Proposal to Amend Rule 1.31 of the CEA: Recordkeeping
Summary
SIFMA provided comments to the Commodity Futures Trading Commission (CFTC) on Recordkeeping. SIFMA supports the Proposal and urges the Commission to adopt the Proposal as quickly as possible. The Proposal seeks to amend Rule 1.31 of the Commodity Exchange Act to do three main things: (1) remove the requirement to keep electronic records in their “native” format; (2) replace the “non-rewritable, non-erasable,” or “write once, read many” (“WORM”) electronic record storage requirement with a technology neutral, principles-based standard; and (3) eliminate the requirement to engage a third-party Technical Consultant. SIFMA has long held that Rule 1.31 is outmoded and should be amended to allow firms to use the most current technology, and appreciates the Commission’s efforts to update this rule.
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Excerpt
VIA: https://comments.cftc.gov
Christopher Kirkpatrick
Secretary of the Commission
Commodity Futures Trading Commission
Three Lafayette Center
1155 21st St. NW, Washington, DC 20581
Re: CFTC Proposed Rule – Recordkeeping (RIN 3038-AE36)
Dear Mr. Kirkpatrick:
The Securities Industry and Financial Markets Association (“SIFMA”) appreciates the opportunity to comment on the above-referenced rule proposal (“Proposal”). SIFMA fully supports the Proposal and urges the Commission to adopt the Proposal as quickly as possible. The Proposal seeks to amend Rule 1.31 of the Commodity Exchange Act (“CEA”) to do three main things: (1) remove the requirement to keep electronic records in their “native” format; (2) replace the “non-rewritable, non-erasable,” or “write once, read many” (“WORM”) electronic record storage requirement with a technology neutral, principles-based standard; and (3) eliminate the requirement to engage a third-party Technical Consultant. SIFMA has long held that Rule 1.31 is outmoded and should be amended to allow firms to use the most current technology, and appreciates the Commission’s efforts to update this rule.
SIFMA particularly supports the technology neutral principles espoused in the Proposal. In an age when technology makes daily advancements, it is critical that rules are flexible enough to ensure that financial institutions may use the most current technology available. The Proposal will almost certainly provide clear cost reductions for SIFMA members, particularly the elimination of the requirement to retain a Technical Consultant. Furthermore, SIFMA does not believe the Commission should narrowly define “metadata.” We believe the current usage is sufficiently flexible to encompass current and future technology standards.
Although SIFMA strongly supports the Proposal, we believe some minor changes would further clarify and strengthen the Proposal. We have outlined each in detail below.