2015-27535
[Federal Register Volume 80, Number 209 (Thursday, October 29, 2015)]
[Notices]
[Pages 66493-66495]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-27535]
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COMMODITY FUTURES TRADING COMMISSION
Fees for Reviews of the Rule Enforcement Programs of Designated
Contract Markets and Registered Futures Associations
AGENCY: Commodity Futures Trading Commission.
ACTION: Notice of 2015 schedule of fees.
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SUMMARY: The Commodity Futures Trading Commission (``CFTC'' or
``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 rule enforcement programs, specifically
National Futures Association, a registered futures association, and the
designated contract markets. The calculation of the fee amounts charged
for 2015 by this notice is based upon an average of actual program
costs incurred during fiscal year (``FY'') 2012, FY 2013, and FY 2014.
DATES: Effective date: Each self-regulatory organization is required to
remit electronically the applicable fee on or before December 28, 2015.
FOR FURTHER INFORMATION CONTACT: Mary Jean Buhler, Chief Financial
Officer, Commodity Futures Trading Commission; (202) 418-5089; Three
Lafayette Centre, 1155 21st Street NW., Washington, DC 20581. For
information on electronic payment, contact Jennifer Fleming; (202) 418-
5034; Three Lafayette Centre, 1155 21st Street NW., Washington, DC
20581.
SUPPLEMENTARY INFORMATION:
I. Background Information
A. General
This notice relates to fees for the Commission's review of the rule
enforcement programs at the registered
[[Page 66494]]
futures associations \1\ and designated contract markets (``DCM''),
each of which is a self-regulatory organization (``SRO'') regulated by
the Commission. The Commission recalculates the fees charged each year
to cover the costs of operating this Commission program.\2\ The fees
are set each year based on direct program costs, plus an overhead
factor. The Commission calculates actual costs, then calculates an
alternate fee taking volume into account, and then charges the lower of
the two.\3\
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\1\ National Futures Association is the only registered futures
association.
\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.
\3\ 58 FR 42643, Aug. 11, 1993, and 17 CFR part 1, app. B.
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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 generally consist 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): 161 percent for FY 2012,
181 percent for FY 2013, and 180 percent for FY 2014.
C. Conduct of SRO Rule Enforcement Reviews
Under the formula adopted by the Commission in 1993, 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.
As noted above, 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 = 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 of the resulting fee for each entity:
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Actual total costs Volume
--------------------------------------- 3-Year average 3-Year percent adjusted 2015 Assessed
FY 2012 FY 2013 FY 2014 actual costs of volume costs fee
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CBOE Futures..................................... $29,278 $235,567 $-- $88,282 0.98 $50,853 $50,853
Chicago Board of Trade........................... 238,392 164,974 55,515 152,960 30.02 281,079 152,960
Chicago Mercantile Exchange...................... 757,347 391,917 225,701 458,322 44.93 535,344 458,322
ELX Futures...................................... 34,593 134,267 ........... 56,287 0.026 28,320 28,320
ICE Futures U.S.................................. 221,813 360,223 81,176 221,071 8.56 168,880 168,880
Kansas City Board of Trade....................... 34,335 559 ........... 11,631 0.12 6,615 6,615
Minneapolis Grain Exchange....................... 60,897 220,975 47,648 109,840 0.04 55,225 55,225
NADEX North American............................. 11,293 101,252 980 37,842 0.033 19,147 19,147
New York Mercantile Exchange .................... 7,411 135,316 225,672 122,800 14.69 161,480 122,800
NYSE LIFFE US.................................... 71,317 24,802 ........... 32,039 0.34 18,354 18,354
One Chicago...................................... 55,755 128,599 31,196 71,850 0.241 37,568 37,568
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Subtotal..................................... 1,522,431 1,898,451 667,888 1,362,924 100 1,362,865 1,119,044
National Futures Association..................... 487,328 186,499 292,102 321,976 .............. .............. 321,976
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Total.................................... 2,009,759 2,084,950 959,990 1,684,900 .............. .............. 1,441,020
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An example of how the fee is calculated for one exchange, the
Chicago Board of Trade, is set forth here:
a. Actual three-year average costs equal $152,960.
b. The alternative computation is: (.5) ($152,960) + (.5) (.30)
($1,347,041) = $278,695.
c. The fee is the lesser of a or b; in this case $152,960.
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 2012 through 2014 was $321,976. The fee to be paid by the NFA for
the current fiscal year is $321,976.
[[Page 66495]]
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 are as follows:
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2015 Fee lesser
3-Year average 3-Year percent of of actual or
actual cost volume calculated fee
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CBOE Futures.......................................... $88,282 0.98 $50,853
Chicago Board of Trade................................ 152,960 30.02 152,960
Chicago Mercantile Exchange........................... 458,322 44.93 458,322
ELX Futures........................................... 56,287 0.03 28,320
ICE Futures U.S....................................... 221,071 8.56 168,880
Kansas City Board of Trade............................ 11,631 0.12 6,615
Minneapolis Grain Exchange............................ 109,840 0.04 55,225
NADEX North American.................................. 37,842 0.03 19,147
New York Mercantile Exchange.......................... 122,800 14.69 122,800
NYSE LIFFE US......................................... 32,039 0.34 18,354
One Chicago........................................... 71,850 0.2412 37,568
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Subtotal.......................................... 1,362,924 100 1,119,044
National Futures Association.......................... 321,976 .................. 321,976
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Total......................................... 1,684,900 .................. 1,441,020
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III. 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
Jennifer Fleming at (202) 418-5034 or [email protected], or see the
CFTC Web site at www.cftc.gov, specifically, www.cftc.gov/cftc/cftcelectronicpayments.htm.
(Authority: 7 U.S.C. 16a)
Issued in Washington, DC, on October 23, 2015, by the
Commission.
Christopher J. Kirkpatrick,
Secretary of the Commission.
[FR Doc. 2015-27535 Filed 10-28-15; 8:45 am]
BILLING CODE 6351-01-P