Key takeaways:

• On April 18, 2012, the Commodity Futures Trading Commission (the "CFTC") adopted the final rules on commodity options. Prior to the final rules, transactions in options on agricultural commodities were permitted only in very narrow situations outside of such options traded on exchanges, and options on energy commodities were subject to certain restrictions. The final rules will permit commodity options on physical commodities to be transacted in the same manner as all other swaps, options and forwards subject to the CFTC jurisdiction.
• The CFTC will exempt 'trade options' on physical commodities from most of the swap rules. Trade options are options on physical commodities purchased by producers or other commercial users of commodities underlying such options that are intended to be physically settled on a spot or forward basis. Some of the swap rules will continue to apply with respect to trade options, including the reporting requirements and position limits.