On April 18, the Division of Clearing and Risk and Division of Market Oversight of the Commodity Futures Trading Commission issued a no-action letter indicating that it will not recommend an enforcement action against a designated contract market (DCM) that allows a market participant to correct a clerical or operational error or omission and resubmit as a new trade a swap transaction that was rejected by a derivatives clearing organization (DCO). In order to rely upon this relief, the following conditions must be met: (i) the original trade must have been rejected due to a clerical or operational error or omission; (ii) the DCM must have rules stating that any trade executed on or pursuant to its rules that is not accepted for clearing shall be void ab initio; (iii) the clearing member(s) involved must agree to submit the new trade; (iv) the clearing member(s) must obtain the consent of its customers to submit the trade; (v) neither the DCM nor a clearing member may require a customer to consent to the submission of a new trade in advance; (vi) the new trade must be submitted as quickly as technologically practicable and, in any event, no later than 30 minutes after it is rejected by a DCO; (vii) both the original trade and the replacement trade must be subject to pre-execution credit checks and processed in accordance with the timeframes set forth in CFTC Regulations 1.74, 23.610 and 39.12(b)(7); (viii) the DCM must report the swap transaction data to a swap data repository; and (ix) the procedures established by the DCM do not impair impartial access. The no-action relief expires on June 30, 2014. 

The no-action letter is available here.