[Federal Register: June 19, 1997 (Volume 62, Number 118)]
[Proposed Rules]
[Page 33379]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]



17 CFR Part 32

Public Meetings

AGENCY: Commodity Futures Trading Commission.

ACTION: Notice of public meetings.


TIME AND DATES: 1:00-4:00 p.m., Thursday, July 10, 1997 (Bloomington,
Illinois) and 9:00 a.m.-12:00 noon, Wednesday, July 16, 1997 (Memphis,

PLACE: July 10, 1997--Illinois State University, Bone Student Center,
(Corner of College & University), Old Main Room, Bloomington-Normal,
Illinois 61761, (309) 438-2222, and July 16, 1997--University of
Memphis, Fogelman Executive Center, Room 123, 330 Deloach St., Memphis,
Tennessee 38152, (901) 678-3635.


SUMMARY: Notice is hereby given that the Commodity Futures Trading
Commission (``Commission'') will convene public meetings at which
interested members of the public may appear to present oral and written
statements relating to the Commission's consideration of whether it
should propose rules to lift the prohibition on trade options on
enumerated agricultural products subject to conditions and, if so, what
conditions would be appropriate.

ADDRESSES: Requests to appear and statements of interest should be
mailed to the Commodity Futures Trading Commission, Three Lafayette
Centre, 1155 21st Street, NW., Washington, DC 20581, attention: Office
of the Secretariat; transmitted by facsimile at (202) 418-5521; or
transmitted electronically to [secretary@cftc.gov]. Reference should be
made to ``Agricultural Trade Options Meeting--Bloomington'' or
``Agricultural Trade Options Meeting--Memphis.''.

FOR FURTHER INFORMATION CONTACT: Paul M. Architzel, Chief Counsel,
Division of Economic Analysis, Commodity Futures Trading Commission,
Three Lafayette Centre, 1155 21st Street, NW., Washington, DC 20581,
(202) 418-5260, or electronically, [PArchitzel@cftc.gov].

SUPPLEMENTARY INFORMATION: Generally, the offer or sale of commodity
options is prohibited except on designated contract markets. 17 CFR
32.11. One of several specified exceptions to the general prohibition
on off-exchange options is for ``trade options.'' Trade options are
defined as off-exchange options ``offered by a person having a
reasonable basis to believe that the option is offered to'' categories
of commercial users specified in the rule, where such commercial user
``is offered or enters into the transaction solely for purposes related
to its business as such.'' 17 CFR 32.4(a). Trade options, however, are
not permitted on the agricultural commodities which are enumerated in
the Commodity Exchange Act, 7 U.S.C. 1 et seq. (Act). 17 CFR 32.2.
    The Commodity Futures Trading Commission (Commission) recently
published in the Federal Register an Advance Notice of Proposed
Rulemaking (62 FR 31375 (June 9, 1997)) (Advance Notice), seeking
comment on whether it should propose rules to lift the prohibition on
trade options on the enumerated agricultural options subject to
conditions and, if so, what conditions would be appropriate. The
comment period will remain open until July 24, 1997. Id.
    As the Commission noted in its Advance Notice, it directed its
Division of Economic Analysis (Division) to study the prohibition on
the offer or sale of off-exchange trade options on the agricultural
commodities enumerated in the Act and to report on the Division's
findings. On May 14, 1997, the Division forwarded to the Commission its
study entitled, ``Policy Alternatives Relating to Agricultural Trade
Options and Other Agricultural Risk-Shifting Contracts.'' The complete
text of that study is available through the Commission's Internet site
and can be accessed at http://www.cftc.gov/ag8.htm.
    The Advance Notice poses a number of questions for comment relating
to the issues identified in the Division's study. These issues include,
among others, the nature of possible conditions on lifting the
prohibition on agricultural trade options. Such conditions relate to
the nature of the parties, restrictions on the instruments or their
use, the regulation of their marketing and other possible limitations
relating to financial capacity, cover, and internal controls.
    The Commission is of the view that, in addition to the receipt of
written comments, an opportunity for interested members of the public
to appear before it will assist it in its consideration of these issues
and is in the public interest. Accordingly, the Commission will convene
public meetings on July 10th in Bloomington, Illinois, and on July
16th, in Memphis, Tennessee, for that purpose.
    All individuals or organizations wishing to appear before the
Commission should submit to the Commission at the above address by July
1, 1997, a concise statement of interest and qualifications and a brief
summary or abstract of the content of his or her statement. The
Commission will invite a representative number of individuals or
organizations to appear from those submitting such statements. Persons
appearing before the Commission are invited specifically to address the
questions posed by the Commission in its Advance Notice. A
transcription of the meetings will be made and entered into the
Commission's public comment files, which as noted above, will remain
open for the receipt of written comment until July 24, 1997.

    Issued in Washington, DC, this 16th day of June 1997 by the
Commodity Futures Trading Commission.
Jean A. Webb,
Secretary of the Commission.
[FR Doc. 97-16073 Filed 6-18-97; 8:45 am]

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