With the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) having agreed upon the definition of a swap, all that’s left is for the final rule to be published in the U.S. Federal Register—which is anticipated within the next few weeks—before the 60-day countdown to CFTC registration begins for commodity pool operators (CPOs).

This could result in the registration deadline being as early as September 30.

“The industry now has deadlines to work towards, and this approval will help remove the uncertainty and ambiguity of discussing potential regulatory scenarios,” said Jeffrey Wallis, managing partner at SunGard Global Services, a trading and technology company.

In April, the CFTC rescinded Rule 4.13(a)(4) of the Commodity Exchange Act, under which CPOs were exempt from registration if all investors in the CPO’s fund are “qualified eligible persons”, or sophisticated investors.

“Funds that relied upon the 4.13(a)(4) exemption have until December 31 to decide whether to register with the CFTC,” said Donald Babbitt, a consultant at Kinetic Partners.

That decision, in turn, is dependent on the swaps definition rule, which will become effective 60 days after the final rule is printed in the Federal Register.

Fund managers that are not currently exempt from CFTC registration will need to analyze immediately which entities need to register, which individuals will need to be fingerprinted and to take the Series 3 or Series 32 exam, to ensure any offering documents are CFTC compliant and have been approved by the National Futures Association, the independent self-regulatory watchdog, and to put in place a robust CFTC compliance infrastructure before the 60 days are up.

“Given the release of the definition of swap, these managers should begin now to analyze their options,” said Babbitt.

The CFTC left in place the exemption available under Rule 4.13(a)(3) for CPOs engaged in a ‘de minimis’ level of futures trading (no more than 5% of the liquidation value of the fund’s portfolio is used to establish futures trading positions or the aggregate net notional value of such positions does not exceed 100% of the liquidation value of the fund’s portfolio).

Although the CFTC had initially proposed rescinding both Rules 4.13(a)(3) and 4.13(a)(4), following the comment period the CFTC decided to keep the 4.13(a)(3) exemption for entities engaged in a de minimis amount of futures trading.

The swaps rule will help swap dealers and other industry participants begin the process of implementation.

“Many of our clients have been waiting for concrete clarity on what and how compliance will be defined as a result of Title VII,” said Wallis of SunGard. “While the commission has gone a long ways towards that end, there continues to exist a tremendous amount of work to understand the details of the approved language and its impact to our client’s daily business, technology and operations.”