Regulations Governing Separate Account Treatment for Withdrawal of Customer Initial Margin

The Commission is amending part 1, with supporting amendments in parts 1, 22, 30, and 39, to codify via direct application to all FCMs the conditional and time-limited no-action position in CFTC Letter No. 19-17, which allows DCOs to permit FCM clearing members to treat the separate accounts of a single customer as accounts of separate entities for purposes of Commission regulation 39.13(g)(8)(iii). The amendments add for all FCMs a margin adequacy requirement similar to that applied to clearing FCMs by DCOs in regulation 39.13(g)(8)(iii) (prohibiting margin withdrawals if such withdrawals would create or exacerbate an under-margining scenario) and provide for separate account treatment for purposes of the margin adequacy requirement, subject to certain conditions designed to mitigate risk consistent with CEA section 4d(a)(2) and the Commission’s implementing regulations. The amendments add new Commission regulation § 1.44 and new appendix A to part 1 and make supporting amendments to Commission regulations §§ 1.3, 1.17, 1.20, 1.32, 1.58, and 1.73 in part 1, 22.2 in part 22, 30.2 and 30.7 in part 30, and 39.13 in part 39.

The latest form for Regulations Governing Separate Account Treatment for Withdrawal of Customer Initial Margin expires 2028-05-31 and can be found here.