Release: #3967-96

For Release: November 19, 1996

CFTC Proposes to Amend Procedures Relating to its Review and Approval of Applications for Contract Market Designation

Chairperson Brooksley Born today announced that the Commission is proposing to amend its procedures relating to its review and approval of applications for contract market designation and proposed exchange rules relating to contract terms and conditions. These proposed amendments will be published shortly in the Federal Register for public comment.

The proposed amendments would create an alternative review and approval procedure intended further to streamline Commission review of applications for contract market designation and proposed exchange rule amendments of contract terms and conditions. These fast-track procedures are intended to create a mechanism whereby new contract designations or amendments to contract terms which do not raise novel or complex issues can be approved automatically after an abbreviated review period--for some cash-settled contracts, in as few as ten days. Other types of contracts could receive expedited reviews in a period of forty-five days. These periods could be extended for an additional thirty days. Applications which appear not to be in compliance with the Commodity Exchange Act or Commission rules could be amended or subject to formal disapproval proceedings, at the election of the exchange.

In announcing this proposal, Chairperson Born stated that:

"I hope that the Commission's proposed fast-track procedures will provide exchanges greater certainty and ease in listing new products while maintaining the Commission's authority to review such products and preserving the public's ability to participate in the process. This is an important first step in our efforts."