[Federal Register: August 12, 2004 (Volume 69, Number 155)]
[Rules and Regulations]
[Page 49800-49803]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12au04-4]

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

COMMODITY FUTURES TRADING COMMISSION

17 CFR Part 30

RIN 3038-AB45


Foreign Futures and Foreign Options Transactions

AGENCY: Commodity Futures Trading Commission.

ACTION: Final rule.

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

SUMMARY: The Commodity Futures Trading Commission (Commission or CFTC)
is amending part 30 of the Commission's regulations to clarify the
circumstances under which a foreign futures and options broker (FFOB)
that is a member of a foreign board of trade must register or obtain an
exemption from registration. The Commission has amended Rule 30.4(a) to
clarify that FFOBs are not required to register as futures commission
merchants (FCMs) pursuant to Rule 30.4, or to seek exemption from
registration under Rule 30.10, if they only carry the following types
of U.S.-related accounts that trade on or are subject to the rules of
non-U.S. exchanges: Customer omnibus accounts for U.S. FCMs; U.S.
affiliate accounts that are proprietary to the FFOB; and/or U.S.
accounts that are proprietary to a U.S. FCM. In addition, an FFOB that
has U.S. bank branches will be eligible for a Rule 30.10 comparability
exemption or exemption from registration under Rule 30.4 based upon
compliance with conditions specified in Rule 30.10(b)(1)-(6) and
thereby will be able to carry any U.S.-related account for trades on
non-U.S. exchanges. The Commission has also deleted Rule 30.4(e), which
required an FCM registered under part 30 to maintain a U.S. office.

EFFECTIVE DATE: September 13, 2004.

FOR FURTHER INFORMATION CONTACT: Lawrence B. Patent, Deputy Director,
or Susan A. Elliott, Special Counsel, Compliance and Registration
Section, Division of Clearing and Intermediary Oversight, Commodity
Futures Trading Commission. Three Lafayette Centre, 1155 21st Street,
NW., Washington, DC 20581. Telephone: (202) 418-5439 or (202) 418-5464,
or electronic mail: [email protected] or [email protected].


SUPPLEMENTARY INFORMATION:

I. Background

    The Commission has adopted final rules that were first published
for comment on August 26, 1999,\1\ and republished on April 6, 2004.\2\
The Commission proposed amending part 30 of its rules to clarify when
foreign futures and options brokers that are members of a foreign board
of trade or affiliates of U.S. FCMs must register under the Act or
obtain an exemption from registration under the Act.
---------------------------------------------------------------------------

    \1\ 64 FR 46613 (August 26, 1999).
    \2\ 69 FR 17998 (April 6, 2004). The reproposal was
substantially the same, except that the 1999 proposal required an
entity with a U.S. bank branch applying for a Rule 30.10 exemption
to file a specified set of representations with the National Futures
Association (NFA), while the 2004 reproposal listed the
representations as conditions for compliance with the exemption, in
order to reduce the paperwork necessitated by the rule amendments.
---------------------------------------------------------------------------

    The Commission's part 30 rules govern, generally, the solicitation
and sale of foreign futures \3\ and foreign option \4\ contracts to
customers \5\ located in the U.S. Rule 30.4(a) requires any person who
solicits or accepts orders and money for foreign futures or foreign
option contracts from foreign futures or foreign options customers \6\
to register as an FCM under the Act. Rule 30.10 permits any person to
seek exemption from any provision of part 30.
---------------------------------------------------------------------------

    \3\ ``Foreign futures'' as defined in part 30 means ``any
contract for the purchase or sale of any commodity for future
delivery made, or to be made, on or subject to the rules of any
foreign board of trade.'' Commission Rule 30.1(a).
    \4\ ``Foreign option'' as defined in part 30 means ``any
transaction or agreement which is or is held out to be of the
character of, or is commonly known to the trade as, an ``option'',
``privilege'', ``indemnity'', ``bid'', ``offer'', ``put'', ``call'',
``advance guaranty'', or ``decline guaranty'', made or to be made on
or subject to the rules of any foreign board of trade.'' Commission
Rule 30.1(b).
    \5\ Pursuant to Commission Rule 30.1(c), ``Foreign futures or
foreign options customer'' means ``any person located in the United
States, its territories or possessions who trades in foreign futures
or foreign options: Provided, That an owner or holder of a
proprietary account as defined in paragraph (y) of [Commission Rule
1.3] shall not be deemed to be a foreign futures or foreign options
customer within the meaning of Sec. Sec.  30.6 and 30.7 of this
part.''
    \6\ See n. 5, supra.
---------------------------------------------------------------------------

    Under Rule 30.10 and Appendix A thereto, the CFTC may exempt an
FFOB from compliance with certain rules, including those rules
pertaining to registration, provided that a comparable regulatory
system exists in the firm's home country and that certain safeguards
are in place to protect U.S. investors. This exemption process requires
that the CFTC issue an Order pursuant to Rule 30.10 granting general
relief to the foreign regulator or self-regulatory organization and
that individual firms be granted confirmation of relief upon proper
application. Generally, a firm that confirms relief under Rule 30.10
must be located outside the U.S. and this relief permits a firm to
solicit or accept orders from U.S.-located customers for trading on or
subject to the rules of exchanges located outside of the U.S.

II. Final Rules

A. Registration Exemptions

    As explained in the rule proposal, the Commission believes that it
can provide clarity to its registration requirements under part 30 by
specifically addressing, in Rule 30.4, when registration by an FFOB is
not required. Thus, the Commission has amended Rule 30.4(a)

[[Page 49801]]

to clarify that FFOBs are not required to register as FCMs if they only
carry the following types of U.S.-related accounts that trade on or
subject to the rules of non-U.S. exchanges: (1) Foreign futures and
options customer omnibus accounts \7\ of U.S. FCMs; (2) its own
proprietary accounts (including accounts of its U.S. affiliates and
others whose accounts are ``proprietary'' to the FFOB under CFTC Rule
1.3(y)); and/or (3) proprietary accounts of a U.S. FCM. These FFOBs,
however, otherwise remain subject to provisions of part 30 that are not
dependent upon registration as an FCM, such as the antifraud provision
of Rule 30.9. The exemption from registration is self-executing and
does not require entities seeking to avail themselves of the exemption
to file a petition under Rule 30.10.
---------------------------------------------------------------------------

    \7\ ``Foreign futures and options customer omnibus account'' is
defined at Rule 30.1(d), 17 CFR 30.1(d) (2003).
---------------------------------------------------------------------------

    An FFOB is eligible for Rule 30.10 relief notwithstanding the
presence in the U.S. of a separately-incorporated affiliate or
subsidiary that engages in a related activity if the following
procedural requirements are met: (1) The applicant must identify the
name and location of any affiliate or subsidiary in the U.S. which acts
in a related capacity (e.g., bank, broker-dealer or dealer in a cash
commodity); (2) the applicant must represent that it will not accept
any futures-related business from any of its affiliates or subsidiaries
in the U.S. other than a proprietary account of the affiliate or
subsidiary, unless such entities are registered with the CFTC in the
appropriate capacity; and (3) the applicant must represent that it has
informed its affiliates or subsidiaries in writing that they may not
introduce to, or solicit futures business on behalf of, the applicant,
unless such entities are registered with the CFTC in the appropriate
capacity.
    As explained in the rule proposal, in certain cases CFTC staff has
permitted an FFOB with U.S. bank branches to obtain a Rule 30.10
exemption under certain conditions on the grounds that a bank branch is
viewed as a separate legal entity in many respects under the U.S.
federal bank regulatory scheme. This rule codifies those staff
positions as set forth in interpretative statements and no-action
letters.\8\ The Commission is amending Rule 30.10 to clarify that an
FFOB with U.S. bank branches may be eligible for confirmation of Rule
30.10 relief if it complies with the following conditions:
---------------------------------------------------------------------------

    \8\ See n. 12, infra.
---------------------------------------------------------------------------

    (1) No U.S. bank branch, office or division will engage in the
trading of futures or options on futures within or from the U.S.,
except for its own account; \9\
---------------------------------------------------------------------------

    \9\ That is, the ``house'' account of the entity. This is the
``narrow'' definition of the term ``proprietary,'' as set forth in
Commission Rule 1.17(b)(3).
---------------------------------------------------------------------------

    (2) No U.S. bank branch, office or division will refer any foreign
futures or foreign options customer to the FFOB or otherwise be
involved in the FFOB's business in foreign futures and foreign option
transactions;
    (3) No U.S. bank branch, office or division will solicit any
foreign futures or foreign options business or purchase or sell foreign
futures or foreign option contracts on behalf of any foreign futures or
foreign option customers or otherwise engage in any activity subject to
regulation under Part 30 or engage in any clerical duties related
thereto. If any U.S. division, office or branch desires to engage in
such activities, it will only do so through an appropriate CFTC
registrant;
    (4) The FFOB will maintain outside the U.S. all contract documents,
books and records regarding foreign futures and option transactions;
    (5) The FFOB and each of its U.S. bank branches, offices or
divisions agree to provide upon request of the Commission, the NFA or
the U.S. Department of Justice, access to their books and records for
the purpose of ensuring compliance with the undertakings and consent to
make such records available for inspection at a location in the U.S.
within 72 hours after service of the request; \10\ and
---------------------------------------------------------------------------

    \10\ The Commission has recognized that Japanese and Hong Kong
laws require that original books and records of any firm located
within either country be maintained within the local jurisdiction.
See CFTC Staff Letter 95-83 [1994-1996 Transfer Binder] Comm. Fut.
L. Rep. (CCH) ] 26,559 at 43,490 (September 20, 1995) (no-action
position permitting the Japanese and Hong Kong affiliates of a U.S.
FCM to accept directly foreign futures and options orders from
certain sophisticated U.S. customers); 62 FR 47792 (September 11,
1997) (extending the relief under CFTC Staff Letter 95-83 to the
Japanese and Hong Kong affiliates of all U.S. FCMs). That letter is
now superceded by this rule. For the purpose of this rulemaking, the
Commission will allow foreign futures and options brokers in Japan
and Hong Kong to satisfy the books and records requirement by: (1)
Providing within 72 hours authenticated copies of its books and
records upon request of a Commission, NFA or U.S. Department of
Justice representative; (2) providing within 72 hours access to
original books and records in the foreign jurisdiction; (3) waiving
objection to the admissibility of the copies as evidence in a
Commission, NFA or U.S. Department of Justice action against the
foreign futures and options broker; and (4) agreeing in the event of
a proceeding to provide a witness to authenticate copies of books
and records given to the Commission, NFA, or the U.S. Department of
Justice. The Commission is clarifying that the books and records
from a Japanese or Hong Kong FFOB are also subject to request by NFA
and U.S. Department of Justice representatives, as is the case for
an FFOB in any other jurisdiction.
---------------------------------------------------------------------------

    (6) Although it will continue to engage in normal commercial
activities, no U.S. bank branch, office or division will establish
relationships in the U.S. with the broker's foreign futures and foreign
options customers for the purpose of facilitating or effecting
transactions in foreign futures and foreign option contracts in the
U.S.
    Pursuant to these rule amendments, an FFOB that is not required to
register under Rule 30.4(a) because it solely carries a U.S. customer
omnibus account, an account that would be classified as proprietary to
the broker under Commission Rule 1.3(y), or a U.S. FCM's proprietary
account, is also not required to register solely because it has U.S.
bank branches, so long as it complies with the conditions specified in
Rule 30.10(b)(1)-(6), as listed above.\11\
---------------------------------------------------------------------------

    \11\ The rationale for providing relief to foreign firms with
bank branches in the U.S. is that those branches are otherwise
regulated by the banking authorities. Although this rationale would
be inapplicable to non-bank branches, there may be other reasons why
exemption from registration under part 30 would be appropriately
granted upon application by Commission staff.
---------------------------------------------------------------------------

    The main difference in the two types of exemptions referred to
herein relate to whether the firm seeking exemption is otherwise
regulated and what type of accounts it may handle. The exemptions in
Rule 30.4 apply to any foreign firm, irrespective of whether it is a
member of an exchange or other self-regulatory organization, or a
regulatee of a foreign regulatory authority, that has received a
Commission order under Rule 30.10. However, such an entity may only
handle those U.S.-related accounts described above, customer omnibus or
proprietary to itself or to a U.S. FCM. By contrast, the firm seeking
confirmation of relief under Rule 30.10 must be otherwise regulated by
an entity that has received a Commission order under Rule 30.10, which
relief permits the firm to handle any U.S.-related accounts. In either
case, if the firm in question has bank branches, the conditions set
forth in Rule 30.10(b)(1)-(6) must be met.
    The Commission's adoption of these rule amendments supercedes prior
staff positions on these subjects.\12\ Because

[[Page 49802]]

the rule amendments contain no substantive changes to prior staff
interpretative statements and no-action letters, no party should be
disadvantaged. The new rules will make these staff positions more
accessible and more widely understood and obviate the need for
individualized relief.
---------------------------------------------------------------------------

    \12\ See CFTC Staff Letter 87-7 (customer omnibus accounts),
[1987-1990 Transfer Binder] Comm. Fut. L. Rep. (CCH) ] 23,972
(November 17, 1987); CFTC Staff Letter 88-15 (proprietary accounts),
[1987-1990 Transfer Binder] Comm. Fut. L. Rep. (CCH) ] 24,296
(August 10, 1988); CFTC Staff Letter 89-5 (bank branches), [1987-
1990 Transfer Binder] Comm. Fut. L. Rep. (CCH) ] 24,471 (December 8,
1988); and CFTC Staff Letter 89-11 (bank branches), [1987-1990
Transfer Binder] Comm. Fut. L. Rep. (CCH) ] 24,516 (August 15,
1989).
---------------------------------------------------------------------------

    Two comments were submitted in response to the Commission's
reproposal. Both were generally supportive of the rule amendments. One
comment suggested clarification of the applicability of amended Rule
30.4(a), because the preamble to the reproposal limited its
applicability to FFOBs with foreign futures and foreign options
customer omnibus accounts of U.S. FCMs ``but [that] have no direct
contact with the customers whose accounts comprise the omnibus
accounts.'' \13\ The commenter was concerned that the quoted phrase
could be read as contradicting Commission Rule 30.12, which permits
certain foreign firms to accept and to execute orders directly from
U.S. customers without having to register with the Commission. In
response to this comment, the Commission emphasizes that the amended
Rule 30.4(a) in no way limits the scope of Rule 30.12.
---------------------------------------------------------------------------

    \13\ 69 FR 17988 at 17999 (April 6, 2004).
---------------------------------------------------------------------------

B. U.S. Office

    Finally, the Commission is deleting Rule 30.4(e) to eliminate an
inconsistency and source of potential confusion. Rule 30.4(e) stated
that ``persons required to be registered as [an FCM] must maintain an
office in the United States which is managed by an individual domiciled
in the United States and registered with the Commission as an
associated person.'' Rule 30.4(e) was originally adopted because of a
concern that unscrupulous firms might establish their base of
operations offshore.\14\
    A few months after Rule 30.4(e) was adopted as a provision of the
original Part 30 rules, a staff interpretation clarified that a policy
basis for the provision was the assurance that a foreign FCM can
produce its books and records--but that if it can otherwise demonstrate
that capability and its willingness to do so, that is sufficient.\15\
NFA implemented this interpretation and it is currently set forth in
Rule 802. Paragraph (a)(9)(i) of that rule requires production of
records in the U.S. on 72 hours' notice, except that FCMs must produce
on 24 hours' notice except for good cause shown. A foreign applicant
also certifies, per paragraph (a)(9)(iv), that it is not subject to any
blocking, privacy or secrecy laws that would interfere with or create
an obstacle to full inspection of the applicant's books and records by
the CFTC, the Department of Justice, and NFA.
---------------------------------------------------------------------------

    \14\ 52 FR 28980 at 28990 (August 5, 1987).
    \15\ The letter, directed to NFA, stated that it would be
``other good cause'' to deny registration to a foreign-located firm
``unless the applicant has an office in the United States, its
territories or possessions, or the applicant is otherwise able to
demonstrate that it has adopted appropriate procedures for producing
its books and records in the United States expeditiously upon
request, and the applicant can and does represent that it will
comply with such procedures.'' Staff Letter 87-10, [1987-1990
Transfer Binder] Comm. Fut. L. Rep. (CCH) ] 23,999 (Dec. 9, 1987).
(Emphasis in original.)
---------------------------------------------------------------------------

    Although the coverage of Rule 30.4(e) was limited strictly to those
persons required to register as FCMs under Rule 30.4 (and therefore
engaged in transactions on or subject to the rules of foreign boards of
trade), the provision has no counterpart with respect to trades done on
designated contract markets by foreign firms, and does not include
foreign-based commodity trading advisors (CTAs), commodity pool
operators (CPOs) and introducing brokers (IBs).
    In light of these factors, the Commission is revoking Rule 30.4(e).
The Commission notes that foreign firms seeking to solicit or accept
orders and funds related thereto from U.S.-located customers for
transactions on non-U.S. exchanges do not apply for registration as
FCMs under Rule 30.4, but instead submit the appropriate certification
to confirm exemption relief granted by Commission order under Rule
30.10 to the firms' foreign regulator or self-regulatory organization.
The Commission also notes that, as of September 30, 2004, there were
more than 470 foreign-based IBs, CPOs and CTAs and the Commission has
not observed any special concerns as a result.

III. Related Matters

A. Administrative Procedure Act

    The Administrative Procedure Act generally requires that, before an
agency adopts a rule, the agency provide an opportunity for notice and
comment thereon. That opportunity is not required, however, when the
agency for good cause finds such procedure unnecessary. The Commission
is eliminating Rule 30.4(e) without provision for notice and comment
because such procedure is unnecessary, per section 553(b)(3)(B) of the
Administrative Procedure Act, 5 U.S.C. 553(b)(3)(B) (2004). Rule
30.4(e) has never been applied because, as discussed above, foreign
firms seeking to solicit or accept orders and funds related thereto
from U.S.-located customers for transactions on non-U.S. exchanges do
not apply for registration as FCMs under Rule 30.4, but instead submit
the appropriate certification to confirm exemption relief granted by
Commission order under Rule 30.10 to the firms' foreign regulator or
self-regulatory organization. In addition, Rule 30.4(e) may be
eliminated because its purposes are now accomplished by NFA's Rule 802,
as discussed above.

B. Regulatory Flexibility Act

    The Regulatory Flexibility Act (``RFA''), 5 U.S.C. 601-611,
requires that agencies, in proposing rules, consider the impact of
those rules on small businesses. The Commission has previously
established certain definitions of ``small entities'' to be used by the
Commission in evaluating the impact of its rules on such entities in
accordance with the RFA.\16\ In proposing these amendments to part 30,
the Commission stated that they would affect foreign members of foreign
boards of trade who perform the functions of an FCM, some of which may
be foreign affiliates of U.S. FCMs. The Commission previously has
determined that, based upon the fiduciary nature of the FCM/customer
relationships, as well as the requirement that FCMs meet minimum
financial requirements, FCMs should be excluded from the definition of
small entities. No comment was received regarding the impact of these
amendments on small businesses.
---------------------------------------------------------------------------

    \16\ 47 FR 18618-18621 (April 30, 1982).
---------------------------------------------------------------------------

C. Paperwork Reduction Act

    As required by the Paperwork Reduction Act of 1995,\17\ the
Commission submitted a copy of the proposed rule amendments to the
Office of Management and Budget for its review. The Commission did not
receive any public comments relative to its analysis of paperwork
burdens associated with this rulemaking.
---------------------------------------------------------------------------

    \17\ Pub. L. 104-13 (May 13, 1995).
---------------------------------------------------------------------------

D. 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 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 proposed regulation outweigh its costs.
Rather, section 15(a) simply requires the Commission to ``consider the
costs and benefits'' of its action. Section 15(a)

[[Page 49803]]

further specifies that costs and benefits shall be evaluated in light
of five broad areas of market and public concern: Protection of market
participants and the public; efficiency, competitiveness, and financial
integrity of futures markets; price discovery; sound risk management
practices; and other public interest considerations. Accordingly, the
Commission could in its discretion give greater weight to any one of
the five enumerated areas and could in its discretion determine that,
notwithstanding its costs, a particular rule was 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 published an analysis of costs and benefits when it
proposed the rule amendments that have now been adopted.\18\ It did not
receive any public comments pertaining to the analysis.
---------------------------------------------------------------------------

    \18\ 69 FR 17988 at 18000 (April 6, 2004).
---------------------------------------------------------------------------

List of Subjects in 17 CFR Part 30

    Definitions, Foreign futures, Foreign options, Reporting and
recordkeeping requirements, Registration requirements.


0
In consideration of the foregoing, and pursuant to the authority
contained in the Commodity Exchange Act and, in particular, sections
2(a)(1), 4(b), 4c and 8 thereof, 7 U.S.C. 2, 6(b), 6c and 12a, and
pursuant to the authority contained in 5 U.S.C. 552 and 552b, the
Commission hereby amends Chapter I of Title 17 of the Code of Federal
Regulations as follows:

PART 30--FOREIGN OPTIONS AND FOREIGN FUTURES TRANSACTIONS

0
1. The authority citation for part 30 continues to read as follows:

    Authority: 7 U.S.C. 1a, 2, 4, 6, 6c and 12a, unless otherwise
noted.


0
2. Section 30.4 is amended by revising paragraph (a) to read as
follows, and by removing paragraph (e):


Sec.  30.4  Registration required.

* * * * *
    (a) To solicit or accept orders for or involving any foreign
futures contract or foreign options transaction and, in connection
therewith, to accept any money, securities or property (or extend
credit in lieu thereof) to margin, guarantee or secure any trades or
contracts that result or may result therefrom, unless such person shall
have registered, under the Act, with the Commission as a futures
commission merchant and such registration shall not have expired nor
been suspended nor revoked; provided that, a foreign futures and
options broker (as defined in Sec.  30.1(e)) is not required to
register as a futures commission merchant: one, in order to accept
orders from or to carry a U.S. futures commission merchant's foreign
futures and options customer omnibus account, as that term is defined
in Sec.  30.1(d); two, in order to accept orders from or to carry a
U.S. futures commission merchant's proprietary account, as that term is
defined in paragraph (y) of Sec.  1.3 of this chapter; and/or three, in
order to accept orders from or carry a U.S. affiliate account which is
proprietary to the foreign futures and options broker, as ``proprietary
account'' is defined in paragraph (y) of Sec.  1.3 of this chapter.
Such foreign futures and options broker remains subject to all other
applicable provisions of the Act and of the rules, regulations and
orders thereunder. Foreign futures and options brokers that have U.S.
bank branches, offices or divisions engaging in the activity listed in
this paragraph are not required to register as futures commission
merchants if they comply with the conditions listed in Sec.
30.10(b)(1) through (6).
* * * * *

0
3. Section 30.10 is amended by designating the existing text as
paragraph (a) and adding paragraph (b) to read as follows:


Sec.  30.10  Petitions for exemption.

* * * * *
    (b) Any foreign person that files a petition for an exemption under
this section shall be eligible for such an exemption notwithstanding
its presence in the United States through U.S. bank branches or
divisions if, in conjunction with a petition for confirmation of relief
granted under an existing Commission order issued pursuant to this
section, it complies with the following conditions:
    (1) No U.S. bank branch, office or division will engage in the
trading of futures or options on futures within or from the United
States, except for its own proprietary account;
    (2) No U.S. bank branch, office or division will refer any foreign
futures or foreign options customer to the foreign person or otherwise
be involved in the foreign person's business in foreign futures or
foreign option transactions;
    (3) No U.S. bank branch, office or division will solicit any
foreign futures or foreign option business or purchase or sell foreign
futures or foreign option contracts on behalf of any foreign futures or
foreign option customers or otherwise engage in any activity subject to
regulation under this part or engage in any clerical duties related
thereto. If any U.S. division, office or branch desires to engage in
such activities, it will only do so through an appropriate Commission
registrant;
    (4) The foreign person will maintain outside the United States all
contract documents, books and records regarding foreign futures and
foreign option transactions;
    (5) The foreign person and each of its U.S. bank branches, offices
or divisions agree to provide upon request of the Commission, the
National Futures Association or the U.S. Department of Justice, access
to their books and records for the purpose of ensuring compliance with
the foregoing undertakings and consent to make such records available
for inspection at a location in the United States within 72 hours after
service of the request; and
    (6) Although it will continue to engage in normal commercial
activities, no U.S. bank branch, office or division of the foreign
person will establish relationships in the United States with the
applicant's foreign futures or foreign option customers for the purpose
of facilitating or effecting transactions in foreign futures or foreign
option contracts.


    Dated: August 4, 2004.

    By the Commission.
Jean A. Webb,
Secretary of the Commission.
[FR Doc. 04-18344 Filed 8-11-04; 8:45 am]
BILLING CODE 6351-01-P