On March 11, 2026, the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) entered into a new memorandum of understanding addressing harmonization in areas of common regulatory interest. The memorandum reflects an effort by the agencies to modernize coordination in response to increasingly convergent markets, new trading models, digital asset infrastructure, and automated trading systems.
For the investment management industry, the memorandum is notable because it expressly covers firms with overlapping SEC and CFTC registrations, including firms registered as investment advisers and commodity pool operators and/or commodity trading advisors. It also addresses market structure, pooled investment vehicles, intermediaries, swap and security-based swap markets, reporting, surveillance, examinations, and enforcement.
What the Memorandum Does
In the memorandum, the agencies state that they will, subject to applicable law, “clarify, coordinate, and harmonize policies and practices wherever feasible and relevant.”
More specifically, Article III identifies six focal areas where the agencies intend to build a more seamless framework where their responsibilities intersect, including:
- Clarifying product definitions through joint interpretations and rulemakings.
- Modernizing clearing, margin, and collateral frameworks.
- Reducing frictions for dually registered exchanges, trading venues, and intermediaries.
- Providing a fit-for-purpose regulatory framework for crypto assets and other emerging technologies.
- Streamlining regulatory reporting for trade data, funds, and intermediaries.
- Coordinating cross-market examinations, economic analyses, risk monitoring, surveillance, and enforcement.
The agencies frame these goals around several guiding principles: respect for statutory mandates, regulatory efficiency, good-faith collaboration, regulatory clarity and consistency, and functional and risk-based regulation. The memorandum states that neither agency’s statutory authority or jurisdiction is altered, expanded, or limited and that both agencies remain fully independent.
At the same time, the agencies signal a meaningful effort to “reject a ‘turf war’ mentality,” reduce regulatory gaps, avoid duplicative processes, and provide greater certainty regarding regulatory responsibility.
Key Substantive Provisions
Senior-level coordination and regular consultation
To support implementation, the agencies will establish a senior-level coordination process that may include a formal staff contact at each agency. The memorandum indicates this structure matters because it suggests coordination will not be limited to ad hoc crisis response or isolated referral activity.
Data sharing and analytical coordination
Article IV of the memorandum provides for data sharing, upon request, regarding matters and transactions of common regulatory interest. This includes access to swap data and security-based swap data, as well as shared data analyses and related analytical and monitoring capabilities to improve visibility across swap and security-based swap markets.
The memorandum also states that the agencies will work toward “practical interoperability” where feasible, including compatible data standards and analytical tools to improve detection of market abuse and operational vulnerabilities. They also will endeavor jointly to identify, assess, and prioritize emerging market risks across asset classes, market structures, and intermediaries, and may collaborate on shared analytical tools, modeling approaches, and joint research products.
Advance notice of regulatory developments and market events
The memorandum contemplates advance or ongoing notification, to the extent practicable, when issues may affect the other agency’s regulatory interests, entities, products, or markets under common jurisdiction. The listed matters include:
- Planned rulemakings and general supervisory developments.
- Material events affecting entities, products, or markets.
- Enforcement actions, investigations, or sanctions with cross-jurisdictional impact.
- Proposals to list or trade novel derivative products or novel crypto-asset products.
- Mergers, alliances, cross-shareholdings, or governance changes at commonly regulated entities requiring approval.
- Material changes in areas of common regulatory interest.
For market participants, this provision indicates that novel product activity and significant supervisory or enforcement developments may increasingly be considered through an interagency lens.
Coordinated examinations of dual registrants and other covered firms
One of the memorandum’s most operationally significant features is its examination framework for “Covered Firms.” The agencies state that, to avoid duplicative examinations, they will strive to conduct coordinated exam planning, joint or aligned examinations where appropriate, and share exam findings and supervisory insights.
The memorandum defines “Covered Firms” to include, among others, firms registered both as investment advisers and commodity pool operators and/or commodity trading advisors, as well as dually registered broker-dealers and futures commission merchants and/or introducing brokers. For those firms, the agencies agree to exchange regulatory information about examinations and related information, including examination letters and reports, registration data, risk assessment data, and other information of common regulatory interest.
For investment managers with both SEC and CFTC touchpoints, these provisions could materially affect how exams are sequenced, staffed, and scoped.
Enforcement consultation
The memorandum also addresses enforcement coordination in unusually direct terms. The agencies say they will endeavor to consult on investigations involving potential overlapping jurisdiction in order to promote consistency, efficiency, and proportionality in outcomes while avoiding duplicative relief and conflicting remedial obligations.
More specifically, the agencies contemplate:
- Identifying overlapping matters at the outset as subjects for consultation.
- Conferring about programmatic interests and jurisdictional overlap before a Wells notice or similar instrument is issued.
- Coordinating through designated points of contact when programmatic issues may be relevant to both agencies.
- Where parallel filings are practicable and appropriate, conferring on possible charges, relief, sequencing, litigation strategy, and public communications.
This tracks public statements from SEC leadership that the agencies intend to move away from duplicative enforcement actions and conflicting remedial obligations for the same conduct.
Crypto assets, emerging technologies, and “alternative compliance”
The memorandum repeatedly highlights crypto assets, on-chain systems, and emerging technologies as drivers of regulatory convergence. It identifies a “fit-for-purpose regulatory framework for crypto assets and other emerging technologies” as one of the central harmonization goals. It also states that the agencies will coordinate and cooperate to remove obstacles, where appropriate, to the lawful introduction of novel derivative products, crypto assets, and other products.
In addition, the memorandum states that the agencies will seek to facilitate alternative compliance approaches and enable a path for appropriately tailored and regulated “super-apps,” where that can achieve regulatory objectives more efficiently while preserving investor protection and market integrity.
That language signals an openness to rethinking how existing frameworks apply to converged and multifunctional platforms. In relation to crypto assets, the SEC and CFTC also jointly issued interpretive guidance on March 17, 2026 addressing the application of federal securities laws to certain types of crypto assets.
Confidentiality, use limitations, and legal status
The memorandum contains detailed provisions governing “Non-Public Information,” defined broadly to include information submitted, received, or shared under the memorandum that is not publicly available or otherwise treated as confidential.
The receiving agency is expected to preserve confidentiality. Information may be used to inform examinations, enforcement investigations, proceedings, civil actions, rulemaking, research, market reconstruction, risk analysis, or other jurisdictional activities, although advance notice generally must be given before use in enforcement matters unless that is not feasible.
The agencies also commit not to share such information with self-regulatory organizations without notice and consent, except as required by law.
Implications for Investment Managers
Dually registered advisers are directly in scope
For investment managers, the most immediate implication is that advisers with dual SEC/CFTC footprints are expressly named within the definition of “Covered Firms.” That includes firms registered with the SEC as investment advisers and with the CFTC as commodity pool operators and/or commodity trading advisors, or with the SEC as broker-dealers and with the CFTC as futures commission merchants and/or introducing brokers.
As a result, these firms should expect the possibility of:
- More coordinated exam scheduling and scoping.
- Greater sharing of exam letters, reports, registration data, and risk assessment information between the agencies.
- More aligned supervisory focus on cross-product and cross-market risks.
- Potentially more coordinated treatment of issues that cut across securities and derivatives activities.
For compliance teams, this may make it harder to silo responses by regulator. A deficiency, operational issue, valuation concern, disclosure issue, or derivatives-related control weakness identified in one regulatory context may be more visible to the other agency where common interests are implicated.
Examinations may become more efficient—but potentially more comprehensive
The memorandum is designed in part to minimize burdens on commonly regulated firms, avoid duplicative processes, and create efficiencies in document requests, interviews, and on-site visits. For managers, that may reduce some redundancies associated with responding separately to two regulators on overlapping issues.
But coordination also may increase the overall quality and breadth of regulatory insight brought to an examination. The agencies plan to share risk-assessment data, supervisory findings, and information about emerging risks, and to enhance analytical capabilities across markets and products. In practice, that may mean fewer duplicative requests but more integrated scrutiny of cross-market conduct, derivatives use, fund reporting, and operational risk.
Enforcement risk may become more coordinated rather than duplicative
The enforcement provisions may be welcomed by firms that have faced the prospect of overlapping investigations, inconsistent settlement positions, or duplicative remedies. The agencies expressly say they want to avoid duplicative relief and conflicting remedial obligations.
That said, coordinated enforcement does not necessarily mean lighter enforcement. Because the agencies intend to confer earlier about overlapping jurisdiction, legal theories, charges, relief, and litigation strategy, the practical effect could be more coherent and better-informed parallel scrutiny in matters touching both securities and derivatives regimes. And the memorandum expressly preserves each agency’s independent enforcement authority.
Product development may benefit from earlier interagency coordination
For managers launching products with hybrid features—particularly those involving derivatives, security-based swaps, tokenized instruments, or crypto-related exposures—the memorandum could reduce some uncertainty if it results in earlier alignment between agencies regarding product characterization and regulatory pathways. The joint interpretive guidance is early evidence that the agencies intend to carry out these ideals.
Bottom Line
The new SEC-CFTC memorandum is best understood as a formal effort to move from episodic coordination toward a more structured, operational model of interagency harmonization. It is broad in scope, expressly aimed at reducing duplication and improving clarity, and directly relevant to investment managers and other firms that operate across securities and derivatives regulatory regimes.
For investment managers, the most consequential near-term effects are likely to be in examinations, information sharing, product discussions, and enforcement coordination. The memorandum does not itself change substantive legal obligations or create enforceable rights, but it may materially change how the SEC and CFTC interact with one another—and therefore how they supervise and investigate firms subject to overlapping jurisdiction.
Your Alston & Bird legal team is ready to discuss any implications of the SEC and CFTC’s new memorandum of understanding.
If you have any questions, or would like additional information, please contact one of the attorneys on our Investment Funds team.
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