Law360, New York (December 14, 2015, 10:38 AM EST) -- The use of derivatives, including futures, options and swaps, is widely accepted as an effective means of managing price risk associated with the production, ownership and merchandising of a wide variety of commodities and financial instruments. With the passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the completion of the bulk of the Title VII implementing regulations by the U.S. Commodity Futures Trading Commission, which oversees the commodity derivatives markets in the U.S., the number of rules and regulations affecting firms using commodity derivatives products has dramatically increased. As a result, market participants in the commodity derivatives markets, whether acting as a commercial hedger, speculator, trading venue, intermediary or adviser, are now subject to a panoply of new and revised regulatory requirements, some of which may not be intuitive. Moreover, to address implementation issues, CFTC staff has issued a series of no-action letters that modify or suspend certain requirements. Now, the CFTC is beginning to assess traders' compliance with the multitude of requirements. Market participants that have not conducted appropriate due diligence and taken necessary steps to comply with all of the rules and related no-action letters are exposed to potential enforcement action that may result in significant monetary and reputational penalties and remedial requirements....