For Release:April 15, 1997

Exemption for CPOs of Certain Publicly Offered Pools from Rule 4.26(B) Requirement to Deliver the Most Recent Annual Report together with the Pool's Disclosure Document

By letter dated February 27, 1997, the Division of Trading and Markets (Division) of the Commodity Futures Trading Commission (the Commission) exempted registered commodity pool operators (CPOs) of certain publicly offered pools from the requirement of Commission Rule 4.26(b) to provide a copy of the pool's most recent Annual Report to a prospective pool participant at the same time that the CPO delivers the pool's Disclosure Document. The exemptive relief was sought by the Managed Futures Association (MFA) in order to reduce the paperwork and expense involved in complying with both Commission and federal securities laws and regulations in connection with a public offering of commodity pool units made pursuant to an effective registration statement under the Securities Act of 1933 (the Securities Act).

In order for a CPO to be eligible for the exemption provided by the letter, units of participation in the pool must be offered and sold pursuant to an effective registration statement under the Securities Act, and the pool must be subject to the reporting requirements of the Securities Exchange Act of 1934. The availability of the relief is also expressly conditioned upon compliance with the following requirements:

1.Inclusion in the pool's monthly Account Statement (delivered with the Disclosure Document) of any material information contained in, or required to be contained in, the Annual Report (including any material change from the most recent audited financial statements);

2.Availability to prospective and existing pool participants of the pool's net asset value per unit (as of the close of the previous business day) from the CPO or from the broker marketing pool units (and disclosure of such availability in the pool's Disclosure Document and/or its monthly Account Statement);

3.Availability of a paper copy of the most recent Annual Report to any prospective pool participant upon request;

4.Delivery of a copy of the pool's most recent Annual Report within twenty-one days following a participant's purchase of a pool unit; and

5.Inclusion in the pool's organizational documents of a provision for redemption no less frequently than monthly.

Copies of the Division's February 27, 1997, letter may be obtained from the Commission's Office of the Secretariat, (202) 418-5100.