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Commission
Regulations
Commodity Exchange
Act
Commodity Futures Modernization Act of
2000
Federal Register Notices
Contact: dcio@cftc.gov; (202) 418-5430
Advisories and Other Guidance
FCM and IB Financial Filings
Commodity Pool Annual Reports
Filing CPO and CTA Disclosure Documents
Registered commodity pool operators (CPOs) and commodity trading advisors ( CTAs)
generally must provide prospective participants with a Disclosure Document. These
documents must be filed with the National Futures Association (NFA), which reviews the
documents for compliance with applicable regulations.
CPO and CTA Exclusions and Exemptions
The Commodity Exchange Act (CEA) and
Part
4 of the Commission's regulations contain various provisions that provide
relief from certain registration, disclosure and recordkeeping requirements for
qualifying entities:
Offer or Sale of Foreign Futures and Options to Customers Located in the U.S.
Part
30 of the Commission's rules governs the offer and sale of foreign futures and
options contracts to customers located in the U.S. These rules are designed to carry
out Congress' intent that foreign futures and foreign options products offered or
sold in the U.S. be subject to regulatory safeguards comparable to those applicable to
domestic transactions. The activities that are subject to regulation and require
registration include the solicitation or acceptance of orders for trading any foreign
futures or foreign option contract and acceptance of money, securities or property to
margin, guarantee or secure any foreign futures or foreign option trades or contracts.
As set forth in Rule 30.4, any domestic or foreign person engaged in the activities of
a futures commission merchant (FCM), introducing broker (IB), commodity pool operator
(CPO) or commodity trading advisor (CTA) must register in the appropriate capacity or
seek an exemption from registration under Rule 30.5 or Rule 30.10. Regardless of any
relief from the registration requirement, all persons are subject to the antifraud
provisions of Rule 30.9.
Rule 30.5 provides an exemption from registration for any person located outside of
the U.S. who is required to be registered with the Commission under Part 30, other
than a person required to be registered as an FCM. Rule 30.5 generally requires a firm
seeking an exemption to file a petition for relief with the National Futures
Association. The petitioner must, among other things, provide background and fitness
information, and consent to the jurisdiction of the U.S. courts and the CFTC with
respect to its dealings with U.S. customers. Notwithstanding any relief granted
pursuant to Rule 30.5, all non-U.S. CTAs and CPOs must provide U.S. customers with the
risk disclosures set forth in Rule 30.6.
Rule 30.10 permits a person affected by any of the requirements contained in Part 30
of the Commission's rules to petition the Commission for an exemption from such
requirements. A petition for exemption pursuant to Rule 30.10 is typically filed on
behalf of persons located and doing business outside the U.S. that seek access to U.S
customers by (1) a governmental agency responsible for implementing and enforcing the
foreign regulatory program, or (2) a self-regulatory organization (SRO) of which such
persons are members. If the CFTC determines that compliance with the foreign
jurisdiction's regulatory program would offer comparable protection to persons
located in the U.S. as would be the case if the foreign firm complied with the U.S.
regulatory system, and there is an information-sharing agreement between the
Commission and the firm's home country regulator, the CFTC will issue an order to
the foreign regulator granting general relief, subject to certain conditions.
Individual firms seeking confirmation of that relief must then make certain
representations set forth in the Rule 30.10 order issued to the foreign regulator. For
a more detailed discussion of the Rule 30.10 application process, and the
representations and conditions required therein, please refer to
62 Fed. Reg. 47792 (September
11, 1997) and
Appendix A to Part 30. For a list of foreign government agencies
and SROs that have received CFTC orders under Rule 30.10, please refer to the
Backgrounder titled
"Regulatory and Self-Regulatory Authorities That Have Received Exemptive
Relief Under CFTC Rule 30.10."
Notwithstanding any relief granted pursuant to Rule 30.10, domestic and foreign FCMs
must comply with the secured amount requirement under Rule 30.7. Rule 30.7 requires
FCMs who accept money, securities or property from U.S. customers to maintain in a
separate account or accounts such money, securities and property in an amount at least
sufficient to cover or satisfy all of its current obligations to those customers. For
a more detailed discussion of the Rule 30.7 secured amount requirement, please refer
to Appendix B to Part 30. 65 Fed.
Reg. 60558 (October 11, 2000).
You may obtain more information about the sale of foreign futures and options to U.S.
customers by contacting Commission staff at (202) 418-5430, or by email at
dcio@cftc.gov.
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