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Rules & Rule Amendments

  • Rules of Enumerated Agricultural Commodities


    Designated contract markets
    (DCMs) must submit to the CFTC, and receive CFTC approval prior to implementation, all new rules and rule amendments that materially change the terms and conditions of contracts on commodities enumerated in Section 1a(4) of the Commodity Exchange Act (CEA), 7 USC 1a(4), and that will apply to contracts with open interest.

    Such new rules and rule amendments cannot be implemented pursuant to the certification procedures of CFTC Regulation 40.6, 17 CFR 40.6, but must be submitted to the Commission for approval under CFTC Regulation 40.4 and CFTC Regulation 40.5, 17 CFR 40.4 and 40.5, or for a determination as to whether such rules or rule amendments materially change the terms and conditions of the affected contracts pursuant to CFTC Regulation 40.4(b)(9), 17 CFR 40.4(b)(8).

    CFTC staff reviews new rules and rule amendments submitted for approval to ensure that they do not violate any provision of the Commodity Exchange Act or the CFTC's regulations and policies adopted thereunder. The general requirements for designated contract market rules are found in Section 5 of the CEA, 7 USC 7, and Part 38 of the CFTC's regulations, 17 CFR Part 38. The particular requirements for approval of new rules and rule amendments related to the economic terms and conditions of a futures or option contract are contained in the CFTC's Guideline No. 1, Appendix A to Part 40 of the CFTC’s regulations.

    If the CFTC determines that a new rule or rule amendment is consistent with the requirements of the Commodity Exchange Act and the CFTC’s regulations and policies, the new rule or rule amendment is deemed approved 45 days after CFTC receipt of the approval request, or at the conclusion of any extended review period, as provided under CFTC Regulation 40.5(b) and CFTC Regulation 40.5(c). If the CFTC determines that it will not, or is unable to, approve the new rule or rule amendment, it will provide a Notice of Non-Approval to the designated contract market, as provided under CFTC Regulation 40.5(d). In this Notice of Non-Approval, the CFTC will briefly specify the nature of the issues identified and the specific provision of the Commodity Exchange Act or CFTC regulations that the new rules or rule amendments violate.

    A designated contract market receiving a Notice of Non-Approval may not certify the same, or substantially the same, new rules or rule amendments under the certification procedures of CFTC Regulation 40.6, 17 CFR 40.6. However, the DCM may submit revised new rules or rule amendments for approval under these same procedures.

    New Rules or Rule Amendments for Contracts Based on Enumerated Agricultural Commodities Not Requiring Prior CFTC Approval


    Rules Deemed Not To Be Material

    CFTC Regulation 40.4(b)
    , 17 CFR 40.4(b), specifies eight categories of new rules and rule amendments for contracts based on enumerated agricultural commodities that are deemed not to be material and thus are not required to be submitted to the CFTC for approval prior to implementation. New rules and rule amendments that are deemed not to be material for this purpose are:

      1. Changes in trading hours;

      2. Changes in lists of approved delivery facilities pursuant to previously set standards or criteria;

      3. Changes to the terms and conditions of options on futures, other than those relating to the last trading day, expiration date, option strike price de-listings, and speculative position limits;

      4. Reductions in the minimum price fluctuation (or “tick”);

      5. Changes required to comply with a binding order of a court of competent jurisdiction, or a rule, regulation, or order of the Commission, or of another Federal regulatory authority;

      6. Corrections of typographical errors, renumbering, periodic routine updates to identifying information about approved entities, and such other non-substantive revisions of a product’s terms and conditions that have no effect on the economic characteristics of the product;

      7. Fees or fee changes of less than $1.00 per contract; and

      8. Fees or fee changes that are $1.00 or more per contract and are established by an independent third party or are unrelated to delivery, trading, clearing, or dispute resolution.

    A designated contract market wishing to implement new rules or rule amendments falling within any of the above eight categories may implement such provisions under the certification procedures of CFTC Regulation 40.6.

    Rules Determined Not To Be Material Under the Ten-day Review Procedure
    CFTC Regulation 40.4(b)(9)
    , 17 CFR 40.4(b)(9), establishes a ten-day review procedure for designated contract markets wishing to apply a new rule or rule amendment to contracts having open interest in enumerated agricultural commodities that do not fall within any of the above eight categories. This procedure provides DCMs which are uncertain as to whether a new rule or rule amendment is material with a mechanism for obtaining a CFTC determination as to whether such new rule or rule amendment materially changes the terms and conditions of the affected contracts.

    Under this procedure, a designated contract market must submit the new rules or rule amendments to the CFTC at least ten business days prior to the anticipated implementation date.

    Submissions of new rules or rule amendments under this procedure should be labeled “Non-Material Agricultural Rule Change,” addressed to the Secretary of the Commission, and sent either via mail to the Commission’s Washington, DC headquarters office or electronically via email to secretary@cftc.gov.

    If the CFTC determines that the new rule or rule amendment is not material, CFTC staff will advise the designated contract market of this non-materiality determination the day after the ten-day review period expires. The DCM may then implement the new rule or rule amendment pursuant to the self-certification provisions of CFTC Regulation 40.6. If the CFTC determines that the new rule or rule amendment is material, it will advise the designated contract market of that finding and commence reviewing the new rule or rule amendment under the approval procedures set forth in CFTC Regulation 40.5, 17 CFR 40.5.

    Enumerated Agricultural Commodities


    The agricultural commodities listed here are commonly referred to as the enumerated commodities of the Commodity Exchange Act:

    • wheat
    • cotton
    • rice
    • corn
    • oats
    • barley
    • rye
    • flaxseed
    • grain sorghums
    • mill feeds
    • butter
    • eggs
    • Solanum tuberosum (Irish potatoes)
    • wool
    • wool tops
    • fats and oils (including lard, tallow, cottonseed oil, peanut oil, soybean oil, and all other fats and oils)
    • cottonseed
    • cottonseed meal
    • peanuts
    • soybeans
    • soybean meal
    • livestock
    • livestock products
    • frozen concentrated orange juice.