commodity pool operated by the same or an affiliated CPO. See also Division of Swap Dealer and Intermediary Oversight Responds to Frequently Asked Questions – CPO/CTA: Amendments to Compliance Obligations, available at http://www.cftc.gov/ucm/groups/public/@newsroom/documents/file/faq_cpocta.pdf. 14 In addition, under Regulation 4.7(b)(3), a CPO relying on that regulation with respect to an “exempt pool” must file with the NFA an annual report meeting certain requirements within 90 calendar days after the end of the pool’s fiscal year. CPOs of funds of funds, however, whether relying on Regulation 4.22 or Regulation 4.7(b)(3), have up to 180 days to file the annual report. See Regulation 4.22(f)(2) under the CEA. 15 See Rules 30e-1 and 30b2-1 under the Investment Company Act. 16 See Rules 3-18 and 4-01 of Regulation S-X. Mr. Gary Barnett April 10, 2013 Page 6 We sincerely appreciate the willingness of CFTC staff to address the industry’s concerns. If you have questions or require further information, please contact me at 202/326-5815, Sarah A. Bessin at 202/326-5835 or Rachel H. Graham at 202/326-5819 at the ICI, or Tim Cameron at 212/313- 1389 or Matt Nevins at 212/313-1176 at AMG. Sincerely, /s/ Karrie McMillan Karrie McMillan General Counsel /s/ Timothy W. Cameron Timothy W. Cameron, Esq. Managing Director, Asset Management Group Securities Industry and Financial Markets Association /s/ Matthew J. Nevins Matthew J. Nevins, Esq. Managing Director and Associate General Counsel, Asset Management Group Securities Industry and Financial Markets Association cc: Amanda Olear, Special Counsel Michael Ehrstein, Attorney-Advisor Division of Swap Dealer and Intermediary Oversight Commodity Futures Trading Commission Daniel A. Driscoll, Executive Vice President, Chief Operating Officer Thomas W. Sexton, III, Senior Vice President, General Counsel and Secretary National Futures Association Jaime Eichen, Chief Accountant Division of Investment Management Securities and Exchange Commission April 10, 2013 VIA ELECTRONIC MAIL Mr. Daniel A. Driscoll Executive Vice President, Chief Operating Officer Mr. Thomas W. Sexton, III Senior Vice President, General Counsel and Secretary National Futures Association 300 S. Riverside Plaza, #1800 Chicago, Illinois 60606-6615 Re: Application of NFA Compliance Rule 2-46 to Subsidiaries of Registered Investment Companies Dear Mr. Driscoll and Mr. Sexton: The Investment Company Institute (“ICI”)1 and the Asset Management Group of the Securi- ties Industry and Financial Markets Association (“AMG”),2 on behalf of our members, respectfully re- quest that the National Futures Association (“NFA”) provide confirmation3 regarding the application 1 The Investment Company Institute is the national association of U.S. investment companies, including mutual funds, closed-end funds, exchange-traded funds, and unit investment trusts. ICI seeks to encourage adherence to high ethical stan- dards, promote public understanding, and otherwise advance the interests of funds, their shareholders, directors, and advis- ers. Members of ICI manage total assets of $14.7 trillion and serve over 90 million shareholders. 2 The AMG’s members represent U.S. asset management firms whose combined assets under management exceed $20 tril- lion. The clients of AMG member firms include, among others, registered investment companies, endowments, state and local government pension funds, private sector Employee Retirement Income Security Act of 1974 pension funds and pri- vate funds such as hedge funds and private equity funds. 3 As a result of the Commodity Futures Trading Commission’s (“CFTC”) amendments to Regulation 4.5 under the Com- modity Exchange Act (“CEA”), many registered investment advisers that advise registered investment companies must regis- ter as commodity pool operators (“CPOs”). Although ICI has judicially challenged amended Regulation 4.5, see Complaint, Investment Company Institute, et al. v. CFTC, Case No. 1:12-cv-00612 (D.D.C. Apr. 17, 2012), it is committed to assisting its members’ efforts to comply with the amended regulation. Mr. Daniel A. Driscoll and Mr. Thomas W. Sexton, III April 10, 2013 Page 2 of NFA Compliance Rule 2-46 to CPOs of registered investment companies (“registered funds”) that trade in commodity interests through wholly-owned subsidiaries (known as controlled foreign corpora- tions or “CFCs”). Specifically, ICI and AMG request that NFA confirm that CPOs to registered funds that consolidate the CFC with the registered fund for financial reporting purposes may defer the re- porting obligation under Compliance Rule 2-46 for the CFC until the first applicable reporting period ending after the compliance date of the CFTC’s final harmonization rule (“Compliance Date”).4 The requested confirmation is consistent with how these registered funds prepare their audited financial statements under U.S. GAAP and the Investment Company Act of 1940 (“Investment Company Act”). The request is also consistent with a similar request ICI has made to the CFTC’s Division of Swap Dealer and Intermediary Oversight requesting confirmation that registered fund CPOs may defer their reporting obligations under Regulation 4.27 under the CEA for their consolidated CFCs until the first applicable reporting period ending after the Compliance Date.5 We appreciate NFA’s prompt response to our request, as many registered fund CPOs could otherwise be required to comply with Rule 2-46 for their CFCs with respect to the first quarter of this year. Discussion NFA agreed in discussions with ICI, as memorialized in a letter from ICI dated December 28, 2012,6 that reporting under Compliance Rule 2-46 by CPOs of registered funds that were required to register as CPOs as a result of the CFTC’s recent amendments to Regulation 4.5 should be deferred until the Compliance Date. The December ICI Letter, however, did not explicitly address whether re- 4 The staff of the CFTC’s Division of Swap Dealer and Intermediary Oversight Division has confirmed that the effective date of the harmonization rule will be 60 days after it is published in the Federal Register, and the compliance date will be another 60 days following the effective date. See Commodity Pool Operators and Commodity Trading Advisors: Compliance Obligations, 77 Fed. Reg. 11252 (February 24, 2012); correction notice published at 77 Fed. Reg. 17328 (March 26, 2012). The CFTC has clarified that this delay applies to a registered CPO’s reporting obligations under Regulation 4.27 with re- spect to registered funds, stating that this language “suspends compliance with Rule 4.27 for registered investment compa- nies, pending a final harmonization rule.” Investment Company Institute, et al. v. CFTC, supra note 3 (Defendant CFTC’s Reply to Plaintiff’s Supplemental Response (Oct. 25, 2012), at 3). 5 Letter from Karrie McMillan, General Counsel, Investment Company Institute, to Mr. Gary Barnett, Director, Division of Swap Dealer and Intermediary Oversight, Commodity Futures Trading Commission, dated April 10, 2013. 6 Letter from Karrie McMillan, General Counsel, Investment Company Institute, to Mr. Daniel A. Driscoll, Executive Vice President, Chief Operating Officer, and Mr. Thomas W. Sexton, III, Senior Vice President, General Counsel and Secretary, National Futures Association, dated December 28, 2012 (“December ICI Letter”). We note that, at the same time the CFTC amended Regulation 4.5, it also rescinded Regulation 4.13(a)(4), which provided an exemption from registration for CPOs of private funds. Some registered fund CPOs also advise private funds for which they no longer can claim a CPO exemption, or with respect to which they already act as registered CPOs. While these registered fund CPOs would be sub- ject to Rule 2-46 with respect to their private funds, the requested relief would apply to the reporting obligations of these registered fund CPOs with respect to their CFCs. Mr. Daniel A. Driscoll and Mr. Thomas W. Sexton, III April 10, 2013 Page 3 porting would also be deferred for any CFCs of such registered funds. For the reasons discussed below, we request that NFA confirm that CPOs to registered funds that consolidate their CFC with the regis- tered fund for financial reporting purposes may defer the reporting obligation under Compliance Rule 2-46 for the CFC until the first applicable reporting period ending after the Compliance Date, consis- tent with how these registered funds prepare their audited financial statements.7 Compliance Rule 2-46 addresses the quarterly reporting obligations to NFA of a CPO that is an NFA member. NFA recently amended Compliance Rule 2-46 to provide that a CPO member that has any reporting obligation under Regulation 4.27 under the CEA must satisfy its reporting obliga- tion under Compliance Rule 2-46 for each pool it operates by filing with NFA applicable schedules of CFTC Form CPO-PQR. Small and mid-size CPOs must also include a schedule of investments with their quarterly filings, although the threshold under the schedule of investments is revised from 10% of the pool’s net asset value at the end of the quarterly reporting period to 5% to conform to CFTC re- quirements. The amendments make certain other changes to the reporting obligation including, among other things, revising the quarterly filing deadline with NFA from 45 days after the end of each quarterly reporting period to 60 days after the end of each of the first three quarters of the year, and re- quiring that a year-end report be filed with NFA within 90 days of the calendar year end. The amend- ments also add a requirement for NFA members that are CTAs and that are subject to a reporting obli- gation under Regulation 4.27, to file with NFA CFTC Form CTA-PR, along with certain additional information, on a quarterly basis. These quarterly CTA filings are required to be submitted within 45 days after the end of each of the first three quarters of the year, with a year-end report required within 45 days of the calendar year end. In most cases, registered funds that trade through CFCs consolidate the financial statements of the CFC into the registered fund’s financial statements for financial reporting purposes. Consolidation results in the financial statements disclosing the CFC’s investments as if the registered fund held them directly. This practice is permitted by U.S. GAAP and has been explicitly permitted by the Securities and Exchange Commission (“SEC”) staff for SEC reporting purposes.8 More recently, the SEC staff has required registered funds to consolidate wholly-owned subsidiaries when that subsidiary is an exten- 7 Our request under Compliance Rule 2-46 also extends to quarterly commodity trading advisor (“CTA”) filings under amended Compliance Rule 2-46 with respect to such CFCs, as the same issues are raised with respect to both reporting obli- gations. We also request that the confirmation extend to CPOs and CTAs that are in the process of converting from sepa- rate financial reporting to consolidated financial reporting for the registered funds and CFCs they operate/advise. In par- ticular, we request that the confirmation also apply to CPOs and CTAs that operate/advise at least one registered fund that consolidates its CFC for financial reporting purposes, provided that the remaining registered funds’ next audited annual financial statements consolidate their CFCs for financial reporting purposes. 8 See FASB Accounting Standards Codification 946-810-45; Fidelity Investments, SEC No-Action Letter (April 29, 2008). Mr. Daniel A. Driscoll and Mr. Thomas W. Sexton, III April 10, 2013 Page 4 sion of the parent investment company’s operations.9 Registered fund complexes that consolidate their funds’ CFCs have established financial report- ing systems that combine the assets, liabilities, income, and expenses of the registered fund and the CFC for reporting purposes. For CPOs of such registered funds, complying with Compliance Rule 2-46 only with respect to the CFC prior to the Compliance Date would require the CPO to engage in a manual process to isolate the CFC’s data. Such a manual process may increase the likelihood of error. Alterna- tively, the CPO may implement systems changes to isolate the CFC’s data. However, such systems changes would be in place for only a limited period of time (i.e., until the Compliance Date, at which time the registered fund could then comply with the reporting requirement on a consolidated basis). Following the Compliance Date, when the registered fund is required to comply with Compliance Rule 2-46, additional systems changes would then be required to revert back to reporting on a consolidated basis. We therefore request confirmation that CPOs of registered funds that consolidate their CFCs for financial reporting purposes may delay reporting under Compliance Rule 2-46 for these CFCs until the next applicable reporting period following the Compliance Date.10 As of that date, registered fund CPOs will be required to also report under Compliance Rule 2-46 for the registered funds that own such CFCs, and would provide Compliance Rule 2-46 reporting for each registered fund and its CFC on a consolidated basis, which is consistent with how these registered funds provide financial informa- tion in their audited financial statements, as included in annual reports provided to shareholders and filed with the SEC. * * * * 9 See AICPA Investment Companies Expert Panel Meeting Minutes (September 13, 2012) available at http://www.aicpa.org/InterestAreas/FRC/IndustryInsights/DownloadableDocuments/INV/INV_EP_Minutes/2012/IN V_EP_September13_2012_Meeting.pdf. 10 To illustrate the timing under our request, if the Compliance Date is August 1, 2013, a quarterly NFA-PQR filer would file its first NFA-PQR with respect to the quarter ending September 30, 2013. Mr. Daniel A. Driscoll and Mr. Thomas W. Sexton, III April 10, 2013 Page 5 We sincerely appreciate the willingness of the NFA staff to address the industry’s concerns. If you have questions or require further information, please contact me at 202/326-5815, Sarah A. Bessin at 202/326-5835, or Rachel H. Graham at 202/326-5819 at the ICI, or Tim Cameron at 212/313- 1389 or Matt Nevins at 212/313-1176 at AMG. Sincerely, /s/ Karrie McMillan Karrie McMillan General Counsel /s/ Timothy W. Cameron Timothy W. Cameron, Esq. Managing Director, Asset Management Group Securities Industry and Financial Markets Association /s/ Matthew J. Nevins Matthew J. Nevins, Esq. Managing Director and Associate General Counsel, Asset Management Group Securities Industry and Financial Markets Association cc: Gary Barnett, Director Amanda Olear, Special Counsel Michael Ehrstein, Attorney-Advisor Division of Swap Dealer and Intermediary Oversight Commodity Futures Trading Commission Jaime Eichen, Chief Accountant Division of Investment Management Securities and Exchange Commission