Opening Statement by Commissioner Jill Sommers, Joint Meeting of the Commodity Futures Trading Commission and the Securities and Exchange Commission on Harmonization of Regulation

September 2, 2009

We have a lot to get through today so I will be brief. The CFTC and the SEC have been asked to identify conflicts in how the two agencies regulate similar financial products and to either explain why those differences further important policy goals, or make recommendations for resolving differences where they do not. As many have observed, futures markets—used primarily to manage risk and discover prices, and equities markets—used primarily to raise capital for public companies, serve fundamentally different purposes. A futures contract on corn and a share of IBM stock are not similar financial products. Certain structural differences in how these markets operate necessarily require operationally divergent regulatory schemes. That being said, there is a growing list of derivatives products that straddle jurisdictional lines. I share the frustrations of those who complain that our inability to resolve jurisdictional disputes or harmonize our regulatory approach for these products creates capital inefficiencies and delays in bringing beneficial financial tools to the marketplace. I am hopeful that our joint meetings today and tomorrow will lead to some real progress and look forward to the discussion.

Last Updated: June 11, 2010