A dormant derivatives transaction execution facility is a type of trading platform for derivatives that has not seen any trading activity for a full twelve calendar months. However, if the facility was designated by the Commodity Futures Trading Commission (CFTC) within the last 36 months, it is not considered dormant, regardless of trading activity.
This term is primarily used in the context of financial regulation and trading law, particularly concerning derivatives markets. It is relevant to entities registered with the CFTC and may involve compliance with specific regulations. Users may manage related forms or procedures using templates available through services like US Legal Forms.
Here are a couple of examples of abatement:
For instance, if a derivatives transaction execution facility was established in January 2020 and has not facilitated any trades since January 2021, it would be classified as dormant. However, if it received its designation in December 2022, it would not be considered dormant despite the lack of trading activity.
| Term | Definition | Key Difference |
|---|---|---|
| Active derivatives transaction execution facility | A facility where trading occurs regularly. | Active facilities have ongoing trading activity, while dormant facilities do not. |
| Registered derivatives exchange | A marketplace for trading derivatives that is officially recognized by regulatory authorities. | Registered exchanges may have multiple active facilities, while a dormant facility has no trading activity. |
If you are involved with a derivatives transaction execution facility that may be classified as dormant, consider reviewing your trading activity and compliance status. You can use US Legal Forms to access templates for necessary filings or documentation. If your situation is complex, seeking professional legal advice may be beneficial.
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The facility may lose its designation, affecting its ability to operate legally.