CFTC additional proposals regarding Regulation AT
Published: 08 November 2016
Last week, the CFTC approved a supplemental proposal to Regulation Automated Trading (Reg AT) by 2-1. The supplemental notice of proposed rulemaking for Reg AT (the Supplemental) amends and streamlines certain requirements of proposed Reg AT, to which AIMA has submitted two consultation responses this year. Notably, the Supplemental revises the Reg AT proposed risk control framework to concentrate pre-trade risk controls at a minimum of two levels rather than three. In addition, the Supplemental establishes a threshold of existing and new Commission registrants that are considered “AT Persons” under Regulation AT by adding a minimum trading volume test to the criteria for determining who is an AT Person. The Supplemental also addresses algorithmic trading source code through new provisions regarding recordkeeping and access - specifically, the Supplemental proposes that access to source code by the Division of Market Oversight be limited to “special calls” issued by the CFTC itself, although still proposing that this take place without a subpoena. The Supplemental will be published in the Federal Register and open for a 60-day public comment period. If members have any questions, please contact Oliver Robinson.