Sunset of Large Trader Reporting (LTR) for Physical Commodity Swaps pursuant to Regulation 20.9
Summary
SIFMA, The International Swaps and Derivatives Association, Inc. (ISDA), and the Futures Industry Association (FIA) are provided comments to request that the U.S. Commodity Futures Trading Commission’s (CFTC) formally sunset the requirements related to certain physical commodity swap positions pursuant to Part 20 of the Commission’s regulations (the “Swaps LTR Rules”).
Excerpt
The Swaps LTR Rules, which were finalized in 2011, were expressly intended to operate as a temporary measure only until the Commission established a comprehensive swaps data reporting framework. 1 Indeed, when the Commission adopted the Swaps LTR Rules, it acknowledged that the rule no longer would be necessary once swap data repositories were fully operable. 2 A comprehensive framework for swaps reporting—now codified in Parts 43 and 45 of the Commission’s regulations—has long been fully implemented and provides the Commission with robust, transaction-level swap data for surveillance and oversight purposes. Moreover, swap data currently reported to the Commission enables effective surveillance of market participants’ compliance with position limits for economically equivalent swaps, rendering the Swaps LTR Rules unnecessary and duplicative.
The Associations therefore appreciate the recent statements of CFTC Chairman Selig directing the agency to consider whether these requirements should be eliminated, 3 and respectfully request that the Commission expeditiously sunset these requirements. Declining to do so would require reporting counterparties to continue to expend critical time and resources identifying physical commodity swaps subject to the Swaps LTR Rules, converting the swap transactions into futures equivalent positions, validating position data, and submitting unnecessarily duplicative reports to the Commission. Our member firms have indicated that the annual cost of compliance with the Swaps LTR Rules can be well over $1 million for a reporting firm. Taking into account the number of reporting firms, sunsetting the rules could save market participants tens of millions of dollars year over year.
To further support this request, we are attaching a prior comment letter from 2024 4 that provides a more comprehensive discussion of the relevant background and considerations and a copy of a petition to repeal the Swaps LTR Rules that was submitted to the CFTC in September 2025. 5 The Associations, individually and collectively, have engaged with the CFTC on this issue through the years and endorse the information set forth in the submissions as it reflects the extensive knowledge and experience of derivatives professionals within our membership.
- CFTC regulation 20.9(a), 17 C.F.R. § 20.9(a).
- Federal Register: Large Trader Reporting for Physical Commodity Swaps, 76 Fed. Reg. 43851 at 43851 (Jul. 11, 2011). (The Commission acknowledged that the rule no longer would be necessary once “[swap data repositories] are capable of processing positional data in a manner that would enable the Commission to effectively oversee and surveil paired swaps trading and paired swap markets.”); see also Federal Register: Swap Data Recordkeeping and Reporting Requirements, 85 Fed. Reg. 75503 at 75545 (Nov. 25, 2020) (In amending swap data reporting requirements in 2020, the Commission noted that it may address Part 20 reporting requirements in the future).
- Michael Selig, Chairman, CFTC, Keynote Remarks at ISDA 40th Annual General Meeting (Apr. 30, 2026), https://www.cftc.gov/PressRoom/SpeechesTestimony/opaselig5.
- Joint Response to Notice of Intent to Renew Collection 3038–0095; Large Trader Reporting for Physical Commodity Swaps, May 13, 2024, available at https://www.isda.org/2024/05/14/isda-and-fia-response-to-cftc-on-swaps-ltr-rules/
- Petition for Repeal of a Rule (17 C.F.R. § 13.1): Large Trader Reporting for Physical Commodity Swaps, Sept. 22, 2025, available at https://www.fia.org/fia/articles/fia-asks-cftc-sunset-swaps-ltr-rules.