-CITE-
    7 USC CHAPTER 1 - COMMODITY EXCHANGES                       01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
                      CHAPTER 1 - COMMODITY EXCHANGES                  

-MISC1-
    Sec.                                                     
    1.          Short title.                                          
    1a.         Definitions.                                          
    2.          Jurisdiction of Commission; liability of principal for
                 act of agent; Commodity Futures Trading Commission;
                 transaction in interstate commerce.                  
    2a to 4a.   Transferred.                                          
    5.          Findings and purpose.                                 
    6.          Regulation of futures trading and foreign
                 transactions.                                        
    6a.         Excessive speculation.                                
    6b.         Fraud, false reporting, or deception prohibited.      
    6c.         Prohibited transactions.                              
    6d.         Dealing by unregistered futures commission merchants
                 or introducing brokers prohibited; duties in handling
                 customer receipts; rules to avoid duplicative
                 regulations.                                         
    6e.         Dealings by unregistered floor trader or broker
                 prohibited.                                          
    6f.         Registration and financial requirements; risk
                 assessment.                                          
    6g.         Reporting and recordkeeping.                          
    6h.         False self-representation as registered entity member
                 prohibited.                                          
    6i.         Reports of deals equal to or in excess of trading
                 limits; books and records; cash and controlled
                 transactions.                                        
    6j.         Restrictions on dual trading in security futures
                 products on designated contract markets and
                 registered derivatives transaction execution
                 facilities.                                          
    6k          Registration of associates of futures commission
                 merchants, commodity pool operators, and commodity
                 trading advisors; required disclosure of
                 disqualifications; exemptions for associated persons.
    6l.         Commodity trading advisors and commodity pool
                 operators; Congressional finding.                    
    6m.         Use of mails or other means or instrumentalities of
                 interstate commerce by commodity trading advisors and
                 commodity pool operators; relation to other law.     
    6n.         Registration of commodity trading advisors and
                 commodity pool operators; application; expiration and
                 renewal; record keeping and reports; disclosure;
                 statements of account.                               
    6o.         Fraud and misrepresentation by commodity trading
                 advisors, commodity pool operators, and associated
                 persons.                                             
    6o-1.       Special procedures to encourage and facilitate bona
                 fide hedging by agricultural producers.              
    6p.         Standards and examinations.                           
    7.          Designation of boards of trade as contract markets.   
    7a.         Derivatives transaction execution facilities.         
    7a-1.       Derivatives clearing organizations.                   
    7a-2.       Common provisions applicable to registered entities.  
    7a-3.       Exempt boards of trade.                               
    7b.         Suspension or revocation of designation as registered
                 entity.                                              
    7b-1.       Designation of securities exchanges and associations
                 as contract markets.                                 
    7b-2.       Privacy.                                              
    8.          Application for designation as contract market or
                 derivatives transaction execution facility; time;
                 suspension or revocation of designation; hearing;
                 review by court of appeals.                          
    9.          Exclusion of persons from privilege of "registered
                 entities"; procedure for exclusion; review by court
                 of appeals.                                          
    9a.         Assessment of money penalties.                        
    9b.         Rules prohibiting deceptive and other abusive
                 telemarketing acts or practices.                     
    9c.         Notice of investigations and enforcement actions.     
    10.         Repealed.                                             
    10a.        Cooperative associations and corporations, exclusion
                 from board of trade; rules of board inapplicable to
                 payment of compensation by association.              
    11.         Vacation on request of designation or registration as
                 "registered entity"; redesignation or reregistration.
    12.         Public disclosure.                                    
    12-1 to 12-3. Omitted.                                            
    12a.        Registration of commodity dealers and associated
                 persons; regulation of registered entities.          
    12b.        Trading ban violations; prohibition.                  
    12c.        Disciplinary actions.                                 
    12d.        Commission action for noncompliance with export sales
                 reporting requirements.                              
    12e.        Repealed.                                             
    13.         Violations generally; punishment; costs of
                 prosecution.                                         
    13-1.       Violations, prohibition against dealings in onion
                 futures; punishment.                                 
    13a.        Nonenforcement of rules of government or other
                 violations; cease and desist orders; fines and
                 penalties; imprisonment; misdemeanor; separate
                 offenses.                                            
    13a-1.      Enjoining or restraining violations.                  
    13a-2.      Jurisdiction of States.                               
    13b.        Manipulations or other violations; cease and desist
                 orders against persons other than registered
                 entities; punishment; misdemeanor or felony; separate
                 offenses.                                            
    13c.        Responsibility as principal; minor violations.        
    14.         Repealed.                                             
    15.         Enforcement powers of Commission.                     
    15a.        Repealed.                                             
    15b.        Cotton futures contracts.                             
    16.         Commission operations.                                
    16a.        Service fees and National Futures Association study.  
    17.         Separability.                                         
    17a.        Separability of 1936 amendment.                       
    17b.        Separability of 1968 amendment.                       
    18.         Complaints against registered persons.                
    19.         Consideration of costs and benefits and antitrust
                 laws.                                                
    20.         Market reports.                                       
    21.         Registered futures associations.                      
    22.         Research and information programs; reports to
                 Congress.                                            
    23.         Standardized contracts for certain commodities.       
    24.         Regulations respecting commodity broker debtors;
                 definitions.                                         
    25.         Private rights of action.                             
    26.         Repealed.                                             
    27.         Definitions.                                          
    27a.        Exclusion of identified banking products commonly
                 offered on or before December 5, 2000.               
    27b.        Exclusion of certain identified banking products
                 offered by banks after December 5, 2000.             
    27c.        Exclusion of certain other identified banking
                 products.                                            
    27d.        Administration of the predominance test.              
    27e.        Exclusion of covered swap agreements.                 
    27f.        Contract enforcement.                                 

-End-

-CITE-
    7 USC Sec. 1                                                01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 1. Short title

-STATUTE-
      This chapter may be cited as the "Commodity Exchange Act."

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 1, 42 Stat. 998; June 15, 1936, ch.
    545, Sec. 1, 49 Stat. 1491.)

-MISC1-
                             PRIOR PROVISIONS                         
      This chapter superseded act Aug. 24, 1921, ch. 86, 42 Stat. 187,
    known as "The Future Trading Act," which act was declared
    unconstitutional, at least in part, in Hill v. Wallace, Ill. 1922,
    42 S.Ct. 453, 259 U.S. 44, 66 L.Ed. 822. Section 3 of that act was
    found unconstitutional as imposing a penalty in Trusler v. Crooks,
    Mo. 1926, 46 S.Ct. 165, 269 U.S. 475, 70 L.Ed. 365.

                                AMENDMENTS                            
      1936 - Act June 15, 1936, substituted "Commodity Exchange Act"
    for "The Grain Futures Act".

                     EFFECTIVE DATE OF 1936 AMENDMENT                 
      Section 13 of act June 15, 1936, provided that: "All provisions
    of this Act [see Tables for classification] authorizing the
    registration of futures commission merchants and floor brokers, the
    fixing of fees and charges therefor, the promulgation of rules,
    regulations and orders, and the holding of hearings precedent to
    the promulgation of rules, regulations, and orders shall be
    effective immediately. All other provisions of this Act shall take
    effect ninety days after the enactment of this Act [June 15,
    1936]."

                       SHORT TITLE OF 2000 AMENDMENT                   
      Pub. L. 106-554, Sec. 1(a)(5) [Sec. 1(a)], Dec. 21, 2000, 114
    Stat. 2763, 2763A-365, provided that: "This Act [H.R. 5660, as
    enacted by section 1(a)(5) of Pub. L. 106-554, enacting sections 5,
    6o-1, 7 to 7a-3, 7b-1, 7b-2, 9c, and 27 to 27f of this title,
    sections 781 to 784 of Title 11, Bankruptcy, sections 339a, 4421,
    and 4422 of Title 12, Banks and Banking, and sections 77b-1 and 78c-
    1 of Title 15, Commerce and Trade, amending sections 1a, 2, 2a, 4,
    4a, 6 to 6m, 6p, 7a-2, 7b, 8 to 9a, 10a, 11, 12, 12a to 12c, 13,
    13a to 13b, 16, 18 to 21, and 25 of this title, sections 101, 103,
    109, and 761 of Title 11, sections 624 and 4402 of Title 12, and
    sections 77b, 77c, 77l, 77q, 78c, 78f, 78g, 78i, 78j, 78k-1, 78l,
    78o, 78o-3, 78p, 78q, 78q-1, 78s, 78t, 78u, 78u-1, 78bb, 78ee,
    78ccc, 78lll, 80a-2, 80b-2, and 80b-3 of Title 15, repealing
    sections 5, 7, 7a, and 12e of this title, and enacting provisions
    set out as notes under this section, section 2 of this title, and
    section 78c of Title 15] may be cited as the 'Commodity Futures
    Modernization Act of 2000'."
      Pub. L. 106-554, Sec. 1(a)(5) [title IV, Sec. 401], Dec. 21,
    2000, 114 Stat. 2763, 2763A-457, provided that: "This title [title
    IV of H.R. 5660, as enacted by section 1(a)(5) of Pub. L. 106-554,
    enacting sections 27 to 27f of this title] may be cited as the
    'Legal Certainty for Bank Products Act of 2000'."

                       SHORT TITLE OF 1995 AMENDMENT                   
      Pub. L. 104-9, Sec. 1, Apr. 21, 1995, 109 Stat. 154, provided
    that: "This Act [amending section 16 of this title] may be cited as
    the 'CFTC Reauthorization Act of 1995'."

                       SHORT TITLE OF 1992 AMENDMENT                   
      Pub. L. 102-546, Sec. 1(a), Oct. 28, 1992, 106 Stat. 3590,
    provided that: "This Act [enacting sections 1a and 12e of this
    title, amending sections 2, 2a, 4, 4a, 6 to 6c, 6e to 6g, 6j, 6p, 7
    to 9a, 10a, 12, 12a, 12c, 13 to 13c, 15, 16, 18, 19, 21, and 25 of
    this title, repealing section 26 of this title, enacting provisions
    set out as notes under sections 1a, 4a, 6c, 6e, 6j, 6p, 7a, 13,
    16a, 21, and 22 of this title, and repealing provisions set out as
    a note under section 4a of this title] may be cited as the 'Futures
    Trading Practices Act of 1992'."

                       SHORT TITLE OF 1986 AMENDMENT                   
      Pub. L. 99-641, Sec. 1, Nov. 10, 1986, 100 Stat. 3556, provided
    that: "This Act [enacting section 2271a of this title, amending
    sections 2a, 6b, 6c, 7a, 13, 13a-1, 15, 16, 21, 23, 74, 87b, 1444,
    1445b-3, and 1445c-2 of this title, sections 590h and 3831 of Title
    16, Conservation, sections 606, 609, 621, 671, and 676 of Title 21,
    Food and Drugs, repealing section 14 of this title, and enacting
    provisions set out as notes under sections 20, 71, 76, 87b, and
    2271a of this title and sections 601, 606, 609, 621, 671, and 676
    of Title 21] may be cited as the 'Futures Trading Act of 1986'."

                       SHORT TITLE OF 1983 AMENDMENT                   
      Pub. L. 97-444, Sec. 1, Jan. 11, 1983, 96 Stat. 2294, provided:
    "That this Act [enacting sections 2a, 12d, 25, and 26 of this
    title, amending sections 2, 4, 4a, 5, 6, 6a, 6c, 6d, 6f, 6g, 6h,
    6i, 6k, 6m, 6n, 6o, 6p, 7a, 8, 9, 12, 12a, 13, 13a-1, 13a-2, 13c,
    16, 16a, 18, 20, 21, 23, and 612c-3 of this title, and enacting
    provisions set out as a note under section 2 of this title] may be
    cited as the 'Futures Trading Act of 1982'."

                       SHORT TITLE OF 1978 AMENDMENT                   
      Pub. L. 95-405, Sec. 1, Sept. 30, 1978, 92 Stat. 865, provided:
    "That this Act [enacting sections 13a-2, 16a, and 23 of this title,
    amending sections 2, 4a, 6c, 6d, 6f, 6g, 6k, 6m, 6n, 6o, 7a, 8, 12,
    12a, 12c, 13, 13a, 15, 16, 18, and 21 of this title and section
    6001 of Title 18, Crimes and Criminal Procedure, repealing section
    15a of this title, omitting sections 12-1 to 12-3 of this title,
    and enacting provisions set out as notes under sections 2 and 20 of
    this title] may be cited as the 'Futures Trading Act of 1978'."

                       SHORT TITLE OF 1974 AMENDMENT                   
      Pub. L. 93-463, Sec. 1, Oct. 23, 1974, 88 Stat. 1389, provided:
    "That this Act [enacting sections 4a, 6j, 6k, 6l, 6m, 6n, 6o, 6p,
    9a, 12-2, 13-3, 12c, 13a-1, 15a, 18, 19, 20, 21, and 22 of this
    title, amending sections 2, 4, 6, 6a, 6b, 6c, 6d, 6e, 6f, 6g, 6i,
    7, 7a, 7b, 8, 9, 11, 12, 12-1, 12a, 12b, 13, 13a, 13b, 13c, 15, and
    16 of this title and sections 5314, 5315, 5316, and 5108 of Title
    5, Government Organization and Employees, and enacting provisions
    set out as notes under sections 2, 4a, and 6a of this title] may be
    cited as the 'Commodity Futures Trading Commission Act of 1974'."

                   SAVINGS PROVISIONS FOR 2000 AMENDMENT               
      Pub. L. 106-554, Sec. 1(a)(5) [title III, Sec. 304], Dec. 21,
    2000, 114 Stat. 2763, 2763A-457, provided that: "Nothing in this
    Act [see Short Title of 2000 Amendment note above] or the
    amendments made by this Act shall be construed as finding or
    implying that any swap agreement is or is not a security for any
    purpose under the securities laws. Nothing in this Act or the
    amendments made by this Act shall be construed as finding or
    implying that any swap agreement is or is not a futures contract or
    commodity option for any purpose under the Commodity Exchange Act
    [7 U.S.C. 1 et seq.]."

                      CONSTRUCTION OF 2000 AMENDMENT                  
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 122], Dec. 21, 2000,
    114 Stat. 2763, 2763A-405, provided that: "Except as expressly
    provided in this Act [see Short Title of 2000 Amendment note above]
    or an amendment made by this Act, nothing in this Act or an
    amendment made by this Act supersedes, affects, or otherwise limits
    or expands the scope and applicability of laws governing the
    Securities and Exchange Commission."

                        PURPOSES OF 2000 AMENDMENT                    
      Pub. L. 106-554, Sec. 1(a)(5) [Sec. 2], Dec. 21, 2000, 114 Stat.
    2763, 2763A-366, provided that:
      "The purposes of this Act [see Short Title of 2000 Amendment note
    above] are - 
        "(1) to reauthorize the appropriation for the Commodity Futures
      Trading Commission;
        "(2) to streamline and eliminate unnecessary regulation for the
      commodity futures exchanges and other entities regulated under
      the Commodity Exchange Act [7 U.S.C. 1 et seq.];
        "(3) to transform the role of the Commodity Futures Trading
      Commission to oversight of the futures markets;
        "(4) to provide a statutory and regulatory framework for
      allowing the trading of futures on securities;
        "(5) to clarify the jurisdiction of the Commodity Futures
      Trading Commission over certain retail foreign exchange
      transactions and bucket shops that may not be otherwise
      regulated;
        "(6) to promote innovation for futures and derivatives and to
      reduce systemic risk by enhancing legal certainty in the markets
      for certain futures and derivatives transactions;
        "(7) to reduce systemic risk and provide greater stability to
      markets during times of market disorder by allowing the clearing
      of transactions in over-the-counter derivatives through
      appropriately regulated clearing organizations; and
        "(8) to enhance the competitive position of United States
      financial institutions and financial markets."

                            REPORT TO CONGRESS                        
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 125], Dec. 21, 2000,
    114 Stat. 2763, 2763A-411, provided that:
      "(a) The Commodity Futures Trading Commission (in this section
    referred to as the 'Commission') shall undertake and complete a
    study of the Commodity Exchange Act [7 U.S.C. 1 et seq.] (in this
    section referred to as 'the Act') and the Commission's rules,
    regulations and orders governing the conduct of persons required to
    be registered under the Act, not later than 1 year after the date
    of the enactment of this Act [Dec. 21, 2000]. The study shall
    identify - 
        "(1) the core principles and interpretations of acceptable
      business practices that the Commission has adopted or intends to
      adopt to replace the provisions of the Act and the Commission's
      rules and regulations thereunder;
        "(2) the rules and regulations that the Commission has
      determined must be retained and the reasons therefor;
        "(3) the extent to which the Commission believes it can effect
      the changes identified in paragraph (1) of this subsection
      through its exemptive authority under section 4(c) of the Act [7
      U.S.C. 6(c)]; and
        "(4) the regulatory functions the Commission currently performs
      that can be delegated to a registered futures association (within
      the meaning of the Act) and the regulatory functions that the
      Commission has determined must be retained and the reasons
      therefor.
      "(b) In conducting the study, the Commission shall solicit the
    views of the public as well as Commission registrants, registered
    entities, and registered futures associations (all within the
    meaning of the Act).
      "(c) The Commission shall transmit to the Committee on
    Agriculture of the House of Representatives and the Committee on
    Agriculture, Nutrition, and Forestry of the Senate a report of the
    results of its study, which shall include an analysis of comments
    received."

-End-

-CITE-
    7 USC Sec. 1a                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 1a. Definitions

-STATUTE-
      As used in this chapter:
      (1) Alternative trading system
        The term "alternative trading system" means an organization,
      association, or group of persons that - 
          (A) is registered as a broker or dealer pursuant to section
        15(b) of the Securities Exchange Act of 1934 [15 U.S.C. 78o(b)]
        (except paragraph (11) thereof);
          (B) performs the functions commonly performed by an exchange
        (as defined in section 3(a)(1) of the Securities Exchange Act
        of 1934 [15 U.S.C. 78c(a)(1)]);
          (C) does not - 
            (i) set rules governing the conduct of subscribers other
          than the conduct of such subscribers' trading on the
          alternative trading system; or
            (ii) discipline subscribers other than by exclusion from
          trading; and

          (D) is exempt from the definition of the term "exchange"
        under such section 3(a)(1) [15 U.S.C. 78c(a)(1)] by rule or
        regulation of the Securities and Exchange Commission on terms
        that require compliance with regulations of its trading
        functions.
      (2) Board of trade
        The term "board of trade" means any organized exchange or other
      trading facility.
      (3) Commission
        The term "Commission" means the Commodity Futures Trading
      Commission established under section 2(a)(2) of this title.
      (4) Commodity
        The term "commodity" means wheat, cotton, rice, corn, oats,
      barley, rye, flaxseed, grain sorghums, mill feeds, butter, eggs,
      Solanum tuberosum (Irish potatoes), wool, wool tops, fats and
      oils (including lard, tallow, cottonseed oil, peanut oil, soybean
      oil, and all other fats and oils), cottonseed meal, cottonseed,
      peanuts, soybeans, soybean meal, livestock, livestock products,
      and frozen concentrated orange juice, and all other goods and
      articles, except onions as provided in section 13-1 of this
      title, and all services, rights, and interests in which contracts
      for future delivery are presently or in the future dealt in.
      (5) Commodity pool operator
        The term "commodity pool operator" means any person engaged in
      a business that is of the nature of an investment trust,
      syndicate, or similar form of enterprise, and who, in connection
      therewith, solicits, accepts, or receives from others, funds,
      securities, or property, either directly or through capital
      contributions, the sale of stock or other forms of securities, or
      otherwise, for the purpose of trading in any commodity for future
      delivery on or subject to the rules of any contract market or
      derivatives transaction execution facility, except that the term
      does not include such persons not within the intent of the
      definition of the term as the Commission may specify by rule,
      regulation, or order.
      (6) Commodity trading advisor
        (A) In general
          Except as otherwise provided in this paragraph, the term
        "commodity trading advisor" means any person who - 
            (i) for compensation or profit, engages in the business of
          advising others, either directly or through publications,
          writings, or electronic media, as to the value of or the
          advisability of trading in - 
              (I) any contract of sale of a commodity for future
            delivery made or to be made on or subject to the rules of a
            contract market or derivatives transaction execution
            facility;
              (II) any commodity option authorized under section 6c of
            this title; or
              (III) any leverage transaction authorized under section
            23 of this title; or

            (ii) for compensation or profit, and as part of a regular
          business, issues or promulgates analyses or reports
          concerning any of the activities referred to in clause (i).
        (B) Exclusions
          Subject to subparagraph (C), the term "commodity trading
        advisor" does not include - 
            (i) any bank or trust company or any person acting as an
          employee thereof;
            (ii) any news reporter, news columnist, or news editor of
          the print or electronic media, or any lawyer, accountant, or
          teacher;
            (iii) any floor broker or futures commission merchant;
            (iv) the publisher or producer of any print or electronic
          data of general and regular dissemination, including its
          employees;
            (v) the fiduciary of any defined benefit plan that is
          subject to the Employee Retirement Income Security Act of
          1974 (29 U.S.C. 1001 et seq.);
            (vi) any contract market or derivatives transaction
          execution facility; and
            (vii) such other persons not within the intent of this
          paragraph as the Commission may specify by rule, regulation,
          or order.
        (C) Incidental services
          Subparagraph (B) shall apply only if the furnishing of such
        services by persons referred to in subparagraph (B) is solely
        incidental to the conduct of their business or profession.
        (D) Advisors
          The Commission, by rule or regulation, may include within the
        term "commodity trading advisor", any person advising as to the
        value of commodities or issuing reports or analyses concerning
        commodities if the Commission determines that the rule or
        regulation will effectuate the purposes of this paragraph.
      (7) Contract of sale
        The term "contract of sale" includes sales, agreements of sale,
      and agreements to sell.
      (8) Cooperative association of producers
        The term "cooperative association of producers" means any
      cooperative association, corporate, or otherwise, not less than
      75 percent in good faith owned or controlled, directly or
      indirectly, by producers of agricultural products and otherwise
      complying with sections 291 and 292 of this title, including any
      organization acting for a group of such associations and owned or
      controlled by such associations, except that business done for or
      with the United States, or any agency thereof, shall not be
      considered either member or nonmember business in determining the
      compliance of any such association with this chapter.
      (9) Derivatives clearing organization
        (A) In general
          The term "derivatives clearing organization" means a
        clearinghouse, clearing association, clearing corporation, or
        similar entity, facility, system, or organization that, with
        respect to an agreement, contract, or transaction - 
            (i) enables each party to the agreement, contract, or
          transaction to substitute, through novation or otherwise, the
          credit of the derivatives clearing organization for the
          credit of the parties;
            (ii) arranges or provides, on a multilateral basis, for the
          settlement or netting of obligations resulting from such
          agreements, contracts, or transactions executed by
          participants in the derivatives clearing organization; or
            (iii) otherwise provides clearing services or arrangements
          that mutualize or transfer among participants in the
          derivatives clearing organization the credit risk arising
          from such agreements, contracts, or transactions executed by
          the participants.
        (B) Exclusions
          The term "derivatives clearing organization" does not include
        an entity, facility, system, or organization solely because it
        arranges or provides for - 
            (i) settlement, netting, or novation of obligations
          resulting from agreements, contracts, or transactions, on a
          bilateral basis and without a central counterparty;
            (ii) settlement or netting of cash payments through an
          interbank payment system; or
            (iii) settlement, netting, or novation of obligations
          resulting from a sale of a commodity in a transaction in the
          spot market for the commodity.
      (10) Electronic trading facility
        The term "electronic trading facility" means a trading facility
      that - 
          (A) operates by means of an electronic or telecommunications
        network; and
          (B) maintains an automated audit trail of bids, offers, and
        the matching of orders or the execution of transactions on the
        facility.
      (11) Eligible commercial entity
        The term "eligible commercial entity" means, with respect to an
      agreement, contract or transaction in a commodity - 
          (A) an eligible contract participant described in clause (i),
        (ii), (v), (vii), (viii), or (ix) of paragraph (12)(A) that, in
        connection with its business - 
            (i) has a demonstrable ability, directly or through
          separate contractual arrangements, to make or take delivery
          of the underlying commodity;
            (ii) incurs risks, in addition to price risk, related to
          the commodity; or
            (iii) is a dealer that regularly provides risk management
          or hedging services to, or engages in market-making
          activities with, the foregoing entities involving
          transactions to purchase or sell the commodity or derivative
          agreements, contracts, or transactions in the commodity;

          (B) an eligible contract participant, other than a natural
        person or an instrumentality, department, or agency of a State
        or local governmental entity, that - 
            (i) regularly enters into transactions to purchase or sell
          the commodity or derivative agreements, contracts, or
          transactions in the commodity; and
            (ii) either - 
              (I) in the case of a collective investment vehicle whose
            participants include persons other than - 
                (aa) qualified eligible persons, as defined in
              Commission rule 4.7(a) (17 CFR 4.7(a));
                (bb) accredited investors, as defined in Regulation D
              of the Securities and Exchange Commission under the
              Securities Act of 1933 [15 U.S.C. 77a et seq.] (17 CFR
              230.501(a)), with total assets of $2,000,000; or
                (cc) qualified purchasers, as defined in section
              2(a)(51)(A) of the Investment Company Act of 1940 [15
              U.S.C. 80a-2(a)(51)(A)];

            in each case as in effect on December 21, 2000, has, or is
            one of a group of vehicles under common control or
            management having in the aggregate, $1,000,000,000 in total
            assets; or
              (II) in the case of other persons, has, or is one of a
            group of persons under common control or management having
            in the aggregate, $100,000,000 in total assets; or

          (C) such other persons as the Commission shall determine
        appropriate and shall designate by rule, regulation, or order.
      (12) Eligible contract participant
        The term "eligible contract participant" means - 
          (A) acting for its own account - 
            (i) a financial institution;
            (ii) an insurance company that is regulated by a State, or
          that is regulated by a foreign government and is subject to
          comparable regulation as determined by the Commission,
          including a regulated subsidiary or affiliate of such an
          insurance company;
            (iii) an investment company subject to regulation under the
          Investment Company Act of 1940 (15 U.S.C. 80a-1 et seq.) or a
          foreign person performing a similar role or function subject
          as such to foreign regulation (regardless of whether each
          investor in the investment company or the foreign person is
          itself an eligible contract participant);
            (iv) a commodity pool that - 
              (I) has total assets exceeding $5,000,000; and
              (II) is formed and operated by a person subject to
            regulation under this chapter or a foreign person
            performing a similar role or function subject as such to
            foreign regulation (regardless of whether each investor in
            the commodity pool or the foreign person is itself an
            eligible contract participant);

            (v) a corporation, partnership, proprietorship,
          organization, trust, or other entity - 
              (I) that has total assets exceeding $10,000,000;
              (II) the obligations of which under an agreement,
            contract, or transaction are guaranteed or otherwise
            supported by a letter of credit or keepwell, support, or
            other agreement by an entity described in subclause (I), in
            clause (i), (ii), (iii), (iv), or (vii), or in subparagraph
            (C); or
              (III) that - 
                (aa) has a net worth exceeding $1,000,000; and
                (bb) enters into an agreement, contract, or transaction
              in connection with the conduct of the entity's business
              or to manage the risk associated with an asset or
              liability owned or incurred or reasonably likely to be
              owned or incurred by the entity in the conduct of the
              entity's business;

            (vi) an employee benefit plan subject to the Employee
          Retirement Income Security Act of 1974 (29 U.S.C. 1001 et
          seq.), a governmental employee benefit plan, or a foreign
          person performing a similar role or function subject as such
          to foreign regulation - 
              (I) that has total assets exceeding $5,000,000; or
              (II) the investment decisions of which are made by - 
                (aa) an investment adviser or commodity trading advisor
              subject to regulation under the Investment Advisers Act
              of 1940 (15 U.S.C. 80b-1 et seq.) or this chapter;
                (bb) a foreign person performing a similar role or
              function subject as such to foreign regulation;
                (cc) a financial institution; or
                (dd) an insurance company described in clause (ii), or
              a regulated subsidiary or affiliate of such an insurance
              company;

            (vii)(I) a governmental entity (including the United
          States, a State, or a foreign government) or political
          subdivision of a governmental entity;
            (II) a multinational or supranational government entity; or
            (III) an instrumentality, agency, or department of an
          entity described in subclause (I) or (II);

          except that such term does not include an entity,
          instrumentality, agency, or department referred to in
          subclause (I) or (III) of this clause unless (aa) the entity,
          instrumentality, agency, or department is a person described
          in clause (i), (ii), or (iii) of paragraph (11)(A) of this
          section; (bb) the entity, instrumentality, agency, or
          department owns and invests on a discretionary basis
          $25,000,000 or more in investments; or (cc) the agreement,
          contract, or transaction is offered by, and entered into
          with, an entity that is listed in any of subclauses (I)
          through (VI) of section 2(c)(2)(B)(ii) of this title;
            (viii)(I) a broker or dealer subject to regulation under
          the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.)
          or a foreign person performing a similar role or function
          subject as such to foreign regulation, except that, if the
          broker or dealer or foreign person is a natural person or
          proprietorship, the broker or dealer or foreign person shall
          not be considered to be an eligible contract participant
          unless the broker or dealer or foreign person also meets the
          requirements of clause (v) or (xi);
            (II) an associated person of a registered broker or dealer
          concerning the financial or securities activities of which
          the registered person makes and keeps records under section
          15C(b) or 17(h) of the Securities Exchange Act of 1934 (15
          U.S.C. 78o-5(b), 78q(h));
            (III) an investment bank holding company (as defined in
          section 17(i) of the Securities Exchange Act of 1934 (15
          U.S.C. 78q(i)); (!1)

            (ix) a futures commission merchant subject to regulation
          under this chapter or a foreign person performing a similar
          role or function subject as such to foreign regulation,
          except that, if the futures commission merchant or foreign
          person is a natural person or proprietorship, the futures
          commission merchant or foreign person shall not be considered
          to be an eligible contract participant unless the futures
          commission merchant or foreign person also meets the
          requirements of clause (v) or (xi);
            (x) a floor broker or floor trader subject to regulation
          under this chapter in connection with any transaction that
          takes place on or through the facilities of a registered
          entity or an exempt board of trade, or any affiliate thereof,
          on which such person regularly trades; or
            (xi) an individual who has total assets in an amount in
          excess of - 
              (I) $10,000,000; or
              (II) $5,000,000 and who enters into the agreement,
            contract, or transaction in order to manage the risk
            associated with an asset owned or liability incurred, or
            reasonably likely to be owned or incurred, by the
            individual;

          (B)(i) a person described in clause (i), (ii), (iv), (v),
        (viii), (ix), or (x) of subparagraph (A) or in subparagraph
        (C), acting as broker or performing an equivalent agency
        function on behalf of another person described in subparagraph
        (A) or (C); or
          (ii) an investment adviser subject to regulation under the
        Investment Advisers Act of 1940 [15 U.S.C. 80b-1 et seq.], a
        commodity trading advisor subject to regulation under this
        chapter, a foreign person performing a similar role or function
        subject as such to foreign regulation, or a person described in
        clause (i), (ii), (iv), (v), (viii), (ix), or (x) of
        subparagraph (A) or in subparagraph (C), in any such case
        acting as investment manager or fiduciary (but excluding a
        person acting as broker or performing an equivalent agency
        function) for another person described in subparagraph (A) or
        (C) and who is authorized by such person to commit such person
        to the transaction; or
          (C) any other person that the Commission determines to be
        eligible in light of the financial or other qualifications of
        the person.
      (13) Excluded commodity
        The term "excluded commodity" means - 
          (i) an interest rate, exchange rate, currency, security,
        security index, credit risk or measure, debt or equity
        instrument, index or measure of inflation, or other
        macroeconomic index or measure;
          (ii) any other rate, differential, index, or measure of
        economic or commercial risk, return, or value that is - 
            (I) not based in substantial part on the value of a narrow
          group of commodities not described in clause (i); or
            (II) based solely on one or more commodities that have no
          cash market;

          (iii) any economic or commercial index based on prices,
        rates, values, or levels that are not within the control of any
        party to the relevant contract, agreement, or transaction; or
          (iv) an occurrence, extent of an occurrence, or contingency
        (other than a change in the price, rate, value, or level of a
        commodity not described in clause (i)) that is - 
            (I) beyond the control of the parties to the relevant
          contract, agreement, or transaction; and
            (II) associated with a financial, commercial, or economic
          consequence.
      (14) Exempt commodity
        The term "exempt commodity" means a commodity that is not an
      excluded commodity or an agricultural commodity.
      (15) Financial institution
        The term "financial institution" means - 
          (A) a corporation operating under the fifth undesignated
        paragraph of section 25 of the Federal Reserve Act (12 U.S.C.
        603), commonly known as "an agreement corporation";
          (B) a corporation organized under section 25A of the Federal
        Reserve Act (12 U.S.C. 611 et seq.), commonly known as an "Edge
        Act corporation";
          (C) an institution that is regulated by the Farm Credit
        Administration;
          (D) a Federal credit union or State credit union (as defined
        in section 1752 of title 12);
          (E) a depository institution (as defined in section 1813 of
        title 12);
          (F) a foreign bank or a branch or agency of a foreign bank
        (each as defined in section 3101 of title 12);
          (G) any financial holding company (as defined in section 1841
        of title 12);
          (H) a trust company; or
          (I) a similarly regulated subsidiary or affiliate of an
        entity described in any of subparagraphs (A) through (H).
      (16) Floor broker
        The term "floor broker" means any person who, in or surrounding
      any pit, ring, post, or other place provided by a contract market
      or derivatives transaction execution facility for the meeting of
      persons similarly engaged, shall purchase or sell for any other
      person any commodity for future delivery on or subject to the
      rules of any contract market or derivatives transaction execution
      facility.
      (17) Floor trader
        The term "floor trader" means any person who, in or surrounding
      any pit, ring, post, or other place provided by a contract market
      or derivatives transaction execution facility for the meeting of
      persons similarly engaged, purchases, or sells solely for such
      person's own account, any commodity for future delivery on or
      subject to the rules of any contract market or derivatives
      transaction execution facility.
      (18) Foreign futures authority
        The term "foreign futures authority" means any foreign
      government, or any department, agency, governmental body, or
      regulatory organization empowered by a foreign government to
      administer or enforce a law, rule, or regulation as it relates to
      a futures or options matter, or any department or agency of a
      political subdivision of a foreign government empowered to
      administer or enforce a law, rule, or regulation as it relates to
      a futures or options matter.
      (19) Future delivery
        The term "future delivery" does not include any sale of any
      cash commodity for deferred shipment or delivery.
      (20) Futures commission merchant
        The term "futures commission merchant" means an individual,
      association, partnership, corporation, or trust that - 
          (A) is engaged in soliciting or in accepting orders for the
        purchase or sale of any commodity for future delivery on or
        subject to the rules of any contract market or derivatives
        transaction execution facility; and
          (B) in or in connection with such solicitation or acceptance
        of orders, accepts any money, securities, or property (or
        extends credit in lieu thereof) to margin, guarantee, or secure
        any trades or contracts that result or may result therefrom.
      (21) Hybrid instrument
        The term "hybrid instrument" means a security having one or
      more payments indexed to the value, level, or rate of, or
      providing for the delivery of, one or more commodities.
      (22) Interstate commerce
        The term "interstate commerce" means commerce - 
          (A) between any State, territory, or possession, or the
        District of Columbia, and any place outside thereof; or
          (B) between points within the same state,(!2) territory, or
        possession, or the District of Columbia, but through any place
        outside thereof, or within any territory or possession, or the
        District of Columbia.

      (23) Introducing broker
        The term "introducing broker" means any person (except an
      individual who elects to be and is registered as an associated
      person of a futures commission merchant) engaged in soliciting or
      in accepting orders for the purchase or sale of any commodity for
      future delivery on or subject to the rules of any contract market
      or derivatives transaction execution facility who does not accept
      any money, securities, or property (or extend credit in lieu
      thereof) to margin, guarantee, or secure any trades or contracts
      that result or may result therefrom.
      (24) Member of a registered entity; member of a derivatives
        transaction execution facility
        The term "member" means, with respect to a registered entity or
      derivatives transaction execution facility, an individual,
      association, partnership, corporation, or trust - 
          (A) owning or holding membership in, or admitted to
        membership representation on, the registered entity or
        derivatives transaction execution facility; or
          (B) having trading privileges on the registered entity or
        derivatives transaction execution facility.

      A participant in an alternative trading system that is designated
      as a contract market pursuant to section 7b-1 of this title is
      deemed a member of the contract market for purposes of
      transactions in security futures products through the contract
      market.
      (25) Narrow-based security index
        (A) The term "narrow-based security index" means an index - 
          (i) that has 9 or fewer component securities;
          (ii) in which a component security comprises more than 30
        percent of the index's weighting;
          (iii) in which the five highest weighted component securities
        in the aggregate comprise more than 60 percent of the index's
        weighting; or
          (iv) in which the lowest weighted component securities
        comprising, in the aggregate, 25 percent of the index's
        weighting have an aggregate dollar value of average daily
        trading volume of less than $50,000,000 (or in the case of an
        index with 15 or more component securities, $30,000,000),
        except that if there are two or more securities with equal
        weighting that could be included in the calculation of the
        lowest weighted component securities comprising, in the
        aggregate, 25 percent of the index's weighting, such securities
        shall be ranked from lowest to highest dollar value of average
        daily trading volume and shall be included in the calculation
        based on their ranking starting with the lowest ranked
        security.

        (B) Notwithstanding subparagraph (A), an index is not a narrow-
      based security index if - 
          (i)(I) it has at least 9 component securities;
          (II) no component security comprises more than 30 percent of
        the index's weighting; and
          (III) each component security is - 
            (aa) registered pursuant to section 12 of the Securities
          Exchange Act of 1934 [15 U.S.C. 78l];
            (bb) one of 750 securities with the largest market
          capitalization; and
            (cc) one of 675 securities with the largest dollar value of
          average daily trading volume;

          (ii) a board of trade was designated as a contract market by
        the Commodity Futures Trading Commission with respect to a
        contract of sale for future delivery on the index, before
        December 21, 2000;
          (iii)(I) a contract of sale for future delivery on the index
        traded on a designated contract market or registered
        derivatives transaction execution facility for at least 30 days
        as a contract of sale for future delivery on an index that was
        not a narrow-based security index; and
          (II) it has been a narrow-based security index for no more
        than 45 business days over 3 consecutive calendar months;
          (iv) a contract of sale for future delivery on the index is
        traded on or subject to the rules of a foreign board of trade
        and meets such requirements as are jointly established by rule
        or regulation by the Commission and the Securities and Exchange
        Commission;
          (v) no more than 18 months have passed since December 21,
        2000, and - 
            (I) it is traded on or subject to the rules of a foreign
          board of trade;
            (II) the offer and sale in the United States of a contract
          of sale for future delivery on the index was authorized
          before December 21, 2000; and
            (III) the conditions of such authorization continue to be
          met; or

          (vi) a contract of sale for future delivery on the index is
        traded on or subject to the rules of a board of trade and meets
        such requirements as are jointly established by rule,
        regulation, or order by the Commission and the Securities and
        Exchange Commission.

        (C) Within 1 year after December 21, 2000, the Commission and
      the Securities and Exchange Commission jointly shall adopt rules
      or regulations that set forth the requirements under subparagraph
      (B)(iv).
        (D) An index that is a narrow-based security index solely
      because it was a narrow-based security index for more than 45
      business days over 3 consecutive calendar months pursuant to
      clause (iii) of subparagraph (B) shall not be a narrow-based
      security index for the 3 following calendar months.
        (E) For purposes of subparagraphs (A) and (B) - 
          (i) the dollar value of average daily trading volume and the
        market capitalization shall be calculated as of the preceding 6
        full calendar months; and
          (ii) the Commission and the Securities and Exchange
        Commission shall, by rule or regulation, jointly specify the
        method to be used to determine market capitalization and dollar
        value of average daily trading volume.
      (26) Option
        The term "option" means an agreement, contract, or transaction
      that is of the character of, or is commonly known to the trade
      as, an "option", "privilege", "indemnity", "bid", "offer", "put",
      "call", "advance guaranty", or "decline guaranty".
      (27) Organized exchange
        The term "organized exchange" means a trading facility that - 
          (A) permits trading - 
            (i) by or on behalf of a person that is not an eligible
          contract participant; or
            (ii) by persons other than on a principal-to-principal
          basis; or

          (B) has adopted (directly or through another nongovernmental
        entity) rules that - 
            (i) govern the conduct of participants, other than rules
          that govern the submission of orders or execution of
          transactions on the trading facility; and
            (ii) include disciplinary sanctions other than the
          exclusion of participants from trading.
      (28) Person
        The term "person" imports the plural or singular, and includes
      individuals, associations, partnerships, corporations, and
      trusts.
      (29) Registered entity
        The term "registered entity" means - 
          (A) a board of trade designated as a contract market under
        section 7 of this title;
          (B) a derivatives transaction execution facility registered
        under section 7a of this title;
          (C) a derivatives clearing organization registered under
        section 7a-1 of this title; and
          (D) a board of trade designated as a contract market under
        section 7b-1 of this title.
      (30) Security
        The term "security" means a security as defined in section
      2(a)(1) of the Securities Act of 1933 (15 U.S.C. 77b(a)(1)) or
      section 3(a)(10) of the Securities Exchange Act of 1934 (15
      U.S.C. 78c(a)(10)).
      (31) Security future
        The term "security future" means a contract of sale for future
      delivery of a single security or of a narrow-based security
      index, including any interest therein or based on the value
      thereof, except an exempted security under section 3(a)(12) of
      the Securities Exchange Act of 1934 [15 U.S.C. 78c(a)(12)] as in
      effect on January 11, 1983 (other than any municipal security as
      defined in section 3(a)(29) of the Securities Exchange Act of
      1934 [15 U.S.C. 78c(a)(29)] as in effect on January 11, 1983).
      The term "security future" does not include any agreement,
      contract, or transaction excluded from this chapter under section
      2(c), 2(d), 2(f), or 2(g) of this title (as in effect on December
      21, 2000) or sections 27 to 27f of this title.
      (32) Security futures product
        The term "security futures product" means a security future or
      any put, call, straddle, option, or privilege on any security
      future.
      (33) Trading facility
        (A) In general
          The term "trading facility" means a person or group of
        persons that constitutes, maintains, or provides a physical or
        electronic facility or system in which multiple participants
        have the ability to execute or trade agreements, contracts, or
        transactions by accepting bids and offers made by other
        participants that are open to multiple participants in the
        facility or system.
        (B) Exclusions
          The term "trading facility" does not include - 
            (i) a person or group of persons solely because the person
          or group of persons constitutes, maintains, or provides an
          electronic facility or system that enables participants to
          negotiate the terms of and enter into bilateral transactions
          as a result of communications exchanged by the parties and
          not from interaction of multiple bids and multiple offers
          within a predetermined, nondiscretionary automated trade
          matching and execution algorithm;
            (ii) a government securities dealer or government
          securities broker, to the extent that the dealer or broker
          executes or trades agreements, contracts, or transactions in
          government securities, or assists persons in communicating
          about, negotiating, entering into, executing, or trading an
          agreement, contract, or transaction in government securities
          (as the terms "government securities dealer", "government
          securities broker", and "government securities" are defined
          in section 3(a) of the Securities Exchange Act of 1934 (15
          U.S.C. 78c(a))); or
            (iii) facilities on which bids and offers, and acceptances
          of bids and offers effected on the facility, are not binding.

         Any person, group of persons, dealer, broker, or facility
        described in clause (i) or (ii) is excluded from the meaning of
        the term "trading facility" for the purposes of this chapter
        without any prior specific approval, certification, or other
        action by the Commission.
        (C) Special rule
          A person or group of persons that would not otherwise
        constitute a trading facility shall not be considered to be a
        trading facility solely as a result of the submission to a
        derivatives clearing organization of transactions executed on
        or through the person or group of persons.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 1a, as added Pub. L. 102-546, title
    IV, Sec. 404(a), Oct. 28, 1992, 106 Stat. 3625; amended Pub. L. 106-
    554, Sec. 1(a)(5) [title I, Secs. 101, 123(a)(1)], Dec. 21, 2000,
    114 Stat. 2763, 2763A-366, 2763A-405.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Employee Retirement Income Security Act of 1974, referred to
    in pars. (6)(B)(v) and (12)(A)(vi), is Pub. L. 93-406, Sept. 2,
    1974, 88 Stat. 829, as amended, which is classified principally to
    chapter 18 (Sec. 1001 et seq.) of Title 29, Labor. For complete
    classification of this Act to the Code, see Short Title note set
    out under section 1001 of Title 29 and Tables.
      The Securities Act of 1933, referred to in par.
    (11)(B)(ii)(I)(bb), is title I of act May 27, 1933, ch. 38, 48
    Stat. 74, as amended, which is classified generally to subchapter I
    (Sec. 77a et seq.) of chapter 2A of Title 15, Commerce and Trade.
    For complete classification of this Act to the Code, see section
    77a of Title 15 and Tables.
      The Investment Company Act of 1940, referred to in par.
    (12)(A)(iii), is title I of act Aug. 22, 1940, ch. 686, 54 Stat.
    789, as amended, which is classified generally to subchapter I
    (Sec. 80a-1 et seq.) of chapter 2D of Title 15, Commerce and Trade.
    For complete classification of this Act to the Code, see section
    80a-51 of Title 15 and Tables.
      The Investment Advisers Act of 1940, referred to in par.
    (12)(A)(vi)(II)(aa), (B)(ii), is title II of act Aug. 22, 1940, ch.
    686, 54 Stat. 847, as amended, which is classified generally to
    subchapter II (Sec. 80b-1 et seq.) of chapter 2D of Title 15,
    Commerce and Trade. For complete classification of this Act to the
    Code, see section 80b-20 of Title 15 and Tables.
      The Securities Exchange Act of 1934, referred to in par.
    (12)(A)(viii)(I), is act June 6, 1934, ch. 404, 48 Stat. 881, as
    amended, which is classified principally to chapter 2B (Sec. 78a et
    seq.) of Title 15, Commerce and Trade. For complete classification
    of this Act to the Code, see section 78a of Title 15 and Tables.
      Section 25A of the Federal Reserve Act, referred to in par.
    (15)(B), popularly known as the Edge Act, is classified to
    subchapter II (Sec. 611 et seq.) of chapter 6 of Title 12, Banks
    and Banking. For complete classification of this Act to the Code,
    see Short Title note set out under section 611 of Title 12 and
    Tables.

-MISC1-
                                AMENDMENTS                            
      2000 - Par. (1). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    101(2)], added par. (1). Former par. (1) redesignated (2).
      Par. (2). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 101(3)],
    added par. (2) and struck out heading and text of former par. (2).
    Text read as follows: "The term 'board of trade' means any exchange
    or association, whether incorporated or unincorporated, of persons
    who are engaged in the business of buying or selling any commodity
    or receiving the same for sale on consignment."
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 101(1)],
    redesignated par. (1) as (2). Former par. (2) redesignated (3).
      Pars. (3), (4). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    101(1)], redesignated pars. (2) and (3) as (3) and (4),
    respectively. Former par. (4) redesignated (5).
      Par. (5). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(1)(A)], inserted "or derivatives transaction execution
    facility" after "contract market".
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 101(1)],
    redesignated par. (4) as (5). Former par. (5) redesignated (6).
      Par. (6). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(1)(A)], inserted "or derivatives transaction execution
    facility" after "contract market" in subpars. (A)(i)(I) and
    (B)(vi).
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 101(1)],
    redesignated par. (5) as (6). Former par. (6) redesignated (7).
      Pars. (7), (8). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    101(1)], redesignated pars. (6) and (7) as (7) and (8),
    respectively. Former par. (8) redesignated (16).
      Pars. (9) to (15). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    101(4)], added pars. (9) to (15). Former pars. (9) to (12) and (13)
    to (15) redesignated (17) to (20) and (22) to (24), respectively.
      Par. (16). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(1)(A)], inserted "or derivatives transaction execution
    facility" after "contract market" in two places.
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 101(1)],
    redesignated par. (8) as (16). Former par. (16) redesignated (28).
      Par. (17). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(1)(A)], inserted "or derivatives transaction execution
    facility" after "contract market" in two places.
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 101(1)],
    redesignated par. (9) as (17).
      Pars. (18), (19). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    101(1)], redesignated pars. (10) and (11) as (18) and (19),
    respectively.
      Par. (20). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 101(1)],
    redesignated par. (12) as (20).
      Par. (20)(A). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(1)(A)], inserted "or derivatives transaction execution
    facility" after "contract market".
      Par. (21). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 101(5)],
    added par. (21).
      Par. (22). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 101(1)],
    redesignated par. (13) as (22).
      Par. (23). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(1)(A)], inserted "or derivatives transaction execution
    facility" after "contract market".
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 101(1)],
    redesignated par. (14) as (23).
      Par. (24). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(1)(B)], substituted "registered entity" for "contract
    market" wherever appearing in heading and text and inserted
    concluding provisions.
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 101(6)], added par.
    (24) and struck out heading and text of former par. (24). Text read
    as follows: "The term 'member of a contract market' means an
    individual, association, partnership, corporation, or trust owning
    or holding membership in, or admitted to membership representation
    on, a contract market or given members' trading privileges
    thereon."
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 101(1)],
    redesignated par. (15) as (24).
      Pars. (25) to (27). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    101(6)], added pars. (25) to (27).
      Par. (28). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 101(1)],
    redesignated par. (16) as (28).
      Pars. (29) to (33). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    101(7)], added pars. (29) to (33).

                              EFFECTIVE DATE                          
      Section 403 of Pub. L. 102-546 provided that: "Except as
    otherwise specifically provided in this Act [enacting this section
    and section 12e of this title, amending sections 2, 2a, 4, 4a, 6 to
    6c, 6e to 6g, 6j, 6p, 7 to 9a, 10a, 12, 12a, 12c, 13 to 13c, 15,
    16, 18, 19, 21, and 25 of this title, repealing section 26 of this
    title, enacting provisions set out as notes under sections 1a, 4a,
    6c, 6e, 6j, 6p, 7a, 13, 16a, 21, and 22 of this title, and
    repealing provisions set out as a note under section 4a of this
    title], this Act and the amendments made by this Act shall become
    effective on the date of enactment of this Act [Oct. 28, 1992]."

-FOOTNOTE-               

    (!1) So in original. The semicolon probably should be preceded
         by an additional closing parenthesis.

    (!2) So in original. Probably should be capitalized.

-End-

-CITE-
    7 USC Sec. 2                                                01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 2. Jurisdiction of Commission; liability of principal for act
      of agent; Commodity Futures Trading Commission; transaction in
      interstate commerce

-STATUTE-
    (a) Jurisdiction of Commission; Commodity Futures Trading
      Commission
      (1) Jurisdiction of Commission
        (A) In general
          The Commission shall have exclusive jurisdiction, except to
        the extent otherwise provided in subparagraphs (C) and (D) of
        this paragraph and subsections (c) through (i) of this section,
        with respect to accounts, agreements (including any transaction
        which is of the character of, or is commonly known to the trade
        as, an "option", "privilege", "indemnity", "bid", "offer",
        "put", "call", "advance guaranty", or "decline guaranty"), and
        transactions involving contracts of sale of a commodity for
        future delivery, traded or executed on a contract market
        designated or derivatives transaction execution facility
        registered pursuant to section 7 or 7a of this title or any
        other board of trade, exchange, or market, and transactions
        subject to regulation by the Commission pursuant to section 23
        of this title. Except as hereinabove provided, nothing
        contained in this section shall (I) supersede or limit the
        jurisdiction at any time conferred on the Securities and
        Exchange Commission or other regulatory authorities under the
        laws of the United States or of any State, or (II) restrict the
        Securities and Exchange Commission and such other authorities
        from carrying out their duties and responsibilities in
        accordance with such laws. Nothing in this section shall
        supersede or limit the jurisdiction conferred on courts of the
        United States or any State.
        (B) Liability of principal for act of agent
          The act, omission, or failure of any official, agent, or
        other person acting for any individual, association,
        partnership, corporation, or trust within the scope of his
        employment or office shall be deemed the act, omission, or
        failure of such individual, association, partnership,
        corporation, or trust, as well as of such official, agent, or
        other person.
        (C) Designation of boards of trade as contract markets;
          contracts for future delivery; security futures products;
          filing with Board of Governors of Federal Reserve System;
          judicial review
          Notwithstanding any other provision of law - 
            (i) This chapter shall not apply to and the Commission
          shall have no jurisdiction to designate a board of trade as a
          contract market for any transaction whereby any party to such
          transaction acquires any put, call, or other option on one or
          more securities (as defined in section 77b(1) (!1) of title
          15 or section 3(a)(10) of the Securities Exchange Act of 1934
          [15 U.S.C. 78c(a)(10)] on January 11, 1983), including any
          group or index of such securities, or any interest therein or
          based on the value thereof.

            (ii) This chapter shall apply to and the Commission shall
          have exclusive jurisdiction with respect to accounts,
          agreements (including any transaction which is of the
          character of, or is commonly known to the trade as, an
          "option", "privilege", "indemnity", "bid", "offer", "put",
          "call", "advance guaranty", or "decline guaranty") and
          transactions involving, and may designate a board of trade as
          a contract market in, or register a derivatives transaction
          execution facility that trades or executes, contracts of sale
          (or options on such contracts) for future delivery of a group
          or index of securities (or any interest therein or based upon
          the value thereof): Provided, however, That no board of trade
          shall be designated as a contract market with respect to any
          such contracts of sale (or options on such contracts) for
          future delivery, and no derivatives transaction execution
          facility shall trade or execute such contracts of sale (or
          options on such contracts) for future delivery, unless the
          board of trade or the derivatives transaction execution
          facility, and the applicable contract, meet the following
          minimum requirements:
              (I) Settlement of or delivery on such contract (or option
            on such contract) shall be effected in cash or by means
            other than the transfer or receipt of any security, except
            an exempted security under section 77c of title 15 or
            section 3(a)(12) of the Securities Exchange Act of 1934 [15
            U.S.C. 78c(a)(12)] as in effect on January 11, 1983, (other
            than any municipal security, as defined in section 3(a)(29)
            of the Securities Exchange Act of 1934 [15 U.S.C.
            78c(a)(29)] on January 11, 1983);
              (II) Trading in such contract (or option on such
            contract) shall not be readily susceptible to manipulation
            of the price of such contract (or option on such contract),
            nor to causing or being used in the manipulation of the
            price of any underlying security, option on such security
            or option on a group or index including such securities;
            and
              (III) Such group or index of securities shall not
            constitute a narrow-based security index.

            (iii) If, in its discretion, the Commission determines that
          a stock index futures contract, notwithstanding its
          conformance with the requirements in clause (ii) of this
          subparagraph, can reasonably be used as a surrogate for
          trading a security (including a security futures product), it
          may, by order, require such contract and any option thereon
          be traded and regulated as security futures products as
          defined in section 3(a)(56) of the Securities Exchange Act of
          1934 [15 U.S.C. 78c(a)(56)] and section 1a of this title
          subject to all rules and regulations applicable to security
          futures products under this chapter and the securities laws
          as defined in section 3(a)(47) of the Securities Exchange Act
          of 1934 [15 U.S.C. 78c(a)(47)].
            (iv) No person shall offer to enter into, enter into, or
          confirm the execution of any contract of sale (or option on
          such contract) for future delivery of any security, or
          interest therein or based on the value thereof, except an
          exempted security under or (!2) section 3(a)(12) of the
          Securities Exchange Act of 1934 [15 U.S.C. 78c(a)(12)] as in
          effect on January 11, 1983 (other than any municipal security
          as defined in section 3(a)(29) of the Securities Exchange Act
          of 1934 [15 U.S.C. 78c(a)(29)] on January 11, 1983), or
          except as provided in clause (ii) of this subparagraph or
          subparagraph (D), any group or index of such securities or
          any interest therein or based on the value thereof.

            (v)(I) Notwithstanding any other provision of this chapter,
          any contract market in a stock index futures contract (or
          option thereon) other than a security futures product, or any
          derivatives transaction execution facility on which such
          contract or option is traded, shall file with the Board of
          Governors of the Federal Reserve System any rule establishing
          or changing the levels of margin (initial and maintenance)
          for such stock index futures contract (or option thereon)
          other than security futures products.
            (II) The Board may at any time request any contract market
          or derivatives transaction execution facility to set the
          margin for any stock index futures contract (or option
          thereon), other than for any security futures product, at
          such levels as the Board in its judgment determines are
          appropriate to preserve the financial integrity of the
          contract market or derivatives transaction execution
          facility, or its clearing system, or to prevent systemic
          risk. If the contract market or derivatives transaction
          execution facility fails to do so within the time specified
          by the Board in its request, the Board may direct the
          contract market or derivatives transaction execution facility
          to alter or supplement the rules of the contract market or
          derivatives transaction execution facility as specified in
          the request.
            (III) Subject to such conditions as the Board may
          determine, the Board may delegate any or all of its
          authority, relating to margin for any stock index futures
          contract (or option thereon), other than security futures
          products, under this clause to the Commission.
            (IV) It shall be unlawful for any futures commission
          merchant to, directly or indirectly, extend or maintain
          credit to or for, or collect margin from any customer on any
          security futures product unless such activities comply with
          the regulations prescribed pursuant to section 7(c)(2)(B) of
          the Securities Exchange Act of 1934 [15 U.S.C. 78g(c)(2)(B)].
            (V) Nothing in this clause shall supersede or limit the
          authority granted to the Commission in section 12a(9) of this
          title to direct a contract market or registered derivatives
          transaction execution facility, on finding an emergency to
          exist, to raise temporary margin levels on any futures
          contract, or option on the contract covered by this clause,
          or on any security futures product.
            (VI) Any action taken by the Board, or by the Commission
          acting under the delegation of authority under subclause
          III,(!3) under this clause directing a contract market to
          alter or supplement a contract market rule shall be subject
          to review only in the Court of Appeals where the party
          seeking review resides or has its principal place of
          business, or in the United States Court of Appeals for the
          District of Columbia Circuit. The review shall be based on
          the examination of all information before the Board or the
          Commission, as the case may be, at the time the determination
          was made. The court reviewing the action of the Board or the
          Commission shall not enter a stay or order of mandamus unless
          the court has determined, after notice and a hearing before a
          panel of the court, that the agency action complained of was
          arbitrary, capricious, an abuse of discretion, or otherwise
          not in accordance with law.

        (D) Jurisdiction and authority of Securities and Exchange
          Commission over security futures; requirements for security
          futures trading; periodic or special examinations by
          Commission representatives
          (i) Notwithstanding any other provision of this chapter, the
        Securities and Exchange Commission shall have jurisdiction and
        authority over security futures as defined in section 3(a)(55)
        of the Securities Exchange Act of 1934 [15 U.S.C. 78c(a)(55)],
        section 77b(a)(16) of title 15, section 80a-2(a)(52) of title
        15, and section 80b-2(a)(27) of title 15, options on security
        futures, and persons effecting transactions in security futures
        and options thereon, and this chapter shall apply to and the
        Commission shall have jurisdiction with respect to accounts,
        agreements (including any transaction which is of the character
        of, or is commonly known to the trade as, an "option",
        "privilege", "indemnity", "bid", "offer", "put", "call",
        "advance guaranty", or "decline guaranty"), contracts, and
        transactions involving, and may designate a board of trade as a
        contract market in, or register a derivatives transaction
        execution facility that trades or executes, a security futures
        product as defined in section 1a of this title: Provided,
        however, That, except as provided in clause (vi) of this
        subparagraph, no board of trade shall be designated as a
        contract market with respect to, or registered as a derivatives
        transaction execution facility for, any such contracts of sale
        for future delivery unless the board of trade and the
        applicable contract meet the following criteria:
            (I) Except as otherwise provided in a rule, regulation, or
          order issued pursuant to clause (v) of this subparagraph, any
          security underlying the security future, including each
          component security of a narrow-based security index, is
          registered pursuant to section 12 of the Securities Exchange
          Act of 1934 [15 U.S.C. 78l].
            (II) If the security futures product is not cash settled,
          the board of trade on which the security futures product is
          traded has arrangements in place with a clearing agency
          registered pursuant to section 17A of the Securities Exchange
          Act of 1934 [15 U.S.C. 78q-1] for the payment and delivery of
          the securities underlying the security futures product.
            (III) Except as otherwise provided in a rule, regulation,
          or order issued pursuant to clause (v) of this subparagraph,
          the security future is based upon common stock and such other
          equity securities as the Commission and the Securities and
          Exchange Commission jointly determine appropriate.
            (IV) The security futures product is cleared by a clearing
          agency that has in place provisions for linked and
          coordinated clearing with other clearing agencies that clear
          security futures products, which permits the security futures
          product to be purchased on a designated contract market,
          registered derivatives transaction execution facility,
          national securities exchange registered under section 6(a) of
          the Securities Exchange Act of 1934 [15 U.S.C. 78f(a)], or
          national securities association registered pursuant to
          section 15A(a) of the Securities Exchange Act of 1934 [15
          U.S.C. 78o-3(a)] and offset on another designated contract
          market, registered derivatives transaction execution
          facility, national securities exchange registered under
          section 6(a) of the Securities Exchange Act of 1934, or
          national securities association registered pursuant to
          section 15A(a) of the Securities Exchange Act of 1934.
            (V) Only futures commission merchants, introducing brokers,
          commodity trading advisors, commodity pool operators or
          associated persons subject to suitability rules comparable to
          those of a national securities association registered
          pursuant to section 15A(a) of the Securities Exchange Act of
          1934 [15 U.S.C. 78o-3(a)] solicit, accept any order for, or
          otherwise deal in any transaction in or in connection with
          the security futures product.
            (VI) The security futures product is subject to a
          prohibition against dual trading in section 6j of this title
          and the rules and regulations thereunder or the provisions of
          section 11(a) of the Securities Exchange Act of 1934 [15
          U.S.C. 78k(a)] and the rules and regulations thereunder,
          except to the extent otherwise permitted under the Securities
          Exchange Act of 1934 [15 U.S.C. 78a et seq.] and the rules
          and regulations thereunder.
            (VII) Trading in the security futures product is not
          readily susceptible to manipulation of the price of such
          security futures product, nor to causing or being used in the
          manipulation of the price of any underlying security, option
          on such security, or option on a group or index including
          such securities;
            (VIII) The board of trade on which the security futures
          product is traded has procedures in place for coordinated
          surveillance among such board of trade, any market on which
          any security underlying the security futures product is
          traded, and other markets on which any related security is
          traded to detect manipulation and insider trading, except
          that, if the board of trade is an alternative trading system,
          a national securities association registered pursuant to
          section 15A(a) of the Securities Exchange Act of 1934 [15
          U.S.C. 78o-3(a)] or national securities exchange registered
          pursuant to section 6(a) of the Securities Exchange Act of
          1934 [15 U.S.C. 78f(a)] of which such alternative trading
          system is a member has in place such procedures.
            (IX) The board of trade on which the security futures
          product is traded has in place audit trails necessary or
          appropriate to facilitate the coordinated surveillance
          required in subclause (VIII), except that, if the board of
          trade is an alternative trading system, a national securities
          association registered pursuant to section 15A(a) of the
          Securities Exchange Act of 1934 [15 U.S.C. 78o-3(a)] or
          national securities exchange registered pursuant to section
          6(a) of the Securities Exchange Act of 1934 [15 U.S.C.
          78f(a)] of which such alternative trading system is a member
          has rules to require such audit trails.
            (X) The board of trade on which the security futures
          product is traded has in place procedures to coordinate
          trading halts between such board of trade and markets on
          which any security underlying the security futures product is
          traded and other markets on which any related security is
          traded, except that, if the board of trade is an alternative
          trading system, a national securities association registered
          pursuant to section 15A(a) of the Securities Exchange Act of
          1934 [15 U.S.C. 78o-3(a)] or national securities exchange
          registered pursuant to section 6(a) of the Securities
          Exchange Act of 1934 [15 U.S.C. 78f(a)] of which such
          alternative trading system is a member has rules to require
          such coordinated trading halts.
            (XI) The margin requirements for a security futures product
          comply with the regulations prescribed pursuant to section
          7(c)(2)(B) of the Securities Exchange Act of 1934 [15 U.S.C.
          78g(c)(2)(B)], except that nothing in this subclause shall be
          construed to prevent a board of trade from requiring higher
          margin levels for a security futures product when it deems
          such action to be necessary or appropriate.

          (ii) It shall be unlawful for any person to offer, to enter
        into, to execute, to confirm the execution of, or to conduct
        any office or business anywhere in the United States, its
        territories or possessions, for the purpose of soliciting, or
        accepting any order for, or otherwise dealing in, any
        transaction in, or in connection with, a security futures
        product unless - 
            (I) the transaction is conducted on or subject to the rules
          of a board of trade that - 
              (aa) has been designated by the Commission as a contract
            market in such security futures product; or
              (bb) is a registered derivatives transaction execution
            facility for the security futures product that has provided
            a certification with respect to the security futures
            product pursuant to clause (vii);

            (II) the contract is executed or consummated by, through,
          or with a member of the contract market or registered
          derivatives transaction execution facility; and
            (III) the security futures product is evidenced by a record
          in writing which shows the date, the parties to such security
          futures product and their addresses, the property covered,
          and its price, and each contract market member or registered
          derivatives transaction execution facility member shall keep
          the record for a period of 3 years from the date of the
          transaction, or for a longer period if the Commission so
          directs, which record shall at all times be open to the
          inspection of any duly authorized representative of the
          Commission.

          (iii)(I) Except as provided in subclause (II) but
        notwithstanding any other provision of this chapter, no person
        shall offer to enter into, enter into, or confirm the execution
        of any option on a security future.
          (II) After 3 years after December 21, 2000, the Commission
        and the Securities and Exchange Commission may by order jointly
        determine to permit trading of options on any security future
        authorized to be traded under the provisions of this chapter
        and the Securities Exchange Act of 1934 [15 U.S.C. 78a et
        seq.].
          (iv)(I) All relevant records of a futures commission merchant
        or introducing broker registered pursuant to section 6f(a)(2)
        of this title, floor broker or floor trader exempt from
        registration pursuant to section 6f(a)(3) of this title,
        associated person exempt from registration pursuant to section
        6k(6) (!4) of this title, or board of trade designated as a
        contract market in a security futures product pursuant to
        section 7b-1 of this title shall be subject to such reasonable
        periodic or special examinations by representatives of the
        Commission as the Commission deems necessary or appropriate in
        the public interest, for the protection of investors, or
        otherwise in furtherance of the purposes of this chapter, and
        the Commission, before conducting any such examination, shall
        give notice to the Securities and Exchange Commission of the
        proposed examination and consult with the Securities and
        Exchange Commission concerning the feasibility and desirability
        of coordinating the examination with examinations conducted by
        the Securities and Exchange Commission in order to avoid
        unnecessary regulatory duplication or undue regulatory burdens
        for the registrant or board of trade.

          (II) The Commission shall notify the Securities and Exchange
        Commission of any examination conducted of any futures
        commission merchant or introducing broker registered pursuant
        to section 6f(a)(2) of this title, floor broker or floor trader
        exempt from registration pursuant to section 6f(a)(3) of this
        title, associated person exempt from registration pursuant to
        section 6k(6) (!4) of this title, or board of trade designated
        as a contract market in a security futures product pursuant to
        section 7b-1 of this title, and, upon request, furnish to the
        Securities and Exchange Commission any examination report and
        data supplied to or prepared by the Commission in connection
        with the examination.
          (III) Before conducting an examination under subclause (I),
        the Commission shall use the reports of examinations, unless
        the information sought is unavailable in the reports, of any
        futures commission merchant or introducing broker registered
        pursuant to section 6f(a)(2) of this title, floor broker or
        floor trader exempt from registration pursuant to section
        6f(a)(3) of this title, associated person exempt from
        registration pursuant to section 6k(6) (!4) of this title, or
        board of trade designated as a contract market in a security
        futures product pursuant to section 7b-1 of this title that is
        made by the Securities and Exchange Commission, a national
        securities association registered pursuant to section 15A(a) of
        the Securities Exchange Act of 1934 (15 U.S.C. 78o-3(a)), or a
        national securities exchange registered pursuant to section
        6(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78f(a)).
          (IV) Any records required under this subsection for a futures
        commission merchant or introducing broker registered pursuant
        to section 6f(a)(2) of this title, floor broker or floor trader
        exempt from registration pursuant to section 6f(a)(3) of this
        title, associated person exempt from registration pursuant to
        section 6k(6) (!4) of this title, or board of trade designated
        as a contract market in a security futures product pursuant to
        section 7b-1 of this title, shall be limited to records with
        respect to accounts, agreements, contracts, and transactions
        involving security futures products.
          (v)(I) The Commission and the Securities and Exchange
        Commission, by rule, regulation, or order, may jointly modify
        the criteria specified in subclause (I) or (III) of clause (i),
        including the trading of security futures based on securities
        other than equity securities, to the extent such modification
        fosters the development of fair and orderly markets in security
        futures products, is necessary or appropriate in the public
        interest, and is consistent with the protection of investors.
          (II) The Commission and the Securities and Exchange
        Commission, by order, may jointly exempt any person from
        compliance with the criterion specified in clause (i)(IV) to
        the extent such exemption fosters the development of fair and
        orderly markets in security futures products, is necessary or
        appropriate in the public interest, and is consistent with the
        protection of investors.
          (vi)(I) Notwithstanding clauses (i) and (vii), until the
        compliance date, a board of trade shall not be required to meet
        the criterion specified in clause (i)(IV).
          (II) The Commission and the Securities and Exchange
        Commission shall jointly publish in the Federal Register a
        notice of the compliance date no later than 165 days before the
        compliance date.
          (III) For purposes of this clause, the term "compliance date"
        means the later of - 
            (aa) 180 days after the end of the first full calendar
          month period in which the average aggregate comparable share
          volume for all security futures products based on single
          equity securities traded on all designated contract markets
          and registered derivatives transaction execution facilities
          equals or exceeds 10 percent of the average aggregate
          comparable share volume of options on single equity
          securities traded on all national securities exchanges
          registered pursuant to section 6(a) of the Securities
          Exchange Act of 1934 [15 U.S.C. 78f(a)] and any national
          securities associations registered pursuant to section 15A(a)
          of such Act [15 U.S.C. 78o-3(a)]; or
            (bb) 2 years after the date on which trading in any
          security futures product commences under this chapter.

          (vii) It shall be unlawful for a board of trade to trade or
        execute a security futures product unless the board of trade
        has provided the Commission with a certification that the
        specific security futures product and the board of trade, as
        applicable, meet the criteria specified in subclauses (I)
        through (XI) of clause (i), except as otherwise provided in
        clause (vi).
        (E) Obligation to address security futures products traded on
          foreign exchanges
          (i) To the extent necessary or appropriate in the public
        interest, to promote fair competition, and consistent with
        promotion of market efficiency, innovation, and expansion of
        investment opportunities, the protection of investors, and the
        maintenance of fair and orderly markets, the Commission and the
        Securities and Exchange Commission shall jointly issue such
        rules, regulations, or orders as are necessary and appropriate
        to permit the offer and sale of a security futures product
        traded on or subject to the rules of a foreign board of trade
        to United States persons.
          (ii) The rules, regulations, or orders adopted under clause
        (i) shall take into account, as appropriate, the nature and
        size of the markets that the securities underlying the security
        futures product reflects.
        (F) Security futures products traded on foreign boards of trade
          (i) Nothing in this chapter is intended to prohibit a futures
        commission merchant from carrying security futures products
        traded on or subject to the rules of a foreign board of trade
        in the accounts of persons located outside of the United
        States.
          (ii) Nothing in this chapter is intended to prohibit any
        eligible contract participant located in the United States from
        purchasing or carrying securities futures products traded on or
        subject to the rules of a foreign board of trade, exchange, or
        market to the same extent such person may be authorized to
        purchase or carry other securities traded on a foreign board of
        trade, exchange, or market so long as any underlying security
        for such security futures products is traded principally on,
        by, or through any exchange or market located outside the
        United States.
      (2) Establishment of Commodity Futures Trading Commission;
        composition; terms of Commissioners
        (A) There is hereby established, as an independent agency of
      the United States Government, a Commodity Futures Trading
      Commission. The Commission shall be composed of five
      Commissioners who shall be appointed by the President, by and
      with the advice and consent of the Senate. In nominating persons
      for appointment, the President shall - 
          (i) select persons who shall each have demonstrated knowledge
        in futures trading or its regulation, or the production,
        merchandising, processing or distribution of one or more of the
        commodities or other goods and articles, services, rights, and
        interests covered by this chapter; and
          (ii) seek to ensure that the demonstrated knowledge of the
        Commissioners is balanced with respect to such areas.

      Not more than three of the members of the Commission shall be
      members of the same political party. Each Commissioner shall hold
      office for a term of five years and until his successor is
      appointed and has qualified, except that he shall not so continue
      to serve beyond the expiration of the next session of Congress
      subsequent to the expiration of said fixed term of office, and
      except (i) any Commissioner appointed to fill a vacancy occurring
      prior to the expiration of the term for which his predecessor was
      appointed shall be appointed for the remainder of such term, and
      (ii) the terms of office of the Commissioners first taking office
      after the enactment of this paragraph shall expire as designated
      by the President at the time of nomination, one at the end of one
      year, one at the end of two years, one at the end of three years,
      one at the end of four years, and one at the end of five years.
        (B) The President shall appoint, by and with the advice and
      consent of the Senate, a member of the Commission as Chairman,
      who shall serve as Chairman at the pleasure of the President. An
      individual may be appointed as Chairman at the same time that
      person is appointed as a Commissioner. The Chairman shall be the
      chief administrative officer of the Commission and shall preside
      at hearings before the Commission. At any time, the President may
      appoint, by and with the advice and consent of the Senate, a
      different Chairman, and the Commissioner previously appointed as
      Chairman may complete that Commissioner's term as a Commissioner.
      (3) Vacancies
        A vacancy in the Commission shall not impair the right of the
      remaining Commissioners to exercise all the powers of the
      Commission.
      (4) General Counsel
        The Commission shall have a General Counsel, who shall be
      appointed by the Commission and serve at the pleasure of the
      Commission. The General Counsel shall report directly to the
      Commission and serve as its legal advisor. The Commission shall
      appoint such other attorneys as may be necessary, in the opinion
      of the Commission, to assist the General Counsel, represent the
      Commission in all disciplinary proceedings pending before it,
      represent the Commission in courts of law whenever appropriate,
      assist the Department of Justice in handling litigation
      concerning the Commission in courts of law, and perform such
      other legal duties and functions as the Commission may direct.
      (5) Executive Director
        The Commission shall have an Executive Director, who shall be
      appointed by the Commission and serve at the pleasure of the
      Commission. The Executive Director shall report directly to the
      Commission and perform such functions and duties as the
      Commission may prescribe.
      (6) Powers and Functions of Chairman
        (A) Except as otherwise provided in this paragraph and in
      paragraphs (4) and (5) of this subsection, the executive and
      administrative functions of the Commission, including functions
      of the Commission with respect to the appointment and supervision
      of personnel employed under the Commission, the distribution of
      business among such personnel and among administrative units of
      the Commission, and the use and expenditure of funds, according
      to budget categories, plans, programs, and priorities established
      and approved by the Commission, shall be exercised solely by the
      Chairman.
        (B) In carrying out any of his functions under the provisions
      of this paragraph, the Chairman shall be governed by general
      policies, plans, priorities, and budgets approved by the
      Commission and by such regulatory decisions, findings, and
      determination as the Commission may by law be authorized to make.
        (C) The appointment by the Chairman of the heads of major
      administrative units under the Commission shall be subject to the
      approval of the Commission.
        (D) Personnel employed regularly and full time in the immediate
      offices of Commissioners other than the Chairman shall not be
      affected by the provisions of this paragraph.
        (E) There are hereby reserved to the Commission its functions
      with respect to revising budget estimates and with respect to
      determining the distribution of appropriated funds according to
      major programs and purposes.
        (F) The Chairman may from time to time make such provisions as
      he shall deem appropriate authorizing the performance by any
      officer, employee, or administrative unit under his jurisdiction
      of any functions of the Chairman under this paragraph.
      (7) Appointment and compensation
        (A) In general
          The Commission may appoint and fix the compensation of such
        officers, attorneys, economists, examiners, and other employees
        as may be necessary for carrying out the functions of the
        Commission under this chapter.
        (B) Rates of pay
          Rates of basic pay for all employees of the Commission may be
        set and adjusted by the Commission without regard to chapter 51
        or subchapter III of chapter 53 of title 5.
        (C) Comparability
          (i) In general
            The Commission may provide additional compensation and
          benefits to employees of the Commission if the same type of
          compensation or benefits are provided by any agency referred
          to in section 1833b(a) of title 12 or could be provided by
          such an agency under applicable provisions of law (including
          rules and regulations).
          (ii) Consultation
            In setting and adjusting the total amount of compensation
          and benefits for employees, the Commission shall consult
          with, and seek to maintain comparability with, the agencies
          referred to in section 1833b(a) of title 12.
      (8) Conflict of interest
        No Commissioner or employee of the Commission shall accept
      employment or compensation from any person, exchange, or
      clearinghouse subject to regulation by the Commission under this
      chapter during his term of office, nor shall he participate,
      directly or indirectly, in any registered entity operations or
      transactions of a character subject to regulation by the
      Commission.
      (9) Liaison with Department of Agriculture; communications with
        Department of the Treasury, Federal Reserve Board, and
        Securities and Exchange Commission; application by a board of
        trade for designation as a contract market for future delivery
        of securities
        (A) The Commission shall, in cooperation with the Secretary of
      Agriculture, maintain a liaison between the Commission and the
      Department of Agriculture. The Secretary shall take such steps as
      may be necessary to enable the Commission to obtain information
      and utilize such services and facilities of the Department of
      Agriculture as may be necessary in order to maintain effectively
      such liaison. In addition, the Secretary shall appoint a liaison
      officer, who shall be an employee of the Office of the Secretary,
      for the purpose of maintaining a liaison between the Department
      of Agriculture and the Commission. The Commission shall furnish
      such liaison officer appropriate office space within the offices
      of the Commission and shall allow such liaison officer to attend
      and observe all deliberations and proceedings of the Commission.
        (B)(i) The Commission shall maintain communications with the
      Department of the Treasury, the Board of Governors of the Federal
      Reserve System, and the Securities and Exchange Commission for
      the purpose of keeping such agencies fully informed of Commission
      activities that relate to the responsibilities of those agencies,
      for the purpose of seeking the views of those agencies on such
      activities, and for considering the relationships between the
      volume and nature of investment and trading in contracts of sale
      of a commodity for future delivery and in securities and
      financial instruments under the jurisdiction of such agencies.
        (ii) When a board of trade applies for designation or
      registration as a contract market or derivatives transaction
      execution facility involving transactions for future delivery of
      any security issued or guaranteed by the United States or any
      agency thereof, the Commission shall promptly deliver a copy of
      such application to the Department of the Treasury and the Board
      of Governors of the Federal Reserve System. The Commission may
      not designate or register a board of trade as a contract market
      or derivatives transaction execution facility based on such
      application until forty-five days after the date the Commission
      delivers the application to such agencies or until the Commission
      receives comments from each of such agencies on the application,
      whichever period is shorter. Any comments received by the
      Commission from such agencies shall be included as part of the
      public record of the Commission's designation proceeding. In
      designating, registering, or refusing, suspending, or revoking
      the designation or registration of, a board of trade as a
      contract market or derivatives transaction execution facility
      involving transactions for future delivery referred to in this
      clause or in considering any possible action under this chapter
      (including without limitation emergency action under section
      12a(9) of this title) with respect to such transactions, the
      Commission shall take into consideration all comments it receives
      from the Department of the Treasury and the Board of Governors of
      the Federal Reserve System and shall consider the effect that any
      such designation, registration, suspension, revocation, or action
      may have on the debt financing requirements of the United States
      Government and the continued efficiency and integrity of the
      underlying market for government securities.
        (iii) The provisions of this subparagraph shall not create any
      rights, liabilities, or obligations upon which actions may be
      brought against the Commission.
      (10) Transmittal of budget requests and legislative
        recommendations to congressional committees
        (A) Whenever the Commission submits any budget estimate or
      request to the President or the Office of Management and Budget,
      it shall concurrently transmit copies of that estimate or request
      to the House and Senate Appropriations Committees and the House
      Committee on Agriculture and the Senate Committee on Agriculture,
      Nutrition, and Forestry.
        (B) Whenever the Commission transmits any legislative
      recommendations, or testimony, or comments on legislation to the
      President or the Office of Management and Budget, it shall
      concurrently transmit copies thereof to the House Committee on
      Agriculture and the Senate Committee on Agriculture, Nutrition,
      and Forestry. No officer or agency of the United States shall
      have any authority to require the Commission to submit its
      legislative recommendations, or testimony, or comments on
      legislation to any officer or agency of the United States for
      approval, comments, or review, prior to the submission of such
      recommendations, testimony, or comments to the Congress. In
      instances in which the Commission voluntarily seeks to obtain the
      comments or review of any officer or agency of the United States,
      the Commission shall include a description of such actions in its
      legislative recommendations, testimony, or comments on
      legislation which it transmits to the Congress.
        (C) Whenever the Commission issues for official publication any
      opinion, release, rule, order, interpretation, or other
      determination on a matter, the Commission shall provide that any
      dissenting, concurring, or separate opinion by any Commissioner
      on the matter be published in full along with the Commission
      opinion, release, rule, order, interpretation, or determination.
      (11) Seal
        The Commission shall have an official seal, which shall be
      judicially noticed.
      (12) Rules and regulations
        The Commission is authorized to promulgate such rules and
      regulations as it deems necessary to govern the operating
      procedures and conduct of the business of the Commission.
    (b) Transaction in interstate commerce
      For the purposes of this chapter (but not in any wise limiting
    the foregoing definition of interstate commerce) a transaction in
    respect to any article shall be considered to be in interstate
    commerce if such article is part of that current of commerce usual
    in the commodity trade whereby commodities and commodity products
    and by-products thereof are sent from one State, with the
    expectation that they will end their transit, after purchase, in
    another, including in addition to cases within the above general
    description, all cases where purchase or sale is either for
    shipment to another State, or for manufacture within the State and
    the shipment outside the State of the products resulting from such
    manufacture. Articles normally in such current of commerce shall
    not be considered out of such commerce through resort being had to
    any means or device intended to remove transactions in respect
    thereto from the provisions of this chapter. For the purpose of
    this paragraph the word "State" includes Territory, the District of
    Columbia, possession of the United States, and foreign nation.
    (c) Agreements, contracts, and transactions in foreign currency,
      government securities, and certain other commodities
      (1) In general
        Except as provided in paragraph (2), nothing in this chapter
      (other than section 7a (to the extent provided in section 7a(g)
      of this title), 7a-1, 7a-3, or 16(e)(2)(B) of this title) governs
      or applies to an agreement, contract, or transaction in - 
          (A) foreign currency;
          (B) government securities;
          (C) security warrants;
          (D) security rights;
          (E) resales of installment loan contracts;
          (F) repurchase transactions in an excluded commodity; or
          (G) mortgages or mortgage purchase commitments.
      (2) Commission jurisdiction
        (A) Agreements, contracts, and transactions traded on an
          organized exchange
          This chapter applies to, and the Commission shall have
        jurisdiction over, an agreement, contract, or transaction
        described in paragraph (1) that is - 
            (i) a contract of sale of a commodity for future delivery
          (or an option on such a contract), or an option on a
          commodity (other than foreign currency or a security or a
          group or index of securities), that is executed or traded on
          an organized exchange; or
            (ii) an option on foreign currency executed or traded on an
          organized exchange that is not a national securities exchange
          registered pursuant to section 6(a) of the Securities
          Exchange Act of 1934 [15 U.S.C. 78f(a)].
        (B) Agreements, contracts, and transactions in retail foreign
          currency
          This chapter applies to, and the Commission shall have
        jurisdiction over, an agreement, contract, or transaction in
        foreign currency that - 
            (i) is a contract of sale of a commodity for future
          delivery (or an option on such a contract) or an option
          (other than an option executed or traded on a national
          securities exchange registered pursuant to section 6(a) of
          the Securities Exchange Act of 1934 [15 U.S.C. 78f(a)]); and
            (ii) is offered to, or entered into with, a person that is
          not an eligible contract participant, unless the
          counterparty, or the person offering to be the counterparty,
          of the person is - 
              (I) a financial institution;
              (II) a broker or dealer registered under section 15(b) or
            15C of the Securities Exchange Act of 1934 (15 U.S.C.
            78o(b), 78o-5) or a futures commission merchant registered
            under this chapter;
              (III) an associated person of a broker or dealer
            registered under section 15(b) or 15C of the Securities
            Exchange Act of 1934 (15 U.S.C. 78o(b), 78o-5), or an
            affiliated person of a futures commission merchant
            registered under this chapter, concerning the financial or
            securities activities of which the registered person makes
            and keeps records under section 15C(b) or 17(h) of the
            Securities Exchange Act of 1934 (15 U.S.C. 78o-5(b),
            78q(h)) or section 6f(c)(2)(B) of this title;
              (IV) an insurance company described in section
            1a(12)(A)(ii) of this title, or a regulated subsidiary or
            affiliate of such an insurance company;
              (V) a financial holding company (as defined in section
            1841 of title 12); or
              (VI) an investment bank holding company (as defined in
            section 17(i) of the Securities Exchange Act of 1934 [15
            U.S.C. 78q(i)]).

          (C) Notwithstanding subclauses (II) and (III) of subparagraph
        (B)(ii), agreements, contracts, or transactions described in
        subparagraph (B) shall be subject to sections 6b, 6c(b), 9, 15,
        and 13b (to the extent that sections 9, 15, and 13b of this
        title prohibit manipulation of the market price of any
        commodity, in interstate commerce, or for future delivery on or
        subject to the rules of any market), 13a-1, 13a-2, and 12(a) of
        this title if they are entered into by a futures commission
        merchant or an affiliate of a futures commission merchant that
        is not also an entity described in subparagraph (B)(ii) of this
        paragraph.
    (d) Excluded derivative transactions
      (1) In general
        Nothing in this chapter (other than section 7a-1 or 16(e)(2)(B)
      of this title (!5) governs or applies to an agreement, contract,
      or transaction in an excluded commodity if - 

          (A) the agreement, contract, or transaction is entered into
        only between persons that are eligible contract participants at
        the time at which the persons enter into the agreement,
        contract, or transaction; and
          (B) the agreement, contract, or transaction is not executed
        or traded on a trading facility.
      (2) Electronic trading facility exclusion
        Nothing in this chapter (other than section 7a (to the extent
      provided in section 7a(g) of this title), 7a-1, 7a-3, or
      16(e)(2)(B) of this title) governs or applies to an agreement,
      contract, or transaction in an excluded commodity if - 
          (A) the agreement, contract, or transaction is entered into
        on a principal-to-principal basis between parties trading for
        their own accounts or as described in section 1a(12)(B)(ii) of
        this title;
          (B) the agreement, contract, or transaction is entered into
        only between persons that are eligible contract participants
        described in subparagraph (A), (B)(ii), or (C) of section
        1a(12) of this title) (!6) at the time at which the persons
        enter into the agreement, contract, or transaction; and

          (C) the agreement, contract, or transaction is executed or
        traded on an electronic trading facility.
    (e) Excluded electronic trading facilities
      (1) In general
        Nothing in this chapter (other than section 16(e)(2)(B) of this
      title) governs or is applicable to an electronic trading facility
      that limits transactions authorized to be conducted on its
      facilities to those satisfying the requirements of subsection
      (d)(2), (g), or (h)(3) of this section.
      (2) Effect on authority to establish and operate
        Nothing in this chapter shall prohibit a board of trade
      designated by the Commission as a contract market or derivatives
      transaction execution facility, or operating as an exempt board
      of trade from establishing and operating an electronic trading
      facility excluded under this chapter pursuant to paragraph (1).
      (3) Effect on transactions
        No failure by an electronic trading facility to limit
      transactions as required by paragraph (1) of this subsection or
      to comply with subsection (h)(5) of this section shall in itself
      affect the legality, validity, or enforceability of an agreement,
      contract, or transaction entered into or traded on the electronic
      trading facility or cause a participant on the system to be in
      violation of this chapter.
      (4) Special rule
        A person or group of persons that would not otherwise
      constitute a trading facility shall not be considered to be a
      trading facility solely as a result of the submission to a
      derivatives clearing organization of transactions executed on or
      through the person or group of persons.
    (f) Exclusion for qualifying hybrid instruments
      (1) In general
        Nothing in this chapter (other than section 16(e)(2)(B) of this
      title) governs or is applicable to a hybrid instrument that is
      predominantly a security.
      (2) Predominance
        A hybrid instrument shall be considered to be predominantly a
      security if - 
          (A) the issuer of the hybrid instrument receives payment in
        full of the purchase price of the hybrid instrument,
        substantially contemporaneously with delivery of the hybrid
        instrument;
          (B) the purchaser or holder of the hybrid instrument is not
        required to make any payment to the issuer in addition to the
        purchase price paid under subparagraph (A), whether as margin,
        settlement payment, or otherwise, during the life of the hybrid
        instrument or at maturity;
          (C) the issuer of the hybrid instrument is not subject by the
        terms of the instrument to mark-to-market margining
        requirements; and
          (D) the hybrid instrument is not marketed as a contract of
        sale of a commodity for future delivery (or option on such a
        contract) subject to this chapter.
      (3) Mark-to-market margining requirements
        For the purposes of paragraph (2)(C), mark-to-market margining
      requirements do not include the obligation of an issuer of a
      secured debt instrument to increase the amount of collateral held
      in pledge for the benefit of the purchaser of the secured debt
      instrument to secure the repayment obligations of the issuer
      under the secured debt instrument.
    (g) Excluded swap transactions
      No provision of this chapter (other than section 7a (to the
    extent provided in section 7a(g) of this title), 7a-1, 7a-3, or
    16(e)(2) of this title) shall apply to or govern any agreement,
    contract, or transaction in a commodity other than an agricultural
    commodity if the agreement, contract, or transaction is - 
        (1) entered into only between persons that are eligible
      contract participants at the time they enter into the agreement,
      contract, or transaction;
        (2) subject to individual negotiation by the parties; and
        (3) not executed or traded on a trading facility.
    (h) Legal certainty for certain transactions in exempt commodities
      (1) Except as provided in paragraph (2), nothing in this chapter
    shall apply to a contract, agreement, or transaction in an exempt
    commodity which - 
        (A) is entered into solely between persons that are eligible
      contract participants at the time the persons enter into the
      agreement, contract, or transaction; and
        (B) is not entered into on a trading facility.

      (2) An agreement, contract, or transaction described in paragraph
    (1) of this subsection shall be subject to - 
        (A) sections 7a-1 and 16(e)(2)(B) of this title;
        (B) sections 6b, 6o, 9, 15, 13b, 13a-1, 13a-2, and 12a of this
      title, and the regulations of the Commission pursuant to section
      6c(b) of this title proscribing fraud in connection with
      commodity option transactions, to the extent the agreement,
      contract, or transaction is not between eligible commercial
      entities (unless one of the entities is an instrumentality,
      department, or agency of a State or local governmental entity)
      and would otherwise be subject to such sections and regulations;
      and
        (C) sections 9, 15, 13b, 13a-1, 13a-2, 12a, and 13(a)(2) of
      this title, to the extent such sections prohibit manipulation of
      the market price of any commodity in interstate commerce and the
      agreement, contract, or transaction would otherwise be subject to
      such sections.

      (3) Except as provided in paragraph (4), nothing in this chapter
    shall apply to an agreement, contract, or transaction in an exempt
    commodity which is - 
        (A) entered into on a principal-to-principal basis solely
      between persons that are eligible commercial entities at the time
      the persons enter into the agreement, contract, or transaction;
      and
        (B) executed or traded on an electronic trading facility.

      (4) An agreement, contract, or transaction described in paragraph
    (3) of this subsection shall be subject to - 
        (A) sections 7a (to the extent provided in section 7a(g) of
      this title), 7a-1, 7a-3, and 16(e)(2)(B) of this title;
        (B) sections 6b and 6o of this title and the regulations of the
      Commission pursuant to section 6c(b) of this title proscribing
      fraud in connection with commodity option transactions to the
      extent the agreement, contract, or transaction would otherwise be
      subject to such sections and regulations;
        (C) sections 9, 15, and 13(a)(2) of this title, to the extent
      such sections prohibit manipulation of the market price of any
      commodity in interstate commerce and to the extent the agreement,
      contract, or transaction would otherwise be subject to such
      sections; and
        (D) such rules and regulations as the Commission may prescribe
      if necessary to ensure timely dissemination by the electronic
      trading facility of price, trading volume, and other trading data
      to the extent appropriate, if the Commission determines that the
      electronic trading facility performs a significant price
      discovery function for transactions in the cash market for the
      commodity underlying any agreement, contract, or transaction
      executed or traded on the electronic trading facility.

      (5) An electronic trading facility relying on the exemption
    provided in paragraph (3) shall - 
        (A) notify the Commission of its intention to operate an
      electronic trading facility in reliance on the exemption set
      forth in paragraph (3), which notice shall include - 
          (i) the name and address of the facility and a person
        designated to receive communications from the Commission;
          (ii) the commodity categories that the facility intends to
        list or otherwise make available for trading on the facility in
        reliance on the exemption set forth in paragraph (3);
          (iii) certifications that - 
            (I) no executive officer or member of the governing board
          of, or any holder of a 10 percent or greater equity interest
          in, the facility is a person described in any of
          subparagraphs (A) through (H) of section 12a(2) of this
          title;
            (II) the facility will comply with the conditions for
          exemption under this paragraph; and
            (III) the facility will notify the Commission of any
          material change in the information previously provided by the
          facility to the Commission pursuant to this paragraph; and

          (iv) the identity of any derivatives clearing organization to
        which the facility transmits or intends to transmit transaction
        data for the purpose of facilitating the clearance and
        settlement of transactions conducted on the facility in
        reliance on the exemption set forth in paragraph (3);

        (B)(i)(I) provide the Commission with access to the facility's
      trading protocols and electronic access to the facility with
      respect to transactions conducted in reliance on the exemption
      set forth in paragraph (3); or
        (II) provide such reports to the Commission regarding
      transactions executed on the facility in reliance on the
      exemption set forth in paragraph (3) as the Commission may from
      time to time request to enable the Commission to satisfy its
      obligations under this chapter;
        (ii) maintain for 5 years, and make available for inspection by
      the Commission upon request, records of activities related to its
      business as an electronic trading facility exempt under paragraph
      (3), including - 
          (I) information relating to data entry and transaction
        details sufficient to enable the Commission to reconstruct
        trading activity on the facility conducted in reliance on the
        exemption set forth in paragraph (3); and
          (II) the name and address of each participant on the facility
        authorized to enter into transactions in reliance on the
        exemption set forth in paragraph (3); and

        (iii) upon special call by the Commission, provide to the
      Commission, in a form and manner and within the period specified
      in the special call, such information related to its business as
      an electronic trading facility exempt under paragraph (3),
      including information relating to data entry and transaction
      details in respect of transactions entered into in reliance on
      the exemption set forth in paragraph (3), as the Commission may
      determine appropriate - 
          (I) to enforce the provisions specified in subparagraphs (B)
        and (C) of paragraph (4);
          (II) to evaluate a systemic market event; or
          (III) to obtain information requested by a Federal financial
        regulatory authority in order to enable the regulator to
        fulfill its regulatory or supervisory responsibilities;

        (C)(i) upon receipt of any subpoena issued by or on behalf of
      the Commission to any foreign person who the Commission believes
      is conducting or has conducted transactions in reliance on the
      exemption set forth in paragraph (3) on or through the electronic
      trading facility relating to the transactions, promptly notify
      the foreign person of, and transmit to the foreign person, the
      subpoena in a manner reasonable under the circumstances, or as
      specified by the Commission; and
        (ii) if the Commission has reason to believe that a person has
      not timely complied with a subpoena issued by or on behalf of the
      Commission pursuant to clause (i), and the Commission in writing
      has directed that a facility relying on the exemption set forth
      in paragraph (3) deny or limit further transactions by the
      person, the facility shall deny that person further trading
      access to the facility or, as applicable, limit that person's
      access to the facility for liquidation trading only;
        (D) comply with the requirements of this paragraph applicable
      to the facility and require that each participant, as a condition
      of trading on the facility in reliance on the exemption set forth
      in paragraph (3), agree to comply with all applicable law;
        (E) have a reasonable basis for believing that participants
      authorized to conduct transactions on the facility in reliance on
      the exemption set forth in paragraph (3) are eligible commercial
      entities; and
        (F) not represent to any person that the facility is registered
      with, or designated, recognized, licensed, or approved by the
      Commission.

      (6) A person named in a subpoena referred to in paragraph (5)(C)
    that believes the person is or may be adversely affected or
    aggrieved by action taken by the Commission under this section,
    shall have the opportunity for a prompt hearing after the
    Commission acts under procedures that the Commission shall
    establish by rule, regulation, or order.
    (i) Application of commodity futures laws
      (1) No provision of this chapter shall be construed as implying
    or creating any presumption that - 
        (A) any agreement, contract, or transaction that is excluded
      from this chapter under subsection (c), (d), (e), (f), or (g) of
      this section or title IV of the Commodity Futures Modernization
      Act of 2000 [7 U.S.C. 27 to 27f], or exempted under subsection
      (h) of this section or section 6(c) of this title; or
        (B) any agreement, contract, or transaction, not otherwise
      subject to this chapter, that is not so excluded or exempted,

    is or would otherwise be subject to this chapter.
      (2) No provision of, or amendment made by, the Commodity Futures
    Modernization Act of 2000 shall be construed as conferring
    jurisdiction on the Commission with respect to any such agreement,
    contract, or transaction, except as expressly provided in section
    7a of this title (to the extent provided in section 7a(g) of this
    title), 7a-1 of this title, or 7a-3 of this title.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 2, 42 Stat. 998; June 15, 1936, ch.
    545, Secs. 2, 3, 49 Stat. 1491; Apr. 7, 1938, ch. 108, 52 Stat.
    205; Oct. 9, 1940, ch. 786, Sec. 1, 54 Stat. 1059; Aug. 28, 1954,
    ch. 1041, title VII, Sec. 710(a), 68 Stat. 913; July 26, 1955, ch.
    382, Sec. 1, 69 Stat. 375; Pub. L. 90-258, Sec. 1, Feb. 19, 1968,
    82 Stat. 26; Pub. L. 90-418, July 23, 1968, 82 Stat. 413; Pub. L.
    93-463, title I, Sec. 101(a), title II, Secs. 201, 202, Oct. 23,
    1974, 88 Stat. 1389, 1395; Pub. L. 95-405, Sec. 2, Sept. 30, 1978,
    92 Stat. 865; Pub. L. 97-444, title I, Sec. 101, title II, Secs.
    201, 202, Jan. 11, 1983, 96 Stat. 2294, 2297, 2298; Pub. L. 99-641,
    title I, Sec. 110(1), Nov. 10, 1986, 100 Stat. 3561; Pub. L. 102-
    546, title II, Secs. 209(b)(1), 215, 226, title IV, Sec. 404(b),
    title V, Sec. 501, Oct. 28, 1992, 106 Stat. 3606, 3611, 3618, 3628;
    Pub. L. 106-554, Sec. 1(a)(5) [title I, Secs. 102 - 105(b), 106,
    107, 123(a)(2), title II, Sec. 251(a), (b), (i), (j)], Dec. 21,
    2000, 114 Stat. 2763, 2763A-376 to 2763A-379, 2763A-382, 2763A-405,
    2763A-436, 2763A-441, 2763A-445; Pub. L. 107-171, title X, Sec.
    10702(a), May 13, 2002, 116 Stat. 516.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      Section 77b(1) of title 15, referred to in subsec. (a)(1)(C)(i),
    was redesignated section 77b(a)(1) of title 15 by Pub. L. 104-290,
    title I, Sec. 106(a)(1), Oct. 11, 1996, 110 Stat. 3424.
      The Securities Exchange Act of 1934, referred to in subsec.
    (a)(1)(D)(i)(VI), (iii)(II), is act June 6, 1934, ch. 404, 48 Stat.
    881, as amended, which is classified principally to chapter 2B
    (Sec. 78a et seq.) of Title 15, Commerce and Trade. For complete
    classification of this Act to the Code, see section 78a of Title 15
    and Tables.
      The Commodity Futures Modernization Act of 2000, referred to in
    subsec. (i)(1)(A), (2), is H.R. 5660, as enacted by Pub. L. 106-
    554, Sec. 1(a)(5), Dec. 21, 2000, 114 Stat. 2763, 2763A-365. Title
    IV of the Act, known as the Legal Certainty for Bank Products Act
    of 2000, is classified to sections 27 to 27f of this title. For
    complete classification of this Act to the Code, see Short Title of
    2000 Amendment note set out under section 1 of this title, and
    Tables.

-COD-
                               CODIFICATION                           
      Subsec. (a)(1)(B) of this section was formerly classified to
    section 4 of this title. Subsec. (a)(1)(C) of this section was
    formerly classified to section 2a of this title. Subsec. (a)(2) to
    (11) of this section was formerly classified to section 4a of this
    title. Subsec. (b) of this section was formerly classified to
    section 3 of this title.

-MISC1-
                                AMENDMENTS                            
      2002 - Subsec. (a)(7) to (12). Pub. L. 107-171 added par. (7) and
    redesignated former pars. (7) to (11) as (8) to (12), respectively.
      2000 - Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(2)(A)], inserted section catchline.
      Subsec. (a). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(2)(A)], inserted headings for subsec. (a) and par. (1).
      Subsec. (a)(1)(A). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(2)(B)(i)(II)], substituted "contract market designated or
    derivatives transaction execution facility registered pursuant to
    section 7 or 7a of this title" for "contract market designated
    pursuant to section 7 of this title".
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(2)(B)(i)(I)],
    which directed substitution of "subparagraphs (C) and (D) of this
    paragraph and subsections (c) through (i) of this section" for
    "subparagraph (B) of this subparagraph", was executed by making the
    substitution for "subparagraph (B) of this paragraph" to reflect
    the probable intent of Congress.
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(2)(A)],
    inserted heading and struck out "(i)" before "The Commission shall
    have".
      Subsec. (a)(1)(A)(ii). Pub. L. 106-554, Sec. 1(a)(5) [title I,
    Sec. 123(a)(2)(B)(i)(III)], struck out cl. (ii) which read as
    follows: "Nothing in this chapter shall be deemed to govern or in
    any way be applicable to transactions in foreign currency, security
    warrants, security rights, resales of installment loan contracts,
    repurchase options, government securities, or mortgages and
    mortgage purchase commitments, unless such transactions involve the
    sale thereof for future delivery conducted on a board of trade."
      Subsec. (a)(1)(B). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(2)(B)(i)(IV)], redesignated subsec. (a)(1)(A)(iii) as
    subsec. (a)(1)(B) and inserted heading. Former subsec. (a)(1)(B)
    redesignated (a)(1)(C).
      Subsec. (a)(1)(C). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(2)(B)(ii)(I)], redesignated subpar. (B) as (C).
      Subsec. (a)(1)(C)(i). Pub. L. 106-554, Sec. 1(a)(5) [title I,
    Sec. 123(a)(2)(B)(ii)(III)], adjusted margins.
      Subsec. (a)(1)(C)(ii). Pub. L. 106-554, Sec. 1(a)(5) [title II,
    Sec. 251(a)(1)(A)(iii)], substituted "or the derivatives
    transaction execution facility, and the applicable contract, meet"
    for "making such application demonstrates and the Commission
    expressly finds that the specific contract (or option on such
    contract) with respect to which the application has been made
    meets" in introductory provisions.
      Pub. L. 106-554, Sec. 1(a)(5) [title II, Sec. 251(a)(1)(A)(ii)],
    which directed insertion of ", and no derivatives transaction
    execution facility shall trade or execute such contracts of sale
    (or options on such contracts) for future delivery," after
    "contracts) for future delivery", was executed by making the
    insertion in the proviso in introductory provisions to reflect the
    probable intent of Congress.
      Pub. L. 106-554, Sec. 1(a)(5) [title II, Sec. 251(a)(1)(A)(i)],
    inserted "or register a derivatives transaction execution facility
    that trades or executes," after "contract market in," in
    introductory provisions.
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(2)(B)(ii)(III)], adjusted margins.
      Subsec. (a)(1)(C)(ii)(III). Pub. L. 106-554, Sec. 1(a)(5) [title
    II, Sec. 251(a)(1)(A)(iv)], added subcl. (III) and struck out
    former subcl. (III) which read as follows: "Such group or index of
    securities shall be predominately composed of the securities of
    unaffiliated issuers and shall be a widely published measure of,
    and shall reflect, the market for all publicly traded equity or
    debt securities or a substantial segment thereof, or shall be
    comparable to such measure."
      Subsec. (a)(1)(C)(iii). Pub. L. 106-554, Sec. 1(a)(5) [title II,
    Sec. 251(a)(1)(B), (C)], added cl. (iii) and struck out former cl.
    (iii) which read as follows: "Upon application by a board of trade
    for designation as a contract market with respect to any contract
    of sale (or option on such contract) for future delivery involving
    a group or index of securities, the Commission shall provide an
    opportunity for public comment on whether such contracts (or
    options on such contracts) meet the minimum requirements set forth
    in clause (ii) of this subparagraph."
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(2)(B)(ii)(III)], adjusted margins.
      Subsec. (a)(1)(C)(iv). Pub. L. 106-554, Sec. 1(a)(5) [title II,
    Sec. 251(a)(1)(C), (D)], redesignated cl. (v) as (iv) and struck
    out former cl. (iv) which related to consultation by the Commission
    with, and the authority of, the Securities and Exchange Commission
    with respect to approval of any application by a Board of Trade for
    designation as a contract market with respect to any contract of
    sale (or option of such contract) for future delivery of a group or
    index of securities.
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(2)(B)(ii)(III)], adjusted margins.
      Subsec. (a)(1)(C)(v). Pub. L. 106-554, Sec. 1(a)(5) [title II,
    Sec. 251(b)(2)], redesignated cl. (vi) as (v), added subcls. (I) to
    (V), and struck out former subcls. (I) to (IV) which required any
    contract market in a stock index futures contract (or option
    thereon) to file with the Board of Governors of the Federal Reserve
    System any rule establishing or changing the levels of margin for
    the stock index futures contract (or option thereon), authorized
    the Board to request any contract market to set the margins at
    certain levels, authorized the Board to delegate its authority
    under this clause to the Commission, and preserved the authority of
    the Commission to raise temporary emergency margin levels.
      Pub. L. 106-554, Sec. 1(a)(5) [title II, Sec. 251(a)(1)(D)],
    redesignated cl. (v) as (iv).
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(2)(B)(ii)(II), (III)], struck out "section 77c of title 15"
    after "exempted security under", inserted "or subparagraph (D)"
    after "subparagraph", and adjusted margins.
      Subsec. (a)(1)(C)(vi). Pub. L. 106-554, Sec. 1(a)(5) [title II,
    Sec. 251(b)(2)], redesignated cl. (vi) as (v).
      Pub. L. 106-554, Sec. 1(a)(5) [title II, Sec. 251(b)(1)],
    redesignated subcl. (V) as (VI).
      Subsec. (a)(1)(D). Pub. L. 106-554, Sec. 1(a)(5) [title II, Sec.
    251(a)(2)], added subpar. (D).
      Subsec. (a)(1)(E). Pub. L. 106-554, Sec. 1(a)(5) [title II, Sec.
    251(i)], added subpar. (E).
      Subsec. (a)(1)(F). Pub. L. 106-554, Sec. 1(a)(5) [title II, Sec.
    251(j)], added subpar. (F).
      Subsec. (a)(2) to (6). Pub. L. 106-554, Sec. 1(a)(5) [title I,
    Sec. 123(a)(2)(E)], adjusted margins.
      Subsec. (a)(7). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(2)(C), (E)], substituted "registered entity" for "contract
    market" and adjusted margins.
      Subsec. (a)(8). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(2)(E)], adjusted margins.
      Subsec. (a)(8)(B)(ii). Pub. L. 106-554, Sec. 1(a)(5) [title I,
    Sec. 123(a)(2)(D)(iii)], in last sentence, substituted
    "designating, registering, or refusing, suspending, or revoking the
    designation or registration of, a board of trade as a contract
    market or derivatives transaction execution facility involving
    transactions for future delivery referred to in this clause or in
    considering any possible action under this chapter (including
    without limitation emergency action under section 12a(9) of this
    title)" for "designating, or refusing, suspending, or revoking the
    designation of, a board of trade as a contract market involving
    transactions for future delivery referred to in this clause or in
    considering possible emergency action under section 12a(9) of this
    title" and "designation, registration, suspension, revocation, or
    action" for "designation, suspension, revocation, or emergency
    action".
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(2)(D)(ii)],
    substituted "designate or register a board of trade as a contract
    market or derivatives transaction execution facility" for
    "designate a board of trade as a contract market" in second
    sentence.
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(2)(D)(i)],
    substituted "designation or registration as a contract market or
    derivatives transaction execution facility" for "designation as a
    contract market" in first sentence.
      Subsec. (a)(9). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(2)(E)], adjusted margins.
      Subsec. (c). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 102],
    added subsec. (c).
      Subsec. (d). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 103],
    added subsec. (d).
      Subsec. (e). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 104],
    added subsec. (e).
      Subsec. (f). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    105(a)], added subsec. (f).
      Subsec. (g). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    105(b)], added subsec. (g).
      Subsec. (h). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 106],
    added subsec. (h).
      Subsec. (i). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 107],
    added subsec. (i).
      1992 - Subsec. (a)(1)(A). Pub. L. 102-546, Sec. 404(b)(2)-(7),
    redesignated cls. (i) and (ii) of former third sentence as subcls.
    (I) and (II), respectively, designated former fifth sentence as cl.
    (ii), designated former eighth sentence as cl. (iii), and struck
    out former sixth, seventh, and ninth through last sentences, which
    included definitions of "future delivery", "board of trade",
    "interstate commerce", "cooperative association of producers",
    "member of a contract market", "futures commission merchant",
    "introducing broker", "floor broker", "the Commission", "commodity
    trading advisor", and "commodity pool operator". See section 1a of
    this title.
      Pub. L. 102-546, Sec. 404(b)(1), which directed the substitution
    of "(i) The Commission" for the words "For the purposes" and all
    that followed through "; Provided, That the Commission", was
    executed by making the substitution for the first and second
    sentences and the third sentence through the words ": Provided,
    That the Commission", to reflect the probable intent of Congress.
    Prior to amendment, the first, second, and third sentences included
    definitions of "contract of sale", "person", and "commodity". See
    section 1a of this title.
      Subsec. (a)(1)(B)(iv)(I). Pub. L. 102-546, Sec. 209(b)(1)(A),
    made technical amendment to reference to section 9 of this title
    appearing in penultimate sentence to reflect change in reference to
    corresponding section of original act.
      Subsec. (a)(1)(B)(iv)(II). Pub. L. 102-546, Sec. 209(b)(1)(B),
    substituted "section 8(b)" for "section 8".
      Subsec. (a)(1)(B)(vi). Pub. L. 102-546, Sec. 501, added cl. (vi).
      Subsec. (a)(2)(A). Pub. L. 102-546, Sec. 215, substituted second
    and third sentences for "The Commission shall be composed of five
    Commissioners, who shall be appointed by the President, by and with
    the advice and consent of the Senate. In nominating persons for
    appointment, the President shall seek to establish and maintain a
    balanced Commission, including, but not limited to, persons of
    demonstrated knowledge in futures trading or its regulation and
    persons of demonstrated knowledge in the production, merchandising,
    processing or distribution of one or more of the commodities or
    other goods and articles, services, rights and interests covered by
    this chapter."
      Subsec. (a)(9)(C). Pub. L. 102-546, Sec. 226, added subpar. (C).
      1986 - Subsec. (a)(1)(B)(iv)(I). Pub. L. 99-641 substituted
    "Securities and Exchange Commission" for "Securities Exchange
    Commission" before "otherwise agree".
      1983 - Subsec. (a)(1). Pub. L. 97-444, Sec. 101, designated
    existing provisions as subpar. (A), inserted in third sentence,
    first proviso, ", except to the extent otherwise provided in
    subparagraph (B) of this paragraph," after "exclusive
    jurisdiction", and added subpar. (B).
      Subsec. (a)(1)(A). Pub. L. 97-444, Sec. 201, inserted definition
    of "introducing broker" and, in revising definition of "commodity
    training advisor", included any person advising others through
    electronic media; substituted provision respecting advising others
    "as to the value of or the advisability of trading in any contract
    of sale of a commodity for future delivery made or to be made on or
    subject to the rules of a contract market, any commodity option
    authorized under section 6c of this title, or any leverage
    transaction authorized under section 23 of this title, or who, for
    compensation or profit, and as part of a regular business, issues
    or promulgates analyses or reports concerning any of the foregoing"
    for provision respecting advising others "as to the value of
    commodities or as to the advisability of trading in any commodity
    for future delivery on or subject to the rules of any market, or
    who for compensation or profit, and as part of a regular business,
    issues or promulgates analyses or reports concerning commodities";
    excluded in item (i) any person acting as an employee of any bank
    or trust company; substituted in cl. (ii) "news reporter, news
    columnist, or news editor of the print or electronic media" for
    "newspaper reporter, newspaper columnist, newspaper editor";
    substituted in cl. (iv) "the publisher or producer of any print or
    electronic data of general and regular dissemination, including its
    employees" for "the publisher of any bona fide newspaper magazine,
    or business or financial publication of general and regular
    circulation including their employees"; inserted item (v);
    redesignated as items (vi) and (vii) former items (v) and (vi); and
    authorized Commission to effectuate purposes of definition by rule
    or regulation by including within definition any person advising as
    to the value of commodities or issuing reports or analyses
    concerning commodities.
      Subsec. (a)(7). Pub. L. 97-444, Sec. 202, struck out "(A)" after
    "(7)" and struck out subpar. (B) which prohibited any
    representative activities before the Commission for a one year
    period upon termination of employment occurring on a day more than
    four months after Sept. 30, 1978, of any Commissioner or employee
    of the Commission having a GS-16 or higher classified position
    excepted from the competitive service because of its confidential
    or policymaking character.
      1978 - Subsec. (a)(1). Pub. L. 95-405, Sec. 2(1), substituted
    "section 23 of this title" for "section 15a of this title".
      Subsec. (a)(2). Pub. L. 95-405, Sec. 2(2)-(5), designated
    existing provisions as subpar. (A) and substituted "five
    Commissioners" for "a chairman and four other Commissioners", "(i)"
    for "(A)", and "(ii)" for "(B)", and added subpar. (B).
      Subsec. (a)(5). Pub. L. 95-405, Sec. 2(6), struck out ", by and
    with the advice and consent of the Senate," after "by the
    Commission".
      Subsec. (a)(6)(A). Pub. L. 95-405, Sec. 2(7), inserted "according
    to budget categories, plans, programs, and priorities established
    and approved by the Commission," after "expenditure of funds,".
      Subsec. (a)(6)(B). Pub. L. 95-405, Sec. 2(8), substituted ",
    plans, priorities, and budgets approved by the Commission" for "of
    the Commission".
      Subsec. (a)(7). Pub. L. 95-405, Sec. 2(9), (10), designated
    existing provisions as subpar. (A) and added subpar. (B).
      Subsec. (a)(8). Pub. L. 95-405, Sec. 2(11)-(13), designated
    existing provisions as subpar. (A), substituted "maintain" for
    "establish a separate office within the Department of Agriculture
    to be staffed with employees of the Commission for the purpose of
    maintaining", and added subpar. (B).
      Subsec. (a)(9)(A), (B). Pub. L. 95-405, Sec. 2(14), (15),
    substituted "Senate Committee on Agriculture, Nutrition, and
    Forestry" for "Senate Committee on Agriculture and Forestry".
      1974 - Subsec. (a). Pub. L. 93-463, Sec. 101(a), designated
    existing provisions as par. (1), substituted "Commodity Futures
    Trading Commission established under paragraph (2) of this
    subsection" for "Commodity Exchange Commission, consisting of the
    Secretary of Agriculture, the Secretary of Commerce, and the
    Attorney General, or an official or employee of each of the
    executive departments concerned, designated by the Secretary of
    Agriculture, the Secretary of Commerce, and the Attorney General,
    respectively; and the Secretary of Agriculture or his designee
    shall serve as Chairman", and added pars. (2) to (11).
      Subsec. (a)(1). Pub. L. 93-463, Secs. 201, 202, struck out
    "onions," after "eggs," in definition of "commodity" and inserted
    provisions to that definition to include as commodities all other
    goods and articles, except onions as provided in section 13-1 of
    this title, and all services, rights, and interests in which
    contracts for the future delivery are presently or in the future
    dealt in, and inserted definitions for "commodity trading advisor"
    and "commodity pool operator".
      1968 - Subsec. (a). Pub. L. 90-418 extended definition of
    "commodity" in third sentence to include frozen concentrated orange
    juice.
      Pub. L. 90-258, Sec. 1(c), provided in last sentence for
    representation on the Commission of Secretary of Agriculture,
    Secretary of Commerce, and Attorney General by an official or
    employee designated from executive department concerned and for
    service of Secretary of Agriculture or his designee as Chairman.
      Pub. L. 90-258, Sec. 1(b), substituted in definition of "floor
    broker" in penultimate sentence "purchase or sell for any other
    person" for "engage in executing for others any order for the
    purchase or sale of" and struck out provision for receipt or
    acceptance of any commission or other compensation for services as
    a floor broker.
      Pub. L. 90-258, Sec. 1(a), extended definition of "commodity" in
    third sentence to include livestock and livestock products.
      1955 - Subsec. (a). Act July 26, 1955, extended "commodity" to
    onions.
      1954 - Subsec. (a). Act Aug. 28, 1954, extended "commodity" to
    wool.
      1940 - Subsec. (a). Act Oct. 9, 1940, extended "commodity" to
    fats and oils (including lard, tallow, cottonseed oil, peanut oil,
    soybean oil, and all other fats and oils), cottonseed meal,
    cottonseed, peanuts, soybeans and soybean meal.
      1938 - Subsec. (a). Act Apr. 7, 1938, extended "commodity" to
    wool tops.
      1936 - Subsec. (a). Act June 15, 1936, substituted "commodity",
    "any commodity", or "commodities", as the case may require, for
    "grain" wherever appearing, and "any cash commodity" for "cash
    grain", substituted sentence defining "commodity" for sentence
    defining "grain", and inserted definitions of "cooperative
    association of producers,", "member of a contract market", "futures
    commission merchant", "floor broker", and "the commission."
      Subsec. (b). Act June 15, 1936, Sec. 2, substituted "commodity"
    and "commodities", as the case may require, for "grain" wherever
    appearing.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Section 239 of Pub. L. 97-444 provided that: "This Act [see Short
    Title of 1983 Amendment note set out under section 1 of this title]
    shall be effective upon the date of enactment of this Act [Jan. 11,
    1983], except that sections 207, 212, and 231 of this Act [amending
    sections 6d, 6k, and 18 of this title] shall be effective one
    hundred and twenty days after the date of enactment of this Act, or
    such earlier date as the Commodity Futures Trading Commission shall
    prescribe by regulation."

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Section 28 of Pub. L. 95-405 provided that: "Except as otherwise
    provided in this Act, the provisions of this Act [see Short Title
    of 1978 Amendment note set out under section 1 of this title] shall
    become effective October 1, 1978."

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      Pub. L. 93-463, title IV, Sec. 418, Oct. 23, 1974, 88 Stat. 1415,
    provided that:
      "(a) Except as otherwise provided specifically in this Act [see
    Short Title of 1974 Amendment note set out under section 1 of this
    title], the effective date of this Act shall be the 180th day after
    enactment [Oct. 23, 1974]. The Commission referred to in section
    101 [Commodity Futures Trading Commission] is hereby established
    effective immediately on enactment of this Act. Sections 102 and
    410 [amending sections 5108, 5314, 5315, and 5316 of Title 5,
    Government Organization and Employees] shall be effective
    immediately on enactment of this Act. Activities necessary to
    implement the changes effected by this Act may be carried out after
    the date of enactment and before as well as after the 180th day
    thereafter. Activities to be carried out after the date of
    enactment and before the 180th day thereafter may include, but are
    not limited to the following: Designation of boards of trade as
    contract markets, registration of futures commission merchants,
    floor brokers, and other persons required to be registered under
    the Act [this chapter], approval or modification of bylaws, rules,
    regulations, and resolutions of contract markets, and issuance of
    regulations, effective on or after the 180th day after enactment;
    appointment and compensation of the members of the Commission;
    hiring and compensation of staff; and conducting of investigations
    and hearings. Nothing in this Act shall limit the authority of the
    Secretary of Agriculture or the Commodity Exchange Commission under
    the Commodity Exchange Act [7 U.S.C. 1 et seq.], as amended, prior
    to the 180th day after enactment of this Act.
      "(b) Funds appropriated for the administration of the Commodity
    Exchange Act, as amended [7 U.S.C. 1 et seq.], may be used to
    implement this Act immediately after the date of enactment of this
    Act [Oct. 23, 1974]."

                     EFFECTIVE DATE OF 1968 AMENDMENT                 
      Section 28 of Pub. L. 90-258 provided that: "This Act [enacting
    sections 12b, 13b, 13c, and 17b, and amending this section and
    sections 6a, 6b, 6d, 6f, 6g, 6i, 7, 7a, 7b, 8, 9, 12, 12-1, 12a,
    13, and 13a of this title] shall become effective one hundred and
    twenty days after enactment [Feb. 19, 1968]."

                     EFFECTIVE DATE OF 1955 AMENDMENT                 
      Section 2 of act July 26, 1955, provided that: "This Act
    [amending this section] shall take effect sixty days after the date
    of its enactment [July 26, 1955]."

                     EFFECTIVE DATE OF 1954 AMENDMENT                 
      Section 710(b) of act Aug. 28, 1954, which provided that the
    amendment of this section by act Aug. 28, 1954, was effective 60
    days after Aug. 28, 1954, was repealed by Pub. L. 103-130, Sec.
    3(a), Nov. 1, 1993, 107 Stat. 1369, eff. Dec. 31, 1995.

                     EFFECTIVE DATE OF 1940 AMENDMENT                 
      Section 2 of act Oct. 9, 1940, provided that: "This Act [amending
    this section] shall take effect sixty days after the date of its
    enactment [Oct. 9, 1940]."

                     EFFECTIVE DATE OF 1936 AMENDMENT                 
      Amendment by act June 15, 1936, effective 90 days after June 15,
    1936, see section 13 of that act, set out as a note under section 1
    of this title.

                      SEPARABILITY OF 1974 AMENDMENT                  
      Pub. L. 93-463, title IV, Sec. 413, Oct. 23, 1974, 88 Stat. 1414,
    provided that: "If any provision of this Act [see Short Title of
    1974 Amendment note set out under section 1 of this title] or the
    application thereof to any person or circumstances is held invalid,
    the validity of the remainder of the Act and the application of
    such provisions to other persons or circumstances shall not be
    affected thereby."

                       STUDY REGARDING RETAIL SWAPS                   
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 105(c)], Dec. 21,
    2000, 114 Stat. 2763, 2763A-379, provided that:
      "(1) In general. - The Board of Governors of the Federal Reserve
    System, the Secretary of the Treasury, the Commodity Futures
    Trading Commission, and the Securities and Exchange Commission
    shall conduct a study of issues involving the offering of swap
    agreements to persons other than eligible contract participants (as
    defined in section 1a of the Commodity Exchange Act [7 U.S.C. 1a]).
      "(2) Matters to be addressed. - The study shall address - 
        "(A) the potential uses of swap agreements by persons other
      than eligible contract participants;
        "(B) the extent to which financial institutions are willing to
      offer swap agreements to persons other than eligible contract
      participants;
        "(C) the appropriate regulatory structure to address customer
      protection issues that may arise in connection with the offer of
      swap agreements to persons other than eligible contract
      participants; and
        "(D) such other relevant matters deemed necessary or
      appropriate to address.
      "(3) Report. - Before the end of the 1-year period beginning on
    the date of the enactment of this Act [Dec. 21, 2000], a report on
    the findings and conclusions of the study required by paragraph (1)
    shall be submitted to Congress, together with such recommendations
    for legislative action as are deemed necessary and appropriate."

                      EDUCATIONAL EVENTS AND SYMPOSIA                  
      Pub. L. 106-78, title VI, Oct. 22, 1999, 113 Stat. 1160, provided
    in part: "That for fiscal year 2000 and thereafter, the Commission
    [Commodity Futures Trading Commission] is authorized to charge
    reasonable fees to attendees of Commission sponsored educational
    events and symposia to cover the Commission's costs of providing
    those events and symposia, and notwithstanding 31 U.S.C. 3302, said
    fees shall be credited to this account, to be available without
    further appropriation."
      Similar provisions were contained in the following prior
    appropriations acts:
      Pub. L. 105-277, div. A, Sec. 101(a) [title VI], Oct. 21, 1998,
    112 Stat. 2681, 2681-24.
      Pub. L. 105-86, title VI, Nov. 18, 1997, 111 Stat. 2104.
      Pub. L. 104-180, title VI, Aug. 6, 1996, 110 Stat. 1596.
      Pub. L. 104-37, title VI, Oct. 21, 1995, 109 Stat. 327.
      Pub. L. 103-330, title VI, Sept. 30, 1994, 108 Stat. 2466.

                   NON-ABATEMENT OF PENDING PROCEEDINGS               
      Pub. L. 93-463, title IV, Sec. 412, Oct. 23, 1974, 88 Stat. 1414,
    provided that: "Pending proceedings under existing law shall not be
    abated by reason of any provision of this Act [see Short Title of
    1974 Amendment note set out under section 1 of this title] but
    shall be disposed of pursuant to the applicable provisions of the
    Commodity Exchange Act, as amended [7 U.S.C. 1 et seq.], in effect
    prior to the effective date of this Act [see Effective Date of 1974
    Amendment note above]."

-FOOTNOTE-
    (!1) See References in Text note below.

    (!2) So in original. The word "or" probably should not appear.

    (!3) So in original. Probably should be subclause "(III)".

    (!4) Probably should refer to the second par. (5) of section 6k.

    (!5) So in original. Probably should be followed by a closing
         parenthesis.

    (!6) So in original. The closing parenthesis probably should not
         appear.

-End-

-CITE-
    7 USC Secs. 2a to 4a                                        01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Secs. 2a to 4a. Transferred

-COD-
                               CODIFICATION                           
      Section 2a, act Sept. 21, 1922, ch. 369, Sec. 2(a)(1)(C),
    formerly Sec. 2(a)(1)(B), as added Pub. L. 97-444, title I, Sec.
    101(a)(3), Jan. 11, 1983, 96 Stat. 2294, and amended and
    renumbered, which related to designation of boards of trade as
    contract markets and approval by and jurisdiction of Commodity
    Futures Trading Commission and Securities and Exchange Commission,
    was transferred to section 2(a)(1)(C) of this title.
      Section 3, act Sept. 21, 1922, ch. 369, Sec. 2(b), 42 Stat. 998,
    as amended, which related to transactions in interstate commerce,
    was transferred to section 2(b) of this title.
      Section 4, act Sept. 21, 1922, ch. 369, Sec. 2(a)(1)(B), formerly
    Sec. 2(a), 42 Stat. 998, as amended and renumbered, which related
    to liability of principal for act of agent, was transferred to
    section 2(a)(1)(B) of this title.
      Section 4a, act Sept. 21, 1922, ch. 369, Sec. 2(a)(2)-(11), as
    added Pub. L. 93-463, title I, Sec. 101(a)(3), Oct. 23, 1974, 88
    Stat. 1389, and amended, which related to the Commodity Futures
    Trading Commission, was transferred to section 2(a)(2) to (11) of
    this title.

-End-

-CITE-
    7 USC Sec. 5                                                01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 5. Findings and purpose

-STATUTE-
    (a) Findings
      The transactions subject to this chapter are entered into
    regularly in interstate and international commerce and are affected
    with a national public interest by providing a means for managing
    and assuming price risks, discovering prices, or disseminating
    pricing information through trading in liquid, fair and financially
    secure trading facilities.
    (b) Purpose
      It is the purpose of this chapter to serve the public interests
    described in subsection (a) of this section through a system of
    effective self-regulation of trading facilities, clearing systems,
    market participants and market professionals under the oversight of
    the Commission. To foster these public interests, it is further the
    purpose of this chapter to deter and prevent price manipulation or
    any other disruptions to market integrity; to ensure the financial
    integrity of all transactions subject to this chapter and the
    avoidance of systemic risk; to protect all market participants from
    fraudulent or other abusive sales practices and misuses of customer
    assets; and to promote responsible innovation and fair competition
    among boards of trade, other markets and market participants.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 3, as added Pub. L. 106-554, Sec.
    1(a)(5) [title I, Sec. 108], Dec. 21, 2000, 114 Stat. 2763, 2763A-
    383.)

-MISC1-
                             PRIOR PROVISIONS                         
      A prior section 5, acts Sept. 21, 1922, ch. 369, Sec. 3, 42 Stat.
    999; June 15, 1936, ch. 545, Sec. 2, 49 Stat. 1491; Pub. L. 97-444,
    title II, Sec. 203, Jan. 11, 1983, 96 Stat. 2298, stated
    legislative findings, prior to repeal by Pub. L. 106-554, Sec.
    1(a)(5) [title I, Sec. 108], Dec. 21, 2000, 114 Stat. 2763, 2763A-
    383.

-End-

-CITE-
    7 USC Sec. 6                                                01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6. Regulation of futures trading and foreign transactions

-STATUTE-
    (a) Restriction on futures trading
      Unless exempted by the Commission pursuant to subsection (c) of
    this section, it shall be unlawful for any person to offer to enter
    into, to enter into, to execute, to confirm the execution of, or to
    conduct any office or business anywhere in the United States, its
    territories or possessions, for the purpose of soliciting or
    accepting any order for, or otherwise dealing in, any transaction
    in, or in connection with, a contract for the purchase or sale of a
    commodity for future delivery (other than a contract which is made
    on or subject to the rules of a board of trade, exchange, or market
    located outside the United States, its territories or possessions)
    unless - 
        (1) such transaction is conducted on or subject to the rules of
      a board of trade which has been designated or registered by the
      Commission as a contract market or derivatives transaction
      execution facility for such commodity;
        (2) such contract is executed or consummated by or through a
      contract market; and
        (3) such contract is evidenced by a record in writing which
      shows the date, the parties to such contract and their addresses,
      the property covered and its price, and the terms of delivery:
      Provided, That each contract market or derivatives transaction
      execution facility member shall keep such record for a period of
      three years from the date thereof, or for a longer period if the
      Commission shall so direct, which record shall at all times be
      open to the inspection of any representative of the Commission or
      the Department of Justice.
    (b) Regulation of foreign transactions by United States persons
      The Commission may adopt rules and regulations proscribing fraud
    and requiring minimum financial standards, the disclosure of risk,
    the filing of reports, the keeping of books and records, the
    safeguarding of customers' funds, and registration with the
    Commission by any person located in the United States, its
    territories or possessions, who engages in the offer or sale of any
    contract of sale of a commodity for future delivery that is made or
    to be made on or subject to the rules of a board of trade,
    exchange, or market located outside the United States, its
    territories or possessions. Such rules and regulations may impose
    different requirements for such persons depending upon the
    particular foreign board of trade, exchange, or market involved. No
    rule or regulation may be adopted by the Commission under this
    subsection that (1) requires Commission approval of any contract,
    rule, regulation, or action of any foreign board of trade,
    exchange, or market, or clearinghouse for such board of trade,
    exchange, or market, or (2) governs in any way any rule or contract
    term or action of any foreign board of trade, exchange, or market,
    or clearinghouse for such board of trade, exchange, or market.
    (c) Public interest exemptions
      (1) In order to promote responsible economic or financial
    innovation and fair competition, the Commission by rule,
    regulation, or order, after notice and opportunity for hearing, may
    (on its own initiative or on application of any person, including
    any board of trade designated or registered as a contract market or
    derivatives transaction execution facility for transactions for
    future delivery in any commodity under section 7 of this title)
    exempt any agreement, contract, or transaction (or class thereof)
    that is otherwise subject to subsection (a) of this section
    (including any person or class of persons offering, entering into,
    rendering advice or rendering other services with respect to, the
    agreement, contract, or transaction), either unconditionally or on
    stated terms or conditions or for stated periods and either
    retroactively or prospectively, or both, from any of the
    requirements of subsection (a) of this section, or from any other
    provision of this chapter (except subparagraphs (C)(ii) and (D) of
    section 2(a)(1) of this title, except that the Commission and the
    Securities and Exchange Commission may by rule, regulation, or
    order jointly exclude any agreement, contract, or transaction from
    section 2(a)(1)(D) of this title), if the Commission determines
    that the exemption would be consistent with the public interest.
      (2) The Commission shall not grant any exemption under paragraph
    (1) from any of the requirements of subsection (a) of this section
    unless the Commission determines that - 
        (A) the requirement should not be applied to the agreement,
      contract, or transaction for which the exemption is sought and
      that the exemption would be consistent with the public interest
      and the purposes of this chapter; and
        (B) the agreement, contract, or transaction - 
          (i) will be entered into solely between appropriate persons;
        and
          (ii) will not have a material adverse effect on the ability
        of the Commission or any contract market or derivatives
        transaction execution facility to discharge its regulatory or
        self-regulatory duties under this chapter.

      (3) For purposes of this subsection, the term "appropriate
    person" shall be limited to the following persons or classes
    thereof:
        (A) A bank or trust company (acting in an individual or
      fiduciary capacity).
        (B) A savings association.
        (C) An insurance company.
        (D) An investment company subject to regulation under the
      Investment Company Act of 1940 (15 U.S.C. 80a-1 et seq.).
        (E) A commodity pool formed or operated by a person subject to
      regulation under this chapter.
        (F) A corporation, partnership, proprietorship, organization,
      trust, or other business entity with a net worth exceeding
      $1,000,000 or total assets exceeding $5,000,000, or the
      obligations of which under the agreement, contract or transaction
      are guaranteed or otherwise supported by a letter of credit or
      keepwell, support, or other agreement by any such entity or by an
      entity referred to in subparagraph (A), (B), (C), (H), (I), or
      (K) of this paragraph.
        (G) An employee benefit plan with assets exceeding $1,000,000,
      or whose investment decisions are made by a bank, trust company,
      insurance company, investment adviser registered under the
      Investment Advisers Act of 1940 [15 U.S.C. 80b-1 et seq.], or a
      commodity trading advisor subject to regulation under this
      chapter.
        (H) Any governmental entity (including the United States, any
      state,(!1) or any foreign government) or political subdivision
      thereof, or any multinational or supranational entity or any
      instrumentality, agency, or department of any of the foregoing.

        (I) A broker-dealer subject to regulation under the Securities
      Exchange Act of 1934 (15 U.S.C. 78a et seq.) acting on its own
      behalf or on behalf of another appropriate person.
        (J) A futures commission merchant, floor broker, or floor
      trader subject to regulation under this chapter acting on its own
      behalf or on behalf of another appropriate person.
        (K) Such other persons that the Commission determines to be
      appropriate in light of their financial or other qualifications,
      or the applicability of appropriate regulatory protections.

      (4) During the pendency of an application for an order granting
    an exemption under paragraph (1), the Commission may limit the
    public availability of any information received from the applicant
    if the applicant submits a written request to limit disclosure
    contemporaneous with the application, and the Commission determines
    that - 
        (A) the information sought to be restricted constitutes a trade
      secret; or
        (B) public disclosure of the information would result in
      material competitive harm to the applicant.

      (5) The Commission may - 
        (A) promptly following October 28, 1992, or upon application by
      any person, exercise the exemptive authority granted under
      paragraph (1) with respect to classes of hybrid instruments that
      are predominantly securities or depository instruments, to the
      extent that such instruments may be regarded as subject to the
      provisions of this chapter; or
        (B) promptly following October 28, 1992, or upon application by
      any person, exercise the exemptive authority granted under
      paragraph (1) effective as of October 23, 1974, with respect to
      classes of swap agreements (as defined in section 101 of title
      11) that are not part of a fungible class of agreements that are
      standardized as to their material economic terms, to the extent
      that such agreements may be regarded as subject to the provisions
      of this chapter.

    Any exemption pursuant to this paragraph shall be subject to such
    terms and conditions as the Commission shall determine to be
    appropriate pursuant to paragraph (1).
    (d) Effect of exemption on investigative authority of Commission
      The granting of an exemption under this section shall not affect
    the authority of the Commission under any other provision of this
    chapter to conduct investigations in order to determine compliance
    with the requirements or conditions of such exemption or to take
    enforcement action for any violation of any provision of this
    chapter or any rule, regulation or order thereunder caused by the
    failure to comply with or satisfy such conditions or requirements.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4, 42 Stat. 999; June 15, 1936, ch.
    545, Secs. 2, 4, 49 Stat. 1491, 1492; Pub. L. 93-463, title I, Sec.
    103(a), (f), Oct. 23, 1974, 88 Stat. 1392; Pub. L. 97-444, title
    II, Sec. 204, Jan. 11, 1983, 96 Stat. 2299; Pub. L. 102-546, title
    V, Sec. 502(a), Oct. 28, 1992, 106 Stat. 3629; Pub. L. 106-554,
    Sec. 1(a)(5) [title I, Sec. 123(a)(3)], Dec. 21, 2000, 114 Stat.
    2763, 2763A-406.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Investment Company Act of 1940, referred to in subsec.
    (c)(3)(D), is title I of act Aug. 22, 1940, ch. 686, 54 Stat. 789,
    as amended, which is classified generally to subchapter I (Sec. 80a-
    1 et seq.) of chapter 2D of Title 15, Commerce and Trade. For
    complete classification of this Act to the Code, see section 80a-51
    of Title 15 and Tables.
      The Investment Advisers Act of 1940, referred to in subsec.
    (c)(3)(G), is title II of act Aug. 22, 1940, ch. 686, 54 Stat. 847,
    as amended, which is classified generally to subchapter II (Sec.
    80b-1 et seq.) of chapter 2D of Title 15. For complete
    classification of this Act to the Code, see section 80b-20 of Title
    15 and Tables.
      The Securities Exchange Act of 1934, referred to in subsec.
    (c)(3)(I), is act June 6, 1934, ch. 404, 48 Stat. 881, as amended,
    which is classified principally to chapter 2B (Sec. 78a et seq.) of
    Title 15. For complete classification of this Act to the Code, see
    section 78a of Title 15 and Tables.

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (a)(1). Pub. L. 106-554, Sec. 1(a)(5) [title I,
    Sec. 123(a)(3)(A)(i)], substituted "designated or registered by the
    Commission as a contract market or derivatives transaction
    execution facility for" for "designated by the Commission as a
    'contract market' for".
      Subsec. (a)(2). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(3)(A)(ii)], struck out "member of such" after "by or through
    a".
      Subsec. (a)(3). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(3)(A)(iii)], inserted "or derivatives transaction execution
    facility" after "contract market".
      Subsec. (c)(1). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(3)(B)(i)], substituted "designated or registered as a
    contract market or derivatives transaction execution facility" for
    "designated as a contract market" and "subparagraphs (C)(ii) and
    (D) of section 2(a)(1) of this title, except that the Commission
    and the Securities and Exchange Commission may by rule, regulation,
    or order jointly exclude any agreement, contract, or transaction
    from section 2(a)(1)(D) of this title" for "section 2a of this
    title".
      Subsec. (c)(2)(B)(ii). Pub. L. 106-554, Sec. 1(a)(5) [title I,
    Sec. 123(a)(3)(B)(ii)], inserted "or derivatives transaction
    execution facility" after "contract market".
      1992 - Subsec. (a). Pub. L. 102-546, Sec. 502(a)(1), substituted
    "Unless exempted by the Commission pursuant to subsection (c) of
    this section, it shall be unlawful" for "It shall be unlawful".
      Subsecs. (c), (d). Pub. L. 102-546, Sec. 502(a)(2), added
    subsecs. (c) and (d).
      1983 - Pub. L. 97-444 amended section generally, combining into
    subsec. (a) existing provisions of this section together with
    provisions formerly contained in section 6h(1) of this title,
    relating to the conduct of offices or places of business anywhere
    in the United States or its territories that are used for dealing
    in commodities for future delivery unless such dealings are
    executed or consummated by or through a member of a contract
    market, and adding subsec. (b).
      1974 - Pub. L. 93-463 substituted "Commission" for "Secretary of
    Agriculture" and "United States Department of Agriculture".
      1936 - Act June 15, 1936, Sec. 2, substituted "commodity" for
    "grain" wherever appearing.
      Act June 15, 1936, Sec. 4, struck out par. (a) and combined par.
    (b) with first par.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1936 AMENDMENT                 
      Amendment by act June 15, 1936, effective 90 days after June 15,
    1936, see section 13 of that act, set out as a note under section 1
    of this title.

-FOOTNOTE-
    (!1) So in original. Probably should be capitalized.

-End-

-CITE-
    7 USC Sec. 6a                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6a. Excessive speculation

-STATUTE-
    (a) Burden on interstate commerce; trading or position limits
      Excessive speculation in any commodity under contracts of sale of
    such commodity for future delivery made on or subject to the rules
    of contract markets or derivatives transaction execution facilities
    causing sudden or unreasonable fluctuations or unwarranted changes
    in the price of such commodity, is an undue and unnecessary burden
    on interstate commerce in such commodity. For the purpose of
    diminishing, eliminating, or preventing such burden, the Commission
    shall, from time to time, after due notice and opportunity for
    hearing, by rule, regulation, or order, proclaim and fix such
    limits on the amounts of trading which may be done or positions
    which may be held by any person under contracts of sale of such
    commodity for future delivery on or subject to the rules of any
    contract market or derivatives transaction execution facility as
    the Commission finds are necessary to diminish, eliminate, or
    prevent such burden. In determining whether any person has exceeded
    such limits, the positions held and trading done by any persons
    directly or indirectly controlled by such person shall be included
    with the positions held and trading done by such person; and
    further, such limits upon positions and trading shall apply to
    positions held by, and trading done by, two or more persons acting
    pursuant to an expressed or implied agreement or understanding, the
    same as if the positions were held by, or the trading were done by,
    a single person. Nothing in this section shall be construed to
    prohibit the Commission from fixing different trading or position
    limits for different commodities, markets, futures, or delivery
    months, or for different number of days remaining until the last
    day of trading in a contract, or different trading limits for
    buying and selling operations, or different limits for the purposes
    of paragraphs (1) and (2) of subsection (b) of this section, or
    from exempting transactions normally known to the trade as
    "spreads" or "straddles" or "arbitrage" or from fixing limits
    applying to such transactions or positions different from limits
    fixed for other transactions or positions. The word "arbitrage" in
    domestic markets shall be defined to mean the same as "spread" or
    "straddle". The Commission is authorized to define the term
    "international arbitrage".
    (b) Prohibition on trading or positions in excess of limits fixed
      by Commission
      The Commission shall, in such rule, regulation, or order, fix a
    reasonable time (not to exceed ten days) after the promulgation of
    the rule, regulation, or order; after which, and until such rule,
    regulation, or order is suspended, modified, or revoked, it shall
    be unlawful for any person - 
        (1) directly or indirectly to buy or sell, or agree to buy or
      sell, under contracts of sale of such commodity for future
      delivery on or subject to the rules of the contract market or
      markets, or derivatives transaction execution facility or
      facilities, to which the rule, regulation, or order applies, any
      amount of such commodity during any one business day in excess of
      any trading limit fixed for one business day by the Commission in
      such rule, regulation, or order for or with respect to such
      commodity; or
        (2) directly or indirectly to hold or control a net long or a
      net short position in any commodity for future delivery on or
      subject to the rules of any contract market or derivatives
      transaction execution facility in excess of any position limit
      fixed by the Commission for or with respect to such commodity:
      Provided, That such position limit shall not apply to a position
      acquired in good faith prior to the effective date of such rule,
      regulation, or order.
    (c) Applicability to bona fide hedging transactions or positions
      No rule, regulation, or order issued under subsection (a) of this
    section shall apply to transactions or positions which are shown to
    be bona fide hedging transactions or positions as such terms shall
    be defined by the Commission by rule, regulation, or order
    consistent with the purposes of this chapter. Such terms may be
    defined to permit producers, purchasers, sellers, middlemen, and
    users of a commodity or a product derived therefrom to hedge their
    legitimate anticipated business needs for that period of time into
    the future for which an appropriate futures contract is open and
    available on an exchange. To determine the adequacy of this chapter
    and the powers of the Commission acting thereunder to prevent
    unwarranted price pressures by large hedgers, the Commission shall
    monitor and analyze the trading activities of the largest hedgers,
    as determined by the Commission, operating in the cattle, hog, or
    pork belly markets and shall report its findings and
    recommendations to the Senate Committee on Agriculture, Nutrition,
    and Forestry and the House Committee on Agriculture in its annual
    reports for at least two years following January 11, 1983.
    (d) Persons subject to regulation; applicability to transactions
      made by or on behalf of United States
      This section shall apply to a person that is registered as a
    futures commission merchant, an introducing broker, or a floor
    broker under authority of this chapter only to the extent that
    transactions made by such person are made on behalf of or for the
    account or benefit of such person. This section shall not apply to
    transactions made by, or on behalf of, or at the direction of, the
    United States, or a duly authorized agency thereof.
    (e) Rulemaking power and penalties for violation
      Nothing in this section shall prohibit or impair the adoption by
    any contract market, derivatives transaction execution facility, or
    by any other board of trade licensed, designated, or registered by
    the Commission of any bylaw, rule, regulation, or resolution fixing
    limits on the amount of trading which may be done or positions
    which may be held by any person under contracts of sale of any
    commodity for future delivery traded on or subject to the rules of
    such contract market or derivatives transaction execution facility,
    or under options on such contracts or commodities traded on or
    subject to the rules of such contract market, derivatives
    transaction execution facility, or such board of trade: Provided,
    That if the Commission shall have fixed limits under this section
    for any contract or under section 6c of this title for any
    commodity option, then the limits fixed by the bylaws, rules,
    regulations, and resolutions adopted by such contract market,
    derivatives transaction execution facility, or such board of trade
    shall not be higher than the limits fixed by the Commission. It
    shall be a violation of this chapter for any person to violate any
    bylaw, rule, regulation, or resolution of any contract market,
    derivatives transaction execution facility, or other board of trade
    licensed, designated, or registered by the Commission fixing limits
    on the amount of trading which may be done or positions which may
    be held by any person under contracts of sale of any commodity for
    future delivery or under options on such contracts or commodities,
    if such bylaw, rule, regulation, or resolution has been approved by
    the Commission: Provided, That the provisions of section 13(c) (!1)
    of this title shall apply only to those who knowingly violate such
    limits.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4a, as added June 15, 1936, ch. 545,
    Sec. 5, 49 Stat. 1492; amended July 24, 1956, ch. 690, Sec. 1, 70
    Stat. 630; Pub. L. 90-258, Secs. 2-4, Feb. 19, 1968, 82 Stat. 26,
    27; Pub. L. 93-463, title IV, Secs. 403, 404, Oct. 23, 1974, 88
    Stat. 1413; Pub. L. 94-16, Sec. 4, Apr. 16, 1975, 89 Stat. 78; Pub.
    L. 97-444, title II, Sec. 205, Jan. 11, 1983, 96 Stat. 2299; Pub.
    L. 102-546, title IV, Sec. 402(1)(A), (2), Oct. 28, 1992, 106 Stat.
    3624; Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(4)], Dec.
    21, 2000, 114 Stat. 2763, 2763A-407.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      Section 13(c) of this title, referred to in subsec. (e), was
    struck out and subsec. (d) of section 13 was redesignated (c) by
    Pub. L. 102-546, title II, Sec. 212(a)(1)(A), (B), Oct. 28, 1992,
    106 Stat. 3608.

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (a). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(4)(A)], inserted "or derivatives transaction execution
    facilities" after "contract markets" in first sentence and "or
    derivatives transaction execution facility" after "contract market"
    in second sentence.
      Subsec. (b)(1). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(4)(B)(i)], inserted ", or derivatives transaction execution
    facility or facilities," after "markets".
      Subsec. (b)(2). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(4)(B)(ii)], inserted "or derivatives transaction execution
    facility" after "contract market".
      Subsec. (e). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(4)(C)], substituted "contract market, derivatives
    transaction execution facility, or" for "contract market or"
    wherever appearing, "licensed, designated, or registered" for
    "licensed or designated" in two places, and "contract market or
    derivatives transaction execution facility, or" for "contract
    market, or".
      1992 - Subsec. (a). Pub. L. 102-546, Sec. 402(1)(A), (2)(A), (C),
    redesignated par. (1) as subsec. (a), substituted "Commission" for
    "commission" wherever appearing except in last sentence, and
    substituted "paragraphs (1) and (2) of subsection (b) of this
    section" for "subparagraphs (A) and (B) of paragraph (2)".
      Subsec. (b). Pub. L. 102-546, Sec. 402(1)(A), (2)(C), (D),
    redesignated par. (2) as subsec. (b) and subpars. (A) and (B) as
    pars. (1) and (2), respectively, and substituted "Commission" for
    "commission" wherever appearing.
      Subsec. (c). Pub. L. 102-546, Sec. 402(2)(B), (C), redesignated
    par. (3) as subsec. (c) and substituted "subsection (a)" for
    "paragraph (1)".
      Subsecs. (d), (e). Pub. L. 102-546, Sec. 402(2)(C), redesignated
    pars. (4) and (5) as subsecs. (d) and (e), respectively.
      1983 - Par. (1). Pub. L. 97-444, Sec. 205(1), (2), substituted
    "by rule, regulation, or order, proclaim" for "by order, proclaim"
    and inserted "or for different number of days remaining until the
    last day of trading in a contract," after "delivery months".
      Par. (2). Pub. L. 97-444, Sec. 205(1), (3), substituted "after
    the promulgation of the rule, regulation, or order" for "after the
    order's promulgation" in provisions before subpar. (A) and
    substituted "rule, regulation, or order" for "order" in provisions
    before subpar. (A) and in subpars. (A) and (B).
      Par. (3). Pub. L. 97-444, Sec. 205(4), substituted "No rule,
    regulation, or order issued under paragraph (1) of this section
    shall apply to transactions or positions which are shown to be bona
    fide hedging transactions or positions as such terms shall be
    defined by the Commission by rule, regulation, or order consistent
    with the purposes of this chapter" for "No order issued under
    paragraph (1) of this section shall apply to transactions or
    positions which are shown to be bona fide hedging transactions or
    positions as such terms shall be defined by the Commission within
    one hundred and eighty days after the effective date of the
    Commodity Futures Trading Commission Act of 1974 by order
    consistent with the purposes of this chapter" and inserted "Such
    terms may be defined to permit producers, purchasers, sellers,
    middlemen, and users of a commodity or a product derived therefrom
    to hedge their legitimate anticipated business needs for that
    period of time into the future for which an appropriate futures
    contract is open and available on an exchange. To determine the
    adequacy of this chapter and the powers of the Commission acting
    thereunder to prevent unwarranted price pressures by large hedgers,
    the Commission shall monitor and analyze the trading activities of
    the largest hedgers, as determined by the Commission, operating in
    the cattle, hog, or pork belly markets and shall report its
    findings and recommendations to the Senate Committee on
    Agriculture, Nutrition, and Forestry and the House Committee on
    Agriculture in its annual reports for at least two years following
    January 11, 1983."
      Par. (4). Pub. L. 97-444, Sec. 205(5), substituted "a futures
    commission merchant, an introducing broker, or a floor broker" for
    "a futures commission merchant or as floor broker".
      Par. (5). Pub. L. 97-444, Sec. 205(6), added par. (5).
      1975 - Par. (3). Pub. L. 94-16 substituted "one hundred and
    eighty days" for "ninety days".
      1974 - Par. (1). Pub. L. 93-463, Sec. 403, inserted "or
    'arbitrage' " after "or 'straddles' ", inserted definition of
    "arbitrage", and authorized Commission to define "international
    arbitrage".
      Par. (3). Pub. L. 93-463, Sec. 404, directed Commission to define
    "bona fide hedging transactions or positions" within 90 days after
    the effective date of the Commodity Futures Trading Commission Act
    of 1974 and struck out provisions which enumerated the factors to
    be taken into account in determining whether a hedging transaction
    or position was a bona fide transaction or position.
      1968 - Par. (1). Pub. L. 90-258, Sec. 2, substituted in second
    sentence "amounts of trading" for "amount of trading", inserted
    "which may be done or positions which may be held by any person"
    before "under contracts of sale", and struck out "which may be
    done" after "rules of any contract market", inserted third sentence
    providing for inclusion of controlled positions and trading in
    determining whether prescribed position or trading limits have been
    exceeded and for application of such position and trading limits to
    activities of two or more persons acting pursuant to agreement or
    understanding as if the activities of a single person, and included
    in fourth, formerly third, sentence references to position limits
    and to positions, substituted "normally" for "commonly", and struck
    out "trading" from "from fixing trading limits" and "from trading
    limits".
      Par. (2)(B). Pub. L. 90-258, Sec. 3, substituted prohibition
    against holding of net long or net short positions in excess of any
    position limit fixed by the Commission for former prohibition of
    purchases or sales which result in net long or net short positions
    in excess of trading limits fixed by the Commission and provided
    that the position limit shall not apply to a position acquired in
    good faith prior to the effective date of the order.
      Par. (3). Pub. L. 90-258, Sec. 4, included references to
    positions, made hedging applicable to short and long positions,
    substituted "contract market" for "board of trade", and required
    the activities to be those of the same person to constitute
    hedging.
      1956 - Par. (3)(C). Act July 24, 1956, added subpar. (C).

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      Section 404 of Pub. L. 93-463 provided that the amendment of par.
    (3) which struck out provisions that enumerated the factors to be
    taken into account in determining whether a hedging transaction or
    position was a bona fide transaction or position, was effective
    immediately upon the enactment of Pub. L. 93-463, which was
    approved Oct. 23, 1974.
      Amendment by Pub. L. 93-463 of par. (1) and that part of par. (3)
    directing the Commission to define "bona fide hedging transactions
    or positions" effective so as to allow implementation of all
    changes effected by this amendment to be carried out after Oct. 23,
    1974, and before as well as after the 180th day thereafter, see
    section 418 of Pub. L. 93-463, set out as a note under section 2 of
    this title.

                     EFFECTIVE DATE OF 1968 AMENDMENT                 
      Amendment by Pub. L. 90-258 effective 120 days after Feb. 19,
    1968, see section 28 of Pub. L. 90-258, set out as a note under
    section 2 of this title.

                     EFFECTIVE DATE OF 1956 AMENDMENT                 
      Section 2 of act July 24, 1956, provided that: "This Act
    [amending this section] shall take effect sixty days after the date
    of its enactment [July 24, 1956]."

                              EFFECTIVE DATE                          
      For effective date of section, see section 13 of act June 15,
    1936, set out as an Effective Date of 1936 Amendment note under
    section 1 of this title.

     REGULATIONS DEFINING BONA FIDE HEDGING TRANSACTIONS AND POSITIONS 
      Section 404 of Pub. L. 93-463 provided in part: "That
    notwithstanding any other provision of law, the Secretary of
    Agriculture, immediately upon the enactment of the Commodity
    Futures Trading Commission Act of 1974 [which was approved on Oct.
    23, 1974], is authorized and directed to promulgate regulations
    defining bona fide hedging transactions and positions: And provided
    further, That until the Secretary issues such regulations defining
    bona fide hedging transactions and positions and such regulations
    are in full force and effect, such terms shall continue to be
    defined as set forth in the Commodity Exchange Act [par. (3) of
    this section] prior to its amendment by the Commodity Futures
    Trading Commission Act of 1974 [Pub. L. 93-463]."

-FOOTNOTE-
    (!1) See References in Text note below.

-End-

-CITE-
    7 USC Sec. 6b                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6b. Fraud, false reporting, or deception prohibited

-STATUTE-
    (a) Contracts designed to defraud or mislead; bucketing orders
      It shall be unlawful (1) for any member of a registered entity,
    or for any correspondent, agent, or employee of any member, in or
    in connection with any order to make, or the making of, any
    contract of sale of any commodity in interstate commerce, made, or
    to be made, on or subject to the rules of any registered entity,
    for or on behalf of any other person, or (2) for any person, in or
    in connection with any order to make, or the making of, any
    contract of sale of any commodity for future delivery made, or to
    be made, for or on behalf of any other person if such contract for
    future delivery is or may be used for (A) hedging any transaction
    in interstate commerce in such commodity or the products or
    byproducts thereof, or (B) determining the price basis of any
    transaction in interstate commerce in such commodity, or (C)
    delivering any such commodity sold, shipped, or received in
    interstate commerce for the fulfillment thereof - 
        (i) to cheat or defraud or attempt to cheat or defraud such
      other person;
        (ii) willfully to make or cause to be made to such other person
      any false report or statement thereof, or willfully to enter or
      cause to be entered for such person any false record thereof;
        (iii) willfully to deceive or attempt to deceive such other
      person by any means whatsoever in regard to any such order or
      contract or the disposition or execution of any such order or
      contract, or in regard to any act of agency performed with
      respect to such order or contract for such person; or
        (iv) to bucket such order, or to fill such order by offset
      against the order or orders of any other person, or willfully and
      knowingly and without the prior consent of such person to become
      the buyer in respect to any selling order of such person, or
      become the seller in respect to any buying order of such person.
    (b) Buying and selling orders for commodity
      Nothing in this section or in any other section of this chapter
    shall be construed to prevent a futures commission merchant or
    floor broker who shall have in hand, simultaneously, buying and
    selling orders at the market for different principals for a like
    quantity of a commodity for future delivery in the same month
    executing such buying and selling orders at the market price:
    Provided, That any such execution shall take place on the floor of
    the exchange where such orders are to be executed at public outcry
    across the ring and shall be duly reported, recorded, and cleared
    in the same manner as other orders executed on such exchange: And
    provided further, That such transactions shall be made in
    accordance with such rules and regulations as the Commission may
    promulgate regarding the manner of the execution of such
    transactions.
    (c) Inapplicability to transactions on foreign exchanges
      Nothing in this section shall apply to any activity that occurs
    on a board of trade, exchange, or market, or clearinghouse for such
    board of trade, exchange, or market, located outside the United
    States, or territories or possessions of the United States,
    involving any contract of sale of a commodity for future delivery
    that is made, or to be made, on or subject to the rules of such
    board of trade, exchange, or market.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4b, as added June 15, 1936, ch. 545,
    Sec. 5, 49 Stat. 1493; amended Pub. L. 90-258, Sec. 5, Feb. 19,
    1968, 82 Stat. 27; Pub. L. 93-463, title IV, Sec. 405, Oct. 23,
    1974, 88 Stat. 1413; Pub. L. 99-641, title I, Sec. 101, Nov. 10,
    1986, 100 Stat. 3557; Pub. L. 102-546, title IV, Sec. 402(3), Oct.
    28, 1992, 106 Stat. 3624; Pub. L. 106-554, Sec. 1(a)(5) [title I,
    Sec. 123(a)(5)], Dec. 21, 2000, 114 Stat. 2763, 2763A-407.)

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (a)(1). Pub. L. 106-554 substituted "registered
    entity" for "contract market" in two places.
      1992 - Pub. L. 102-546 designated first par. as subsec. (a),
    redesignated cls. (a) to (c) as subpars. (A) to (C), respectively,
    and subpars. (A) to (D) as cls. (i) to (iv), respectively, and
    designated second and third undesignated pars. as subsecs. (b) and
    (c), respectively.
      1986 - Pub. L. 99-641 struck out "on or subject to the rules of
    any contract market," after "to be made" in cl. (2) of first par.
    and added concluding paragraph that this section not apply to
    activity on board of trade, exchange, market, or clearinghouse
    located outside United States involving contract of sale of
    commodity for future delivery.
      1974 - Pub. L. 93-463 substituted "a commodity" for "cotton" in
    provisions following subpar. (D) and inserted requirement that
    execution of buying and selling orders for commodities held
    simultaneously by the same merchant or broker be carried out in
    accordance with such rules and regulations as the Commission may
    promulgate regarding the manner of the execution of such
    transactions.
      1968 - Pub. L. 90-258 relocated cl. (1) designation in first par.
    to follow "unlawful" rather than to precede "any contract of sale",
    provided in such cl. (1) for orders to make or making of contracts
    of sale "made, or to be made on or subject to the rules of any
    contract market, for or on behalf of any other person" and in cl.
    (2) "for any person, in or in connection with any order to make, or
    the making of," any contract of sale of any commodity for future
    delivery for or on behalf of any "other" person; and inserted
    "other" before "person" in subpar. (A) and in subpars. (B) and (C)
    where appearing for first time, respectively.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1968 AMENDMENT                 
      Amendment by Pub. L. 90-258 effective 120 days after Feb. 19,
    1968, see section 28 of Pub. L. 90-258, set out as a note under
    section 2 of this title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 13 of act June 15,
    1936, set out as an Effective Date of 1936 Amendment note under
    section 1 of this title.

-End-

-CITE-
    7 USC Sec. 6c                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6c. Prohibited transactions

-STATUTE-
    (a) In general
      (1) Prohibition
        It shall be unlawful for any person to offer to enter into,
      enter into, or confirm the execution of a transaction described
      in paragraph (2) involving the purchase or sale of any commodity
      for future delivery (or any option on such a transaction or
      option on a commodity) if the transaction is used or may be used
      to - 
          (A) hedge any transaction in interstate commerce in the
        commodity or the product or byproduct of the commodity;
          (B) determine the price basis of any such transaction in
        interstate commerce in the commodity; or
          (C) deliver any such commodity sold, shipped, or received in
        interstate commerce for the execution of the transaction.
      (2) Transaction
        A transaction referred to in paragraph (1) is a transaction
      that - 
          (A)(i) is, of the character of, or is commonly known to the
        trade as, a "wash sale" or "accommodation trade"; or
          (ii) is a fictitious sale; or
          (B) is used to cause any price to be reported, registered, or
        recorded that is not a true and bona fide price.
    (b) Regulated option trading
      No person shall offer to enter into, enter into or confirm the
    execution of, any transaction involving any commodity regulated
    under this chapter which is of the character of, or is commonly
    known to the trade as, an "option", "privilege", "indemnity",
    "bid", "offer", "put", "call", "advance guaranty", or "decline
    guaranty", contrary to any rule, regulation, or order of the
    Commission prohibiting any such transaction or allowing any such
    transaction under such terms and conditions as the Commission shall
    prescribe. Any such order, rule, or regulation may be made only
    after notice and opportunity for hearing, and the Commission may
    set different terms and conditions for different markets.
    (c) Regulations for elimination of pilot status of commodity option
      transactions; terms and conditions of options trading
      Not later than 90 days after November 10, 1986, the Commission
    shall issue regulations - 
        (1) to eliminate the pilot status of its program for commodity
      option transactions involving the trading of options on contract
      markets, including any numerical restrictions on the number of
      commodities or option contracts for which a contract market may
      be designated; and
        (2) otherwise to continue to permit the trading of such
      commodity options under such terms and conditions that the
      Commission from time to time may prescribe.
    (d) Dealer options exempt from subsections (b) and (c)
      prohibitions; requirements
      Notwithstanding the provisions of subsection (c) of this section -
     
        (1) any person domiciled in the United States who on May 1,
      1978, was in the business of granting an option on a physical
      commodity, other than a commodity specifically set forth in
      section 2(a) of this title prior to October 23, 1974, and was in
      the business of buying, selling, producing, or otherwise using
      that commodity, may continue to grant or issue options on that
      commodity in accordance with Commission regulations in effect on
      August 17, 1978, until thirty days after the effective date of
      regulations issued by the Commission under clause (2) of this
      subsection: Provided, That if such person files an application
      for registration under the regulations issued under clause (2) of
      this subsection within thirty days after the effective date of
      such regulations, that person may continue to grant or issue
      options pending a final determination by the Commission on the
      application; and
        (2) the Commission shall issue regulations that permit grantors
      and futures commission merchants to offer to enter into, enter
      into, or confirm the execution of, any commodity option
      transaction on a physical commodity subject to the provisions of
      subsection (b) of this section, other than a commodity
      specifically set forth in section 2(a) of this title prior to
      October 23, 1974, if - 
          (A) the grantor is a person domiciled in the United States
        who - 
            (i) is in the business of buying, selling, producing, or
          otherwise using the underlying commodity;
            (ii) at all times has a net worth of at least $5,000,000
          certified annually by an independent public accountant using
          generally accepted accounting principles;
            (iii) notifies the Commission and every futures commission
          merchant offering the grantor's option if the grantor knows
          or has reason to believe that the grantor's net worth has
          fallen below $5,000,000;
            (iv) segregates daily, exclusively for the benefit of
          purchasers, money, exempted securities (within the meaning of
          section 78c(a)(12) of title 15), commercial paper, bankers'
          acceptances, commercial bills, or unencumbered warehouse
          receipts, equal to an amount by which the value of each
          transaction exceeds the amount received or to be received by
          the grantor for such transaction;
            (v) provides an identification number for each transaction;
          and
            (vi) provides confirmation of all orders for such
          transactions executed, including the execution price and a
          transaction identification number;

          (B) the futures commission merchant is a person who - 
            (i) has evidence that the grantor meets the requirements
          specified in subclause (A) of this clause;
            (ii) treats and deals with all money, securities, or
          property received from its customers as payment of the
          purchase price in connection with such transactions, as
          belonging to such customers until the expiration of the term
          of the option, or, if the customer exercises the option,
          until all rights of the customer under the commodity option
          transaction have been fulfilled;
            (iii) records each transaction in its customer's name by
          the transaction identification number provided by the
          grantor;
            (iv) provides a disclosure statement to its customers,
          under regulations of the Commission, that discloses, among
          other things, all costs, including any markups or commissions
          involved in such transaction; and

          (C) the grantor and futures commission merchant comply with
        any additional uniform and reasonable terms and conditions the
        Commission may prescribe, including registration with the
        Commission.

    The Commission may permit persons not domiciled in the United
    States to grant options under this subsection, other than options
    on a commodity specifically set forth in section 2(a) of this title
    prior to October 23, 1974, under such additional rules,
    regulations, and orders as the Commission may adopt to provide
    protection to purchasers that are substantially the equivalent of
    those applicable to grantors domiciled in the United States. The
    Commission may terminate the right of any person to grant, offer,
    or sell options under this subsection only after a hearing,
    including a finding that the continuation of such right is contrary
    to the public interest: Provided, That pending the completion of
    such termination proceedings, the Commission may suspend the right
    to grant, offer, or sell options of any person whose activities in
    the Commission's judgment present a substantial risk to the public
    interest.
    (e) Rules and regulations
      The Commission may adopt rules and regulations, after public
    notice and opportunity for a hearing on the record, prohibiting the
    granting, issuance, or sale of options permitted under subsection
    (d) of this section if the Commission determines that such options
    are contrary to the public interest.
    (f) Nonapplicability to foreign currency options
      Nothing in this chapter shall be deemed to govern or in any way
    be applicable to any transaction in an option on foreign currency
    traded on a national securities exchange.
    (g) Oral orders
      The Commission shall adopt rules requiring that a contemporaneous
    written record be made, as practicable, of all orders for execution
    on the floor or subject to the rules of each contract market or
    derivatives transaction execution facility placed by a member of
    the contract market or derivatives transaction execution facility
    who is present on the floor at the time such order is placed.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4c, as added June 15, 1936, ch. 545,
    Sec. 5, 49 Stat. 1494; amended Pub. L. 93-463, title I, Sec.
    103(a), title IV, Sec. 402, Oct. 23, 1974, 88 Stat. 1392, 1412;
    Pub. L. 95-405, Sec. 3, Sept. 30, 1978, 92 Stat. 867; Pub. L. 97-
    444, title I, Sec. 102, title II, Sec. 206, Jan. 11, 1983, 96
    Stat. 2296, 2301; Pub. L. 99-641, title I, Sec. 102, Nov. 10, 1986,
    100 Stat. 3557; Pub. L. 102-546, title II, Sec. 203(a), title IV,
    Sec. 402(4), Oct. 28, 1992, 106 Stat. 3600, 3624; Pub. L. 106-554,
    Sec. 1(a)(5) [title I, Secs. 109, 123(a)(6)], Dec. 21, 2000, 114
    Stat. 2763, 2763A-383, 2763A-407.)

-MISC1-
                                AMENDMENTS                            
      2000 - Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 109],
    inserted section catchline.
      Subsec. (a). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 109],
    added subsec. (a) and struck out former subsec. (a) which read as
    follows: "It shall be unlawful for any person to offer to enter
    into, enter into, or confirm the execution of, any transaction
    involving any commodity, which is or may be used for (1) hedging
    any transaction in interstate commerce in such commodity or the
    products or byproducts thereof, or (2) determining the price basis
    of any such transaction in interstate commerce in such commodity,
    or (3) delivering any such commodity sold, shipped, or received in
    interstate commerce for the fulfillment thereof - 
        "(A) if such transaction is, is of the character of, or is
      commonly known to the trade as, a 'wash sale,' 'cross trade,' or
      'accommodation trade,' or is a fictitious sale; or
        "(B) if such transaction is used to cause any price to be
      reported, registered, or recorded which is not a true and bona
      fide price.

    Nothing in this section shall be construed to prevent the exchange
    of futures in connection with cash commodity transactions or of
    futures for cash commodities, or of transfer trades or office
    trades if made in accordance with board of trade rules applying to
    such transactions and such rules shall have been approved by the
    Commission."
      Subsec. (g). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(6)], inserted "or derivatives transaction execution
    facility" after "contract market" in two places.
      1992 - Subsec. (d)(2). Pub. L. 102-546, Sec. 402(4), made
    technical amendments to references to section 78c(a)(12) of title
    15 in subpar. (A)(iv) and to section 2(a) of this title in
    concluding provisions.
      Subsec. (g). Pub. L. 102-546, Sec. 203(a), added subsec. (g).
      1986 - Subsec. (c). Pub. L. 99-641, amended subsec. (c)
    generally, substituting provisions relating to regulations to
    eliminate pilot status of program for commodity option transactions
    for provisions relating to commodity option transactions, pilot
    program and permanent authorization, conditions ending prohibition,
    and excepted persons.
      1983 - Subsec. (a)(B), (C). Pub. L. 97-444, Sec. 206(1),
    redesignated par. (C) as (B). Former par. (B), relating to
    transactions involving any commodity specifically set forth in
    section 2(a) of this title, prior to October 23, 1974, if such
    transactions were of the character of, or were commonly known to
    the trade as, an "option", "privilege", "indemnity", "bid",
    "offer", "put", "call", "advance guaranty", or "decline guaranty",
    was struck out.
      Subsec. (b). Pub. L. 97-444, Sec. 206(2), in revising section
    generally, struck out references to any transaction subject to
    provisions of subsection (a) of this section and to any commodity
    not specifically set forth in section 2(a) of this title, prior to
    October 23, 1974, and struck out "within one year after the
    effective date of the Commodity Futures Trading Commission Act of
    1974 unless the Commission determines and notifies the Senate
    Committee on Agriculture, Nutrition, and Forestry and the House
    Committee on Agriculture that it is unable to prescribe such terms
    and conditions within such period of time:" after "such terms and
    conditions as the Commission shall prescribe".
      Subsec. (c). Pub. L. 97-444, Sec. 206(3), inserted "With respect
    to any commodity regulated under this chapter and specifically set
    forth in section 2(a) of this title prior to October 23, 1974, the
    Commission may, pursuant to the procedures set forth in this
    subsection, establish a pilot program for a period not to exceed
    three years to permit such commodity option transactions. The
    Commission may authorize commodity option transactions during the
    pilot program in as many commodities as will provide an adequate
    test of the trading of such option transactions. After completion
    of the pilot program, the Commission may authorize commodity option
    transactions without regard to the restrictions in the pilot
    program after the Commission transmits to the House Committee on
    Agriculture and the Senate Committee on Agriculture, Nutrition, and
    Forestry the documentation required under clause (1) of the first
    sentence of this subsection and the expiration of thirty calendar
    days of continuous session of Congress after the date of such
    transmittal."
      Subsec. (d)(1). Pub. L. 97-444, Sec. 206(4)(A), inserted ", other
    than a commodity specifically set forth in section 2(a) of this
    title prior to October 23, 1974," after "physical commodity".
      Subsec. (d)(2). Pub. L. 97-444, Sec. 206(4)(B), inserted ", other
    than a commodity specifically set forth in section 2(a) of this
    title prior to October 23, 1974," after "subsection (b) of this
    section" in provisions preceding subpar. (A).
      Pub. L. 97-444, Sec. 206(4)(C), inserted ", other than options on
    a commodity specifically set forth in section 2(a) of this title
    prior to October 23, 1974," after "The Commission may permit
    persons not domiciled in the United States to grant options under
    this subsection" in provisions following par. (2).
      Subsec. (f). Pub. L. 97-444, Sec. 102, added subsec. (f).
      1978 - Subsec. (a). Pub. L. 95-405, Sec. 3(1), in provisions
    following par. (C) substituted "have been approved" for "not have
    been disapproved".
      Subsec. (b). Pub. L. 95-405, Sec. 3(2), substituted "Senate
    Committee on Agriculture, Nutrition, and Forestry" for "Senate
    Committee on Agriculture and Forestry".
      Subsecs. (c) to (e). Pub. L. 95-405, Sec. 3(3), added subsecs.
    (c) to (e).
      1974 - Subsec. (a). Pub. L. 93-463, Secs. 103(a), 402(a), (b),
    (d), designated existing provisions as subsec. (a), in par. (B) of
    subsec. (a) as so designated inserted "if such transaction involves
    any commodity specifically set forth in section 2(a) of this title,
    prior to the enactment of the Commodity Futures Trading Commission
    Act of 1974, and" and "option", and in provisions following par.
    (C), struck out provisions prohibiting a construction of this
    section or section 6b of this title which would impair any State
    law applicable to any transaction enumerated or described in this
    section or section 6b of this title and substituted "Commission"
    for "Secretary of Agriculture".
      Subsec. (b). Pub. L. 93-463, Sec. 402(c), added subsec. (b).

                     EFFECTIVE DATE OF 1992 AMENDMENT                 
      Section 203(b) of Pub. L. 102-546 provided that: "The Commission
    shall adopt the rules required by the amendment made under
    subsection (a) [amending this section] within two hundred and
    seventy days after the date of enactment of this Act [Oct. 28,
    1992]."

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 13 of act June 15,
    1936, set out as an Effective Date of 1936 Amendment note under
    section 1 of this title.

-End-

-CITE-
    7 USC Sec. 6d                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6d. Dealing by unregistered futures commission merchants or
      introducing brokers prohibited; duties in handling customer
      receipts; rules to avoid duplicative regulations

-STATUTE-
    (a) Registration requirements; duties of merchants in handling
      customer receipts
      It shall be unlawful for any person to engage as futures
    commission merchant or introducing broker in soliciting orders or
    accepting orders for the purchase or sale of any commodity for
    future delivery, or involving any contracts of sale of any
    commodity for future delivery, on or subject to the rules of any
    contract market or derivatives transaction execution facility
    unless - 
        (1) such person shall have registered, under this chapter, with
      the Commission as such futures commission merchant or introducing
      broker and such registration shall not have expired nor been
      suspended nor revoked; and
        (2) such person shall, if a futures commission merchant,
      whether a member or nonmember of a contract market or derivatives
      transaction execution facility, treat and deal with all money,
      securities, and property received by such person to margin,
      guarantee, or secure the trades or contracts of any customer of
      such person, or accruing to such customer as the result of such
      trades or contracts, as belonging to such customer. Such money,
      securities, and property shall be separately accounted for and
      shall not be commingled with the funds of such commission
      merchant or be used to margin or guarantee the trades or
      contracts, or to secure or extend the credit, of any customer or
      person other than the one for whom the same are held: Provided,
      however, That such money, securities, and property of the
      customers of such futures commission merchant may, for
      convenience, be commingled and deposited in the same account or
      accounts with any bank or trust company or with the clearing
      house organization of such contract market or derivatives
      transaction execution facility, and that such share thereof as in
      the normal course of business shall be necessary to margin,
      guarantee, secure, transfer, adjust, or settle the contracts or
      trades of such customers, or resulting market positions, with the
      clearinghouse organization of such contract market or derivatives
      transaction execution facility or with any member of such
      contract market or derivatives transaction execution facility,
      may be withdrawn and applied to such purposes, including the
      payment of commissions, brokerage, interest, taxes, storage, and
      other charges, lawfully accruing in connection with such
      contracts and trades: Provided further, That in accordance with
      such terms and conditions as the Commission may prescribe by
      rule, regulation, or order, such money, securities, and property
      of the customers of such futures commission merchant may be
      commingled and deposited as provided in this section with any
      other money, securities, and property received by such futures
      commission merchant and required by the Commission to be
      separately accounted for and treated and dealt with as belonging
      to the customers of such futures commission merchant: Provided
      further, That such money may be invested in obligations of the
      United States, in general obligations of any State or of any
      political subdivision thereof, and in obligations fully
      guaranteed as to principal and interest by the United States,
      such investments to be made in accordance with such rules and
      regulations and subject to such conditions as the Commission may
      prescribe.
    (b) Duties of clearing agencies, depositories, and others in
      handling customer receipts
      It shall be unlawful for any person, including but not limited to
    any clearing agency of a contract market or derivatives transaction
    execution facility and any depository, that has received any money,
    securities, or property for deposit in a separate account as
    provided in paragraph (2) of this section,(!1) to hold, dispose of,
    or use any such money, securities, or property as belonging to the
    depositing futures commission merchant or any person other than the
    customers of such futures commission merchant.

    (c) Rules to avoid duplicative regulation of dual registrants
      Consistent with this chapter, the Commission, in consultation
    with the Securities and Exchange Commission, shall issue such
    rules, regulations, or orders as are necessary to avoid duplicative
    or conflicting regulations applicable to any futures commission
    merchant registered with the Commission pursuant to section 6f(a)
    of this title (except paragraph (2) thereof), that is also
    registered with the Securities and Exchange Commission pursuant to
    section 78o(b) of title 15 (except paragraph (11) thereof),
    involving the application of - 
        (1) section 78h, section 78o(c)(3), and section 78q of title 15
      and the rules and regulations thereunder related to the treatment
      of customer funds, securities, or property, maintenance of books
      and records, financial reporting or other financial
      responsibility rules (as defined in section 78c(a)(40) of title
      15), involving security futures products; and
        (2) similar provisions of this chapter and the rules and
      regulations thereunder involving security futures products.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4d, as added June 15, 1936, ch. 545,
    Sec. 5, 49 Stat. 1494; amended Pub. L. 90-258, Sec. 6, Feb. 19,
    1968, 82 Stat. 27; Pub. L. 93-463, title I, Sec. 103(a), Oct. 23,
    1974, 88 Stat. 1392; Pub. L. 95-405, Sec. 4, Sept. 30, 1978, 92
    Stat. 869; Pub. L. 97-444, title II, Sec. 207, Jan. 11, 1983, 96
    Stat. 2302; Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(6),
    title II, Sec. 251(f)], Dec. 21, 2000, 114 Stat. 2763, 2763A-407,
    2763A-443.)

-MISC1-
                                AMENDMENTS                            
      2000 - Pub. L. 106-554, Sec. 1(a)(5) [title II, Sec. 251(f)],
    designated first undesignated par. as subsec. (a), designated
    second undesignated par. as subsec. (b), and added subsec. (c).
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(6)], inserted
    "or derivatives transaction execution facility" after "contract
    market" wherever appearing.
      1983 - Pub. L. 97-444, Sec. 207(1), inserted reference to
    introducing brokers in provisions preceding par. (1).
      Par. (1). Pub. L. 97-444, Sec. 207(2), inserted "or introducing
    broker" after "futures commission merchant".
      Par. (2). Pub. L. 97-444, Sec. 207(3), inserted "if a futures
    commission merchant," after "such person shall,".
      1978 - Pub. L. 95-405 in par. (2) inserted provisions authorizing
    Commission to prescribe terms and conditions under which funds and
    property commingled and deposited as permitted by par. (2) may be
    commingled and deposited with other funds and property received by
    a futures commission merchant and required by Commission to be
    separately accounted for and treated as belonging to its customers.
      1974 - Pub. L. 93-463 substituted "Commission" for "Secretary of
    Agriculture" in pars. (1) and (2).
      1968 - Pub. L. 90-258 struck out from second proviso of first
    par. authorization for investment of customer funds in investment
    securities of the kind national banking associations may buy or in
    loans secured by negotiable warehouse receipts conveying or
    securing title to readily marketable commodities to the extent of
    the current loan value of such receipts and added second par.,
    making it unlawful for any person, including a clearing agency of a
    contract market or any depository, to treat customer funds as
    belonging to any person other than the customer, respectively.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective 120 days after Jan. 11,
    1983, or such earlier date as the Commission shall prescribe by
    regulation, see section 239 of Pub. L. 97-444, set out as a note
    under section 2 of this title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1968 AMENDMENT                 
      Amendment by Pub. L. 90-258 effective 120 days after Feb. 19,
    1968, see section 28 of Pub. L. 90-258, set out as a note under
    section 2 of this title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 13 of act June 15,
    1936, set out as an Effective Date of 1936 Amendment note under
    section 1 of this title.

-FOOTNOTE-
    (!1) So in original. Probably means subsection (a)(2) of this
         section.

-End-

-CITE-
    7 USC Sec. 6e                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6e. Dealings by unregistered floor trader or broker prohibited

-STATUTE-
      It shall be unlawful for any person to act as floor trader in
    executing purchases and sales, or as floor broker in executing any
    orders for the purchase or sale, of any commodity for future
    delivery, or involving any contracts of sale of any commodity for
    future delivery, on or subject to the rules of any contract market
    or derivatives transaction execution facility unless such person
    shall have registered, under this chapter, with the Commission as
    such floor trader or floor broker and such registration shall not
    have expired nor been suspended nor revoked.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4e, as added June 15, 1936, ch. 545,
    Sec. 5, 49 Stat. 1495; amended Pub. L. 93-463, title I, Sec.
    103(a), Oct. 23, 1974, 88 Stat. 1392; Pub. L. 102-546, title II,
    Sec. 207(a), Oct. 28, 1992, 106 Stat. 3604; Pub. L. 106-554, Sec.
    1(a)(5) [title I, Sec. 123(a)(6)], Dec. 21, 2000, 114 Stat. 2763,
    2763A-407.)

-MISC1-
                                AMENDMENTS                            
      2000 - Pub. L. 106-554 inserted "or derivatives transaction
    execution facility" after "contract market".
      1992 - Pub. L. 102-546 amended section generally. Prior to
    amendment, section read as follows: "It shall be unlawful for any
    person to act as floor broker in executing any orders for the
    purchase or sale of any commodity for future delivery, or involving
    any contracts of sale of any commodity for future delivery, on or
    subject to the rules of any contract market unless such person
    shall have registered, under this chapter, with the Commission as
    such floor broker and such registration shall not have expired nor
    been suspended nor revoked."
      1974 - Pub. L. 93-463 substituted "Commission" for "Secretary of
    Agriculture".

                     EFFECTIVE DATE OF 1992 AMENDMENT                 
      Section 207(c) of Pub. L. 102-546 provided that: "The amendments
    made by this section [amending this section and sections 6f, 6g,
    12a, and 13a-2 of this title] shall become effective one hundred
    and eighty days after the date of enactment of this Act [Oct. 28,
    1992], and the Commodity Futures Trading Commission shall issue any
    regulations necessary to implement the amendments made by this
    section no later than one hundred and eighty days after the date of
    enactment of this Act."

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 13 of act June 15,
    1936, set out as an Effective Date of 1936 Amendment note under
    section 1 of this title.

-End-

-CITE-
    7 USC Sec. 6f                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6f. Registration and financial requirements; risk assessment

-STATUTE-
    (a) Registration of futures commission merchants, introducing
      brokers, and floor brokers and traders
      (1) Any person desiring to register as a futures commission
    merchant, introducing broker, floor broker, or floor trader
    hereunder shall be registered upon application to the Commission.
    The application shall be made in such form and manner as prescribed
    by the Commission, giving such information and facts as the
    Commission may deem necessary concerning the business in which the
    applicant is or will be engaged, including in the case of an
    application of a futures commission merchant or an introducing
    broker, the names and addresses of the managers of all branch
    offices, and the names of such officers and partners, if a
    partnership, and of such officers, directors, and stockholders, if
    a corporation, as the Commission may direct. Such person, when
    registered hereunder, shall likewise continue to report and furnish
    to the Commission the above-mentioned information and such other
    information pertaining to such person's business as the Commission
    may require. Each registration shall expire on December 31 of the
    year for which issued or at such other time, not less than one year
    from the date of issuance, as the Commission may by rule,
    regulation, or order prescribe, and shall be renewed upon
    application therefor unless the registration has been suspended
    (and the period of such suspension has not expired) or revoked
    pursuant to the provisions of this chapter.
      (2) Notwithstanding paragraph (1), and except as provided in
    paragraph (3), any broker or dealer that is registered with the
    Securities and Exchange Commission shall be registered as a futures
    commission merchant or introducing broker, as applicable, if - 
        (A) the broker or dealer limits its solicitation of orders,
      acceptance of orders, or execution of orders, or placing of
      orders on behalf of others involving any contracts of sale of any
      commodity for future delivery, on or subject to the rules of any
      contract market or registered derivatives transaction execution
      facility to security futures products;
        (B) the broker or dealer files written notice with the
      Commission in such form as the Commission, by rule, may prescribe
      containing such information as the Commission, by rule, may
      prescribe as necessary or appropriate in the public interest or
      for the protection of investors;
        (C) the registration of the broker or dealer is not suspended
      pursuant to an order of the Securities and Exchange Commission;
      and
        (D) the broker or dealer is a member of a national securities
      association registered pursuant to section 78o-3(a) of title 15.

    The registration shall be effective contemporaneously with the
    submission of notice, in written or electronic form, to the
    Commission.
      (3) A floor broker or floor trader shall be exempt from the
    registration requirements of section 6e of this title and paragraph
    (1) of this subsection if - 
        (A) the floor broker or floor trader is a broker or dealer
      registered with the Securities and Exchange Commission;
        (B) the floor broker or floor trader limits its solicitation of
      orders, acceptance of orders, or execution of orders, or placing
      of orders on behalf of others involving any contracts of sale of
      any commodity for future delivery, on or subject to the rules of
      any contract market to security futures products; and
        (C) the registration of the floor broker or floor trader is not
      suspended pursuant to an order of the Securities and Exchange
      Commission.

      (4)(A) A broker or dealer that is registered as a futures
    commission merchant or introducing broker pursuant to paragraph
    (2), or that is a floor broker or floor trader exempt from
    registration pursuant to paragraph (3), shall be exempt from the
    following provisions of this chapter and the rules thereunder:
        (i) Subsections (b), (d), (e), and (g) of section 6c of this
      title.
        (ii) Sections 6d, 6e, and 6h of this title.
        (iii) Subsections (b) and (c) of this section.
        (iv) Section 6j of this title.
        (v) Section 6k(1) of this title.
        (vi) Section 6p (!1) of this title.

        (vii) Section 13a-2 of this title.
        (viii) Subsections (d) and (g) of section 12 of this title.
        (ix) Section 20 of this title.

      (B)(i) Except as provided in clause (ii) of this subparagraph,
    but notwithstanding any other provision of this chapter, the
    Commission, by rule, regulation, or order, may conditionally or
    unconditionally exempt any broker or dealer subject to the
    registration requirement of paragraph (2), or any broker or dealer
    exempt from registration pursuant to paragraph (3), from any
    provision of this chapter or of any rule or regulation thereunder,
    to the extent the exemption is necessary or appropriate in the
    public interest and is consistent with the protection of investors.
      (ii) The Commission shall, by rule or regulation, determine the
    procedures under which an exemptive order under this section shall
    be granted and may, in its sole discretion, decline to entertain
    any application for an order of exemption under this section.
      (C)(i) A broker or dealer that is registered as a futures
    commission merchant or introducing broker pursuant to paragraph (2)
    or an associated person thereof, or that is a floor broker or floor
    trader exempt from registration pursuant to paragraph (3), shall
    not be required to become a member of any futures association
    registered under section 21 of this title.
      (ii) No futures association registered under section 21 of this
    title shall limit its members from carrying an account, accepting
    an order, or transacting business with a broker or dealer that is
    registered as a futures commission merchant or introducing broker
    pursuant to paragraph (2) or an associated person thereof, or that
    is a floor broker or floor trader exempt from registration pursuant
    to paragraph (3).
    (b) Financial requirements for futures commission merchants and
      introducing brokers
      Notwithstanding any other provisions of this chapter, no person
    desiring to register as futures commission merchant or as
    introducing broker shall be so registered unless he meets such
    minimum financial requirements as the Commission may by regulation
    prescribe as necessary to insure his meeting his obligation as a
    registrant, and each person so registered shall at all times
    continue to meet such prescribed minimum financial requirements:
    Provided, That such minimum financial requirements will be
    considered met if the applicant for registration or registrant is a
    member of a contract market or derivatives transaction execution
    facility and conforms to minimum financial standards and related
    reporting requirements set by such contract market or derivatives
    transaction execution facility in its bylaws, rules, regulations,
    or resolutions and approved by the Commission as adequate to
    effectuate the purposes of this subsection.
    (c) Risk assessment for holding company systems
      (1) As used in this subsection:
        (i) The term "affiliated person" means any person directly or
      indirectly controlling, controlled by, or under common control
      with a futures commission merchant, as the Commission, by rule or
      regulation, may determine will effectuate the purposes of this
      subsection.
        (ii) The term "Federal banking agency" shall have the same
      meaning as the term "appropriate Federal banking agency" in
      section 1813(q) of title 12.

      (2)(A) Each registered futures commission merchant shall obtain
    such information and make and keep such records as the Commission,
    by rule or regulation, prescribes concerning the registered futures
    commission merchant's policies, procedures, or systems for
    monitoring and controlling financial and operational risks to it
    resulting from the activities of any of its affiliated persons,
    other than a natural person.
      (B) The records required under subparagraph (A) shall describe,
    in the aggregate, each of the futures and other financial
    activities conducted by, and the customary sources of capital and
    funding of, those of its affiliated persons whose business
    activities are reasonably likely to have a material impact on the
    financial or operational condition of the futures commission
    merchant, including its adjusted net capital, its liquidity, or its
    ability to conduct or finance its operations.
      (C) The Commission, by rule or regulation, may require summary
    reports of such information to be filed by the futures commission
    merchant with the Commission no more frequently than quarterly.
      (3)(A),(!2) If, as a result of adverse market conditions or based
    on reports provided to the Commission pursuant to paragraph (2) or
    other available information, the Commission reasonably concludes
    that the Commission has concerns regarding the financial or
    operational condition of any registered futures commission
    merchant, the Commission may require the futures commission
    merchant to make reports concerning the futures and other financial
    activities of any of such person's affiliated persons, other than a
    natural person, whose business activities are reasonably likely to
    have a material impact on the financial or operational condition of
    the futures commission merchant.

      (B) The Commission, in requiring reports pursuant to this
    paragraph, shall specify the information required, the period for
    which it is required, the time and date on which the information
    must be furnished, and whether the information is to be furnished
    directly to the Commission or to a contract market or derivatives
    transaction execution facility or other self-regulatory
    organization with primary responsibility for examining the
    registered futures commission merchant's financial and operational
    condition.
      (4)(A) in (!3) developing and implementing reporting requirements
    pursuant to paragraph (2) with respect to affiliated persons
    subject to examination by or reporting requirements of a Federal
    banking agency, the Commission shall consult with and consider the
    views of each such Federal banking agency. If a Federal banking
    agency comments in writing on a proposed rule of the Commission
    under this subsection that has been published for comment, the
    Commission shall respond in writing to the written comment before
    adopting the proposed rule. The Commission shall, at the request of
    the Federal banking agency, publish the comment and response in the
    Federal Register at the time of publishing the adopted rule.

      (B)(i) Except as provided in clause (ii), a registered futures
    commission merchant shall be considered to have compiled (!4) with
    a recordkeeping or reporting requirement adopted pursuant to
    paragraph (2) concerning an affiliated person that is subject to
    examination by, or reporting requirements of, a Federal banking
    agency if the futures commission merchant utilizes for the
    recordkeeping or reporting requirement copies of reports filed by
    the affiliated person with the Federal banking agency pursuant to
    section 161 of title 12, section 9 of the Federal Reserve Act (12
    U.S.C. 321 et seq.), section 1817(a) of title 12, section 1467a(b)
    of title 12, or section 1844 of title 12.

      (ii) The Commission may, by rule adopted pursuant to paragraph
    (2), require any futures commission merchant filing the reports
    with the Commission to obtain, maintain, or report supplemental
    information if the Commission makes an explicit finding that the
    supplemental information is necessary to inform the Commission
    regarding potential risks to the futures commission merchant. Prior
    to requiring any such supplemental information, the Commission
    shall first request the Federal banking agency to expand its
    reporting requirements to include the information.
      (5) Prior to making a request pursuant to paragraph (3) for
    information with respect to an affiliated person that is subject to
    examination by or reporting requirements of a Federal banking
    agency, the Commission shall - 
        (A) notify the agency of the information required with respect
      to the affiliated person; and
        (B) consult with the agency to determine whether the
      information required is available from the agency and for other
      purposes, unless the Commission determines that any delay
      resulting from the consultation would be inconsistent with
      ensuring the financial and operational condition of the futures
      commission merchant or the stability or integrity of the futures
      markets.

      (6) Nothing in this subsection shall be construed to permit the
    Commission to require any futures commission merchant to obtain,
    maintain, or furnish any examination report of any Federal banking
    agency or any supervisory recommendations or analysis contained in
    the report.
      (7) No information provided to or obtained by the Commission from
    any Federal banking agency pursuant to a request under paragraph
    (5) regarding any affiliated person that is subject to examination
    by or reporting requirements of a Federal banking agency may be
    disclosed to any other person (other than as provided in section 12
    of this title or section 12a(6) of this title), without the prior
    written approval of the Federal banking agency.
      (8) The Commission shall notify a Federal banking agency of any
    concerns of the Commission regarding significant financial or
    operational risks resulting from the activities of any futures
    commission merchant to any affiliated person thereof that is
    subject to examination by or reporting requirements of the Federal
    banking agency.
      (9) The Commission, by rule, regulation, or order, may exempt any
    person or class of persons under such terms and conditions and for
    such periods as the Commission shall provide in the rule,
    regulation, or order, from this subsection and the rules and
    regulations issued under this subsection. In granting the
    exemption, the Commission shall consider, among other factors - 
        (A) whether information of the type required under this
      subsection is available from a supervisory agency (as defined in
      section 3401(7) of title 12), a State insurance commission or
      similar State agency, the Securities and Exchange Commission, or
      a similar foreign regulator;
        (B) the primary business of any affiliated person;
        (C) the nature and extent of domestic or foreign regulation of
      the affiliated person's activities;
        (D) the nature and extent of the registered futures commission
      merchant's commodity futures and options activities; and
        (E) with respect to the registered futures commission merchant
      and its affiliated persons, on a consolidated basis, the amount
      and proportion of assets devoted to, and revenues derived from
      activities in the United States futures markets.

      (10) Information required to be provided pursuant to this
    subsection shall be subject to section 12 of this title. Except as
    specifically provided in section 12 of this title and
    notwithstanding any other provision of law, the Commission shall
    not be compelled to disclose any information required to be
    reported under this subsection, or any information supplied to the
    Commission by any domestic or foreign regulatory agency that
    relates to the financial or operational condition of any affiliated
    person of a registered futures commission merchant.
      (11) Nothing in paragraphs (1) through (10) shall be construed to
    supersede or to limit in any way the authority or powers of the
    Commission pursuant to any other provision of this chapter or
    regulations issued under this chapter.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4f, as added June 15, 1936, ch. 545,
    Sec. 5, 49 Stat. 1495; amended Pub. L. 90-258, Sec. 7, Feb. 19,
    1968, 82 Stat. 28; Pub. L. 93-463, title I, Sec. 103(a), Oct. 23,
    1974, 88 Stat. 1392; Pub. L. 95-405, Sec. 5, Sept. 30, 1978, 92
    Stat. 869; Pub. L. 97-444, title II, Sec. 208, Jan. 11, 1983, 96
    Stat. 2302; Pub. L. 102-546, title II, Secs. 207(b)(1), 229, Oct.
    28, 1992, 106 Stat. 3604, 3619; Pub. L. 106-554, Sec. 1(a)(5)
    [title I, Sec. 123(a)(6), title II, Sec. 252(b), (c)], Dec. 21,
    2000, 114 Stat. 2763, 2763A-407, 2763A-447.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      Section 6p of this title, referred to in subsec. (a)(4)(A)(vi),
    was in the original "Section 4p" which was translated as meaning
    the section 4p of the Commodity Exchange Act which is classified to
    section 6p of this title, rather than to the section 4p of that Act
    which is classified to section 6o-1 of this title, to reflect the
    probable intent of Congress.
      Section 9 of the Federal Reserve Act, referred to in subsec.
    (c)(4)(B)(i), is section 9 of act Dec. 23, 1913, ch. 6, 38 Stat.
    251, as amended, which is classified generally to subchapter VIII
    (Sec. 321 et seq.) of chapter 3 of Title 12, Banks and Banking.

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (a). Pub. L. 106-554, Sec. 1(a)(5) [title II, Sec.
    252(b)], designated existing provisions as par. (1) and added pars.
    (2) and (3).
      Subsec. (a)(4). Pub. L. 106-554, Sec. 1(a)(5) [title II, Sec.
    252(c)], added par. (4).
      Subsecs. (b), (c)(3)(B). Pub. L. 106-554, Sec. 1(a)(5) [title I,
    Sec. 123(a)(6)], inserted "or derivatives transaction execution
    facility" after "contract market" wherever appearing.
      1992 - Subsec. (a). Pub. L. 102-546, Secs. 207(b)(1), 229(1),
    redesignated par. (1) as subsec. (a) and substituted "floor broker,
    or floor trader" for "or floor broker".
      Subsec. (b). Pub. L. 102-546, Sec. 229(1), (2), redesignated par.
    (2) as subsec. (b) and substituted "this subsection" for "this
    paragraph (2)".
      Subsec. (c). Pub. L. 102-546, Sec. 229(3), added subsec. (c).
      1983 - Par. (1). Pub. L. 97-444, Sec. 208(1), made grammatical
    changes, made registration provisions applicable to introducing
    brokers, and substituted "revoked pursuant to the provisions of
    this chapter" for "revoked after notice and hearing as prescribed
    in this chapter".
      Par. (2). Pub. L. 97-444, Sec. 208(2), made financial
    requirements applicable to introducing brokers.
      1978 - Par. (1). Pub. L. 95-405 substituted "Each registration
    shall expire on December 31 of the year for which issued or at such
    other time, not less than one year from the date of issuance, as
    the Commission may by rule, regulation, or order prescribe" for
    "All registrations shall expire on the 31st day of December of the
    year for which issued".
      1974 - Pub. L. 93-463 substituted "Commission" for "Secretary of
    Agriculture".
      1968 - Par. (1). Pub. L. 90-258, Sec. 7(a), substituted "this
    chapter" for "section 6g of this title".
      Par. (2). Pub. L. 90-258, Sec. 7(b), substituted provisions that
    prescribed financial requirements for registration as futures
    commission merchant be met and continued at all times and that such
    requirements will be considered met by membership in a contract
    market and compliance with its minimum financial standards and
    related reporting requirements for former provisions for display of
    futures commission merchants' registration certificates.

                     EFFECTIVE DATE OF 1992 AMENDMENT                 
      Amendment by section 207(b)(1) of Pub. L. 102-546 effective 180
    days after Oct. 28, 1992, with Commodity Futures Trading Commission
    to issue any regulations necessary to implement such amendment no
    later than 180 days after Oct. 28, 1992, see section 207(c) of Pub.
    L. 102-546, set out as a note under section 6e of this title.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1968 AMENDMENT                 
      Amendment by Pub. L. 90-258 effective 120 days after Feb. 19,
    1968, see section 28 of Pub. L. 90-258, set out as a note under
    section 2 of this title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 13 of act June 15,
    1936, set out as an Effective Date of 1936 Amendment note under
    section 1 of this title.

-FOOTNOTE-
    (!1) See References in Text note below.

    (!2) So in original. The comma probably should not appear.

    (!3) So in original. Probably should be capitalized.

    (!4) So in original. Probably should be "complied".

-End-

-CITE-
    7 USC Sec. 6g                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6g. Reporting and recordkeeping

-STATUTE-
    (a) In general
      Every person registered hereunder as futures commission merchant,
    introducing broker, floor broker, or floor trader shall make such
    reports as are required by the Commission regarding the
    transactions and positions of such person, and the transactions and
    positions of the customer thereof, in commodities for future
    delivery on any board of trade in the United States or elsewhere;
    shall keep books and records pertaining to such transactions and
    positions in such form and manner and for such period as may be
    required by the Commission; and shall keep such books and records
    open to inspection by any representative of the Commission or the
    United States Department of Justice.
    (b) Daily trading records: registered entities
      Every registered entity shall maintain daily trading records. The
    daily trading records shall include such information as the
    Commission shall prescribe by rule.
    (c) Daily trading records: floor brokers, introducing brokers, and
      futures commission merchants
      Floor brokers, introducing brokers, and futures commission
    merchants shall maintain daily trading records for each customer in
    such manner and form as to be identifiable with the trades referred
    to in subsection (b) of this section.
    (d) Daily trading records: form and reports
      Daily trading records shall be maintained in a form suitable to
    the Commission for such period as may be required by the
    Commission. Reports shall be made from the records maintained at
    such times and at such places and in such form as the Commission
    may prescribe by rule, order, or regulation in order to protect the
    public interest and the interest of persons trading in commodity
    futures.
    (e) Disclosure of information
      Before the beginning of trading each day, the exchange shall,
    insofar as is practicable and under terms and conditions specified
    by the Commission, make public the volume of trading on each type
    of contract for the previous day and such other information as the
    Commission deems necessary in the public interest and prescribes by
    rule, order, or regulation.
    (f) Authority of Commission to make separate determinations
      unimpaired
      Nothing contained in this section shall be construed to prohibit
    the Commission from making separate determinations for different
    registered entities when such determinations are warranted in the
    judgment of the Commission.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4g, as added June 15, 1936, ch. 545,
    Sec. 5, 49 Stat. 1496; amended Pub. L. 90-258, Sec. 8, Feb. 19,
    1968, 82 Stat. 28; Pub. L. 93-463, title I, Sec. 103(a), (f), title
    IV, Sec. 415, Oct. 23, 1974, 88 Stat. 1392, 1415; Pub. L. 95-405,
    Sec. 6, Sept. 30, 1978, 92 Stat. 869; Pub. L. 97-444, title II,
    Sec. 209, Jan. 11, 1983, 96 Stat. 2302; Pub. L. 102-546, title II,
    Sec. 207(b)(1), title IV, Sec. 402(5), Oct. 28, 1992, 106 Stat.
    3604, 3624; Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(7)], Dec. 21, 2000, 114 Stat. 2763, 2763A-407.)

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (b). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(7)(A)], substituted "registered entity" for "clearinghouse
    and contract market".
      Subsec. (f). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(7)(B)], substituted "registered entities" for
    "clearinghouses, contract markets, and exchanges".
      1992 - Subsec. (a). Pub. L. 102-546, Secs. 207(b)(1), 402(5)(A),
    redesignated par. (1) as subsec. (a) and substituted "floor broker,
    or floor trader" for "or floor broker".
      Subsec. (b). Pub. L. 102-546, Sec. 402(5)(A), redesignated par.
    (2) as subsec. (b).
      Subsec. (c). Pub. L. 102-546, Sec. 402(5), redesignated par. (3)
    as subsec. (c) and substituted "subsection (b)" for "paragraph
    (2)".
      Subsecs. (d) to (f). Pub. L. 102-546, Sec. 402(5)(A),
    redesignated pars. (4) to (6) as subsecs. (d) to (f), respectively.
      1983 - Par. (1). Pub. L. 97-444, Sec. 209(1), made reporting and
    recordkeeping requirements applicable to introducing brokers.
      Par. (2). Pub. L. 97-444, Sec. 209(2), made customer daily
    trading records requirement applicable to introducing brokers.
      1978 - Par. (3). Pub. L. 95-405 substituted "Floor brokers" for
    "Brokers".
      1974 - Par. (1). Pub. L. 93-463, Secs. 103(a), (f), 415,
    designated existing provisions as par. (1) and substituted
    "Commission" for "Secretary of Agriculture" and "United States
    Department of Agriculture".
      Pars. (2) to (6). Pub. L. 93-463, Sec. 415, added pars. (2) to
    (6).
      1968 - Pub. L. 90-258 rephrased existing provisions to express
    reporting and recordkeeping requirements as a positive obligation
    of futures commission merchants and floor brokers, rather than as a
    ground for revoking or suspending registration and struck out
    provisions for revocation or suspension of registration. See
    section 9 of this title.

                     EFFECTIVE DATE OF 1992 AMENDMENT                 
      Amendment by section 207(b)(1) of Pub. L. 102-546 effective 180
    days after Oct. 28, 1992, with Commodity Futures Trading Commission
    to issue any regulations necessary to implement such amendment no
    later than 180 days after Oct. 28, 1992, see section 207(c) of Pub.
    L. 102-546, set out as a note under section 6e of this title.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463 see section 418
    of Pub. L. 93-463, set out as a note under section 2 of this title.

                     EFFECTIVE DATE OF 1968 AMENDMENT                 
      Amendment by Pub. L. 90-258 effective 120 days after Feb. 19,
    1968, see section 28 of Pub. L. 90-258, set out as a note under
    section 2 of this title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 13 of act June 15,
    1936, set out as an Effective Date of 1936 Amendment note under
    section 1 of this title.

-End-

-CITE-
    7 USC Sec. 6h                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6h. False self-representation as registered entity member
      prohibited

-STATUTE-
      It shall be unlawful for any person falsely to represent such
    person to be a member of a registered entity or the representative
    or agent of such member, or to be a registrant under this chapter
    or the representative or agent of any registrant, in soliciting or
    handling any order or contract for the purchase or sale of any
    commodity in interstate commerce or for future delivery, or falsely
    to represent in connection with the handling of any such order or
    contract that the same is to be or has been executed on, or by or
    through a member of, any registered entity.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4h, as added June 15, 1936, ch. 545,
    Sec. 5, 49 Stat. 1496; amended Pub. L. 97-444, title II, Sec. 210,
    Jan. 11, 1983, 96 Stat. 2302; Pub. L. 106-554, Sec. 1(a)(5) [title
    I, Sec. 123(a)(8)], Dec. 21, 2000, 114 Stat. 2763, 2763A-407.)

-MISC1-
                                AMENDMENTS                            
      2000 - Pub. L. 106-554 substituted "registered entity" for
    "contract market" in two places.
      1983 - Pub. L. 97-444 struck out provisions formerly designated
    as par. (1) relating to conduct of offices or places of business
    anywhere in the United States or its territories that were used for
    dealing in commodities for future delivery unless such dealings
    were executed or consummated by or through a member of a contract
    market, which provisions were transferred to section 6(a) of this
    title, and broadened remaining provisions, formerly designated as
    par. (2), to prohibit false representations that a person is
    registered with the Commission in any capacity, and not only as a
    futures commission merchant, as previously provided.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 13 of act June 15,
    1936, set out as an Effective Date of 1936 Amendment note under
    section 1 of this title.

-End-

-CITE-
    7 USC Sec. 6i                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6i. Reports of deals equal to or in excess of trading limits;
      books and records; cash and controlled transactions

-STATUTE-
      It shall be unlawful for any person to make any contract for the
    purchase or sale of any commodity for future delivery on or subject
    to the rules of any contract market or derivatives transaction
    execution facility - 
        (1) if such person shall directly or indirectly make such
      contracts with respect to any commodity or any future of such
      commodity during any one day in an amount equal to or in excess
      of such amount as shall be fixed from time to time by the
      Commission, and
        (2) if such person shall directly or indirectly have or obtain
      a long or short position in any commodity or any future of such
      commodity equal to or in excess of such amount as shall be fixed
      from time to time by the Commission,

    unless such person files or causes to be filed with the properly
    designated officer of the Commission such reports regarding any
    transactions or positions described in clauses (1) and (2) hereof
    as the Commission may by rule or regulation require and unless, in
    accordance with rules and regulations of the Commission, such
    person shall keep books and records of all such transactions and
    positions and transactions and positions in any such commodity
    traded on or subject to the rules of any other board of trade, and
    of cash or spot transactions in, and inventories and purchase and
    sale commitments of such commodity. Such books and records shall
    show complete details concerning all such transactions, positions,
    inventories, and commitments, including the names and addresses of
    all persons having any interest therein, and shall be open at all
    times to inspection by any representative of the Commission or the
    Department of Justice. For the purposes of this section, the
    futures and cash or spot transactions and positions of any person
    shall include such transactions and positions of any persons
    directly or indirectly controlled by such person.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4i, as added June 15, 1936, ch. 545,
    Sec. 5, 49 Stat. 1496; amended Pub. L. 90-258, Sec. 9, Feb. 19,
    1968, 82 Stat. 28; Pub. L. 93-463, title I, Sec. 103(a), (f), Oct.
    23, 1974, 88 Stat. 1392; Pub. L. 97-444, title II, Sec. 211, Jan.
    11, 1983, 96 Stat. 2303; Pub. L. 106-554, Sec. 1(a)(5) [title I,
    Sec. 123(a)(9)], Dec. 21, 2000, 114 Stat. 2763, 2763A-407.)

-MISC1-
                                AMENDMENTS                            
      2000 - Pub. L. 106-554 inserted "or derivatives transaction
    execution facility" after "contract market" in introductory
    provisions.
      1983 - Pub. L. 97-444 amended section generally by substantially
    restating provisions and inserting requirement that persons whose
    transactions and positions in any cash commodity or commodity
    future are equal to or in excess of amounts fixed by the
    Commission, must keep books and records of such transactions and
    positions as well as books and records of any such commodity traded
    on or subject to rules of any other board of trade, whether or not
    such person is required to file reports with the Commission
    concerning such transactions and positions.
      1974 - Pub. L. 93-463 substituted "Commission" for "Secretary of
    Agriculture" and "United States Department of Agriculture".
      1968 - Pub. L. 90-258 required recordkeeping of positions and of
    cash or spot transactions in commodities entered into, and
    inventories and purchase and sale commitments of commodities held,
    in any month in which reports are required to be kept, including
    details concerning positions, inventories, and commitments, and
    included controlled transactions and positions in the futures and
    cash or spot transactions and positions of any person.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1968 AMENDMENT                 
      Amendment by Pub. L. 90-258 effective 120 days after Feb. 19,
    1968, see section 28 of Pub. L. 90-258, set out as a note under
    section 2 of this title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 13 of act June 15,
    1936, set out as an Effective Date of 1936 Amendment note under
    section 1 of this title.

-End-

-CITE-
    7 USC Sec. 6j                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6j. Restrictions on dual trading in security futures products
      on designated contract markets and registered derivatives
      transaction execution facilities

-STATUTE-
    (a) Issuance of regulations
      The Commission shall issue regulations to prohibit the privilege
    of dual trading in security futures products on each contract
    market and registered derivatives transaction execution facility.
    The regulations issued by the Commission under this section - 
        (1) shall provide that the prohibition of dual trading
      thereunder shall take effect upon issuance of the regulations;
      and
        (2) shall provide exceptions, as the Commission determines
      appropriate, to ensure fairness and orderly trading in security
      futures product markets, including - 
          (A) exceptions for spread transactions and the correction of
        trading errors;
          (B) allowance for a customer to designate in writing not less
        than once annually a named floor broker to execute orders for
        such customer, notwithstanding the regulations to prohibit the
        privilege of dual trading required under this section; and
          (C) other measures reasonably designed to accommodate unique
        or special characteristics of individual boards of trade or
        contract markets, to address emergency or unusual market
        conditions, or otherwise to further the public interest
        consistent with the promotion of market efficiency, innovation,
        and expansion of investment opportunities, the protection of
        investors, and with the purposes of this section.
    (b) "Dual trading" defined
      As used in this section, the term "dual trading" means the
    execution of customer orders by a floor broker during the same
    trading session in which the floor broker executes any trade in the
    same contract market or registered derivatives transaction
    execution facility for - 
        (1) the account of such floor broker;
        (2) an account for which such floor broker has trading
      discretion; or
        (3) an account controlled by a person with whom such floor
      broker has a relationship through membership in a broker
      association.
    (c) "Broker association" defined
      As used in this section, the term "broker association" shall
    include two or more contract market members or registered
    derivatives transaction execution facility members with floor
    trading privileges of whom at least one is acting as a floor
    broker, who - 
        (1) engage in floor brokerage activity on behalf of the same
      employer,
        (2) have an employer and employee relationship which relates to
      floor brokerage activity,
        (3) share profits and losses associated with their brokerage or
      trading activity, or
        (4) regularly share a deck of orders.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4j, as added Pub. L. 93-463, title
    II, Sec. 203, Oct. 23, 1974, 88 Stat. 1396; amended Pub. L. 94-16,
    Sec. 2, Apr. 16, 1975, 89 Stat. 77; Pub. L. 102-546, title I, Secs.
    101, 102(a), Oct. 28, 1992, 106 Stat. 3591, 3594; Pub. L. 106-554,
    Sec. 1(a)(5) [title II, Sec. 251(c)], Dec. 21, 2000, 114 Stat.
    2763, 2763A-442.)

-MISC1-
                                AMENDMENTS                            
      2000 - Pub. L. 106-554 amended section generally. Prior to
    amendment, section required Commission to issue regulations to
    prohibit the privilege of dual trading on contract markets, allowed
    for certain exemptions, required Commission to make determinations
    relating to trading by floor brokers and futures commission
    merchants, and restricted trading among members of broker
    associations.
      1992 - Subsec. (a). Pub. L. 102-546, Sec. 101(a)(3), added
    subsec. (a).
      Subsec. (b). Pub. L. 102-546, Sec. 101(a)(1), (2), redesignated
    par. (1) as subsec. (b) and substituted "If, in addition to the
    regulations issued pursuant to subsection (a) of this section, the
    Commission has reason to believe that dual trading-related or
    facilitated abuses are not being or cannot be effectively addressed
    by subsection (a) of this section, the Commission shall" for "The
    Commission shall within nine months after the effective date of the
    Commodity Futures Trading Commission Act of 1974, and subsequently
    when it determines that changes are required,".
      Subsec. (c). Pub. L. 102-546, Sec. 101(a)(1), redesignated par.
    (2) as subsec. (c).
      Subsec. (d). Pub. L. 102-546, Sec. 102(a), added subsec. (d).
      1975 - Pub. L. 94-16 substituted "nine months" for "six months"
    in pars. (1) and (2).

                     EFFECTIVE DATE OF 1992 AMENDMENT                 
      Section 102(b) of Pub. L. 102-546 provided that: "The amendment
    made by subsection (a) [amending this section] shall become
    effective two hundred and seventy days after the date of enactment
    of this Act [Oct. 28, 1992]."

                              EFFECTIVE DATE                          
      For effective date of section, see section 418 of Pub. L. 93-463,
    set out as an Effective Date of 1974 Amendment note under section 2
    of this title.

-End-

-CITE-
    7 USC Sec. 6k                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6k. Registration of associates of futures commission
      merchants, commodity pool operators, and commodity trading
      advisors; required disclosure of disqualifications; exemptions
      for associated persons

-STATUTE-
      (1) It shall be unlawful for any person to be associated with a
    futures commission merchant as a partner, officer, or employee, or
    to be associated with an introducing broker as a partner, officer,
    employee, or agent (or any person occupying a similar status or
    performing similar functions), in any capacity that involves (i)
    the solicitation or acceptance of customers' orders (other than in
    a clerical capacity) or (ii) the supervision of any person or
    persons so engaged, unless such person is registered with the
    Commission under this chapter as an associated person of such
    futures commission merchant or of such introducing broker and such
    registration shall not have expired, been suspended (and the period
    of suspension has not expired), or been revoked. It shall be
    unlawful for a futures commission merchant or introducing broker to
    permit such a person to become or remain associated with the
    futures commission merchant or introducing broker in any such
    capacity if such futures commission merchant or introducing broker
    knew or should have known that such person was not so registered or
    that such registration had expired, been suspended (and the period
    of suspension has not expired), or been revoked. Any individual who
    is registered as a floor broker, futures commission merchant, or
    introducing broker (and such registration is not suspended or
    revoked) need not also register under this paragraph.
      (2) It shall be unlawful for any person to be associated with a
    commodity pool operator as a partner, officer, employee,
    consultant, or agent (or any person occupying a similar status or
    performing similar functions), in any capacity that involves (i)
    the solicitation of funds, securities, or property for a
    participation in a commodity pool or (ii) the supervision of any
    person or persons so engaged, unless such person is registered with
    the Commission under this chapter as an associated person of such
    commodity pool operator and such registration shall not have
    expired, been suspended (and the period of suspension has not
    expired), or been revoked. It shall be unlawful for a commodity
    pool operator to permit such a person to become or remain
    associated with the commodity pool operator in any such capacity if
    the commodity pool operator knew or should have known that such
    person was not so registered or that such registration had expired,
    been suspended (and the period of suspension has not expired), or
    been revoked. Any individual who is registered as a floor broker,
    futures commission merchant, introducing broker, commodity pool
    operator, or as an associated person of another category of
    registrant under this section (and such registration is not
    suspended or revoked) need not also register under this paragraph.
    The Commission may exempt any person or class of persons from
    having to register under this paragraph by rule, regulation, or
    order.
      (3) It shall be unlawful for any person to be associated with a
    commodity trading advisor as a partner, officer, employee,
    consultant, or agent (or any person occupying a similar status or
    performing similar functions), in any capacity which involves (i)
    the solicitation of a client's or prospective client's
    discretionary account or (ii) the supervision of any person or
    persons so engaged, unless such person is registered with the
    Commission under this chapter as an associated person of such
    commodity trading advisor and such registration shall not have
    expired, been suspended (and the period of suspension has not
    expired), or been revoked. It shall be unlawful for a commodity
    trading advisor to permit such a person to become or remain
    associated with the commodity trading advisor in any such capacity
    if the commodity trading advisor knew or should have known that
    such person was not so registered or that such registration had
    expired, been suspended (and the period of suspension has not
    expired), or been revoked. Any individual who is registered as a
    floor broker, futures commission merchant, introducing broker,
    commodity trading advisor, or as an associated person of another
    category of registrant under this section (and such registration is
    not suspended or revoked) need not also register under this
    paragraph. The Commission may exempt any person or class of persons
    from having to register under this paragraph by rule, regulation,
    or order.
      (4) Any person desiring to be registered as an associated person
    of a futures commission merchant, of an introducing broker, of a
    commodity pool operator, or of a commodity trading advisor shall
    make application to the Commission in the form and manner
    prescribed by the Commission, giving such information and facts as
    the Commission may deem necessary concerning the applicant. Such
    person, when registered hereunder, shall likewise continue to
    report and furnish to the Commission such information as the
    Commission may require. Such registration shall expire at such time
    as the Commission may by rule, regulation, or order prescribe.
      (5) (!1) It shall be unlawful for any registrant to permit a
    person to become or remain an associated person of such registrant,
    if the registrant knew or should have known of facts regarding such
    associated person that are set forth as statutory disqualifications
    in section 12a(2) of this title, unless such registrant has
    notified the Commission of such facts and the Commission has
    determined that such person should be registered or temporarily
    licensed.

      (5) (!1) Any associated person of a broker or dealer that is
    registered with the Securities and Exchange Commission, and who
    limits its solicitation of orders, acceptance of orders, or
    execution of orders, or placing of orders on behalf of others
    involving any contracts of sale of any commodity for future
    delivery or any option on such a contract, on or subject to the
    rules of any contract market or registered derivatives transaction
    execution facility to security futures products, shall be exempt
    from the following provisions of this chapter and the rules
    thereunder:
        (A) Subsections (b), (d), (e), and (g) of section 6c of this
      title.
        (B) Sections 6d, 6e, and 6h of this title.
        (C) Subsections (b) and (c) of section 6f of this title.
        (D) Section 6j of this title.
        (E) Paragraph (1) of this section.
        (F) Section 6p (!2) of this title.

        (G) Section 13a-2 of this title.
        (H) Subsections (d) and (g) of section 12 of this title.
        (I) Section 20 of this title.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4k, as added Pub. L. 93-463, title
    II, Sec. 204(a), Oct. 23, 1974, 88 Stat. 1396; amended Pub. L. 95-
    405, Sec. 7, Sept. 30, 1978, 92 Stat. 869; Pub. L. 97-444, title
    II, Sec. 212, Jan. 11, 1983, 96 Stat. 2303; Pub. L. 106-554, Sec.
    1(a)(5) [title II, Sec. 252(d)], Dec. 21, 2000, 114 Stat. 2763,
    2763A-448.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      Section 6p of this title, referred to in par. (5)(F), was in the
    original "Section 4p" which was translated as meaning the section
    4p of the Commodity Exchange Act which is classified to section 6p
    of this title, rather than to the section 4p of that Act which is
    classified to section 6o-1 of this title, to reflect the probable
    intent of Congress.

-MISC1-
                                AMENDMENTS                            
      2000 - Par. (5). Pub. L. 106-554, Sec. 1(a)(5) [title II, Sec.
    252(d)], which directed amendment of this section by "inserting
    after paragraph (4), as added by subsection (c) of this section" a
    new par. (5) relating to exempting associated persons or dealers
    from provisions of this chapter, was executed by adding that par.
    (5) at the end. Section 1(a)(5)[title II, Sec. 252(c)] did not add
    a par. (4) to this section.
      1983 - Par. (1). Pub. L. 97-444 amended par. (1) generally to
    apply to introducing brokers and persons associated with
    introducing brokers.
      Par. (2). Pub. L. 97-444 added par. (2). Former par. (2)
    redesignated (4).
      Par. (3). Pub. L. 97-444 added par. (3). Former par. (3), which
    empowered Commission to authorize a registered futures association
    to perform any portion of the registration functions under this
    section, in accordance with rules approved by the Commission, and
    subject to the provisions of this chapter applicable to
    registrations granted by the Commission, was struck out.
      Par. (4). Pub. L. 97-444 redesignated former par. (2) as (4) and
    substituted "Any person desiring to be registered as an associated
    person of a futures commission merchant, of an introducing broker,
    of a commodity pool operator, or of a commodity trading advisor
    shall make application to the Commission in the form and manner
    prescribed by the Commission, giving such information and facts as
    the Commission may deem necessary concerning the applicant. Such
    person, when registered hereunder, shall likewise continue to
    report and furnish to the Commission such information as the
    Commission may require. Such registration shall expire at such time
    as the Commission may by rule, regulation, or order prescribe" for
    "Any such person desiring to be registered shall make application
    to the Commission in the form and manner prescribed by the
    Commission, giving such information and facts as the Commission may
    deem necessary concerning the applicant. Such person, when
    registered hereunder, shall likewise continue to report and furnish
    to the Commission such information as the Commission may require.
    Such registration shall expire two years after the effective date
    thereof or at such other time, not less than one year from the date
    of issuance thereof, as the Commission may by rule, regulation, or
    order prescribe and shall be renewed upon application therefor,
    unless the registration has been suspended (and the period of such
    suspension has not expired) or revoked after notice and hearing as
    prescribed in section 9 of this title: Provided, That upon initial
    registration, unless the Commission otherwise prescribes by rule,
    regulation, or order, the effective period of such registration
    shall be not more than two years nor less than one year from the
    effective date thereof".
      Par. (5). Pub. L. 97-444 added par. (5).
      1978 - Par. (2). Pub. L. 95-405, Sec. 7(1), inserted provisions
    authorizing the Commission to prescribe the period of registration
    of not less than one year for associated persons.
      Par. (3). Pub. L. 95-405, Sec. 7(2), added par. (3).

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective 120 days after Jan. 11,
    1983, or such earlier date as the Commission shall prescribe by
    regulation, see section 239 of Pub. L. 97-444, set out as a note
    under section 2 of this title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 418 of Pub. L. 93-463,
    set out as an Effective Date of 1974 Amendment note under section 2
    of this title.

-FOOTNOTE-
    (!1) So in original. Two pars.(5) have been enacted.

    (!2) See References in Text note below.

-End-

-CITE-
    7 USC Sec. 6l                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6l. Commodity trading advisors and commodity pool operators;
      Congressional finding

-STATUTE-
      It is hereby found that the activities of commodity trading
    advisors and commodity pool operators are affected with a national
    public interest in that, among other things - 
        (1) their advice, counsel, publications, writings, analyses,
      and reports are furnished and distributed, and their contracts,
      solicitations, subscriptions, agreements, and other arrangements
      with clients take place and are negotiated and performed by the
      use of the mails and other means and instrumentalities of
      interstate commerce;
        (2) their advice, counsel, publications, writings, analyses,
      and reports customarily relate to and their operations are
      directed toward and cause the purchase and sale of commodities
      for future delivery on or subject to the rules of contract
      markets or derivatives transaction execution facilities; and
        (3) the foregoing transactions occur in such volume as to
      affect substantially transactions on contract markets or
      derivatives transaction execution facilities.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4l, as added Pub. L. 93-463, title
    II, Sec. 205(a), Oct. 23, 1974, 88 Stat. 1397; Pub. L. 106-554,
    Sec. 1(a)(5) [title I, Sec. 123(a)(10)], Dec. 21, 2000, 114 Stat.
    2763, 2763A-408.)

-MISC1-
                                AMENDMENTS                            
      2000 - Pars. (2), (3). Pub. L. 106-554 inserted "or derivatives
    transaction execution facilities" after "contract markets".

                              EFFECTIVE DATE                          
      For effective date of section, see section 418 of Pub. L. 93-463,
    set out as an Effective Date of 1974 Amendment note under section 2
    of this title.

-End-

-CITE-
    7 USC Sec. 6m                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6m. Use of mails or other means or instrumentalities of
      interstate commerce by commodity trading advisors and commodity
      pool operators; relation to other law

-STATUTE-
      (1) It shall be unlawful for any commodity trading advisor or
    commodity pool operator, unless registered under this chapter, to
    make use of the mails or any means or instrumentality of interstate
    commerce in connection with his business as such commodity trading
    advisor or commodity pool operator: Provided, That the provisions
    of this section shall not apply to any commodity trading advisor
    who, during the course of the preceding twelve months, has not
    furnished commodity trading advice to more than fifteen persons and
    who does not hold himself out generally to the public as a
    commodity trading advisor. The provisions of this section shall not
    apply to any commodity trading advisor who is a (1) dealer,
    processor, broker, or seller in cash market transactions of any
    commodity specifically set forth in section 2(a) of this title
    prior to October 23, 1974, (or products thereof) or (2) nonprofit,
    voluntary membership, general farm organization, who provides
    advice on the sale or purchase of any commodity specifically set
    forth in section 2(a) of this title prior to October 23, 1974; if
    the advice by the person described in clause (1) or (2) of this
    sentence as a commodity trading advisor is solely incidental to the
    conduct of that person's business: Provided, That such person shall
    be subject to proceedings under section 18 of this title.
      (2) Nothing in this chapter shall relieve any person of any
    obligation or duty, or affect the availability of any right or
    remedy available to the Securities and Exchange Commission or any
    private party arising under the Securities Act of 1933 [15 U.S.C.
    77a et seq.] or the Securities Exchange Act of 1934 [15 U.S.C. 78a
    et seq.] governing the issuance, offer, purchase, or sale of
    securities of a commodity pool, or of persons engaged in
    transactions with respect to such securities, or reporting by a
    commodity pool.
      (3) Subsection (1) of this section shall not apply to any
    commodity trading advisor that is registered with the Securities
    and Exchange Commission as an investment adviser whose business
    does not consist primarily of acting as a commodity trading
    advisor, as defined in section 1a(6) of this title, and that does
    not act as a commodity trading advisor to any investment trust,
    syndicate, or similar form of enterprise that is engaged primarily
    in trading in any commodity for future delivery on or subject to
    the rules of any contract market or registered derivatives
    transaction execution facility.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4m, as added Pub. L. 93-463, title
    II, Sec. 205(a), Oct. 23, 1974, 88 Stat. 1398; amended Pub. L. 95-
    405, Sec. 8, Sept. 30, 1978, 92 Stat. 870; Pub. L. 97-444, title
    I, Sec. 103, Jan. 11, 1983, 96 Stat. 2296; Pub. L. 106-554, Sec.
    1(a)(5) [title II, Sec. 251(d)], Dec. 21, 2000, 114 Stat. 2763,
    2763A-443.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Securities Act of 1933, referred to in par. (2), is title I
    of act May 27, 1933, ch. 38, 48 Stat. 74, as amended, which is
    classified generally to subchapter I (Sec. 77a et seq.) of chapter
    2A of Title 15, Commerce and Trade. For complete classification of
    this Act to the Code, see section 77a of Title 15 and Tables.
      The Securities Exchange Act of 1934, referred to in par. (2), is
    act June 6, 1934, ch. 404, 48 Stat. 881, as amended, which is
    classified principally to chapter 2B (Sec. 78a et seq.) of Title
    15. For complete classification of this Act to the Code, see
    section 78a of Title 15 and Tables.

-MISC1-
                                AMENDMENTS                            
      2000 - Par. (3). Pub. L. 106-554 added par. (3).
      1983 - Pub. L. 97-444 designated existing provisions as par. (1)
    and added par. (2).
      1978 - Pub. L. 95-405 inserted provisions relating to
    applicability of this section to commodity trading advisors who are
    dealers, processors, brokers, or sellers in cash market
    transactions of specifically listed commodities or nonprofit,
    voluntary membership, general farm organizations who provide advice
    on sale or purchase of specifically listed commodities if the
    advice by the person described in cl. (1) or (2) of this sentence
    is incidental solely to the conduct to the person's business and
    that such person be subject to proceedings under section 18 of this
    title.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 418 of Pub. L. 93-463,
    set out as an Effective Date of 1974 Amendment note under section 2
    of this title.

-End-

-CITE-
    7 USC Sec. 6n                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6n. Registration of commodity trading advisors and commodity
      pool operators; application; expiration and renewal; record
      keeping and reports; disclosure; statements of account

-STATUTE-
      (1) Any commodity trading advisor or commodity pool operator, or
    any person who contemplates becoming a commodity trading advisor or
    commodity pool operator, may register under this chapter by filing
    an application with the Commission. Such application shall contain
    such information, in such form and detail, as the Commission may,
    by rules and regulations, prescribe as necessary or appropriate in
    the public interest, including the following:
        (A) the name and form of organization, including capital
      structure, under which the applicant engages or intends to engage
      in business; the name of the State under the laws of which he is
      organized; the location of his principal business office and
      branch offices, if any; the names and addresses of all partners,
      officers, directors, and persons performing similar functions or,
      if the applicant be an individual, of such individual; and the
      number of employees;
        (B) the education, the business affiliations for the past ten
      years, and the present business affiliations of the applicant and
      of his partners, officers, directors, and persons performing
      similar functions and of any controlling person thereof;
        (C) the nature of the business of the applicant, including the
      manner of giving advice and rendering of analyses or reports;
        (D) the nature and scope of the authority of the applicant with
      respect to clients' funds and accounts;
        (E) the basis upon which the applicant is or will be
      compensated; and
        (F) such other information as the Commission may require to
      determine whether the applicant is qualified for registration.

      (2) Each registration under this section shall expire on the 30th
    day of June of each year, or at such other time, not less than one
    year from the effective date thereof, as the Commission may by
    rule, regulation, or order prescribe, and shall be renewed upon
    application therefor subject to the same requirements as in the
    case of an original application.
      (3)(A) Every commodity trading advisor and commodity pool
    operator registered under this chapter shall maintain books and
    records and file such reports in such form and manner as may be
    prescribed by the Commission. All such books and records shall be
    kept for a period of at least three years, or longer if the
    Commission so directs, and shall be open to inspection by any
    representative of the Commission or the Department of Justice. Upon
    the request of the Commission, a registered commodity trading
    advisor or commodity pool operator shall furnish the name and
    address of each client, subscriber, or participant, and submit
    samples or copies of all reports, letters, circulars, memorandums,
    publications, writings, or other literature or advice distributed
    to clients, subscribers, or participants, or prospective clients,
    subscribers, or participants.
      (B) Unless otherwise authorized by the Commission by rule or
    regulation, all commodity trading advisors and commodity pool
    operators shall make a full and complete disclosure to their
    subscribers, clients, or participants of all futures market
    positions taken or held by the individual principals of their
    organization.
      (4) Every commodity pool operator shall regularly furnish
    statements of account to each participant in his operations. Such
    statements shall be in such form and manner as may be prescribed by
    the Commission and shall include complete information as to the
    current status of all trading accounts in which such participant
    has an interest.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4n, as added Pub. L. 93-463, title
    II, Sec. 205(a), Oct. 23, 1974, 88 Stat. 1398; amended Pub. L. 95-
    405, Sec. 9, Sept. 30, 1978, 92 Stat. 870; Pub. L. 97-444, title
    II, Sec. 213, Jan. 11, 1983, 96 Stat. 2305.)

-MISC1-
                                AMENDMENTS                            
      1983 - Par. (5). Pub. L. 97-444 struck out par. (5) which
    authorized Commission, without hearing, to deny registration to any
    person as a commodity trading advisor or commodity pool operator if
    such person was subject to an outstanding order under this chapter
    denying to such person trading privileges on any contract market,
    or suspending or revoking the registration of such person as a
    commodity trading advisor, commodity pool operator, futures
    commission merchant, or floor broker, or suspending or expelling
    such person from membership on any contract market.
      Par. (6). Pub. L. 97-444 struck out par. (6) which authorized
    Commission to deny registration or revoke or suspend the
    registration of any commodity trading advisor or commodity pool
    operator if the Commission found that such denial, revocation, or
    suspension was in the public interest and that such person had been
    guilty of certain specified activities. See section 12a(2), (3),
    and (4) of this title.
      1978 - Par. (2). Pub. L. 95-405, Sec. 9(1)-(3), redesignated par.
    (3) as (2) and substituted "Each registration" for "All
    registrations" and inserted "or at such other time, not less than
    one year from the effective date thereof, as the Commission may
    rule, regulation, or order prescribe," after "June of each year,".
    Former par. (2), which provided that registration under this
    section becomes effective thirty days after the receipt of such
    application by the Commission, or within such shorter period of
    time as the Commission may determine, was struck out.
      Pars. (3) to (6). Pub. L. 95-405, Sec. 9(1), redesignated pars.
    (4) to (7) as (3) to (6), respectively. Former par. (3)
    redesignated (2).

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 418 of Pub. L. 93-463,
    set out as an Effective Date of 1974 Amendment note under section 2
    of this title.

-End-

-CITE-
    7 USC Sec. 6o                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6o. Fraud and misrepresentation by commodity trading advisors,
      commodity pool operators, and associated persons

-STATUTE-
      (1) It shall be unlawful for a commodity trading advisor,
    associated person of a commodity trading advisor, commodity pool
    operator, or associated person of a commodity pool operator, by use
    of the mails or any means or instrumentality of interstate
    commerce, directly or indirectly - 
        (A) to employ any device, scheme, or artifice to defraud any
      client or participant or prospective client or participant; or
        (B) to engage in any transaction, practice, or course of
      business which operates as a fraud or deceit upon any client or
      participant or prospective client or participant.

      (2) It shall be unlawful for any commodity trading advisor,
    associated person of a commodity trading advisor, commodity pool
    operator, or associated person of a commodity pool operator
    registered under this chapter to represent or imply in any manner
    whatsoever that such person has been sponsored, recommended, or
    approved, or that such person's abilities or qualifications have in
    any respect been passed upon, by the United States or any agency or
    officer thereof. This section shall not be construed to prohibit a
    statement that a person is registered under this chapter as a
    commodity trading advisor, associated person of a commodity trading
    advisor, commodity pool operator, or associated person of a
    commodity pool operator, if such statement is true in fact and if
    the effect of such registration is not misrepresented.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4o, as added Pub. L. 93-463, title
    II, Sec. 205(a), Oct. 23, 1974, 88 Stat. 1399; amended Pub. L. 95-
    405, Sec. 10, Sept. 30, 1978, 92 Stat. 870; Pub. L. 97-444, title
    II, Sec. 214, Jan. 11, 1983, 96 Stat. 2305.)

-MISC1-
                                AMENDMENTS                            
      1983 - Par. (1). Pub. L. 97-444 made the antifraud prohibition
    applicable to an associated person of a commodity trading advisor
    or a commodity pool operator.
      Par. (2). Pub. L. 97-444 made the misrepresentation prohibition
    applicable to an associated person of a commodity training advisor
    or a commodity pool operator, authorized registration statements of
    such persons, and substituted "such person" and "such person's
    abilities" for "he" before "has been sponsored" and "his
    abilities", respectively.
      1978 - Par. (1). Pub. L. 95-405 struck out "registered under this
    chapter" after "pool operator".

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 418 of Pub. L. 93-463,
    set out as an Effective Date of 1974 Amendment note under section 2
    of this title.

-End-

-CITE-
    7 USC Sec. 6o-1                                             01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6o-1. Special procedures to encourage and facilitate bona fide
      hedging by agricultural producers

-STATUTE-
    (a) Authority
      The Commission shall consider issuing rules or orders which - 
        (1) prescribe procedures under which each contract market is to
      provide for orderly delivery, including temporary storage costs,
      of any agricultural commodity enumerated in section 1a(4) of this
      title which is the subject of a contract for purchase or sale for
      future delivery;
        (2) increase the ease with which domestic agricultural
      producers may participate in contract markets, including by
      addressing cost and margin requirements, so as to better enable
      the producers to hedge price risk associated with their
      production;
        (3) provide flexibility in the minimum quantities of such
      agricultural commodities that may be the subject of a contract
      for purchase or sale for future delivery that is traded on a
      contract market, to better allow domestic agricultural producers
      to hedge such price risk; and
        (4) encourage contract markets to provide information and
      otherwise facilitate the participation of domestic agricultural
      producers in contract markets.
    (b) Report
      Within 1 year after December 21, 2000, the Commission shall
    submit to the Committee on Agriculture of the House of
    Representatives and the Committee on Agriculture, Nutrition, and
    Forestry of the Senate a report on the steps it has taken to
    implement this section and on the activities of contract markets
    pursuant to this section.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4p, as added Pub. L. 106-554, Sec.
    1(a)(5) [title I, Sec. 121], Dec. 21, 2000, 114 Stat. 2763, 2763A-
    404.)

-COD-
                               CODIFICATION                           
      Another section 4p of act Sept. 21, 1922, is classified to
    section 6p of this title.

-End-

-CITE-
    7 USC Sec. 6p                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 6p. Standards and examinations

-STATUTE-
      (a) The Commission may specify by rules and regulations
    appropriate standards with respect to training, experience, and
    such other qualifications as the Commission finds necessary or
    desirable to insure the fitness of persons required to be
    registered with the Commission. In connection therewith, the
    Commission may prescribe by rules and regulations the adoption of
    written proficiency examinations to be given to applicants for
    registration and the establishment of reasonable fees to be charged
    to such applicants to cover the administration of such
    examinations. The Commission may further prescribe by rules and
    regulations that, in lieu of examinations administered by the
    Commission, futures associations registered under section 21 of
    this title, contract markets, or derivatives transaction execution
    facilities may adopt written proficiency examinations to be given
    to applicants for registration and charge reasonable fees to such
    applicants to cover the administration of such examinations.
    Notwithstanding any other provision of this section, the Commission
    may specify by rules and regulations such terms and conditions as
    it deems appropriate to protect the public interest wherein
    exception to any written proficiency examination shall be made with
    respect to individuals who have demonstrated, through training and
    experience, the degree of proficiency and skill necessary to
    protect the interests of customers, clients, pool participants, or
    other members of the public with whom such individuals deal.
      (b) The Commission shall issue regulations to require new
    registrants, within six months after receiving such registration,
    to attend a training session, and all other registrants to attend
    periodic training sessions, to ensure that registrants understand
    their responsibilities to the public under this chapter, including
    responsibilities to observe just and equitable principles of trade,
    any rule or regulation of the Commission, any rule of any
    appropriate contract market, derivatives transaction execution
    facility, registered futures association, or other self-regulatory
    organization, or any other applicable Federal or state (!1) law,
    rule or regulation.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 4p, as added Pub. L. 93-463, title
    II, Sec. 206, Oct. 23, 1974, 88 Stat. 1400; amended Pub. L. 97-444,
    title II, Sec. 215, Jan. 11, 1983, 96 Stat. 2305; Pub. L. 102-546,
    title II, Sec. 210(a), Oct. 28, 1992, 106 Stat. 3607; Pub. L. 106-
    554, Sec. 1(a)(5) [title I, Sec. 123(a)(11)], Dec. 21, 2000, 114
    Stat. 2763, 2763A-408.)

-COD-
                               CODIFICATION                           
      Another section 4p of act Sept. 21, 1922, is classified to
    section 6o-1 of this title.

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (a). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(11)(A)], substituted "title, contract markets, or
    derivatives transaction execution facilities" for "title or
    contract markets".
      Subsec. (b). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(11)(B)], inserted "derivatives transaction execution
    facility," after "contract market,".
      1992 - Pub. L. 102-546 designated existing provisions as subsec.
    (a) and added subsec. (b).
      1983 - Pub. L. 97-444 substituted "persons required to be
    registered with the Commission" for "futures commission merchants,
    floor brokers, and those persons associated with futures commission
    merchants or floor brokers" in first sentence, "customers, clients,
    pool participants, or other members of the public with whom such
    individuals deal" for "the customers of futures commission
    merchants and floor brokers" in last sentence, and in second and
    third sentences struck out "as futures commission merchants, floor
    brokers, and those persons associated with futures commission
    merchants or floor brokers," after "applicants for registration".

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 418 of Pub. L. 93-463,
    set out as an Effective Date of 1974 Amendment note under section 2
    of this title.

                                REGULATIONS                            
      Section 210(b) of Pub. L. 102-546 provided that: "The Commodity
    Futures Trading Commission shall issue the regulations required by
    section 4p(b) of the Commodity Exchange Act [7 U.S.C. 6p(b)], as
    added by subsection (a), no later than one hundred and eighty days
    after the date of enactment of this Act [Oct. 28, 1992]."

-FOOTNOTE-
    (!1) So in original. Probably should be capitalized.

-End-

-CITE-
    7 USC Sec. 7                                                01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 7. Designation of boards of trade as contract markets

-STATUTE-
    (a) Applications
      A board of trade applying to the Commission for designation as a
    contract market shall submit an application to the Commission that
    includes any relevant materials and records the Commission may
    require consistent with this chapter.
    (b) Criteria for designation
      (1) In general
        To be designated as a contract market, the board of trade shall
      demonstrate to the Commission that the board of trade meets the
      criteria specified in this subsection.
      (2) Prevention of market manipulation
        The board of trade shall have the capacity to prevent market
      manipulation through market surveillance, compliance, and
      enforcement practices and procedures, including methods for
      conducting real-time monitoring of trading and comprehensive and
      accurate trade reconstructions.
      (3) Fair and equitable trading
        The board of trade shall establish and enforce trading rules to
      ensure fair and equitable trading through the facilities of the
      contract market, and the capacity to detect, investigate, and
      discipline any person that violates the rules. The rules may
      authorize - 
          (A) transfer trades or office trades;
          (B) an exchange of - 
            (i) futures in connection with a cash commodity
          transaction;
            (ii) futures for cash commodities; or
            (iii) futures for swaps; or

          (C) a futures commission merchant, acting as principal or
        agent, to enter into or confirm the execution of a contract for
        the purchase or sale of a commodity for future delivery if the
        contract is reported, recorded, or cleared in accordance with
        the rules of the contract market or a derivatives clearing
        organization.
      (4) Trade execution facility
        The board of trade shall - 
          (A) establish and enforce rules defining, or specifications
        detailing, the manner of operation of the trade execution
        facility maintained by the board of trade, including rules or
        specifications describing the operation of any electronic
        matching platform; and
          (B) demonstrate that the trade execution facility operates in
        accordance with the rules or specifications.
      (5) Financial integrity of transactions
        The board of trade shall establish and enforce rules and
      procedures for ensuring the financial integrity of transactions
      entered into by or through the facilities of the contract market,
      including the clearance and settlement of the transactions with a
      derivatives clearing organization.
      (6) Disciplinary procedures
        The board of trade shall establish and enforce disciplinary
      procedures that authorize the board of trade to discipline,
      suspend, or expel members or market participants that violate the
      rules of the board of trade, or similar methods for performing
      the same functions, including delegation of the functions to
      third parties.
      (7) Public access
        The board of trade shall provide the public with access to the
      rules, regulations, and contract specifications of the board of
      trade.
      (8) Ability to obtain information
        The board of trade shall establish and enforce rules that will
      allow the board of trade to obtain any necessary information to
      perform any of the functions described in this subsection,
      including the capacity to carry out such international
      information-sharing agreements as the Commission may require.
    (c) Existing contract markets
      A board of trade that is designated as a contract market on
    December 21, 2000, shall be considered to be a designated contract
    market under this section.
    (d) Core principles for contract markets
      (1) In general
        To maintain the designation of a board of trade as a contract
      market, the board of trade shall comply with the core principles
      specified in this subsection. The board of trade shall have
      reasonable discretion in establishing the manner in which it
      complies with the core principles.
      (2) Compliance with rules
        The board of trade shall monitor and enforce compliance with
      the rules of the contract market, including the terms and
      conditions of any contracts to be traded and any limitations on
      access to the contract market.
      (3) Contracts not readily subject to manipulation
        The board of trade shall list on the contract market only
      contracts that are not readily susceptible to manipulation.
      (4) Monitoring of trading
        The board of trade shall monitor trading to prevent
      manipulation, price distortion, and disruptions of the delivery
      or cash-settlement process.
      (5) Position limitations or accountability
        To reduce the potential threat of market manipulation or
      congestion, especially during trading in the delivery month, the
      board of trade shall adopt position limitations or position
      accountability for speculators, where necessary and appropriate.
      (6) Emergency authority
        The board of trade shall adopt rules to provide for the
      exercise of emergency authority, in consultation or cooperation
      with the Commission, where necessary and appropriate, including
      the authority to - 
          (A) liquidate or transfer open positions in any contract;
          (B) suspend or curtail trading in any contract; and
          (C) require market participants in any contract to meet
        special margin requirements.
      (7) Availability of general information
        The board of trade shall make available to market authorities,
      market participants, and the public information concerning - 
          (A) the terms and conditions of the contracts of the contract
        market; and
          (B) the mechanisms for executing transactions on or through
        the facilities of the contract market.
      (8) Daily publication of trading information
        The board of trade shall make public daily information on
      settlement prices, volume, open interest, and opening and closing
      ranges for actively traded contracts on the contract market.
      (9) Execution of transactions
        The board of trade shall provide a competitive, open, and
      efficient market and mechanism for executing transactions.
      (10) Trade information
        The board of trade shall maintain rules and procedures to
      provide for the recording and safe storage of all identifying
      trade information in a manner that enables the contract market to
      use the information for purposes of assisting in the prevention
      of customer and market abuses and providing evidence of any
      violations of the rules of the contract market.
      (11) Financial integrity of contracts
        The board of trade shall establish and enforce rules providing
      for the financial integrity of any contracts traded on the
      contract market (including the clearance and settlement of the
      transactions with a derivatives clearing organization), and rules
      to ensure the financial integrity of any futures commission
      merchants and introducing brokers and the protection of customer
      funds.
      (12) Protection of market participants
        The board of trade shall establish and enforce rules to protect
      market participants from abusive practices committed by any party
      acting as an agent for the participants.
      (13) Dispute resolution
        The board of trade shall establish and enforce rules regarding
      and provide facilities for alternative dispute resolution as
      appropriate for market participants and any market
      intermediaries.
      (14) Governance fitness standards
        The board of trade shall establish and enforce appropriate
      fitness standards for directors, members of any disciplinary
      committee, members of the contract market, and any other persons
      with direct access to the facility (including any parties
      affiliated with any of the persons described in this paragraph).
      (15) Conflicts of interest
        The board of trade shall establish and enforce rules to
      minimize conflicts of interest in the decisionmaking process of
      the contract market and establish a process for resolving such
      conflicts of interest.
      (16) Composition of boards of mutually owned contract markets
        In the case of a mutually owned contract market, the board of
      trade shall ensure that the composition of the governing board
      reflects market participants.
      (17) Recordkeeping
        The board of trade shall maintain records of all activities
      related to the business of the contract market in a form and
      manner acceptable to the Commission for a period of 5 years.
      (18) Antitrust considerations
        Unless necessary or appropriate to achieve the purposes of this
      chapter, the board of trade shall endeavor to avoid - 
          (A) adopting any rules or taking any actions that result in
        any unreasonable restraints of trade; or
          (B) imposing any material anticompetitive burden on trading
        on the contract market.
    (e) Current agricultural commodities
      (1) Subject to paragraph (2) of this subsection, a contract for
    purchase or sale for future delivery of an agricultural commodity
    enumerated in section 1a(4) of this title that is available for
    trade on a contract market, as of December 21, 2000, may be traded
    only on a contract market designated under this section.
      (2) In order to promote responsible economic or financial
    innovation and fair competition, the Commission, on application by
    any person, after notice and public comment and opportunity for
    hearing, may prescribe rules and regulations to provide for the
    offer and sale of contracts for future delivery or options on such
    contracts to be conducted on a derivatives transaction execution
    facility.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 5, as added Pub. L. 106-554, Sec.
    1(a)(5) [title I, Sec. 110(2)], Dec. 21, 2000, 114 Stat. 2763,
    2763A-384.)

-MISC1-
                             PRIOR PROVISIONS                         
      A prior section 7, acts Sept. 21, 1922, ch. 369, Sec. 5, 42 Stat.
    1000; June 15, 1936, ch. 545, Secs. 2, 6, 49 Stat. 1491, 1497; Pub.
    L. 90-258, Secs. 10, 11, Feb. 19, 1968, 82 Stat. 29; Pub. L. 93-
    463, title I, Sec. 103(a), (f), (g), title II, Sec. 207, Oct. 23,
    1974, 88 Stat. 1392, 1400; Pub. L. 102-546, title II, Secs. 201(c),
    209(b)(2), Oct. 28, 1992, 106 Stat. 3597, 3606, related to
    conditions and requirements for designation of boards of trade as
    contract markets, prior to repeal by Pub. L. 106-554, Sec. 1(a)(5)
    [title I, Sec. 110(2)], Dec. 21, 2000, 114 Stat. 2763, 2763A-384.

-End-

-CITE-
    7 USC Sec. 7a                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 7a. Derivatives transaction execution facilities

-STATUTE-
    (a) In general
      In lieu of compliance with the contract market designation
    requirements of sections 6(a) and 7 of this title, a board of trade
    may elect to operate as a registered derivatives transaction
    execution facility if the facility is - 
        (1) designated as a contract market and meets the requirements
      of this section; or
        (2) registered as a derivatives transaction execution facility
      under subsection (c) of this section.
    (b) Requirements for trading
      (1) In general
        A registered derivatives transaction execution facility under
      subsection (a) of this section may trade any contract of sale of
      a commodity for future delivery (or option on such a contract) on
      or through the facility only by satisfying the requirements of
      this section.
      (2) Requirements for underlying commodities
        A registered derivatives transaction execution facility may
      trade any contract of sale of a commodity for future delivery (or
      option on such a contract) only if - 
          (A) the underlying commodity has a nearly inexhaustible
        deliverable supply;
          (B) the underlying commodity has a deliverable supply that is
        sufficiently large that the contract is highly unlikely to be
        susceptible to the threat of manipulation;
          (C) the underlying commodity has no cash market;
          (D)(i) the contract is a security futures product, and (ii)
        the registered derivatives transaction execution facility is a
        national securities exchange registered under the Securities
        Exchange Act of 1934 [15 U.S.C. 78a et seq.];
          (E) the Commission determines, based on the market
        characteristics, surveillance history, self-regulatory record,
        and capacity of the facility that trading in the contract (or
        option) is highly unlikely to be susceptible to the threat of
        manipulation; or
          (F) except as provided in section 7(e)(2) of this title, the
        underlying commodity is a commodity other than an agricultural
        commodity enumerated in section 1a(4) of this title, and
        trading access to the facility is limited to eligible
        commercial entities trading for their own account.
      (3) Eligible traders
        To trade on a registered derivatives transaction execution
      facility, a person shall - 
          (A) be an eligible contract participant; or
          (B) be a person trading through a futures commission merchant
        that - 
            (i) is registered with the Commission;
            (ii) is a member of a futures self-regulatory organization
          or, if the person trades only security futures products on
          the facility, a national securities association registered
          under section 15A(a) of the Securities Exchange Act of 1934
          [15 U.S.C. 78o-3(a)];
            (iii) is a clearing member of a derivatives clearing
          organization; and
            (iv) has net capital of at least $20,000,000.
      (4) Trading by contract markets
        A board of trade that is designated as a contract market shall,
      to the extent that the contract market also operates a registered
      derivatives transaction execution facility - 
          (A) provide a physical location for the contract market
        trading of the board of trade that is separate from trading on
        the derivatives transaction execution facility of the board of
        trade; or
          (B) if the board of trade uses the same electronic trading
        system for trading on the contract market and derivatives
        transaction execution facility of the board of trade, identify
        whether the electronic trading is taking place on the contract
        market or the derivatives transaction execution facility.
    (c) Criteria for registration
      (1) In general
        To be registered as a registered derivatives transaction
      execution facility, the board of trade shall be required to
      demonstrate to the Commission only that the board of trade meets
      the criteria specified in subsection (b) of this section and this
      subsection.
      (2) Deterrence of abuses
        The board of trade shall establish and enforce trading and
      participation rules that will deter abuses and has the capacity
      to detect, investigate, and enforce those rules, including means
      to - 
          (A) obtain information necessary to perform the functions
        required under this section; or
          (B) use technological means to - 
            (i) provide market participants with impartial access to
          the market; and
            (ii) capture information that may be used in establishing
          whether rule violations have occurred.
      (3) Trading procedures
        The board of trade shall establish and enforce rules or terms
      and conditions defining, or specifications detailing, trading
      procedures to be used in entering and executing orders traded on
      the facilities of the board of trade. The rules may authorize - 
          (A) transfer trades or office trades;
          (B) an exchange of - 
            (i) futures in connection with a cash commodity
          transaction;
            (ii) futures for cash commodities; or
            (iii) futures for swaps; or

          (C) a futures commission merchant, acting as principal or
        agent, to enter into or confirm the execution of a contract for
        the purchase or sale of a commodity for future delivery if the
        contract is reported, recorded, or cleared in accordance with
        the rules of the registered derivatives transaction execution
        facility or a derivatives clearing organization.
      (4) Financial integrity of transactions
        The board of trade shall establish and enforce rules or terms
      and conditions providing for the financial integrity of
      transactions entered on or through the facilities of the board of
      trade, and rules or terms and conditions to ensure the financial
      integrity of any futures commission merchants and introducing
      brokers and the protection of customer funds.
    (d) Core principles for registered derivatives transaction
      execution facilities
      (1) In general
        To maintain the registration of a board of trade as a
      derivatives transaction execution facility, a board of trade
      shall comply with the core principles specified in this
      subsection. The board of trade shall have reasonable discretion
      in establishing the manner in which the board of trade complies
      with the core principles.
      (2) Compliance with rules
        The board of trade shall monitor and enforce the rules of the
      facility, including any terms and conditions of any contracts
      traded on or through the facility and any limitations on access
      to the facility.
      (3) Monitoring of trading
        The board of trade shall monitor trading in the contracts of
      the facility to ensure orderly trading in the contract and to
      maintain an orderly market while providing any necessary trading
      information to the Commission to allow the Commission to
      discharge the responsibilities of the Commission under the (!1)
      chapter.

      (4) Disclosure of general information
        The board of trade shall disclose publicly and to the
      Commission information concerning - 
          (A) contract terms and conditions;
          (B) trading conventions, mechanisms, and practices;
          (C) financial integrity protections; and
          (D) other information relevant to participation in trading on
        the facility.
      (5) Daily publication of trading information
        The board of trade shall make public daily information on
      settlement prices, volume, open interest, and opening and closing
      ranges for contracts traded on the facility if the Commission
      determines that the contracts perform a significant price
      discovery function for transactions in the cash market for the
      commodity underlying the contracts.
      (6) Fitness standards
        The board of trade shall establish and enforce appropriate
      fitness standards for directors, members of any disciplinary
      committee, members, and any other persons with direct access to
      the facility, including any parties affiliated with any of the
      persons described in this paragraph.
      (7) Conflicts of interest
        The board of trade shall establish and enforce rules to
      minimize conflicts of interest in the decision making process of
      the derivatives transaction execution facility and establish a
      process for resolving such conflicts of interest.
      (8) Recordkeeping
        The board of trade shall maintain records of all activities
      related to the business of the derivatives transaction execution
      facility in a form and manner acceptable to the Commission for a
      period of 5 years.
      (9) Antitrust considerations
        Unless necessary or appropriate to achieve the purposes of this
      chapter, the board of trade shall endeavor to avoid - 
          (A) adopting any rules or taking any actions that result in
        any unreasonable restraint of trade; or
          (B) imposing any material anticompetitive burden on trading
        on the derivatives transaction execution facility.
    (e) Use of broker-dealers, depository institutions, and farm credit
      system institutions as intermediaries
      (1) In general
        With respect to transactions other than transactions in
      security futures products, a registered derivatives transaction
      execution facility may by rule allow a broker-dealer, depository
      institution, or institution of the Farm Credit System that meets
      the requirements of paragraph (2) to - 
          (A) act as an intermediary in transactions executed on the
        facility on behalf of customers of the broker-dealer,
        depository institution, or institution of the Farm Credit
        System; and
          (B) receive funds of customers to serve as margin or security
        for the transactions.
      (2) Requirements
        The requirements referred to in paragraph (1) are that - 
          (A) the broker-dealer be in good standing with the Securities
        and Exchange Commission, or the depository institution or
        institution of the Farm Credit System be in good standing with
        Federal bank regulatory agencies (including the Farm Credit
        Administration), as applicable; and
          (B) if the broker-dealer, depository institution, or
        institution of the Farm Credit System carries or holds customer
        accounts or funds for transactions on the derivatives
        transaction execution facility for more than 1 business day,
        the broker-dealer, depository institution, or institution of
        the Farm Credit System is registered as a futures commission
        merchant and is a member of a registered futures association.
      (3) Implementation
        The Commission shall cooperate and coordinate with the
      Securities and Exchange Commission, the Secretary of the
      Treasury, and Federal banking regulatory agencies (including the
      Farm Credit Administration) in adopting rules and taking any
      other appropriate action to facilitate the implementation of this
      subsection.
    (f) Segregation of customer funds
      Not later than 180 days after December 21, 2000, consistent with
    regulations adopted by the Commission, a registered derivatives
    transaction execution facility may authorize a futures commission
    merchant to offer any customer of the futures commission merchant
    that is an eligible contract participant the right to not segregate
    the customer funds of the customer that are carried with the
    futures commission merchant for purposes of trading on or through
    the facilities of the registered derivatives transaction execution
    facility.
    (g) Election to trade excluded and exempt commodities
      (1) In general
        Notwithstanding subsection (b)(2) of this section, a board of
      trade that is or elects to become a registered derivatives
      transaction execution facility may trade on the facility any
      agreements, contracts, or transactions involving excluded or
      exempt commodities other than securities, except contracts of
      sale for future delivery of exempt securities under section
      3(a)(12) of the Securities Exchange Act of 1934 [15 U.S.C.
      78c(a)(12)] as in effect on January 11, 1983, that are otherwise
      excluded from this chapter under section 2(c), 2(d), or 2(g) of
      this title, or exempt under section 2(h) of this title.
      (2) Exclusive jurisdiction of the Commission
        The Commission shall have exclusive jurisdiction over
      agreements, contracts, or transactions described in paragraph (1)
      to the extent that the agreements, contracts, or transactions are
      traded on a derivatives transaction execution facility.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 5a, as added Pub. L. 106-554, Sec.
    1(a)(5) [title I, Sec. 111], Dec. 21, 2000, 114 Stat. 2763, 2763A-
    387.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Securities Exchange Act of 1934, referred to in subsec.
    (b)(2)(D)(ii), is act June 6, 1934, ch. 404, 48 Stat. 881, as
    amended, which is classified principally to chapter 2B (Sec. 78a et
    seq.) of Title 15, Commerce and Trade. For complete classification
    of this Act to the Code, see section 78a of Title 15 and Tables.

-MISC1-
                             PRIOR PROVISIONS                         
      A prior section 7a, act Sept. 21, 1922, ch. 369, Sec. 5a, as
    added June 15, 1936, ch. 545, Sec. 7, 49 Stat. 1497; amended Pub.
    L. 90-258, Sec. 12, Feb. 19, 1968, 82 Stat. 29; Pub. L. 93-463,
    title I, Sec. 103(a), (e), (f), title II, Secs. 208-210, title IV,
    Secs. 406, 407, Oct. 23, 1974, 88 Stat. 1392, 1400, 1401, 1413;
    Pub. L. 95-405, Secs. 11, 12, Sept. 30, 1978, 92 Stat. 870, 871;
    Pub. L. 97-444, title II, Secs. 216, 217(a), Jan. 11, 1983, 96
    Stat. 2306, 2307; Pub. L. 99-641, title I, Sec. 110(2), Nov. 10,
    1986, 100 Stat. 3561; Pub. L. 102-546, title I, Sec. 103, title II,
    Secs. 201(a), 206(a)(1), 213(a), 217, 222(a), Oct. 28, 1992, 106
    Stat. 3594, 3595, 3601, 3609, 3611, 3615, related to duties of
    contract markets prior to repeal by Pub. L. 106-554, Sec. 1(a)(5)
    [title I, Sec. 110(2)], Dec. 21, 2000, 114 Stat. 2763, 2763A-384.

-FOOTNOTE-
    (!1) So in original. Probably should be "this".

-End-

-CITE-
    7 USC Sec. 7a-1                                             01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 7a-1. Derivatives clearing organizations

-STATUTE-
    (a) Registration requirement
      It shall be unlawful for a derivatives clearing organization,
    unless registered with the Commission, directly or indirectly to
    make use of the mails or any means or instrumentality of interstate
    commerce to perform the functions of a derivatives clearing
    organization described in section 1a(9) of this title with respect
    to a contract of sale of a commodity for future delivery (or option
    on such a contract) or option on a commodity, in each case unless
    the contract or option - 
        (1) is excluded from this chapter by section 2(a)(1)(C)(i),
      2(c), 2(d), 2(f), or 2(g) of this title or sections 27 to 27f of
      this title, or exempted under section 2(h) or 6(c) of this title;
      or
        (2) is a security futures product cleared by a clearing agency
      registered under the Securities Exchange Act of 1934 [15 U.S.C.
      78a et seq.].
    (b) Voluntary registration
      A derivatives clearing organization that clears agreements,
    contracts, or transactions excluded from this chapter by section
    2(c), 2(d), 2(f), or 2(g) of this title or sections 27 to 27f of
    this title, or exempted under section 2(h) or 6(c) of this title,
    or other over-the-counter derivative instruments (as defined in the
    Federal Deposit Insurance Corporation Improvement Act of 1991) may
    register with the Commission as a derivatives clearing
    organization.
    (c) Registration of derivatives clearing organizations
      (1) Application
        A person desiring to register as a derivatives clearing
      organization shall submit to the Commission an application in
      such form and containing such information as the Commission may
      require for the purpose of making the determinations required for
      approval under paragraph (2).
      (2) Core principles
        (A) In general
          To be registered and to maintain registration as a
        derivatives clearing organization, an applicant shall
        demonstrate to the Commission that the applicant complies with
        the core principles specified in this paragraph. The applicant
        shall have reasonable discretion in establishing the manner in
        which it complies with the core principles.
        (B) Financial resources
          The applicant shall demonstrate that the applicant has
        adequate financial, operational, and managerial resources to
        discharge the responsibilities of a derivatives clearing
        organization.
        (C) Participant and product eligibility
          The applicant shall establish - 
            (i) appropriate admission and continuing eligibility
          standards (including appropriate minimum financial
          requirements) for members of and participants in the
          organization; and
            (ii) appropriate standards for determining eligibility of
          agreements, contracts, or transactions submitted to the
          applicant.
        (D) Risk management
          The applicant shall have the ability to manage the risks
        associated with discharging the responsibilities of a
        derivatives clearing organization through the use of
        appropriate tools and procedures.
        (E) Settlement procedures
          The applicant shall have the ability to - 
            (i) complete settlements on a timely basis under varying
          circumstances;
            (ii) maintain an adequate record of the flow of funds
          associated with each transaction that the applicant clears;
          and
            (iii) comply with the terms and conditions of any permitted
          netting or offset arrangements with other clearing
          organizations.
        (F) Treatment of funds
          The applicant shall have standards and procedures designed to
        protect and ensure the safety of member and participant funds.
        (G) Default rules and procedures
          The applicant shall have rules and procedures designed to
        allow for efficient, fair, and safe management of events when
        members or participants become insolvent or otherwise default
        on their obligations to the derivatives clearing organization.
        (H) Rule enforcement
          The applicant shall - 
            (i) maintain adequate arrangements and resources for the
          effective monitoring and enforcement of compliance with rules
          of the applicant and for resolution of disputes; and
            (ii) have the authority and ability to discipline, limit,
          suspend, or terminate a member's or participant's activities
          for violations of rules of the applicant.
        (I) System safeguards
          The applicant shall demonstrate that the applicant - 
            (i) has established and will maintain a program of
          oversight and risk analysis to ensure that the automated
          systems of the applicant function properly and have adequate
          capacity and security; and
            (ii) has established and will maintain emergency procedures
          and a plan for disaster recovery, and will periodically test
          backup facilities sufficient to ensure daily processing,
          clearing, and settlement of transactions.
        (J) Reporting
          The applicant shall provide to the Commission all information
        necessary for the Commission to conduct the oversight function
        of the applicant with respect to the activities of the
        derivatives clearing organization.
        (K) Recordkeeping
          The applicant shall maintain records of all activities
        related to the business of the applicant as a derivatives
        clearing organization in a form and manner acceptable to the
        Commission for a period of 5 years.
        (L) Public information
          The applicant shall make information concerning the rules and
        operating procedures governing the clearing and settlement
        systems (including default procedures) available to market
        participants.
        (M) Information-sharing
          The applicant shall - 
            (i) enter into and abide by the terms of all appropriate
          and applicable domestic and international information-sharing
          agreements; and
            (ii) use relevant information obtained from the agreements
          in carrying out the clearing organization's risk management
          program.
        (N) Antitrust considerations
          Unless appropriate to achieve the purposes of this chapter,
        the derivatives clearing organization shall avoid - 
            (i) adopting any rule or taking any action that results in
          any unreasonable restraint of trade; or
            (ii) imposing any material anticompetitive burden on
          trading on the contract market.
      (3) Orders concerning competition
        A derivatives clearing organization may request the Commission
      to issue an order concerning whether a rule or practice of the
      applicant is the least anticompetitive means of achieving the
      objectives, purposes, and policies of this chapter.
    (d) Existing derivatives clearing organizations
      A derivatives clearing organization shall be deemed to be
    registered under this section to the extent that the derivatives
    clearing organization clears agreements, contracts, or transactions
    for a board of trade that has been designated by the Commission as
    a contract market for such agreements, contracts, or transactions
    before December 21, 2000.
    (e) Appointment of trustee
      (1) In general
        If a proceeding under section 7b of this title results in the
      suspension or revocation of the registration of a derivatives
      clearing organization, or if a derivatives clearing organization
      withdraws from registration, the Commission, on notice to the
      derivatives clearing organization, may apply to the appropriate
      United States district court where the derivatives clearing
      organization is located for the appointment of a trustee.
      (2) Assumption of jurisdiction
        If the Commission applies for appointment of a trustee under
      paragraph (1) - 
          (A) the court may take exclusive jurisdiction over the
        derivatives clearing organization and the records and assets of
        the derivatives clearing organization, wherever located; and
          (B) if the court takes jurisdiction under subparagraph (A),
        the court shall appoint the Commission, or a person designated
        by the Commission, as trustee with power to take possession and
        continue to operate or terminate the operations of the
        derivatives clearing organization in an orderly manner for the
        protection of participants, subject to such terms and
        conditions as the court may prescribe.
    (f) Linking of regulated clearing facilities
      (1) In general
        The Commission shall facilitate the linking or coordination of
      derivatives clearing organizations registered under this chapter
      with other regulated clearance facilities for the coordinated
      settlement of cleared transactions.
      (2) Coordination
        In carrying out paragraph (1), the Commission shall coordinate
      with the Federal banking agencies and the Securities and Exchange
      Commission.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 5b, as added Pub. L. 106-554, Sec.
    1(a)(5) [title I, Sec. 112(f)], Dec. 21, 2000, 114 Stat. 2763,
    2763A-396.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Securities Exchange Act of 1934, referred to in subsec.
    (a)(2), is act June 6, 1934, ch. 404, 48 Stat. 881, as amended,
    which is classified principally to chapter 2B (Sec. 78a et seq.) of
    Title 15, Commerce and Trade. For complete classification of this
    Act to the Code, see section 78a of Title 15 and Tables.
      The Federal Deposit Insurance Corporation Improvement Act of
    1991, referred to in subsec. (b), is Pub. L. 102-242, Dec. 19,
    1991, 105 Stat. 2236, as amended. For definition of over-the-
    counter derivative instrument, see section 4421 of Title 12, Banks
    and Banking. For complete classification of this Act to the Code,
    see Short Title of 1991 Amendment note set out under section 1811
    of Title 12 and Tables.

-MISC1-
                             PRIOR PROVISIONS                         
      A prior section 5b of act Sept. 21, 1922, was renumbered section
    5e, and is classified to section 7b of this title.

-End-

-CITE-
    7 USC Sec. 7a-2                                             01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 7a-2. Common provisions applicable to registered entities

-STATUTE-
    (a) Acceptable business practices under core principles
      (1) In general
        Consistent with the purposes of this chapter, the Commission
      may issue interpretations, or approve interpretations submitted
      to the Commission, of sections 7(d), 7a(d), and 7a-1(d)(2) (!1)
      of this title to describe what would constitute an acceptable
      business practice under such sections.

      (2) Effect of interpretation
        An interpretation issued under paragraph (1) shall not provide
      the exclusive means for complying with such sections.
    (b) Delegation of functions under core principles
      (1) In general
        A contract market or derivatives transaction execution facility
      may comply with any applicable core principle through delegation
      of any relevant function to a registered futures association or
      another registered entity.
      (2) Responsibility
        A contract market or derivatives transaction execution facility
      that delegates a function under paragraph (1) shall remain
      responsible for carrying out the function.
      (3) Noncompliance
        If a contract market or derivatives transaction execution
      facility that delegates a function under paragraph (1) becomes
      aware that a delegated function is not being performed as
      required under this chapter, the contract market or derivatives
      transaction execution facility shall promptly take steps to
      address the noncompliance.
    (c) New contracts, new rules, and rule amendments
      (1) In general
        Subject to paragraph (2), a registered entity may elect to list
      for trading or accept for clearing any new contract or other
      instrument, or may elect to approve and implement any new rule or
      rule amendment, by providing to the Commission (and the Secretary
      of the Treasury, in the case of a contract of sale of a
      government security for future delivery (or option on such a
      contract) or a rule or rule amendment specifically related to
      such a contract) a written certification that the new contract or
      instrument or clearing of the new contract or instrument, new
      rule, or rule amendment complies with this chapter (including
      regulations under this chapter).
      (2) Prior approval
        (A) In general
          A registered entity may request that the Commission grant
        prior approval to any new contract or other instrument, new
        rule, or rule amendment.
        (B) Prior approval required
          Notwithstanding any other provision of this section, a
        designated contract market shall submit to the Commission for
        prior approval each rule amendment that materially changes the
        terms and conditions, as determined by the Commission, in any
        contract of sale for future delivery of a commodity
        specifically enumerated in section 1a(4) of this title (or any
        option thereon) traded through its facilities if the rule
        amendment applies to contracts and delivery months which have
        already been listed for trading and have open interest.
        (C) Deadline
          If prior approval is requested under subparagraph (A), the
        Commission shall take final action on the request not later
        than 90 days after submission of the request, unless the person
        submitting the request agrees to an extension of the time
        limitation established under this subparagraph.
      (3) Approval
        The Commission shall approve any such new contract or
      instrument, new rule, or rule amendment unless the Commission
      finds that the new contract or instrument, new rule, or rule
      amendment would violate this chapter.
    (d) Violation of core principles
      (1) In general
        If the Commission determines, on the basis of substantial
      evidence, that a registered entity is violating any applicable
      core principle specified in section 7(d), 7a(d), or 7a-1(d)(2)
      (!1) of this title, the Commission shall - 
          (A) notify the registered entity in writing of the
        determination; and
          (B) afford the registered entity an opportunity to make
        appropriate changes to bring the registered entity into
        compliance with the core principles.
      (2) Failure to make changes
        If, not later than 30 days after receiving a notification under
      paragraph (1), a registered entity fails to make changes that, in
      the opinion of the Commission, are necessary to comply with the
      core principles, the Commission may take further action in
      accordance with this chapter.
    (e) Reservation of emergency authority
      Nothing in this section shall limit or in any way affect the
    emergency powers of the Commission provided in section 12a(9) of
    this title.
    (f) Rules to avoid duplicative regulation of dual registrants
      Consistent with this chapter, each designated contract market and
    registered derivatives transaction execution facility shall issue
    such rules as are necessary to avoid duplicative or conflicting
    rules applicable to any futures commission merchant registered with
    the Commission pursuant to section 6f(a) of this title (except
    paragraph (2) thereof), that is also registered with the Securities
    and Exchange Commission pursuant to section 78o(b) of title 15
    (except paragraph (11) thereof) with respect to the application of -
     
        (1) rules of such designated contract market or registered
      derivatives transaction execution facility of the type specified
      in section 6d(3) of this title involving security futures
      products; and
        (2) similar rules of national securities associations
      registered pursuant to section 78o-3(a) of title 15 and national
      securities exchanges registered pursuant to section 78f(g) of
      title 15 involving security futures products.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 5c, as added and amended Pub. L. 106-
    554, Sec. 1(a)(5) [title I, Sec. 113, title II, Sec. 251(h)], Dec.
    21, 2000, 114 Stat. 2763, 2763A-399, 2763A-444.)

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (f). Pub. L. 106-554, Sec. 1(a)(5) [title II, Sec.
    251(h)], added subsec. (f).

-FOOTNOTE-
    (!1) So in original. Reference to section 7a-1(d)(2) probably should
         be a reference to section 7a-1(c)(2).

-End-

-CITE-
    7 USC Sec. 7a-3                                             01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 7a-3. Exempt boards of trade

-STATUTE-
    (a) Election to register with the Commission
      A board of trade that meets the requirements of subsection (b) of
    this section may operate as an exempt board of trade on receipt
    from the board of trade of a notice, provided in such manner as the
    Commission may by rule or regulation prescribe, that the board of
    trade elects to operate as an exempt board of trade. Except as
    otherwise provided in this section, no provision of this chapter
    (other than subparagraphs (C) and (D) of sections 2(a)(1) and
    16(e)(2)(B) of this title) shall apply with respect to a contract
    of sale of a commodity for future delivery (or option on such a
    contract) traded on or through the facilities of an exempt board of
    trade.
    (b) Criteria for exemption
      To qualify for an exemption under subsection (a) of this section,
    a board of trade shall limit trading on or through the facilities
    of the board of trade to contracts of sale of a commodity for
    future delivery (or options on such contracts or on a commodity) - 
        (1) for which the underlying commodity has - 
          (A) a nearly inexhaustible deliverable supply;
          (B) a deliverable supply that is sufficiently large, and a
        cash market sufficiently liquid, to render any contract traded
        on the commodity highly unlikely to be susceptible to the
        threat of manipulation; or
          (C) no cash market;

        (2) that are entered into only between persons that are
      eligible contract participants at the time at which the persons
      enter into the contract; and
        (3) that are not contracts of sale (or options on such a
      contract or on a commodity) for future delivery of any security,
      including any group or index of securities or any interest in, or
      based on the value of, any security or any group or index of
      securities.
    (c) Antimanipulation requirements
      A party to a contract of sale of a commodity for future delivery
    (or option on such a contract or on a commodity) that is traded on
    an exempt board of trade shall be subject to sections 6b, 6c(b),
    6o, 9, 15, and 13(a)(2) of this title, and the Commission shall
    enforce those provisions with respect to any such trading.
    (d) Price discovery
      If the Commission finds that an exempt board of trade is a
    significant source of price discovery for transactions in the cash
    market for the commodity underlying any contract, agreement, or
    transaction traded on or through the facilities of the board of
    trade, the board of trade shall disseminate publicly on a daily
    basis trading volume, opening and closing price ranges, open
    interest, and other trading data as appropriate to the market.
    (e) Jurisdiction
      The Commission shall have exclusive jurisdiction over any
    account, agreement, contract, or transaction involving a contract
    of sale of a commodity for future delivery, or option on such a
    contract or on a commodity, to the extent that the account,
    agreement, contract, or transaction is traded on an exempt board of
    trade.
    (f) Subsidiaries
      A board of trade that is designated as a contract market or
    registered as a derivatives transaction execution facility may
    operate an exempt board of trade by establishing a separate
    subsidiary or other legal entity and otherwise satisfying the
    requirements of this section.
    (g) Misrepresentation of status
      An exempt board of trade that meets the requirements of
    subsection (b) of this section shall not represent to any person
    that the board of trade is registered with, or designated,
    recognized, licensed, or approved by the Commission.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 5d, as added Pub. L. 106-554, Sec.
    1(a)(5) [title I, Sec. 114], Dec. 21, 2000, 114 Stat. 2763, 2763A-
    401.)

-End-

-CITE-
    7 USC Sec. 7b                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 7b. Suspension or revocation of designation as registered
      entity

-STATUTE-
      The failure of a registered entity to comply with any provision
    of this chapter, or any regulation or order of the Commission under
    this chapter, shall be cause for the suspension of the registered
    entity for a period not to exceed 180 days, or revocation of
    designation as a registered entity in accordance with the
    procedures and subject to the judicial review provided in section
    8(b) of this title.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 5e, formerly Sec. 5b, as added June
    15, 1936, ch. 545, Sec. 7, 49 Stat. 1498; amended Pub. L. 90-258,
    Sec. 13, Feb. 19, 1968, 82 Stat. 30; Pub. L. 93-463, title I, Sec.
    103(a), (b), Oct. 23, 1974, 88 Stat. 1392; Pub. L. 102-546, title
    II, Sec. 209(b)(3), Oct. 28, 1992, 106 Stat. 3607; renumbered Sec.
    5e and amended Pub. L. 106-554, Sec. 1(a)(5) [title I, Secs.
    110(1), 115], Dec. 21, 2000, 114 Stat. 2763, 2763A-384, 2763A-402.)

-MISC1-
                                AMENDMENTS                            
      2000 - Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 115], amended
    section generally. Prior to amendment, section read as follows:
    "The failure or refusal of any board of trade to comply with any of
    the provisions of this chapter, or any of the rules, regulations,
    or orders of the Commission or the commission thereunder, shall be
    cause for suspending for a period not to exceed six months or
    revoking the designation of such board of trade as a 'contract
    market' in accordance with the procedure and subject to the
    judicial review provided in section 8(b) of this title."
      1992 - Pub. L. 102-546 substituted reference to section 8(b) of
    this title for reference to section 8 of this title.
      1974 - Pub. L. 93-463, Sec. 103(a), provided for substitution of
    "Commission" for "Secretary of Agriculture" except where such words
    would be stricken by section 103(b), which directed striking the
    words "the Secretary of Agriculture or" where they appeared in the
    phrase "the Secretary of Agriculture or the Commission". Because
    the word "commission" was not capitalized in the text of this
    section, section 103(b) did not apply to this section and therefore
    section 103(a) was executed, resulting in the substitution of "the
    Commission or the commission" for "the Secretary of Agriculture or
    the commission".
      1968 - Pub. L. 90-258 substituted "rules, regulations, or orders
    of the Secretary of Agriculture or the commission" for "rules and
    regulations of the Secretary of Agriculture".

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1968 AMENDMENT                 
      Amendment by Pub. L. 90-258 effective 120 days after Feb. 19,
    1968, see section 28 of Pub. L. 90-258, set out as a note under
    section 2 of this title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 13 of act June 15,
    1936, set out as an Effective Date of 1936 Amendment note under
    section 1 of this title.

-End-

-CITE-
    7 USC Sec. 7b-1                                             01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 7b-1. Designation of securities exchanges and associations as
      contract markets

-STATUTE-
      (a) Any board of trade that is registered with the Securities and
    Exchange Commission as a national securities exchange, is a
    national securities association registered pursuant to section 78o-
    3(a) of title 15, or is an alternative trading system shall be a
    designated contract market in security futures products if - 
        (1) such national securities exchange, national securities
      association, or alternative trading system lists or trades no
      other contracts of sale for future delivery, except for security
      futures products;
        (2) such national securities exchange, national securities
      association, or alternative trading system files written notice
      with the Commission in such form as the Commission, by rule, may
      prescribe containing such information as the Commission, by rule,
      may prescribe as necessary or appropriate in the public interest
      or for the protection of customers; and
        (3) the registration of such national securities exchange,
      national securities association, or alternative trading system is
      not suspended pursuant to an order by the Securities and Exchange
      Commission.

    Such designation shall be effective contemporaneously with the
    submission of notice, in written or electronic form, to the
    Commission.
      (b)(1) A national securities exchange, national securities
    association, or alternative trading system that is designated as a
    contract market pursuant to this section shall be exempt from the
    following provisions of this chapter and the rules thereunder:
        (A) Subsections (c), (e), and (g) of section 6c of this title.
        (B) Section 6j of this title.
        (C) Section 7 of this title.
        (D) Section 7a-2 of this title.
        (E) Section 10a of this title.
        (F) Section 12(d) of this title.
        (G) Section 13(f) of this title.
        (H) Section 20 of this title.

      (2) An alternative trading system that is a designated contract
    market under this section shall be required to be a member of a
    futures association registered under section 21 of this title and
    shall be exempt from any provision of this chapter that would
    require such alternative trading system to - 
        (A) set rules governing the conduct of subscribers other than
      the conduct of such subscribers' trading on such alternative
      trading system; or
        (B) discipline subscribers other than by exclusion from
      trading.

      (3) To the extent that an alternative trading system is exempt
    from any provision of this chapter pursuant to paragraph (2) of
    this subsection, the futures association registered under section
    21 of this title of which the alternative trading system is a
    member shall set rules governing the conduct of subscribers to the
    alternative trading system and discipline the subscribers.
      (4)(A) Except as provided in subparagraph (B), but
    notwithstanding any other provision of this chapter, the
    Commission, by rule, regulation, or order, may conditionally or
    unconditionally exempt any designated contract market in security
    futures subject to the designation requirement of this section from
    any provision of this chapter or of any rule or regulation
    thereunder, to the extent such exemption is necessary or
    appropriate in the public interest and is consistent with the
    protection of investors.
      (B) The Commission shall, by rule or regulation, determine the
    procedures under which an exemptive order under this section is
    granted and may, in its sole discretion, decline to entertain any
    application for an order of exemption under this section.
      (C) An alternative trading system shall not be deemed to be an
    exchange for any purpose as a result of the designation of such
    alternative trading system as a contract market under this section.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 5f, as added Pub. L. 106-554, Sec.
    1(a)(5) [title II, Sec. 252(a)], Dec. 21, 2000, 114 Stat. 2763,
    2763A-445.)

-End-

-CITE-
    7 USC Sec. 7b-2                                             01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 7b-2. Privacy

-STATUTE-
    (a) Treatment as financial institutions
      Notwithstanding section 509(3)(B) of the Gramm-Leach-Bliley Act
    [15 U.S.C. 6809(3)(B)], any futures commission merchant, commodity
    trading advisor, commodity pool operator, or introducing broker
    that is subject to the jurisdiction of the Commission under this
    chapter with respect to any financial activity shall be treated as
    a financial institution for purposes of title V of such Act [15
    U.S.C. 6801 et seq.] with respect to such financial activity.
    (b) Treatment of CFTC as Federal functional regulator
      For purposes of title V of such Act [15 U.S.C. 6801 et seq.], the
    Commission shall be treated as a Federal functional regulator
    within the meaning of section 509(2) of such Act [15 U.S.C.
    6809(2)] and shall prescribe regulations under such title within 6
    months after December 21, 2000.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 5g, as added Pub. L. 106-554, Sec.
    1(a)(5) [title I, Sec. 124], Dec. 21, 2000, 114 Stat. 2763, 2763A-
    411.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Gramm-Leach-Bliley Act, referred to in text, is Pub. L. 106-
    102, Nov. 12, 1999, 113 Stat. 1338. Title V of the Act is
    classified principally to chapter 94 (Sec. 6801 et seq.) of Title
    15, Commerce and Trade. For complete classification of this Act to
    the Code, see Short Title of 1999 Amendment note set out under
    section 1811 of Title 12, Banks and Banking, and Tables.

-End-

-CITE-
    7 USC Sec. 8                                                01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 8. Application for designation as contract market or
      derivatives transaction execution facility; time; suspension or
      revocation of designation; hearing; review by court of appeals

-STATUTE-
      (a) Any person desiring to be designated or registered as a
    contract market or derivatives transaction execution facility shall
    make application to the Commission for the designation or
    registration and accompany the same with a showing that it complies
    with the conditions set forth in this chapter, and with a
    sufficient assurance that it will continue to comply with the the
    (!1) requirements of this chapter. The Commission shall approve or
    deny an application for designation or registration as a contract
    market or derivatives transaction execution facility within 180
    days of the filing of the application. If the Commission notifies
    the person that its application is materially incomplete and
    specifies the deficiencies in the application, the running of the
    180-day period shall be stayed from the time of such notification
    until the application is resubmitted in completed form: Provided,
    That the Commission shall have not less than sixty days to approve
    or deny the application from the time the application is
    resubmitted in completed form. If the Commission denies an
    application, it shall specify the grounds for the denial. In the
    event of a refusal to designate or register as a contract market or
    derivatives transaction execution facility any person that has made
    application therefor, the person shall be afforded an opportunity
    for a hearing on the record before the Commission, with the right
    to appeal an adverse decision after such hearing to the court of
    appeals as provided for in other cases in subsection (b) of this
    section.

      (b) The Commission is authorized to suspend for a period not to
    exceed six months or to revoke the designation or registration of
    any contract market or derivatives transaction execution facility
    on a showing that such contract market or derivatives transaction
    execution facility is not enforcing or has not enforced its rules
    of government made a condition of its designation or registration
    as set forth in sections 7 through 7a-1 of this title or section 7b-
    1 of this title or that such contract market or derivatives
    transaction execution facility, or any director, officer, agent, or
    employee thereof, otherwise is violating or has violated any of the
    provisions of this chapter or any of the rules, regulations, or
    orders of the Commission or the Commission (!2) thereunder. Such
    suspension or revocation shall only be after a notice to the
    officers of the contract market or derivatives transaction
    execution facility affected and upon a hearing on the record:
    Provided, That such suspension or revocation shall be final and
    conclusive, unless within fifteen days after such suspension or
    revocation by the Commission such person appeals to the court of
    appeals for the circuit in which it has its principal place of
    business, by filing with the clerk of such court a written petition
    praying that the order of the Commission be set aside or modified
    in the manner stated in the petition, together with a bond in such
    sum as the court may determine, conditioned that such person will
    pay the costs of the proceedings if the court so directs. The clerk
    of the court in which such a petition is filed shall immediately
    cause a copy thereof to be delivered to the Commission and file in
    the court the record in such proceedings, as provided in section
    2112 of title 28. The testimony and evidence taken or submitted
    before the Commission, duly filed as aforesaid as a part of the
    record, shall be considered by the court of appeals as the evidence
    in the case. Such a court may affirm or set aside the order of the
    Commission or may direct it to modify its order. No such order of
    the Commission shall be modified or set aside by the court of
    appeals unless it is shown by the person that the order is
    unsupported by the weight of the evidence or was issued without due
    notice and a reasonable opportunity having been afforded to such
    person for a hearing, or infringes the Constitution of the United
    States, or is beyond the jurisdiction of the Commission.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 6(a), (b), formerly Sec. 6(a), 42
    Stat. 1001; June 25, 1948, ch. 646, Sec. 32(a), 62 Stat. 991; May
    24, 1949, ch. 139, Sec. 127, 63 Stat. 107; Pub. L. 85-791, Sec.
    7(a), Aug. 28, 1958, 72 Stat. 944; Pub. L. 90-258, Secs. 14, 15,
    Feb. 19, 1968, 82 Stat. 30; Pub. L. 93-463, title I, Sec. 103(a)-
    (c), Oct. 23, 1974, 88 Stat. 1392; Pub. L. 95-405, Sec. 13(1),
    (2), Sept. 30, 1978, 92 Stat. 871; Pub. L. 97-444, title II, Sec.
    218, Jan. 11, 1983, 96 Stat. 2308; Pub. L. 98-620, title IV, Sec.
    402(3), Nov. 8, 1984, 98 Stat. 3357; renumbered Sec. 6(a), (b) and
    amended Pub. L. 102-546, title II, Sec. 209(a)(1)-(3), title IV,
    Sec. 402(1)(B), (9)(A), Oct. 28, 1992, 106 Stat. 3606, 3624, 3625;
    Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(12)(A), (B)],
    Dec. 21, 2000, 114 Stat. 2763, 2763A-408.)

-COD-
                               CODIFICATION                           
      Section is comprised of subsecs. (a) and (b) of section 6 of act
    Sept. 21, 1922. Subsec. (c) of section 6 is classified to sections
    9 and 15 of this title. Subsecs. (d), (e), (f), and (g) of section
    6 are classified to sections 13b, 9a, 9b, and 9c of this title,
    respectively.

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (a). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(12)(A)(iv)], substituted "designate or register as a
    contract market or derivatives transaction execution facility any
    person that has made application therefor, the person" for
    "designate as a 'contract market' any board of trade that has made
    application therefor, such board of trade" in last sentence.
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(12)(A)(iii)],
    in third sentence, substituted "person" for "board of trade" and
    "180-day period" for "one-year period".
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(12)(A)(ii)],
    substituted "designation or registration as a contract market or
    derivatives transaction execution facility within 180 days" for
    "designation as a contract market within one year" in second
    sentence.
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(12)(A)(i)],
    in first sentence, substituted "person desiring to be designated or
    registered as a contract market or derivatives transaction
    execution facility shall make application to the Commission for the
    designation or registration" for "board of trade desiring to be
    designated a 'contract market' shall make application to the
    Commission for such designation", "conditions set forth in this
    chapter" for "above conditions", and "the requirements of this
    chapter" for "above requirements".
      Subsec. (b). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(12)(B)(iii)], substituted "person" for "board of trade" in
    two places in last sentence.
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(12)(B)(ii)],
    in second sentence, substituted "contract market or derivatives
    transaction execution facility affected" for "board of trade
    affected", "person appeals" for "board of trade appeals" and
    "person will" for "board of trade will".
      Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(12)(B)(i)],
    in first sentence, substituted "designation or registration of any
    contract market or derivatives transaction execution facility on"
    for "designation of any board of trade as a 'contract market'
    upon", "contract market or derivatives transaction execution
    facility" for "board of trade" in two places, and "designation or
    registration as set forth in sections 7 through 7a-1 of this title
    or section 7b-1 of this title" for "designation as set forth in
    section 7 of this title".
      1992 - Pub. L. 102-546, Sec. 209(a)(1), (2), designated first
    par. as subsec. (a) and redesignated former par. (a) as subsec.
    (b).
      Subsec. (a). Pub. L. 102-546, Sec. 209(a)(3), substituted
    "subsection (b)" for "paragraph (a)".
      Subsec. (b). Pub. L. 102-546, Sec. 402(9)(A), which directed
    amendment of first sentence by striking "the Secretary of
    Agriculture or", could not be executed because of amendment by Pub.
    L. 93-463, Sec. 103(a). See 1974 Amendment note below.
      Pub. L. 102-546, Sec. 402(1)(B), substituted "Commission" for
    "commission" wherever appearing.
      1984 - Par. (a). Pub. L. 98-620 struck out provisions requiring
    proceedings in such cases in the court of appeals to be made a
    preferred cause and expedited in every way.
      1983 - Pub. L. 97-444 required approval or denial of application
    within one year period of filing of application, stay of such
    period following notification that application was incomplete and
    deficient until resubmission of application, minimum period prior
    to acting upon resubmitted application, and specification of
    grounds for denial of application.
      1978 - Pub. L. 95-405, Sec. 13(1), in provisions before par. (a)
    inserted "on the record" after "opportunity for a hearing".
      Par. (a). Pub. L. 95-405, Sec. 13(2), inserted "on the record"
    after "upon a hearing".
      1974 - Pub. L. 93-463, Sec. 103(a), substituted "Commission" for
    "Secretary of Agriculture" in first par.
      Par. (a). Pub. L. 93-463, Sec. 103(c), struck out "the Secretary
    of Agriculture, who shall thereupon notify the other members of"
    after "The clerk of the court in which such a petition is filed
    shall immediately cause a copy thereof to be delivered to".
      Pub. L. 93-463, Sec. 103(a), provided for substitution of
    "Commission" for "Secretary of Agriculture" except where such words
    would be stricken by section 103(b), which directed striking the
    words "the Secretary of Agriculture or" where they appeared in the
    phrase "the Secretary of Agriculture or the Commission". Because
    the word "commission" was not capitalized in that phrase in par.
    (a), section 103(b) did not apply to par. (a) and therefore section
    103(a) was executed, resulting in the substitution of "the
    Commission or the commission" for "the Secretary of Agriculture or
    the commission".
      1968 - Pub. L. 90-258, Sec. 14, inserted provision affording any
    board of trade refused a contract market designation a hearing
    before the Commission with right to appeal in adverse decision to
    the court of appeals as provided for in par. (a) of this section at
    end of first par.
      Par. (a). Pub. L. 90-258, Sec. 15, amended par. (a) generally,
    striking out such parts both of first sentence and of proviso of
    last sentence as described the commission as made up of the
    Secretary of Agriculture, Secretary of Commerce, and Attorney
    General (covered in definition of "Commission" in section 2 of this
    title, including representation of such officials by their
    designees), extending grounds for suspension or revocation of
    designation to include violations of any provisions of this chapter
    or rules, regulations, or orders of the Secretary of Agriculture or
    commission, requiring delivery of appeal petitions to Secretary of
    Agriculture rather than any member of the commission, who would
    notify the other members, and filing of commission records of
    proceedings on appeal by the Secretary of Agriculture and not the
    commission, striking out provisions describing Secretary of
    Agriculture as Chairman (now found in section 2 of this title),
    superseding such part of proviso of seventh sentence as authorized
    appeals to the commission from Secretary of Agriculture's refusal
    of a contract market designation by provisions of first par. of
    this section, and striking out such other part as made decision of
    court on appeal from commission final and binding on the parties.
      1958 - Pub. L. 85-791 substituted "thereupon file in the court
    the record in such proceedings, as provided in section 2112 of
    title 28" for "forthwith prepare, certify, and file in the court a
    full and accurate transcript of the record in such proceedings
    including the notice to the board of trade, a copy of the charges,
    the evidence, and the report and order" in third notice, and struck
    out "certified and" after "duly" in fourth sentence.

-CHANGE-
                              CHANGE OF NAME                          
      Act June 25, 1948, as amended by act May 24, 1949, substituted
    "court of appeals" for "circuit court of appeals" wherever
    appearing in this section.

-MISC2-
                     EFFECTIVE DATE OF 1984 AMENDMENT                 
      Amendment by Pub. L. 98-620 not applicable to cases pending on
    Nov. 8, 1984, see section 403 of Pub. L. 98-620, set out as an
    Effective Date note under section 1657 of Title 28, Judiciary and
    Judicial Procedure.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1968 AMENDMENT                 
      Amendment by Pub. L. 90-258 effective 120 days after Feb. 19,
    1968, see section 28 of Pub. L. 90-258, set out as a note under
    section 2 of this title.

-FOOTNOTE-
    (!1) So in original.

    (!2) So in original. The words "or the Commission" probably
         should not appear.

-End-

-CITE-
    7 USC Sec. 9                                                01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 9. Exclusion of persons from privilege of "registered
      entities"; procedure for exclusion; review by court of appeals

-STATUTE-
      If the Commission has reason to believe that any person (other
    than a registered entity) is manipulating or attempting to
    manipulate or has manipulated or attempted to manipulate the market
    price of any commodity, in interstate commerce, or for future
    delivery on or subject to the rules of any registered entity, or
    has willfully made any false or misleading statement of a material
    fact in any registration application or any report filed with the
    Commission under this chapter, or willfully omitted to state in any
    such application or report any material fact which is required to
    be stated therein, or otherwise is violating or has violated any of
    the provisions of this chapter or of the rules, regulations, or
    orders of the Commission or the Commission (!1) thereunder, it may
    serve upon such person a complaint stating its charges in that
    respect, which complaint shall have attached or shall contain
    therein a notice of hearing, specifying a day and place not less
    than three days after the service thereof, requiring such person to
    show cause why an order should not be made prohibiting him from
    trading on or subject to the rules of any registered entity, and
    directing that all registered entities refuse all privileges to
    such person, until further notice of the Commission, and to show
    cause why the registration of such person, if registered with the
    Commission in any capacity, should not be suspended or revoked.
    Said hearing may be held in Washington, District of Columbia, or
    elsewhere, before the Commission, or before an Administrative Law
    Judge designated by the Commission, which Administrative Law Judge
    shall cause all evidence to be reduced to writing and forthwith
    transmit the same to the Commission. Upon evidence received, the
    Commission may (1) prohibit such person from trading on or subject
    to the rules of any registered entity and require all registered
    entities to refuse such person all trading privileges thereon for
    such period as may be specified in the order, (2) if such person is
    registered with the Commission in any capacity, suspend, for a
    period not to exceed six months, or revoke, the registration of
    such person, (3) assess such person a civil penalty of not more
    than the higher of $100,000 or triple the monetary gain to such
    person for each such violation (!2) and (4) require restitution to
    customers of damages proximately caused by violations of such
    persons. Notice of such order shall be sent forthwith by registered
    mail or by certified mail or delivered to the offending person and
    to the governing boards of said registered entities. After the
    issuance of the order by the Commission, the person against whom it
    is issued may obtain a review of such order or such other equitable
    relief as to the court may seem just by filing in the United States
    court of appeals of the circuit in which the petitioner is doing
    business, or in the case of an order denying registration, the
    circuit in which the petitioner's principal place of business
    listed on petitioner's application for registration is located, a
    written petition, within fifteen days after the notice of such
    order is given to the offending person praying that the order of
    the Commission be set aside. A copy of such petition shall be
    forthwith transmitted by the clerk of the court to the Commission
    and thereupon the Commission shall file in the court the record
    theretofore made, as provided in section 2112 of title 28. Upon the
    filing of the petition the court shall have jurisdiction to affirm,
    to set aside, or modify the order of the Commission, and the
    findings of the Commission as to the facts, if supported by the
    weight of evidence, shall in like manner be conclusive.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 6(c), formerly Sec. 6(b), 42 Stat.
    1002; June 15, 1936, ch. 545, Sec. 8(a)-(d), (h)-(j), 49 Stat.
    1498, 1499; June 25, 1948, ch. 646, Sec. 32(a), 62 Stat. 991; May
    24, 1949, ch. 139, Sec. 127, 63 Stat. 107; Pub. L. 85-791, Sec.
    7(b), Aug. 28, 1958, 72 Stat. 944; Pub. L. 86-507, Sec. 1(2), June
    11, 1960, 74 Stat. 200; Pub. L. 90-258, Sec. 16, Feb. 19, 1968, 82
    Stat. 30; Pub. L. 93-463, title I, Sec. 103(a), (b), (e), title II,
    Secs. 204(b), 205(b), 212(a)(1), (2), title IV, Sec. 408, Oct. 23,
    1974, 88 Stat. 1392, 1397, 1400, 1403, 1414; Pub. L. 97-444, title
    II, Sec. 219, Jan. 11, 1983, 96 Stat. 2308; renumbered Sec. 6(c)
    and amended Pub. L. 102-546, title II, Secs. 209(a)(1), 212(b),
    223, title IV, Sec. 402(1)(C), (6), (9)(B), Oct. 28, 1992, 106
    Stat. 3606, 3609, 3617, 3624, 3625; Pub. L. 106-554, Sec. 1(a)(5)
    [title I, Sec. 123(a)(12)(C)], Dec. 21, 2000, 114 Stat. 2763, 2763A-
    409.)

-COD-
                               CODIFICATION                           
      Section is comprised of part of subsec. (c) of section 6 of act
    Sept. 21, 1922. A further provision of subsec. (c) is contained in
    section 15 of this title. Subsecs. (a) and (b) of section 6 are
    classified to section 8 of this title. Subsecs. (d), (e), (f), and
    (g) of section 6 are classified to sections 13b, 9a, 9b, and 9c of
    this title, respectively.

-MISC1-
                                AMENDMENTS                            
      2000 - Pub. L. 106-554 substituted "registered entity" for
    "contract market" wherever appearing, "registered entities" for
    "contract markets" wherever appearing, and "privileges" for
    "trading privileges" in two places.
      1992 - Pub. L. 102-546, Sec. 402(9)(B), which directed amendment
    of first sentence by striking "the Secretary of Agriculture or",
    could not be executed because of amendment by Pub. L. 93-463, Sec.
    103(a). See 1974 Amendment note below.
      Pub. L. 102-546, Secs. 209(a)(1), 212(b), 223, 402(1)(C), (6),
    substituted, in first sentence, "Commission thereunder" for
    "commission thereunder", in sentence beginning "Upon evidence
    received", inserted "(1)", substituted "(2) if" for "and, if",
    "suspend" for "may suspend", "(3)" for "and may", "the higher of
    $100,000 or triple the monetary gain to such person" for
    "$100,000", and inserted before period "and (4) require restitution
    to customers of damages proximately caused by violations of such
    persons", and in sentence beginning "After the issuance",
    substituted "offending person" for "offending person.".
      1983 - Pub. L. 97-444 struck out "as futures commission merchant
    or any person associated therewith as described in section 6k of
    this title, commodity trading advisor, commodity pool operator, or
    as floor broker hereunder" after "such person, if registered" and
    also after "such person is registered" and inserted ", or in the
    case of an order denying registration, the circuit in which the
    petitioner's principal place of business listed on petitioner's
    application for registration is located," after "court of appeals
    of the circuit in which the petitioner is doing business".
      1974 - Pub. L. 93-463, Secs. 103(e), 204(b), 205(b), 212(a)(1),
    (2), 408, substituted "it" for "he", inserted "or any person
    associated therewith as described in section 6k of this title,"
    after "futures commission merchant" wherever appearing, inserted
    "commodity trading advisor, commodity pool operator" before "or as
    floor broker" wherever appearing, inserted provision for the
    assessment of civil penalties of not more than $100,000 for each
    violation, set a limit of fifteen days after the issuance of an
    order within which period the person against whom the order was
    issued must file with the court of appeals his petition that the
    order be set aside, and substituted "an Administrative Law Judge"
    and "Administrative Law Judge" for "a referee" and "referee",
    respectively.
      Pub. L. 93-463, Sec. 103(a), provided for substitution of
    "Commission" for "Secretary of Agriculture" except where such words
    would be stricken by section 103(b), which directed striking the
    words "the Secretary of Agriculture or" where they appeared in the
    phrase "the Secretary of Agriculture or the Commission". Section
    103(a) was executed wherever the term "Secretary of Agriculture"
    appeared in this section including in the phrase "the Secretary of
    Agriculture or the commission" in the first sentence. Because the
    word "commission" was not capitalized in that phrase in the first
    sentence, section 103(b) did not apply to that phrase and therefore
    section 103(a) was executed, resulting in the substitution of "the
    Commission or the commission" for "the Secretary of Agriculture or
    the commission".
      1968 - Pub. L. 90-258 amended first sentence generally, providing
    for denial of trading privileges to persons other than contract
    markets and suspension or revocation of registration of futures
    commission merchants and floor brokers, who are manipulating or
    have attempted to manipulate prices, for willful, material,
    misstatements in, or omissions from, reports or registration
    statements, and for violations of orders of Secretary of
    Agriculture or commission, and authorizing the Secretary to
    prohibit such persons from trading on or subject to rules of any
    contract market.
      1960 - Pub. L. 86-507 inserted "or by certified mail" after
    "registered mail".
      1958 - Pub. L. 85-791 substituted "transmitted by the clerk of
    the court to the Secretary of Agriculture and thereupon the
    Secretary of Agriculture shall file in the court the record
    theretofore made, as provided in section 2112 of Title 28" for
    "served upon the Secretary of Agriculture by delivering such copy
    to him and thereupon the Secretary of Agriculture shall forthwith
    certify and file in the court a transcript of the record
    theretofore made, including evidence received" in seventh sentence,
    and substituted "petition" for "transcript" in eighth sentence.
      1936 - Act June 15, 1936, among other changes, amended section by
    inserting provisions relating to the service of complaints and
    penalties for violations of this chapter.

-CHANGE-
                              CHANGE OF NAME                          
      Act June 25, 1948, as amended by act May 24, 1949, substituted
    "court of appeals" for "circuit court of appeals" wherever
    appearing in this section.

-MISC2-
                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1968 AMENDMENT                 
      Amendment by Pub. L. 90-258 effective 120 days after Feb. 19,
    1968, see section 28 of Pub. L. 90-258, set out as a note under
    section 2 of this title.

                     EFFECTIVE DATE OF 1936 AMENDMENT                 
      Amendment by act June 15, 1936, effective 90 days after June 15,
    1936, see section 13 of act June 15, 1936, set out as a note under
    section 1 of this title.

-FOOTNOTE-
    (!1) So in original. The words "or the Commission" probably should
         not appear.

    (!2) So in original. Probably should be followed by a comma.

-End-

-CITE-
    7 USC Sec. 9a                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 9a. Assessment of money penalties

-STATUTE-
      (1) In determining the amount of the money penalty assessed under
    sections 9 and 15 of this title, the Commission shall consider the
    appropriateness of such penalty to the gravity of the violation.
      (2) Unless the person against whom a money penalty is assessed
    under sections 9 and 15 of this title shows to the satisfaction of
    the Commission within fifteen days from the expiration of the
    period allowed for payment of such penalty that either an appeal as
    authorized by sections 9 and 15 of this title has been taken or
    payment of the full amount of the penalty then due has been made,
    at the end of such fifteen-day period and until such person shows
    to the satisfaction of the Commission that payment of such amount
    with interest thereon to date of payment has been made - 
        (A) such person shall be prohibited automatically from the
      privileges of all registered entities; and
        (B) if such person is registered with the Commission, such
      registration shall be suspended automatically.

      (3) If a person against whom a money penalty is assessed under
    sections 9 and 15 of this title takes an appeal and if the
    Commission prevails or the appeal is dismissed, unless such person
    shows to the satisfaction of the Commission that payment of the
    full amount of the penalty then due has been made by the end of
    thirty days from the date of entry of judgment on the appeal - 
        (A) such person shall be prohibited automatically from the
      privileges of all registered entities; and
        (B) if such person is registered with the Commission, such
      registration shall be suspended automatically.

    If the person against whom the money penalty is assessed fails to
    pay such penalty after the lapse of the period allowed for appeal
    or after the affirmance of such penalty, the Commission may refer
    the matter to the Attorney General who shall recover such penalty
    by action in the appropriate United States district court.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 6(e), formerly Sec. 6(d), as added
    Pub. L. 93-463, title II, Sec. 212(a)(3), Oct. 23, 1974, 88 Stat.
    1403; renumbered Sec. 6(e) and amended Pub. L. 102-546, title II,
    Sec. 209(a)(1), (5), Oct. 28, 1992, 106 Stat. 3606; Pub. L. 106-
    554, Sec. 1(a)(5) [title I, Sec. 123(a)(12)(E)], Dec. 21, 2000,
    114 Stat. 2763, 2763A-409.)

-COD-
                               CODIFICATION                           
      Section is comprised of subsec. (e) of section 6 of act Sept. 21,
    1922. Subsecs. (a) and (b) of section 6 are classified to section 8
    of this title. Subsec. (c) of section 6 is classified to sections 9
    and 15 of this title. Subsecs. (d), (f), and (g) of section 6 are
    classified to sections 13b, 9b, and 9c of this title, respectively.

-MISC1-
                                AMENDMENTS                            
      2000 - Pars. (2)(A), (3)(A). Pub. L. 106-554 substituted "the
    privileges of all registered entities" for "trading on all contract
    markets".
      1992 - Pub. L. 102-546 amended section generally. Prior to
    amendment, section read as follows: "In determining the amount of
    the money penalty assessed under sections 9 and 15 of this title,
    the Commission shall consider, in the case of a person whose
    primary business involves the use of the commodity futures market -
    the appropriateness of such penalty to the size of the business of
    the person charged, the extent of such person's ability to continue
    in business, and the gravity of the violation; and in the case of a
    person whose primary business does not involve the use of the
    commodity futures market - the appropriateness of such penalty to
    the net worth of the person charged, and the gravity of the
    violation. If the offending person upon whom such penalty is
    imposed, after the lapse of the period allowed for appeal or after
    the affirmance of such penalty, shall fail to pay such penalty the
    Commission shall refer the matter to the Attorney General who shall
    recover such penalty by action in the appropriate United States
    district court."

                              EFFECTIVE DATE                          
      For effective date of section, see section 418 of Pub. L. 93-463,
    set out as an Effective Date of 1974 Amendment note under section 2
    of this title.

-End-

-CITE-
    7 USC Sec. 9b                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 9b. Rules prohibiting deceptive and other abusive
      telemarketing acts or practices

-STATUTE-
      (1) Except as provided in paragraph (2), not later than six
    months after the effective date of rules promulgated by the Federal
    Trade Commission under section 6102(a) of title 15, the Commission
    shall promulgate, or require each registered futures association to
    promulgate, rules substantially similar to such rules to prohibit
    deceptive and other abusive telemarketing acts or practices by any
    person registered or exempt from registration under this chapter in
    connection with such person's business as a futures commission
    merchant, introducing broker, commodity trading advisor, commodity
    pool operator, leverage transaction merchant, floor broker, or
    floor trader, or a person associated with any such person.
      (2) The Commission is not required to promulgate rules under
    paragraph (1) if it determines that - 
        (A) rules adopted by the Commission under this chapter provide
      protection from deceptive and abusive telemarketing by persons
      described under paragraph (1) substantially similar to that
      provided by rules promulgated by the Federal Trade Commission
      under section 6102(a) of title 15; or
        (B) such a rule promulgated by the Commission is not necessary
      or appropriate in the public interest, or for the protection of
      customers in the futures and options markets, or would be
      inconsistent with the maintenance of fair and orderly markets.

    If the Commission determines that an exception described in
    subparagraph (A) or (B) applies, the Commission shall publish in
    the Federal Register its determination with the reasons for it.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 6(f), as added Pub. L. 103-297, Sec.
    3(e)(2), Aug. 16, 1994, 108 Stat. 1547.)

-COD-
                               CODIFICATION                           
      Section is comprised of subsec. (f) of section 6 of act Sept. 21,
    1922. Subsecs. (a) and (b) of section 6 are classified to section 8
    of this title. Subsec. (c) of section 6 is classified to sections 9
    and 15 of this title. Subsecs. (d), (e), and (g) of section 6 are
    classified to sections 13b, 9a, and 9c of this title, respectively.

-End-

-CITE-
    7 USC Sec. 9c                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 9c. Notice of investigations and enforcement actions

-STATUTE-
      The Commission shall provide the Securities and Exchange
    Commission with notice of the commencement of any proceeding and a
    copy of any order entered by the Commission pursuant to sections 9,
    15, and 13b of this title against any futures commission merchant
    or introducing broker registered pursuant to section 6f(a)(2) of
    this title, any floor broker or floor trader exempt from
    registration pursuant to section 6f(a)(3) of this title, any
    associated person exempt from registration pursuant to section
    6k(6) (!1) of this title, or any board of trade designated as a
    contract market pursuant to section 7b-1 of this title.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 6(g), as added Pub. L. 106-554, Sec.
    1(a)(5) [title II, Sec. 253(b)], Dec. 21, 2000, 114 Stat. 2763,
    2763A-449.)

-COD-
                               CODIFICATION                           
      Section is comprised of subsec. (g) of section 6 of act Sept. 21,
    1922. Subsecs. (a) and (b) of section 6 are classified to section 8
    of this title. Subsec. (c) of section 6 is classified to sections 9
    and 15 of this title. Subsecs. (d), (e), and (f) of section 6 are
    classified to sections 13b, 9a, and 9b of this title, respectively.

-FOOTNOTE-
    (!1) So in original. Probably should refer to the second par. (5) of
         section 6k.

-End-

-CITE-
    7 USC Sec. 10                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 10. Repealed.

-MISC1-
    Sec. 10. Repealed. June 25, 1948, ch. 646, Sec. 39, 62 Stat. 992,
      eff. Sept. 1, 1948.
      Section, acts Sept. 21, 1922, ch. 369, Sec. 6(b), 42 Stat. 1001;
    June 15, 1936, ch. 545, Sec. 8(k), 49 Stat. 1499, related to review
    by Supreme Court on certiorari. See section 1254 of Title 28,
    Judiciary and Judicial Procedure.

-End-

-CITE-
    7 USC Sec. 10a                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 10a. Cooperative associations and corporations, exclusion from
      board of trade; rules of board inapplicable to payment of
      compensation by association

-STATUTE-
      (a) No board of trade which has been designated or registered as
    a contract market or a derivatives transaction execution facility
    exclude (!1) from membership in, and all privileges on, such board
    of trade, any association or corporation engaged in cash commodity
    business having adequate financial responsibility which is
    organized under the cooperative laws of any State, or which has
    been recognized as a cooperative association of producers by the
    United States Government or by any agency thereof, if such
    association or corporation complies and agrees to comply with such
    terms and conditions as are or may be imposed lawfully upon other
    members of such board, and as are or may be imposed lawfully upon a
    cooperative association of producers engaged in cash commodity
    business, unless such board of trade is authorized by the
    commission to exclude such association or corporation from
    membership and privileges after hearing held upon at least three
    days' notice subsequent to the filing of complaint by the board of
    trade: Provided, however, That if any such association or
    corporation shall fail to meet its obligations with any established
    clearing house or clearing agency of any contract market, such
    association or corporation shall be ipso facto debarred from
    further trading on such contract market, except such trading as may
    be necessary to close open trades and to discharge existing
    contracts in accordance with the rules of such contract market
    applicable in such cases. Such commission may prescribe that such
    association or corporation shall have and retain membership and
    privileges, with or without imposing conditions, or it may permit
    such board of trade immediately to bar such association or
    corporation from membership and privileges. Any order of said
    commission entered hereunder shall be reviewable by the court of
    appeals for the circuit in which such association or corporation,
    or such board of trade, has its principal place of business, on
    written petition either of such association or corporation, or of
    such board of trade, under the procedure provided in section 8(b)
    of this title, but such order shall not be stayed by the court
    pending review.

      (b) No rule of any board of trade designated or registered as a
    contract market or a derivatives transaction execution facility
    shall forbid or be construed to forbid the payment of compensation
    on a commodity-unit basis, or otherwise, by any federated
    cooperative association to its regional member-associations for
    services rendered or to be rendered in connection with any
    organization work, educational activity, or procurement of
    patronage, provided no part of any such compensation is returned to
    patrons (whether members or nonmembers) of such cooperative
    association, or of its regional or local member-associations,
    otherwise than as a dividend on capital stock or as a patronage
    dividend out of the net earnings or surplus of such federated
    cooperative association.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 6a, as added June 15, 1936, ch. 545,
    Sec. 9, 49 Stat. 1499; amended June 25, 1948, ch. 646, Sec. 32(a),
    62 Stat. 991; May 24, 1949, ch. 139, Sec. 127, 63 Stat. 107; Pub.
    L. 102-546, title II, Sec. 209(b)(4), title IV, Sec. 402(8), Oct.
    28, 1992, 106 Stat. 3607, 3625; Pub. L. 106-554, Sec. 1(a)(5)
    [title I, Sec. 123(a)(13)], Dec. 21, 2000, 114 Stat. 2763, 2763A-
    409.)

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (a). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(13)(A)], substituted "designated or registered as a contract
    market or a derivatives transaction execution facility" for
    "designated as a 'contract market' shall".
      Subsec. (b). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(13)(B)], substituted "designated or registered as a contract
    market or a derivatives transaction execution facility" for
    "designated as a contract market".
      1992 - Pub. L. 102-546 redesignated subsecs. (1) and (2) as (a)
    and (b), respectively, and in subsec. (a) substituted reference to
    section 8(b) of this title for reference to section 8 of this
    title.

-CHANGE-
                              CHANGE OF NAME                          
      Act June 25, 1948, as amended by act May 24, 1949, substituted
    "court of appeals" for "circuit court of appeals" wherever
    appearing.

-MISC2-
                              EFFECTIVE DATE                          
      For effective date of section, see section 13 of act June 15,
    1936, set out as an Effective Date of 1936 Amendment note under
    section 1 of this title.

-FOOTNOTE-
    (!1) So in original. Probably should read "shall exclude".

-End-

-CITE-
    7 USC Sec. 11                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 11. Vacation on request of designation or registration as
      "registered entity"; redesignation or reregistration

-STATUTE-
      Any person that has been designated or registered a registered
    entity in the manner provided in this chapter may have such
    designation or registration vacated and set aside by giving notice
    in writing to the Commission requesting that its designation or
    registration as a registered entity be vacated, which notice shall
    be served at least ninety days prior to the date named therein as
    the date when the vacation of designation or registration shall
    take effect. Upon receipt of such notice the Commission shall
    forthwith order the vacation of the designation or registration of
    the registered entity, effective upon the day named in the notice,
    and shall forthwith send a copy of the notice and its order to all
    other registered entities. From and after the date upon which the
    vacation became effective the said person can thereafter be
    designated or registered again a registered entity by making
    application to the Commission in the manner in this chapter
    provided for an original application.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 7, 42 Stat. 1002; Pub. L. 93-463,
    title I, Sec. 103(a), (e), Oct. 23, 1974, 88 Stat. 1392; Pub. L.
    106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(17)], Dec. 21, 2000,
    114 Stat. 2763, 2763A-409.)

-MISC1-
                                AMENDMENTS                            
      2000 - Pub. L. 106-554, in first sentence, substituted "person"
    for "board of trade", inserted "or registered" after "designated",
    inserted "or registration" after "designation" wherever appearing,
    and substituted "registered entity" for "contract market" in two
    places, in second sentence, substituted "designation or
    registration of the registered entity" for "designation of such
    board of trade as a contract market" and "registered entities" for
    "contract markets", and, in last sentence, substituted "person" for
    "board of trade" and "designated or registered again a registered
    entity" for "designated again a contract market".
      1974 - Pub. L. 93-463 substituted "Commission" for "Secretary of
    Agriculture" and "its order" for "his order".

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

-End-

-CITE-
    7 USC Sec. 12                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 12. Public disclosure

-STATUTE-
    (a) Investigations respecting operations of boards of trade and
      others subject to this chapter; publication of results;
      restrictions; information received from foreign futures
      authorities; undercover operations; notice of investigations and
      enforcement actions
      (1) For the efficient execution of the provisions of this
    chapter, and in order to provide information for the use of
    Congress, the Commission may make such investigations as it deems
    necessary to ascertain the facts regarding the operations of boards
    of trade and other persons subject to the provisions of this
    chapter. The Commission may publish from time to time the results
    of any such investigation and such general statistical information
    gathered therefrom as it deems of interest to the public: Provided,
    That except as otherwise specifically authorized in this chapter,
    the Commission may not publish data and information that would
    separately disclose the business transactions or market positions
    of any person and trade secrets or names of customers: Provided
    further, That the Commission may withhold from public disclosure
    any data or information concerning or obtained in connection with
    any pending investigation of any person. The Commission shall not
    be compelled to disclose any information or data obtained from a
    foreign futures authority if - 
        (A) the foreign futures authority has in good faith determined
      and represented to the Commission that disclosure of such
      information or data by that foreign futures authority would
      violate the laws applicable to that foreign futures authority;
      and
        (B) the Commission obtains such information pursuant to - 
          (i) such procedure as the Commission may authorize for use in
        connection with the administration or enforcement of this
        chapter; or
          (ii) a memorandum of understanding with that foreign futures
        authority;

    except that nothing in this subsection shall prevent the Commission
    from disclosing publicly any information or data obtained by the
    Commission from a foreign futures authority when such disclosure is
    made in connection with a congressional proceeding, an
    administrative or judicial proceeding commenced by the United
    States or the Commission, in any receivership proceeding commenced
    involving a receiver appointed in a judicial proceeding by the
    United States or the Commission, or in any proceeding under title
    11 in which the Commission has intervened or in which the
    Commission has the right to appear and be heard. Nothing in this
    subsection shall be construed to authorize the Commission to
    withhold information or data from Congress. For purposes of section
    552 of title 5, this subsection shall be considered a statute
    described in subsection (b)(3)(B) of section 552.
      (2) In conducting investigations authorized under this subsection
    or any other provision of this chapter, the Commission shall
    continue, as the Commission determines necessary, to request the
    assistance of and cooperate with the appropriate Federal agencies
    in the conduct of such investigations, including undercover
    operations by such agencies. The Commission and the Department of
    Justice shall assess the effectiveness of such undercover
    operations and, within two years of October 28, 1992, shall
    recommend to Congress any additional undercover or other authority
    for the Commission that the Commission or the Department of Justice
    believes to be necessary.
      (3) The Commission shall provide the Securities and Exchange
    Commission with notice of the commencement of any proceeding and a
    copy of any order entered by the Commission against any futures
    commission merchant or introducing broker registered pursuant to
    section 6f(a)(2) of this title, any floor broker or floor trader
    exempt from registration pursuant to section 6f(a)(3) of this
    title, any associated person exempt from registration pursuant to
    section 6k(6) (!1) of this title, or any board of trade designated
    as a contract market pursuant to section 7b-1 of this title.

    (b) Business matters; congressional, administrative, judicial, and
      bankruptcy proceedings
      The Commission may disclose publicly any data or information that
    would separately disclose the market positions, business
    transactions, trade secrets, or names of customers of any person
    when such disclosure is made in connection with a congressional
    proceeding, in an administrative or judicial proceeding brought
    under this chapter, in any receivership proceeding involving a
    receiver appointed in a judicial proceeding brought under this
    chapter, or in any bankruptcy proceeding in which the Commission
    has intervened or in which the Commission has the right to appear
    and be heard under title 11. This subsection shall not apply to the
    disclosure of data or information obtained by the Commission from a
    foreign futures authority.
    (c) Reports respecting conduct of registered entities or
      transactions of violators; contents
      The Commission may make or issue such reports as it deems
    necessary, or such opinions or orders as may be required under
    other provisions of law, relative to the conduct of any registered
    entity or to the transactions of any person found guilty of
    violating the provisions of this chapter or the rules, regulations,
    or orders of the Commission thereunder in proceedings brought under
    sections 8, 9, 9a, 9b, 9c, 13b, and 15 of this title. In any such
    report or opinion, the Commission may set forth the facts as to any
    actual transaction or any information referred to in subsection (b)
    of this section, if such facts or information have previously been
    disclosed publicly in connection with a congressional proceeding,
    or in an administrative or judicial proceeding brought under this
    chapter.
    (d) Investigations respecting marketing conditions of commodities
      and commodity products and byproducts; reports
      The Commission, upon its own initiative or in cooperation with
    existing governmental agencies, shall investigate the marketing
    conditions of commodities and commodity products and byproducts,
    including supply and demand for these commodities, cost to the
    consumer, and handling and transportation charges. It shall also
    compile and furnish to producers, consumers, and distributors, by
    means of regular or special reports, or by such other methods as it
    deems most effective, information respecting the commodity markets,
    together with information on supply, demand, prices, and other
    conditions in this and other countries that affect the markets.
    (e) Names and addresses of traders of boards of trade previously
      disclosed; disclosure to Congress and agencies or departments of
      States or foreign governments or foreign futures authority
      The Commission may disclose and make public, where such
    information has previously been disclosed publicly in accordance
    with the provisions of this section, the names and addresses of all
    traders on the boards of trade on the commodity markets with
    respect to whom the Commission has information, and any other
    information in the possession of the Commission relating to the
    amount of commodities purchased or sold by each such trader. Upon
    the request of any committee of either House of Congress, acting
    within the scope of its jurisdiction, the Commission shall furnish
    to such committee the names and addresses of all traders on such
    boards of trade with respect to whom the Commission has
    information, and any other information in the possession of the
    Commission relating to the amount of any commodity purchased or
    sold by each such trader. Upon the request of any department or
    agency of the Government of the United States, acting within the
    scope of its jurisdiction, the Commission may furnish to such
    department or agency any information in the possession of the
    Commission obtained in connection with the administration of this
    chapter. However, any information furnished under this subsection
    to any Federal department or agency shall not be disclosed by such
    department or agency except in any action or proceeding under the
    laws of the United States to which it, the Commission, or the
    United States is a party. Upon the request of any department or
    agency of any State or any political subdivision thereof, acting
    within the scope of its jurisdiction, any foreign futures
    authority, or any department or agency of any foreign government or
    any political subdivision thereof, acting within the scope of its
    jurisdiction, the Commission may furnish to such foreign futures
    authority, department or agency any information in the possession
    of the Commission obtained in connection with the administration of
    this chapter. Any information furnished to any department or agency
    of any State or political subdivision thereof shall not be
    disclosed by such department or agency except in connection with an
    adjudicatory action or proceeding brought under this chapter or the
    laws of such State or political subdivision to which such State or
    political subdivision or any department or agency thereof is a
    party. The Commission shall not furnish any information to a
    foreign futures authority or to a department or agency of a foreign
    government or political subdivision thereof unless the Commission
    is satisfied that the information will not be disclosed by such
    foreign futures authority, department or agency except in
    connection with an adjudicatory action or proceeding brought under
    the laws of such foreign government or political subdivision to
    which such foreign government or political subdivision or any
    department or agency thereof, or foreign futures authority.(!2) is
    a party.

    (f) Compliance with subpoena after notice to informant;
      congressional subpoenas and requests for information excepted
      The Commission shall disclose information in its possession
    pursuant to a subpoena or summons only if - 
        (1) a copy of the subpoena or summons has been mailed to the
      last known home or business address of the person who submitted
      the information that is the subject of the subpoena or summons,
      if the address is known to the Commission, or, if such mailing
      would be unduly burdensome, the Commission provides other
      appropriate notice of the subpoena or summons to such person, and
        (2) at least fourteen days have expired from the date of such
      mailing of the subpoena or summons, or such other notice.

    This subsection shall not apply to congressional subpoenas or
    congressional requests for information.
    (g) Requests for information by State agencies or subdivisions;
      volunteering of information by Commission
      The Commission shall provide any registration information
    maintained by the Commission on any registrant upon reasonable
    request made by any department or agency of any State or any
    political subdivision thereof. Whenever the Commission determines
    that such information may be appropriate for use by any department
    or agency of a State or political subdivision thereof, the
    Commission shall provide such information without request.
    (h) Omitted
    (i) Review and audits by Comptroller General
      The Comptroller General of the United States shall conduct
    reviews and audits of the Commission and make reports thereon. For
    the purpose of conducting such reviews and audits, the Comptroller
    General shall be furnished such information regarding the powers,
    duties, organizations, transactions, operations, and activities of
    the Commission as the Comptroller General may require and the
    Comptroller General and the duly authorized representatives of the
    Comptroller General shall, for the purpose of securing such
    information, have access to and the right to examine any books,
    documents, papers, or records of the Commission, except that in
    reports the Comptroller General shall not include data and
    information that would separately disclose the business
    transactions of any person and trade secrets or names of customers,
    although such data shall be provided upon request by any committee
    of either House of Congress acting within the scope of its
    jurisdiction.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 8, 42 Stat. 1003; June 15, 1936, ch.
    545, Sec. 2, 49 Stat. 1491; Pub. L. 90-258, Sec. 19(a), Feb. 19,
    1968, 82 Stat. 32; Pub. L. 93-463, title I, Sec. 103(a), (e), Oct.
    23, 1974, 88 Stat. 1392; Pub. L. 95-405, Sec. 16, Sept. 30, 1978,
    92 Stat. 873; Pub. L. 97-444, title II, Sec. 222, Jan. 11, 1983, 96
    Stat. 2309; Pub. L. 102-546, title II, Sec. 205, title III, Secs.
    304, 305, title IV, Sec. 402(7), Oct. 28, 1992, 106 Stat. 3600,
    3623, 3624; Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(18), title II, Sec. 253(a)], Dec. 21, 2000, 114 Stat. 2763,
    2763A-410, 2763A-449.)

-COD-
                               CODIFICATION                           
      Section is based on section 8 of Act Sept. 21, 1922, as amended
    generally by Pub. L. 95-405, Sec. 16. Prior to such general
    amendment, section was comprised of the first paragraph of section
    8, and the second, third, and fourth pars. of section 8 were
    classified to sections 12-1, 12-2, and 12-3 of this title,
    respectively.
      Subsection (h), which required the Commodity Futures Trading
    Commission to submit an annual report to Congress detailing the
    operations of the Commission, terminated, effective May 15, 2000,
    pursuant to section 3003 of Pub. L. 104-66, as amended, set out as
    a note under section 1113 of Title 31, Money and Finance. See,
    also, page 158 of House Document No. 103-7.

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (a)(3). Pub. L. 106-554, Sec. 1(a)(5) [title II,
    Sec. 253(a)], added par. (3).
      Subsec. (c). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(18)], in first sentence, substituted "registered entity" for
    "board of trade".
      1992 - Subsec. (a). Pub. L. 102-546, Secs. 205, 304(1),
    designated existing provisions as par. (1), inserted provisions at
    end relating to disclosure of information received from foreign
    futures authorities, and added par. (2).
      Subsec. (b). Pub. L. 102-546, Sec. 304(2), inserted at end "This
    subsection shall not apply to the disclosure of data or information
    obtained by the Commission from a foreign futures authority."
      Subsec. (e). Pub. L. 102-546, Sec. 305, inserted references to
    foreign futures authority in fifth and last sentences.
      Subsec. (f). Pub. L. 102-546, Sec. 402(7), substituted "subpoena"
    for "subpena" wherever appearing and "subpoenas" for "subpenas" in
    last sentence.
      1983 - Subsec. (a). Pub. L. 97-444, Sec. 222(1), inserted proviso
    authorizing Commission to withhold from public disclosure any data
    or information concerning or obtained in connection with any
    pending investigation of any person.
      Subsec. (b). Pub. L. 97-444, Sec. 222(2), inserted references to
    receivership proceedings involving a receiver appointed in a
    judicial proceeding brought under this chapter and to bankruptcy
    proceedings in which the Commission has intervened or in which
    Commission has right to appear and be heard under title 11.
      Subsec. (e). Pub. L. 97-444, Sec. 222(3), struck out "of the
    Executive Branch" after "Upon the request of any department or
    agency" and inserted "Upon the request of any department or agency
    of any State or any political subdivision thereof, acting within
    the scope of its jurisdiction, or any department or agency of any
    foreign government or any political subdivision thereof, acting
    within the scope of its jurisdiction, the Commission may furnish to
    such department or agency any information in the possession of the
    Commission obtained in connection with the administration of this
    chapter. Any information furnished to any department or agency of
    any State or political subdivision thereof shall not be disclosed
    by such department or agency except in connection with an
    adjudicatory action or proceeding brought under this chapter or the
    laws of such State or political subdivision to which such State or
    political subdivision or any department or agency thereof is a
    party. The Commission shall not furnish any information to a
    department or agency of a foreign government or political
    subdivision thereof unless the Commission is satisfied that the
    information will not be disclosed by such department or agency
    except in connection with an adjudicatory action or proceeding
    brought under the laws of such foreign government or political
    subdivision to which such foreign government or political
    subdivision or any department or agency thereof is a party."
      Subsecs. (f), (g). Pub. L. 97-444, Sec. 222(5), added subsecs.
    (f) and (g). Former subsecs. (f) and (g) were redesignated (h) and
    (i), respectively.
      Subsecs. (h), (i). Pub. L. 97-444, Sec. 222(4), redesignated
    former subsecs. (f) and (g) as (h) and (i), respectively.
      1978 - Pub. L. 95-405 consolidated under this section provisions
    formerly contained in this section and sections 12-1, 12-2, and 12-
    3 of this title, generally revised provisions thus consolidated to
    clarify and expand disclosure to public of traders and their
    positions on boards of trade, and divided provisions thus
    consolidated and revised into subsecs. (a) to (g).
      1974 - Pub. L. 93-463 substituted "Commission" for "Secretary of
    Agriculture", "it" for "he", "its" for "his", and "It" for "He".
      1968 - Pub. L. 90-258 authorized investigations to ascertain
    facts regarding operations of other persons subject to any
    provisions of this chapter.
      1936 - Act June 15, 1936, substituted "commodity" for "grain"
    wherever appearing.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1968 AMENDMENT                 
      Amendment by Pub. L. 90-258 effective 120 days after Feb. 19,
    1968, see section 28 of Pub. L. 90-258, set out as a note under
    section 2 of this title.

                     EFFECTIVE DATE OF 1936 AMENDMENT                 
      Amendment by act June 15, 1936, effective 90 days after June 15,
    1936, see section 13 of act June 15, 1936, set out as a note under
    section 1 of this title.

-FOOTNOTE-
    (!1) So in original. Probably should refer to the second par. (5) of
         section 6k.

    (!2) So in original. The period probably should be a comma.

-End-

-CITE-
    7 USC Secs. 12-1 to 12-3                                    01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Secs. 12-1 to 12-3. Omitted

-COD-
                               CODIFICATION                           
      Sections 12-1 to 12-3 comprised the second, third, and fourth
    pars., respectively, of section 8 of the Commodity Exchange Act,
    Sept. 21, 1922, ch. 369, Sec. 8, 42 Stat. 1003. Such section 8 was
    amended generally by Pub. L. 95-405, Sec. 16, Sept. 30, 1978, 92
    Stat. 873, and is classified in its entirety to section 12 of this
    title.
      Section 12-1, as added Dec. 19, 1947, ch. 523, 61 Stat. 941;
    amended Feb. 19, 1968, Pub. L. 90-258, Sec. 19(b), 82 Stat. 32;
    Oct. 23, 1974, Pub. L. 93-463, title I, Sec. 103(a), (e), (f), 88
    Stat. 1392, related to disclosure of names of traders on commodity
    markets by Commission. See section 12(e) of this title.
      Section 12-2, as added Oct. 23, 1974, Pub. L. 93-463, title I,
    Sec. 105, 88 Stat. 1392, required an annual report to Congress. See
    Codification note under section 12 of this title.
      Section 12-3, as added Oct. 23, 1974, Pub. L. 93-463, title I,
    Sec. 105, 88 Stat. 1392, related to reviews and audits by
    Comptroller General. See section 12(i) of this title.

-End-

-CITE-
    7 USC Sec. 12a                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 12a. Registration of commodity dealers and associated persons;
      regulation of registered entities

-STATUTE-
      The Commission is authorized - 
        (1) to register futures commission merchants, associated
      persons of futures commission merchants, introducing brokers,
      associated persons of introducing brokers, commodity trading
      advisors, associated persons of commodity trading advisors,
      commodity pool operators, associated persons of commodity pool
      operators, floor brokers, and floor traders upon application in
      accordance with rules and regulations and in the form and manner
      to be prescribed by the Commission, which may require the
      applicant, and such persons associated with the applicant as the
      Commission may specify, to be fingerprinted and to submit, or
      cause to be submitted, such fingerprints to the Attorney General
      for identification and appropriate processing, and in connection
      therewith to fix and establish from time to time reasonable fees
      and charges for registrations and renewals thereof: Provided,
      That notwithstanding any provision of this chapter, the
      Commission may grant a temporary license to any applicant for
      registration with the Commission pursuant to such rules,
      regulations, or orders as the Commission may adopt, except that
      the term of any such temporary license shall not exceed six
      months from the date of its issuance;
        (2) upon notice, but without a hearing and pursuant to such
      rules, regulations, or orders as the Commission may adopt, to
      refuse to register, to register conditionally, or to suspend or
      place restrictions upon the registration of, any person and with
      such a hearing as may be appropriate to revoke the registration
      of any person - 
          (A) if a prior registration of such person in any capacity
        has been suspended (and the period of such suspension has not
        expired) or has been revoked;
          (B) if registration of such person in any capacity has been
        refused under the provisions of paragraph (3) of this section
        within five years preceding the filing of the application for
        registration or at any time thereafter;
          (C) if such person is permanently or temporarily enjoined by
        order, judgment, or decree of any court of competent
        jurisdiction (except that registration may not be revoked
        solely on the basis of such temporary order, judgment, or
        decree), including an order entered pursuant to an agreement of
        settlement to which the Commission or any Federal or State
        agency or other governmental body is a party, from (i) acting
        as a futures commission merchant, introducing broker, floor
        broker, floor trader, commodity trading advisor, commodity pool
        operator, associated person of any registrant under this
        chapter, securities broker, securities dealer, municipal
        securities broker, municipal securities dealer, transfer agent,
        clearing agency, securities information processor, investment
        adviser, investment company, or affiliated person or employee
        of any of the foregoing or (ii) engaging in or continuing any
        activity where such activity involves embezzlement, theft,
        extortion, fraud, fraudulent conversion, misappropriation of
        funds, securities or property, forgery, counterfeiting, false
        pretenses, bribery, gambling, or any transaction in or advice
        concerning contracts of sale of a commodity for future
        delivery, concerning matters subject to Commission regulation
        under section 6c or 23 of this title, or concerning securities;
          (D) if such person has been convicted within ten years
        preceding the filing of the application for registration or at
        any time thereafter of any felony that (i) involves any
        transactions or advice concerning any contract of sale of a
        commodity for future delivery, or any activity subject to
        Commission regulation under section 6c or 23 of this title, or
        concerning a security, (ii) arises out of the conduct of the
        business of a futures commission merchant, introducing broker,
        floor broker, floor trader, commodity trading advisor,
        commodity pool operator, associated person of any registrant
        under this chapter, securities broker, securities dealer,
        municipal securities broker, municipal securities dealer,
        transfer agent, clearing agency, securities information
        processor, investment adviser, investment company, or an
        affiliated person or employee of any of the foregoing, (iii)
        involves embezzlement, theft, extortion, fraud, fraudulent
        conversion, misappropriation of funds, securities or property,
        forgery, counterfeiting, false pretenses, bribery, or gambling,
        or (iv) involves the violation of section 152, 1001, 1341,
        1342, 1343, 1503, 1623, 1961, 1962, 1963, or 2314, or chapter
        25, 47, 95, or 96 of title 18, or section 7201 or 7206 of title
        26;
          (E) if such person, within ten years preceding the filing of
        the application or at any time thereafter, has been found in a
        proceeding brought by the Commission or any Federal or State
        agency or other governmental body, or by agreement of
        settlement to which the Commission or any Federal or State
        agency or other governmental body is a party, (i) to have
        violated any provision of this chapter, the Securities Act of
        1933 [15 U.S.C. 77a et seq.], the Securities Exchange Act of
        1934 [15 U.S.C. 78a et seq.], the Public Utility Holding
        Company Act of 1935,(!1) the Trust Indenture Act of 1939 [15
        U.S.C. 77aaa et seq.], the Investment Advisers Act of 1940 [15
        U.S.C. 80b-1 et seq.], the Investment Company Act of 1940 [15
        U.S.C. 80a-1 et seq.], the Securities Investors (!2) Protection
        Act of 1970 [15 U.S.C. 78aaa et seq.], the Foreign Corrupt
        Practices Act of 1977, chapter 96 of title 18, or any similar
        statute of a State or foreign jurisdiction, or any rule,
        regulation, or order under any such statutes, or the rules of
        the Municipal Securities Rulemaking Board where such violation
        involves embezzlement, theft, extortion, fraud, fraudulent
        conversion, misappropriation of funds, securities or property,
        forgery, counterfeiting, false pretenses, bribery, or gambling,
        or (ii) to have willfully aided, abetted, counseled, commanded,
        induced, or procured such violation by any other person;

          (F) if such person is subject to an outstanding order of the
        Commission denying privileges on any registered entity to such
        person, denying, suspending, or revoking such person's
        membership in any registered entity or registered futures
        association, or barring or suspending such person from being
        associated with a registrant under this chapter or with a
        member of a registered entity or with a member of a registered
        futures association;
          (G) if, as to any of the matters set forth in this paragraph
        and paragraph (3), such person willfully made any materially
        false or misleading statement or omitted to state any material
        fact in such person's application or any update thereto; or
          (H) if refusal, suspension, or revocation of the registration
        of any principal of such person would be warranted because of a
        statutory disqualification listed in this paragraph:

      Provided, That such person may appeal from a decision to refuse
      registration, condition registration, suspend, revoke or to place
      restrictions upon registration made pursuant to the provisions of
      this paragraph in the manner provided in sections 9 and 15 of
      this title; and
      Provided, further, That for the purposes of paragraphs (2) and
      (3) of this section, "principal" shall mean, if the person is a
      partnership, any general partner or, if the person is a
      corporation, any officer, director, or beneficial owner of at
      least 10 per centum of the voting shares of the corporation, and
      any other person that the Commission by rule, regulation, or
      order determines has the power, directly or indirectly, through
      agreement or otherwise, to exercise a controlling influence over
      the activities of such person which are subject to regulation by
      the Commission;
        (3) to refuse to register or to register conditionally any
      person, if it is found, after opportunity for hearing, that - 
          (A) such person has been found by the Commission or by any
        court of competent jurisdiction to have violated, or has
        consented to findings of a violation of, any provision of this
        chapter, or any rule, regulation, or order thereunder (other
        than a violation set forth in paragraph (2) of this section),
        or to have willfully aided, abetted, counseled, commanded,
        induced, or procured the violation by any other person of any
        such provision;
          (B) such person has been found by any court of competent
        jurisdiction or by any Federal or State agency or other
        governmental body, or by agreement of settlement to which any
        Federal or State agency or other governmental body is a party,
        (i) to have violated any provision of the Securities Act of
        1933 [15 U.S.C. 77a et seq.], the Securities Exchange Act of
        1934 [15 U.S.C. 78a et seq.], the Public Utility Holding
        Company Act of 1935,(!1) the Trust Indenture Act of 1939 [15
        U.S.C. 77aaa et seq.], the Investment Advisers Act of 1940 [15
        U.S.C. 80b-1 et seq.], the Investment Company Act of 1940 [15
        U.S.C. 80a-1 et seq.], the Securities Investors (!3) Protection
        Act of 1970 [15 U.S.C. 78aaa et seq.], the Foreign Corrupt
        Practices Act of 1977, or any similar statute of a State or
        foreign jurisdiction, or any rule, regulation, or order under
        any such statutes, or the rules of the Municipal Securities
        Rulemaking Board or (ii) to have willfully aided, abetted,
        counseled, commanded, induced, or procured such violation by
        any other person;

          (C) such person failed reasonably to supervise another
        person, who is subject to such person's supervision, with a
        view to preventing violations of this chapter, or of any of the
        statutes set forth in subparagraph (B) of this paragraph, or of
        any of the rules, regulations, or orders thereunder, and the
        person subject to supervision committed such a violation:
        Provided, That no person shall be deemed to have failed
        reasonably to supervise another person, within the meaning of
        this subparagraph if (i) there have been established
        procedures, and a system for applying such procedures, which
        would reasonably be expected to prevent and detect, insofar as
        practicable, any such violation by such other person and (ii)
        such person has reasonably discharged the duties and
        obligations incumbent upon that person, as supervisor, by
        reason of such procedures and system, without reasonable cause
        to believe that such procedures and system were not being
        complied with;
          (D) such person pleaded guilty to or was convicted of a
        felony other than a felony of the type specified in paragraph
        (2)(D) of this section, or was convicted of a felony of the
        type specified in paragraph (2)(D) of this section more than
        ten years preceding the filing of the application;
          (E) such person pleaded guilty to or was convicted of any
        misdemeanor which (i) involves any transaction or advice
        concerning any contract of sale of a commodity for future
        delivery or any activity subject to Commission regulation under
        section 6c or 23 of this title or concerning a security, (ii)
        arises out of the conduct of the business of a futures
        commission merchant, introducing broker, floor broker, floor
        trader, commodity trading advisor, commodity pool operator,
        associated person of any registrant under this chapter,
        securities broker, securities dealer, municipal securities
        broker, municipal securities dealer, transfer agent, clearing
        agency, securities information processor, investment adviser,
        investment company, or an affiliated person or employee of any
        of the foregoing, (iii) involves embezzlement, theft,
        extortion, fraud, fraudulent conversion, misappropriation of
        funds, securities or property, forgery, counterfeiting, false
        pretenses, bribery, or gambling, (iv) involves the violation of
        section 152, 1341, 1342, or 1343 or chapter 25, 47, 95, or 96
        of title 18, or section 7203, 7204, 7205, or 7207 of title 26;
          (F) such person was debarred by any agency of the United
        States from contracting with the United States;
          (G) such person willfully made any materially false or
        misleading statement or willfully omitted to state any material
        fact in such person's application or any update thereto, in any
        report required to be filed with the Commission by this chapter
        or the regulations thereunder, in any proceeding before the
        Commission or in any registration disqualification proceeding;
          (H) such person has pleaded nolo contendere to criminal
        charges of felonious conduct, or has been convicted in a State
        court, in a United States military court, or in a foreign court
        of conduct which would constitute a felony under Federal law if
        the offense had been committed under Federal jurisdiction;
          (I) in the case of an applicant for registration in any
        capacity for which there are minimum financial requirements
        prescribed under this chapter or under the rules or regulations
        of the Commission, such person has not established that such
        person meets such minimum financial requirements;
          (J) such person is subject to an outstanding order denying,
        suspending, or expelling such person from membership in a
        registered entity, a registered futures association, any other
        self-regulatory organization, or any foreign regulatory body
        that the Commission recognizes as having a comparable
        regulatory program or barring or suspending such person from
        being associated with any member or members of such registered
        entity, association, self-regulatory organization, or foreign
        regulatory body;
          (K) such person has been found by any court of competent
        jurisdiction or by any Federal or State agency or other
        governmental body, or by agreement of settlement to which any
        Federal or State agency or other governmental body is a party,
        (i) to have violated any statute or any rule, regulation, or
        order thereunder which involves embezzlement, theft, extortion,
        fraud, fraudulent conversion, misappropriation of funds,
        securities or property, forgery, counterfeiting, false
        pretenses, bribery, or gambling or (ii) to have willfully
        aided, abetted, counseled, commanded, induced or procured such
        violation by any other person;
          (L) such person has associated with such person any other
        person and knows, or in the exercise of reasonable care should
        know, of facts regarding such other person that are set forth
        as statutory disqualifications in paragraph (2) of this
        section, unless such person has notified the Commission of such
        facts and the Commission has determined that such other person
        should be registered or temporarily licensed;
          (M) there is other good cause; or
          (N) any principal, as defined in paragraph (2) of this
        section, of such person has been or could be refused
        registration:

      Provided, That pending final determination under this paragraph,
      registration shall not be granted: Provided further, That such
      person may appeal from a decision to refuse registration or to
      condition registration made pursuant to this paragraph in the
      manner provided in sections 9 and 15 of this title;
        (4) in accordance with the procedure provided for in sections 9
      and 15 of this title, to suspend, revoke, or place restrictions
      upon the registration of any person registered under this chapter
      if cause exists under paragraph (3) of this section which would
      warrant a refusal of registration of such person, and to suspend
      or revoke the registration of any futures commission merchant or
      introducing broker who shall knowingly accept any order for the
      purchase or sale of any commodity for future delivery on or
      subject to the rules of any registered entity from any person if
      such person has been denied trading privileges on any registered
      entity by order of the Commission under sections 9 and 15 of this
      title and the period of denial specified in such order shall not
      have expired: Provided, That such person may appeal from a
      decision to suspend, revoke, or place restrictions upon
      registration made pursuant to this paragraph in the manner
      provided in sections 9 and 15 of this title;
        (5) to make and promulgate such rules and regulations as, in
      the judgment of the Commission, are reasonably necessary to
      effectuate any of the provisions or to accomplish any of the
      purposes of this chapter;
        (6) to communicate to the proper committee or officer of any
      registered entity, registered futures association, or self-
      regulatory organization as defined in section 3(a)(26) of the
      Securities Exchange Act of 1934 [15 U.S.C. 78c(a)(26)],
      notwithstanding the provisions of section 12 of this title, the
      full facts concerning any transaction or market operation,
      including the names of parties thereto, which in the judgment of
      the Commission disrupts or tends to disrupt any market or is
      otherwise harmful or against the best interests of producers,
      consumers, or investors, or which is necessary or appropriate to
      effectuate the purposes of this chapter: Provided, That any
      information furnished by the Commission under this paragraph
      shall not be disclosed by such registered entity, registered
      futures association, or self-regulatory organization except in
      any self-regulatory action or proceeding;
        (7) to alter or supplement the rules of a registered entity
      insofar as necessary or appropriate by rule or regulation or by
      order, if after making the appropriate request in writing to a
      registered entity that such registered entity effect on its own
      behalf specified changes in its rules and practices, and after
      appropriate notice and opportunity for hearing, the Commission
      determines that such registered entity has not made the changes
      so required, and that such changes are necessary or appropriate
      for the protection of persons producing, handling, processing, or
      consuming any commodity traded for future delivery on such
      registered entity, or the product or byproduct thereof, or for
      the protection of traders or to insure fair dealing in
      commodities traded for future delivery on such registered entity.
      Such rules, regulations, or orders may specify changes with
      respect to such matters as - 
          (A) terms or conditions in contracts of sale to be executed
        on or subject to the rules of such registered entity;
          (B) the form or manner of execution of purchases and sales
        for future delivery;
          (C) other trading requirements, excepting the setting of
        levels of margin;
          (D) safeguards with respect to the financial responsibility
        of members;
          (E) the manner, method, and place of soliciting business,
        including the content of such solicitations; and
          (F) the form and manner of handling, recording, and
        accounting for customers' orders, transactions, and accounts;

        (8) to make and promulgate such rules and regulations with
      respect to those persons registered under this chapter, who are
      not members of a registered entity, as in the judgment of the
      Commission are reasonably necessary to protect the public
      interest and promote just and equitable principles of trade,
      including but not limited to the manner, method, and place of
      soliciting business, including the content of such solicitation;
        (9) to direct the registered entity, whenever it has reason to
      believe that an emergency exists, to take such action as in the
      Commission's judgment is necessary to maintain or restore orderly
      trading in or liquidation of any futures contract, including, but
      not limited to, the setting of temporary emergency margin levels
      on any futures contract, and the fixing of limits that may apply
      to a market position acquired in good faith prior to the
      effective date of the Commission's action. The term "emergency"
      as used herein shall mean, in addition to threatened or actual
      market manipulations and corners, any act of the United States or
      a foreign government affecting a commodity or any other major
      market disturbance which prevents the market from accurately
      reflecting the forces of supply and demand for such commodity.
      Any action taken by the Commission under this paragraph shall be
      subject to review only in the United States Court of Appeals for
      the circuit in which the party seeking review resides or has its
      principal place of business, or in the United States Court of
      Appeals for the District of Columbia Circuit. Such review shall
      be based upon an examination of all the information before the
      Commission at the time the determination was made. The court
      reviewing the Commission's action shall not enter a stay or order
      of mandamus unless it has determined, after notice and hearing
      before a panel of the court, that the agency action complained of
      was arbitrary, capricious, an abuse of discretion, or otherwise
      not in accordance with law. Nothing herein shall be deemed to
      limit the meaning or interpretation given by a registered entity
      to the terms "market emergency", "emergency", or equivalent
      language in its own bylaws, rules, regulations, or resolutions;
        (10) to authorize any person to perform any portion of the
      registration functions under this chapter, in accordance with
      rules, notwithstanding any other provision of law, adopted by
      such person and submitted to the Commission for approval or, if
      applicable, for review pursuant to section 21(j) of this title,
      and subject to the provisions of this chapter applicable to
      registrations granted by the Commission; and
        (11)(A) by written notice served on the person and pursuant to
      such rules, regulations, and orders as the Commission may adopt,
      to suspend or modify the registration of any person registered
      under this chapter who is charged (in any information,
      indictment, or complaint authorized by a United States attorney
      or an appropriate official of any State) with the commission of
      or participation in a crime involving a violation of this
      chapter, or a violation of any other provision of Federal or
      State law that would reflect on the honesty or the fitness of the
      person to act as a fiduciary (including an offense specified in
      subparagraph (D) or (E) of paragraph (2)) that is punishable by
      imprisonment for a term exceeding one year, if the Commission
      determines that continued registration of the person may pose a
      threat to the public interest or may threaten to impair public
      confidence in any market regulated by the Commission.
        (B) Prior to the suspension or modification of the registration
      of a person under this paragraph, the person shall be afforded an
      opportunity for a hearing at which the Commission shall have the
      burden of showing that the continued registration of the person
      does, or is likely to, pose a threat to the public interest or
      threaten to impair public confidence in any market regulated by
      the Commission.
        (C) Any notice of suspension or modification issued under this
      paragraph shall remain in effect until such information,
      indictment, or complaint is disposed of or until terminated by
      the Commission.
        (D) On disposition of such information, indictment, or
      complaint, the Commission may issue and serve on such person an
      order pursuant to paragraph (2) or (4) to suspend, restrict, or
      revoke the registration of such person.
        (E) A finding of not guilty or other disposition of the charge
      shall not preclude the Commission from thereafter instituting any
      other proceedings under this chapter.
        (F) A person aggrieved by an order issued under this paragraph
      may obtain review of such order in the same manner and on the
      same terms and conditions as are provided in section 8(b) of this
      title.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 8a, as added June 15, 1936, ch. 545,
    Sec. 10, 49 Stat. 1500; amended Aug. 5, 1955, ch. 574, 69 Stat.
    535; Pub. L. 90-258, Secs. 20-23, Feb. 19, 1968, 82 Stat. 32, 33;
    Pub. L. 93-463, title I, Sec. 103(a), title II, Secs. 204(c),
    205(c), 213-215, Oct. 23, 1974, 88 Stat. 1392, 1397, 1400, 1404;
    Pub. L. 95-405, Sec. 17, Sept. 30, 1978, 92 Stat. 874; Pub. L. 97-
    444, title I, Sec. 104, title II, Secs. 223-225, Jan. 11, 1983, 96
    Stat. 2297, 2310-2315; Pub. L. 102-546, title II, Secs. 207(b)(3),
    (4), 208, 209(b)(6), 227, title IV, Sec. 402(10), Oct. 28, 1992,
    106 Stat. 3604, 3607, 3618, 3625; Pub. L. 106-554, Sec. 1(a)(5)
    [title I, Sec. 123(a)(19)], Dec. 21, 2000, 114 Stat. 2763, 2763A-
    410.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Securities Act of 1933, referred to in pars. (2)(E) and
    (3)(B), is title I of act May 27, 1933, ch. 38, 48 Stat. 74, as
    amended, which is classified generally to subchapter I (Sec. 77a et
    seq.) of chapter 2A of Title 15, Commerce and Trade. For complete
    classification of this Act to the Code, see section 77a of Title 15
    and Tables.
      The Securities Exchange Act of 1934, referred to in pars. (2)(E)
    and (3)(B), is act June 6, 1934, ch. 404, 48 Stat. 881, as amended,
    which is classified principally to chapter 2B (Sec. 78a et seq.) of
    Title 15. For complete classification of this Act to the Code, see
    section 78a of Title 15 and Tables.
      The Public Utility Holding Company Act of 1935, referred to in
    pars. (2)(E) and (3)(B), is title I of act Aug. 26, 1935, ch. 687,
    49 Stat. 803, as amended, which was classified generally to chapter
    2C (Sec. 79 et seq.) of Title 15, Commerce and Trade, prior to
    repeal by Pub. L. 109-58, title XII, Sec. 1263, Aug. 8, 2005, 119
    Stat. 974. For complete classification of this Act to the Code, see
    Tables.
      The Trust Indenture Act of 1939, referred to in pars. (2)(E) and
    (3)(B), is title III of act May 27, 1933, ch. 38, as added Aug. 3,
    1939, ch. 411, 53 Stat. 1149, as amended, which is classified
    generally to subchapter III (Sec. 77aaa et seq.) of chapter 2A of
    Title 15. For complete classification of this Act to the Code, see
    section 77aaa of Title 15 and Tables.
      The Investment Advisers Act of 1940, referred to in pars. (2)(E)
    and (3)(B), is title II of act Aug. 22, 1940, ch. 686, 54 Stat.
    847, as amended, which is classified generally to subchapter II
    (Sec. 80b-1 et seq.) of chapter 2D of Title 15. For complete
    classification of this Act to the Code, see section 80b-20 of Title
    15 and Tables.
      The Investment Company Act of 1940, referred to in pars. (2)(E)
    and (3)(B), is title I of act Aug. 22, 1940, ch. 686, 54 Stat. 789,
    as amended, which is classified generally to subchapter I (Sec. 80a-
    1 et seq.) of chapter 2D of Title 15. For complete classification
    of this Act to the Code, see section 80a-51 of Title 15 and Tables.
      The Securities Investor Protection Act of 1970, referred to in
    pars. (2)(E) and (3)(B), is Pub. L. 91-598, Dec. 30, 1970, 84 Stat.
    1636, as amended, which is classified generally to chapter 2B-1
    (Sec. 78aaa et seq.) of Title 15. For complete classification of
    this Act to the Code, see section 78aaa of Title 15 and Tables.
      The Foreign Corrupt Practices Act of 1977, referred to in pars.
    (2)(E) and (3)(B), is title I of Pub. L. 95-213, Dec. 19, 1977, 91
    Stat. 1494, as amended, which enacted sections 78dd-1 to 78dd-3 of
    Title 15, Commerce and Trade, and amended sections 78m and 78ff of
    Title 15. For complete classification of this Act to the Code, see
    Short Title of 1977 Amendment note set out under section 78a of
    Title 15 and Tables.

-MISC1-
                                AMENDMENTS                            
      2000 - Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(19)(A)], substituted "registered entity" for "contract
    market" wherever appearing.
      Par. (2)(F). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(19)(B)], substituted "privileges" for "trading privileges".
      1992 - Par. (1). Pub. L. 102-546, Sec. 207(b)(3), substituted
    "floor brokers, and floor traders" for "and floor brokers".
      Par. (2). Pub. L. 102-546, Sec. 209(b)(6)(A), made technical
    amendment to reference to sections 9 and 15 of this title in
    concluding provisions to reflect change in reference to
    corresponding section of original act.
      Par. (2)(C)(i). Pub. L. 102-546, Sec. 207(b)(4), inserted "floor
    trader," after "floor broker,".
      Par. (2)(C)(ii). Pub. L. 102-546, Sec. 208(a), amended cl. (ii)
    generally. Prior to amendment, cl. (ii) read as follows: "engaging
    in or continuing any activity involving any transaction in or
    advice concerning contracts of sale of a commodity for future
    delivery, concerning matters subject to Commission regulation under
    section 6c or 23 of this title, or concerning securities".
      Par. (2)(D)(ii). Pub. L. 102-546, Sec. 207(b)(4), inserted "floor
    trader," after "floor broker,".
      Par. (2)(D)(iv). Pub. L. 102-546, Sec. 208(b), inserted
    references to sections 1001, 1503, 1623, 1961 to 1963, and 2314 of
    title 18 and sections 7201 and 7206 of title 26.
      Par. (2)(E). Pub. L. 102-546, Sec. 208(c), substituted "in a
    proceeding brought" for "by any court of competent jurisdiction,"
    and in cl. (i) inserted reference to chapter 96 of title 18.
      Par. (2)(G). Pub. L. 102-546, Sec. 208(d), substituted "this
    paragraph and paragraph (3)" for "subparagraphs (A) through (F) of
    this paragraph", "materially false" for "material false", and
    "application or any update thereto" for "application".
      Par. (3). Pub. L. 102-546, Sec. 209(b)(6)(B), made technical
    amendment to reference to sections 9 and 15 of this title in
    concluding provisions to reflect change in reference to
    corresponding section of original act.
      Par. (3)(D). Pub. L. 102-546, Sec. 208(e), inserted "pleaded
    guilty to or" after "person", substituted "section," for "section
    within ten years preceding the filing of the application or at any
    time thereafter," and "felony of the type specified in paragraph
    (2)(D) of this section more" for "felony, including a felony of the
    type specified in paragraph (2)(D) of this section, more".
      Par. (3)(E). Pub. L. 102-546, Sec. 208(f)(1), (2), inserted
    "pleaded guilty to or" after "person" and struck out "within ten
    years preceding the filing of the application for registration or
    at any time thereafter" before "of any misdemeanor".
      Par. (3)(E)(ii). Pub. L. 102-546, Sec. 207(b)(4), inserted "floor
    trader," after "floor broker,".
      Par. (3)(E)(iv). Pub. L. 102-546, Sec. 208(f)(3), inserted
    reference to sections 7203 to 7205 and 7207 of title 26.
      Par. (3)(G). Pub. L. 102-546, Sec. 208(g)(5), which directed the
    insertion of "or in any registration disqualification proceeding"
    after "Commission", was executed by making the insertion after
    "Commission" the second time it appeared to reflect the probable
    intent of Congress.
      Pub. L. 102-546, Sec. 208(g)(1)-(4), substituted "materially
    false" for "material false", "application or any update thereto,"
    for "application," and struck out "or" after "thereunder,".
      Par. (3)(H). Pub. L. 102-546, Sec. 208(h), inserted ", in a
    United States military court," after "State court".
      Par. (3)(J). Pub. L. 102-546, Sec. 208(i), struck out "or" before
    "any other self-regulatory", inserted "or any foreign regulatory
    body that the Commission recognizes as having a comparable
    regulatory program", and substituted "association, self-regulatory
    organization, or foreign regulatory body" for "association, or self-
    regulatory organization".
      Par. (4). Pub. L. 102-546, Sec. 209(b)(6)(C), made technical
    amendment to references to sections 9 and 15 of this title in
    concluding provisions to reflect change in references to
    corresponding section of original act.
      Par. (5). Pub. L. 102-546, Sec. 402(10)(A), struck out "and" at
    end.
      Par. (7). Pub. L. 102-546, Sec. 402(10)(B), substituted "matters
    as - " for "matters as:" in introductory provisions.
      Par. (11). Pub. L. 102-546, Sec. 227, added par. (11).
      1983 - Par. (1). Pub. L. 97-444, Sec. 223, substituted
    authorization for registration of "associated persons of futures
    commission merchants" for "and persons associated therewith as
    described in section 6k of this title"; authorized registration of
    introducing brokers, associated persons of introducing brokers,
    associated persons of commodity trading advisors and associated
    persons of commodity pool operators, substituted "such persons" for
    "any persons" before "associated with the applicant", and
    authorized establishment of registration and renewal fees and
    charges and granting of temporary licenses for terms not exceeding
    six months from date of issuance.
      Par. (2). Pub. L. 97-444, Sec. 224(1), added par. (2) and struck
    out prior par. (2) which authorized Commission "to refuse to
    register any person - 
        "(A) if the prior registration of such person has been
      suspended (and the period of such suspension shall not have
      expired) or has been revoked;
        "(B) if it is found, after opportunity for hearing, that the
      applicant is unfit to engage in the business for which the
      application for registration is made, (i) because such applicant,
      or, if the applicant is a partnership, any general partner, or,
      if the applicant is a corporation, any officer or holder of more
      than 10 per centum of the stock, at any time engaged in any
      practice of the character prohibited by this chapter or was
      convicted of a felony in any State or Federal court, or was
      debarred by any agency of the United States from contracting with
      the United States, or the applicant willfully made any material
      false or misleading statement in his application or willfully
      omitted to state any material fact in connection with the
      application, or (ii) for other good cause shown; or
        "(C) in the case of an applicant for registration as futures
      commission merchant, if it is found after opportunity for hearing
      that the applicant has not established that he meets the minimum
      financial requirements under section 6f of this title: Provided,
      That pending final determination under subparagraph (B) or (C),
      registration shall not be granted: And provided further, That the
      applicant may appeal from the refusal of registration under
      subparagraph (B) or (C) in the manner provided in sections 9 and
      15 of this title; and".
      Par. (3). Pub. L. 97-444, Sec. 224(3), added par. (3). Former
    par. (3) redesignated (4).
      Par. (4). Pub. L. 97-444, Sec. 224(2), (4), struck out par. (4)
    provision for establishment of registration and renewal fees and
    charges, covered in par. (1), redesignated par. (3) as (4), and in
    redesignated par. (4), authorized placing of restrictions on
    registrations, suspension or revocation of registration of an
    introducing broker and appeals from registration decisions made
    pursuant to this paragraph as provided in sections 9 and 15 of this
    title, and substituted "if cause exists under paragraph (3) of this
    section" for "if cause exists under paragraph (2)(B) or (C) of this
    section".
      Par. (6). Pub. L. 97-444, Sec. 104, authorized communication of
    full facts respecting transactions or market operations to
    registered futures associations and self-regulatory organizations,
    included concern for investors, provided for communications when
    necessary or appropriate to effectuate purposes of this chapter,
    and prohibited disclosure of furnished information except in self-
    regulatory actions or proceedings.
      Pars. (6) to (8). Pub. L. 97-444, Sec. 224(5), struck out "and"
    at end of pars. (6), (7), and (8).
      Par. (9). Pub. L. 97-444, Sec. 225, authorized Commission to
    direct the contract market to take certain action, including, but
    not limited to, setting of temporary emergency margin levels on any
    futures contract, and fixing of limits that may apply to a market
    position acquired in good faith prior to the effective date of
    Commission's action and inserted provisions respecting judicial
    review.
      Par. (10). Pub. L. 97-444, Sec. 224(6), added par. (10).
      1978 - Par. (1). Pub. L. 95-405, Sec. 17(1), inserted ", which
    may require the applicant, and any persons associated with the
    applicant as the Commission may specify, to be fingerprinted and to
    submit, or cause to be submitted, such fingerprints to the Attorney
    General for identification and appropriate processing" after "by
    the Commission".
      Par. (6). Pub. L. 95-405, Sec. 17(2), struck out "and to publish"
    after "any contract market".
      1974 - Pub. L. 93-463, Sec. 103(a), substituted "Commission" for
    "Secretary of Agriculture" in provisions preceding par. (1).
      Par. (1). Pub. L. 93-463, Secs. 103(a), 204(c), 205(c),
    substituted "Commission" for "Secretary of Agriculture", inserted
    "and persons associated therewith as described in section 6k of
    this title," after "futures commission merchants", and inserted
    "commodity trading advisors, commodity pool operators" before "and
    floor brokers".
      Pars. (3), (5), (6). Pub. L. 93-463, Sec. 103(a), substituted
    "Commission" for "Secretary of Agriculture".
      Par. (7). Pub. L. 93-463, Sec. 213, amended par. (7) generally,
    substituting provisions covering the altering or supplementing of
    the rules of a contract market for provisions covering the
    disapproval of bylaws, rules, regulations, and resolutions made,
    issued, or proposed by a contract market.
      Par. (8). Pub. L. 93-463, Sec. 214, added par. (8).
      Par. (9). Pub. L. 93-463, Sec. 215, added par. (9).
      1968 - Par. (2). Pub. L. 90-258, Sec. 20, designated existing
    provisions as subpar. (A), substituted "if the prior registration
    of such person" for "if such person has violated any of the
    provisions of this chapter or any of the rules or regulations
    promulgated by the Secretary of Agriculture hereunder for which the
    registration of such person" and added subpars. (B) and (C).
      Par. (3). Pub. L. 90-258, Sec. 21, authorized Secretary of
    Agriculture, in accordance with procedure provided for in sections
    9 and 15 of this title, to suspend or revoke the registration of
    any person registered under this chapter if cause exists under par.
    (2)(B) or (C) of this section which would warrant a refusal of
    registration of such person.
      Par. (4). Pub. L. 90-258, Sec. 22, struck out authorization for
    establishment of fees for copies of registration certificates.
      Par. (7). Pub. L. 90-258, Sec. 23, added par. (7).
      1955 - Par. (4). Act Aug. 5, 1955, authorized Secretary to fix
    and establish reasonable fees for registrations and renewals, and
    struck out provisions which set the fee for each registration and
    renewal at not more than $10.

                     EFFECTIVE DATE OF 1992 AMENDMENT                 
      Amendment by section 207(b)(3), (4) of Pub. L. 102-546 effective
    180 days after Oct. 28, 1992, with Commodity Futures Trading
    Commission to issue any regulations necessary to implement such
    amendment no later than 180 days after Oct. 28, 1992, see section
    207(c) of Pub. L. 102-546, set out as a note under section 6e of
    this title.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1968 AMENDMENT                 
      Amendment by Pub. L. 90-258 effective 120 days after Feb. 19,
    1968, see section 28 of Pub. L. 90-258, set out as a note under
    section 2 of this title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 13 of act June 15,
    1936, set out as an Effective Date of 1936 Amendment note under
    section 1 of this title.

-FOOTNOTE-
    (!1) See References in Text note below.

    (!2) So in original. Probably should be "Investor".

    (!3) So in original. Probably should be "Investor".

-End-

-CITE-
    7 USC Sec. 12b                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 12b. Trading ban violations; prohibition

-STATUTE-
      It shall be unlawful for any person, against whom there is
    outstanding any order of the Commission prohibiting him from
    trading on or subject to the rules of any registered entity, to
    make or cause to be made in contravention of such order, any
    contract for future delivery of any commodity, on or subject to the
    rules of any registered entity.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 8b, as added Pub. L. 90-258, Sec.
    24, Feb. 19, 1968, 82 Stat. 33; amended Pub. L. 93-463, title I,
    Sec. 103(a), Oct. 23, 1974, 88 Stat. 1392; Pub. L. 106-554, Sec.
    1(a)(5) [title I, Sec. 123(a)(20)], Dec. 21, 2000, 114 Stat. 2763,
    2763A-410.)

-MISC1-
                                AMENDMENTS                            
      2000 - Pub. L. 106-554 substituted "registered entity" for
    "contract market" in two places.
      1974 - Pub. L. 93-463 substituted "Commission" for "Secretary of
    Agriculture".

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463 see section 418
    of Pub. L. 93-463, set out as a note under section 2 of this title.

                              EFFECTIVE DATE                          
      Section effective 120 days after Feb. 19, 1968, see section 28 of
    Pub. L. 90-258, set out as an Effective Date of 1968 Amendment note
    under section 2 of this title.

-End-

-CITE-
    7 USC Sec. 12c                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 12c. Disciplinary actions

-STATUTE-
    (a) Action taken; written notice of reasons for action
      (1) Any exchange or the Commission if the exchange fails to act,
    may suspend, expel, or otherwise discipline any person who is a
    member of that exchange, or deny any person access to the exchange.
    Any such action shall be taken solely in accordance with the rules
    of that exchange.
      (2) Any suspension, expulsion, disciplinary, or access denial
    procedure established by an exchange rule shall provide for written
    notice to the Commission and to the person who is suspended,
    expelled, or disciplined, or denied access, within thirty days,
    which includes the reasons for the exchange action in the form and
    manner the Commission prescribes. An exchange shall make public its
    findings and the reasons for the exchange action in any such
    proceeding, including the action taken or the penalty imposed, but
    shall not disclose the evidence therefor, except to the person who
    is suspended, expelled, or disciplined, or denied access, and to
    the Commission.
    (b) Review by Commission
      The Commission may, in its discretion and in accordance with such
    standards and procedures as it deems appropriate, review any
    decision by an exchange whereby a person is suspended, expelled,
    otherwise disciplined, or denied access to the exchange. In
    addition, the Commission may, in its discretion and upon
    application of any person who is adversely affected by any other
    exchange action, review such action.
    (c) Affirmance, modification, set aside, or remand of action
      The Commission may affirm, modify, set aside, or remand any
    exchange decision it reviews pursuant to subsection (b) of this
    section, after a determination on the record whether the action of
    the exchange was in accordance with the policies of this chapter.
    Subject to judicial review, any order of the Commission entered
    pursuant to subsection (b) of this section shall govern the
    exchange in its further treatment of the matter.
    (d) Stay of action
      The Commission, in its discretion, may order a stay of any action
    taken pursuant to subsection (a) of this section pending review
    thereof.
    (e) Major disciplinary rule violations
      (1) The Commission shall issue regulations requiring each
    registered entity to establish and make available to the public a
    schedule of major violations of any rule within the disciplinary
    jurisdiction of such registered entity.
      (2) The regulations issued by the Commission pursuant to this
    subsection shall prohibit, for a period of time to be determined by
    the Commission, any individual who is found to have committed any
    major violation from service on the governing board of any
    registered entity or registered futures association, or on any
    disciplinary committee thereof.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 8c, as added Pub. L. 93-463, title
    II, Sec. 216, Oct. 23, 1974, 88 Stat. 1405; amended Pub. L. 95-405,
    Sec. 18, Sept. 30, 1978, 92 Stat. 874; Pub. L. 102-546, title II,
    Sec. 206(a)(2), Oct. 28, 1992, 106 Stat. 3602; Pub. L. 106-554,
    Sec. 1(a)(5) [title I, Sec. 123(a)(20)], Dec. 21, 2000, 114 Stat.
    2763, 2763A-410.)

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (e). Pub. L. 106-554 substituted "registered
    entity" for "contract market" wherever appearing.
      1992 - Pub. L. 102-546 redesignated pars. (1) to (4) as subsecs.
    (a) to (d), respectively, in subsec. (a) redesignated subpars. (A)
    and (B) as pars. (1) and (2), respectively, in subsec. (c)
    substituted references to subsection (b) for references to
    paragraph (2), in subsec. (d) substituted reference to subsection
    (a) for reference to paragraph (1), and added subsec. (e).
      1978 - Par. (1)(B). Pub. L. 95-405 substituted "An exchange shall
    make public its findings and the reasons for the exchange action in
    any such proceeding, including the action taken or the penalty
    imposed, but shall not disclose the evidence therefor, except to
    the person who is suspended, expelled, or disciplined or denied
    access, and to the Commission" for "Otherwise the notice and
    reasons shall be kept confidential".

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 418 of Pub. L. 93-463,
    set out as an Effective Date of 1968 Amendment note under section 2
    of this title.

-End-

-CITE-
    7 USC Sec. 12d                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 12d. Commission action for noncompliance with export sales
      reporting requirements

-STATUTE-
      The Commission may, in accordance with the procedures provided
    for in this chapter, refuse to register, register conditionally, or
    suspend, place restrictions upon, or revoke the registration of,
    any person, and may bar for any period as it deems appropriate any
    person from using or participating in any manner in any market
    regulated by the Commission, if such person is subject to a final
    decision or order of any court of competent jurisdiction or agency
    of the United States finding such person to have knowingly violated
    any provision of the export sales reporting requirements of section
    612c-3 (!1) of this title, or of any regulation issued thereunder.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 8d, as added Pub. L. 97-444, title
    II, Sec. 226, Jan. 11, 1983, 96 Stat. 2316.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      Section 612c-3 of this title, referred to in text, was repealed
    by Pub. L. 101-624, title XV, Sec. 1578, Nov. 28, 1990, 104 Stat.
    3702.

-MISC1-
                              EFFECTIVE DATE                          
      Section effective Jan. 11, 1983, see section 239 of Pub. L. 97-
    444, set out as an Effective Date of 1983 Amendment note under
    section 2 of this title.

-FOOTNOTE-
    (!1) See References in Text note below.

-End-

-CITE-
    7 USC Sec. 12e                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 12e. Repealed.

-MISC1-
    Sec. 12e. Repealed. Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
      123(a)(21)], Dec. 21, 2000, 114 Stat. 2763, 2763A-410.
      Section, act Sept. 21, 1922, ch. 369, Sec. 8e, as added Pub. L.
    102-546, title II, Sec. 202(a), Oct. 28, 1992, 106 Stat. 3598,
    related to Commission oversight and deficiency orders.

-End-

-CITE-
    7 USC Sec. 13                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 13. Violations generally; punishment; costs of prosecution

-STATUTE-
    (a) Felonies generally
      It shall be a felony punishable by a fine of not more than
    $1,000,000 (or $500,000 in the case of a person who is an
    individual) or imprisonment for not more than five years, or both,
    together with the costs of prosecution, for:
        (1) Any person registered or required to be registered under
      this chapter, or any employee or agent thereof, to embezzle,
      steal, purloin, or with criminal intent convert to such person's
      use or to the use of another, any money, securities, or property
      having a value in excess of $100, which was received by such
      person or any employee or agent thereof to margin, guarantee, or
      secure the trades or contracts of any customer or accruing to
      such customer as a result of such trades or contracts or which
      otherwise was received from any customer, client, or pool
      participant in connection with the business of such person. The
      word "value" as used in this paragraph means face, par, or market
      value, or cost price, either wholesale or retail, whichever is
      greater.
        (2) Any person to manipulate or attempt to manipulate the price
      of any commodity in interstate commerce, or for future delivery
      on or subject to the rules of any registered entity, or to corner
      or attempt to corner any such commodity or knowingly to deliver
      or cause to be delivered for transmission through the mails or
      interstate commerce by telegraph, telephone, wireless, or other
      means of communication false or misleading or knowingly
      inaccurate reports concerning crop or market information or
      conditions that affect or tend to affect the price of any
      commodity in interstate commerce, or knowingly to violate the
      provisions of section 6, section 6b, subsections (a) through (e)
      of subsection (!1) 6c, section 6h, section 6o(1), or section 23
      of this title.

        (3) Any person knowingly to make, or cause to be made, any
      statement in any application, report, or document required to be
      filed under this chapter or any rule or regulation thereunder or
      any undertaking contained in a registration statement required
      under this chapter, or by any registered entity or registered
      futures association in connection with an application for
      membership or participation therein or to become associated with
      a member thereof, which statement was false or misleading with
      respect to any material fact, or knowingly to omit any material
      fact required to be stated therein or necessary to make the
      statements therein not misleading.
        (4) Any person willfully to falsify, conceal, or cover up by
      any trick, scheme, or artifice a material fact, make any false,
      fictitious, or fraudulent statements or representations, or make
      or use any false writing or document knowing the same to contain
      any false, fictitious, or fraudulent statement or entry to a
      registered entity, board of trade, or futures association
      designated or registered under this chapter acting in furtherance
      of its official duties under this chapter.
        (5) Any person willfully to violate any other provision of this
      chapter, or any rule or regulation thereunder, the violation of
      which is made unlawful or the observance of which is required
      under the terms of this chapter, but no person shall be subject
      to imprisonment under this paragraph for the violation of any
      rule or regulation if such person proves that he had no knowledge
      of such rule or regulation.
    (b) Suspension of convicted felons
      Any person convicted of a felony under this section shall be
    suspended from registration under this chapter and shall be denied
    registration or reregistration for five years or such longer period
    as the Commission may determine, and barred from using, or
    participating in any manner in, any market regulated by the
    Commission for five years or such longer period as the Commission
    shall determine, on such terms and conditions as the Commission may
    prescribe, unless the Commission determines that the imposition of
    such suspension, denial of registration or reregistration, or
    market bar is not required to protect the public interest. The
    Commission may upon petition later review such disqualification and
    market bar and for good cause shown reduce the period thereof.
    (c) Transactions by Commissioners and Commission employees
      prohibited
      It shall be a felony punishable by a fine of not more than
    $500,000 or imprisonment for not more than five years, or both,
    together with the costs of prosecution, for any Commissioner of the
    Commission or any employee or agent thereof, to participate,
    directly or indirectly, in any transaction in commodity futures or
    any transaction of the character of or which is commonly known to
    the trade as an "option", "privilege", "indemnity", "bid", "offer",
    "put", "call", "advance guaranty", or "decline guaranty", or any
    transaction for the delivery of any commodity under a standardized
    contract commonly known to the trade as a margin account, margin
    contract, leverage account, or leverage contract, or under any
    contract, account, arrangement, scheme, or device that the
    Commission determines serves the same function or functions as such
    a standardized contract, or is marketed or managed in substantially
    the same manner as such a standardized contract, or for any such
    person to participate, directly or indirectly, in any investment
    transaction in an actual commodity if nonpublic information is used
    in the investment transaction, if the investment transaction is
    prohibited by rule or regulation of the Commission, or if the
    investment transaction is effected by means of any instrument
    regulated by the Commission. The foregoing prohibitions shall not
    apply to any transaction or class of transactions that the
    Commission, by rule or regulation, has determined would not be
    contrary to the public interest or otherwise inconsistent with the
    purposes of this subsection.
    (d) Use of information by Commissioners and Commission employees
      prohibited
      It shall be a felony punishable by a fine of not more than
    $500,000 or imprisonment for not more than five years, or both,
    together with the costs of prosecution - (1) for any Commissioner
    of the Commission or any employee or agent thereof who, by virtue
    of his employment or position, acquires information which may
    affect or tend to affect the price of any commodity futures or
    commodity and which information has not been made public to impart
    such information with intent to assist another person, directly or
    indirectly, to participate in any transaction in commodity futures,
    any transaction in an actual commodity, or in any transaction of
    the character of or which is commonly known to the trade as an
    "option", "privilege", "indemnity", "bid", "offer", "put", "call",
    "advance guaranty", or "decline guaranty", or in any transaction
    for the delivery of any commodity under a standardized contract
    commonly known to the trade as a margin account, margin contract,
    leverage account, or leverage contract, or under any contract,
    account, arrangement, scheme, or device that the Commission
    determines serves the same function or functions as such a
    standardized contract, or is marketed or managed in substantially
    the same manner as such a standardized contract; and (2) for any
    person to acquire such information from any Commissioner of the
    Commission or any employee or agent thereof and to use such
    information in any transaction in commodity futures, any
    transaction in an actual commodity, or in any transaction of the
    character of or which is commonly known to the trade as an
    "option", "privilege", "indemnity", "bid", "offer", "put", "call",
    "advance guaranty", or "decline guaranty", or in any transaction
    for the delivery of any commodity under a standardized contract
    commonly known to the trade as a margin account, margin contract,
    leverage account, or leverage contract, or under any contract,
    account, arrangement, scheme, or device that the Commission
    determines serves the same function or functions as such a
    standardized contract, or is marketed or managed in substantially
    the same manner as such a standardized contract.
    (e) Redesignated (d)
    (f) Insider trading prohibited
      It shall be a felony for any person - 
        (1) who is an employee, member of the governing board, or
      member of any committee of a board of trade, registered entity,
      or registered futures association, in violation of a regulation
      issued by the Commission, willfully and knowingly to trade for
      such person's own account, or for or on behalf of any other
      account, in contracts for future delivery or options thereon on
      the basis of, or willfully and knowingly to disclose for any
      purpose inconsistent with the performance of such person's
      official duties as an employee or member, any material nonpublic
      information obtained through special access related to the
      performance of such duties.(!2)

        (2) willfully and knowingly to trade for such person's own
      account, or for or on behalf of any other account, in contracts
      for future delivery or options thereon on the basis of any
      material nonpublic information that such person knows was
      obtained in violation of paragraph (1) from an employee, member
      of the governing board, or member of any committee of a board of
      trade, registered entity, or registered futures association.

    Such felony shall be punishable by a fine of not more than
    $500,000, plus the amount of any profits realized from such trading
    or disclosure made in violation of this subsection, or imprisonment
    for not more than five years, or both, together with the costs of
    prosecution.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 9, 42 Stat. 1003; June 15, 1936, ch.
    545, Secs. 2, 11, 49 Stat. 1491, 1501; Pub. L. 90-258, Sec. 25,
    Feb. 19, 1968, 82 Stat. 33; Pub. L. 93-463, title II, Sec. 212(d),
    title IV, Secs. 401, 409, Oct. 23, 1974, 88 Stat. 1404, 1412, 1414;
    Pub. L. 95-405, Sec. 19, Sept. 30, 1978, 92 Stat. 875; Pub. L. 97-
    444, title II, Sec. 227, Jan. 11, 1983, 96 Stat. 2316; Pub. L. 99-
    641, title I, Secs. 105, 110(3), (4), Nov. 10, 1986, 100 Stat.
    3558, 3561; Pub. L. 102-546, title II, Secs. 212(a), 214(a), Oct.
    28, 1992, 106 Stat. 3608, 3610; Pub. L. 106-554, Sec. 1(a)(5)
    [title I, Sec. 123(a)(22)], Dec. 21, 2000, 114 Stat. 2763, 2763A-
    410.)

-MISC1-
                                AMENDMENTS                            
      2000 - Subsecs. (a)(2) to (4), (f)(1), (2). Pub. L. 106-554
    substituted "registered entity" for "contract market".
      1992 - Subsec. (a). Pub. L. 102-546, Sec. 212(a)(1)(A), (C),
    added subsec. (a) and struck out former subsec. (a) which related
    to penalty for embezzlement and larcenous actions.
      Subsec. (b). Pub. L. 102-546, Sec. 212(a)(1)(A), (C), added
    subsec. (b) and struck out former subsec. (b) which related to
    penalty for price manipulation, cornering, and fraudulent
    information.
      Subsec. (c). Pub. L. 102-546, Sec. 212(a)(1)(A), (B), (2),
    redesignated subsec. (d) as (c), substituted "$500,000" for
    "$100,000", and struck out former subsec. (c) which related to
    penalty for misdemeanors.
      Subsecs. (d) to (f). Pub. L. 102-546, Secs. 212(a)(1)(B), (3),
    214(a), redesignated subsec. (e) as (d), substituted "$500,000" for
    "$100,000", and added subsec. (f).
      1986 - Subsec. (c). Pub. L. 99-641, Sec. 110(3), substituted
    "6k," for "6k."
      Subsec. (d). Pub. L. 99-641, Sec. 110(4), substituted "advance
    guaranty" for "advance guarantee".
      Pub. L. 99-641, Sec. 105, inserted "if nonpublic information is
    used in the investment transaction, if the investment transaction
    is prohibited by rule or regulation of the Commission, or if the
    investment transaction is effected by means of any instrument
    regulated by the Commission" after "actual commodity", and
    substituted provisions which related to foregoing prohibitions not
    being applicable to transactions determined by Commission not
    contrary to public interest or inconsistent with this subsection
    for provisions which read as follows: "Such prohibition against any
    investment transaction in an actual commodity shall not apply to
    (1) a transaction in which such person buys an agricultural
    commodity or livestock for use in such person's own farming or
    ranching operations or sells an agricultural commodity which such
    person has produced in connection with such person's own farming or
    ranching operations nor to any transaction in which such person
    sells livestock owned by such person for at least three months, (2)
    a transaction entered into by the trustee of a trust established by
    such person over which such person exercises no control if such
    transaction is entered into solely to hedge against adverse price
    changes in connection with such farming or ranching operations or
    is a transaction for the lease of oil or gas or other mineral
    rights or interests owned by such person, or (3) a transaction in
    which such person buys or sells, directly or indirectly (except by
    means of an instrument regulated by the Commission), a United
    States Government security, a certificate of deposit, or a similar
    financial instrument if no nonpublic information is used by such
    person in such transaction. With respect to such excepted
    transactions, the Commission shall require any Commissioner of the
    Commission or any employee or agent thereof who participates in any
    such transaction to notify the Commission thereof in accordance
    with such regulations as the Commission shall prescribe and the
    Commission shall make such information available to the public."
      1983 - Subsec. (a). Pub. L. 97-444, Sec. 227(1), expanded
    applicability to any person registered or required to be registered
    under this chapter and inserted provision suspending persons
    convicted under this subsec. from registration and denying
    reregistration for five years or longer as determined by the
    Commission, unless such suspension or denial is not required to
    protect the public interest.
      Subsec. (b). Pub. L. 97-444, Sec. 227(2), inserted "A person
    convicted of a felony under this subsection shall be suspended from
    any registration under this chapter, denied registration or
    reregistration for five years or such longer period as the
    Commission shall determine, and barred from using or participating
    in any manner in any market regulated by the Commission for five
    years or such longer period as the Commission shall determine on
    such terms and conditions as the Commission may prescribe, unless
    the Commission determines that the imposition of such suspension,
    denial of registration or reregistration, or market bar is not
    required to protect the public interest. The Commission may upon
    petition later review such disqualification and market bar and for
    good cause shown reduce the period thereof."
      Subsec. (c). Pub. L. 97-444, Sec. 227(3), inserted "A person
    convicted under this subsection of knowingly violating the
    provisions of section 6a of this title shall be suspended from any
    registration under this chapter, denied registration or
    reregistration for a period of two years or such longer period as
    the Commission shall determine, and barred from using or
    participating in any manner in any market regulated by the
    Commission for two years or such longer period as the Commission
    shall determine on such terms and conditions as the Commission may
    prescribe, unless the Commission determines that the imposition of
    such suspension, denial of registration or reregistration, or
    market bar is not required to protect the public interest. The
    Commission may upon petition later review such disqualification and
    market bar and for good cause shown reduce the period thereof."
      Subsec. (d). Pub. L. 97-444, Sec. 227(4), in amending subsec. (d)
    generally, added to range of felonious conduct, participation in
    any transaction for the delivery of any commodity under a
    standardized contract commonly known to the trade as a margin
    account, margin contract, leverage account, or leverage contract,
    or under any contract, account, arrangement, scheme, or device that
    the Commission determines serves the same function or functions as
    such a standardized contract, or is marketed or managed in
    substantially the same manner as such a standardized contract, and
    added to nonapplicability of prohibition against any investment
    transaction in an actual commodity, a transaction entered into by
    the trustee of a trust established by such person over which such
    person exercises no control if such transaction is entered into
    solely to hedge against adverse price changes in connection with
    such farming or ranching operations or is a transaction for the
    lease of oil or gas or other mineral rights or interests owned by
    such person, or a transaction in which such person buys or sells,
    directly or indirectly (except by means of an instrument regulated
    by the Commission), a United States Government security, a
    certificate of deposit, or a similar financial instrument if no
    nonpublic information is used by such person in such transaction.
      Subsec. (e). Pub. L. 97-444, Sec. 227(5), inserted after words "
    'decline guaranty' " each place they appear the following: ", or in
    any transaction for the delivery of any commodity under a
    standardized contract commonly known to the trade as a margin
    account, margin contract, leverage account, or leverage contract,
    or under any contract, account, arrangement, scheme, or device that
    the Commission determines serves the same function or functions as
    such a standardized contract, or is marketed or managed in
    substantially the same manner as such a standardized contract".
      1978 - Subsec. (a). Pub. L. 95-405, Sec. 19(1), substituted
    "$500,000" for "$100,000" and inserted provision relating to a fine
    of not more than $100,000 plus costs of prosecution for a violation
    by a person who is an individual.
      Subsec. (b). Pub. L. 95-405, Sec. 19(2), substituted "$500,000"
    for "$100,000" and inserted provisions making felonies the
    violation of sections 6, 6b, 6c(b) to (e), 6h, 6o(1) and 23 of this
    title, knowingly making any false or misleading statement of
    material fact, or omitting such fact in any application or report,
    and setting the fine for such felonies at not more than $100,000
    for a person who is an individual.
      Subsec. (c). Pub. L. 95-405, Sec. 19(3), inserted references to
    subsecs. (d) and (e) of this section and substituted "sections 6a,
    6c(a), 6d, 6e, 6i, 6k, 6m, 6o(2), or 12b of this title" for
    "sections 6 to 6e, 6h, 6i, 6k, 6m, 6o or 12b of this title".
      Subsecs. (d), (e). Pub. L. 95-405, Sec. 19(4), (5), substituted
    "$100,000" for "$10,000".
      1974 - Subsecs. (a), (b). Pub. L. 93-463, Sec. 212(d)(1), (2),
    substituted "$100,000" for "$10,000".
      Subsec. (c). Pub. L. 93-463, Secs. 212(d)(3), 409, substituted
    "$100,000" for "$10,000" and inserted reference to sections 6k, 6m,
    and 6o of this title.
      Subsecs. (d), (e). Pub. L. 93-463, Sec. 401, added subsecs. (d)
    and (e).
      1968 - Subsec. (a). Pub. L. 90-258 added subsec. (a).
      Subsec. (b). Pub. L. 90-258 incorporated existing offenses in
    provisions designated as subsec. (b), changed classification
    thereof from misdemeanors to felonies, and increased term of
    imprisonment from not more than one year to not more than five
    years.
      Subsec. (c). Pub. L. 90-258 incorporated existing offenses in
    provisions designated as subsec. (c), and included penalty for
    violation of section 12b of this title.
      1936 - Act June 15, 1936, amended section generally and provided
    that price manipulations of commodities in interstate commerce was
    a violation.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1968 AMENDMENT                 
      Amendment by Pub. L. 90-258 effective 120 days after Feb. 19,
    1968, see section 28 of Pub. L. 90-258, set out as a note under
    section 2 of this title.

                     EFFECTIVE DATE OF 1936 AMENDMENT                 
      Amendment by act June 15, 1936, effective 90 days after June 15,
    1936, see section 13 of that act, set out as a note under section 1
    of this title.

                                REGULATIONS                            
      Section 214(b) of Pub. L. 102-546 provided that: "The Commodity
    Futures Trading Commission shall issue regulations to implement the
    amendment made by subsection (a) [amending this section] not later
    than three hundred and sixty days after the date of enactment of
    this Act [Oct. 28, 1992]."

                      PENALTIES STUDY AND GUIDELINES                  
      Section 225 of Pub. L. 102-546 provided that:
      "(a) Study. - The Commodity Futures Trading Commission shall
    study the penalties the Commission imposes against persons found to
    have violated the Commodity Exchange Act (7 U.S.C. 1 et seq.) and
    the penalties imposed by contract markets and registered futures
    associations against persons found to have violated their
    respective rules established under such Act.
      "(b) Report. - Not later than two years after the date of
    enactment of this Act [Oct. 28, 1992], the Commission shall submit
    to the Committee on Agriculture of the House of Representatives and
    the Committee on Agriculture, Nutrition, and Forestry of the Senate
    a report that describes the results of the study conducted under
    subsection (a). The report shall - 
        "(1) include an analysis of whether systematic differences
      exist among penalties imposed by various contract markets and
      registered futures associations for similar offenses, and, if so,
      the causes of such differences;
        "(2) propose industry-wide guidelines or rules to make penalty
      levels among contract markets and registered futures associations
      consistent, including, if appropriate, minimum penalties or
      penalty ranges for various offenses; and
        "(3) propose guidelines or rules to make Commission penalty
      levels consistent, including, if appropriate, minimum penalties
      or penalty ranges for various offenses."

-FOOTNOTE-
    (!1) So in original. Probably should be "section".

               

    (!2) So in original. The period probably should be "; or".

-End-

-CITE-
    7 USC Sec. 13-1                                             01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 13-1. Violations, prohibition against dealings in onion
      futures; punishment

-STATUTE-
      (a) No contract for the sale of onions for future delivery shall
    be made on or subject to the rules of any board of trade in the
    United States. The terms used in this section shall have the same
    meaning as when used in this chapter.
      (b) Any person who shall violate the provisions of this section
    shall be deemed guilty of a misdemeanor and upon conviction thereof
    be fined not more than $5,000.

-SOURCE-
    (Pub. L. 85-839, Sec. 1, Aug. 28, 1958, 72 Stat. 1013.)

-COD-
                               CODIFICATION                           
      Section was not enacted as part of the Commodity Exchange Act
    which comprises this chapter.

-MISC1-
                              EFFECTIVE DATE                          
      Section 2 of Pub. L. 85-839 provided that: "This Act [enacting
    this section] shall take effect thirty days after its enactment
    [Aug. 28, 1958]."

-End-

-CITE-
    7 USC Sec. 13a                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 13a. Nonenforcement of rules of government or other
      violations; cease and desist orders; fines and penalties;
      imprisonment; misdemeanor; separate offenses

-STATUTE-
      If any registered entity is not enforcing or has not enforced its
    rules of government made a condition of its designation or
    registration as set forth in sections 7 through 7a-2 of this title,
    or if any registered entity, or any director, officer, agent, or
    employee of any registered entity otherwise is violating or has
    violated any of the provisions of this chapter or any of the rules,
    regulations, or orders of the Commission thereunder, the Commission
    may, upon notice and hearing on the record and subject to appeal as
    in other cases provided for in section 8(b) of this title, make and
    enter an order directing that such registered entity, director,
    officer, agent, or employee shall cease and desist from such
    violation, and assess a civil penalty of not more than $500,000 for
    each such violation. If such registered entity, director, officer,
    agent, or employee, after the entry of such a cease and desist
    order and the lapse of the period allowed for appeal of such order
    or after the affirmance of such order, shall fail or refuse to obey
    or comply with such order, such registered entity, director,
    officer, agent, or employee shall be guilty of a misdemeanor and,
    upon conviction thereof, shall be fined not more than $500,000 or
    imprisoned for not less than six months nor more than one year, or
    both. Each day during which such failure or refusal to obey such
    cease and desist order continues shall be deemed a separate
    offense. If the offending registered entity or other person upon
    whom such penalty is imposed, after the lapse of the period allowed
    for appeal or after the affirmance of such penalty, shall fail to
    pay such penalty, the Commission shall refer the matter to the
    Attorney General who shall recover such penalty by action in the
    appropriate United States district court. In determining the amount
    of the money penalty assessed under this section, the Commission
    shall consider the gravity of the offense, and in the case of a
    registered entity shall further consider whether the amount of the
    penalty will materially impair the ability of the registered entity
    to carry on its operations and duties.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 6b, as added June 15, 1936, ch. 545,
    Sec. 9, 49 Stat. 1500; amended Pub. L. 90-258, Sec. 18, Feb. 19,
    1968, 82 Stat. 31; Pub. L. 93-463, title II, Sec. 212(b), Oct. 23,
    1974, 88 Stat. 1403; Pub. L. 95-405, Sec. 14, Sept. 30, 1978, 92
    Stat. 872; Pub. L. 102-546, title II, Secs. 209(b)(5), 212(c), Oct.
    28, 1992, 106 Stat. 3607, 3609; Pub. L. 106-554, Sec. 1(a)(5)
    [title I, Sec. 123(a)(14)], Dec. 21, 2000, 114 Stat. 2763, 2763A-
    409.)

-MISC1-
                                AMENDMENTS                            
      2000 - Pub. L. 106-554 substituted "registered entity" for
    "contract market" wherever appearing, "designation or registration
    as set forth in sections 7 through 7a-2 of this title" for
    "designation as set forth in section 7 of this title" in first
    sentence, and "the ability of the registered entity" for "the
    contract market's ability" in last sentence.
      1992 - Pub. L. 102-546 substituted "section 8(b) of this title"
    for "paragraph (a) of section 8 of this title", substituted
    "$500,000" for "$100,000" in two places, and in last sentence
    struck out "the appropriateness of such penalty to the net worth of
    the offending person and" after "Commission shall consider".
      1978 - Pub. L. 95-405 inserted "on the record" after "notice and
    hearing".
      1974 - Pub. L. 93-463 inserted provision for assessment of a
    civil penalty of not more than $100,000 for each violation,
    substituted "not more than $100,000" for "not less than $500 nor
    more than $10,000" as permissible range of fines imposed, inserted
    provisions for enforcement of a penalty, and substituted "orders of
    the Commission" for "orders of the Secretary of Agriculture or the
    commission".
      1968 - Pub. L. 90-258 amended section to clarify application only
    to boards of trade designated as contract markets, to include as
    grounds for cease and desist orders failure to enforce the market's
    rules of government made a condition of its designation and
    violation of rules or regulations of the commission or orders of
    the Secretary, and to authorize such orders in conjunction with a
    suspension or revocation of designation as a contract market rather
    than in lieu of suspension or revocation.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1968 AMENDMENT                 
      Amendment by Pub. L. 90-258 effective 120 days after Feb. 19,
    1968, see section 28 of Pub. L. 90-258, set out as a note under
    section 2 of this title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 13 of act June 15,
    1936, set out as an Effective Date of 1936 Amendment note under
    section 1 of this title.

-End-

-CITE-
    7 USC Sec. 13a-1                                            01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 13a-1. Enjoining or restraining violations

-STATUTE-
    (a) Action to enjoin or restrain violations
      Whenever it shall appear to the Commission that any registered
    entity or other person has engaged, is engaging, or is about to
    engage in any act or practice constituting a violation of any
    provision of this chapter or any rule, regulation, or order
    thereunder, or is restraining trading in any commodity for future
    delivery, the Commission may bring an action in the proper district
    court of the United States or the proper United States court of any
    territory or other place subject to the jurisdiction of the United
    States, to enjoin such act or practice, or to enforce compliance
    with this chapter, or any rule, regulation or order thereunder, and
    said courts shall have jurisdiction to entertain such actions:
    Provided, That no restraining order (other than a restraining order
    which prohibits any person from destroying, altering or disposing
    of, or refusing to permit authorized representatives of the
    Commission to inspect, when and as requested, any books and records
    or other documents or which prohibits any person from withdrawing,
    transferring, removing, dissipating, or disposing of any funds,
    assets, or other property, and other than an order appointing a
    temporary receiver to administer such restraining order and to
    perform such other duties as the court may consider appropriate) or
    injunction for violation of the provisions of this chapter shall be
    issued ex parte by said court.
    (b) Injunction or restraining order
      Upon a proper showing a permanent or temporary injunction or
    restraining order shall be granted without bond.
    (c) Writs or other orders
      Upon application of the Commission, the district courts of the
    United States and the United States courts of any territory or
    other place subject to the jurisdiction of the United States shall
    also have jurisdiction to issue writs of mandamus, or orders
    affording like relief, commanding any person to comply with the
    provisions of this chapter or any rule, regulation, or order of the
    Commission thereunder, including the requirement that such person
    take such action as is necessary to remove the danger of violation
    of this chapter or any such rule, regulation, or order: Provided,
    That no such writ of mandamus, or order affording like relief,
    shall be issued ex parte.
    (d) Civil penalties
      (1) In any action brought under this section, the Commission may
    seek and the court shall have jurisdiction to impose, on a proper
    showing, on any person found in the action to have committed any
    violation a civil penalty in the amount of not more than the higher
    of $100,000 or triple the monetary gain to the person for each
    violation.
      (2) If a person on whom such a penalty is imposed fails to pay
    the penalty within the time prescribed in the court's order, the
    Commission may refer the matter to the Attorney General who shall
    recover the penalty by action in the appropriate United States
    district court.
    (e) Venue and process
      Any action under this section may be brought in the district
    wherein the defendant is found or is an inhabitant or transacts
    business or in the district where the act or practice occurred, is
    occurring, or is about to occur, and process in such cases may be
    served in any district in which the defendant is an inhabitant or
    wherever the defendant may be found.
    (f) Action by Attorney General
      In lieu of bringing actions itself pursuant to this section, the
    Commission may request the Attorney General to bring the action.
    (g) Notice to Attorney General of action brought by Commission
      Where the Commission elects to bring the action, it shall inform
    the Attorney General of such suit and advise him of subsequent
    developments.
    (h) Notice of investigations and enforcement actions
      The Commission shall provide the Securities and Exchange
    Commission with notice of the commencement of any proceeding and a
    copy of any order entered by the Commission against any futures
    commission merchant or introducing broker registered pursuant to
    section 6f(a)(2) of this title, any floor broker or floor trader
    exempt from registration pursuant to section 6f(a)(3) of this
    title, any associated person exempt from registration pursuant to
    section 6k(6) (!1) of this title, or any board of trade designated
    as a contract market pursuant to section 7b-1 of this title.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 6c, as added Pub. L. 93-463, title
    II, Sec. 211, Oct. 23, 1974, 88 Stat. 1402; amended Pub. L. 97-444,
    title II, Sec. 220, Jan. 11, 1983, 96 Stat. 2308; Pub. L. 99-641,
    title I, Sec. 104, Nov. 10, 1986, 100 Stat. 3557; Pub. L. 102-546,
    title II, Sec. 221, Oct. 28, 1992, 106 Stat. 3614; Pub. L. 106-554,
    Sec. 1(a)(5) [title I, Sec. 123(a)(15), title II, Sec. 253(c)],
    Dec. 21, 2000, 114 Stat. 2763, 2763A-409, 2763A-449.)

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (a). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(15)], substituted "registered entity" for "contract market".
      Subsec. (h). Pub. L. 106-554, Sec. 1(a)(5) [title II, Sec.
    253(c)], added subsec. (h).
      1992 - Pub. L. 102-546 designated first, second, and third
    sentences as subsecs. (a) to (c), respectively, added subsec. (d),
    and designated fourth, fifth, and sixth sentences as subsecs. (e)
    to (g), respectively.
      1986 - Pub. L. 99-641 inserted ", and other than an order
    appointing a temporary receiver to administer such restraining
    order and to perform such other duties as the court may consider
    appropriate".
      1983 - Pub. L. 97-444 inserted "(other than a restraining order
    which prohibits any person from destroying, altering or disposing
    of, or refusing to permit authorized representatives of the
    Commission to inspect, when and as requested, any books and records
    or other documents or which prohibits any person from withdrawing,
    transferring, removing, dissipating, or disposing of any funds,
    assets, or other property)" after "Provided, That no restraining
    order".

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 418 of Pub. L. 93-463,
    set out as an Effective Date of 1974 Amendment note under section 2
    of this title.

-FOOTNOTE-
    (!1) So in original. Probably should refer to the second par. (5) of
         section 6k.

-End-

-CITE-
    7 USC Sec. 13a-2                                            01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 13a-2. Jurisdiction of States

-STATUTE-
      (1) Whenever it shall appear to the attorney general of any
    State, the administrator of the securities laws of any State, or
    such other official as a State may designate, that the interests of
    the residents of that State have been, are being, or may be
    threatened or adversely affected because any person (other than a
    contract market, derivatives transaction execution facility,
    clearinghouse, floor broker, or floor trader) has engaged in, is
    engaging or is about to engage in, any act or practice constituting
    a violation of any provision of this chapter or any rule,
    regulation, or order of the Commission thereunder, the State may
    bring a suit in equity or an action at law on behalf of its
    residents to enjoin such act or practice, to enforce compliance
    with this chapter, or any rule, regulation, or order of the
    Commission thereunder, to obtain damages on behalf of their
    residents, or to obtain such further and other relief as the court
    may deem appropriate.
      (2) The district courts of the United States, the United States
    courts of any territory, and the District Court of the United
    States for the District of Columbia, shall have jurisdiction of all
    suits in equity and actions at law brought under this section to
    enforce any liability or duty created by this chapter or any rule,
    regulation, or order of the Commission thereunder, or to obtain
    damages or other relief with respect thereto. Upon proper
    application, such courts shall also have jurisdiction to issue
    writs of mandamus, or orders affording like relief, commanding the
    defendant to comply with the provisions of this chapter or any
    rule, regulation, or order of the Commission thereunder, including
    the requirement that the defendant take such action as is necessary
    to remove the danger of violation of this chapter or of any such
    rule, regulation, or order. Upon a proper showing, a permanent or
    temporary injunction or restraining order shall be granted without
    bond.
      (3) Immediately upon instituting any such suit or action, the
    State shall serve written notice thereof upon the Commission and
    provide the Commission with a copy of its complaint, and the
    Commission shall have the right to (A) intervene in the suit or
    action and, upon doing so, shall be heard on all matters arising
    therein, and (B) file petitions for appeal.
      (4) Any suit or action brought under this section in a district
    court of the United States may be brought in the district wherein
    the defendant is found or is an inhabitant or transacts business or
    wherein the act or practice occurred, is occurring, or is about to
    occur, and process in such cases may be served in any district in
    which the defendant is an inhabitant or wherever the defendant may
    be found.
      (5) For purposes of bringing any suit or action under this
    section, nothing in this chapter shall prevent the attorney
    general, the administrator of the State securities laws, or other
    duly authorized State officials from exercising the powers
    conferred on them by the laws of such State to conduct
    investigations or to administer oaths or affirmations or to compel
    the attendance of witnesses or the production of documentary and
    other evidence.
      (6) For purposes of this section, "State" means any State of the
    United States, the District of Columbia, the Commonwealth of Puerto
    Rico, or any territory or possession of the United States.
      (7) Nothing contained in this section shall prohibit an
    authorized State official from proceeding in State court on the
    basis of an alleged violation of any general civil or criminal
    antifraud statute of such State.
      (8)(A) Nothing in this chapter shall prohibit an authorized State
    official from proceeding in a State court against any person
    registered under this chapter (other than a floor broker, floor
    trader, or registered futures association) for an alleged violation
    of any antifraud provision of this chapter or any antifraud rule,
    regulation, or order issued pursuant to the chapter.
      (B) The State shall give the Commission prior written notice of
    its intent to proceed before instituting a proceeding in State
    court as described in this subsection and shall furnish the
    Commission with a copy of its complaint immediately upon
    instituting any such proceeding. The Commission shall have the
    right to (i) intervene in the proceeding and, upon doing so, shall
    be heard on all matters arising therein, and (ii) file a petition
    for appeal. The Commission or the defendant may remove such
    proceeding to the district court of the United States for the
    proper district by following the procedure for removal otherwise
    provided by law, except that the petition for removal shall be
    filed within sixty days after service of the summons and complaint
    upon the defendant. The Commission shall have the right to appear
    as amicus curiae in any such proceeding.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 6d, as added Pub. L. 95-405, Sec.
    15, Sept. 30, 1978, 92 Stat. 872; amended Pub. L. 97-444, title II,
    Sec. 221, Jan. 11, 1983, 96 Stat. 2308; Pub. L. 102-546, title II,
    Sec. 207(b)(1), (2), Oct. 28, 1992, 106 Stat. 3604; Pub. L. 106-
    554, Sec. 1(a)(5) [title I, Sec. 123(a)(16)], Dec. 21, 2000, 114
    Stat. 2763, 2763A-409.)

-MISC1-
                                AMENDMENTS                            
      2000 - Par. (1). Pub. L. 106-554 inserted "derivatives
    transaction execution facility," after "contract market,".
      1992 - Pars. (1), (8)(A). Pub. L. 102-546 inserted reference to
    floor trader.
      1983 - Par. (8). Pub. L. 97-444 added par. (8).

                     EFFECTIVE DATE OF 1992 AMENDMENT                 
      Amendment by Pub. L. 102-546 effective 180 days after Oct. 28,
    1992, with Commodity Futures Trading Commission to issue any
    regulations necessary to implement such amendment no later than 180
    days after Oct. 28, 1992, see section 207(c) of Pub. L. 102-546,
    set out as a note under section 6e of this title.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      Section effective Oct. 1, 1978, see section 28 of Pub. L. 95-405,
    set out as an Effective Date of 1978 Amendment note under section 2
    of this title.

-End-

-CITE-
    7 USC Sec. 13b                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 13b. Manipulations or other violations; cease and desist
      orders against persons other than registered entities;
      punishment; misdemeanor or felony; separate offenses

-STATUTE-
      If any person (other than a registered entity) is manipulating or
    attempting to manipulate or has manipulated or attempted to
    manipulate the market price of any commodity, in interstate
    commerce, or for future delivery on or subject to the rules of any
    registered entity, or otherwise is violating or has violated any of
    the provisions of this chapter or of the rules, regulations, or
    orders of the Commission or the commission (!1) thereunder, the
    Commission may, upon notice and hearing, and subject to appeal as
    in other cases provided for in sections 9 and 15 of this title,
    make and enter an order directing that such person shall cease and
    desist therefrom and, if such person thereafter and after the lapse
    of the period allowed for appeal of such order or after the
    affirmance of such order, shall fail or refuse to obey or comply
    with such order, such person shall be guilty of a misdemeanor and,
    upon conviction thereof, shall be fined not more than the higher of
    $100,000 or triple the monetary gain to such person, or imprisoned
    for not less than six months nor more than one year, or both,
    except that if such failure or refusal to obey or comply with such
    order involves any offense within paragraph (a) or (b) of section
    13 of this title, such person shall be guilty of a felony and, upon
    conviction thereof, shall be subject to the penalties of said
    paragraph (a) or (b): Provided, That any such cease and desist
    order against any respondent in any case of manipulation of, or
    attempt to manipulate, the price of any commodity shall be issued
    only in conjunction with an order issued against such respondent
    under sections 9 and 15 of this title. Each day during which such
    failure or refusal to obey or comply with such order continues
    shall be deemed a separate offense.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 6(d), formerly Sec. 6(c), as added
    Pub. L. 90-258, Sec. 17, Feb. 19, 1968, 82 Stat. 31; amended Pub.
    L. 93-463, title I, Sec. 103(a), (b), title II, Sec. 212(c), Oct.
    23, 1974, 88 Stat. 1392, 1404; renumbered Sec. 6(d) and amended
    Pub. L. 102-546, title II, Secs. 209(a)(1), (4), 212(b), Oct. 28,
    1992, 106 Stat. 3606, 3609; Pub. L. 106-554, Sec. 1(a)(5) [title I,
    Sec. 123(a)(12)(D)], Dec. 21, 2000, 114 Stat. 2763, 2763A-409.)

-COD-
                               CODIFICATION                           
      Section is comprised of subsec. (d) of section 6 of act Sept. 21,
    1922. Subsecs. (a) and (b) of section 6 are classified to section 8
    of this title. Subsec. (c) of section 6 is classified to sections 9
    and 15 of this title. Subsecs. (e), (f), and (g) of section 6 are
    classified to sections 9a, 9b, and 9c of this title, respectively.

-MISC1-
                                AMENDMENTS                            
      2000 - Pub. L. 106-554 substituted "registered entity" for
    "contract market" in two places.
      1992 - Pub. L. 102-546 made technical amendment to references to
    sections 9 and 15 of this title to reflect change in reference to
    corresponding section of original act and substituted "the higher
    of $100,000 or triple the monetary gain to such person" for
    "$100,000".
      1974 - Pub. L. 93-463, Secs. 103(a), 212(c), substituted
    "Commission" for "Secretary" before "may" and substituted "not more
    than $100,000" for "not less than $500 nor more than $10,000".
      Pub. L. 93-463, Sec. 103(a), provided for substitution of
    "Commission" for "Secretary of Agriculture" except where such words
    would be stricken by section 103(b), which directed striking the
    words "the Secretary of Agriculture or" where they appeared in the
    phrase "the Secretary of Agriculture or the Commission". Because
    the word "commission" was not capitalized in the text of this
    section, section 103(b) did not apply to this section and therefore
    section 103(a) was executed, resulting in the substitution of "the
    Commission or the commission" for "the Secretary of Agriculture or
    the commission".

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      Section effective 120 days after Feb. 19, 1968, see section 28 of
    Pub. L. 90-258, set out as an Effective Date of 1968 Amendment note
    under section 2 of this title.

-FOOTNOTE-
    (!1) So in original. The words "or the commission" probably should
         not appear.

-End-

-CITE-
    7 USC Sec. 13c                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 13c. Responsibility as principal; minor violations

-STATUTE-
      (a) Any person who commits, or who willfully aids, abets,
    counsels, commands, induces, or procures the commission of, a
    violation of any of the provisions of this chapter, or any of the
    rules; regulations, or orders issued pursuant to this chapter, or
    who acts in combination or concert with any other person in any
    such violation, or who willfully causes an act to be done or
    omitted which if directly performed or omitted by him or another
    would be a violation of the provisions of this chapter or any of
    such rules, regulations, or orders may be held responsible for such
    violation as a principal.
      (b) Any person who, directly or indirectly, controls any person
    who has violated any provision of this chapter or any of the rules,
    regulations, or orders issued pursuant to this chapter may be held
    liable for such violation in any action brought by the Commission
    to the same extent as such controlled person. In such action, the
    Commission has the burden of proving that the controlling person
    did not act in good faith or knowingly induced, directly or
    indirectly, the act or acts constituting the violation.
      (c) Nothing in this chapter shall be construed as requiring the
    Commission or the Commission (!1) to report minor violations of
    this chapter for prosecution, whenever it appears that the public
    interest does not require such action.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 13, as added Pub. L. 90-258, Sec.
    26, Feb. 19, 1968, 82 Stat. 34; amended Pub. L. 93-463, title I,
    Sec. 103(a), (b), Oct. 23, 1974, 88 Stat. 1392; Pub. L. 97-444,
    title II, Sec. 230, Jan. 11, 1983, 96 Stat. 2319; Pub. L. 102-546,
    title IV, Sec. 402(1)(D), (9)(C), Oct. 28, 1992, 106 Stat. 3624,
    3625.)

-MISC1-
                                AMENDMENTS                            
      1992 - Subsec. (c). Pub. L. 102-546, Sec. 402(9)(C), which
    directed that "the Secretary of Agriculture or" be struck out,
    could not be executed because of amendment by Pub. L. 93-463, Sec.
    103(a). See 1974 Amendment note below.
      Pub. L. 102-546, Sec. 402(1)(D), substituted "Commission" for
    "commission" before "to report".
      1983 - Subsec. (a). Pub. L. 97-444, Sec. 230(1), struck out "in
    administrative proceedings under this chapter" after "may be held
    responsible".
      Subsecs. (b), (c). Pub. L. 97-444, Sec. 230(2), (3), added
    subsec. (b) and redesignated former subsec. (b) as (c).
      1974 - Subsec. (b). Pub. L. 93-463, Sec. 103(a), provided for
    substitution of "Commission" for "Secretary of Agriculture" except
    where such words would be stricken by section 103(b), which
    directed striking the words "the Secretary of Agriculture or" where
    they appeared in the phrase "the Secretary of Agriculture or the
    Commission". Because the word "commission" was not capitalized in
    the text of this section, section 103(b) did not apply to this
    section and therefore section 103(a) was executed, resulting in the
    substitution of "the Commission or the commission" for "the
    Secretary of Agriculture or the commission".

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      Section effective 120 days after Feb. 19, 1968, see section 28 of
    Pub. L. 90-258, set out as an Effective Date of 1968 Amendment note
    under section 2 of this title.

-FOOTNOTE-
    (!1) So in original. The words "or the Commission" probably should
         not appear.

-End-

-CITE-
    7 USC Sec. 14                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 14. Repealed.

-MISC1-
    Sec. 14. Repealed. Pub. L. 99-641, title I, Sec. 110(5), Nov. 10,
      1986, 100 Stat. 3561.
      Section, act Sept. 21, 1922, ch. 369, Sec. 11, 42 Stat. 1003,
    provided that violations of this chapter occurring before Nov. 1,
    1922, should not be punishable.

-End-

-CITE-
    7 USC Sec. 15                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 15. Enforcement powers of Commission

-STATUTE-
      For the purpose of securing effective enforcement of the
    provisions of this chapter, for the purpose of any investigation or
    proceeding under this chapter, and for the purpose of any action
    taken under section 16(f) of this title, any member of the
    Commission or any Administrative Law Judge or other officer
    designated by the Commission (except as provided in the third
    sentence of this section) may administer oaths and affirmations,
    subpoena witnesses, compel their attendance, take evidence, and
    require the production of any books, papers, correspondence,
    memoranda, or other records that the Commission deems relevant or
    material to the inquiry. The attendance of witnesses and the
    production of any such records may be required from any place in
    the United States, any State, or any foreign country or
    jurisdiction at any designated place of hearing. A subpoena issued
    under this section may be served upon any person who is not to be
    found within the territorial jurisdiction of any court of the
    United States in such manner as the Federal Rules of Civil
    Procedure prescribe for service of process in a foreign country,
    except that a subpoena to be served on a person who is not to be
    found within the territorial jurisdiction of any court of the
    United States may be issued only on the prior approval of the
    Commission. In case of contumacy by, or refusal to obey a subpoena
    issued to, any person, the Commission may invoke the aid of any
    court of the United States within the jurisdiction in which the
    investigation or proceeding is conducted, or where such person
    resides or transacts business, in requiring the attendance and
    testimony of witnesses and the production of books, papers,
    correspondence, memoranda, and other records. Such court may issue
    an order requiring such person to appear before the Commission or
    member or Administrative Law Judge or other officer designated by
    the Commission, there to produce records, if so ordered, or to give
    testimony touching the matter under investigation or in question.
    Any failure to obey such order of the court may be punished by the
    court as a contempt thereof. All process in any such case may be
    served in the judicial district wherein such person is an
    inhabitant or transacts business or wherever such person may be
    found.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 6(c), formerly Sec. 6(b), 42 Stat.
    1002; June 15, 1936, ch. 545, Sec. 8(e)-(g), 49 Stat. 1499; June
    16, 1955, ch. 151, 69 Stat. 160; Pub. L. 91-452, title II, Sec.
    202, Oct. 15, 1970, 84 Stat. 928; Pub. L. 93-463, title I, Sec.
    103(d), title IV, Sec. 408(b), Oct. 23, 1974, 88 Stat. 1392, 1414;
    Pub. L. 95-405, Sec. 13(3), Sept. 30, 1978, 92 Stat. 871; Pub. L.
    99-641, title I, Sec. 103, Nov. 10, 1986, 100 Stat. 3557;
    renumbered Sec. 6(c) and amended Pub. L. 102-546, title II, Sec.
    209(a)(1), title III, Sec. 301, title IV, Sec. 402(7), Oct. 28,
    1992, 106 Stat. 3606, 3622, 3624.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      This section, referred to in text, means section 6 of act Sept.
    21, 1922, ch. 369, 42 Stat. 1001. For classification of section 6
    to the Code, see Codification note below.
      The Federal Rules of Civil Procedure, referred to in text, are
    set out in the Appendix to Title 28, Judiciary and Judicial
    Procedure.

-COD-
                               CODIFICATION                           
      Section is comprised of part of subsec. (c) of section 6 of act
    Sept. 21, 1922. A further provision of subsec. (c) is contained in
    section 9 of this title. This subsec. (c) [former par. (a)] prior
    to its incorporation into the Code contained a provision as to
    finality of judgments and review by the Supreme Court and is
    covered by section 1254 of Title 28, Judiciary and Judicial
    Procedure. Subsecs. (a) and (b) of section 6 are classified to
    section 8 of this title. Subsecs. (d), (e), (f), and (g) of section
    6 are classified to sections 13b, 9a, 9b, and 9c of this title,
    respectively.

-MISC1-
                                AMENDMENTS                            
      1992 - Pub. L. 102-546 substituted "chapter," for "chapter and"
    after "provisions of this", "chapter, and for the purpose of any
    action taken under section 16(f) of this title, any" for "chapter,
    any", and "subpoena" for "subpena" wherever appearing.
      1986 - Pub. L. 99-641 inserted "(except as provided in the third
    sentence of this section)", substituted ", any State, or any
    foreign country or jurisdiction" for "or any State", and inserted
    provisions which related to service of subpena upon person not
    found within territorial jurisdiction of United States.
      1978 - Pub. L. 95-405 substituted provisions giving Commission or
    any Administrative Law Judge or other officer designated by
    Commission independent authority to administer oaths and
    affirmations, to subpena witnesses, and related actions for the
    purpose of conducting investigations and proceedings with regard to
    this chapter for provisions basing authority of Commission or any
    Administrative Law Judge with regard to investigations and
    proceedings under this chapter on the Interstate Commerce Act and
    inserted provisions authorizing Commission to invoke the aid of the
    courts in requiring attendance and testimony of witnesses and the
    production of books and other records.
      1974 - Pub. L. 93-463 struck out "the Secretary of Agriculture
    (or any person designated by him)," after "jurisdiction, and
    authority of" and substituted "Administrative Law Judge" for
    "referee".
      1970 - Pub. L. 91-452 struck out references to sections 46-48 of
    title 49, and provisions relating to the immunity of witnesses.
      1955 - Act June 16, 1955, extended subpoena power to
    investigations.
      1936 - Act June 15, 1936, Sec. 8(e), (f), substituted "sections
    12 and 46-48 of title 49" for "section 12 of title 49".
      Act June 15, 1936, Sec. 8(g), substituted "and" for "or" after
    "commission".

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment of Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1970 AMENDMENT                 
      Amendment by Pub. L. 91-452 effective on sixtieth day following
    Oct. 15, 1970, and not to affect any immunity to which any
    individual is entitled under this section by reason of any
    testimony given before sixtieth day following Oct. 15, 1970, see
    section 260 of Pub. L. 91-452, set out as an Effective Date;
    Savings Provision note under section 6001 of Title 18, Crimes and
    Criminal Procedure.

                     EFFECTIVE DATE OF 1936 AMENDMENT                 
      Amendment by act June 15, 1936, effective 90 days after June 15,
    1936, see section 13 of that act, set out as a note under section 1
    of this title.

-End-

-CITE-
    7 USC Sec. 15a                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 15a. Repealed.

-MISC1-
    Sec. 15a. Repealed. Pub. L. 95-405, Sec. 24, Sept. 30, 1978, 92
      Stat. 877.
      Section, Pub. L. 93-463, title II, Sec. 217, Oct. 23, 1974, 88
    Stat. 1405, related to leverage contracts for gold and silver. See
    section 23(b) of this title.

                         EFFECTIVE DATE OF REPEAL                     
      Repeal effective Oct. 1, 1978, see section 28 of Pub. L. 95-405,
    set out as an Effective Date of 1978 Amendment note under section 2
    of this title.

-End-

-CITE-
    7 USC Sec. 15b                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 15b. Cotton futures contracts

-STATUTE-
    (a) Short title
      This section may be cited as the "United States Cotton Futures
    Act".
    (b) Repeal of tax on cotton futures
      Subchapter D of chapter 39 of title 26 (relating to tax on cotton
    futures) is repealed.
    (c) Definitions
      For purposes of this section - 
      (1) Cotton futures contract
        The term "cotton futures contract" means any contract of sale
      of cotton for future delivery made at, on, or in any exchange,
      board of trade, or similar institution or place of business which
      has been designated a "contract market" by the Commodity Futures
      Trading Commission pursuant to the Commodity Exchange Act [7
      U.S.C. 1 et seq.] and the term "contract of sale" as so used
      shall be held to include sales, agreements of sale, and
      agreements to sell, except that any cotton futures contract that,
      by its terms, is settled in cash is excluded from the coverage of
      this paragraph and section.
      (2) Future delivery
        The term "future delivery" shall not include any cash sale of
      cotton for deferred shipment or delivery.
      (3) Person
        The term "person" includes an individual, trust, estate,
      partnership, association, company, or corporation.
      (4) Secretary
        The term "Secretary" means the Secretary of Agriculture of the
      United States.
      (5) Standards
        The term "standards" means the official cotton standards of the
      United States established by the Secretary pursuant to the United
      States Cotton Standards Act, as amended [7 U.S.C. 51 et seq.].
    (d) Bona fide spot markets and commercial differences
      (1) Definition
        For purposes of this section, the only markets which shall be
      considered bona fide spot markets shall be those which the
      Secretary shall, from time to time, after investigation,
      determine and designate to be such, and of which he shall give
      public notice.
      (2) Determination
        In determining, pursuant to the provisions of this section,
      what markets are bona fide spot markets, the Secretary is
      directed to consider only markets in which spot cotton is sold in
      such volume and under such conditions as customarily to reflect
      accurately the value of middling cotton and the differences
      between the prices or values of middling cotton and of other
      grades of cotton for which standards shall have been established
      by the Secretary; except that if there are not sufficient places,
      in the markets of which are made bona fide sales of spot cotton
      of grades for which standards are established by the Secretary,
      to enable him to designate at least five spot markets in
      accordance with subsection (f)(3) of this section, he shall, from
      data as to spot sales collected by him, make rules and
      regulations for determining the actual commercial differences in
      the value of spot cotton of the grades established by him as
      reflected by bona fide sales of spot cotton, of the same or
      different grades, in the market selected and designated by him,
      from time to time, for that purpose, and in that event
      differences in value of cotton of various grades involved in
      contracts made pursuant to subsection (f)(1) and (2) of this
      section shall be determined in compliance with such rules and
      regulations. It shall be the duty of any person engaged in the
      business of dealing in cotton, when requested by the Secretary or
      any agent acting under his instructions, to answer correctly to
      the best of his knowledge, under oath or otherwise, all questions
      touching his knowledge of the number of bales, the
      classification, the price or bona fide price offered, and other
      terms of purchase or sale, of any cotton involved in any
      transaction participated in by him, or to produce all books,
      letters, papers, or documents in his possession or under his
      control relating to such matter. A person complying with the
      preceding sentence shall not be liable for any loss or damage
      arising or resulting from such compliance.
      (3) Withholding information
        Any person engaged in the business of dealing in cotton who
      shall, within a reasonable time prescribed by the Secretary or
      any agent acting under his instructions, willfully fail or refuse
      to answer questions or to produce books, letters, papers, or
      documents, as required under paragraph (2) of this subsection, or
      who shall willfully give any answer that is false or misleading,
      shall, upon conviction thereof, be fined not more than $500.
    (e) Form and validity of cotton futures contracts
      Each cotton futures contract shall be a basis grade contract, or
    a tendered grade contract, or a specific grade contract as
    specified in subsections (f), (g), or (h) of this section and shall
    be in writing plainly stating, or evidenced by written memorandum
    showing, the terms of such contract, including the quantity of the
    cotton involved and the names and addresses of the seller and buyer
    in such contract, and shall be signed by the party to be charged,
    or by his agent in his behalf. No cotton futures contract which
    does not conform to such requirements shall be enforceable by, or
    on behalf of, any party to such contract or his privies.
    (f) Basis grade contracts
      (1) Conditions
        Each basis grade cotton futures contract shall comply with each
      of the following conditions:
        (A) Conformity with regulations
          Conform to the regulations made pursuant to this section.
        (B) Specification of grade, price, and dates of sale and
          settlement
          Specify the basis grade for the cotton involved in the
        contract, which shall be one of the grades for which standards
        are established by the Secretary, except grades prohibited from
        being delivered on a contract made under this subsection by
        subparagraph (E), the price per pound at which the cotton of
        such basis grade is contracted to be bought or sold, the date
        when the purchase or sale was made, and the month or months in
        which the contract is to be fulfilled or settled; except that
        middling shall be deemed the basis grade incorporated into the
        contract if no other basis grade be specified either in the
        contract or in the memorandum evidencing the same.
        (C) Provision for delivery of standard grades only
          Provide that the cotton dealt with therein or delivered
        thereunder shall be of or within the grades for which standards
        are established by the Secretary except grades prohibited from
        being delivered on a contract made under this subsection by
        subparagraph (E) and no other grade or grades.
        (D) Provision for settlement on basis of actual commercial
          differences
          Provide that in case cotton of grade other than the basis
        grade be tendered or delivered in settlement of such contract,
        the differences above or below the contract price which the
        receiver shall pay for such grades other than the basis grade
        shall be the actual commercial differences, determined as
        hereinafter provided.
        (E) Prohibition of delivery of inferior cotton
          Provide that cotton that, because of the presence of
        extraneous matter of any character, or irregularities or
        defects, is reduced in value below that of low middling, or
        cotton that is below the grade of low middling, or, if tinged,
        cotton that is below the grade of strict middling, or, if
        yellow stained, cotton that is below the grade of good
        middling, the grades mentioned being of the official cotton
        standards of the United States, or cotton that is less than
        seven-eighths of an inch in length of staple, or cotton of
        perished staple, or of immature staple, or cotton that is "gin
        cut" or reginned, or cotton that is "repacked" or "false
        packed" or "mixed packed" or "water packed", shall not be
        delivered on, under, or in settlement of such contract.
        (F) Provisions for tender in full, notice of delivery date, and
          certificate of grade
          Provide that all tenders of cotton under such contract shall
        be the full number of bales involved therein, except that such
        variations of the number of bales may be permitted as is
        necessary to bring the total weight of the cotton tendered
        within the provisions of the contract as to weight; that, on
        the fifth business day prior to delivery, the person making the
        tender shall give to the person receiving the same written
        notice of the date of delivery, and that, on or prior to the
        date so fixed for delivery, and in advance of final settlement
        of the contract, the person making the tender shall furnish to
        the person receiving the same a written notice or certificate
        stating the grade of each individual bale to be delivered and,
        by means of marks or numbers, identifying each bale with its
        grade.
        (G) Provision for tender and settlement in accordance with
          Government classification
          Provide that all tenders of cotton and settlements therefor
        under such contract shall be in accordance with the
        classification thereof made under the regulations of the
        Secretary by such officer or officers of the Government as
        shall be designated for the purpose, and the costs of such
        classification shall be fixed, assessed, collected, and paid as
        provided in such regulations and shall be credited to the
        account referred to in section 55 of this title. The Secretary
        may provide by regulation conditions under which cotton samples
        submitted or used in the performance of services authorized by
        this act shall become the property of the United States and may
        be sold and the proceeds credited to the foregoing account:
        Provided, That such cotton samples shall not be subject to the
        provisions of the Federal Property and Administrative Services
        Act of 1949.(!1) The Secretary is authorized to prescribe
        regulations for carrying out the purposes of this subparagraph
        and the certificates of the officers of the Government as to
        the classification of any cotton for the purposes of this
        subparagraph shall be accepted in the courts of the United
        States in all suits between the parties to such contract, or
        their privies, as prima facie evidence of the true
        classification of the cotton involved.

      (2) Incorporation of conditions in contracts
        The provisions of paragraphs (1)(C), (D), (E), (F), and (G)
      shall be deemed fully incorporated into any such contract if
      there be written or printed thereon, or on the memorandums
      evidencing the same, at or prior to the time the same is signed,
      the phrase "Subject to United States Cotton Futures Act,
      subsection (f)."
      (3) Delivery allowances
        For the purpose of this subsection, the differences above or
      below the contract price which the receiver shall pay for cotton
      of grades above or below the basic (!2) grade in the settlement
      of a contract of sale for the future delivery of cotton shall be
      determined by the actual commercial differences in value thereof
      upon the sixth business day prior to the day fixed, in accordance
      with paragraph (1)(F), for the delivery of cotton on the
      contract, established by the sale of spot cotton in the spot
      markets of not less than five places designated for the purpose
      from time to time by the Secretary, as such values were
      established by the sales of spot cotton, in such designated five
      or more markets. For purposes of this paragraph, such values in
      the such spot markets shall be based upon the standards for
      grades of cotton established by the Secretary. Whenever the value
      of one grade is to be determined from the sale or sales of spot
      cotton of another grade or grades, such value shall be fixed in
      accordance with rules and regulations which shall be prescribed
      for the purpose by the Secretary.

    (g) Tendered grade contracts
      (1) Conditions
        Each tendered grade cotton future contract shall comply with
      each of the following conditions:
        (A) Compliance with subsection (f)
          Comply with all the terms and conditions of subsection (f) of
        this section not inconsistent with this subsection; and
        (B) Provision for contingent specific performance
          Provide that, in case cotton of grade or grades other than
        the basis grade specified in the contract shall be tendered in
        performance of the contract, the parties to such contract may
        agree, at the time of the tender, as to the price of the grade
        or grades so tendered, and that if they shall not then agree as
        to such price, then, and in that event, the buyer of said
        contract shall have the right to demand the specific
        fulfillment of such contract by the actual delivery of cotton
        of the basis grade named therein and at the price specified for
        such basis grade in said contract.
      (2) Incorporation of conditions in contract
        Contracts made in compliance with this subsection shall be
      known as "subsection (g) Contracts". The provisions of this
      subsection shall be deemed fully incorporated into any such
      contract if there be written or printed thereon, or on the
      memorandum evidencing the same, at or prior to the time the same
      is signed, the phrase "Subject to United States Cotton Futures
      Act, subsection (g)".
      (3) Application of subsection
        Nothing in this subsection shall be so construed as to
      authorize any contract in which, or in the settlement of or in
      respect to which, any device or arrangement whatever is resorted
      to, or any agreement is made, for the determination or adjustment
      of the price of the grade or grades tendered other than the basis
      grade specified in the contract by any "fixed difference" system,
      or by arbitration, or by any other method not provided for by
      this section.
    (h) Specific grade contracts
      (1) Conditions
        Each specific grade cotton futures contract shall comply with
      each of the following conditions:
        (A) Conformity with rules and regulations
          Conform to the rules and regulations made pursuant to this
        section.
        (B) Specification of grade, price, dates of sale and delivery
          Specify the grade, type, sample, or description of the cotton
        involved in the contract, the price per pound at which such
        cotton is contracted to be bought or sold, the date of the
        purchase or sale, and the time when shipment or delivery of
        such cotton is to be made.
        (C) Prohibition of delivery of other than specified grade
          Provide that cotton of or within the grade or of the type, or
        according to the sample or description, specified in the
        contract shall be delivered thereunder, and that no cotton
        which does not conform to the type, sample, or description, or
        which is not of or within the grade specified in the contract
        shall be tendered or delivered thereunder.
        (D) Provision for specific performance
          Provide that the delivery of cotton under the contract shall
        not be effected by means of "setoff" or "ring" settlement, but
        only by the actual transfer of the specified cotton mentioned
        in the contract.
      (2) Incorporation of conditions in contract
        The provisions of paragraphs (1)(A), (C), and (D) shall be
      deemed fully incorporated into any such contract if there be
      written or printed thereon, or on the document or memorandum
      evidencing the same, at or prior to the time the same is entered
      into, the words "Subject to United States Cotton Futures Act,
      subsection (h)".
      (3) Application of subsection
        This subsection shall not be construed to apply to any contract
      of sale made in compliance with subsection (f) or (g) of this
      section.
    (i) Liability of principal for acts of agent
      When construing and enforcing the provisions of this section, the
    act, omission, or failure of any official, agent, or other person
    acting for or employed by any association, partnership, or
    corporation within the scope of his employment or office shall, in
    every case, also be deemed the act, omission, or failure of such
    association, partnership, or corporation, as well as that of the
    person.
    (j) Regulations
      The Secretary is authorized to make such regulations with the
    force and effect of law as he determines may be necessary to carry
    out the provisions of this section and the powers vested in him by
    this section.
    (k) Violations
      Any person who knowingly violates any regulation made in
    pursuance of this section, shall, upon conviction thereof, be fined
    not less than $100 nor more than $500, for each violation thereof,
    in the discretion of the court, and, in case of natural persons,
    may, in addition be punished by imprisonment for not less than 30
    days nor more than 90 days, for each violation, in the discretion
    of the court except that this subsection shall not apply to
    violations subject to subsection (d)(3) of this section.
    (l) Applicability to contracts prior to effective date
      The provisions of this section shall not apply to any cotton
    futures contract entered into prior to the effective date of this
    section or to any act or failure to act by any person prior to such
    effective date and all such prior contracts, acts or failure to act
    shall continue to be governed by the applicable provisions of the
    Internal Revenue Code of 1954 (!1) as in effect prior to the
    enactment of this section. All designations of bona fide spot
    markets and all rules and regulations issued by the Secretary
    pursuant to the applicable provisions of the Internal Revenue Code
    of 1954 (!1) which were in effect on the effective date of this
    section, shall remain fully effective as designations and
    regulations under this section until superseded, amended, or
    terminated by the Secretary.
    (m) Authorization
      There are authorized to be appropriated such sums as may be
    necessary to carry out this section.

-SOURCE-
    (Pub. L. 94-455, title XIX, Sec. 1952(a)-(m), Oct. 4, 1976, 90
    Stat. 1841-1846; Pub. L. 97-35, title I, Sec. 156(c), Aug. 13,
    1981, 95 Stat. 374; Pub. L. 102-237, title I, Sec. 123, Dec. 13,
    1991, 105 Stat. 1844; Pub. L. 106-472, title III, Sec. 311, Nov. 9,
    2000, 114 Stat. 2076.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Commodity Exchange Act, referred to in subsec. (c)(1), is act
    Sept. 21, 1922, ch. 369, 42 Stat. 998, as amended, which is
    classified generally to chapter 1 (Sec. 1 et seq.) of this title.
    For complete classification of this Act to the Code, see section 1
    of this title and Tables.
      The United States Cotton Standards Act, as amended, referred to
    in subsec. (c)(5), is act Mar. 4, 1923, ch. 288, 42 Stat. 1517, as
    amended, which is classified generally to chapter 2 (Sec. 51 et
    seq.) of this title. For complete classification of this Act to the
    Code, see section 51 of this title and Tables.
      The Federal Property and Administrative Services Act of 1949,
    referred to in subsec. (f)(1)(G), is act June 30, 1949, ch. 288, 63
    Stat. 377, as amended. Except for title III of the Act, which is
    classified generally to subchapter IV (Sec. 251 et seq.) of chapter
    4 of Title 41, Public Contracts, the Act was repealed and reenacted
    by Pub. L. 107-217, Secs. 1, 6(b), Aug. 21, 2002, 116 Stat. 1062,
    1304, as chapters 1 to 11 of Title 40, Public Buildings, Property,
    and Works.
      The Internal Revenue Code of 1954, referred to in subsec. (l),
    was redesignated the Internal Revenue Code of 1986 by Pub. L. 99-
    514, Sec. 2, Oct. 22, 1986, 100 Stat. 2095, and is classified to
    Title 26, Internal Revenue Code.

-COD-
                               CODIFICATION                           
      Section was enacted as part of the Tax Reform Act of 1976, and
    not as part of the Commodity Exchange Act which comprises this
    chapter.
      This section, referred to in subsec. (c)(1), was in the original
    a reference to this "Act", meaning the United States Cotton Futures
    Act, which comprises this section.

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (d)(2). Pub. L. 106-472 inserted at end "A person
    complying with the preceding sentence shall not be liable for any
    loss or damage arising or resulting from such compliance."
      1991 - Subsec. (c)(1). Pub. L. 102-237 inserted before period at
    end ", except that any cotton futures contract that, by its terms,
    is settled in cash is excluded from the coverage of this paragraph
    and section".
      1981 - Subsec. (f)(1)(G). Pub. L. 97-35 inserted provisions
    relating to crediting to account referred to in section 55 of this
    title and provisions respecting cotton samples submitted or used
    becoming the property of the United States.

                     EFFECTIVE DATE OF 1981 AMENDMENT                 
      Amendment by Pub. L. 97-35 effective Oct. 1, 1981, see section
    156(e) of Pub. L. 97-35, set out as an Effective Date note under
    section 61a of this title.

                              EFFECTIVE DATE                          
      Section 1952(o) of Pub. L. 94-455 provided that: "The provisions
    of this section [enacting this section, amending section 6808 of
    Title 26, Internal Revenue Code, and repealing sections 7233 and
    7263, subchapter D of chapter 39, and subchapter E of chapter 76 of
    Title 26] shall take effect on the 90th day after the date of
    enactment of this Act [Oct. 4, 1976]."

-FOOTNOTE-
    (!1) See References in Text note below.

    (!2) So in original. Probably should be "basis".

-End-

-CITE-
    7 USC Sec. 16                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 16. Commission operations

-STATUTE-
    (a) Cooperation with other agencies
      The Commission may cooperate with any Department or agency of the
    Government, any State, territory, district, or possession, or
    department, agency, or political subdivision thereof, any foreign
    futures authority, any department or agency of a foreign government
    or political subdivision thereof, or any person.
    (b) Employment of investigators, experts, Administrative Law
      Judges, consultants, clerks, and other personnel; contracts
      (1) The Commission shall have the authority to employ such
    investigators, special experts, Administrative Law Judges, clerks,
    and other employees as it may from time to time find necessary for
    the proper performance of its duties and as may be from time to
    time appropriated for by Congress.
      (2) The Commission may employ experts and consultants in
    accordance with section 3109 of title 5, and compensate such
    persons at rates not in excess of the maximum daily rate prescribed
    for GS-18 under section 5332 of title 5.
      (3) The Commission shall also have authority to make and enter
    into contracts with respect to all matters which in the judgment of
    the Commission are necessary and appropriate to effectuate the
    purposes and provisions of this chapter, including, but not limited
    to, the rental of necessary space at the seat of Government and
    elsewhere.
      (4) The Commission may request (in accordance with the procedures
    set forth in subchapter II of chapter 31 of title 5) and the Office
    of Personnel Management shall authorize pursuant to the request,
    eight positions in the Senior Executive Service in addition to the
    number of such positions authorized for the Commission on October
    28, 1992.
    (c) Expenses
      All of the expenses of the Commissioners, including all necessary
    expenses for transportation incurred by them while on official
    business of the Commission, shall be allowed and paid on the
    presentation of itemized vouchers therefor approved by the
    Commission.
    (d) Authorization of appropriations
      There are authorized to be appropriated such sums as are
    necessary to carry out this chapter for each of fiscal years 1995
    through 2005.
    (e) Relation to other law, departments, or agencies
      (1) Nothing in this chapter shall supersede or preempt - 
        (A) criminal prosecution under any Federal criminal statute;
        (B) the application of any Federal or State statute (except as
      provided in paragraph (2)), including any rule or regulation
      thereunder, to any transaction in or involving any commodity,
      product, right, service, or interest - 
          (i) that is not conducted on or subject to the rules of a
        registered entity or exempt board of trade;
          (ii) (except as otherwise specified by the Commission by rule
        or regulation) that is not conducted on or subject to the rules
        of any board of trade, exchange, or market located outside the
        United States, its territories or possessions; or
          (iii) that is not subject to regulation by the Commission
        under section 6c or 23 of this title; or

        (C) the application of any Federal or State statute, including
      any rule or regulation thereunder, to any person required to be
      registered or designated under this chapter who shall fail or
      refuse to obtain such registration or designation.

      (2) This chapter shall supersede and preempt the application of
    any State or local law that prohibits or regulates gaming or the
    operation of bucket shops (other than antifraud provisions of
    general applicability) in the case of - 
        (A) an electronic trading facility excluded under section 2(e)
      of this title; and
        (B) an agreement, contract, or transaction that is excluded
      from this chapter under section 2(c), 2(d), 2(f), or 2(g) of this
      title or sections 27 to 27f of this title, or exempted under
      section 2(h) or 6(c) of this title (regardless of whether any
      such agreement, contract, or transaction is otherwise subject to
      this chapter).
    (f) Investigative assistance to foreign futures authorities
      (1) On request from a foreign futures authority, the Commission
    may, in its discretion, provide assistance in accordance with this
    section if the requesting authority states that the requesting
    authority is conducting an investigation which it deems necessary
    to determine whether any person has violated, is violating, or is
    about to violate any laws, rules or regulations relating to futures
    or options matters that the requesting authority administers or
    enforces. The Commission may conduct such investigation as the
    Commission deems necessary to collect information and evidence
    pertinent to the request for assistance. Such assistance may be
    provided without regard to whether the facts stated in the request
    would also constitute a violation of the laws of the United States.
      (2) In deciding whether to provide assistance under this
    subsection, the Commission shall consider whether - 
        (A) the requesting authority has agreed to provide reciprocal
      assistance to the Commission in futures and options matters; and
        (B) compliance with the request would prejudice the public
      interest of the United States.

      (3) Notwithstanding any other provision of law, the Commission
    may accept payment and reimbursement, in cash or in kind, from a
    foreign futures authority, or made on behalf of such authority, for
    necessary expenses incurred by the Commission, its members, and
    employees in carrying out any investigation, or in providing any
    other assistance to a foreign futures authority, pursuant to this
    section. Any payment or reimbursement accepted shall be considered
    a reimbursement to the appropriated funds of the Commission.
    (g) Computerized futures trading
      Consistent with its responsibilities under section 22 of this
    title, the Commission is directed to facilitate the development and
    operation of computerized trading as an adjunct to the open outcry
    auction system. The Commission is further directed to cooperate
    with the Office of the United States Trade Representative, the
    Department of the Treasury, the Department of Commerce, and the
    Department of State in order to remove any trade barriers that may
    be imposed by a foreign nation on the international use of
    electronic trading systems.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 12, 42 Stat. 1003; Pub. L. 93-463,
    title I, Sec. 101(b), Oct. 23, 1974, 88 Stat. 1391; Pub. L. 95-405,
    Sec. 20, Sept. 30, 1978, 92 Stat. 875; Pub. L. 97-444, title II,
    Secs. 228, 229, Jan. 11, 1983, 96 Stat. 2318; Pub. L. 99-641, title
    I, Sec. 106, Nov. 10, 1986, 100 Stat. 3558; Pub. L. 102-546, title
    II, Secs. 216, 220(a), title III, Secs. 302, 303, title IV, Sec.
    401, title V, Sec. 502(c), Oct. 28, 1992, 106 Stat. 3611, 3614,
    3622, 3624, 3631; Pub. L. 104-9, Sec. 2, Apr. 21, 1995, 109 Stat.
    154; Pub. L. 106-554, Sec. 1(a)(5) [title I, Secs. 116, 117], Dec.
    21, 2000, 114 Stat. 2763, 2763A-402.)

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (d). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    116], substituted "2005" for "2000".
      Subsec. (e). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 117],
    added subsec. (e) and struck out former subsec. (e) which provided
    that this chapter did not supersede or preempt criminal
    prosecutions under Federal criminal statutes or the application of
    any Federal or State statute to certain specified transactions and
    persons.
      1995 - Subsec. (d). Pub. L. 104-9 amended subsec. (d) generally.
    Prior to amendment, subsec. (d) read as follows: "There are
    authorized to be appropriated to carry out this chapter - 
        "(1) $53,000,000 for fiscal year 1993; and
        "(2) $60,000,000 for fiscal year 1994."
      1992 - Subsec. (a). Pub. L. 102-546, Sec. 302, inserted "any
    foreign futures authority, any department or agency of a foreign
    government or political subdivision thereof," after "thereof,".
      Subsec. (b). Pub. L. 102-546, Sec. 216, designated first through
    third sentences as pars. (1) to (3), respectively, and added par.
    (4).
      Subsec. (d). Pub. L. 102-546, Sec. 401, amended subsec. (d)
    generally. Prior to amendment, subsec. (d) read as follows: "There
    are authorized to be appropriated to carry out this chapter such
    sums as may be necessary for each of the fiscal years during the
    period beginning October 1, 1986, and ending September 30, 1989."
      Subsec. (e)(2)(A). Pub. L. 102-546, Sec. 502(c), inserted "or, in
    the case of any State or local law that prohibits or regulates
    gaming or the operation of 'bucket shops' (other than antifraud
    provisions of general applicability), that is not a transaction or
    class of transactions that has received or is covered by the terms
    of any exemption previously granted by the Commission under
    subsection (c) of section 6 of this title," after "market,".
      Subsec. (f). Pub. L. 102-546, Sec. 303, added subsec. (f).
      Subsec. (g). Pub. L. 102-546, Sec. 220(a), added subsec. (g).
      1986 - Subsec. (d). Pub. L. 99-641 amended subsec. (d) generally.
    Prior to amendment, subsec. (d) read as follows: "There are
    authorized to be appropriated to carry out the provisions of this
    chapter such sums as may be required for each of the fiscal years
    during the period beginning October 1, 1982, and ending September
    30, 1986."
      1983 - Subsec. (d). Pub. L. 97-444, Sec. 228, substituted
    appropriation authorization for fiscal years during period
    beginning Oct. 1, 1982, and ending Sept. 30, 1986, for prior
    authorization for fiscal years during period beginning Oct. 1,
    1978, and ending Sept. 30, 1982.
      Subsec. (e). Pub. L. 97-444, Sec. 229, added subsec. (e).
      1978 - Subsec. (d). Pub. L. 95-405 substituted "for each of the
    fiscal years during the period beginning October 1, 1978, and
    ending September 30, 1982" for "for the fiscal year ending June 30,
    1975, for the fiscal year ending June 30, 1976, for the fiscal year
    ending June 30, 1977, and for the fiscal year ending June 30,
    1978".
      1974 - Pub. L. 93-463 designated existing unlettered provisions
    as subsecs. (a) to (d), substituted "Commission" for "Secretary of
    Agriculture", inserted provisions authorizing the expenditure of
    funds for expenses upon the presentation of itemized vouchers
    therefor approved by the Commission, substituted provisions
    authorizing appropriations specifically for fiscal years ending
    June 30, 1975, 1976, 1977, and 1978, for provisions making a
    general authorization of appropriations without a fiscal year
    limitation, and inserted authorization to enter into contracts and
    compensate experts and consultants in accordance with section 3109
    of title 5 at rates not in excess of the maximum daily rate
    prescribed for GS-18 under section 5332 of title 5.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1974 AMENDMENT                 
      For effective date of amendment by Pub. L. 93-463, see section
    418 of Pub. L. 93-463, set out as a note under section 2 of this
    title.

          REFERENCES IN OTHER LAWS TO GS-16, 17, OR 18 PAY RATES      
      References in laws to the rates of pay for GS-16, 17, or 18, or
    to maximum rates of pay under the General Schedule, to be
    considered references to rates payable under specified sections of
    Title 5, Government Organization and Employees, see section 529
    [title I, Sec. 101(c)(1)] of Pub. L. 101-509, set out in a note
    under section 5376 of Title 5.

-End-

-CITE-
    7 USC Sec. 16a                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 16a. Service fees and National Futures Association study

-STATUTE-
    (a) Development and implementation of plan for user fees; report to
      and approval by Congressional committees
      Notwithstanding any other provision of law, the Commodity Futures
    Trading Commission may develop and implement a plan to charge and
    collect reasonable fees to cover the estimated cost of regulating
    transactions under the jurisdiction of the Commission. However,
    prior to implementing such a plan, the Commission shall report its
    intention to do so to the House Committee on Agriculture and the
    Senate Committee on Agriculture, Nutrition, and Forestry. The
    Commission shall include in its report the feasibility and
    desirability of collecting such fees. Any plan developed under this
    section shall not be implemented until approved by the House
    Committee on Agriculture and the Senate Committee on Agriculture,
    Nutrition, and Forestry. Fees collected under any plan approved
    under this section shall be deposited in the Treasury of the United
    States as miscellaneous receipts.
    (b) National Futures Association regulatory experience; report;
      contents
      The Commodity Futures Trading Commission shall submit to Congress
    a report containing the results of a study of the regulatory
    experience of the National Futures Association for the period
    beginning January 1, 1983 and ending September 30, 1985. The report
    shall be submitted not later than January 1, 1986. The report shall
    include (but not to be limited to) the following - 
        (1) the extent to which the National Futures Association has
      fully implemented the program provided in the rules approved by
      the Commission under section 17(p) and (q) of the Commodity
      Exchange Act [7 U.S.C. 21(p), (q)] and the effectiveness of the
      operation of such program;
        (2) the actual and projected cost savings to the Federal
      Government, if any, resulting from operations of the National
      Futures Association;
        (3) the actual and projected costs which the Commission and the
      public would have incurred if the Association had not undertaken
      self-regulatory responsibility for certain areas under the
      Commission's jurisdiction;
        (4) problem areas, if any, encountered by the Association;
        (5) the nature of the working relationship between the
      Association and the Commission;
        (6) an assessment of the actual and projected efficiencies the
      Commission has achieved or expects to be achieved as a result of
      the continuing regulatory activities of the Association; and
        (7) the immediate and projected capabilities of the Commission
      at the time of submission of the study to turn its attention to
      more immediate problems of regulation, as a result of the
      activities of the Association.
    (c) Schedule of fees for services, activities and functions; notice
      and hearing; actual cost standard
      Nothing in this section shall limit the authority of the
    Commission to promulgate, after notice and opportunity for hearing,
    a schedule of appropriate fees to be charged for services rendered
    and activities and functions performed by the Commission in
    conjunction with its administration and enforcement of the
    Commodity Exchange Act [7 U.S.C. 1 et seq.]: Provided, That the
    fees for any specified service or activity or function shall not
    exceed the actual cost thereof to the Commission.

-SOURCE-
    (Pub. L. 95-405, Sec. 26, Sept. 30, 1978, 92 Stat. 877; Pub. L. 97-
    444, title II, Sec. 237, Jan. 11, 1983, 96 Stat. 2325.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Commodity Exchange Act, referred to in subsec. (c), is act
    Sept. 21, 1922, ch. 369, 42 Stat. 998, as amended, which is
    classified generally to chapter 1 (Sec. 1 et seq.) of this title.
    For complete classification of this Act to the Code, see section 1
    of this title and Tables.

-COD-
                               CODIFICATION                           
      Section was enacted as part of the Futures Trading Act of 1978,
    and not as part of the Commodity Exchange Act which comprises this
    chapter.

-MISC1-
                                AMENDMENTS                            
      1983 - Pub. L. 97-444 designated existing provisions as subsec.
    (a) and added subsecs. (b) and (c).

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      Section effective Oct. 1, 1978, see section 28 of Pub. L. 95-405,
    set out as an Effective Date of 1978 Amendment note under section 2
    of this title.

                   STUDY OF ASSESSMENTS ON TRANSACTIONS               
      Pub. L. 102-546, title II, Sec. 218, Oct. 28, 1992, 106 Stat.
    3612, provided that:
      "(a) Study. - The Comptroller General of the United States shall
    conduct a study to determine whether - 
        "(1) it is feasible to fund some or all of the enforcement and
      market surveillance activities of the Commodity Futures Trading
      Commission, as required by the amendments to the Commodity
      Exchange Act made by the Futures Trading Practices Act of 1992
      [see Short Title of 1992 Amendment note set out under section 1
      of this title], through the imposition of an assessment on
      commodity futures and options transactions executed pursuant to
      the Commodity Exchange Act [7 U.S.C. 1 et seq.]; and
        "(2) a program of assessment-based funding for some or all of
      such enforcement and market surveillance activities would better
      provide resources to the Commodity Futures Trading Commission to
      enable the Commission to - 
          "(A) protect the interests of market users (including hedgers
        and speculators), producers of commodities traded on the
        futures markets, and the general public; and
          "(B) maintain and enhance the credibility of such futures and
        options markets.
      "(b) Report. - Not later than one year after the date of
    enactment of this Act [Oct. 28, 1992], the Comptroller General
    shall submit to the Committee on Agriculture of the House of
    Representatives and the Committee on Agriculture, Nutrition, and
    Forestry of the Senate a report containing the Comptroller
    General's determinations pursuant to subsection (a), together with
    any appropriate recommendations for the implementation of such a
    program of assessment-based funding for some or all of the
    Commodity Futures Trading Commission's enforcement and market
    surveillance activities."

-End-

-CITE-
    7 USC Sec. 17                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 17. Separability

-STATUTE-
      If any provision of this chapter or the application thereof to
    any person or circumstances is held invalid, the validity of the
    remainder of the chapter and of the application of such provision
    to other persons and circumstances shall not be affected thereby.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 10, 42 Stat. 1003.)

-End-

-CITE-
    7 USC Sec. 17a                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 17a. Separability of 1936 amendment

-STATUTE-
      If any provision of the act of June 15, 1936, ch. 545, 49 Stat.
    1491, which amends this chapter, or the application thereof to any
    person or circumstances is held invalid, the provisions of the
    section of this chapter which is amended by such provision of said
    act shall apply to such person or circumstances. No proceeding
    shall be abated by reason of any amendment to this chapter made by
    said act but shall be disposed of pursuant to said act.

-SOURCE-
    (June 15, 1936, ch. 545, Sec. 12, 49 Stat. 1501.)

-COD-
                               CODIFICATION                           
      Section was not enacted as part of the Commodity Exchange Act
    which comprises this chapter.

-MISC1-
                              EFFECTIVE DATE                          
      For effective date of section, see section 13 of act June 15,
    1936, set out as an Effective Date of 1936 Amendment note under
    section 1 of this title.

-End-

-CITE-
    7 USC Sec. 17b                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 17b. Separability of 1968 amendment

-STATUTE-
      If any provision of this Act or the application thereof to any
    person or circumstances is held invalid, the validity of the
    remainder of the Act and the application of such provision to other
    persons or circumstances shall not be affected thereby, and the
    provisions of the section of this chapter which is amended by such
    provision of this Act shall apply to such person or circumstances.
    Pending proceedings shall not be abated by reason of any provision
    of this Act but shall be disposed of pursuant to the provisions of
    this chapter, in effect prior to the effective date of this Act.

-SOURCE-
    (Pub. L. 90-258, Sec. 27, Feb. 19, 1968, 82 Stat. 34.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      This Act, referred to in text, is Pub. L. 90-258, Feb. 19, 1968,
    82 Stat. 26. For complete classification of this Act to the Code,
    see Tables.
      Effective date of this Act, referred to in text, as one hundred
    and twenty days after Feb. 19, 1968, see section 28 of Pub. L. 90-
    258, set out as an Effective Date of 1968 Amendment note under
    section 2 of this title.

-COD-
                               CODIFICATION                           
      Section was not enacted as part of the Commodity Exchange Act
    which comprises this chapter.

-End-

-CITE-
    7 USC Sec. 18                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 18. Complaints against registered persons

-STATUTE-
    (a) Petition for actual damages
      (1) Any person complaining of any violation of any provision of
    this chapter, or any rule, regulation, or order issued pursuant to
    this chapter, by any person who is registered under this chapter
    may, at any time within two years after the cause of action
    accrues, apply to the Commission for an order awarding - 
        (A) actual damages proximately caused by such violation. If an
      award of actual damages is made against a floor broker in
      connection with the execution of a customer order, and the
      futures commission merchant which selected the floor broker for
      the execution of the customer order is held to be responsible
      under section 2(a)(1) of this title for the floor broker's
      violation, such futures commission merchant may be required to
      satisfy such award; and
        (B) in the case of any action arising from a willful and
      intentional violation in the execution of an order on the floor
      of a registered entity, punitive or exemplary damages equal to no
      more than two times the amount of such actual damages. If an
      award of punitive or exemplary damages is made against a floor
      broker in connection with the execution of a customer order, and
      the futures commission merchant which selected the floor broker
      for the execution of the customer order is held to be responsible
      under section 2(a)(1) of this title for the floor broker's
      violation, such futures commission merchant may be required to
      satisfy such award if the floor broker fails to do so, except
      that such requirement shall apply to the futures commission
      merchant only if it willfully and intentionally selected the
      floor broker with the intent to assist or facilitate the floor
      broker's violation.

      (2)(A) An action may be brought under this subsection by any one
    or more persons described in this subsection for and in behalf of
    such person or persons and other persons similarly situated, if the
    Commission permits such actions pursuant to a final rule issued by
    the Commission.
      (B) Not later than two hundred and seventy days after October 28,
    1992, the Commission shall propose and publish for public comment
    such rules as are necessary to carry out subparagraph (A). In
    developing such rules, the Commission shall consider the potential
    impact of such actions on resources available to the reparations
    system established under this chapter and the relative merits of
    bringing such actions in Federal court.
    (b) Rules and regulations; control over right of appeal
      The Commission may promulgate such rules, regulations, and orders
    as it deems necessary or appropriate for the efficient and
    expeditious administration of this section. Notwithstanding any
    other provision of law, such rules, regulations, and orders may
    prescribe, or otherwise condition, without limitation, the form,
    filing, and service of pleadings or orders, the nature and scope of
    discovery, counterclaims, motion practice (including the grounds
    for dismissal of any claim or counterclaim), hearings (including
    the waiver thereof, which may relate to the amount in controversy),
    rights of appeal, if any, and all other matters governing
    proceedings before the Commission under this section.
    (c) Bond requirement when complainant is nonresident; waiver
      In case a complaint is made by a nonresident of the United
    States, the complainant shall be required, before any formal action
    is taken on his complaint, to furnish a bond in double the amount
    of the claim conditioned upon the payment of costs, including a
    reasonable attorney's fee for the respondent if the respondent
    shall prevail, and any reparation award that may be issued by the
    Commission against the complainant on any counterclaim by
    respondent: Provided, That the Commission shall have authority to
    waive the furnishing of a bond by a complainant who is a resident
    of a country which permits the filing of a complaint by a resident
    of the United States without the furnishing of a bond.
    (d) Enforcement of reparation award
      If any person against whom an award has been made does not pay
    the reparation award within the time specified in the Commission's
    order, the complainant, or any person for whose benefit such order
    was made, within three years of the date of the order, may file a
    certified copy of the order of the Commission, in the district
    court of the United States for the district in which he resides or
    in which is located the principal place of business of the
    respondent, for enforcement of such reparation award by appropriate
    orders. The orders, writs, and processes of such district court may
    in such case run, be served, and be returnable anywhere in the
    United States. The petitioner shall not be liable for costs in the
    district court, nor for costs at any subsequent state of the
    proceedings, unless they accrue upon his appeal. If the petitioner
    finally prevails, he shall be allowed a reasonable attorney's fee,
    to be taxed and collected as a part of the costs of the suit.
    Subject to the right of appeal under subsection (e) of this
    section, an order of the Commission awarding reparations shall be
    final and conclusive.
    (e) Review
      Any order of the Commission entered hereunder shall be reviewable
    on petition of any party aggrieved thereby, by the United States
    Court of Appeals for any circuit in which a hearing was held, or if
    no hearing was held, any circuit in which the appellee is located,
    under the procedure provided in sections 9 and 15 of this title.
    Such appeal shall not be effective unless within 30 days from and
    after the date of the reparation order the appellant also files
    with the clerk of the court a bond in double the amount of the
    reparation awarded against the appellant conditioned upon the
    payment of the judgment entered by the court, plus interest and
    costs, including a reasonable attorney's fee for the appellee, if
    the appellee shall prevail. Such bond shall be in the form of cash,
    negotiable securities having a market value at least equivalent to
    the amount of bond prescribed, or the undertaking of a surety
    company on the approved list of sureties issued by the Treasury
    Department of the United States. The appellee shall not be liable
    for costs in said court. If the appellee prevails, he shall be
    allowed a reasonable attorney's fee to be taxed and collected as a
    part of his costs.
    (f) Automatic bar from trading and suspension for noncompliance;
      effect of appeal
      Unless the party against whom a reparation order has been issued
    shows to the satisfaction of the Commission within fifteen days
    from the expiration of the period allowed for compliance with such
    order that either an appeal as herein authorized has been taken or
    payment of the full amount of the order (or any agreed settlement
    thereof) has been made, such party shall be prohibited
    automatically from trading on all registered entities and, if the
    party is registered with the Commission, such registration shall be
    suspended automatically at the expiration of such fifteen-day
    period until such party shows to the satisfaction of the Commission
    that payment of such amount with interest thereon to date of
    payment has been made: Provided, That if on appeal the appellee
    prevails or if the appeal is dismissed, the automatic prohibition
    against trading and suspension of registration shall become
    effective at the expiration of thirty days from the date of
    judgment on the appeal, but if the judgment is stayed by a court of
    competent jurisdiction, the suspension shall become effective ten
    days after the expiration of such stay, unless prior thereto the
    judgment of the court has been satisfied.
    (g) Predispute resolution agreements for institutional customers
      Nothing in this section prohibits a registered futures commission
    merchant from requiring a customer that is an eligible contract
    participant, as a condition to the commission merchant's conducting
    a transaction for the customer, to enter into an agreement waiving
    the right to file a claim under this section.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 14, as added Pub. L. 93-463, title
    I, Sec. 106, Oct. 23, 1974, 88 Stat. 1393; amended Pub. L. 94-16,
    Sec. 3, Apr. 16, 1975, 89 Stat. 77; Pub. L. 95-405, Sec. 21, Sept.
    30, 1978, 92 Stat. 875; Pub. L. 97-444, title II, Sec. 231, Jan.
    11, 1983, 96 Stat. 2319; Pub. L. 102-546, title II, Secs.
    209(b)(7), 222(b), 224, title IV, Sec. 402(11), Oct. 28, 1992, 106
    Stat. 3607, 3615, 3617, 3625; Pub. L. 106-554, Sec. 1(a)(5) [title
    I, Secs. 118, 123(a)(23)], Dec. 21, 2000, 114 Stat. 2763, 2763A-
    403, 2763A-410.)

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (a)(1)(B). Pub. L. 106-554, Sec. 1(a)(5) [title I,
    Sec. 123(a)(23)(A)], substituted "registered entity" for " contract
    market".
      Subsec. (f). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(23)(B)], substituted "registered entities" for " contract
    markets".
      Subsec. (g). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 118],
    added subsec. (g) and struck out former subsec. (g) which read as
    follows: "The provisions of this section shall not become effective
    until fifteen months after October 23, 1974: Provided, That claims
    which arise within one year immediately prior to the effective date
    of this section may be heard by the Commission after such 15-month
    period."
      1992 - Subsec. (a). Pub. L. 102-546, Sec. 224, designated
    existing provisions as par. (1), redesignated former pars. (1) and
    (2) as subpars. (A) and (B), respectively, and added par. (2).
      Pub. L. 102-546, Sec. 222(b), substituted "awarding - " and pars.
    (1) and (2) for "awarding actual damages proximately caused by such
    violation."
      Subsec. (e). Pub. L. 102-546, Sec. 209(b)(7), made technical
    amendment to reference to sections 9 and 15 of this title to
    reflect change in reference to corresponding section of original
    act.
      Subsec. (g). Pub. L. 102-546, Sec. 402(11), substituted "15-
    month" for second reference to "fifteen months".
      1983 - Subsec. (a). Pub. L. 97-444, Sec. 231(1), substituted
    provisions relating to complaints against violations by persons
    "registered under this chapter" for provisions relating to
    complaints against persons "registered or required to be registered
    under section 6d, 6e, 6j, or 6m of this title", and substituted
    provisions for application to Commission for an award of actual
    damages caused by such violation, for provisions authorizing
    application to Commission by petition, and forwarding of complaint,
    if warranted, to respondent for satisfaction or answer.
      Subsec. (b). Pub. L. 97-444, Sec. 231(2), substituted provisions
    relating to promulgation by Commission of rules, regulations, and
    orders necessary or appropriate for administration of this section,
    including rules of practice and procedure governing proceedings
    before the Commission, for provisions relating to investigation and
    service of complaint by Commission, and hearing thereon before an
    Administrative Law Judge, except that where amount claimed as
    damages did not exceed $5,000, hearing need not be held, and proofs
    could be supplied by deposition or verified statements of fact.
      Subsec. (c). Pub. L. 97-444, Sec. 231(3), (4), redesignated
    subsec. (d) as (c). Former subsec. (c), which provided that after
    opportunity for hearing on complaints where the damages claimed
    exceeded the sum of $5,000 had been provided or waived and on
    complaints where damages claimed did not exceed the sum of $5,000
    not requiring hearing as provided herein, Commission would
    determine whether or not the respondent had violated any provision
    of this chapter or any rule, regulation, or order thereunder, was
    struck out.
      Subsec. (d). Pub. L. 97-444, Sec. 231(4), (5), redesignated
    subsec. (f) as (d) and substituted "subsection (e)" for "subsection
    (g)". Former subsec. (d) was redesignated (c).
      Subsec. (e). Pub. L. 97-444, Sec. 231(3), (4), redesignated
    subsec. (g) as (e). Former subsec. (e), which provided that if,
    after a hearing on a complaint made by any person under subsection
    (a) of this section, or without hearing as provided in subsections
    (b) and (c) of this section, or upon failure of the party
    complained against to answer a complaint duly served within the
    time prescribed, or to appear at a hearing after being duly
    notified, the Commission determined that the respondent had
    violated any provision of this chapter, or any rule, regulation, or
    order thereunder, the Commission would unless the offender had
    already made reparation to the person complaining, determine the
    amount of damage, if any, to which such person was entitled as a
    result of such violation and would make an order directing the
    offender to pay to such person complaining such amount on or before
    the date fixed in the order, and that if, after the respondent had
    filed his answer to the complaint, it appeared therein that the
    respondent had admitted liability for a portion of the amount
    claimed in the complaint as damages, the Commission under such
    rules and regulations as it would prescribe, unless the respondent
    had already made reparation to the person complaining, could issue
    an order directing the respondent to pay to the complainant the
    undisputed amount on or before the date fixed in the order, leaving
    the respondent's liability for the disputed amount for subsequent
    determination, with the remaining disputed amount to be determined
    in the same manner and under the same procedure as it would have
    been determined if no order had been issued by the Commission with
    respect to the undisputed sum, was struck out.
      Subsec. (f). Pub. L. 97-444, Sec. 231(4), (6), redesignated
    subsec. (h) as (f), made certain grammatical changes, and inserted
    provision allowing party against whom a reparation order has been
    issued to show compliance by payment of the full amount of the
    order or any agreed settlement thereof.
      Subsecs. (g) to (i). Pub. L. 97-444, Sec. 231(4), redesignated
    subsecs. (g), (h), and (i), as (e), (f), and (g), respectively.
      1978 - Subsec. (a). Pub. L. 95-405, Sec. 21(1), substituted "who
    is registered or required to be registered" for "registered".
      Subsecs. (b), (c). Pub. L. 95-405, Sec. 21(2), (3), substituted
    "$5,000" for "$2,500" wherever appearing.
      1975 - Subsec. (i). Pub. L. 94-16 substituted "fifteen months"
    for "one year" in two places, and "one year" for "nine months".

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective 120 days after Jan. 11,
    1983, or such earlier date as the Commission shall prescribe by
    regulation, see section 239 of Pub. L. 97-444, set out as a note
    under section 2 of this title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

-End-

-CITE-
    7 USC Sec. 19                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 19. Consideration of costs and benefits and antitrust laws

-STATUTE-
    (a) Costs and benefits
      (1) In general
        Before promulgating a regulation under this chapter or issuing
      an order (except as provided in paragraph (3)), the Commission
      shall consider the costs and benefits of the action of the
      Commission.
      (2) Considerations
        The costs and benefits of the proposed Commission action shall
      be evaluated in light of - 
          (A) considerations of protection of market participants and
        the public;
          (B) considerations of the efficiency, competitiveness, and
        financial integrity of futures markets;
          (C) considerations of price discovery;
          (D) considerations of sound risk management practices; and
          (E) other public interest considerations.
      (3) Applicability
        This subsection does not apply to the following actions of the
      Commission:
          (A) An order that initiates, is part of, or is the result of
        an adjudicatory or investigative process of the Commission.
          (B) An emergency action.
          (C) A finding of fact regarding compliance with a requirement
        of the Commission.
    (b) Antitrust laws
      The Commission shall take into consideration the public interest
    to be protected by the antitrust laws and endeavor to take the
    least anticompetitive means of achieving the objectives of this
    chapter, as well as the policies and purposes of this chapter, in
    issuing any order or adopting any Commission rule or regulation
    (including any exemption under section 6(c) or 6c(b) of this
    title), or in requiring or approving any bylaw, rule, or regulation
    of a contract market or registered futures association established
    pursuant to section 21 of this title.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 15, as added Pub. L. 93-463, title
    I, Sec. 107, Oct. 23, 1974, 88 Stat. 1395; amended Pub. L. 102-546,
    title V, Sec. 502(b), Oct. 28, 1992, 106 Stat. 3631; Pub. L. 106-
    554, Sec. 1(a)(5) [title I, Sec. 119], Dec. 21, 2000, 114 Stat.
    2763, 2763A-403.)

-MISC1-
                                AMENDMENTS                            
      2000 - Pub. L. 106-554 inserted section catchline, added subsec.
    (a), designated existing provisions as subsec. (b), and inserted
    subsec. (b) heading.
      1992 - Pub. L. 102-546 substituted "regulation (including any
    exemption under section 6(c) or 6c(b) of this title)" for
    "regulation".

                              EFFECTIVE DATE                          
      For effective date of section, see section 418 of Pub. L. 93-463,
    set out as an Effective Date of 1974 Amendment note under section 2
    of this title.

-End-

-CITE-
    7 USC Sec. 20                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 20. Market reports

-STATUTE-
    (a) Information
      The Commission may conduct regular investigations of the markets
    for goods, articles, services, rights, and interests which are the
    subject of futures contracts, and furnish reports of the findings
    of these investigations to the public on a regular basis. These
    market reports shall, where appropriate, include information on the
    supply, demand, prices, and other conditions in the United States
    and other countries with respect to such goods, articles, services,
    rights, interests, and information respecting the futures markets.
    (b) Avoidance of duplication
      The Commission shall cooperate with the Department of Agriculture
    and any other Department or Federal agency which makes market
    investigations to avoid unnecessary duplication of information-
    gathering activities.
    (c) Furnishing of information; confidentiality
      The Department of Agriculture and any other Department or Federal
    agency which has market information sought by the Commission shall
    furnish it to the Commission upon the request of any authorized
    employee of the Commission. The Commission shall abide by any rules
    of confidentiality applying to such information.
    (d) Disclosure of business transactions, market positions, trade
      secrets, or names of customers
      The Commission shall not disclose in such reports data and
    information which would separately disclose the business
    transactions or market positions of any person and trade secrets or
    names of customers except as provided in section 12 of this title.
    (e) Application
      This section shall not apply to investigations involving any
    security underlying a security futures product.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 16, as added Pub. L. 93-463, title
    IV, Sec. 414, Oct. 23, 1974, 88 Stat. 1414; amended Pub. L. 97-444,
    title II, Sec. 232, Jan. 11, 1983, 96 Stat. 2320; Pub. L. 106-554,
    Sec. 1(a)(5) [title II, Sec. 251(e)], Dec. 21, 2000, 114 Stat.
    2763, 2763A-443.)

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (e). Pub. L. 106-554 added subsec. (e).
      1983 - Subsec. (d). Pub. L. 97-444 prohibited disclosure of
    market positions.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 418 of Pub. L. 93-463,
    set out as an Effective Date of 1974 Amendment note under section 2
    of this title.

               STUDY OF TRADING IN CATTLE FUTURES CONTRACTS           
      Pub. L. 99-641, title I, Sec. 111, Nov. 10, 1986, 100 Stat. 3561,
    provided that:
      "(a) Study. - The Comptroller General of the United States shall
    conduct and complete a comprehensive study of the effect of trading
    in contracts for the future delivery of live cattle on the cash
    market price of live cattle, with particular emphasis on - 
        "(1) whether the reaction of the live cattle futures market to
      the results of the milk production termination program in March
      1986, conducted under section 201(d)(3) of the Agricultural Act
      of 1949 (7 U.S.C. 1446(d)(3)), was based on and accurately
      reflected the then prevailing conditions of supply and demand;
        "(2) the effect of the trading in contracts for the future
      delivery of live cattle on - 
          "(i) the price relationship between feeder cattle and fed
        cattle;
          "(ii) the price discovery process with respect to live
        cattle; and
          "(iii) price competition within the cattle industry;
        "(3) the effect of the use of packer contracts, as a means of
      obtaining slaughter cattle, on the increase in short hedging in
      contracts for the future delivery of live cattle and the effect
      of this increase in short hedging on prices in the futures and
      cash markets;
        "(4) the effect on the ability of the cash markets to
      accurately reflect prevailing conditions of supply and demand if
      packer contracts become the prevalent method of marketing fed
      cattle;
        "(5) whether the present delivery system for contracts for the
      future delivery of live cattle creates any bias (either upward or
      downward) in the cash price for cattle;
        "(6) whether the present delivery system for contracts for the
      future delivery of live cattle creates price volatility during
      the delivery month; and
        "(7) whether there are advantages or disadvantages to a cash
      settlement system in lieu of the present delivery system in the
      case of contracts for the future delivery of live cattle.
      "(b) Reports. - 
        "(1) Preliminary report. - Not later than January 15, 1987, the
      Comptroller General shall submit a preliminary report on the
      results of the study required under subsection (a) to the
      Committee on Agriculture of the House of Representatives and the
      Committee on Agriculture, Nutrition, and Forestry of the Senate.
        "(2) Final report. - Not later than 1 year after the date of
      enactment of this Act [Nov. 10, 1986], the Comptroller General
      shall submit to such committees a detailed final report of the
      results of the study required under subsection (a)."

          POTATO FUTURES STUDY; SUBMISSION OF REPORT TO CONGRESS      
      Pub. L. 95-405, Sec. 27, Sept. 30, 1978, 92 Stat. 877, required,
    within one year of Oct. 1, 1978, Secretary of Agriculture to (1)
    conduct a comprehensive study of marketing of Irish potatoes and of
    making and trading of contracts of sale for future delivery of
    Irish potatoes, including rules and regulations pertaining to such
    trading issued by Commodity Futures Trading Commission or any
    contract market designated by Commission; and (2) submit to each
    House of Congress a detailed report on results of such study, and
    that report should also include any proposals Secretary may have
    concerning any legislation needed to implement such recommendations
    and concerning any modifications and rules and regulations needed
    to improve regulation of such contracts by Commission or any
    contract market designated by Commission.

-End-

-CITE-
    7 USC Sec. 21                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 21. Registered futures associations

-STATUTE-
    (a) Registration statement
      Any association of persons may be registered with the Commission
    as a registered futures association pursuant to subsection (b) of
    this section, under the terms and conditions hereinafter provided
    in this section, by filing with the Commission for review and
    approval a registration statement in such form as the Commission
    may prescribe, setting forth the information, and accompanied by
    the documents, below specified:
        (1) Data as to its organization, membership, and rules of
      procedure, and such other information as the Commission may by
      rules and regulations require as necessary or appropriate in the
      public interest; and
        (2) Copies of its constitution, charter, or articles of
      incorporation or association, with all amendments thereto, and of
      its bylaws, and of any rules or instruments corresponding to the
      foregoing, whatever the name, hereinafter in this section
      collectively referred to as the "rules of the association".
    (b) Standards for registration; Commission findings
      An applicant association shall not be registered as a futures
    association unless the Commission finds, under standards
    established by the Commission, that - 
        (1) such association is in the public interest and that it will
      be able to comply with the provisions of this section and the
      rules and regulations thereunder and to carry out the purposes of
      this section;
        (2) the rules of the association provide that any person
      registered under this chapter, registered entity, or any other
      person designated pursuant to the rules of the Commission as
      eligible for membership may become a member of such association,
      except such as are excluded pursuant to paragraph (3) or (4) of
      this subsection, or a rule of the association permitted under
      this subparagraph. The rules of the association may restrict
      membership in such association on such specified basis relating
      to the type of business done by its members, or on such other
      specified and appropriate basis, as appears to the Commission to
      be necessary or appropriate in the public interest and to
      carryout the purpose of this section. Rules adopted by the
      association may provide that the association may, unless the
      Commission directs otherwise in cases in which the Commission
      finds it appropriate in the public interest so to direct, deny
      admission to, or refuse to continue in such association any
      person if (i) such person, whether prior or subsequent to
      becoming registered as such, or (ii) any person associated within
      the meaning of "associated person" as set forth in section 6k of
      this title, whether prior or subsequent to becoming so
      associated, has been and is suspended or expelled from a
      registered entity or has been and is barred or suspended from
      being associated with all members of such registered entity, for
      violation of any rule of such registered entity;
        (3) the rules of the association provide that, except with the
      approval or at the direction of the Commission in cases in which
      the Commission finds it appropriate in the public interest so to
      approve or direct, no person shall be admitted to or continued in
      membership in such association, if such person - 
          (A) has been and is suspended or expelled from a registered
        futures association or from a registered entity or has been and
        is barred or suspended from being associated with all members
        of such association or from being associated with all members
        of such registered entity, for violation of any rule of such
        association or registered entity which prohibits any act or
        transaction constituting conduct inconsistent with just and
        equitable principles of trade, or requires any act the omission
        of which constitutes conduct inconsistent with just and
        equitable principles of trade;
          (B) is subject to an order of the Commission denying,
        suspending, or revoking his registration pursuant to sections 9
        and 15 of this title, or expelling or suspending him from
        membership in a registered futures association or a registered
        entity, or barring or suspending him from being associated with
        a futures commission merchant;
          (C) whether prior or subsequent to becoming a member, by his
        conduct while associated with a member, was a cause of any
        suspension, expulsion, or order of the character described in
        clause (A) or (B) which is in effect with respect to such
        member, and in entering such a suspension, expulsion, or order,
        the Commission or any such registered entity or association
        shall have jurisdiction to determine whether or not any person
        was a cause thereof; or
          (D) has associated with him any person who is known, or in
        the exercise of reasonable care should be known, to him to be a
        person who would be ineligible for admission to or continuance
        in membership under clause (A), (B), or (C) of this paragraph;

        (4) the rules of the association provide that, except with the
      approval or at the direction of the Commission in cases in which
      the Commission finds it appropriate in the public interest so to
      approve or direct, no person shall become a member and no natural
      person shall become a person associated with a member, unless
      such person is qualified to become a member or a person
      associated with a member in conformity with specified and
      appropriate standards with respect to the training, experience,
      and such other qualifications of such person as the association
      finds necessary or desirable, and in the case of a member, the
      financial responsibility of such a member. For the purpose of
      defining such standards and the application thereof, such rules
      may - 
          (A) appropriately classify prospective members (taking into
        account relevant matters, including type or nature of business
        done) and persons proposed to be associated with members;
          (B) specify that all or any portion of such standard shall be
        applicable to any such class;
          (C) require persons in any such class to pass examinations
        prescribed in accordance with such rules;
          (D) provide that persons in any such class other than
        prospective members and partners, officers and supervisory
        employees (which latter term may be defined by such rules and
        as so defined shall include branch managers of members) of
        members, may be qualified solely on the basis of compliance
        with specified standards of training and such other
        qualifications as the association finds appropriate;
          (E) provide that applications to become a member or a person
        associated with a member shall set forth such facts as the
        association may prescribe as to the training, experience, and
        other qualifications (including, in the case of an applicant
        for membership, financial responsibility) of the applicant and
        that the association shall adopt procedures for verification of
        qualifications of the applicant, which may require the
        applicant to be fingerprinted and to submit, or cause to be
        submitted, such fingerprints to the Attorney General for
        identification and appropriate processing. Notwithstanding any
        other provision of law, such an association may receive from
        the Attorney General all the results of such identification and
        processing; and
          (F) require any class of persons associated with a member to
        be registered with the association in accordance with
        procedures specified by such rules (and any application or
        document supplemental thereto required by such rules of a
        person seeking to be registered with such association shall,
        for the purposes of sections 9 and 15 of this title, be deemed
        an application required to be filed under this section);

        (5) the rules of the association assure a fair representation
      of its members in the adoption of any rule of the association or
      amendment thereto, the selection of its officers and directors,
      and in all other phases of the administration of its affairs;
        (6) the rules of the association provide for the equitable
      allocation of dues among its members, to defray reasonable
      expenses of administration;
        (7) the rules of the association are designed to prevent
      fraudulent and manipulative acts and practices, to promote just
      and equitable principles of trade, in general, to protect the
      public interest, and to remove impediments to and perfect the
      mechanism of free and open futures trading;
        (8) the rules of the association provide that its members and
      persons associated with its members shall be appropriately
      disciplined, by expulsion, suspension, fine, censure, or being
      suspended or barred from being associated with all members, or
      any other fitting penalty, for any violation of its rules;
        (9) the rules of the association provide a fair and orderly
      procedure with respect to the disciplining of members and persons
      associated with members and the denial of membership to any
      person seeking membership therein or the barring of any person
      from being associated with a member. In any proceeding to
      determine whether any member or other person shall be
      disciplined, such rules shall require that specific charges be
      brought; that such member or person shall be notified of, and be
      given an opportunity to defend against, such charges; that a
      record shall be kept; and that the determination shall include - 
          (A) a statement setting forth any act or practice in which
        such member or other person may be found to have engaged, or
        which such member or other person may be found to have omitted;
          (B) a statement setting forth the specific rule or rules of
        the association of which any such act or practice, or omission
        to act, is deemed to be in violation;
          (C) a statement whether the acts or practices prohibited by
        such rule or rules, or the omission of any act required
        thereby, are deemed to constitute conduct inconsistent with
        just and equitable principles of trade; and
          (D) a statement setting forth the penalty imposed; (!1)

      In any proceeding to determine whether a person shall be denied
      membership or whether any person shall be barred from being
      associated with a member, such rules shall provide that the
      person shall be notified of, and be given an opportunity to be
      heard upon, the specific grounds for denial or bar which are
      under consideration; that a record shall be kept; and that the
      determination shall set forth the specific grounds upon which the
      denial or bar is based;
        (10) the rules of the association provide a fair, equitable,
      and expeditious procedure through arbitration or otherwise for
      the settlement of customers' claims and grievances against any
      member or employee thereof: Provided, That (A) the use of such
      procedure by a customer shall be voluntary, (B) the term
      "customer" as used in this paragraph shall not include another
      member of the association, and (C) in the case of a claim arising
      from a violation in the execution of an order on the floor of a
      registered entity, such procedure shall provide, to the extent
      appropriate - 
          (i) for payment of actual damages proximately caused by such
        violation. If an award of actual damages is made against a
        floor broker in connection with the execution of a customer
        order, and the futures commission merchant which selected the
        floor broker for the execution of the customer order is held to
        be responsible under section 2(a)(1) of this title for the
        floor broker's violation, such futures commission merchant may
        be required to satisfy such award; and
          (ii) where the violation is willful and intentional, for
        payment to the customer of punitive or exemplary damages, in
        addition to losses proximately caused by the violation, in an
        amount equal to no more than two times the amount of such
        losses. If punitive or exemplary damages are awarded against a
        floor broker in connection with the execution of a customer
        order, and the futures commission merchant which selected the
        floor broker for the execution of such order is held to be
        responsible under section 2(a)(1) of this title for the floor
        broker's violation, such futures commission merchant may be
        required to satisfy the award of punitive or exemplary damages
        if the floor broker fails to do so, except that such
        requirement shall apply to the futures commission merchant only
        if it willfully and intentionally selected the floor broker
        with the intent to assist or facilitate the floor broker's
        violation; and (!2)

        (11) such association provides for meaningful representation on
      the governing board of such association of a diversity of
      membership interests and provides that no less than 20 percent of
      the regular voting members of such board be comprised of
      qualified nonmembers of or persons who are not regulated by such
      association.(!3)

        (12)(A) (!4) such association provides on all major
      disciplinary committees for a diversity of membership sufficient
      to ensure fairness and to prevent special treatment or preference
      for any person in the conduct of disciplinary proceedings and the
      assessment of penalties.(!5)

        (13) A (!6) major disciplinary committee hearing a disciplinary
      matter shall include - 

          (A) qualified persons representing segments of the
        association membership other than that of the subject of the
        proceeding; and
          (B) where appropriate to carry out the purposes of this
        paragraph, qualified persons who are not members of the
        association.
    (c) Suspension of registration
      The Commission may, after notice and opportunity for hearing,
    suspend the registration of any futures association if it finds
    that the rules thereof do not conform to the requirements of the
    Commission, and any such suspension shall remain in effect until
    the Commission issues an order determining that such rules have
    been modified to conform with such requirements.
    (d) Fees and charges
      In addition to the fees and charges authorized by section 12a(1)
    of this title, each person registered under this chapter, who is
    not a member of a futures association registered pursuant to this
    section, shall pay to the Commission such reasonable fees and
    charges as may be necessary to defray the costs of additional
    regulatory duties required to be performed by the Commission
    because such person is not a member of a registered futures
    association. The Commission shall establish such additional fees
    and charges by rules and regulations.
    (e) Registered persons not members of registered associations
      Any person registered under this chapter, who is not a member of
    a futures association registered pursuant to this section, in
    addition to the other requirements and obligations of this chapter
    and the regulations thereunder shall be subject to such other rules
    and regulations as the Commission may find necessary to protect the
    public interest and promote just and equitable principles of trade.
    (f) Denial of registration
      Upon filing of an application for registration pursuant to
    subsection (a) of this section, the Commission may by order grant
    such registration if the requirements of this section are
    satisfied. If, after appropriate notice and opportunity for
    hearing, it appears to the Commission that any requirement of this
    section is not satisfied, the Commission shall by order deny such
    registration.
    (g) Withdrawal from registration; notice of withdrawal
      A registered futures association may, upon such reasonable notice
    as the Commission may deem necessary in the public interest,
    withdraw from registration by filing with the Commission a written
    notice of withdrawal in such form as the Commission may by rules
    and regulations prescribe.
    (h) Commission review of disciplinary actions taken by registered
      futures associations
      (1) If any registered futures association takes any final
    disciplinary action against a member of the association or a person
    associated with a member, denies admission to any person seeking
    membership therein, or bars any person from being associated with a
    member, the association promptly shall give notice thereof to such
    member or person and file notice thereof with the Commission. The
    notice shall be in such form and contain such information as the
    Commission, by rule or regulation, may prescribe as necessary or
    appropriate to carry out the purposes of this chapter.
      (2) Any action with respect to which a registered futures
    association is required by paragraph (1) to file notice shall be
    subject to review by the Commission on its motion, or on
    application by any person aggrieved by the action. Such application
    shall be filed within 30 days after the date such notice is filed
    with the Commission and received by the aggrieved person, or within
    such longer period as the Commission may determine.
      (3)(A) Application to the Commission for review, or the
    institution of review by the Commission on its own motion, shall
    not operate as a stay of such action unless the Commission
    otherwise orders, summarily or after notice and opportunity for
    hearing on the question of a stay (which hearing may consist solely
    of the submission of affidavits or presentation of oral arguments).
      (B) The Commission shall establish procedures for expedited
    consideration and determination of the question of a stay.
    (i) Notice; hearing; findings; cancellation, reduction, or
      remission of penalties; review by court of appeals
      (1) In a proceeding to review a final disciplinary action taken
    by a registered futures association against a member thereof or a
    person associated with a member, after appropriate notice and
    opportunity for a hearing (which hearing may consist solely of
    consideration of the record before the association and opportunity
    for the presentation of supporting reasons to affirm, modify, or
    set aside the sanction imposed by the association) - 
        (A) if the Commission finds that - 
          (i) the member or person associated with a member has engaged
        in the acts or practices, or has omitted the acts, that the
        association has found the member or person to have engaged in
        or omitted;
          (ii) the acts or practices, or omissions to act, are in
        violation of the rules of the association specified in the
        determination of the association; and
          (iii) such rules are, and were applied in a manner,
        consistent with the purposes of this chapter,

      the Commission, by order, shall so declare and, as appropriate,
      affirm the sanction imposed by the association, modify the
      sanction in accordance with paragraph (2), or remand the case to
      the association for further proceedings; or
        (B) if the Commission does not make any such finding, the
      Commission, by order, shall set aside the sanction imposed by the
      association and, if appropriate, remand the case to the
      association for further proceedings.

      (2) If, after a proceeding under paragraph (1), the Commission
    finds that any penalty imposed on a member or person associated
    with a member is excessive or oppressive, having due regard for the
    public interest, the Commission, by order, shall cancel, reduce, or
    require the remission of the penalty.
      (3) In a proceeding to review the denial of membership in a
    registered futures association or the barring of any person from
    being associated with a member, after appropriate notice and
    opportunity for a hearing (which hearing may consist solely of
    consideration of the record before the association and opportunity
    for the presentation of supporting reasons to affirm, modify, or
    set aside the action of the association) - 
        (A) if the Commission finds that - 
          (i) the specific grounds on which the denial or bar is based
        exist in fact;
          (ii) the denial or bar is in accordance with the rules of the
        association; and
          (iii) such rules are, and were applied in a manner,
        consistent with the purposes of this chapter,

      the Commission, by order, shall so declare and, as appropriate,
      affirm or modify the action of the association, or remand the
      case to the association for further proceedings; or
        (B) if the Commission does not make any such finding, the
      Commission, by order, shall set aside the action of the
      association and require the association to admit the applicant to
      membership or permit the person to be associated with a member,
      or, as appropriate, remand the case to the association for
      further proceedings.

      (4) Any person aggrieved by a final order of the Commission
    entered under this subsection may file a petition for review with a
    United States court of appeals in the same manner as provided in
    sections 9 and 15 of this title.
    (j) Changes or additions to association rules
      Every registered futures association shall file with the
    Commission in accordance with such rules and regulations as the
    Commission may prescribe as necessary or appropriate in the public
    interest, copies of any changes in or additions to the rules of the
    association, and such other information and documents as the
    Commission may require to keep current or to supplement the
    registration statement and documents filed pursuant to subsection
    (a) of this section. A registered futures association shall submit
    to the Commission any change in or addition to its rules and may
    make such rules effective ten days after receipt of such submission
    by the Commission unless, within the ten-day period, the registered
    futures association requests review and approval thereof by the
    Commission or the Commission notifies such registered futures
    association in writing of its determination to review such rules
    for approval. The Commission shall approve such rules if such rules
    are determined by the Commission to be consistent with the
    requirements of this section and not otherwise in violation of this
    chapter or the regulations issued pursuant to this chapter, and the
    Commission shall disapprove, after appropriate notice and
    opportunity for hearing, any such rule which the Commission
    determines at any time to be inconsistent with the requirements of
    this section or in violation of this chapter or the regulations
    issued pursuant to this chapter. If the Commission does not approve
    or institute disapproval proceedings with respect to any rule
    within one hundred and eighty days after receipt or within such
    longer period of time as the registered futures association may
    agree to, or if the Commission does not conclude a disapproval
    proceeding with respect to any rule within one year after receipt
    or within such longer period as the registered futures association
    may agree to, such rule may be made effective by the registered
    futures association until such time as the Commission disapproves
    such rule in accordance with this subsection.
    (k) Abrogation of association rules; requests to associations by
      Commission to alter or supplement rules
      (1) The Commission is authorized by order to abrogate any rule of
    a registered futures association, if after appropriate notice and
    opportunity for hearing, it appears to the Commission that such
    abrogation is necessary or appropriate to assure fair dealing by
    the members of such association, to assure a fair representation of
    its members in the administration of its affairs or effectuate the
    purposes of this section.
      (2) The Commission may in writing request any registered futures
    association to adopt any specified alteration or supplement to its
    rules with respect to any of the matters hereinafter enumerated. If
    such association fails to adopt such alteration or supplement
    within a reasonable time, the Commission is authorized by order to
    alter or supplement the rules of such association in the manner
    theretofore requested, or with such modifications of such
    alteration or supplement as it deems necessary if, after
    appropriate notice and opportunity for hearing, it appears to the
    Commission that such alteration or supplement is necessary or
    appropriate in the public interest or to effectuate the purposes of
    this section, with respect to - 
        (A) the basis for, and procedure in connection with, the denial
      of membership or the barring from being associated with a member
      or the disciplining of members or persons associated with
      members, or the qualifications required for members or natural
      persons associated with members or any class thereof;
        (B) the method for adoption of any change in or addition to the
      rules of the association;
        (C) the method of choosing officers and directors.
    (l) Suspension and revocation of registration; expulsion of
      members; removal of association officers or directors
      The Commission is authorized, if such action appears to it to be
    necessary or appropriate in the public interest or to carry out the
    purposes of this section - 
        (1) after appropriate notice and opportunity for hearing, by
      order to suspend for a period not exceeding twelve months or to
      revoke the registration of a registered futures association, if
      the Commission finds that such association has violated any
      provisions of this chapter or any rule or regulation thereunder,
      or has failed to enforce compliance with its own rules, or has
      engaged in any other activity tending to defeat the purposes of
      this chapter;
        (2) after appropriate notice and opportunity for hearing, by
      order to suspend for a period not exceeding twelve months or to
      expel from a registered futures association any member thereof,
      or to suspend for a period not exceeding twelve months or to bar
      any person from being associated with a member thereof, if the
      Commission finds that such member or person - 
          (A) has violated any provision of this chapter or any rule or
        regulation thereunder, or has effected any transaction for any
        other person who, he had reason to believe, was violating with
        respect to such transaction any provision of this chapter or
        any rule or regulation thereunder; or
          (B) has willfully violated any provision of this chapter, or
        of any rule, regulation, or order thereunder, or has effected
        any transaction for any other person who, he had reason to
        believe, was willfully violating with respect to such
        transaction any provision of this chapter or rule, regulation,
        or order; and

        (3) after appropriate notice and opportunity for hearing, by
      order to remove from office any officer or director of a
      registered futures association who, the Commission finds, has
      willfully failed to enforce the rules of the association, or has
      willfully abused his authority.
    (m) Rules requiring membership in associations
      Notwithstanding any other provision of law, the Commission may
    approve rules of futures associations that, directly or indirectly,
    require persons eligible for membership in such associations to
    become members of at least one such association, upon a
    determination by the Commission that such rules are necessary or
    appropriate to achieve the purposes and objectives of this chapter.
    (n) Reports to Congress
      The Commission shall include in its annual reports to Congress
    information concerning any futures associations registered pursuant
    to this section and the effectiveness of such associations in
    regulating the practices of the members.
    (o) Delegation to futures associations of registrative functions;
      discretionary review by Commission; judicial appeal
      (1) The Commission may require any futures association registered
    pursuant to this section to perform any portion of the registration
    functions under this chapter with respect to each member of the
    association other than a registered entity and with respect to each
    associated person of such member, in accordance with rules,
    notwithstanding any other provision of law, adopted by such futures
    association and submitted to the Commission pursuant to subsection
    (j) of this section, and subject to the provisions of this chapter
    applicable to registrations granted by the Commission.
      (2) In performing any Commission registration function authorized
    by the Commission under section 12a(10) of this title, this
    section, or any other applicable provisions of this chapter, a
    futures association may issue orders (A) to refuse to register any
    person, (B) to register conditionally any person, (C) to suspend
    the registration of any person, (D) to place restrictions on the
    registration of any person, or (E) to revoke the registration of
    any person. If such an order is the final decision of the futures
    association, any person against whom the order has been issued may
    petition the Commission to review the decision. The Commission may
    on its own initiative or upon petition decline review or grant
    review and affirm, set aside, or modify such an order of the
    futures association; and the findings of the futures association as
    to the facts, if supported by the weight of the evidence, shall be
    conclusive. Unless the Commission grants review under this section
    of an order concerning registration issued by a futures
    association, the order of the futures association shall be
    considered to be an order issued by the Commission.
      (3) Nothing in this section shall affect the Commission's
    authority to review the granting of a registration application by a
    registered futures association that is performing any Commission
    registration function authorized by the Commission under section
    12a(10) of this title, this section, or any other applicable
    provision of this chapter.
      (4) If a person against whom a futures association has issued a
    registration order under this subsection petitions the Commission
    to review that order and the Commission declines to take review,
    such person may file a petition for review with a United States
    court of appeals, in accordance with sections 9 and 15 of this
    title.
    (p) Establishment of rules for futures associations; approval by
      Commission
      Notwithstanding any other provision of this section, each futures
    association registered under this section on January 11, 1983,
    shall adopt and submit for Commission approval not later than
    ninety days after such date, and each futures association that
    applies for registration after such date shall adopt and include
    with its application for registration, rules of the association
    that require the association to - 
        (1) establish training standards and proficiency testing for
      persons involved in the solicitation of transactions subject to
      the provisions of this chapter, supervisors of such persons, and
      all persons for which it has registration responsibilities, and a
      program to audit and enforce compliance with such standards;
        (2) establish minimum capital, segregation, and other financial
      requirements applicable to its members for which such
      requirements are imposed by the Commission and implement a
      program to audit and enforce compliance with such requirements,
      except that such requirements may not be less stringent than
      those imposed on such firms by this chapter or by Commission
      regulation;
        (3) establish minimum standards governing the sales practices
      of its members and persons associated therewith for transactions
      subject to the provisions of this chapter; and
        (4) establish special supervisory guidelines to protect the
      public interest relating to the solicitation by telephone of new
      futures or options accounts and make such guidelines applicable
      to those members determined to require such guidelines in
      accordance with standards established by the Commission
      consistent with this chapter. Such guidelines may include a
      requirement that, with respect to a customer with no previous
      futures or commodity options trading experience, the member may
      not enter an order for the account of such customer for a period
      of three days following opening of the account and receipt of a
      signed acknowledgment by the customer of receipt of a risk
      disclosure statement.
    (q) (!7) Major disciplinary rule violations

      (1) The Commission shall issue regulations requiring each
    registered futures association to establish and make available to
    the public a schedule of major violations of any rule within the
    disciplinary jurisdiction of such registered futures association.
      (2) The regulations issued by the Commission pursuant to this
    subsection shall prohibit, for a period of time to be determined by
    the Commission, any member of a registered futures association who
    is found to have committed any major violation from service on the
    governing board of any registered futures association or registered
    entity, or on any disciplinary committee thereof.
    (q) (!7) Program for implementation of rules
      Each futures association registered under this section shall
    develop a comprehensive program that fully implements the rules
    approved by the Commission under this section as soon as
    practicable but not later than September 30, 1985, in the case of
    any futures association registered on January 11, 1983, and not
    later than two and one-half years after the date of registration in
    the case of any other futures association registered under this
    section.
    (r) Rules to avoid duplicative regulation of dual registrants
      Consistent with this chapter, each futures association registered
    under this section shall issue such rules as are necessary to avoid
    duplicative or conflicting rules applicable to any futures
    commission merchant registered with the Commission pursuant to
    section 6f(a) of this title (except paragraph (2) thereof), that is
    also registered with the Securities and Exchange Commission
    pursuant to section 78o(b) of title 15 (except paragraph (11)
    thereof), with respect to the application of - 
        (1) rules of such futures association of the type specified in
      section 6d(3) of this title involving security futures products;
      and
        (2) similar rules of national securities associations
      registered pursuant to section 78o-3(a) of title 15 involving
      security futures products.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 17, as added Pub. L. 93-463, title
    III, Sec. 301, Oct. 23, 1974, 88 Stat. 1406; amended Pub. L. 95-
    405, Sec. 22, Sept. 30, 1978, 92 Stat. 876; Pub. L. 97-444, title
    II, Secs. 217(b), 233, Jan. 11, 1983, 96 Stat. 2307, 2320; Pub. L.
    99-641, title I, Secs. 107, 108, 110(6), (7), Nov. 10, 1986, 100
    Stat. 3558, 3559, 3561; Pub. L. 102-546, title II, Secs. 204(a),
    206(b), 209(b)(8), 222(c), 228, title IV, Sec. 402(12), Oct. 28,
    1992, 106 Stat. 3600, 3602, 3607, 3616, 3619, 3625; Pub. L. 106-
    554, Sec. 1(a)(5) [title I, Sec. 123(a)(24), title II, Sec.
    251(g)], Dec. 21, 2000, 114 Stat. 2763, 2763A-410, 2763A-444.)

-MISC1-
                                AMENDMENTS                            
      2000 - Subsecs. (b)(2), (3), (10), (o)(1), (q)(2). Pub. L. 106-
    554, Sec. 1(a)(5) [title I, Sec. 123(a)(24)], substituted
    "registered entity" for "contract market" wherever appearing.
      Subsec. (r). Pub. L. 106-554, Sec. 1(a)(5) [title II, Sec.
    251(g)], added subsec. (r).
      1992 - Subsec. (a)(1), (2). Pub. L. 102-546, Sec. 402(12)(A),
    realigned margins.
      Subsec. (b)(3). Pub. L. 102-546, Secs. 206(b)(1)(A), (B),
    209(b)(8)(A)(i), struck out "or" at end of subpar. (A), in subpar.
    (B) made technical amendment to reference to sections 9 and 15 of
    this title to reflect change in reference to corresponding section
    of original act and struck out "or" at end, and in subpar. (D)
    substituted a semicolon for period at end.
      Subsec. (b)(4). Pub. L. 102-546, Secs. 206(b)(1)(B), (C),
    209(b)(8)(A)(ii), substituted a semicolon for period at end of
    subpars. (A) to (D), in subpar. (E) substituted "; and" for period
    at end, and in subpar. (F) made technical amendment to reference to
    sections 9 and 15 of this title to reflect change in reference to
    corresponding section of original act and substituted a semicolon
    for period at end.
      Subsec. (b)(5) to (9). Pub. L. 102-546, Sec. 206(b)(1)(B), (C),
    substituted a semicolon for period at end of pars. (5) to (9) and
    subpars. (A), (B), and (D) of par. (9) and in par. (9)(C)
    substituted "; and" for period at end.
      Subsec. (b)(10). Pub. L. 102-546, Secs. 206(b)(1)(C), 222(c),
    substituted "(A)" for "(i)" and "voluntary, (B)" for "voluntary and
    (ii)", inserted ", and" and subpar. (C) after "association", and
    substituted "; and" for period at end.
      Subsec. (b)(11) to (13). Pub. L. 102-546, Sec. 206(b)(1)(D),
    added pars. (11) to (13).
      Subsec. (i)(4). Pub. L. 102-546, Sec. 228, which directed that
    "(other than a registered futures association)." be struck out, was
    executed by striking "(other than a registered futures
    association)" after "Any person" to reflect the probable intent of
    Congress.
      Pub. L. 102-546, Sec. 209(b)(8)(B), made technical amendment to
    reference to sections 9 and 15 of this title to reflect change in
    reference to corresponding section of original act.
      Subsec. (l)(2)(B). Pub. L. 102-546, Sec. 402(12)(B), made
    technical amendment to reference to this chapter appearing after
    "violated any provision of" to reflect change in reference to
    corresponding provision of original act and substituted "; and" for
    period at end.
      Subsec. (o)(4). Pub. L. 102-546, Sec. 209(b)(8)(C), made
    technical amendment to reference to sections 9 and 15 of this title
    to reflect change in reference to corresponding section of original
    act.
      Subsec. (p)(4). Pub. L. 102-546, Sec. 204(a), added par. (4).
      Subsec. (q). Pub. L. 102-546, Sec. 206(b)(2), added subsec. (q)
    relating to major disciplinary rules violations.
      1986 - Subsec. (b)(2). Pub. L. 99-641, Sec. 110(6), substituted
    "within" for "with in" before "the meaning".
      Subsec. (h). Pub. L. 99-641, Sec. 107, amended subsec. (h)
    generally. Prior to amendment, subsec. (h) read as follows: "If any
    registered futures association takes any disciplinary action
    against any member thereof or any person associated with such a
    member or denies admission to any person seeking membership
    therein, or bars any person from being associated with a member,
    such action shall be subject to review by the Commission, on its
    own motion, or upon application by any person aggrieved thereby
    filed within thirty days after such action has been taken or within
    such longer period as the Commission may determine. Application to
    the Commission for review, or the institution of review by the
    Commission on its own motion, shall operate as a stay of such
    action until an order is issued upon such review pursuant to
    subsection (i) of this section unless the Commission otherwise
    orders, after notice and opportunity for hearing on the question of
    a stay (which hearing may consist solely of affidavits and oral
    arguments)."
      Subsec. (i). Pub. L. 99-641, Sec. 107, amended subsec. (i)
    generally. Prior to amendment, subsec. (i) read as follows:
      "(1) In a proceeding to review disciplinary action taken by a
    registered futures association against a member thereof or a person
    associated with a member, if the Commission, after appropriate
    notice and opportunity for hearing, upon consideration of the
    record before the association and such other evidence as it may
    deem relevant - 
        "(A) finds that such member or person has engaged in such acts
      or practices, or has omitted such act, as the association has
      found him to have engaged in or omitted, and
        "(B) determines that such acts or practices, or omission to
      act, are in violation of such rules of the association as have
      been designated in the determination of the association, the
      Commission shall by order dismiss the proceeding, unless it
      appears to the Commission that such action should be modified in
      accordance with paragraph (2) of this subsection. The Commission
      shall likewise determine whether the acts or practices
      prohibited, or the omission of any act required, by any such rule
      constitute conduct inconsistent with just and equitable
      principles of trade, and shall so declare. If it appears to the
      Commission that the evidence does not warrant the finding
      required in clause (A), or if the Commission determines that such
      acts or practices as are found to have been engaged in are not
      prohibited by the designated rule or rules of the association, or
      that such act as is found to have been omitted is not required by
      such designated rule or rules, the Commission shall by order set
      aside the action of the association.
      "(2) If, after appropriate notice and opportunity for hearing,
    the Commission finds that any penalty imposed upon a member or
    person associated with a member is excessive or oppressive, having
    due regard to the public interest, the Commission shall by order
    cancel, reduce, or require the remission of such penalty.
      "(3) In any proceeding to review the denial of membership in a
    registered futures association or the barring of any person from
    being associated with a member, if the Commission, after
    appropriate notice and hearing, and upon consideration of the
    record before the association and such other evidence as it may
    deem relevant, determines that the specific grounds on which such
    denial or bar is based exist in fact and are valid under this
    section, the Commission shall by order dismiss the proceeding;
    otherwise, the Commission shall by order set aside the action of
    the association and require it to admit the applicant to membership
    therein, or to permit such person to be associated with a member."
      Subsec. (j). Pub. L. 99-641, Sec. 108, struck out sentence which
    read as follows: "The Commission shall approve such rules within
    thirty days of their receipt if Commission approval is requested
    under this subsection or within thirty days after the Commission
    determines to review for approval any other rules unless the
    Commission notifies the registered futures association of its
    inability to complete such approval or review within such period of
    time."
      Subsec. (k)(1). Pub. L. 99-641, Sec. 110(7), substituted
    "section" for "title".
      1983 - Subsec. (b)(4)(E). Pub. L. 97-444, Sec. 233(1), inserted
    ", which may require the applicant to be fingerprinted and to
    submit, or cause to be submitted, such fingerprints to the Attorney
    General for identification and appropriate processing.
    Notwithstanding any other provision of law, such an association may
    receive from the Attorney General all the results of such
    identification and processing" after "adopt procedures for
    verification of qualifications of the applicant".
      Subsec. (b)(10). Pub. L. 97-444, Sec. 217(b), required
    association rules to provide for "expeditious" procedure,
    redesignated cl. (iv) as (ii) and substituted " 'customer' as used
    in this paragraph shall not include another member of the
    association" for " 'customer' as used in this subsection shall not
    include a futures commission merchant or a floor broker", and
    struck out clauses "(ii) the procedure shall not be applicable to
    any claim in excess of $15,000, (iii) the procedure shall not
    result in any compulsory payment except as agreed upon between the
    parties,".
      Subsec. (d). Pub. L. 97-444, Sec. 233(2), substituted "section
    12a(1) of this title" for "section 12a(4) of this title".
      Subsec. (h). Pub. L. 97-444, Sec. 233(3), substituted "subsection
    (i) of this section" for "subsection (k) of this section".
      Subsec. (j). Pub. L. 97-444, Sec. 233(4), substituted "A
    registered futures association shall submit to the Commission any
    change in or addition to its rules and may make such rules
    effective ten days after receipt of such submission by the
    Commission unless, within the ten-day period, the registered
    futures association requests review and approval thereof by the
    Commission or the Commission notifies such registered futures
    association in writing of its determination to review such rules
    for approval. The Commission shall approve such rules within thirty
    days of their receipt if Commission approval is requested under
    this subsection or within thirty days after the Commission
    determines to review for approval any other rules unless the
    Commission notifies the registered futures association of its
    inability to complete such approval or review within such period of
    time. The Commission shall approve such rules if such rules are
    determined by the Commission to be consistent with the requirements
    of this section and not otherwise in violation of this chapter or
    the regulations issued pursuant to this chapter, and the Commission
    shall disapprove, after appropriate notice and opportunity for
    hearing, any such rule which the Commission determines at any time
    to be inconsistent with the requirements of this section or in
    violation of this chapter or the regulations issued pursuant to
    this chapter. If the Commission does not approve or institute
    disapproval proceedings with respect to any rule within one hundred
    and eighty days after receipt or within such longer period of time
    as the registered futures association may agree to, or if the
    Commission does not conclude a disapproval proceeding with respect
    to any rule within one year after receipt or within such longer
    period as the registered futures association may agree to, such
    rule may be made effective by the registered futures association
    until such time as the Commission disapproves such rule in
    accordance with this subsection" for "Any change in or addition to
    the rules of a registered futures association shall be submitted to
    the Commission for approval and shall take effect upon the
    thirtieth day after such approval by the Commission, or upon such
    earlier date as the Commission may determine, unless the Commission
    shall enter an order disapproving such change or addition; and the
    Commission shall enter such an order unless such change or addition
    appears to the Commission to be consistent with the requirements of
    this section and the provisions of this chapter".
      Subsecs. (o) to (q). Pub. L. 97-444, Sec. 233(5), added subsecs.
    (o), (p), and (q).
      1978 - Subsec. (b)(3)(B). Pub. L. 95-405, Sec. 22(1), struck out
    "(7 U.S.C. 9)" after "sections 9 and 15 of this title".
      Subsec. (b)(10). Pub. L. 95-405, Sec. 22(2), substituted
    "$15,000" for "$5,000".
      Subsec. (l)(1), (2)(A). Pub. L. 95-405, Sec. 22(3), substituted
    "chapter" for "section" wherever appearing.
      Subsecs. (m), (n). Pub. L. 95-405, Sec. 22(4), added subsec. (m)
    and redesignated former subsec. (m) as (n).

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                     EFFECTIVE DATE OF 1978 AMENDMENT                 
      Amendment by Pub. L. 95-405 effective Oct. 1, 1978, see section
    28 of Pub. L. 95-405, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      For effective date of section, see section 418 of Pub. L. 93-463,
    set out as an Effective Date of 1974 Amendment note under section 2
    of this title.

                              IMPLEMENTATION                          
      Section 204(b) of Pub. L. 102-546 provided that: "The guidelines
    required under section 17(p)(4) of the Commodity Exchange Act [7
    U.S.C. 21(p)(4)] (as added by subsection (a) of this section) shall
    be submitted by a futures association registered with the Commodity
    Futures Trading Commission on the date of enactment of this Act
    [Oct. 28, 1992] to the Commission for the approval of the
    Commission not later than one hundred and eighty days after the
    date of enactment of this Act."

                   STUDY ON COMPUTERIZED FUTURES TRADING               
      Pub. L. 102-546, title II, Sec. 220(b), (c), Oct. 28, 1992, 106
    Stat. 3614, provided that:
      "(b) Study. - The Commodity Futures Trading Commission shall
    conduct a study to assess - 
        "(1) the progress made under initiatives to conduct trading in
      futures and options subject to the jurisdiction of the Commission
      under the Commodity Exchange Act [7 U.S.C. 1 et seq.] through
      systems of computers or by other electronic means; and
        "(2) whether the experience with such systems of trading
      indicates that they may be useful or effective to enhance access
      to the futures and options markets by potential market
      participants, improve the ability of the Commission to audit the
      activities of the futures and options markets, reduce the
      opportunity for trading abuses, and otherwise be in the public
      interest or raise other related issues.
      "(c) Report. - Not later than two years after the date of
    enactment of this Act [Oct. 28, 1992], the Commission shall submit
    to the Committee on Agriculture of the House of Representatives and
    the Committee on Agriculture, Nutrition, and Forestry of the Senate
    a report containing the results of the study conducted under
    subsection (a), together with any appropriate recommendations."

-FOOTNOTE-               

    (!1) So in original. The semicolon probably should be a period.

               

    (!2) So in original. The word "and" probably should not appear.

               

    (!3) So in original. The period probably should be a semicolon.

               

    (!4) So in original. No subpar. (B) has been enacted.

    (!5) So in original. The period probably should be "; and".

    (!6) So in original. Probably should not be capitalized.

    (!7) Two subsecs. (q) have been enacted.

-End-

-CITE-
    7 USC Sec. 22                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 22. Research and information programs; reports to Congress

-STATUTE-
      (a) The Commission shall establish and maintain, as part of its
    ongoing operations, research and information programs to (1)
    determine the feasibility of trading by computer, and the expanded
    use of modern information system technology, electronic data
    processing, and modern communication systems by commodity
    exchanges, boards of trade, and by the Commission itself for
    purposes of improving, strengthening, facilitating, or regulating
    futures trading operations; (2) assist in the development of
    educational and other informational materials regarding futures
    trading for dissemination and use among producers, market users,
    and the general public; and (3) carry out the general purposes of
    this chapter.
      (b) The Commission shall include in its annual reports to
    Congress plans and findings with respect to implementing this
    section.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 18, as added Pub. L. 93-463, title
    IV, Sec. 416, Oct. 23, 1974, 88 Stat. 1415.)

-MISC1-
                              EFFECTIVE DATE                          
      For effective date of section, see section 418 of Pub. L. 93-463,
    set out as an Effective Date of 1974 Amendment note under section 2
    of this title.

-End-

-CITE-
    7 USC Sec. 23                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 23. Standardized contracts for certain commodities

-STATUTE-
    (a) Margin accounts or contracts and leverage accounts or contracts
      prohibited except as authorized
      Except as authorized under subsection (b) of this section, no
    person shall offer to enter into, enter into, or confirm the
    execution of, any transaction for the delivery of any commodity
    under a standardized contract commonly known to the trade as a
    margin account, margin contract, leverage account, or leverage
    contract, or under any contract, account, arrangement, scheme, or
    device that the Commission determines serves the same function or
    functions as such a standardized contract, or is marketed or
    managed in substantially the same manner as such a standardized
    contract.
    (b) Permission to enter into contracts for delivery of silver or
      gold bullion, bulk silver or gold coins, or platinum; rules and
      regulations
      (1) Subject to paragraph (2), no person shall offer to enter
    into, enter into, or confirm the execution of, any transaction for
    the delivery of silver bullion, gold bullion, bulk silver coins,
    bulk gold coins, or platinum under a standardized contract
    described in subsection (a) of this section, contrary to the terms
    of any rule, regulation, or order that the Commission shall
    prescribe, which may include terms designed to ensure the financial
    solvency of the transaction or prevent manipulation or fraud. Such
    rule, regulation, or order may be made only after notice and
    opportunity for hearing. The Commission may set different terms and
    conditions for transactions involving different commodities.
      (2) No person may engage in any activity described in paragraph
    (1) who is not permitted to engage in such activity, by the rules,
    regulations, and orders of the Commission in effect on November 10,
    1986, until the Commission permits such person to engage in such
    activity in accordance with regulations issued in accordance with
    subsection (c)(2) of this section.
    (c) Survey of persons interested in engaging in transactions of
      silver and gold, etc.; assistance of futures association;
      regulations
      (1)(A) Not later than 2 years after November 10, 1986, the
    Commission shall - 
        (i) with the assistance of a futures association registered
      under this chapter, conduct a survey concerning the persons
      interested in engaging in the business of offering to enter into,
      entering into, or confirming the execution of, the transactions
      described in subsection (b)(1) of this section; and
        (ii) transmit a report of the results of the survey to the
      Committee on Agriculture of the House of Representatives and the
      Committee on Agriculture, Nutrition, and Forestry of the Senate.

      (B) Notwithstanding any other provision of law, for purposes of
    completing such report the Commission may direct, by rule,
    regulation, or order, a futures association registered under this
    chapter to render such assistance as the Commission shall specify.
      (C) Such report shall include the findings and any
    recommendations of the Commission concerning - 
        (i) whether such transactions serve an economic purpose;
        (ii) the most efficient manner, consistent with the public
      interest, to permit additional persons to engage in the business
      of offering to enter into, entering into, and confirming the
      execution of such transactions; and
        (iii) the appropriate regulatory scheme to govern such
      transactions to ensure the financial solvency of such
      transactions and to prevent manipulation or fraud.

      (2) The report shall also include Commission regulations
    governing such transactions. The regulations shall provide for
    permitting additional persons to engage in such transactions. The
    regulations shall become effective on the expiration of 90 calendar
    days on which either House of Congress is in session after the date
    of the transmittal of the report to Congress. The regulations - 
        (A) may authorize or require, notwithstanding any other
      provision of law, a futures association registered under this
      chapter to perform such responsibilities in connection with such
      transactions as the Commission may specify; and
        (B) may require that permission for additional persons to
      engage in such business be given on a gradual basis, so as not to
      place an undue burden on the resources of the Commission.
    (d) Savings provision
      This section shall not affect any rights or obligations arising
    out of any transaction subject to this section, as in effect before
    November 10, 1986, that was entered into, or the execution of which
    was confirmed, before November 10, 1986.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 19, as added Pub. L. 95-405, Sec.
    23, Sept. 30, 1978, 92 Stat. 876; amended Pub. L. 97-444, title II,
    Sec. 234, Jan. 11, 1983, 96 Stat. 2322; Pub. L. 99-641, title I,
    Sec. 109, Nov. 10, 1986, 100 Stat. 3560.)

-MISC1-
                             PRIOR PROVISIONS                         
      Provisions similar to those appearing in subsec. (b) were
    formerly contained in section 15a of this title.

                                AMENDMENTS                            
      1986 - Subsec. (a). Pub. L. 99-641 amended subsec. (a) generally.
    Prior to amendment, subsec. (a) read as follows: "No person shall
    offer to enter into, enter into, or confirm the execution of, any
    transaction for the delivery of any commodity specifically set
    forth in section 2 of this title prior to October 23, 1974, under a
    standardized contract commonly known to the trade as a margin
    account, margin contract, leverage account, or leverage contract,
    or under any contract, account, arrangement, scheme, or device that
    the Commission determines serves the same function or functions as
    such a standardized contract, or is marketed or managed in
    substantially the same manner as such a standardized contract."
      Subsec. (b). Pub. L. 99-641 amended subsec. (b) generally. Prior
    to amendment, subsec. (b) read as follows: "No person shall offer
    to enter into, enter into, or confirm the execution of any
    transaction for the delivery of silver bullion, gold bullion, or
    bulk silver coins or bulk gold coins, under a standardized contract
    described in subsection (a) of this section, contrary to any rule,
    regulation, or order of the Commission designed to ensure the
    financial solvency of the transaction or prevent manipulation or
    fraud: Provided, That such rule, regulation, or order may be made
    only after notice and opportunity for hearing."
      Subsec. (c). Pub. L. 99-641 amended subsec. (c) generally. Prior
    to amendment, subsec. (c) read as follows: "The Commission shall
    regulate any transactions under a standardized contract described
    in subsection (a) of this section involving commodities described
    in subsection (b) of this section or any other commodities (except
    those commodities described in subsection (a) of this section)
    under such terms and conditions as the Commission shall prescribe
    by rule, regulation, or order made only after notice and
    opportunity for a hearing. The Commission may set different terms
    and conditions for such transactions involving different
    commodities. Notwithstanding any other provision of this section,
    the Commission may prohibit any transaction for the delivery of any
    commodity under a standardized contract described in subsection (a)
    of this section that is not permitted by the rules, regulations and
    orders of the Commission in effect on December 9, 1982, if the
    Commission determines that any such transactions would be contrary
    to the public interest."
      Subsec. (d). Pub. L. 99-641, in amending section generally, added
    subsec. (d).
      1983 - Subsec. (c). Pub. L. 97-444, Sec. 234(1), substituted
    "shall regulate" for "may prohibit or regulate" and authorized
    Commission prohibition of transactions for delivery of commodities
    under a standardized contract that was not permitted by the rules,
    regulations and orders of the Commission in effect on Dec. 9, 1982,
    where transactions are determined to be contrary to the public
    interest.
      Subsec. (d). Pub. L. 97-444, Sec. 234(2), struck out subsec. (d)
    which provided for regulation of transactions in accordance with
    applicable provisions of this chapter where Commission determined
    the transactions under subsecs. (b) and (c) of this section were
    contracts for future delivery within the meaning of this chapter.

                     EFFECTIVE DATE OF 1983 AMENDMENT                 
      Amendment by Pub. L. 97-444 effective Jan. 11, 1983, see section
    239 of Pub. L. 97-444, set out as a note under section 2 of this
    title.

                              EFFECTIVE DATE                          
      Section effective Oct. 1, 1978, see section 28 of Pub. L. 95-405,
    set out as an Effective Date of 1978 Amendment note under section 2
    of this title.

-End-

-CITE-
    7 USC Sec. 24                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 24. Regulations respecting commodity broker debtors;
      definitions

-STATUTE-
      (a) Notwithstanding title 11, the Commission may provide, with
    respect to a commodity broker that is a debtor under chapter 7 of
    title 11, by rule or regulation - 
        (1) that certain cash, securities, other property, or commodity
      contracts are to be included in or excluded from customer
      property or member property;
        (2) that certain cash, securities, other property, or commodity
      contracts are to be specifically identifiable to a particular
      customer in a specific capacity;
        (3) the method by which the business of such commodity broker
      is to be conducted or liquidated after the date of the filing of
      the petition under such chapter, including the payment and
      allocation of margin with respect to commodity contracts not
      specifically identifiable to a particular customer pending their
      orderly liquidation;
        (4) any persons to which customer property and commodity
      contracts may be transferred under section 766 of title 11; and
        (5) how the net equity of a customer is to be determined.

      (b) As used in this section, the terms "commodity broker",
    "commodity contract", "customer", "customer property", "member
    property", "net equity", and "security" have the meanings assigned
    such terms for the purposes of subchapter IV of chapter 7 of title
    11.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 20, formerly Sec. 19, as added Pub.
    L. 95-598, title III, Sec. 302, Nov. 6, 1978, 92 Stat. 2673;
    renumbered and amended Pub. L. 97-222, Sec. 20, July 27, 1982, 96
    Stat. 241.)

-MISC1-
                                AMENDMENTS                            
      1982 - Subsec. (a)(3). Pub. L. 97-222, Sec. 20(b), inserted ",
    including the payment and allocation of margin with respect to
    commodity contracts not specifically identifiable to a particular
    customer pending their orderly liquidation".

                              EFFECTIVE DATE                          
      Section effective Nov. 6, 1978, see section 402(d) of Pub. L. 95-
    598, set out as a note preceding section 101 of Title 11,
    Bankruptcy.

-End-

-CITE-
    7 USC Sec. 25                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 25. Private rights of action

-STATUTE-
    (a) Actual damages; actionable transactions; exclusive remedy
      (1) Any person (other than a registered entity or registered
    futures association) who violates this chapter or who willfully
    aids, abets, counsels, induces, or procures the commission of a
    violation of this chapter shall be liable for actual damages
    resulting from one or more of the transactions referred to in
    subparagraphs (A) through (D) of this paragraph and caused by such
    violation to any other person - 
        (A) who received trading advice from such person for a fee;
        (B) who made through such person any contract of sale of any
      commodity for future delivery (or option on such contract or any
      commodity); or who deposited with or paid to such person money,
      securities, or property (or incurred debt in lieu thereof) in
      connection with any order to make such contract;
        (C) who purchased from or sold to such person or placed through
      such person an order for the purchase or sale of - 
          (i) an option subject to section 6c of this title (other than
        an option purchased or sold on a registered entity or other
        board of trade);
          (ii) a contract subject to section 23 of this title; or
          (iii) an interest or participation in a commodity pool; or

        (D) who purchased or sold a contract referred to in
      subparagraph (B) hereof if the violation constitutes a
      manipulation of the price of any such contract or the price of
      the commodity underlying such contract.

      (2) Except as provided in subsection (b) of this section, the
    rights of action authorized by this subsection and by sections
    7(d)(13), 7a-1(b)(1)(E), and 21(b)(10) of this title shall be the
    exclusive remedies under this chapter available to any person who
    sustains loss as a result of any alleged violation of this chapter.
    Nothing in this subsection shall limit or abridge the rights of the
    parties to agree in advance of a dispute upon any forum for
    resolving claims under this section, including arbitration.
      (3) In any action arising from a violation in the execution of an
    order on the floor of a registered entity, the person referred to
    in paragraph (1) shall be liable for - 
        (A) actual damages proximately caused by such violation. If an
      award of actual damages is made against a floor broker in
      connection with the execution of a customer order, and the
      futures commission merchant which selected the floor broker for
      the execution of the customer order is held to be responsible
      under section 2(a)(1) of this title for the floor broker's
      violation, such futures commission merchant may be required to
      satisfy such award; and
        (B) where the violation is willful and intentional, punitive or
      exemplary damages equal to no more than two times the amount of
      such actual damages. If an award of punitive or exemplary damages
      is made against a floor broker in connection with the execution
      of a customer order, and the futures commission merchant which
      selected the floor broker for the execution of the customer order
      is held to be responsible under section 2(a)(1) of this title for
      the floor broker's violation, such futures commission merchant
      may be required to satisfy such award if the floor broker fails
      to do so, except that such requirement shall apply to the futures
      commission merchant only if it willfully and intentionally
      selected the floor broker with the intent to assist or facilitate
      the floor broker's violation.

      (4) Contract enforcement between eligible counterparties. - No
    agreement, contract, or transaction between eligible contract
    participants or persons reasonably believed to be eligible contract
    participants, and no hybrid instrument sold to any investor, shall
    be void, voidable, or unenforceable, and no such party shall be
    entitled to rescind, or recover any payment made with respect to,
    such an agreement, contract, transaction, or instrument under this
    section or any other provision of Federal or State law, based
    solely on the failure of the agreement, contract, transaction, or
    instrument to comply with the terms or conditions of an exemption
    or exclusion from any provision of this chapter or regulations of
    the Commission.
    (b) Liabilities of organizations and individuals; bad faith
      requirement; exclusive remedy
      (1)(A) A registered entity that fails to enforce any bylaw, rule,
    regulation, or resolution that it is required to enforce by
    sections 7 through 7a-2 of this title, (B) a licensed board of
    trade that fails to enforce any bylaw, rule, regulation, or
    resolution that it is required to enforce by the Commission, or (C)
    any registered entity that in enforcing any such bylaw, rule,
    regulation, or resolution violates this chapter or any Commission
    rule, regulation, or order, shall be liable for actual damages
    sustained by a person who engaged in any transaction on or subject
    to the rules of such registered entity to the extent of such
    person's actual losses that resulted from such transaction and were
    caused by such failure to enforce or enforcement of such bylaws,
    rules, regulations, or resolutions.
      (2) A registered futures association that fails to enforce any
    bylaw or rule that is required under section 21 of this title or in
    enforcing any such bylaw or rule violates this chapter or any
    Commission rule, regulation, or order shall be liable for actual
    damages sustained by a person that engaged in any transaction
    specified in subsection (a) of this section to the extent of such
    person's actual losses that resulted from such transaction and were
    caused by such failure to enforce or enforcement of such bylaw or
    rule.
      (3) Any individual who, in the capacity as an officer, director,
    governor, committee member, or employee of registered (!1) entity
    or a registered futures association willfully aids, abets,
    counsels, induces, or procures any failure by any such entity to
    enforce (or any violation of the chapter in enforcing) any bylaw,
    rule, regulation, or resolution referred to in paragraph (1) or (2)
    of this subsection, shall be liable for actual damages sustained by
    a person who engaged in any transaction specified in subsection (a)
    of this section on, or subject to the rules of, such registered
    entity or, in the case of an officer, director, governor, committee
    member, or employee of a registered futures association, any
    transaction specified in subsection (a) of this section, in either
    case to the extent of such person's actual losses that resulted
    from such transaction and were caused by such failure or violation.

      (4) A person seeking to enforce liability under this section must
    establish that the registered entity (!2) registered futures
    association, officer, director, governor, committee member, or
    employee acted in bad faith in failing to take action or in taking
    such action as was taken, and that such failure or action caused
    the loss.

      (5) The rights of action authorized by this subsection shall be
    the exclusive remedy under this chapter available to any person who
    sustains a loss as a result of (A) the alleged failure by a
    registered entity or registered futures association or by any
    officer, director, governor, committee member, or employee to
    enforce any bylaw, rule, regulation, or resolution referred to in
    paragraph (1) or (2) of this subsection, or (B) the taking of
    action in enforcing any bylaw, rule, regulation, or resolution
    referred to in this subsection that is alleged to have violated
    this chapter, or any Commission rule, regulation, or order.
    (c) Jurisdiction; statute of limitations; venue; process
      The United States district courts shall have exclusive
    jurisdiction of actions brought under this section. Any such action
    shall be brought not later than two years after the date the cause
    of action arises. Any action brought under subsection (a) of this
    section may be brought in any judicial district wherein the
    defendant is found, resides, or transacts business, or in the
    judicial district wherein any act or transaction constituting the
    violation occurs. Process in such action may be served in any
    judicial district of which the defendant is an inhabitant or
    wherever the defendant may be found.
    (d) Dates of application to actions
      The provisions of this section shall become effective with
    respect to causes of action accruing on or after the date of
    enactment of the Futures Trading Act of 1982 [January 11, 1983]:
    Provided, That the enactment of the Futures Trading Act of 1982
    shall not affect any right of any parties which may exist with
    respect to causes of action accruing prior to such date.

-SOURCE-
    (Sept. 21, 1922, ch. 369, Sec. 22, as added Pub. L. 97-444, title
    II, Sec. 235, Jan. 11, 1983, 96 Stat. 2322; amended Pub. L. 102-
    546, title II, Secs. 211, 222(d), title IV, Sec. 402(14), Oct. 28,
    1992, 106 Stat. 3607, 3616, 3625; Pub. L. 106-554, Sec. 1(a)(5)
    [title I, Secs. 120, 123(a)(25)], Dec. 21, 2000, 114 Stat. 2763,
    2763A-404, 2763A-410.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Futures Trading Act of 1982, referred to in subsec. (d), is
    Pub. L. 97-444, Jan. 11, 1983, 96 Stat. 2294, which is classified
    generally to this chapter. For complete classification of this Act
    to the Code, see Short Title of 1983 Amendment note set out under
    section 1 of this title and Tables.

-MISC1-
                                AMENDMENTS                            
      2000 - Subsec. (a)(1). Pub. L. 106-554, Sec. 1(a)(5) [title I,
    Sec. 123(a)(25)(A)(i)(I)], substituted "registered entity" for
    "contract market, clearing organization of a contract market,
    licensed board of trade," in introductory provisions.
      Subsec. (a)(1)(C)(i). Pub. L. 106-554, Sec. 1(a)(5) [title I,
    Sec. 123(a)(25)(A)(i)(II)], substituted "registered entity" for
    "contract market".
      Subsec. (a)(2). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(25)(A)(ii)], substituted "sections 7(d)(13), 7a-1(b)(1)(E),"
    for "sections 7a(11),".
      Subsec. (a)(3). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(25)(A)(iii)], substituted "registered entity" for "contract
    market" in introductory provisions.
      Subsec. (a)(4). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    120], added par. (4).
      Subsec. (b)(1). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(25)(B)(i)], substituted "registered entity that fails" for
    "contract market or clearing organization of a contract market that
    fails", "sections 7 through 7a-2 of this title" for "section 7a(8)
    and section 7a(9) of this title", "registered entity that in" for
    "contract market, clearing organization of a contract market, or
    licensed board of trade that in", and "registered entity to the"
    for "contract market or licensed board of trade to the".
      Subsec. (b)(3). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(25)(B)(ii)], substituted "employee of registered entity" for
    "employee of a contract market, clearing organization, licensed
    board of trade," and "such registered entity" for "such contract
    market, licensed board of trade".
      Subsec. (b)(4). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(25)(B)(iii)], substituted "registered entity" for "contract
    market, licensed board of trade, clearing organization,".
      Subsec. (b)(5). Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec.
    123(a)(25)(B)(iv)], substituted "registered entity" for "contract
    market, licensed board of trade, clearing organization,".
      1992 - Subsec. (a)(1). Pub. L. 102-546, Sec. 402(14)(A),
    substituted "subparagraphs" for "clauses" in introductory
    provisions and "subparagraph" for "clause" in subpar. (D).
      Subsec. (a)(2). Pub. L. 102-546, Sec. 402(14)(B), made technical
    amendment to reference to section 21(b)(10) of this title to
    correct reference to corresponding section of original act.
      Subsec. (a)(3). Pub. L. 102-546, Sec. 222(d), added par. (3).
      Subsec. (c). Pub. L. 102-546, Sec. 211, amended subsec. (c)
    generally. Prior to amendment, subsec. (c) read as follows: "The
    United States district courts shall have exclusive jurisdiction of
    actions brought under this section. Any such action must be brought
    within two years after the date the cause of action accrued."

                              EFFECTIVE DATE                          
      Section effective Jan. 11, 1983, see section 239 of Pub. L. 97-
    444, set out as an Effective Date of 1983 Amendment note under
    section 2 of this title.

-FOOTNOTE-
    (!1) So in original. Probably should be preceded by "a".

    (!2) So in original. Probably should be followed by a comma.

-End-

-CITE-
    7 USC Sec. 26                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 26. Repealed.

-MISC1-
    Sec. 26. Repealed. Pub. L. 102-546, title IV, Sec. 402(15), Oct.
      28, 1992, 106 Stat. 3625.
      Section, act Sept. 21, 1922, ch. 369, Sec. 23, as added Jan. 11,
    1983, Pub. L. 97-444, title II, Sec. 236, 96 Stat. 2324, provided
    for special studies to be conducted by Commission, Board of
    Governors of Federal Reserve System, and Securities and Exchange
    Commission.

                              EFFECTIVE DATE                          
      Section effective Jan. 11, 1983, see section 239 of Pub. L. 97-
    444, set out as an Effective Date of 1983 Amendment note under
    section 2 of this title.

-End-

-CITE-
    7 USC Sec. 27                                               01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 27. Definitions

-STATUTE-
    (a) Bank
      In sections 27 to 27f of this title, the term "bank" means - 
        (1) any depository institution (as defined in section 1813(c)
      of title 12);
        (2) any foreign bank or branch or agency of a foreign bank
      (each as defined in section 3101 of title 12);
        (3) any Federal or State credit union (as defined in section
      1752 of title 12);
        (4) any corporation organized under section 25A of the Federal
      Reserve Act [12 U.S.C. 611 et seq.];
        (5) any corporation operating under section 25 of the Federal
      Reserve Act [12 U.S.C. 601 et seq.];
        (6) any trust company; or
        (7) any subsidiary of any entity described in paragraph (!1)
      (1) through (6) of this subsection, if the subsidiary is
      regulated as if the subsidiary were part of the entity and is not
      a broker or dealer (as such terms are defined in section 78c of
      title 15) or a futures commission merchant (as defined in section
      1a(20) of this title).

    (b) Identified banking product
      In sections 27 to 27f of this title, the term "identified banking
    product" shall have the same meaning as in paragraphs (1) through
    (5) of section 206(a) of the Gramm-Leach-Bliley Act, except that in
    applying such section for purposes of sections 27 to 27f of this
    title - 
        (1) the term "bank" shall have the meaning given in subsection
      (a) of this section; and
        (2) the term "qualified investor" means eligible contract
      participant (as defined in section 1a(12) of this title, as in
      effect on December 21, 2000).
    (c) Hybrid instrument
      In sections 27 to 27f of this title, the term "hybrid instrument"
    means an identified banking product not excluded by section 27a of
    this title, offered by a bank, having one or more payments indexed
    to the value, level, or rate of, or providing for the delivery of,
    one or more commodities (as defined in section 1a(4) of this
    title).
    (d) Covered swap agreement
      In sections 27 to 27f of this title, the term "covered swap
    agreement" means a swap agreement (as defined in section 206(b) of
    the Gramm-Leach-Bliley Act), including a credit or equity swap,
    based on a commodity other than an agricultural commodity
    enumerated in section 1a(4) of this title if - 
        (1) the swap agreement - 
          (A) is entered into only between persons that are eligible
        contract participants (as defined in section 1a(12) of this
        title, as in effect on December 21, 2000) at the time the
        persons enter into the swap agreement; and
          (B) is not entered into or executed on a trading facility (as
        defined in section 1a(33) of this title); or

        (2) the swap agreement - 
          (A) is entered into or executed on an electronic trading
        facility (as defined in section 1a(10) of this title);
          (B) is entered into on a principal-to-principal basis between
        parties trading for their own accounts or as described in
        section 1a(12)(B)(ii) of this title;
          (C) is entered into only between persons that are eligible
        contract participants as described in subparagraph (A),
        (B)(ii), or (C) of section 1a(12) of this title, as in effect
        on December 21, 2000, at the time the persons enter into the
        swap agreement; and
          (D) is an agreement, contract or transaction in an excluded
        commodity (as defined in section 1a(13) of this title).

-SOURCE-
    (Pub. L. 106-554, Sec. 1(a)(5) [title IV, Sec. 402], Dec. 21, 2000,
    114 Stat. 2763, 2763A-457.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      Section 25A of the Federal Reserve Act, referred to in subsec.
    (a)(4), is classified to subchapter II (Sec. 611 et seq.) of
    chapter 6 of Title 12, Banks and Banking. Section 25 of the Federal
    Reserve Act, referred to in subsec. (a)(5), is classified to
    subchapter I (Sec. 601 et seq.) of chapter 6 of Title 12.
      Section 206 of the Gramm-Leach-Bliley Act, referred to in
    subsecs. (b) and (d), is section 206 of Pub. L. 106-102 which is
    set out as a note under section 78c of Title 15, Commerce and
    Trade.

-COD-
                               CODIFICATION                           
      Section was enacted as part of the Legal Certainty for Bank
    Products Act of 2000, and also as part of the Commodity Futures
    Modernization Act of 2000, and not as part of the Commodity
    Exchange Act which comprises this chapter.

-MISC1-
                                SHORT TITLE                            
      For short title of sections 27 to 27f of this title as the "Legal
    Certainty for Bank Products Act of 2000", see section 1(a)(5)
    [title IV, Sec. 401] of Pub. L. 106-554, set out as a Short Title
    of 2000 Amendment note under section 1 of this title.

-FOOTNOTE-
    (!1) So in original. Probably should be "paragraphs".

-End-

-CITE-
    7 USC Sec. 27a                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 27a. Exclusion of identified banking products commonly offered
      on or before December 5, 2000

-STATUTE-
      No provision of the Commodity Exchange Act [7 U.S.C. 1 et seq.]
    shall apply to, and the Commodity Futures Trading Commission shall
    not exercise regulatory authority with respect to, an identified
    banking product if - 
        (1) an appropriate banking agency certifies that the product
      has been commonly offered, entered into, or provided in the
      United States by any bank on or before December 5, 2000, under
      applicable banking law; and
        (2) the product was not prohibited by the Commodity Exchange
      Act [7 U.S.C. 1 et seq.] and not regulated by the Commodity
      Futures Trading Commission as a contract of sale of a commodity
      for future delivery (or an option on such a contract) or an
      option on a commodity, on or before December 5, 2000.

-SOURCE-
    (Pub. L. 106-554, Sec. 1(a)(5) [title IV, Sec. 403], Dec. 21, 2000,
    114 Stat. 2763, 2763A-458.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Commodity Exchange Act, referred to in text, is act Sept. 21,
    1922, ch. 369, 42 Stat. 998, as amended, which is classified
    generally to this chapter. For complete classification of this Act
    to the Code, see section 1 of this title and Tables.

-COD-
                               CODIFICATION                           
      Section was enacted as part of the Legal Certainty for Bank
    Products Act of 2000, and also as part of the Commodity Futures
    Modernization Act of 2000, and not as part of the Commodity
    Exchange Act which comprises this chapter.

-End-

-CITE-
    7 USC Sec. 27b                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 27b. Exclusion of certain identified banking products offered
      by banks after December 5, 2000

-STATUTE-
      No provision of the Commodity Exchange Act [7 U.S.C. 1 et seq.]
    shall apply to, and the Commodity Futures Trading Commission shall
    not exercise regulatory authority with respect to, an identified
    banking product which had not been commonly offered, entered into,
    or provided in the United States by any bank on or before December
    5, 2000, under applicable banking law if - 
        (1) the product has no payment indexed to the value, level, or
      rate of, and does not provide for the delivery of, any commodity
      (as defined in section 1a(4) of the Commodity Exchange Act [7
      U.S.C. 1a(4)]); or
        (2) the product or commodity is otherwise excluded from the
      Commodity Exchange Act [7 U.S.C. 1 et seq.].

-SOURCE-
    (Pub. L. 106-554, Sec. 1(a)(5) [title IV, Sec. 404], Dec. 21, 2000,
    114 Stat. 2763, 2763A-459.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Commodity Exchange Act, referred to in text, is act Sept. 21,
    1922, ch. 369, 42 Stat. 998, as amended, which is classified
    generally to this chapter. For complete classification of this Act
    to the Code, see section 1 of this title and Tables.

-COD-
                               CODIFICATION                           
      Section was enacted as part of the Legal Certainty for Bank
    Products Act of 2000, and also as part of the Commodity Futures
    Modernization Act of 2000, and not as part of the Commodity
    Exchange Act which comprises this chapter.

-End-

-CITE-
    7 USC Sec. 27c                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 27c. Exclusion of certain other identified banking products

-STATUTE-
    (a) In general
      No provision of the Commodity Exchange Act [7 U.S.C. 1 et seq.]
    shall apply to, and the Commodity Futures Trading Commission shall
    not exercise regulatory authority with respect to, a banking
    product if the product is a hybrid instrument that is predominantly
    a banking product under the predominance test set forth in
    subsection (b) of this section.
    (b) Predominance test
      A hybrid instrument shall be considered to be predominantly a
    banking product for purposes of this section if - 
        (1) the issuer of the hybrid instrument receives payment in
      full of the purchase price of the hybrid instrument substantially
      contemporaneously with delivery of the hybrid instrument;
        (2) the purchaser or holder of the hybrid instrument is not
      required to make under the terms of the instrument, or any
      arrangement referred to in the instrument, any payment to the
      issuer in addition to the purchase price referred to in paragraph
      (1), whether as margin, settlement payment, or otherwise during
      the life of the hybrid instrument or at maturity;
        (3) the issuer of the hybrid instrument is not subject by the
      terms of the instrument to mark-to-market margining requirements;
      and
        (4) the hybrid instrument is not marketed as a contract of sale
      of a commodity for future delivery (or option on such a contract)
      subject to the Commodity Exchange Act [7 U.S.C. 1 et seq.].
    (c) Mark-to-market margining requirement
      For purposes of subsection (b)(3) of this title, mark-to-market
    margining requirements shall not include the obligation of an
    issuer of a secured debt instrument to increase the amount of
    collateral held in pledge for the benefit of the purchaser of the
    secured debt instrument to secure the repayment obligations of the
    issuer under the secured debt instrument.

-SOURCE-
    (Pub. L. 106-554, Sec. 1(a)(5) [title IV, Sec. 405], Dec. 21, 2000,
    114 Stat. 2763, 2763A-459.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Commodity Exchange Act, referred to in subsecs. (a) and
    (b)(4), is act Sept. 21, 1922, ch. 369, 42 Stat. 998, as amended,
    which is classified generally to this chapter. For complete
    classification of this Act to the Code, see section 1 of this title
    and Tables.

-COD-
                               CODIFICATION                           
      Section was enacted as part of the Legal Certainty for Bank
    Products Act of 2000, and also as part of the Commodity Futures
    Modernization Act of 2000, and not as part of the Commodity
    Exchange Act which comprises this chapter.

-End-

-CITE-
    7 USC Sec. 27d                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 27d. Administration of the predominance test

-STATUTE-
    (a) In general
      No provision of the Commodity Exchange Act [7 U.S.C. 1 et seq.]
    shall apply to, and the Commodity Futures Trading Commission shall
    not regulate, a hybrid instrument, unless the Commission
    determines, by or under a rule issued in accordance with this
    section, that - 
        (1) the action is necessary and appropriate in the public
      interest;
        (2) the action is consistent with the Commodity Exchange Act [7
      U.S.C. 1 et seq.] and the purposes of the Commodity Exchange Act;
      and
        (3) the hybrid instrument is not predominantly a banking
      product under the predominance test set forth in section 27c(b)
      of this title.
    (b) Consultation
      Before commencing a rulemaking or making a determination pursuant
    to a rule issued under sections 27 to 27f of this title, the
    Commodity Futures Trading Commission shall consult with and seek
    the concurrence of the Board of Governors of the Federal Reserve
    System concerning - 
        (1) the nature of the hybrid instrument; and
        (2) the history, purpose, extent, and appropriateness of the
      regulation of the hybrid instrument under the Commodity Exchange
      Act [7 U.S.C. 1 et seq.] and under appropriate banking laws.
    (c) Objection to Commission regulation
      (1) Filing of petition for review
        The Board of Governors of the Federal Reserve System may obtain
      review of any rule or determination referred to in subsection (a)
      of this section in the United States Court of Appeals for the
      District of Columbia Circuit by filing in the court, not later
      than 60 days after the date of publication of the rule or
      determination, a written petition requesting that the rule or
      determination be set aside. Any proceeding to challenge any such
      rule or determination shall be expedited by the court.
      (2) Transmittal of petition and record
        A copy of a petition described in paragraph (1) shall be
      transmitted as soon as possible by the Clerk of the court to an
      officer or employee of the Commodity Futures Trading Commission
      designated for that purpose. Upon receipt of the petition, the
      Commission shall file with the court the rule or determination
      under review and any documents referred to therein, and any other
      relevant materials prescribed by the court.
      (3) Exclusive jurisdiction
        On the date of the filing of a petition under paragraph (1),
      the court shall have jurisdiction, which shall become exclusive
      on the filing of the materials set forth in paragraph (2), to
      affirm and enforce or to set aside the rule or determination at
      issue.
      (4) Standard of review
        The court shall determine to affirm and enforce or set aside a
      rule or determination of the Commodity Futures Trading Commission
      under this section, based on the determination of the court as to
      whether - 
          (A) the subject product is predominantly a banking product;
        and
          (B) making the provision or provisions of the Commodity
        Exchange Act [7 U.S.C. 1 et seq.] at issue applicable to the
        subject instrument is appropriate in light of the history,
        purpose, and extent of regulation under such Act, sections 27
        to 27f of this title, and under the appropriate banking laws,
        giving deference neither to the views of the Commodity Futures
        Trading Commission nor the Board of Governors of the Federal
        Reserve System.
      (5) Judicial stay
        The filing of a petition by the Board pursuant to paragraph (1)
      shall operate as a judicial stay, until the date on which the
      determination of the court is final (including any appeal of the
      determination).
      (6) Other authority to challenge
        Any aggrieved party may seek judicial review pursuant to
      section 6(c) of the Commodity Exchange Act [7 U.S.C. 9, 15] of a
      determination or rulemaking by the Commodity Futures Trading
      Commission under this section.

-SOURCE-
    (Pub. L. 106-554, Sec. 1(a)(5) [title IV, Sec. 406], Dec. 21, 2000,
    114 Stat. 2763, 2763A-459.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Commodity Exchange Act, referred to in subsecs. (a), (b)(2),
    and (c)(4)(B), is act Sept. 21, 1922, ch. 369, 42 Stat. 998, as
    amended, which is classified generally to this chapter. For
    complete classification of this Act to the Code, see section 1 of
    this title and Tables.

-COD-
                               CODIFICATION                           
      Section was enacted as part of the Legal Certainty for Bank
    Products Act of 2000, and also as part of the Commodity Futures
    Modernization Act of 2000, and not as part of the Commodity
    Exchange Act which comprises this chapter.

-End-

-CITE-
    7 USC Sec. 27e                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 27e. Exclusion of covered swap agreements

-STATUTE-
      No provision of the Commodity Exchange Act [7 U.S.C. 1 et seq.]
    (other than section 5b of such Act [7 U.S.C. 7a-1] with respect to
    the clearing of covered swap agreements) shall apply to, and the
    Commodity Futures Trading Commission shall not exercise regulatory
    authority with respect to, a covered swap agreement offered,
    entered into, or provided by a bank.

-SOURCE-
    (Pub. L. 106-554, Sec. 1(a)(5) [title IV, Sec. 407], Dec. 21, 2000,
    114 Stat. 2763, 2763A-461.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Commodity Exchange Act, referred to in text, is act Sept. 21,
    1922, ch. 369, 42 Stat. 998, as amended, which is classified
    generally to this chapter. For complete classification of this Act
    to the Code, see section 1 of this title and Tables.

-COD-
                               CODIFICATION                           
      Section was enacted as part of the Legal Certainty for Bank
    Products Act of 2000, and also as part of the Commodity Futures
    Modernization Act of 2000, and not as part of the Commodity
    Exchange Act which comprises this chapter.

-End-

-CITE-
    7 USC Sec. 27f                                              01/03/2007

-EXPCITE-
    TITLE 7 - AGRICULTURE
    CHAPTER 1 - COMMODITY EXCHANGES

-HEAD-
    Sec. 27f. Contract enforcement

-STATUTE-
    (a) Hybrid instruments
      No hybrid instrument shall be void, voidable, or unenforceable,
    and no party to a hybrid instrument shall be entitled to rescind,
    or recover any payment made with respect to, a hybrid instrument
    under any provision of Federal or State law, based solely on the
    failure of the hybrid instrument to satisfy the predominance test
    set forth in section 27c(b) of this title or to comply with the
    terms or conditions of an exemption or exclusion from any provision
    of the Commodity Exchange Act [7 U.S.C. 1 et seq.] or any
    regulation of the Commodity Futures Trading Commission.
    (b) Covered swap agreements
      No covered swap agreement shall be void, voidable, or
    unenforceable, and no party to a covered swap agreement shall be
    entitled to rescind, or recover any payment made with respect to, a
    covered swap agreement under any provision of Federal or State law,
    based solely on the failure of the covered swap agreement to comply
    with the terms or conditions of an exemption or exclusion from any
    provision of the Commodity Exchange Act [7 U.S.C. 1 et seq.] or any
    regulation of the Commodity Futures Trading Commission.
    (c) Preemption
      Sections 27 to 27f of this title shall supersede and preempt the
    application of any State or local law that prohibits or regulates
    gaming or the operation of bucket shops (other than antifraud
    provisions of general applicability) in the case of - 
        (1) a hybrid instrument that is predominantly a banking
      product; or
        (2) a covered swap agreement.

-SOURCE-
    (Pub. L. 106-554, Sec. 1(a)(5) [title IV, Sec. 408], Dec. 21, 2000,
    114 Stat. 2763, 2763A-461.)

-REFTEXT-
                            REFERENCES IN TEXT                        
      The Commodity Exchange Act, referred to in subsecs. (a) and (b),
    is act Sept. 21, 1922, ch. 369, 42 Stat. 998, as amended, which is
    classified generally to this chapter. For complete classification
    of this Act to the Code, see section 1 of this title and Tables.

-COD-
                               CODIFICATION                           
      Section was enacted as part of the Legal Certainty for Bank
    Products Act of 2000, and also as part of the Commodity Futures
    Modernization Act of 2000, and not as part of the Commodity
    Exchange Act which comprises this chapter.

-End-