[Federal Register: September 8, 2003 (Volume 68, Number 173)]
[Rules and Regulations]
[Page 52836-52837]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr08se03-5]
=======================================================================
-----------------------------------------------------------------------
COMMODITY FUTURES TRADING COMMISSION
17 CFR Part 4
RIN 3038-AB97
Additional Registration and Other Regulatory Relief for Commodity
Pool Operators and Commodity Trading Advisors; Past Performance Issues;
Correction
AGENCY: Commodity Futures Trading Commission.
ACTION: Final rules; correction.
-----------------------------------------------------------------------
SUMMARY: The Commodity Futures Trading Commission (Commission)
published in the Federal Register of August 8, 2003, a document
providing additional relief for certain persons excluded from the
commodity pool operator (CPO) definition, providing
[[Page 52837]]
exemptions from registration as a CPO or commodity trading advisor
(CTA), and facilitating communications by CPOs and CTAs (Final Rules).
This document contains corrections to the final rules.
DATES: Effective September 8, 2003.
FOR FURTHER INFORMATION CONTACT: Barbara S. Gold, Associate Director,
or Christopher W. Cummings, Special Counsel, Division of Clearing and
Intermediary Oversight, Commodity Futures Trading Commission, 1155 21st
Street, NW., Washington, DC 20581, telephone numbers: (202) 418-5450 or
(202) 418-5445, respectively; facsimile number: (202) 418-5528; and
electronic mail: bgold@cftc.gov or ccummings@cftc.gov, respectively.
SUPPLEMENTARY INFORMATION: The Commission published the Final Rules in
the Federal Register of August 8, 2003 (68 FR 47221). The Final Rules
affect CPOs and CTAs and persons excluded or exempted from registering
as such. As published, however, the Final Rules contain errors that may
be misleading and need clarification. In addition to correcting
typographical errors and clarifying certain rules referenced in
Appendix A, as is discussed below, the Commission is clarifying the
right of redemption of a pool participant and the right of termination
of a CTA client.
Rules 4.13(b)(2) and 4.14(a)(8)(iii)(B), respectively, address the
situation where a CPO qualifies for exemption from registration in
connection with all of the pools it operates or a CTA qualifies for
exemption from registration in connection with providing advice to all
of its clients. In such a situation, these rules provide that where a
registered CPO or CTA intends to claim the exemption and to withdraw
from registration, the CPO or CTA must, among other things, provide
pool participants or advisory clients with a right of redemption or
right of termination, as the case may be.
Rules 4.13(e)(2) and 4.14(c)(2), respectively, address the
situation where a registered CPO qualifies for exemption from
registration in connection with some of the pools it operates or a
registered CTA qualifies for exemption from registration in connection
with providing advice to some of the clients it advises. In such a
situation, these rules provide that the CPO or CTA may treat the pools
or clients for which it would otherwise qualify for exemption from
registration as if it were in fact exempt from registration.
The Commission is clarifying that where a CPO or CTA seeks relief,
all pool participants and clients have the same right to redemption or
termination regardless of whether their CPO or CTA (1) intends to
withdraw from registration (the first situation discussed above), or
(2) remains registered and treats them as if the CPO or CTA had in fact
withdrawn from registration (the second situation discussed above).
Thus, the Commission is clarifying that, regardless of registration
status, the obligations of the CPO or CTA to pool participants or
clients are the same in this context.
0
In rule FR Doc. 03-20094 published on August 8, 2003, 68 FR 47221, make
the following corrections:
0
1. On page 47233, in the first column, in Sec. 4.13(e)(2)(i)(B), in
the third line, delete the word ``and'' and in paragraph (e)(2)(ii), in
the second line, delete ``.'' and insert ``; and'' and add new
paragraph (e)(2)(iii) to read as follows:
Sec. 4.13 Exemption from registration as a commodity pool operator.
* * * * *
(e) * * *
(2) * * *
(iii) Provides to each existing participant in a pool that the
person elects to operate as described in paragraph (a)(3) or (a)(4) of
this section a right to redeem the participant's interest in the pool,
and informs each such participant of that right no later than the time
the person commences to operate the pool as described in paragraph
(a)(3) or (a)(4) of this section.
* * * * *
Sec. 4.14 [Corrected]
0
2. On the same page, in the third column, in Sec.
4.14(a)(8)(iii)(A)(2), in the third and fourth lines, ``(i.e., Sec.
4.14(a)(8)(i) or (a)(8)(ii), or both (a)(8)(i) and (a)(8)(ii))'' is
corrected to read ``(i.e., under Sec. 4.14(a)(8)(i))''.
0
3. On page 47234, in the third column in paragraph (c)(2), in the
eleventh line, before the period, insert the following text: ``;
Provided Further, That the person provides to each existing client
described in paragraph (a) of this section a right to terminate its
advisory agreement, and informs such client of that right no later than
the time the person commences to provide commodity interest trading
advice to the client as if the person was exempt from registration''.
Sec. 4.22 [Corrected]
0
4. On page 47235, in the first column, in Sec. 4.22(c), in the ninth
line, the word ``on'' is corrected to read ``of''.
0
5. On the same page, in the second column, paragraph (j) introductory
text is redesignated as (j)(1), paragraphs (j)(A) and (B) are
redesignated as (j)(1)(i) and (ii) respectively, and paragraph (j)(ii)
is redesignated as paragraph (j)(2).
Appendix A to Part 4--[Corrected]
0
6. On page 47236, in the second column, in the first paragraph
``Application,'' in the last line, ``Rule 4.13(a)(3)'' is corrected to
read ``Rule 4.13(a)(3)(ii)(A).''
0
7. On the same page, in the second column, in paragraph ``3.
Situation,'' in the seventh line, and in the next paragraph
``Application,'' in the last line, ``Rule 4.13(a)(3)(i)(A)'' is
corrected to read ``Rule 4.13(a)(3)(ii)(A)'' in each instance.
0
8. On the same page, in the third column, in the paragraph
``Application,'' in the fifth line and in the seventh line, ``Rule
4.13(a)(3)(i)'' is corrected to read ``Rule 4.13(a)(3)(ii)'' in each
instance.
Issued in Washington, DC, on September 2, 2003 by the
Commission.
Jean A. Webb,
Secretary of the Commission.
[FR Doc. 03-22755 Filed 9-5-03; 8:45 am]
BILLING CODE 6351-01-P