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e9-21545

  • FR Doc E9-21545[Federal Register: September 8, 2009 (Volume 74, Number 172)]

    [Notices]

    [Page 46115-46116]

    From the Federal Register Online via GPO Access [wais.access.gpo.gov]

    [DOCID:fr08se09-49]

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    COMMODITY FUTURES TRADING COMMISSION

    Fees for Reviews of the Rule Enforcement Programs of Contract

    Markets and Registered Futures Associations

    AGENCY: Commodity Futures Trading Commission.

    ACTION: Establish the FY 2009 schedule of fees.

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    SUMMARY: The Commission charges fees to designated contract markets and

    registered futures associations to recover the costs incurred by the

    Commission in the operation of its program of oversight of self-

    regulatory organization (SRO) rule enforcement programs (17 CFR part 1

    Appendix B) (National Futures Association (NFA), a registered futures

    association, and the contract markets are referred to as SROs). The

    calculation of the fee amounts to be charged for FY 2009 is based upon

    an average of actual program costs incurred during FY 2006, 2007, and

    2008, as explained below. The FY 2009 fee schedule is set forth in the

    SUPPLEMENTARY INFORMATION. Electronic payment of fees is required.

    DATES: Effective Dates: The FY 2009 fees for Commission oversight of

    each SRO rule enforcement program must be paid by each of the named

    SROs in the amount specified by no later than November 9, 2009.

    FOR FURTHER INFORMATION CONTACT: Stacy Dean Yochum, Deputy Executive

    Director, Commodity Futures Trading Commission, (202) 418-5157, Three

    Lafayette Centre, 1155 21st Street, NW., Washington, DC 20581. For

    information on electronic payment, contact Angela Clark, Three

    Lafayette Centre, 1155 21st Street, NW., Washington, DC 20581, (202)

    418-5178.

    SUPPLEMENTARY INFORMATION:

    I. General

    This notice relates to fees for the Commission's review of the rule

    enforcement programs at the registered futures associations \1\ and

    designated contract markets (DCM), which are referred to as SROs,

    regulated by the Commission.

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    \1\ NFA is the only registered futures association.

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    II. Schedule of Fees

    Fees for the Commission's review of the rule enforcement programs

    at the registered futures associations and DCMs regulated by the

    Commission:

    ------------------------------------------------------------------------

    Entity Fee amount

    ------------------------------------------------------------------------

    Chicago Board of Trade..................................... $77,371

    Chicago Mercantile Exchange................................ 121,071

    New York Mercantile Exchange............................... 197,535

    Kansas City Board of Trade................................. 10,127

    ICE Futures U.S............................................ 32,683

    Minneapolis Grain Exchange................................. 62,449

    HedgeStreet................................................ 14,375

    Chicago Climate Futures Exchange........................... 12,259

    U.S. Futures Exchange...................................... 18,601

    OneChicago................................................. 1,157

    National Futures Association............................... 179,641

    ------------

    Total.................................................. 727,270

    ------------------------------------------------------------------------

    III. Background Information

    A. General

    The Commission recalculates the fees charged each year with the

    intention of recovering the costs of operating this Commission

    program.\2\ All costs are accounted for by the Commission's Management

    Accounting Structure Codes (MASC) system, which records each employee's

    time for each pay period. The fees are set each year based on direct

    program costs, plus an overhead factor.

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    \2\ See Section 237 of the Futures Trading Act of 1982, 7 U.S.C.

    16a and 31 U.S.C. 9701. For a broader discussion of the history of

    Commission Fees, see 52 FR 46070 (Dec. 4, 1987).

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    B. Overhead Rate

    The fees charged by the Commission to the SROs are designed to

    recover program costs, including direct labor costs and overhead. The

    overhead rate is calculated by dividing total Commission-wide overhead

    direct program labor costs into the total amount of the Commission-wide

    overhead pool. For this purpose, direct program labor costs are the

    salary costs of personnel working in all Commission programs. Overhead

    costs consist generally of the following Commission-wide costs:

    indirect personnel costs (leave and benefits), rent, communications,

    contract services, utilities, equipment, and supplies. This formula has

    resulted in the following overhead rates for the most recent three

    years (rounded to the nearest whole percent): 109 percent for fiscal

    year 2006, 140 percent for fiscal year 2007, and 144 percent for fiscal

    year 2008.

    C. Conduct of SRO Rule Enforcement Reviews

    Under the formula adopted in 1993 (58 FR 42643, Aug. 11, 1993),

    which appears at 17 CFR Part 1 Appendix B, the Commission calculates

    the fee to recover the costs of its rule enforcement reviews and

    examinations, based on the three-year average of the actual cost of

    performing such reviews and examinations at each SRO. The cost of

    operation of the Commission's SRO oversight program varies from SRO to

    SRO, according to the size and complexity of each SRO's program. The

    three-year averaging computation method is intended to smooth out year-

    to-year variations in cost. Timing of the Commission's reviews and

    examinations may affect costs--a review or examination may span two

    fiscal years and reviews and examinations are not conducted at each SRO

    each year. Adjustments to actual costs may be made to relieve the

    burden on an SRO with a disproportionately large share of program

    costs.

    The Commission's formula provides for a reduction in the assessed

    fee if an SRO has a smaller percentage of United States industry

    contract volume than its percentage of overall Commission oversight

    program costs. This adjustment reduces the costs so that, as a

    percentage of total Commission SRO oversight program costs, they are in

    line with the pro rata percentage for that SRO of United States

    industry-wide contract volume.

    The calculation is made as follows: The fee required to be paid to

    the Commission by each DCM is equal to the lesser of actual costs based

    on the three-year historical average of costs for that DCM or one-half

    of average costs incurred by the Commission for each DCM for the most

    recent three years, plus a pro rata share (based on average trading

    volume for the most recent three years) of the aggregate of average

    annual costs of all DCMs for the most recent three years. The formula

    for calculating the second factor is: 0.5a + 0.5 vt =

    [[Page 46116]]

    current fee. In this formula, ``a'' equals the average annual costs,

    ``v'' equals the percentage of total volume across DCMs over the last

    three years, and ``t'' equals the average annual costs for all DCMs.

    NFA has no contracts traded; hence, its fee is based simply on costs

    for the most recent three fiscal years.

    This table summarizes the data used in the calculations and the

    resulting fee for each entity:

    ------------------------------------------------------------------------

    2009 Fee

    3-year 3-year % of (lesser of

    average volume actual or

    actual (percent) calculated

    costs fee)

    ------------------------------------------------------------------------

    Chicago Board of Trade........... $77,371 31.0879 $77,371

    Chicago Mercantile Exchange...... 121,071 55.2977 121,071

    New York Mercantile Exchange..... 306,092 11.2605 197,535

    Kansas City Board of Trade....... 18,998 0.1591 10,127

    ICE Futures U.S.................. 50,712 1.8545 32,683

    Minneapolis Grain Exchange....... 124,466 0.0548 62,449

    North American Derivatives 28,685 0.0082 14,375

    Exchange........................

    Chicago Climate Futures Exchange. 24,457 0.0076 12,259

    U.S. Futures Exchange............ 37,173 0.0038 18,601

    OneChicago....................... 1,157 0.2367 1,157

    Subtotal......................... 790,181 ........... 547,628

    National Futures Association..... 179,641 ........... 179,641

    --------------------------------------

    Total........................ 969,822 ........... 727,270

    ------------------------------------------------------------------------

    An example of how the fee is calculated for one exchange, the

    Minneapolis Grain Exchange, is set forth here:

    a. Actual three-year average costs equal $124,466.

    b. The alternative computation is:

    (.5) ($124,466) + (.5) (.000548) ($790,181) = $62,449

    c. The fee is the lesser of a or b; in this case $62,449.

    As noted above, the alternative calculation based on contracts

    traded is not applicable to NFA because it is not a DCM and has no

    contracts traded. The Commission's average annual cost for conducting

    oversight review of the NFA rule enforcement program during fiscal

    years 2007 through 2009 was $179,641 (one-third of $538,923). The fee

    to be paid by the NFA for the current fiscal year is $179,641.

    Payment Method

    The Debt Collection Improvement Act (DCIA) requires deposits of

    fees owed to the government by electronic transfer of funds (See 31

    U.S.C. 3720). For information about electronic payments, please contact

    Angela Clark at (202) 418-5178 or aclark@cftc.gov, or see the CFTC Web

    site at http://www.cftc.gov, specifically, http://www.cftc.gov/cftc/

    cftcelectronicpayments.htm.

    Regulatory Flexibility Act

    The Regulatory Flexibility Act, 5 U.S.C. 601, et seq., requires

    agencies to consider the impact of rules on small business. The fees

    implemented in this release affect contract markets and registered

    futures associations. The Commission has previously determined that

    contract markets and registered futures associations are not ``small

    entities'' for purposes of the Regulatory Flexibility Act. Accordingly,

    the Chairman, on behalf of the Commission, certifies pursuant to 5

    U.S.C. 605(b) that the fees implemented here will not have a

    significant economic impact on a substantial number of small entities.

    Issued in Washington, DC on September 1, 2009, by the

    Commission.

    David Stawick,

    Secretary of the Commission.

    [FR Doc. E9-21545 Filed 9-4-09; 8:45 am]

    Last Updated: September 8, 2009



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