The CFTC proposed requiring U.S. commodity funds and trading advisers with at least $1 billion in assets to report quarterly on use of leverage, counterparty risk and trading positions to give regulators information on financial-system threats.
CFTC commissioners voted 5-0 on Wednesday to seek comment on the measure drafted jointly with the SEC, which released a proposal a day earlier. The measure, part of the agencies' rule making under the Dodd-Frank Act, applies to hedge fund advisers, commodity pool operators and commodity trading advisers registered with both agencies.
The CFTC and SEC would share information reported under the new rules with other members of the Financial Stability Oversight Council, the panel of regulators assigned to monitor companies with potential to threaten the broader economy.
The SEC rule would require quarterly reports from about 200 U.S.-based hedge fund advisers overseeing more than 80% of assets under management. The proposal would let registrants managing $150 million to $1 billion report annually instead of quarterly.
Funds and trading advisers that register only with the CFTC would have to file forms “substantively identical” to those required from dual registrants, according to an agency summary. The proposal aims to protect the confidentiality of proprietary information provided to regulators, the SEC and CFTC said.