Release: #4100-98

For Release: January 22, 1998

CFTC Seeks Public Comment on the Regulation of Noncompetitive Transactions Executed on or Subject to the Rules of an Exchange

Washington, D.C. -- The Commodity Futures Trading Commission is reevaluating its approach to the regulation of noncompetitive transactions executed on or subject to the rules of an exchange. Accordingly, the Commission is issuing a Concept Release seeking public comments on a broad range of questions concerning the oversight of noncompetitive transactions that are currently permitted, such as the exchange of futures contracts for physicals (EFPs), as well as those transactions that are not currently permitted, such as the exchange of futures contracts for swap agreements (EFS transactions), the exchange of options contracts for physicals (EOPs) and other noncompetitive off-floor trading. Among other things, the Commission is seeking input on the appropriate scope of regulatory requirements concerning reporting and recordkeeping, disclosure, internal controls, transparency and the prevention of fraud and manipulation. In addition, the Commission is soliciting comments on the use of execution facilities for noncompetitive transactions.

The Commission expects the Concept Release to be published in the Federal Register next week and has provided a 60-day comment period. The release will be available on the Commission's Internet Home Page ( and also may be obtained by contacting the Office of the Secretariat, Three Lafayette Centre, 1155 21st Street, N.W., Washington, D.C. 20581, (202) 418-5100.