For Release: July 15, 1998
CFTC Proposes Further Streamlining of Contract
Washington, D.C. -- The Commodity Futures Trading Commission (Commission) continues its regulatory reform by proposing further streamlining of the process for contract market designation. The Commission reviews all contracts proposed by U.S. futures exchanges before they begin trading for compliance with the Commodity Exchange Act and Commission rules and to help ensure that proposed contracts would not be readily susceptible to price manipulation. In 1997 the Commission substantially streamlined the review process by adopting fast-track approval rules. Under the fast-track procedures, several categories of contracts are deemed approved in as few as ten days of their submission, while other categories are deemed approved within forty-five days.
The current proposal would further streamline the designation process by revising the requirements for the designation application and is intended to reduce any unnecessary burdens associated with the application process. Specifically, the Commission is proposing revisions to its Guideline on Economic and Public Interest Requirements for Contract Market Designation, 17 C.F.R. Part 5, Appendix A (Guideline No. 1). Guideline No. 1 details the information that an application for contract market designation should include in order to demonstrate that the contract market meets the economic requirements for designation. The Commission is proposing to reorganize Guideline No. 1 into several specific application forms, making use to the extent possible of a checklist or chart format. This new format is intended to clarify the requirements for contract approval and should result in savings by futures exchanges in the costs associated with applying for contract approval.
The Commission's proposal will be published in the Federal Register shortly and comments must be received within 60 days of its publication. Copies of the proposal may be obtained by contacting the Commission's Office of the Secretariat, Three Lafayette Centre, 1155 21st Street, N.W., Washington, D.C., 20581, (202) 418-5100, or by accessing the Commission's website, www.cftc.gov..