New rules would have called for FX prime brokers to submit pre-trade mid-market quote and risk disclosures.
Courtesy of our friends at CFTCLaw.com… The CFTC has apparently given last-minute relief from its new client disclosure rules (which came into effect on May 1) to FX Prime Brokers, after listening to complaints that the market could be threatened by new business conduct rules.
According to CFTCLaw.com, the new rules would have called for FX Prime Brokers to submit specific information to clients, such as a pre-trade mid-market quote and risk disclosures. The problem with this is hedge funds generally negotiate trades with an executing dealer before they give up the trade to a Prime Broker to finalize the deal. The prime broker would not be able to meet the requirements because it only finds about the deal after it occurs.
For more details see the full post on the CFTCLaw.com website.
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