[Federal Register: October 26, 2007 (Volume 72, Number 207)]
[Rules and Regulations]
[Page 60767-60771]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr26oc07-7]
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COMMODITY FUTURES TRADING COMMISSION
17 CFR Part 18
RIN 3038-AC22
Maintenance of Books, Records and Reports by Traders
AGENCY: Commodity Futures Trading Commission.
ACTION: Final rule.
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SUMMARY: The Commodity Futures Trading Commission (Commission) is
amending Commission Regulation 18.05 in two respects: to make it
explicit that persons holding or controlling reportable positions on a
designated contract market (DCM) or derivatives transaction execution
facility (DTEF) must retain books and records and make available to the
Commission upon request any pertinent information with respect to all
other positions and transactions in the commodity in which the trader
has a reportable position, including positions held or controlled or
transactions executed on all reporting markets, over-the-counter (OTC)
and/or pursuant to Sections 2(d), 2(g) or 2(h)(1)-(2) of the Commodity
Exchange Act (Act) or Part 35 of the Commission's regulations, on
exempt commercial markets operating pursuant to Sections 2(h)(3)-(5) of
the Act (ECMs), on exempt boards of trade operating pursuant to Section
5d of the Act (EBOTs), and on foreign boards of trade (FBOTs); and to
make the regulation clearer and more complete with respect to hedging
activity. The amendments will enhance the Commission's ability to deter
and prevent price manipulation or any other disruptions to the
integrity of the regulated futures markets, help to ensure the
avoidance of systemic risk, and clarify the meaning of the regulation.
DATES: Effective Date: November 26, 2007.
FOR FURTHER INFORMATION CONTACT: Duane C. Andresen, Special Counsel,
Division of Market Oversight, Commodity Futures Trading Commission,
Three Lafayette Centre, 1155 21st Street, NW., Washington, DC 20581.
Telephone 202-418-5492; e-mail dandresen@cftc.gov.
SUPPLEMENTARY INFORMATION:
I. Purpose of Regulation 18.05 and Statutory Basis
Section 3(b) of the Act \1\ declares that the purpose of the Act is
to, among
[[Page 60768]]
other things, deter and prevent price manipulation or any other
disruptions to market integrity and to ensure the financial integrity
of all transactions subject to the Act and the avoidance of systemic
risk. Section 4i of the Act \2\ requires persons holding futures or
option positions at DCMs or DTEFs at or above certain levels to keep
books and records of all:
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\1\ 7 U.S.C. Sec. 5(b) (2007). Sec. 3(b) of the Act provides
in full:
It is the purpose of this chapter to serve the public interests
described in subsection (a) of this section through a system of
effective self-regulation of trading facilities, clearing systems,
market participants and market professionals under the oversight of
the Commission. To foster these public interests, it is further the
purpose of this chapter to deter and prevent price manipulation or
any other disruptions to market integrity; to ensure the financial
integrity of all transactions subject to this chapter and the
avoidance of systemic risk; to protect all market participants from
fraudulent or other abusive sales practices and misuses of customer
assets; and to promote responsible innovation and fair competition
among boards of trade, other markets and market participants.
\2\ 7 U.S.C.Sec. 6i (2007). Sec. 4i of the Act provides:
It shall be unlawful for any person to make any contract for the
purchase or sale of any commodity for future delivery on or subject
to the rules of any contract market or derivatives transaction
execution facility--
(1) if such person shall directly or indirectly make such
contracts with respect to any commodity or any future of such
commodity during any one day in an amount equal to or in excess of
such amount as shall be fixed from time to time by the Commission,
and
(2) if such person shall directly or indirectly have or obtain a
long or short position in any commodity or any future of such
commodity equal to or in excess of such amount as shall be fixed
from time to time by the Commission, unless such person files or
causes to be filed with the properly designated officer of the
Commission such reports regarding any transactions or positions
described in clauses (1) and (2) hereof as the Commission may by
rule or regulation require and unless, in accordance with rules and
regulations of the Commission, such person shall keep books and
records of all such transactions and positions and transactions and
positions in any such commodity traded on or subject to the rules of
any other board of trade, and of cash or spot transactions in, and
inventories and purchase and sale commitments of such commodity.
Such books and records shall show complete details concerning all
such transactions, positions, inventories, and commitments,
including the names and addresses of all persons having any interest
therein, and shall be open at all times to inspection by any
representative of the Commission or the Department of Justice. For
the purposes of this section, the futures and cash or spot
transactions and positions of any person shall include such
transactions and positions of any persons directly or indirectly
controlled by such person.
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(1) Transactions and positions in the exchange-traded commodity;
(2) Transactions and positions in any such commodity traded on or
subject to the rules of any other board of trade; and
(3) Cash or spot transactions in, and inventories and purchase and
sale commitments of such commodity.
Such books and records must be open at all times for inspection by
any representative of the Commission or the Department of Justice.
Section 8a(5) of the Act \3\ provides explicit authority to the
Commission to make and promulgate such rules and regulations as, in the
judgment of the Commission, are reasonably necessary to effectuate any
of the provisions or to accomplish any of the purposes of the Act. In
order to accomplish the purposes of Sections 3(b) and 4i set forth
above, the Commission has promulgated regulations creating market and
large trader reporting requirements.\4\ Included among these
regulations is a requirement that persons holding futures or option
positions at DCMs or DTEFs (reporting markets) \5\ at or above
reportable levels (reportable positions) \6\ be identified to the
Commission through the large trader reporting system (LTRS).
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\3\ 7 U.S.C. 12a(5) (2007).
\4\ The Commission's market and large trader reporting rules are
contained in Parts 15 through 21 of the Commission's regulations.
\5\ Pursuant to Commission Regulation 15.00(m), a reporting
market means a DCM and, unless determined otherwise by the
Commission with respect to the facility or a specific contract
listed by the facility, a DTEF.
\6\ Pursuant to Commission Regulation 15.00(l), reportable
position means:
(1) For reports specified in parts 17, 18 and Sec. 19.00(a)(2)
and (a)(3) of this chapter any open contract position that at the
close of the market on any business day equals or exceeds the
quantity specified in Sec. 15.03 of this part in either:
(i) Any one future of any commodity on any one reporting market,
excluding future contracts against which notices of delivery have
been stopped by a trader or issued by the clearing organization of a
reporting market; or
(ii) Long or short put or call options that exercise into the
same future of any commodity, or long or short put or call options
for options on physicals that have identical expirations and
exercise into the same physical, on any one reporting market.
(2) For the purposes of reports specified in Sec. 19.00(a)(1)
of this chapter, any combined futures and futures-equivalent option
open contract position as defined in part 150 of this chapter in any
one month or in all months combined, either net long or net short in
any commodity on any one reporting market, excluding futures
positions against which notices of delivery have been stopped by a
trader or issued by the clearing organization of a reporting market,
which at the close of the market on the last business day of the
week exceeds the net quantity limit in spot, single or in all-months
fixed in Sec. 150.2 of this chapter for the particular commodity
and reporting market.
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The LTRS, which requires that clearing members, futures commission
merchants (FCM) and foreign brokers file daily reports with the
Commission, enables the Commission to assess an individual trader's
activities and potential market power and to enforce the Commission or
DCM-set limits on speculative positions.\7\ Once a trader holds a
reportable position, the trader is subject to Commission Regulation
18.05,\8\ which requires that the trader keep books and records showing
all details concerning:
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\7\ The Commission also uses large trader reporting information
as a means to ensure the avoidance of systemic risk in that such
information enables Commission staff to determine which FCMs
carrying accounts might have exposure in particular markets.
\8\ Regulation 18.05 states in full:
Every trader who holds or controls a reportable futures or
option position shall keep books and records showing all details
concerning all positions and transactions for future delivery in the
commodity on all reporting markets, all positions and transactions
in the commodity option, and all positions and transactions in the
cash commodity, its products and byproducts and, in addition,
commercial activities that the trader hedges in the commodity
underlying the futures contract in which the trader is reportable,
and shall upon request furnish to the Commission any pertinent
information concerning such positions, transactions or activities.
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(1) All positions and transactions for future delivery in the
commodity on all reporting markets;
(2) All positions and transactions in the commodity option;
(3) All positions and transactions in the cash commodity, its
products and byproducts; and
(4) Commercial activities that the trader hedges in the commodity
underlying the futures contract in which the trader is reportable.\9\
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\9\ In describing the requirements of Regulation 18.05 in 1981,
the Commission stated:
The regulation requires reportable traders to maintain books and
records of futures positions and transactions in the commodity in
which they are reportable and all positions and transactions in the
cash commodity and its products and byproducts * * *. [T]he
Commission wishes to underscore its view that the book and
recordkeeping requirements and inspection provision contained
therein are essential to accomplish the purposes of the Act and
within the Commission's authority to adopt pursuant to section[s] 4i
and 8a(5) of the Act. These requirements have always applied to the
traders who hold or control a reportable position, and have not been
restricted in any way. ``Reporting Requirements for Contract
Markets, Futures Commission Merchants, Members of Exchanges and
Large Traders,'' 46 FR 59960, 59963 (December 8, 1981) (footnote
omitted).
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A reportable trader is required to furnish to the Commission, upon
request, any pertinent information concerning these positions,
transactions or activities. \10\ Traders who do not hold reportable
positions do not have obligations under Regulation 18.05.
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\10\ The Commission currently requests such information an
average of three times per year.
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II. Proposal
A. Introduction
In order to enhance its ability to detect and prevent manipulation
of regulated markets and products and to ensure the avoidance of
systemic risk, as well as to clarify the meaning of the regulation and
bring it up to date, the Commission published in the Federal Register a
proposal to amend Regulation 18.05 in the following respects: \11\
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\11\ 72 FR 34413 (June 22, 2007).
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1. To make it explicit that persons holding or controlling
reportable positions on a reporting market must retain books and
records and make available to the Commission upon request pertinent
information with respect to all non-reporting transactions, i.e., all
positions and transactions in the commodity in which the trader is
reportable, including transactions
[[Page 60769]]
executed on all reporting markets, OTC and/or pursuant to Sections
2(d), 2(g) or 2(h)(1)-(2) of the Act or Part 35 of the Commission's
regulations, on ECMs operating pursuant to Sections 2(h)(3)-(5) of the
Act, on EBOTs operating pursuant to Section 5d of the Act, and on
FBOTs; and
2. To make the regulation clearer and more complete with respect to
hedging activity.
B. Proposed Amendments Related to Recordkeeping and Reporting
The proposal recognized that there is a close relationship among
transactions conducted on reporting markets and non-reporting
transactions and that it is sometimes necessary to determine all
transactions and positions in the commodity in which the trader is
reportable in order to more effectively detect and prevent manipulation
of regulated markets and products and to ensure the avoidance of
systemic risk.\12\ The Commission recognized that it is particularly
important that staff be able to assess the reportable trader's overall
position in the same commodity in light of the growing volume of
trading on the non-reporting markets, the close relationship among the
various products and markets, the increasing globalization of the
futures markets, and the growth of trading on FBOTs.\13\
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\12\ See sections 6(c), 6c, 6(d) and 9(a)(2) of the Act for the
Commission's antimanipulation authority.
\13\ For instance, since 1999, Commission staff, through foreign
terminal no-action letters, has allowed 19 FBOTs to make their
trading systems available by direct access to members and other
participants in the U.S. without requiring the FBOTs to register as
DCMs or DTEFs.
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The proposal noted that while Regulation 18.05 explicitly requires
that a trader holding reportable positions keep books and records and
provide to the Commission, upon request, pertinent information with
respect to positions and transactions in the underlying commodity on
DCMs and DTEFs, it does not explicitly do so with respect to positions
and transactions in virtually identical contracts executed on ECMs,
EBOTs or FBOTs or in the same commodity executed OTC and/or pursuant to
Sections 2(d), 2(g) or 2(h)(1)-(2) of the Act or Part 35 of the
Commission's regulations. The Commission noted that information
concerning non-reporting transactions is important to its ability to
conduct effective market surveillance of the DCM and DTEF contracts.
Thus, if a trader is reportable because of futures or option positions
in a contract on a DCM or DTEF, the trader's books and records with
respect to non-reporting positions and transactions in the same
commodity are relevant to effective surveillance and supervision of the
DCM or DTEF contract in which the trader is reportable.
The proposal noted that the Act provides ample authority to require
keeping books and records and providing pertinent information
concerning non-reporting transactions. Section 4i explicitly
encompasses non-reporting transactions on ``any other board of trade''
(such as FBOTs, ECMs operating pursuant to Sections 2(h)(3)-(5) of the
Act, and EBOTs operating pursuant to Section 5d of the Act) and in the
form of cash or spot transactions, inventories, and purchase and sale
commitments. Further, Section 3(b) of the Act declares that the purpose
of the Act is to, among other things, deter and prevent price
manipulation or any other disruptions to market integrity and to ensure
the avoidance of systemic risk. Section 8a(5) of the Act authorizes the
Commission to promulgate such regulations as, in its judgment, are
reasonably necessary to accomplish any of the purposes of the Act. As
noted in the proposal, amending Regulation 18.05 to clearly require
that reportable traders keep books and records showing all details
concerning non-reporting transactions in the reportable commodity is a
reasonably necessary means of accomplishing the purposes of Section
3(b) of the Act.
The proposal also noted that although non-reporting transactions
themselves generally are not subject to most regulatory provisions of
the Act, the futures or option transactions executed and maintained on
a DCM or DTEF that result in a reportable position are subject to such
provisions and, pursuant to Section 3(a) of the Act, are affected with
a national public interest. It is the purpose of the Act pursuant to
Section 3(b) that the Commission deter and prevent price manipulation
of all commodities traded on these regulated markets. The proposal
stated that to accomplish this purpose, it is necessary that the
Commission have the ability to review all activities in commodities
traded on these markets, regardless of where the transactions are
executed. By taking a position on a regulated market, a trader agrees
to abide by the rules of the market and the Commission, including
prohibitions against manipulation. To enhance its ability to detect and
deter manipulation and other threats to market integrity, the
Commission requires persons holding reportable positions to maintain
books and records of transactions that could impact the regulated
market and related cash market, including non-reporting transactions.
Finally, the proposal noted that staff has interpreted Regulation
18.05 to include position and transaction data for non-reporting
transactions and has received such information in response to requests
made pursuant to the Regulation. Thus, consistent with the Act and
Commission practice, the Commission proposed to amend Regulation 18.05
to make explicit that a trader with a reportable position must keep
books and records showing all details concerning all non-reporting
transactions in the same commodity and provide pertinent information to
the Commission upon request.
C. Amendments Related to Clarity and Completeness
The proposal also noted that there are two issues that arise in
connection with the Regulation 18.05 requirement that traders keep
books and records showing all details concerning ``commercial
activities that the trader hedges in the commodity underlying the
futures contract in which the trader is reportable.'' First, the phrase
has led to some confusion. Originally inserted into the paragraph as
``commercial activities that the trader hedges in the futures commodity
in which the trader is reportable,'' its purpose was to require that,
``in addition to books and records of positions or transactions in a
cash commodity, a reportable trader must also maintain records of
commercial activities which the trader hedges.'' \14\ Second, the
proposal stated that reportable positions can be option positions, as
well as futures positions, but it is not clear that the current
language also addresses commercial activities that the trader hedges in
the commodity underlying any option contract in which the trader is
reportable.
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\14\ 46 FR 42463, 42466 (August 21, 1981).
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The Commission therefore proposed to amend the regulation to revert
to the original approach and include hedges in the option contract in
which the trader is reportable. By modifying the phrase to read
``commercial activities that the trader hedges in the futures or option
contract in which the trader is reportable,'' Regulation 18.05 captures
information with respect to hedges in other than the cash commodity,
its products or byproducts (i.e., a trader with a reportable position
in gold futures or options that is a hedge of a cash position in silver
would be required to comply with the Regulation 18.05 requirements with
respect to the silver position).
[[Page 60770]]
III. Comments Regarding the Proposal
The Commission received six comment letters on its proposal.
Commenters included the American Public Gas Association (APGA), the
Industrial Energy Consumers of America (IECA), the International Swaps
and Derivatives Association, Inc. (ISDA), the Managed Funds Association
(MFA), the New York Public Service Commission (NYPSC), and the New York
Mercantile Exchange (NYMEX). Most of the commenters generally endorsed
the proposal and/or its underlying purpose, but felt that additional
steps are necessary to resolve the underlying matters that the proposal
is intended to address. Two commenters raised concerns regarding the
recordkeeping and reporting aspects of the proposal.
The APGA commented that it strongly supports the proposed amendment
but is concerned about the economic links between NYMEX and OTC
contracts and believes that further steps are necessary for the
Commission to carry out surveillance of the natural gas markets. It
expressed concern that the LTRS does not routinely reach traders' large
OTC positions and noted that it has petitioned Congress to provide the
Commission with authority for a LTRS with respect to trading in
financial contracts in natural gas. Further, the APGA commented that
reliance on special call authority leaves open the potential for
manipulation or other disruptive behavior with little risk of detection
until after damage to the market has been done.
The IECA commented that it supports the proposal but noted that
requiring companies to keep books and records does not prevent market
manipulation and that preemptive monitoring of entities with large
positions that cover both futures and OTC markets is necessary.
Further, such entities should be required to report daily to the
Commission. The IECA also recommended that the Commission support the
establishment of an advisory panel on energy markets with consumer
participation thereon.
The NYPSC noted that it supports the proposed rule and its
underlying purpose and that given the increases in natural gas prices
over the past several years, the relevant government entities must take
all available steps to prevent market manipulation and ensure the
integrity of the natural gas markets. The NYPSC maintained that it is
essential to evaluate exposure on both NYMEX and the InterContinental
Exchange (ICE), an ECM, and stated that the Commission's inability to
directly regulate traders that use ICE exclusively creates a serious
loophole in effective regulatory oversight of the financial markets.
Concerned that traders will avoid regulatory oversight by trading
exclusively on ICE, the NYPSC recommended that the Commission should
monitor the migration of traders that currently utilize NYMEX to ICE as
the exclusive means of trading natural gas contracts.
The ISDA and the MFA voiced support for the proposal but raised
concerns about the proposal's recordkeeping and reporting obligations.
The ISDA stated its view that the proposal does not create additional
recordkeeping or reporting obligations and requested clarification with
respect to the scope of Regulation 1.35(a), which contains
recordkeeping and reporting language similar to that in proposed
Regulation 18.05. Further, the ISDA requested clarification that the
records required to be retained under proposed Regulation 18.05 are
subject to Regulation 1.31 retention requirements and consist of
accurate records of positions and actual transaction documentation
created in the ordinary course of business. The MFA requested that the
Commission confirm that the current system of books and records
maintained by traders in the normal course of business and in the
format created in the normal course of business would meet the
proposal's recordkeeping and retention requirements.
The NYMEX voiced support for the intention underlying the proposal
but commented that the purpose of the proposal can be met only by
imposing identical requirements on linked trading facilities meeting
specified criteria. NYMEX posited that the proposal, if implemented,
would create an incentive for market participants to do all their
trading at unregulated or non-transparent venues or to trade at a level
below the reportable level on the regulated exchange. Further, NYMEX
commented that the proposal was limited in effectiveness because of the
anticipated infrequent use of the special call procedure; would impose
a cost on the regulated exchanges because of the shift in trading
activity; and would have adverse public policy consequences. NYMEX
recommended that the Commission defer the amendments to Regulation
18.05 in favor of a more comprehensive legislative approach that would
result in the implementation of reporting requirements on organized
trading facilities that have triggered specified criteria.\15\
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\15\ As noted above, other commenters also recommended
legislation action, i.e., to provide the Commission with authority
for a LTRS with respect to trading in financial contracts in natural
gas on non-reporting markets and to require entities that control
large positions in the OTC market to report daily to the Commission.
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The Commission has carefully considered the comments submitted and
has decided, for reasons cited herein and in the proposal, to amend the
regulation as proposed. As previously stated, staff has interpreted
Regulation 18.05 to include position and transaction data for non-
reporting transactions and has received such information in response to
requests made pursuant to the Regulation. Thus, the proposal to amend
Regulation 18.05 merely makes explicit what has been implicit.
NYMEX's comment that the proposal would lead market participants to
move their trading activity to unregulated or non-transparent venues,
or trade at a level below the reportable level on the regulated
exchange in order to avoid the consequences of holding reportable
positions, is highly speculative and, in the Commission's estimation,
unlikely. As previously discussed, the amendments to Regulation 18.05
clarify existing authority and, accordingly, any ``disincentive'' for
traders to trade on a regulated market already exists, with or without
the amendments. In addition, the Commission sees little merit in
following NYMEX's suggestion to defer in favor of a legislative
approach. The Commission can control neither the timing nor the terms
of legislation addressing reporting obligations on currently non-
reporting markets, or even whether such legislation is enacted in the
first instance. Should legislation in this area be enacted which
expands the Commission's jurisdiction with respect to transactions that
are currently non-reportable, further amendments to the regulation
could be considered.
With respect to the comments regarding the proposal's recordkeeping
and reporting obligations, the Commission confirms that the amendments
should not change current recordkeeping or reporting obligations,
assuming that traders are currently keeping complete transaction
records. Records required to be retained under Regulation 18.05 consist
of accurate records of positions and actual transaction documentation
created in the ordinary course of business. Thus, books and records
that currently should be maintained by traders in the normal course of
business and in the format created in the normal course of business
would meet the regulation's recordkeeping requirements. Such records
are subject to the Regulation 1.31 retention requirements. Finally,
[[Page 60771]]
Regulation 18.05 does not alter or add to the Regulation 1.35(a)
recordkeeping and reporting requirements.
IV. Related Matters
A. Cost Benefit Analysis
Section 15(a) of the Act requires the Commission to consider the
costs and benefits of its action before issuing a new regulation or
order under the Act. By its terms, Section 15(a) does not require the
Commission to quantify the costs and benefits of a new regulation or to
determine whether the benefits of the regulation outweigh its costs.
Rather, Section 15(a) simply requires the Commission to ``consider the
costs and benefits'' of its action.
Section 15(a) further specifies that the costs and benefits of the
rule or order shall be evaluated in light of five broad areas of market
and public concern: (1) Protection of market participants and the
public; (2) efficiency, competitiveness, and financial integrity of
futures markets; (3) price discovery; (4) sound risk management
practices; and (5) other public interest considerations. The Commission
may, in its discretion, give greater weight to any one of the five
enumerated areas of concern and may, in its discretion, determine that,
notwithstanding its costs, a particular rule or order is necessary or
appropriate to protect the public interest or to effectuate any of the
provisions or to accomplish any of the purposes of the Act.
The Commission's proposal contained an analysis of its
consideration of these costs and benefits and solicited public comment
thereon. As previously noted, NYMEX commented that the proposal, by
adding another incentive for market participants to shift their trading
activity from regulated and transparent venues to unregulated and non-
transparent venues, would impose a cost on the regulated exchanges and
would have adverse public policy consequences. NYMEX also questioned
the extent of the benefits to be obtained from the proposal in light of
the acknowledgement that special calls for information would continue
to be made on an infrequent basis.
The Commission believes, as it stated in the discussion of NYMEX's
comments above, that attempting to discern what impact amended
Regulation 18.05 will have on potential large traders, or what costs to
the regulated exchanges would be associated with any shift in trading
activity, is highly speculative. Because the amendments clarify
existing authority, any ``disincentive'' for traders to trade on a
regulated market already exists, with or without the amendments.
Additionally, the Commission finds no merit in the contention that the
extent of the benefits to be obtained from the amendments are
questionable in light of the acknowledgement that special calls for
information would continue to be made on an infrequent basis. The
Commission is confident that such special calls will be made when
deemed necessary and that the information provided in response to such
special calls will assist the Commission in meeting its regulatory
responsibilities.
After consideration of the costs and benefits and the public
comments received thereon, the Commission has determined to adopt the
amendments to Regulation 18.05 set forth below.
B. The Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA), 5 U.S.C. 601 et seq.,
requires that agencies consider the impact of their rules on small
businesses. The Commission has previously determined that exchanges,
futures commission merchants and large traders are not ``small
entities'' for the purposes of the RFA.\16\ The requirements related to
the amended recordkeeping and reporting rule fall on large traders.
Accordingly, the Acting Chairman, on behalf of the Commission, hereby
certifies, pursuant to 5 U.S.C. 605(b), that the actions adopted herein
will not have a significant economic impact on a substantial number of
small entities.
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\16\ 47 FR 18618, 18618-21 (April 30, 1982).
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C. The Paperwork Reduction Act
The Paperwork Reduction Act (PRA) \17\ imposes certain requirements
on Federal agencies, including the Commission, in connection with
conducting or sponsoring any collection of information as defined by
the PRA. An agency may not conduct or sponsor, and a person is not
required to respond to, a collection of information unless it displays
a currently valid control number. In its proposal, the Commission noted
that the proposed amendments would require traders with reportable
positions to keep books and records showing all details concerning all
positions and transactions in the commodity in which the trader is
reportable and to furnish to the Commission, upon request, any
pertinent information concerning such positions, transactions or
activities in a form acceptable to the Commission and that this
information is part of an approved collection of information. The
Commission further noted that the proposed amendments would not result
in any material modifications to this approved collection. Accordingly,
for purposes of the PRA, the Commission certified that the proposed
amendment did not impose any new reporting or recordkeeping
requirements.
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\17\ Public Law 104-13 (May 13, 1995).
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The Commission submitted the proposed rule amendments and their
associated information collection requirements to the Office of
Management and Budget (OMB) for its review. No comments were received
in response to the Commission's invitation in the notice of proposed
rulemaking to comment on the information which would be required by the
proposed rule amendments.
List of Subjects in 17 CFR Part 18
Commodity futures, Reporting and recordkeeping requirements.
0
Accordingly, 17 CFR Chapter I is amended as follows:
PART 18--REPORTS BY TRADERS
0
1. The authority citation for part 18 is revised to read as follows:
Authority: 7 U.S.C. 2, 4, 5, 6a, 6c, 6f, 6g, 6i, 6k, 6m, 6n, 12a
and 19; 5 U.S.C. 552 and 552(b), unless otherwise noted.
0
2. Revise Sec. 18.05 to read as follows:
Sec. 18.05 Maintenance of books and records.
(a) Every trader who holds or controls a reportable futures or
option position shall keep books and records showing all details
concerning all positions and transactions in the commodity:
(1) On all reporting markets;
(2) Over the counter and/or pursuant to Sections 2(d), 2(g) or
2(h)(1)-(2) of the Act or Part 35 of this chapter;
(3) On exempt commercial markets operating pursuant to Sections
2(h)(3)-(5) of the Act;
(4) On exempt boards of trade operating pursuant to Section 5d of
the Act; and
(5) On foreign boards of trade.
(b) Every such trader shall also keep books and records showing all
details concerning all positions and transactions in the cash
commodity, its products and byproducts, and all commercial activities
that the trader hedges in the futures or option contract in which the
trader is reportable.
(c) The trader shall upon request furnish to the Commission any
pertinent information concerning such positions, transactions, or
activities in a form acceptable to the Commission.
Issued in Washington, DC, this 22nd day of October, 2007, by the
Commission.
David A. Stawick,
Secretary of the Commission.
[FR Doc. E7-21077 Filed 10-25-07; 8:45 am]
BILLING CODE 6351-01-P