On August 18, 2026, the CFTC published a Notice of Proposed Rulemaking (NPRM) or Proposal seeking public comments to amend registration requirements for commodity pool operators (CPOs) and commodity trading advisors (CTAs).
If adopted, the proposal would allow certain SEC-registered investment advisers (with strategies involving commodity interest investments) to rely on a new CPO registration exemption, provide a related CTA registration exemption, and increase the small pool exemption threshold from $400,000 to $800,000. The proposal is not yet effective.
What Is the CFTC Proposing?
- CFTC Regulation 4.13(a)(4) Exemption or RIA-QEP Exemption. The CFTC rescinded CFTC Regulation 4.13(a)(4) in 2012, as part of the implementation of the Dodd-Frank Act amendments to the Commodity Exchange Act of 1936. The proposed CFTC Regulation 4.13(a)(4) largely codifies CFTC Staff No-Action Letter No. 25-50, with important modifications (please see chart below). Under the Proposal, a CPO would be eligible to claim the exemption from registration if:
- The CPO is also registered with the SEC as an RIA
- The pools operated by the CPO are private funds (i.e., interests in the pool(s) are exempt from registration with the SEC and are not marketed to the public in the United States, provided that the prohibition on public marketing does not apply to a pool that is offered pursuant to Rule 506(c) of Regulation D)
- The CPO reasonably believes that, at the time it claims relief, each pool/fund participant is a QEP as defined under CFTC Regulation 4.7(a)(6). Specifically:
- natural person participants are limited to the categories set out under 4.7(a)(6)(i) (e.g., knowledgeable employees, qualified participants as defined in section 2(a)(51)(A) of the Investment Company Act of 1940, non-U.S. persons, and certain industry professionals)
- non-natural-person participants are limited to all QEPs and accredited investors as defined in Regulation 501(a)(1)-(3), (a)(7), or (a)(8) under the Securities Act
- The CPO files Form PF, if required to do so under the SEC Rules
- A related CTA registration exemption under proposed Rule 4.14(a)(8). An investment adviser that provides commodity interest trading advice solely to CPOs relying on the proposed Rule 4.13(a)(4) exemption could generally be exempt from CTA registration.
- An inflation-adjusted increase to the small pool exemption threshold in Rule 4.13(a)(2), from $400,000 to $800,000 in aggregate gross capital contributions. The proposal would retain the 15-participant limit and the existing exclusions from the capital-contribution calculation.
How Does the Proposed Rule 4.13(a)(4) Differ from CFTC Staff Letter No. 25-50?
| Topic | Letter 25-50 | Proposed Rule 4.13(a)(4) |
|---|---|---|
| Eligible Investors | All pool participants must be QEPs under Rule 4.7(a)(6). | Reverts largely to the former pre-2012 QEP exemption. Natural persons are limited to the categories of QEPs in Rule 4.7(a)(6)(i) (that do not have portfolio requirements, e.g., qualified purchasers, knowledgeable employees, certain industry professionals, non-U.S. persons) while non-natural persons are limited to all QEPs and certain accredited investors. |
| Form PF Requirement | Filing Form PF is an express condition of the no-action relief. | Form PF filing is required if the adviser is required to do so under SEC rules. |
| NFA Filing Framework | Relief required reliance on the staff no-action process and NFA implementation procedures. | Integrated directly into Rule 4.13 for exemption filing procedures, including annual reaffirmations. |
| Rule 4.13(e)(2) Cross-References | Letter expressly waived the redemption-right requirement when a registered CPO deregistered to rely on the relief. | The proposal generally reinstates Rule 4.13(e)(2), including participant redemption rights for pools converting from registered status to exempt status. |
| Treatment of Existing Letter 25-50 Users | Not applicable. | The CFTC states it does not intend to impose redemption rights retroactively on existing Letter 25-50 pools and is considering a delayed effective date for this issue. |
| Delegation Structures (Letter 14-126 / Letter 26-06) | Letter 26-06 provided special relief for Delegating and Designated CPO structures. | The proposal does not expressly codify that relief and suggests it may become unnecessary because both CPOs could qualify for the exemption directly. |
What Should Firms Consider if the NPRM Is Adopted As Is?
- RIA-CPOs seeking to rely on Rule 4.13(a)(4), including advisers currently relying on CFTC Staff Letter No. 25-50, should assess whether natural and non-natural pool participants are QEPs pursuant to CFTC Regulation 4.7(a)(6).
- Offer pool participants the right to redeem their participation interest before the CPO claims the RIA-QEP exemption.
- Disclose to prospective investors that the pool is operated pursuant to the exemption under 4.13(a)(4).
- Plan for exemption administration. The proposal contemplates claiming the exemption through the National Futures Association (NFA) Exemption System, including annual reaffirmations. Firms currently relying on Staff Letter No. 25-50 should compare their current approach with the proposed rule text.
Comment Period
The CFTC will accept comments for 45 days after the proposal is published in the Federal Register. The agency has also requested feedback on implementation issues, including the treatment of existing Letter 25-50 users and certain delegation structures.
Source: CFTC Notice of Proposed Rulemaking
Navigating CFTC Registration Changes
ACA can help your firm assess how evolving CPO and CTA registration requirements may affect your pool structures, investor eligibility, exemption filings, and compliance strategy.
Frequently Asked Questions
Is the CFTC’s proposed CPO and CTA rule currently effective?
No. The CFTC issued a notice of proposed rulemaking, and the changes would not take effect unless and until the agency adopts a final rule.
Who could be affected by proposed Rule 4.13(a)(4)?
Certain SEC-registered investment advisers operating privately offered commodity pools may be eligible, subject to investor eligibility, offering, filing, and other conditions in the proposed rule.
What is changing under the small pool exemption?
The CFTC proposes increasing the aggregate gross capital-contribution threshold under Rule 4.13(a)(2) from $400,000 to $800,000 while retaining the 15-participant limit.
What should firms do now?
The Proposal is a clear indication that the CFTC intends to reduce duplicative registration and compliance obligations for certain RIA-CPOs. Advisers that could be affected by the Proposal may consider submitting comments by October 5, 2026.