The Commodity Futures Trading Commission’s Market Participants Division and Division of Market Oversight announced an extension of temporary Brexit-related no-action positions. The action preserves certain arrangements while the CFTC and UK authorities continue evaluating UK law and developing appropriate UK-specific comparability determinations and exemptive orders.

For affected firms, this provides additional planning time. It also creates an immediate documentation task: confirm that reliance on the relief reflects the newly issued staff letter.

What Changed

CFTC Staff Letter No. 26-28 takes effect immediately and supersedes Letter No. 24-11, as amended by Letter No. 26-10. Firms may no longer rely on the superseded letter.

The new positions expire on the earlier of:

• December 31, 2027, or

• The effective date of the relevant UK-specific Commission action: a comparability determination for the covered swap-dealer requirements, or an exemptive order for UK trading facilities.

These are separate expiration triggers for the two categories of relief.

The practical consequence is that December 31, 2027 should be treated as an outside date. Firms should also monitor intervening Commission actions that could change their compliance basis sooner.

Why Brexit Relief Still Matters

The extension builds on a February 2019 joint statement by U.S. and UK authorities concerning continuity of derivatives trading and clearing after Brexit. Before the UK’s withdrawal, relevant CFTC determinations and exemptions addressed the EU regulatory framework. The current work involves analyzing the UK framework and, where appropriate, issuing UK-specific actions.

This illustrates a recurring challenge in cross-border regulation: continuity of business activity requires continuity of legal authority.

A trading relationship may remain commercially unchanged while the regulatory basis supporting it needs updating. For legal and compliance teams, the task is to connect the business arrangement to the correct current authority, conditions, and expiration triggers.

Two Categories of Relief

Certain Swap-Dealer Compliance Requirements

The underlying framework concerns EU comparability determinations addressing certain entity-level requirements, transaction-level requirements, and margin requirements for uncleared swaps. Comparability determinations recognize compliance with specified foreign requirements as satisfying corresponding CFTC requirements, within the relevant scope and conditions.

Under the extension, registered swap dealers can continue using the specified incorporated UK requirements, subject to the corresponding EU determinations’ conditions.

For a firm relying on this arrangement, a general statement that it complies with UK regulation is insufficient as a compliance explanation. Its records should identify the particular U.S. requirement, the corresponding UK requirement, and the conditions supporting reliance.

That mapping helps reviewers assess whether the relief fits the firm’s actual activities.

Eligible UK Trading Facilities and Their Counterparties

The historical framework also addresses multilateral trading facilities, or MTFs, and organised trading facilities, or OTFs. It concerns swap execution facility registration and the execution of swaps subject to the U.S. trade execution requirement.

Letter No. 26-28 covers UK-authorized facilities listed in its Appendix A and qualifying counterparties executing covered swaps on those facilities. Other obligations—including applicable reporting, trading eligibility, and clearing requirements—continue to apply.

The operational implication is that venue eligibility deserves a specific check. Firms should verify the legal entity operating the facility and its inclusion in the current appendix, rather than relying solely on a familiar brand name or an older internal list.

Execution arrangements should also be assessed alongside reporting and clearing workflows. Relief addressing one part of a transaction does not resolve every other compliance question.

What a No-Action Position Means

The letter expresses staff positions, does not bind the Commission, and remains subject to modification or termination. Materially different or changed facts may invalidate reliance.

For business planning, this makes the quality of the reliance analysis important. A firm should be able to explain why its activities fall within the letter and how it monitors the conditions supporting that conclusion.

Launch Legal’s view is that temporary relief is most useful when it is paired with a clear transition plan. Additional time allows a firm to prepare for replacement authority, address documentation gaps, and assign responsibility for monitoring developments.

Practical Steps for Affected Firms

Update the legal basis for reliance. Review compliance memoranda, policies, and other materials citing Letters 24-11 or 26-10. Assess the new letter before replacing those references.

Check the relevant entities and activities. Identify which swap dealers, trading facilities, counterparties, and transactions depend on the relief.

Maintain a requirements map. Connect each reliance position to the relevant obligation and conditions. Record the responsibilities that remain outside that relief.

Track both expiration routes. Calendar December 31, 2027 and assign responsibility for monitoring UK-specific comparability determinations and exemptive orders.

Plan for transition. Consider what changes in procedures, agreements, disclosures, or technology would be necessary if replacement authority introduces different conditions.

These steps are preparation considerations. The appropriate process will depend on the firm’s regulatory status, trading activity, and existing compliance arrangements.

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This blog post is for informational purposes only and is not legal advice. Please consult with a Launch Legal attorney regarding your specific situation.