Staff from the Commodity Futures Trading Commission’s (CFTC) Division of Market Oversight issued No-Action Relief Letter 25-25 on July 31, 2025 to help ease compliance burdens placed on reporting counterparties in meeting the agency’s current swap data error reporting requirements. In the letter, CFTC staff cited the fact that numerous swap data error notifications filed with the agency have “not been utilized as originally intended” following the CFTC’s adoption of 2020 amendments to its swap data reporting rules.
Generally, under Part 43 and Part 45 of the CFTC’s regulations, swap execution facilities (SEFs), designated contract markets (DCMs) and reporting counterparties must notify CFTC staff if they will not timely correct a swap data error or errors. In particular, CFTC Regulations 43.3(e)(1)(ii) and 45.14(a)(1)(ii) require SEFs, DCMs and reporting counterparties to submit relevant swap reporting error notifications for all errors that cannot be timely corrected, whether or not such errors are material.
The International Swaps and Derivatives Association (ISDA) and the Securities Industry and Financial Markets Association (SIFMA) requested relief from these requirements on behalf of their memberships for swap data errors that do not exceed a certain threshold. In granting the industry trade associations’ request, CFTC staff found persuasive both the arguments made in ISDA and SIFMA letter, as well as representations made by various reporting counterparties who have met with staff during the past two and a half years following the implementation of the error notification requirements.
No-Action Letter 25-25 expressly provides that the CFTC will not take an enforcement action against a reporting counterparty that does not file an error notification when it initially discovers a swap reporting error if such reporting counterparty reasonably determines that “the number of reportable trades affected by the error does not exceed five percent of the reporting counterparty’s open swaps for the relevant asset class in swaps for which it was the reporting counterparty.” The CFTC noted that the five percent threshold shall be calculated in accordance with CFTC Regulation 45.14 and added that reporting counterparties may still notify CFTC staff for errors below the five percent threshold if the reporting counterparty believes data quality for the CFTC or users of publicly disseminated swap data would be adversely affected by the error.
No-Action Letter 25-25 can be found here.
