A bill to amend the Commodity Exchange Act to clarify the treatment of purchases of certain commodity futures contracts and financial instruments with respect to limits established by the Commodity Futures Trading Commission relating to excessive speculation, and for other purposes.

Summary: Commodity Speculation Reform Act of 2009 - Amends the Commodity Exchange Act to prohibit the Commodity Futures Trading Commission (CFTC) from issuing a no action letter to any foreign board of trade that lists a contract whose price settles on the price of a contract traded on a CFTC-regulated exchange, unless the foreign board provides the CFTC with information and data accessibility comparable to those provided the CFTC by entities under its jurisdiction.

Directs the CFTC to promulgate regulations to establish and enforce speculative position limits for qualifying commodities, a methodology for aggregating specified positions, and information reporting rules to facilitate monitoring and enforcement of speculative position limits and over-the-counter commodity derivatives.

Prohibits a person from holding or controlling a position, separately or in combination, net long or net short, for the purchase or sale of a commodity for future delivery or, on a futures-equivalent basis, any option, or an over-the-counter commodity derivative that exceeds CFTC speculative position limits.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Commodity Speculation Reform Act of 
2009''.

SEC. 2. AUTHORITY OF COMMODITY FUTURES TRADING COMMISSION TO ISSUE NO 
              ACTION LETTERS.

    Section 2(a)(1) of the Commodity Exchange Act (7 U.S.C. 2(a)(1)) is 
amended by adding at the end the following:
                    ``(G) Authority to issue no action letters to 
                foreign boards of trade.--
                            ``(i) In general.--Except as provided in 
                        clause (ii), the Commission may not issue a no 
                        action letter to any foreign board of trade 
                        that lists a contract the price of which 
                        settles on the price of a contract traded on an 
                        exchange regulated by the Commission.
                            ``(ii) Exception.--The Commission may issue 
                        a no action letter to a foreign board of trade 
                        described in clause (i) if the foreign board of 
                        trade provides to the Commission information 
                        and data accessibility the scope of which is 
                        comparable to the information and data 
                        accessibility provided to the Commission by 
                        entities under the jurisdiction of the 
                        Commission.''.

SEC. 3. TREATMENT OF PURCHASES OF CERTAIN COMMODITY FUTURES CONTRACTS 
              AND FINANCIAL INSTRUMENTS.

    Section 4a of the Commodity Exchange Act (7 U.S.C. 6a) is amended--
            (1) by striking ``sec. 4a. (a) Excessive speculation'' and 
        inserting the following:

``SEC. 4A. EXCESSIVE SPECULATION.

    ``(a) Burden on Interstate Commerce; Trading or Position Limits.--
            ``(1) In general.--Excessive speculation and''; and
            (2) in subsection (a) (as amended by paragraph (1)), by 
        adding at the end the following:
            ``(2) Treatment of purchases of certain commodity futures 
        contracts and financial instruments.--
                    ``(A) Definitions.--In this paragraph:
                            ``(i) Bona fide hedging transaction.--
                                    ``(I) In general.--The term `bona 
                                fide hedging transaction' means a 
                                transaction that--
                                            ``(aa) represents a 
                                        substitute for a transaction to 
                                        be made or a position to be 
                                        taken at a later time in a 
                                        physical marketing channel;
                                            ``(bb) is economically 
                                        appropriate for the reduction 
                                        of risks in the conduct and 
                                        management of a commercial 
                                        enterprise; and
                                            ``(cc) arises from the 
                                        potential change in the value 
                                        of--

                                                    ``(AA) assets that 
                                                a person owns, 
                                                produces, manufactures, 
                                                possesses, or 
                                                merchandises (or 
                                                anticipates owning, 
                                                producing, 
                                                manufacturing, 
                                                possessing, or 
                                                merchandising);

                                                    ``(BB) liabilities 
                                                that a person incurs or 
                                                anticipates incurring; 
                                                or

                                                    ``(CC) services 
                                                that a person provides 
                                                or purchases (or 
                                                anticipates providing 
                                                or purchasing).

                                    ``(II) Exclusion.--The term `bona 
                                fide hedging transaction' does not 
                                include a transaction entered into on a 
                                designated contract market for the 
                                purpose of offsetting a financial risk 
                                arising from an over-the-counter 
                                commodity derivative.
                            ``(ii) Over-the-counter commodity 
                        derivative.--The term `over-the-counter 
                        commodity derivative' means any agreement, 
                        contract, or transaction that--
                                    ``(I)(aa) is traded or executed in 
                                the United States; or
                                    ``(bb) is held by a person located 
                                in the United States;
                                    ``(II) is not traded on a 
                                designated contract market or 
                                derivatives transaction execution 
                                facility; and
                                    ``(III)(aa) is a put, call, cap, 
                                floor, collar, or similar option of any 
                                kind for the purchase or sale of, or 
                                substantially based on the value of, 1 
                                or more qualifying commodities or an 
                                economic or financial index or measure 
                                of economic or financial risk primarily 
                                associated with 1 or more qualifying 
                                commodities;
                                    ``(bb) provides on an executory 
                                basis for the applicable transaction, 
                                on a fixed or contingent basis, of 1 or 
                                more payments substantially based on 
                                the value of 1 or more qualifying 
                                commodities or an economic or financial 
                                index or measure of economic or 
                                financial risk primarily associated 
                                with 1 or more qualifying commodities, 
                                and that transfers between the parties 
                                to the transaction, in whole or in 
                                part, the economic or financial risk 
                                associated with a future change in any 
                                such value without also conveying a 
                                current or future direct or indirect 
                                ownership interest in an asset or 
                                liability that incorporates the 
                                financial risk that is transferred; or
                                    ``(cc) is any combination or 
                                permutation of, or option on, any 
                                agreement, contract, or transaction 
                                described in item (aa) or (bb).
                            ``(iii) Over-the-counter commodity 
                        derivative dealer.--The term `over-the-counter 
                        commodity derivative dealer' means a person 
                        that regularly offers to enter into, assume, 
                        offset, assign, or otherwise terminate 
                        positions in over-the-counter commodity 
                        derivatives with customers in the ordinary 
                        course of a trade or business of the person.
                            ``(iv) Qualifying commodity.--The term 
                        `qualifying commodity' means--
                                    ``(I) an agricultural commodity; 
                                and
                                    ``(II) an energy commodity.
                    ``(B) Regulations.--
                            ``(i) In general.--Not later than 90 days 
                        after the date of enactment of this paragraph, 
                        in accordance with clauses (ii) and (iii), the 
                        Commission shall promulgate regulations to 
                        establish and enforce--
                                    ``(I) speculative position limits 
                                for qualifying commodities;
                                    ``(II) a methodology--
                                            ``(aa) to enable persons to 
                                        aggregate the positions held or 
                                        controlled by the persons on 
                                        designated contract markets, on 
                                        derivatives transaction 
                                        execution facilities, and in 
                                        over-the-counter commodity 
                                        derivatives; and
                                            ``(bb) to ensure, to the 
                                        maximum extent practicable, 
                                        that the determinations made by 
                                        the Commission with respect to 
                                        each person examined under 
                                        subparagraph (C) accurately 
                                        reflect the net long and net 
                                        short positions held or 
                                        controlled by the person in the 
                                        underlying qualifying 
                                        commodity; and
                                    ``(III) information reporting rules 
                                to facilitate the monitoring and 
                                enforcement by the Commission of the 
                                speculative position limits established 
                                under subclause (I), including the 
                                monitoring of positions held in over-
                                the-counter commodity derivatives.
                            ``(ii) Applicability.--
                                    ``(I) Position limits.--The 
                                speculative position limits established 
                                under clause (i)(I) shall apply to 
                                position limits that, with respect to 
                                each applicable position limit, expire 
                                during--
                                            ``(aa) the spot month;
                                            ``(bb) each separate 
                                        futures trading month (other 
                                        than the spot month); or
                                            ``(cc) the sum of each 
                                        trading month (including the 
                                        spot month).
                                    ``(II) Sum of positions.--The 
                                speculative position limits established 
                                under clause (i)(I) shall apply to the 
                                sum of the positions held by a person--
                                            ``(aa) on designated 
                                        contract markets;
                                            ``(bb) on derivatives 
                                        transaction execution 
                                        facilities; and
                                            ``(cc) in over-the-counter 
                                        commodity derivatives.
                            ``(iii) Maximum level of position limits.--
                        In establishing the speculative position limits 
                        under clause (i)(I), the Commission shall set 
                        the speculative position limits at the minimum 
                        level practicable to ensure sufficient market 
                        liquidity for the conduct of bona fide hedging 
                        activities.
                    ``(C) Prohibition relating to certain positions.--
                            ``(i) In general.--Notwithstanding any 
                        other provision of this Act, no person may hold 
                        or control a position, separately or in 
                        combination, net long or net short, for the 
                        purchase or sale of a commodity for future 
                        delivery or, on a futures-equivalent basis, any 
                        option, or an over-the-counter commodity 
                        derivative that exceeds a speculative position 
                        limit established by the Commission under 
                        subparagraph (B)(i)(I).
                            ``(ii) Bona fide hedging transactions.--In 
                        determining whether the sum of a position held 
                        or controlled by a person has exceeded the 
                        applicable speculative position limit 
                        established by the Commission under 
                        subparagraph (B)(i)(I), the Commission shall 
                        not consider positions attributable to a bona 
                        fide hedging transaction.
                            ``(iii) Determination of position limits 
                        for over-the-counter commodity derivative 
                        dealers.--To determine the position of an over-
                        the-counter commodity derivative dealer, the 
                        sum of the positions held or controlled by the 
                        over-the-counter commodity derivative dealer 
                        shall be--
                                    ``(I) calculated on the last day of 
                                each month; and
                                    ``(II) considered, for the monthly 
                                period covered by the determination, to 
                                be the average daily net position held 
                                or controlled by the over-the-counter 
                                commodity derivative dealer for the 
                                period beginning on the first day of 
                                the month and ending on the last day of 
                                the month.''.