FOR RELEASE: April 12, 1996
Acting Chairman John E. Tull, Jr. is pleased to report that, as of March 31, 1996, half-way through fiscal year 1996, the Commission has approved 67 new contracts, including 32 new futures contracts and 35 new option contracts. This total surpasses the previous record for an entire fiscal year of 48 contracts. The record number of new contract approvals reflects a surge in US exchanges' product-development efforts, representing innovative products in new commodity areas, such as electricity and the debt of emerging markets, as well as new approaches to trading in the more traditional agricultural and financial sectors and was made possible by a highly successful commitment by the Commission to streamline and re-engineer its review and approval processes.
Aware that the U.S. regulatory system must be responsive to market changes for the US futures and option markets to remain competitively robust, the Commission has attempted to facilitate U.S. exchange innovation and reduce the costs of regulation without reducing its commitment to maintaining the integrity of the futures and options markets and to customer protection . Toward both of these ends, in the early 1990s, the Commission began a program of streamlining its contract review and approval procedures. This program removed duplication of effort between the Commission and the exchanges, reduced paperwork and fees, and expedited generally the approval process, enabling the Commission to focus its resources more efficiently on the ultimate objective: assessment of a proposed contract's susceptibility to manipulation. These improvements were made at the same time that the Commission reduced the staff resources devoted to this function.
As a result of these efforts, the average processing time for applications for contract market designation has fallen by more than half since the program began. In addition, the backlog of pending contracts has been eliminated; new applications now are being considered promptly upon submission. Most significantly, even though the number of new contracts submitted this year is at a record level, the average review time for processing this unprecedented number of new contracts has remained at about three months, with no additional staff resources assigned.
Acting Chairman Tull stated that, "I am pleased to see that the sustained efforts of the Commission to improve and streamline its review of applications for new contract market designations has been successful. As a result of these efforts, exchanges are able to introduce new products faster, enabling them better to compete. At the same time, the Commission has continued to adhere to the same high standards in its review of new contract applications, and has done so with fewer staff resources. This is but one illustration of the Commission's overall commitment to assure the continued integrity of the markets and the protection of customers in the most efficient manner possible."