CFTC

On May 28, the Biden-Harris Administration issued the Voluntary Carbon Markets Joint Policy Statement and Principles (Policy Statement).  You can find Covington’s analysis of the Policy Statement here.  Jointly announced by the U.S. Secretaries of Treasury, Agriculture, and Energy, and senior White House climate officials, the Policy Statement describes a three-pronged approach to responsible carbon market development and participation: (1) credit or supply integrity, including protections regarding climate and environmental justice; (2) demand integrity, to ensure the credible use of credits; and (3) market-level integrity, including facilitating efficient market participation and lowering transaction costs.  The Policy Statement builds on other recent federal actions, including the Commodities Futures Trading Commission’s 2023 proposed guidance for voluntary carbon credit derivatives and the Securities and Exchange Commission’s final climate risk disclosure rule, which requires certain disclosures related to carbon offset purchases, in the Administration’s attention to and elevation of the voluntary carbon market as an important element in the nation’s climate policy. 

In this post, we dive deeper into the voluntary carbon market landscape, implications for business, and additional recent developments. Continue Reading Engaging in Voluntary Carbon Markets: Overview of Key Developments, Risks, and Opportunities

On September 13, 2016 the Financial CHOICE Act was approved by the House Financial Services Committee by a vote of 30-26.  The bill would overhaul regulation of the financial markets and is an important development for derivatives market participants, including energy companies.  For example, the bill would alter the functioning of the Commodity Futures Trading Commission (“CFTC”), by:

  • Requiring development of procedures governing no-action and other exemptive relief, including a requirement that the commissioners have the opportunity to review any responses to a request for relief.
  • Require notice-and-comment before issuance of policy statements, guidance, interpretive rules, or other procedural rules.
  • Allowing for judicial review of CFTC rules, along the lines of that allowed for Securities and Exchange Commission (“SEC”) rules.

Continue Reading “Financial CHOICE Act” Approved by House Financial Services Committee

Chairman Timothy Massad and Commissioner J. Christopher Giancarlo of the Commodity Futures Trading Commission (the “CFTC”) delivered speeches at the Energy Risk Summit in Houston this week, providing a roadmap for the CFTC’s current and upcoming rulemaking as well as a policy perspective on the CFTC’s proposed position limit rules.

In remarks to the conference

The Commodity Futures Trading Commission’s (CFTC) proposed rule on position limits continues to be a priority for energy market participants, as both Congress and the CFTC are actively reviewing this issue.  The final rule threatens well-established hedging and risk management practices related to the trading of futures and swaps by energy market participants.

Recently, the