CHAPTER 5
TRADING QUALIFICATIONS AND PRACTICES
500.

501.
502.
503.
504.
505.
506.

507.

508.
509.

510.
511.

512.

513.

514.

515.

516.

SCOPE OF CHAPTER
FLOOR PRIVILEGESEMPLOYEES OF MEMBERSADMISSION TO FLOORRETIRED MEMBERS[RESERVED]
BOOTH AND FLOOR PRIVILEGESHEADSET PRIVILEGES ON THE TRADING FLOOR
506.A. Access and Supervision
506.B. Use of Headsets
ELECTRONIC DEVICES
507.A. General Provisions
507.B. Terms and Conditions of Use
507.C. Electronic Surveillance
507.D. Personal Electronic Devices
507.E. Cameras and Video Equipment
GIVING AND RECEIVING OF GRATUITIESACCOUNTS OF MEMBERS AND MEMBER FIRMSTRADING QUALIFICATIONS AND REGULATIONSREQUIREMENTS FOR MEMBERS AND THEIR EMPLOYEES ON THE
TRADING FLOORQUALIFIED TRADERS AND BROKERS
511.A. Floor Trading
511.B. Globex Trading
REPORTING INFRACTIONS
512.A. General
512.B. Sanctions
512.C. Hearings and Appeals
CONDUCT, APPAREL AND BADGES
513.A. General
513.B. Sanctions
513.C. Hearings and Appeals
TRADING INFRACTIONS
514.A. Definition
514.B. Floor Conduct Committee Fining Authority
REGISTRATION AND IDENTIFICATION OF BROKER ASSOCIATIONS
515.A. Definitions
515.B. Registration Requirements
515.C. Prohibition on Sharing of Personal Trading Profits
515.D. Supervision
515.E. Trading Restrictions
ERROR ACCOUNTS© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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517.-519.

520.
521.
522.
523.
524.

525.
526.
527.

528.
529.
530.
531.

532.
533.
534.
535.
536.

537.
538.

[RESERVED]
TRADING PRACTICESTRADING CONFINED TO EXCHANGE FACILITIESREQUIREMENTS FOR OPEN OUTCRY TRADES
ACCEPTANCE OF BIDS AND OFFERS
ALL-OR-NONE TRANSACTIONSTRADING AT SETTLEMENT (“TAS”), BASIS TRADE AT INDEX CLOSE (“BTIC”) AND BASIS
TRADE AT CASH OPEN (“TACO”) AND TRADE MARKER AT CLOSE (“TMAC”)
TRANSACTIONS
524.A. Trading at Settlement (“TAS”) Transactions
524.B. Basis Trade at Index Close (“BTIC”) Transactions
524.C. Basis Trade at Cash Open (“TACO”) Transactions
524.D. Trade Marker at Close (“TMAC”) Transactions[RESERVED]BLOCK TRADESOUTTRADES, ERRORS AND MISHANDLING OF ORDERS
527.A. Outtrades Discovered During a Regular Trading Hours Trading Session
527.B. Outtrades Discovered After a Regular Trading Hours Trading Session
527.C. Outtrades Resolution
527.D. Errors and Mishandling of Orders
PRICE REPORTING
WITHHOLDING ORDERS PROHIBITEDPRIORITY OF CUSTOMERS’ ORDERS
TRADING AGAINST CUSTOMERS’ ORDERS PROHIBITED
531.A. General Prohibition
531.B. Exceptions
IMPROPER USE OR DISCLOSURE OF NON-PUBLIC INFORMATION PROHIBITEDSIMULTANEOUS BUY AND SELL ORDERS FOR DIFFERENT BENEFICIAL OWNERSWASH TRADES PROHIBITEDRESPONSIBILITY OF FLOOR TRADERS AND FLOOR BROKERS
RECORDKEEPING REQUIREMENTS FOR PIT, GLOBEX, AND NEGOTIATED TRADES
536.A. General Requirements for Open Outcry Pit Trades
536.B. Globex Order Entry
536.C. Bunched Orders and Orders Eligible for Post Execution
Allocation
536.D. Customer Type Indicator (CTI) Codes
536.E. Negotiated Trades
536.F. Audit Trail Violations
536.G. Telephone Recordings
536.H. Retention of Records
DATA SUBMITTED TO THE EXCHANGEEXCHANGE FOR RELATED POSITIONS
538.A. Parties to an EFRP
538.B. Independently Controlled Accounts
538.C. Related Position
538.D. EFPs in Connection with Inventory Financing of Storable, Non-Financial Commodities© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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539.

540.

541.
542.
543.
544.
545.
546.
547.
548.
549.-552
553.

554.-558.
559.

560.
561.

562.
563.-569.

538.E. Quantity Equivalence
538.F. Prices and Price Increments
538.G. EFRPs Following the Termination of Trading in Exchange Contracts
538.H. Recordkeeping
538.I. Submission to the Clearing House
538.J. EFRP Volumes Required to be Reported with Daily Large Trader Positions
538.K. Immediately Offsetting EFPs in Foreign Currency Futures
PREARRANGED, PRE-NEGOTIATED AND NONCOMPETITIVE TRADES
PROHIBITED
539.A. General Prohibition
539.B. Exceptions
539.C. Pre-Execution Communications Regarding Globex Trades
RESPONSIBILITY FOR CUSTOMER ORDERS
540.A. Standard of Responsibility
540.B. Liability for Negligence[RESERVED]SIMULTANEOUS SPREAD AND COMBINATION TRANSACTIONSRESTRICTIONS ON ACCESS FOR SANCTIONED PARTIES AND JURISDICTIONSCLOSING DAY ORDERS[RESERVED]
OPENING AND CLOSING RANGES DURING REGULAR TRADINGHOURSDISCRETIONARY ORDERSPRIORITY OF EXECUTION[RESERVED]
AVERAGE PRICE SYSTEM
553.A. Application of Average Prices
553.B. Average Price System Requirements
553.C. Computation of Average Price
553.D. Disclosure[RESERVED]POSITION LIMITS AND EXEMPTIONS
559.A. Bona Fide Hedging Transactions or Positions
559.B. Non-Enumerated Bona Fide Hedging Transactions or Positions
559.C. Spread Positions
559.D. Aggregation of Positions
559.E. Exemptions from Aggregation
559.F. Violations
POSITION ACCOUNTABILITYSUBMISSION OF LARGE TRADER POSITIONS AND VOLUME THRESHOLD ACCOUNTS
561.A. Large Trader Reporting
561.B. Volume Threshold Reporting
561.C. Obligations of Omnibus Accounts and Foreign Brokers
561.D. Reportable Levels
POSITION LIMIT VIOLATIONS[RESERVED]© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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570.

571.-572.

573.
574.
575.
576.
577.
578.
579.

580.
581.-582 .
583.

584.-587.
588.

589.

RESTRICTION ON SALE OF EXCHANGE PRODUCTS IN THE EUROPEAN UNION TO
EUROPEAN UNION RETAIL INVESTORS UNDER PRIIPS [PACKAGE RETAIL AND
INSURANCE BASED INVESTMENT PRODUCT][RESERVED]GLOBEX ELECTRONIC TRADING SYSTEM RULES
GLOBEX OPENING
GLOBEX ACCESS RESTRICTIONSDISRUPTIVE PRACTICES PROHIBITEDIDENTIFICATION OF GLOBEX TERMINAL OPERATORS[RESERVED]
LIMITATION OF LIABILITY, NO WARRANTIESGLOBAL COMMAND CENTER (“GCC”)
579.A. GCC Authority
579.B. GCC Services
579.C. Order Status
CME GLOBEX TRADE MATCHING ALGORITHMS[RESERVED]DOMESTIC CROSS-EXCHANGE TRADING
583.A. Cross-Exchange Trading by Members of Other Domestic
Exchanges in Contracts Listed on Globex
583.B. Cross-Exchange Trading by Members of CME in Contract
Listed on Globex or Other Electronic Trading Systems byParticipating Domestic Exchanges[RESERVED]
TRADE CANCELLATIONS AND PRICE ADJUSTMENTS
588.A. Global Command Center Authority Regarding Trade Cancellations and Price
Adjustments
588.B. Review of Trades
588.C. Price Adjustments and Cancellations
588.D. Alternative Resolution by Agreement of Parties
588.E. Liability for Losses Resulting from Price Adjustments or Cancellations and Prohibition
On Claims for Losses Arising from Error Trades Executed Within the NonReviewable Range
588.F. Permissible Responses to Phantom Orders
588.G. Schedule of Administrative Fees
588.H. Globex Non-Reviewable Trading Ranges
SPECIAL PRICE FLUCTUATION LIMITS
589.A. Initial Price Fluctuation Limits for All Contract Months
589.B. Triggering Events and Temporary Trading Halts
589.C. Price Fluctuation Limits on Trading Floor (Floor Trading)
589.D. Dynamic Price Fluctuation Limits

POSITION LIMIT, POSITION ACCOUNTABILITY AND REPORTABLE LEVEL TABLE
SPECIAL PRICE FLUCTUATIONS LIMITS AND DAILY PRICE LIMITS TABLE© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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TRADING AT SETTLEMENT (“TAS”), BASIS TRADE AT INDEX CLOSE (‘BTIC”) AND BASIS TRADE AT CASH
OPEN (“TACO”) TABLE
RULE 539.C. CROSSING PROTOCOLS TABLE
INTERPRETATIONS & SPECIAL NOTICES RELATING TO CHAPTER 5
ACCESS, CONDUCT AND APPEARANCE CODEQUOTATION CHANGES© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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Chapter 5
Trading Qualifications and Practices
500.
5B

SCOPE OF CHAPTER
This chapter prescribes rules concerning floor access privileges, qualifications for trading privileges,
and trading practices.

FLOOR PRIVILEGES
0B

501.
6B

EMPLOYEES OF MEMBERS
Members shall register with the Exchange all persons whom they wish to employ on the trading floor.
Such employees may act as runners, communicators, clerks and broker assistants. Such employees
shall not be permitted to solicit customers or benefit from the production of orders. Such employees
shall not trade or have any interest in an account trading in any CME futures or options contracts.
Employees must wear a prescribed identification badge. Any member permitting trading by such
employee shall be guilty of an offense against the Exchange. Remuneration to such employees shallbe limited to salaries and normal bonuses. The member employer shall, upon request, provide areport to Exchange staff with respect to each such employee, setting forth the hours of employment,salary and bonus, and a copy of each employee's Internal Revenue Service W-2 Form or otherdocumentation evidencing employment.
The following shall apply to any IMM, IOM or GEM member who also holds a broker assistant badge.
Such person shall not trade for, or carry in his account or an account in which he has any interest,
any positions in contracts traded on the Exchange except for those contracts which he is entitled to
trade as principal or broker for others by virtue of his membership status as referenced above.
A member holding a broker assistant badge shall be required to notify his qualifying clearing member,as defined in Rule 903, of the name, address and immediate supervisor of the member or member
firm by whom he is employed as a broker assistant. Upon a qualifying clearing member’s revocationof trading authorization in accordance with Rule 903.E., the qualifying clearing member immediately
shall give written notice to the member or member firm which employs a member as a broker
assistant that the member’s trading authorization has been revoked. A member holding a broker
assistant badge shall be denied floor access privileges upon the revocation of trading authorization
by his qualifying clearing member. The floor access privileges of a member who holds a broker
assistant badge may be reinstated upon the filing of a release with the Shareholder Relations andMembership Services Department by the member’s qualifying clearing member in accordance with
Rule 903.D.
Members shall be responsible for ensuring that their employees comply with all Exchange rules andmay, subject to a determination by an Exchange disciplinary committee, be liable for any fines
imposed upon such employees by the Exchange. The Exchange may, in its sole discretion, notify amember of the existence of an Exchange investigation and the conduct which is the subject of theinvestigation involving one of the member’s employees when the Market Regulation Department
interviews such employee or, if no such interview occurs, when charges are issued against theemployee by the Chief Regulatory Officer.
No person shall be registered as an employee pursuant to this rule if such person is determined by
Exchange staff not to be of good moral character or if it is determined that such registration may be
detrimental to the interest or welfare of the Exchange.

502.
7B

ADMISSION TO FLOOR
In addition to authorized employees and agents of the Exchange, only members, registeredemployees of members, permit holders and authorized visitors shall be permitted on the floor of the
Exchange. No person may be introduced on the floor of the Exchange by a member on more than
three days of any calendar month. Members must at all times accompany visitors for whom they
have obtained floor access and are responsible for the conduct and actions of visitors for whom they
have obtained floor access while such visitors are on Exchange premises. No privileges other thanadmittance to the floor may be extended to a guest. A guest is specifically prohibited from performing
any of the functions of an employee of a member or member firm, entering a trading pit, placing
orders, using any electronic devices or market display equipment and blocking aisleways or access© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

Page 6 of 50

to trading pits.

503.

RETIRED MEMBERS

8B

Any member who has been a member for at least 25 years who sells or leases his membership may
apply for a retired member badge which will entitle the retired member to access the trading floor. A
retired member who leases his membership to another person may place orders for his own accountfrom on the trading floor pursuant to the customer order entry requirements set forth in Rule 536.A.1.
A retired member who sells his membership is prohibited from placing orders for any account whileon the trading floor. Retired members are prohibited from accessing the trading pits during trading
hours.

504.

[RESERVED]

505.

BOOTH AND FLOOR PRIVILEGES

9B

10B

Booth space on the trading floor may be assigned only to clearing member firms. Available boothspace will be assigned by Exchange staff in accordance with the policies established by the
Exchange and the decisions of Exchange staff regarding the assignment of booth space shall befinal. Clearing member firms may allocate assigned booth space to 1) members qualified by theclearing member firm or 2) member firms with which it has a clearing relationship with respect toexchange products.
Orders may be accepted at or relayed from the booth space assigned to a clearing member firm or
allocated to a member or member firm by the clearing member firm only by employees of themember, member firm or clearing member firm and members qualified by the clearing member firm.
Notwithstanding any other rule, any member who is associated as a partner, shareholder, member,officer, manager, employee, or consultant with any entity or natural person that is or should be
registered as an Introducing Broker (“IB”), Futures Commission Merchant (“FCM”), Commodity
Trading Advisor (“CTA”) or Commodity Pool Operator (“CPO”) as those terms are defined in Section
1a of the Commodity Exchange Act and/or 17 C.F.R. 1.3, may not solicit orders of others from thefloor of the Exchange unless the entity or natural person for which or for whom the member issoliciting orders is also a member firm or member of the Exchange. Additionally, IBs, FCMs, CTAs
and CPOs may not operate from booth spaces on the trading floor unless they are member firms orwholly owned by members or member firms.

506.

HEADSET PRIVILEGES ON THE TRADING FLOOR

1B

506.A.
Access and Supervision
Members and member firms are eligible to use headsets on the trading floor unless such usage isrestricted in a particular pit by Exchange policy. Where headset usage is permitted, members andmember firms may authorize their nonmember employees to utilize headsets subject to theirsupervision. For the purposes of this rule, a telephone in, or on the perimeter of, a trading pit shallbe treated in the same manner as a headset.
Members and member firms are eligible to lease headsets from the Exchange by filing an application
with the Telecommunications Department. Alternatively, members and member firms may use
headsets obtained from a third-party provided the Exchange authorizes use of the third-party
headsets pursuant to the provisions of Rule 507.A. Members and member firms using headsets
provided by a third-party must permit the third-party to provide the Market Regulation Department
direct access to recordings required to be made pursuant to the provisions of Rule 536.G.
Members and member firms are responsible for ensuring that their nonmember employees who
utilize headsets comply with all requirements set forth in this rule and are responsible for the content
of their nonmember employees’ headset communications.
506.B.
Use of Headsets
Nonmember employees wearing a headset may communicate order and fill information, as well as
market information that has been publicly exposed to the trading pit; however, such nonmember
employees may not communicate their personal opinions concerning the market or trading activity.
Headsets may be used to communicate between locations on the trading floor, and between the
trading floor and off-floor locations. Headsets may be used to accept, place or relay orders provided
that all applicable Exchange audit trail and recordkeeping requirements are met, unless such usage
is restricted in a particular pit by Exchange policy. However, nonmember customers may not placeorders directly to the pit, and floor brokers and their employees may not accept such orders, unless
81B

82B

© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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the customer’s clearing firm, in its sole discretion, has specifically authorized the customer to placeorders directly.

507.

ELECTRONIC DEVICES

12B

507.A.
General Provisions
The use of any electronic device on the trading floor is prohibited unless such device and/or usage
has been permitted by the Exchange. For purposes of this rule, the term “electronic device” shallmean any type of voice or data communications interface, including but not limited to a computer,headset, hand-held device, microphone or telephone. No Member (as defined in Rule 400) shallpermit others to use any electronic device unless such use has been permitted by the Exchange.
Members using a permitted electronic device on the trading floor for permissible business purposesmust retain any required audit trail data in accordance with applicable Exchange rules and CFTC
regulations.
507.B.
Terms and Conditions of Use
The Exchange may, in its sole discretion, impose restrictions on the use of any permitted electronic
device by any Member. The Exchange may limit, suspend or terminate any Member's right to use
any permitted electronic device at any time, without prior notice and without any liability to the
Exchange.
The Exchange shall have the right, at any time, to audit the use of any permitted electronic device
by any Member.
The Exchange accepts no responsibility for loss, theft or damage to any equipment permitted for use
by a Member on Exchange premises.
Electronic devices that are not issued by the Exchange must not interfere with any Exchange system.
507.C.
Electronic Surveillance
The Exchange may intercept and record any electronic communication received or sent from thetrading floor to ensure compliance with Exchange Rules. Exchange members, their employees, andall others who are granted access to the trading floor consent, as a condition of their membership,
employment, or access to the floor, to the interception, recording, and use of any such
communication.
507.D.
Personal Electronic Devices
Unless permitted pursuant to Section A. above, personal electronic devices including, but not limited
to, cell phones, personal digital assistants (PDAs) and other devices with email, instant messaging
or other similar capabilities may be used on the trading floor only for non-business purposes.
507.E.
Cameras and Video Equipment
Unless expressly permissioned by the Exchange, the use of any type of camera or video equipmenton the trading floor is prohibited.
83B

84B

85B

86B

87B

508.
13B

GIVING AND RECEIVING OF GRATUITIESA member, member firm, broker association or an employee of any of the foregoing may not give,
directly or indirectly, to any employee of another member, member firm or broker association any
gratuities or gifts with an aggregate market value in excess of $100 within any twelve-month period.
This rule applies notwithstanding any internal policy of an entity that allows for gifts in excess of $100.
The requirements of this rule apply to both the providers and the recipients of such gifts and gratuities.

509.
14B

ACCOUNTS OF MEMBERS AND MEMBER FIRMS
All trades initiated for the account of a member or member firm, or an account in which the member
or member firm has a proprietary interest, shall be disclosed on the books of a clearing member.

TRADING QUALIFICATIONS AND REGULATIONS
510.
15B

REQUIREMENTS FOR MEMBERS AND THEIR EMPLOYEES ON THE TRADINGFLOOR
All members and their employees on the trading floor shall satisfy all orientation requirements of the
Exchange. All members seeking to act as a Floor Broker, Floor Trader, or in any other capacity© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

Page 8 of 50

requiring registration pursuant to the Commodity Exchange Act, must be registered in accordancewith applicable CFTC regulations.
A member shall be prohibited from engaging in activities requiring registration under the Commodity
Exchange Act or from representing himself to be a registrant under the Commodity Exchange Act or
the representative or agent of any registrant if such member's Floor Broker or Floor Trader
registration is suspended by the CFTC or if the Exchange has suspended such member's privilege
to act as a Floor Broker or Floor Trader on the Exchange.
All members registered with the CFTC must report any changes to such status in accordance withapplicable CFTC regulations and must promptly notify the Shareholder Relations and Membership
Services Department of any such changes.

511.

QUALIFIED TRADERS AND BROKERS

16B

No member shall be permitted to execute a pit, spot call or allowable privately negotiated transaction
on the Exchange unless he is qualified to do so by a clearing member.
A member shall place all trades for his own account or any account which he controls, on the booksof his qualifying clearing member unless written authorization to the contrary from said clearing
member has been filed with the Shareholder Relations and Membership Services Department.
Regardless of such authorization, a member in a deficit position with any clearing member shall place
trades only through his qualifying clearing member. Any non-qualifying clearing member that carriesa member's account in a deficit position shall promptly notify the clearing member that is qualifying
such member.
A member who believes his qualifying clearing member is unreasonably withholding a releasenecessary to permit the member to be qualified by a different clearing member may request a hearing
before a Panel of the Business Conduct Committee (“Panel”) pursuant to the applicable provisionsof Rule 408. The Panel may, in its sole discretion, remand a dispute concerning the validity of asigned non-compete agreement between the parties to arbitration pursuant to Rule 600.A. Either
party may petition the arbitration chairman for expedited handling of the matter pursuant to Rule 613.
The Panel may assess attorneys’ fees and the administrative costs of the proceeding against one orboth of the parties if it determines that a claim or defense was frivolous or filed in bad faith.
511.A.
Floor Trading
A clearing member may, without prior notice, revoke a member’s authorization to trade by written
revocation filed with the Shareholder Relations and Membership Services Department. Such
revocation shall be effective and the member's qualification to trade shall terminate when notice ofthe disqualification is posted on the Exchange floor. A member shall not appear upon the floor of the
Exchange until he has been requalified. A member who has been disqualified shall promptly return
his membership badge to the Shareholder Relations and Membership Services Department.
511.B.
Globex Trading
Unless otherwise specified by a member's qualifying clearing member, a member suspended fromentering orders through Globex shall not be disqualified from pit trading.
In the case of a member who has Globex access guaranteed by a clearing member other than his
qualifying clearing member, the qualifying clearing member may terminate the member's ability toplace orders through Globex by notifying the clearing member providing the member access to
Globex. The clearing member providing the access to Globex will be responsible for ensuring thatthe member does not place orders through Globex.
8B

512.
17B

REPORTING INFRACTIONS
512.A.
GeneralAll data, records and other information required by the rules to be reported to the Exchange or the
Clearing House, as applicable, must be submitted in an accurate, complete and timely manner.
512.B.
Sanctions
1. Except as otherwise provided in Rule 536, the Chief Regulatory Officer or his designee shallhave the authority to impose summary fines on parties who have consented to the jurisdiction of the
Exchange. Summary fines shall not be less than $1,000 per offense and shall not exceed $5,000 per
offense for individuals or $10,000 per offense for firms for the inaccurate, incomplete or untimely
submission of data, records or information required to be submitted to the Exchange or the Clearing
House.

© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

Page 9 of 50

2. Individuals and firms shall have 15 days following receipt of the notice of a summary fine topresent evidence to the Market Regulation Department that the fine should be rescinded or reduced.
Absent the submission of such evidence within the designated time period, the fine shall be deemed
final and may not be appealed.
512.C.
Hearings and Appeals
If the Chief Regulatory Officer or his designee determines that evidence submitted by an individual
or firm pursuant to Section B.2. is insufficient to support the requested rescission or reduction of thefine, the individual or firm may, within 10 days of the decision, file a written appeal with the Market
Regulation Department. A written appeal that fails to specify the grounds for the appeal and thespecific error or impropriety of the original decision shall be dismissed. The appeal shall be heard
by a Panel of the Business Conduct Committee (“BCC Panel”) whose decision shall be final. The
appellant shall be entitled to be represented by counsel, appear personally before the BCC Paneland present evidence that he may have in support of his appeal. The BCC Panel shall not set aside,modify or amend the appealed decision unless it determines, by a majority vote, that the decisionwas:
1. Arbitrary, capricious, or an abuse of the Exchange staff’s discretion;
2. In excess of the Exchange staff’s authority or jurisdiction; or
3. Based on a clearly erroneous application of Exchange rules.
Notwithstanding the provisions of Sections B.1. and B.2. above, the Market Regulation Department
may, at any time, refer matters that it deems egregious to the Chief Regulatory Officer forconsideration of charges.

513.

CONDUCT, APPAREL AND BADGES

18B

513.A.
GeneralMembers and their employees are expected to conduct themselves on Exchange premises with
dignity and integrity in order to maintain a safe workplace and the efficiency and good name of the
Exchange. Members and their employees shall refrain from excessive speed in moving about thetrading floors, and shall be respectful of all others on Exchange premises and shall abide by
Exchange policy concerning access, conduct, and appearance. Members and their employees, whileon the trading floors, shall be professionally attired in accordance with Exchange policy, and shallwear jackets bearing identification badges issued by the Exchange. Members and their employees
not professionally attired in accordance with Exchange policy may be barred or removed from thetrading floors. Refreshments and smoking are forbidden on the trading floors at all times.
513.B.
Sanctions
1. Designated Exchange officials may impose fines on members or their employees for violationsof the Exchange policy concerning access, conduct, and appearance. Fines imposed pursuant
to Rule 513.B.1. are final and may not be appealed.
2. A fourth violation of the Exchange policy concerning access, conduct, and appearance within arolling 18-month period will be subject to a $1,000 fine.
3. A fifth or subsequent violation of the Exchange policy concerning access, conduct, andappearance within a rolling 18-month period will be referred to a summary proceeding before aPanel of the Floor Conduct Committee. The Panel may impose a fine not to exceed $5,000 per
violation.
4. Notwithstanding any other provision in this Rule, the Chief Regulatory Officer shall have theauthority to impose a fine not to exceed $5,000 per offense on members and their employees
for egregious violations of Rule 513.A.
5. The Market Regulation Department, at its discretion, may refer any alleged violation of Rule 513
to the Chief Regulatory Officer for consideration of charges.
513.C.
Hearings and Appeals
An individual fined pursuant to Rule 513.B.2., 3. or 4. may, within 10 days of the decision, file a written
appeal with the Market Regulation Department. A written appeal that fails to specify the grounds forthe appeal and the specific error or impropriety of the original decision shall be dismissed. The
appeal shall be heard by a Panel of the Business Conduct Committee (“BCC Panel”) whose decision
shall be final. The appellant shall be entitled to be represented by counsel, appear personally before
the BCC Panel and present evidence that he may have in support of his appeal. The BCC Panelshall not set aside, modify or amend the appealed decision unless it determines, by majority vote,
89B

90B

91B

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Page 10 of 50

that the decision was:
1. Arbitrary, capricious, or an abuse of the Panel’s or Exchange staff’s discretion;
2. In excess of the Panel’s or Exchange staff’s authority or jurisdiction; or
3. Based on a clearly erroneous application of Exchange rules.

514.

TRADING INFRACTIONS

19B

A written complaint concerning a trading infraction pursuant to Rule 514.A. may be initiated bymembers, member firms, trading floor employees of members or member firms or staff of the
Exchange. Charges shall be issued and hearings shall be conducted for violations of this rule inaccordance with Rule 409.
514.A.
Definition
The following shall constitute trading infractions:
1. a bid or offer out of line with the market;
2. a bid or offer which tends to confuse the other traders;
3. a trade through the existing bid or offer;
4. failure to confirm a transaction;
5. failure of a buyer and seller to properly notify the pit reporter of transaction prices in accordancewith Rule 528 and/or failure to ascertain that such prices are properly recorded;
6. use of profane, obscene or unbusinesslike language on the trading floor;
7. use of undue force while on, entering or leaving the trading floor;
8. conduct which tends to confuse, distract, abuse or intimidate any Exchange employee;
9. conduct of an unbusinesslike nature;
10. failure to defer to a member who has clearly turned the market;
11. failure to indicate a quantity on a bid or offer; and12. disseminating false, misleading or inaccurate quotes.
92B

93B

514.B.
Floor Conduct Committee Fining Authority
A Panel of the Floor Conduct Committee that finds a member or his employee guilty of violating Rule
514 may impose a fine of up to $10,000 per offense on such member or employee, except that anegregious violation of Rule 514.A.6., 7., 8. or 9. may result in a fine of up to $20,000. Notwithstanding
the above, the total fine levied by a Panel against a respondent may not exceed $20,000 based on
the single issuance of charges.
If an individual is found guilty of three violations of Rule 514.A. within a rolling one-year period, or
any three violations of Rule 514.A.6., 7., 8., and/or 9., within a rolling five-year period, any subsequent
alleged violation under Part A. of this rule within such period shall be reviewed by the Market
Regulation Department to determine whether to forward the alleged violation to a Panel of the Floor
Conduct Committee for adjudication or to investigate and refer the matter to the Chief Regulatory
Officer for review. Notwithstanding the above, the Market Regulation Department may, at any time,refer matters that it deems egregious to the Chief Regulatory Officer.

515.

REGISTRATION AND IDENTIFICATION OF BROKER ASSOCIATIONS

20B

515.A.
Definitions
1. Floor Brokerage Activity - The execution or pre-execution handling of orders on the trading floor.
2. Broker Association - A broker association shall include the following associations between two
or more members with trading floor access privileges, at least one of whom is engaged in floor
brokerage activity:
a. Revenue Sharing Association: Associations between members who:i. share profits or losses associated with their brokerage and/or error account activity;
and/orii. have an employer and employee relationship which relates to floor brokerage activity;
b. Non-Revenue Sharing Association: Associations between members who:
i. regularly share a deck of orders; and/or
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ii. share employee salary expenses.
c. Any other group or combination deemed by the Exchange to be a broker association.
3. Principal of a Revenue Sharing Association – Each individual who has formal or de facto control
over the affairs of, or has a ten percent or greater ownership interest in, a Revenue Sharing
Association not owned by a clearing member firm.
4. Spokesperson of a Non-Revenue Sharing Association and Revenue Sharing Associations
owned by a clearing member firm – An individual authorized to represent a Non-Revenue
Sharing Association or Clearing Firm owned Revenue Sharing Association in connection with its
registration obligations set forth in Section B.
5. Investor – An individual who has a direct beneficial interest in a Revenue Sharing Association
but is not a principal as defined in A.3. above.
515.B.
Registration Requirements
1. A member of a broker association shall not handle or execute an order unless that association
has registered with the Exchange.
2. Members or Member Firms must have majority ownership interest in any broker association.
3. Principals involved in floor brokerage activity must have trading privileges in the membershipdivision required for access to the products handled by the members of the association.
Principals who are not involved in floor brokerage activity must own a membership in themembership division required for access to the products handled by the members of theassociation. Notwithstanding the above, principals not regularly involved in floor brokerage
activity may hold a membership in any division in circumstances where the association is owned
by a Member Firm and such Member Firm owns a membership in the membership division
required for access to the products handled by the members of the association.
4. No registered broker association or member thereof shall permit a party to have any direct orindirect profit or ownership interest in a broker association unless such party is registered in theassociation in accordance with this rule.
5. Registration shall be accomplished by filing the appropriate registration forms with the Market
Regulation Department.
6. It shall be the responsibility of the broker association and its principals or spokespersons toensure that the association is properly registered. Any additions, deletions or other changes tothe information already reported must be provided to the Market Regulation Department within
two business days after the event giving rise to such changes.
7.
The Exchange may request any additional
information from a broker association as deemed appropriate.
515.C.
Prohibition on Sharing of Personal Trading Profits
Registrants in a broker association may not share profits or losses associated with their personal
trading activity by direct or indirect means, except for profits and losses related to brokerage errors.
515.D.
Supervision
Each principal of a Revenue Sharing Association must diligently supervise the association’s member
registrants and non-member employees and may be held directly liable for violations of any rule of
the Exchange by such registrants and employees. Regardless of whether the principal is held
responsible for the act or acts constituting the violation, each principal is jointly liable for the paymentof any fines assessed against another principal, registrant or employee of the association provided
that the violation occurred while that person was functioning in his capacity with the association.
515.E.
Trading Restrictions
The Exchange may impose limits on the percentage of personal trading and/or brokerage volume
that members of a broker association may execute with one another. Violations of such restrictions
will result in summary action according to the following schedule on a rolling 12 month period:First Occurrence
Letter of Warning
Second Occurrence$5,000 fine
Subsequent Occurrence$10,000 fine
The Exchange may restrict a member of a Revenue Sharing Association from trading for any accountsuch member owns, controls or in which such member has a financial interest opposite othermembers of the association executing orders. Violation of such restrictions will result in summary
95B

96B

97B

98B

9B

10B

10B

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Page 12 of 50

action according to the following schedule on a rolling 24 month period:First Occurrence
Letter of Warning
Second Occurrence$500 fineThird Occurrence$1,000 fine
Subsequent Occurrence$5,000 fine
Actions taken pursuant to this section are final and may not be appealed; however members will
have 15 days following receipt of notification of the action to present evidence to the Market
Regulation Department that administrative, clerical or other errors caused the apparent rule violation.
Notwithstanding the provisions of this section, the Market Regulation Department may, at any time,refer matters that it deems egregious to the Chief Regulatory Officer for consideration of charges.

516.
21B

ERROR ACCOUNTS
Each member who acts as a Floor Broker must maintain a designated error account with his
qualifying clearing member into which he places brokerage errors. This requirement shall not apply
to a Floor Broker who initiates trades or enters orders solely on behalf of a member firm’s proprietaryaccount.
Each qualifying clearing member which carries an error account agrees, without qualification, toaccept and clear the broker’s trades involving brokerage errors.

517.-519.
2B[RESERVED]
2B

TRADING PRACTICES
520.
23B

TRADING CONFINED TO EXCHANGE FACILITIESAll trading in Exchange products must occur on or through Exchange facilities and in accordancewith Exchange rules.

521.
24B

REQUIREMENTS FOR OPEN OUTCRY TRADES
In open outcry trading, bidding and offering practices must at all times be conducive to the competitive
execution of transactions. All open outcry transactions, including spread and combinationtransactions, shall be made openly and competitively in the pit designated for the trading of theparticular transaction. No bid or offer shall be specified for acceptance by a particular trader.
Transactions may take place only at the best price available in the open outcry market at the time
the trade occurs.
It shall be the duty of both traders to confirm their trades as to the price, quantity, commodity, contract
month, respective clearing members and, for options, strike price, put or call and expiration month.
Confirmation shall take place as soon as possible, but in no event more than 15 minutes after the
trade.

522.
25B

ACCEPTANCE OF BIDS AND OFFERS
In open outcry and electronic trading, while outstanding, all or any part of any bid or offer is subject
to immediate acceptance by any trader. Members are required to honor all bids or offers which havenot been withdrawn from the market. The price at which a trade is executed shall be binding, unlesssuch trade is cancelled by Exchange officials in accordance with Exchange rules.

26B

523.
27B

ALL-OR-NONE TRANSACTIONSThe Exchange shall determine the minimum thresholds for and the commodities in which All-or-Nonetransactions shall be permitted. The following shall govern All-or-None trading:
1. A member may request an All-or-None bid and/or offer for a specified quantity at or in excess of
the applicable minimum threshold. Such request shall be made in the pit designated for the
trading of the particular transaction.
2. A member may respond by quoting an All-or-None bid or offer price. A bid or offer in responseto an All-or-None request shall be made only when it is the best bid or offer in response to such
request, but such price need not be in line with the bids and offers currently being quoted in theregular market.
3. A member shall not execute any order by means of an All-or-None transaction unless the order© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

Page 13 of 50

4.

5.
6.

524.
28B

includes specific instructions to execute an All-or-None transaction or the All-or-None bid or offer
is the best price available to satisfy the terms of the order.
An All-or-None bid or offer may be accepted by one or more members provided that the entire
quantity of the All-or-None order is executed at a single price and that each counterparty to theorder accepts a quantity at or in excess of the designated minimum counterparty
threshold. Each order executed opposite an All-or-None order must be for a quantity that meetsor exceeds the minimum counterparty threshold. Separate orders may not be bunched to meetthe minimum counterparty threshold.
All-or-None transactions shall not set off conditional orders (e.g., Stop Orders and MIT Orders)or otherwise affect orders in the regular market.
All-or-None transactions must be reported to a designated Exchange official who shall recordand publish the quantity and prices separately from reports of transactions in the regular market.
The brokers executing All-or-None transactions must maintain a record of said transaction inaccordance with Rule 536.

TRADING AT SETTLEMENT (“TAS”), BASIS TRADE AT INDEX CLOSE (“BTIC”),
BASIS TRADE AT CASH OPEN (“TACO”) AND TRADE MARKER AT CLOSE(“TMAC”) TRANSACTIONSThe Exchange shall determine the products, contract months and time periods during which TAS,
BTIC, TACO, and TMAC transactions shall be permitted. Specific products, contract months andspreads eligible for pricing as TAS, BTIC, TACO, or TMAC transactions are set forth in the TAS,
BTIC, TACO, and TMAC Table (“Table”) at the end of Chapter 5.
524.A.
Trading at Settlement (“TAS”) Transactions
The following shall govern TAS transactions:
1. A TAS order may be entered on Globex at any time the applicable contract is available for TAS
trading on Globex and during such TAS-eligible contract’s prescribed pre-open time period. The
initiation of any TAS order on Globex outside these time periods is prohibited.
2. Unless otherwise specified in the Table, a TAS-eligible product and contract month may be
executed as a block trade pursuant to the requirements of Rule 526 or as an Exchange of
Futures for Physical (“EFP”) or Exchange of Futures for Risk (“EFR”) transaction pursuant to therequirements of Rule 538.
3. Unless otherwise specified by the Exchange, a TAS transaction may be executed at the current
day’s settlement price or at any valid price increment four ticks higher or lower than thesettlement price.
524.B.
Basis Trade at Index Close (“BTIC”) Transactions
A Basis Trade at Index Close (“BTIC”) transaction is an Exchange futures transaction which is priced
with reference to the closing level of such futures contract’s underlying cash Index, or the closing
level of a related index as described in the applicable product chapter, on a particular trading day(the “Basis”). The following shall govern BTIC transactions:
1. A BTIC order may be entered on Globex at any time the applicable futures contract is available
for BTIC trading on Globex and during such BTIC-eligible futures contract’s prescribed pre-opentime period. The initiation of any BTIC order on Globex outside these time periods is prohibited.
2. Unless otherwise specified in the Table, a BTIC-eligible product and contract month may be
executed as a block trade pursuant to the requirements of Rule 526, except that a BTIC blocktrade cannot be executed on the last day of trading in an expiring BTIC-eligible futures contract.
3. The Basis established in any BTIC transaction must be stated in admissible price increments forthe applicable futures contract as set forth in the applicable product chapter. The assigned
futures price corresponding to such BTIC transaction shall be the closing level of the applicable
cash Index, or the closing level of a related index as described in the applicable product chapter,for that trading day adjusted by the Basis established in such BTIC transaction. For any BTICeligible futures contract, the magnitude of the Basis in a BTIC block trade must be fair andreasonable in light of factors including, but not limited to, financing rates, expected dividend
income, and time remaining until the underlying futures contract expiration. A BTIC futurestransaction may result in an assigned futures price outside of applicable daily price limits.
The assigned futures price is deemed final when determined by the Exchange, absent an index
price correction by the index provider. If the closing level of a cash Index, or the closing level of© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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a related index as described in the applicable product chapter, is corrected by the applicable
cash Index provider prior to 4:00 p.m. CT on the following Business Day, the assigned futures
price corresponding to such BTIC transaction shall be amended using the corrected closing levelof the applicable cash Index, or the closing level of a related index as described in the applicableproduct chapter, adjusted by the Basis established in such BTIC transaction, and the assigned
futures price shall be deemed final at that time.
4. Additional product-specific BTIC provisions, including those relating to disruptions in the
publication of an index and the applicable index closing times are set forth in the applicableproduct chapter in the Rulebook.
524.C.
Basis Trade at Cash Open (“TACO”) Transactions
A Basis Trade at Cash Open (“TACO”) transaction is an Exchange futures transaction that is priced
with reference to the next following regularly scheduled special opening quotation (“SOQ”) of such
futures contract’s underlying cash Index (the “Basis”). The following shall govern TACO transactions:
1. A TACO order may be entered on Globex at any time the applicable contract is available for
TACO trading on Globex and during such TACO-eligible contract’s prescribed pre-open time
period. The initiation of any TACO order on Globex outside these time periods is prohibited.
2. Unless otherwise specified in the Table, a TACO-eligible product and contract month may be
executed as a block trade pursuant to the requirements of Rule 526, provided that for any
expiring TACO-eligible contract, a TACO block trade is prohibited with reference to suchcontract’s cash Index SOQ for the last day of trading in such contract.
3. The Basis established in any TACO transaction must be stated in admissible price increments
for the applicable futures contract as set forth in the applicable product chapter. The assigned
futures price corresponding to such TACO transaction shall be the next following regularlyscheduled SOQ of the applicable cash Index adjusted by the Basis established in such TACO
transaction.
For any TACO-eligible futures contract, the magnitude of the Basis in a TACO block trade mustbe fair and reasonable in light of factors including, but not limited to, financing rates, expected
dividend income, and time remaining until the underlying futures contract expiration. A TACO
futures transaction may result in an assigned futures price outside of applicable daily price limits.
4. In the event of a disruption in the primary listing exchange for a given cash Index (or a disruption
in the applicable national bourse or market in the case of a given non-US cash Index) such thatthe administrator of such cash Index is unable to produce a regularly scheduled SOQ, all pending
and executed TACO transactions in the corresponding futures contract shall be cancelled by the
Exchange. Such disruption shall be declared by the Exchange in its sole discretion.
5. Additional product-specific TACO requirements are set forth in the applicable product chapter inthe Rulebook.
524.D. Trade Marker at Close (“TMAC”) Transactions
The following shall govern TMAC transactions:
1. A TMAC order may be entered on Globex at any time the applicable contract is available for
TMAC
trading on Globex and during such TMAC-eligible contract’s prescribed pre-open time period. The
initiation of any TMAC order on Globex outside these time periods is prohibited.
2. Unless otherwise specified in the Table, a TMAC-eligible product and contract month may be
executed as a block trade pursuant to the requirements of Rule 526 or as an Exchange of Futures
for Physical (“EFP”) or Exchange of Futures for Risk (“EFR”) transaction pursuant to therequirements of Rule 538.
3.
Unless otherwise specified by the Exchange, a TMAC transaction may be executed at the current
day’s applicable marker price or at any valid price increment four ticks higher or lower than theapplicable marker price.

[RESERVED]

526.

BLOCK TRADES

29B

525.

The Exchange shall designate the products in which block trades shall be permitted and determine
the minimum quantity thresholds for such transactions. The following shall govern block trades:
A. A block trade must be for a quantity that is at or in excess of the applicable minimum threshold.

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Orders may not be aggregated in order to achieve the minimum transaction size, except by thoseentities described in Sections I. and J.
B. Each party to a block trade must be an Eligible Contract Participant as that term is defined in
Section 1a(18) of the Commodity Exchange Act.
C. A member shall not execute any order by means of a block trade for a customer unless suchcustomer has specified that the order be executed as a block trade.
D. The price at which a block trade is executed must be fair and reasonable in light of (i) the sizeof the block trade, (ii) the prices and sizes of other transactions in the same contract at therelevant time, (iii) the prices and sizes of transactions in other relevant markets, including without
limitation the underlying cash market or related futures markets, at the relevant time, and (iv) the
circumstances of the markets or the parties to the block trade.
E. Block trades shall not set off conditional orders (e.g., Stop Orders and MIT Orders) or otherwise
affect orders in the regular market.
F. Unless otherwise agreed to by the principal counterparties to the block trade, the seller, or, inthe case of a brokered transaction, the broker handling the block trade, must ensure that eachblock trade is reported to the Exchange within the time period and in the manner specified by
the Exchange. The report must include the contract, contract month, price, quantity of thetransaction, the respective clearing members, the time of execution, and, for options, strike price,
put or call and expiration month. The Exchange shall promptly publish such information
separately from the reports of transactions in the regular market.
G. Block trades must be reported to the Clearing House in accordance with an approved reporting
method.
H. Clearing members and members involved in the execution of block trades must maintain arecord of the transaction in accordance with Rule 536.
I. A commodity trading advisor ("CTA") registered or exempt from registration under the Act,
including, without limitation, any investment adviser registered or exempt from registration underthe Investment Advisers Act of 1940, shall be the applicable entity for purposes of Sections A.,
B., C., and D., provided such advisors have total assets under management exceeding $25
million and the block trade is suitable for the customers of such advisors.
J. A foreign Person performing a similar role or function to a CTA or investment adviser as
described in Section I, and subject as such to foreign regulation, shall be the applicable entity
for purposes of Sections A., B., C., and D., provided such Persons have total assets undermanagement exceeding $25 million and the block trade is suitable for the customers of such
Persons.

527.

OUTTRADES, ERRORS AND MISHANDLING OF ORDERS

30B

527.A.
Outtrades Discovered During a Regular Trading Hours Trading Session
It shall be the duty of a member discovering an outtrade during a Regular Trading Hours session to
immediately notify the opposite trader. Thereafter, if the matter cannot be resolved between theparties, they shall immediately determine who will cover the trade and the trade shall immediately becovered.
527.B.
Outtrades Discovered After a Regular Trading Hours Trading Session
A clearing member that is unable with diligent effort to resolve an outtrade with another clearing
member shall notify the member who executed the trade. Such notice shall be given prior to thefollowing day’s Regular Trading Hours session in sufficient time to allow the member to makeprovisions for the resolution of the outtrade.
Outtrades discovered after a Regular Trading Hours session shall be resolved between the parties
to the outtrade as provided in this rule, no later than the opening of trading of the next Regular Trading
Hours session.
527.C.
Outtrades Resolution
To resolve an outtrade, the parties shall attempt to agree upon: (1) the reconciliation of any
discrepancy in the terms of the trade, (2) which party will cover the trade and the method for covering
the trade, if applicable, and (3) the apportionment of the financial results of the outtrade. In the eventthe parties are unable to agree on the apportionment of the financial results, the parties mustnevertheless immediately reconcile the outtrade.
102B

103B

104B

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The price at the time of the open of the next Regular Trading Hours session shall fix the limit ofliability as a result of the outtrade. Regardless of the ultimate determination of financial responsibility
for the outtrade, a party who unreasonably refuses to cover the outtrade via an appropriate alternate
market may be liable to the other party for the difference between the price at which the outtrade
could have been covered in the alternate market and the price at the time of the open of the next
Regular Trading Hours session.
Outtrades shall be resolved in accordance with the procedures below:
1. Straight Out Customer Outtrades
If a floor broker discovers that all or some portion of a customer order was executed but cannot
be cleared, the broker shall either 1) re-execute the order in the market and adjust the customer
by check if the re-execution price is worse than the original execution price, or, if the re-execution
price is better than the original execution price, the customer is entitled to the better price or 2)
assign the opposite side of the portion that cannot be cleared to his error account and assign afill to the customer at the execution price. The floor broker shall not liquidate the assigned
position until at least ten minutes have elapsed after the execution of the order giving rise to theouttrade and the bracket period in which the outtrade occurred has ended; however, theseliquidation restrictions shall not apply to a liquidation during the post close session. Any profits
or losses resulting from the liquidation of the assigned position belong to the floor broker andany such profits may be retained or disbursed at his discretion.
A floor broker who assigns the opposite side of an order pursuant to this rule shall: 1) clearly
identify all such transactions by appropriate designation; 2) submit such trade information to his
qualifying clearing member in sufficient time to enable the clearing member to submit the trade
for the next intra-day reconciliation; 3) document in writing the circumstances surrounding any
such transaction and promptly provide such documentation to the Market Regulation
Department upon request; and 4) identify the subsequent liquidation of the assigned trade on
the floor broker’s trading card or other document.
2. Price Outtrades
When an outtrade exists due to a price discrepancy, members making the trade may choose toresolve the discrepancy by electing either of the two prices in question, if they agree that thetrade was executed at that price.
If an outtrade involves a price discrepancy between a local and a broker, and the members
cannot agree on the price of execution, the price recorded by the broker shall be used to clear
the trade.
If an outtrade between locals or an outtrade between brokers involves a price discrepancy, andthe members cannot agree on the price of execution, the buyer’s price shall be used to clear the
trade.
3. Quantity Outtrades
When an outtrade exists due to a quantity discrepancy, members making the trade may choose
to resolve the discrepancy by electing either of the two quantities in question, if they agree thatthe trade was executed for that quantity.
If an outtrade between locals involves a quantity discrepancy and the members cannot agree on
the quantity that was executed, the higher quantity shall be used to clear the trade.
A broker may assign the opposite side of any quantity which he believes that he has executed,
but which cannot be cleared, to his error account, pursuant to Section 1 above.
4. Bona Fide Contract Month, Strike, Put vs. Call and Side of Market (Buy vs. Buy or Sell vs. Sell)
Outtrades
When an outtrade exists due to a contract month, strike price, side of market, or put/call
discrepancy, and any party who executed a customer order believes that the order was executedin accordance with its instructions, the outtrade may be resolved in any one of the following
ways:
a. The trade may be busted. If a broker re-executes his order, any losses incurred by thecustomer as a result of the delay in execution must be adjusted by check. If the order is
executed at a more favorable price, the customer is entitled to the better price.
b. The members making the trade(s) may agree to clear either trade or both trades inaccordance with the members’ recorded trade data.

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c.

A broker may assign the opposite side of his order to his error account, pursuant to Section
1. above, and he may agree to the clearing of the transaction according to the terms of theother member’s recorded trade data.
d. If both members involved in the outtrade are brokers, they may each assign the opposite
side of their respective orders to their error accounts pursuant to Section 1. above.
A customer shall not be entitled to any portion of any profits realized by a local who was on the
opposite side of an outtrade between the local and the customer’s broker, as a result of thelocal’s liquidation of his position. Such profits belong to the local, and may be retained or
disbursed at his discretion. If the local chooses to disburse any portion of such profits to thebroker, and the broker’s customer has received a fill in accordance with the broker’s recorded
trade data, the broker is not obligated to offer such profits to his customer.
Nothing herein shall in any way limit a member's right to submit an outtrade to Exchange
arbitration if the outtrade cannot be resolved by agreement.
527.D.
Errors and Mishandling of Orders
If a broker overbuys or oversells for an order, the customer is not entitled to any of the quantity
executed in excess of the order quantity. A position that has been established as a result of anerroneous execution or mishandling of an order must be placed in the error account of the broker orfirm responsible for the error or order mishandling. Any profits resulting from the liquidation of trades
placed in a broker’s or firm’s error account belong to the relevant broker or firm, and any such profits
may be retained or disbursed at the broker’s or firm’s discretion.
1. Unfilled or Underfilled Orders
If a broker fails to execute an order or underbuys or undersells for an order, the broker shall do
one of the following:a. Execute the order or the remainder of the order in the market and adjust the customer bycheck if the customer is filled at a price less favorable than that to which he was entitled dueto the broker’s error or mishandling of the order. If the order is filled at a more favorable
price, the customer is entitled to the better price.
b. Execute the order or the remainder of the order in the market. If the order, or the remainderof the order, is filled at a worse price than that to which the customer was entitled but for theerror or mishandling, the broker may allocate the fill to his error account, pursuant to Section
C.1. above, provide the customer a fill at the price to which the customer was entitled, andplace the opposite side of the customer fill into his error account. If the order is filled at amore favorable price, the customer is entitled to the better price.
2. Wrong Contract Month, Wrong Strike, or Wrong Commodity Executions
When an order has been executed in the wrong contract month, wrong strike price, or wrong
commodity, and the erroneous transaction has been placed in the relevant broker’s or firm’s
error account, the error may be corrected by one of the following:a. Execution of the order in accordance with its terms, with an adjustment to the customer bycheck if the order is executed at a worse price as a result of the error or mishandling of theorder.
b. Execution of a spread or combination transaction to execute the order and liquidate theposition arising from the initial erroneous execution of the order, whereby one leg of the
spread or combination transaction represents the correct execution of the order and theother leg offsets the erroneous position in the broker’s or firm’s error account. The broker
or firm must clearly identify such transactions by appropriate designation, clearly document
in writing the circumstances surrounding the nature of the error and promptly provide such
documentation to the Market Regulation Department upon request.
3. Wrong Side of Market Executions
When an order has been executed on the wrong side of the market and the erroneous execution
has been placed in the relevant broker’s or firm’s error account, the order shall be executed inaccordance with its terms, with an adjustment to the customer by check if the order is executed
at a worse price as a result of the error or mishandling of the order.
105B

528.
31B

PRICE REPORTING
Parties to a pit transaction shall properly notify the designated Exchange official of the price at which
trades have been consummated. Both parties to a pit trade are required to ensure that such price is© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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properly posted.
Whenever a member makes a trade with another member and such trade constitutes a priceinfraction, he shall 1) immediately break the trade; or 2) satisfy all bids or offers which were adversely
affected; or 3) adjust the price of the trade to the price which existed when the price infraction
occurred, provided that both parties agree to adjust the price and the terms of any affected orders
are satisfied.

529.

WITHHOLDING ORDERS PROHIBITED

32B

A Member (as defined in Rule 400), or any person entering orders on the Globex platform, shall notwithhold or withdraw from the market any order, or any part of an order, for the benefit of any person
other than the person placing the order.

530.

PRIORITY OF CUSTOMERS' ORDERS

3B

A member shall not buy (sell) a futures contract, buy (sell) a call option or sell (buy) a put option for
his own account, an account in which he has a direct or indirect financial interest, or an account overwhich he has discretionary trading authority when he is in possession of an executable order for
another person to buy (sell) a futures contract, buy (sell) a call option or sell (buy) a put option in thesame product, regardless of the venue of execution. All contract months in a given futures productand all options on the futures product, in addition to any corresponding alternative sized (mini or
micro) futures or options contracts on a given product, shall be considered the same product for the
purposes of this rule.
The foregoing shall not apply to DRT orders provided that the customer has previously consented inwriting and evidence of such general consent is indicated on the order with the “WP” (with permission)
designation. In the case of a Floor Broker holding a discretionary order for an account described inRule 547, a "WP" designation on the order shall constitute sufficient evidence of prior consent.
No person shall enter an order into the Globex platform for his own account, an account in which hehas a direct or indirect financial interest or an account over which he has discretionary trading
authority, including, without limitation, an order allowing discretion as to time and price, when such
person is in possession of any order for another person that the Globex platform is capable ofaccepting.

531.

TRADING AGAINST CUSTOMERS' ORDERS PROHIBITED

34B

531.A.
General Prohibition
No person in possession of a customer order shall knowingly take, directly or indirectly, the opposite
side of such order for his own account, an account in which he has a direct or indirect financial
interest, or an account over which he has discretionary trading authority.
531.B.
Exceptions
The foregoing restriction shall not apply to the following:
1. Transactions executed in accordance with Rule 527 to resolve bona fide outtrades or errors;
2. Transactions executed pursuant to Rule 538;
3. Block trades executed pursuant to Rule 526;
4. On the Globex platform, a person may knowingly trade against his customer order for his own
account, an account in which he has a direct or indirect financial interest, an account over which
he has discretionary trading authority, or a proprietary account of his employer, only if thecustomer order has been entered immediately upon receipt and has first been exposed on the
Globex platform for a minimum of 5 seconds in the case of futures orders or for a minimum of
15 seconds in the case of options orders; and5. If the transaction was pit traded, a person may knowingly trade against his customer order for
his own account, an account in which he has a direct or indirect financial interest, an accountover which he has discretionary trading authority, or a proprietary account of his employer, only
if: (i) the customer has consented in writing to waive the application of Rule 531.A. no more than
12 months prior to the transaction; (ii) the member complies with the requirements set forth inRule 533 (iii) the member clearly identifies, by appropriate descriptive words, all suchtransactions, and (iv) the member ensures that it is reported to Exchange price reporting staff
for entry into the Exchange Price Reporting System as a cross trade.
106B

107B

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532.
35B

IMPROPER USE OR DISCLOSURE OF NON-PUBLIC INFORMATION PROHIBITED
Except as permitted by other Exchange rules, including, but not limited to, Rules 526, 538 and 539,
no Person shall:a. Directly or indirectly trade (or enter, cancel, or modify an order) on the basis of material nonpublic information when he knows or reasonably should have known the information was
obtained or disclosed through fraud, deception, or in violation of a pre-existing duty
(established by law, rule, agreement, understanding, or some other source);
b. Disclose material non-public information when he knows or reasonably should have known
the disclosure of the information would violate a pre-existing duty (established by law, rule,agreement, understanding, or some other source) owed to another, except when thedisclosure is made to an Exchange official, a permitted government official, or is requiredby law.
c. Solicit or induce another person to disclose material non-public information.
The mere statement of opinions or general market conditions does not constitute a violation of thisrule. An order for execution is material and not public information until it has been exposed to themarket.

533.
36B

SIMULTANEOUS BUY AND SELL ORDERS FOR DIFFERENT BENEFICIAL OWNERS
A member who is in possession of both buy and sell orders for different beneficial owners for thesame product and expiration month, and, for a put or call option, the same strike price, may executesuch orders for and directly between such beneficial owners provided that in pit trading, a member
executing such orders shall first bid and offer by open outcry three times at the same price, stating
the number of contracts, and, thereafter, if neither the bid nor the offer is accepted, the orders may
be matched in the presence, and with the approval, of a designated Exchange official.
The member making such transactions shall, by appropriate descriptive words or symbols, clearly
identify all such transactions on his trading card or other similar record made at the time of theexecution. The member executing such trade must ensure that it is reported to Exchange pricereporting staff for entry into the Exchange Price Reporting System. Failure to identify the transaction
to Exchange price reporting staff as a cross trade shall constitute a violation of this rule.
On the Globex platform, opposite orders for different beneficial owners that are simultaneously
placed by a party with discretion over both accounts may be entered into the Globex platform
provided that one order is exposed for a minimum of 5 seconds. An order allowing for price and/ortime discretion, if not entered immediately upon receipt, may be knowingly entered opposite anotherorder entered by the same firm only if this other order has been entered immediately upon receipt
and has been exposed on the Globex platform for a minimum of 5 seconds.

534.
37B

WASH TRADES PROHIBITED
No person shall place or accept buy and sell orders in the same product and expiration month, and,for a put or call option, the same strike price, where the person knows or reasonably should knowthat the purpose of the orders is to avoid taking a bona fide market position exposed to market risk
(transactions commonly known or referred to as wash sales). Buy and sell orders for different
accounts with common beneficial ownership that are entered with the intent to negate market risk or
price competition shall also be deemed to violate the prohibition on wash trades. Additionally, no
person shall knowingly execute or accommodate the execution of such orders by direct or indirectmeans.

535.
38B

RESPONSIBILITY OF FLOOR TRADERS AND FLOOR BROKERS
Every Floor Trader and Floor Broker shall assist his clearing member in the clearing of his trades.
Every Floor Trader and Floor Broker must leave contact information with the clearing member
through which or for which he has traded in order that he may be contacted during the balance of the
day in the event there is a discrepancy in the clearing of his trades.
Each Floor Trader and Floor Broker or his designated representative must be available on the trading
floor to resolve outtrades in contracts in which he executed trades on the previous day no later than
30 minutes prior to the opening of the relevant market (or at such other times as may be designatedby Exchange officials). If the trader or broker or his designated representative is not present during
such period, the clearing member through which or for which the trader or broker has traded shall beauthorized to resolve any outtrade in the manner it deems appropriate, but such resolution shall not© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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be determinative of the liability of any party to the outtrade.

536.

RECORDKEEPING REQUIREMENTS FOR PIT, GLOBEX, AND NEGOTIATED
TRADES

39B

536.A.
General Requirements for Open Outcry Pit Trades
At the time of execution, it shall be the duty of every member to record each trade made for an
account the member owns or controls showing the date, price, quantity, product, expiration month,
bracket symbol, opposite trader, opposite clearing member and, for options, put or call and strikeprice. Floor brokers executing an order shall record their trading symbol, price, quantity, bracket,
opposite trader and clearing member. Trades or order executions must either be recorded on an
approved electronic device or, if recorded on written records, in non-erasable ink.
Members must designate on the trading document used to record a trade whether such trade is aspread trade and record “D” for single line entry differential spreads and “6” for all other spreads.
A member may correct any errors on written trading records by crossing out erroneous trade
information without obliterating or otherwise making illegible any of the originally recorded
information.
Each member shall provide his clearing member with any trading documents which are relied upon
for transactional information necessary for submission to the clearing system containing those tradesthat have been executed thus far during that day. Trading documents include trading cards ofmembers' personal and proprietary trades, trading cards of one member reflecting trades executedon behalf of another member and floor order tickets. Such trading documents must be submitted
and timestamped no later than 15 minutes after the end of each half-hour interval. If a broker has
only partially filled an order at the end of a half-hour period, he does not have to submit the documentused to record the execution to the appropriate clearing member until the entire order has been filled,
the unexecuted portion of the order is cancelled, or the market has closed for that contract, whicheveroccurs first.
In addition, each member must maintain, and is accountable for, all other documents on which
original trade information is recorded, whether or not such information is subsequently endorsed onan order ticket or entered into an approved electronic device. Trading cards used to record theexecution of flashed or electronically transmitted orders are not required to have the member’s
trading symbol pre-printed on them, but such cards must be visually distinct from the pre-printed
trading cards used by the member to record trades for accounts he owns or controls.
The correct bracket symbol in accordance with the list below must be recorded for each pit trade.
108B

Time Intervals

Bracket CodeUnknown to data entry operator?

Opening range for each contract$

Closing range for each contract%

Post Close Session#

7:00:00 a.m. – 7:14:59 a.m.

A

7:15:00 a.m. – 7:29:59 a.m.

B

7:30:00 a.m. – 7:44:59 a.m.

C

7:45:00 a.m. – 7:59:59 a.m.

D

8:00:00 a.m. – 8:14:59 a.m.

E

8:15:00 a.m. – 8:29:59 a.m.

F

8:30:00 a.m. – 8:44:59 a.m.

G

8:45:00 a.m. – 8:59:59 a.m.

H

9:00:00 a.m. – 9:14:59 a.m.

I

9:15:00 a.m. – 9:29:59 a.m.

J

9:30:00 a.m. – 9:44:59 a.m.

K

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Time Intervals

Bracket Code9:45:00 a.m. – 9:59:59 a.m.

L

10:00:00 a.m. – 10:14:59 a.m.

M

10:15:00 a.m. – 10:29:59 a.m.

N

10:30:00 a.m. – 10:44:59 a.m.

O

10:45:00 a.m. – 10:59:59 a.m.

P

11:00:00 a.m. – 11:14:59 a.m.

Q

11:15:00 a.m. – 11:29:59 a.m.

R

11:30:00 a.m. – 11:44:59 a.m.

S

11:45:00 a.m. – 11:59:59 a.m.

T

12:00:00 p.m. – 12:14:59 p.m.

V

12:15:00 p.m. – 12:29:59 p.m.

W

12:30:00 p.m. – 12:44:59 p.m.

X

12:45:00 p.m. – 12:59:59 p.m.

Y

1:00:00 p.m. – 1:14:59 p.m.

Z

1:15:00 p.m. – 1:29:59 p.m.

2

1:30:00 p.m. – 1:44:59 p.m.

3

1:45:00 p.m. – 1:59:59 p.m.

4

2:00:00 p.m. – 2:14:59 p.m.

5

2:15:00 p.m. – 2:29:59 p.m.

6

2:30:00 p.m. – 2:44:59 p.m.

7

2:45:00 p.m. – 2:59:59 p.m.

8

3:00:00 p.m. – 3:15:00 p.m.
9Trades that are not recorded contemporaneously due to an error or an outtrade shall be recorded on
the member’s next pre-printed, sequentially numbered trading card. If the trade is not recorded insequence, the member must cross out the pre-printed sequence number and write “9999” on thecard. In any situation where someone other than the member is resolving a member’s outtrades, theouttrade clerk or broker’s clerk may use a blank card and write “9999” on the card to denote that it isout of sequence. The person resolving the outtrade for a member must initial the card.
Firms must enter an “E” into the order type field to identify any errors placed into a firm error account.
1. Customer Orders
At the time of execution, every order received from a customer must be in the form of a written or
electronic record and include an electronic timestamp reflecting the date and time such order wasreceived on the floor of the Exchange and, except as provided in Section C., must identify the specificaccount(s) for which the order was placed. Such record shall also include an electronic timestampreflecting the date and time such order was modified, returned, confirmed or cancelled.
Upon request, a clearing firm must provide its broker, in an expeditious and reasonable manner, witha copy of every floor order such broker is asked to execute.
2. Individual Member Orders
a. A member on the trading floor who enters an order with another member shall record theorder instructions and the time of placement to the nearest minute in sequence with theother trades recorded on his pre-sequenced trading cards, unless such order is immediately
entered into an approved electronic device or recorded pursuant to Section 2.b. below.
Orders that involve options-futures combinations and other spread trades where theinitiating member personally executes at least one leg of the spread shall not be subject to© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

Page 22 of 50

this requirement.
The member executing the order must record the time of execution to the nearest minutefor each execution made for the order on the trading card or other document used to record
the trade(s) and must return this card or document to the initiating member.
The trading card used to record the placement of the flashed or verbal order and any tradingcard or document used to record the execution of the order must be submitted together tothe clearing member by the member placing the order or his representative.
b. Every written order that is initiated by a member for his own account while on the trading
floor must include an electronic timestamp reflecting the date and time such order wastransmitted for execution and when such order was modified, returned, confirmed orcancelled.
c. A member or his employee standing in a trading pit receiving an order directly over aheadset for pit execution from an off-floor member for his account must simultaneously
make a written record of the order on a trading card or other document including theidentification of the member calling in the order unless such order is immediately enteredinto an approved electronic device. The member executing the order must record the timeof execution to the nearest minute for each execution made for the order on any tradingcard or other document used to record the trade(s) and must return this card or document
to the initiating member’s clearing member.
3. Proprietary Orders of Clearing Members and Certain Member Entities
Upon receipt on the floor of the Exchange, an order placed for the proprietary account of a member
firm must be in the form of a written or electronic record that includes an electronic timestampreflecting the date and time such order was received on the floor and must identify the specificaccount(s) for which the order was placed. Such record shall also include an electronic timestampreflecting the date and time such order was modified, returned, confirmed or cancelled.
Orders placed by an employee of a member firm for its proprietary account that are entered directly
to the pit via headset with another employee of the member firm do not require a written andtimestamped order ticket provided that the order is executed by a member employee of the member
firm and such member records the time of execution to the nearest minute for each execution madefor the order on the trading card or other document used to record the trade(s).
4. Trades Made by Members for Accounts Owned or Controlled by Such Member
Each member executing transactions on the trading floor for such member’s personal account or an
account controlled by such member who uses trading cards as the original record of suchtransactions must use pre-printed sequentially pre-numbered trading cards. A new trading card must
be used at the beginning of each time bracket.
Each member who uses such trading cards must record the transactions in non-erasable ink in exact
chronological order of execution on sequential lines of the trading card, and no lines may be skipped.
Any lines that remain after the last execution recorded on a trading card must be marked through.
All transactions which are recorded on a single trading card must be recorded on the same side ofsuch trading card. No more than six transactions may be recorded on each trading card. Tradingcard sequence numbers must be unique during a one-week period.
The trading cards must contain pre-printed member identification which will include, but will not belimited to, the trading acronym and the full name of the member. The trading cards must also containpreprinted bracket designations.
Members who use an approved electronic device to record their trades, whether as an original record,or subsequent to recording their trades on trading cards, must record their trades on the device inthe exact sequence in which they were executed and must ensure that the correct time bracket isentered for each transaction.
Members trading for an account they own or control shall be accountable for their pre-printed
sequentially numbered trading cards, including those cards which are unused or voided.
536.B.
Globex Order Entry
1. General Requirement
Each Globex Terminal Operator entering orders into Globex shall accurately input for eachApplication Message all fields required to be populated by the CME iLink® Message Specifications
set forth in the CME Group Client Systems Wiki in effect at the time, including, but not limited to the:operator ID; price; quantity; product; expiration month; CTI code; manual order indicator; and account
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number (except as provided in Section C), and, for options, put or call and strike price. The Globex
Terminal Operator’s operator ID must be present on each Application Message, including ordermessages, submitted to Globex. For a Globex Terminal Operator with access pursuant to Rule574, t h e clearing member that guarantees such access to Globex will be responsible for the
Globex Terminal Operator’s compliance with this rule with respect to the following fields: operator ID,
CTI code, manual order indicator and account number. Notwithstanding, and in accordance with Rule574, a clearing member must take appropriate action if it has actual or constructive knowledge that a
Globex Terminal Operator has failed to accurately input for each Application Message fields required
to be populated by this rule.
With respect to orders received by a Globex Terminal Operator which are capable of being
immediately entered into Globex, no record other than that set forth above need be made. However,
if a Globex Terminal Operator receives an order which cannot be immediately entered into Globex,
the Globex Terminal Operator must prepare a written order and include the account designation,
date, time of receipt and other information required pursuant to section A.1. above. The order must
be entered into Globex when it becomes executable.
2. Electronic Audit Trail Requirements for Electronic Order Routing/Front-End Systems
Entities certified by the Exchange to connect an order routing/front-end system to the Globex platform
through the CME iLink® gateway are responsible for ensuring that an audit trail of each message
entered into Globex is created. Clearing members guaranteeing a connection to Globex are
responsible for maintaining or causing to be maintained the electronic audit trail for such systems.
This electronic audit trail must be maintained for a minimum of 5 years, and clearing members musthave the ability to produce this data in a standard format upon request of Market Regulation.
Each such electronic audit trail must be complete and accurate and account for every electronic
communication such system sends to or receives from Globex.
This electronic audit trail must contain all order entry, order modification, and Globex response receipt
times to the highest level of precision achievable by the operating system, but at least to themillisecond. The times captured must not be able to be modified by the person entering the order.
The data must also contain all required information and fields which include, but is not limited to, thefollowing:a record of all fields relating to order entry, including transaction date, product, Exchange code,
expiration month, quantity, order type, order qualifier, price, buy/sell indicator, stop/trigger price, ordernumber, unique transaction number, account number, session ID, operator ID, manual orderindicator, self-match prevention ID where applicable, host order number, trader order number,clearing member, type of action, action status code, customer type indicator, origin, and timestamps.
For executed orders, the audit trail must record the execution time of the trade along with all fill
information.
In the case where the guaranteeing Clearing Firm has a direct connect client that is another Clearing
Firm or an Equity Member Firm, the Clearing Firm may notify the client Clearing Firm or Equity
Member Firm that it is their obligation to maintain the electronic audit trail. Upon execution of thiswritten notice, it shall be the duty of the client Clearing Firm or Equity Member Firm to maintain anelectronic audit trail pursuant to this rule. Nothing herein relieves any of the above-referenced firms
from compliance with the applicable recordkeeping provisions of CFTC Regulations, including
Regulation 1.31 or 1.35.
536.C.
Bunched Orders and Orders Eligible for Post Execution Allocation
Bunched orders must be allocated and recorded in accordance with CFTC Regulation 1.35(b) andthe NFA’s Interpretive Notice related to Compliance Rule 2-10.
A bunched order for pit execution does not require the specific account number to be recorded at thetime of order placement or upon the report of execution provided that 1) the order is being placed byan eligible account manager for multiple accounts eligible for post execution allocation or 2) a written,
pre-determined allocation scheme has been provided to the futures commission merchant accepting
or clearing the order prior to the time the order has been placed. Additionally, at the time of receipt
on the trading floor, bunched orders that do not contain specific account numbers must contain aseries, group, or suspense account indicator which relates directly to the group of accounts for which
the order has been placed. A bunched order may be initially cleared into a suspense accountprovided that the final account-specific allocations are submitted to the clearing system no later thanthe end of each trading day.
Bunched orders for non-discretionary accounts may be entered for pit execution; however, only the
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following order types may be bunched: Market on Open, Market on Close, same priced Limit Orders
and same priced Stop Orders. Such non-discretionary orders may only be bunched in the following
instances:a. Each order underlying the bunched order must be reduced to writing and include theinformation required pursuant to Section A.1. above;
b. Allocation of the executions for the bunched orders must be fair and equitable in accordancewith the NFA’s Interpretive Notice related to Compliance Rule 2-10; andc. In circumstances where the order is bunched in a member firm’s sales office, the party accepting
the order must, contemporaneously with the order placement, transmit the individual accountnumbers and quantities associated with the bunched order to the clearing member firm. Suchtransmission shall be maintained by the clearing member firm along with the bunched order.
With respect to bunched Globex orders, such orders may be entered using a series designation orsuspense account number provided that 1) the order is being placed by an eligible account manager
for multiple accounts eligible for post execution allocation or 2) a written, pre-determined allocation
scheme that defines the series has been provided to the futures commission merchant accepting or
clearing the order prior to the time that such order is entered. In the latter case, if such information
has not been provided to the futures commission merchant prior to the time of order entry, eachspecific account number must be entered into Globex. Additionally, for all such bunched orders
executed on Globex, the final account specific allocations must be submitted to the clearing systemno later than the end of each trading day.
536.D.
Customer Type Indicator (CTI) Codes
Each clearing member must identify each transaction 1) executed on the trading floor, 2) executedon the Globex platform or 3) privately negotiated as a block trade pursuant to Rule 526 or an EFRP
pursuant to Rule 538 on the record of the transaction submitted to the Exchange with the correctcustomer type indicator (CTI) code. The CTI codes are as follows:
CTI 1: Electronic Trading, Open Outcry and Privately Negotiated – Applies to transactions initiatedand executed by an individual member for his own account, for an account he controls, or for an
account in which he has an ownership or financial interest. However, transactions initiated andexecuted by a member for the proprietary account of a member firm must be designated as CTI 2
transactions.
CTI 2: Electronic Trading, Open Outcry and Privately Negotiated – Applies to orders entered or trades
executed for the proprietary accounts of a member firm, including Rule 106.H., I., N., R. and S. firms.
CTI 3: Electronic Trading – Applies to orders entered by a member or a nonmember terminal operator
for the account of another individual member or an account controlled by such other individual
member.
CTI 3: Open Outcry and Privately Negotiated – Applies to orders that a member executes on behalfof another individual member, or for an account such other member controls or in which such othermember has an ownership or financial interest.
CTI 4: Electronic Trading, Open Outcry and Privately Negotiated – Applies to all orders andtransactions not included in CTI categories 1, 2 or 3. These typically are orders entered by or on
behalf of nonmember entities.
536.E.
Negotiated Trades
At the time of execution, every order received from a customer for execution pursuant to Rule 526(“Block Trades”) and Rule 538 (“Exchange for Related Positions”) must be in the form of a written
or electronic record and include an electronic timestamp reflecting the date and time such order
was received, and must identify the specific account(s) for which the order was placed. Such
record shall also include an electronic timestamp reflecting the date and time such order was
modified, returned, confirmed or cancelled.
536.F.
Audit Trail Violations
With the exception of the specific audit trail violations set forth below, a member’s failure to comply
with any provision of this Rule may result in the imposition of summary penalties by the Market
Regulation Department pursuant to the provisions of Rule 512.
Computerized Trade Reconstruction (“CTR”) Monthly Enforcement Program
The CTR threshold levels for members with 100 or more transactions per month are as
follows:
1B

12B

13B

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Exception TypeThreshold Level

Bracket Exceptions

8% and above

Time of Execution for
Verbal Orders

8% and above

Sequence Errors

8% and above

A letter of warning shall be issued for a first occurrence of exceeding any threshold. Subsequent
occurrences within 12 months of exceeding a threshold shall result in automatic fines starting at$1,000, and then increasing to $2,500 and $5,000 for each subsequent occurrence. Fifth andsubsequent offenses within a 12 month period will be referred to the Chief Regulatory Officer forconsideration of charges.
A member will have 15 days after receipt of a letter of warning or a fine to present evidence to theMarket Regulation Department in support of having the letter of warning or fine dismissed showingthat administrative, clerical, or other errors by the clearing firm caused the member to exceed thethreshold level. If the member does not submit such evidence, or if the Market Regulation Department
determines that the evidence submitted is insufficient to reduce the percentage below the thresholdlevel, the letter of warning or fine shall be final and may not be appealed.
The monthly CTR threshold for timestamp exceptions for firms with 1,000 or more transactions permonth is 8% and above. A letter of warning shall be issued for a first occurrence of exceeding thethreshold. Subsequent occurrences within 12 months of exceeding the threshold shall result in
automatic fines starting at $1,500 for the second occurrence, then increasing to $5,000 and $10,000
for each subsequent occurrence.
A firm will have 15 days after receipt of a letter of warning or a fine to present evidence to the Market
Regulation Department in support of having the letter of warning or fine dismissed. If the firm does
not submit such evidence, or if the Market Regulation Department determines that the evidence
submitted is insufficient to reduce the percentage below the threshold level, the letter of warning or
fine shall be final and may not be appealed.
CTR Clearing Member Back Office Audit Enforcement Program
The Market Regulation Department will conduct audits of clearing members to verify that required
audit trail information has been accurately recorded and submitted. The CTR audit threshold levelfor firms failing to pick up and timestamp sequenced cards, verbal order cards and floor orders is20%. The threshold for all other firm audit trail or recordkeeping deficiencies is 10%.
Percentage calculations will be made based on an examination of a combination of sequenced cards,
verbal orders and floor orders totaling 150 documents. The number of documents containing a
deficiency(ies) will be divided by the total number of documents examined in determining the
deficiency percentage.
Violations of each threshold within 24 months shall be subject to automatic fines starting at $2,500
for a first occurrence, then increasing to $5,000 and $10,000 for each subsequent occurrence.
A firm will have 15 days after receipt of a fine to present evidence to the Market Regulation
Department in support of having the fine dismissed. If the firm does not submit such evidence, or if
the Market Regulation Department determines that the evidence submitted is insufficient to reduce
the percentage below the threshold level, the fine shall be final and may not be appealed.
Notwithstanding the provisions of this Section, the Market Regulation Department may, at any time,refer matters that it deems egregious to the Chief Regulatory Officer for consideration of charges.
536.G.
Telephone Recordings
Unless specifically exempted by the Market Regulation Department or designated Exchange staff,
all headset communications used in and around trading pits on the trading floor must be voicerecorded. Members and member firms are permitted to utilize their own recording devices, provided
that the devices meet reasonable standards with respect to quality and reliability. Alternatively,
members and member firms may utilize an Exchange administered voice recording system for a fee.
536.H.
Retention of Records
Each member and member firm and employees of the foregoing must keep full, complete andsystematic records, including records created or transmitted electronically, together with all pertinent
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data and memoranda, of all transactions relating to its business of dealing in commodity interests
and related cash or forward transactions in accordance with CFTC Regulation 1.35. Written andelectronic records must be retained for a minimum of five years in permanent form. Oral
communications required to be recorded pursuant to CFTC Regulation 1.35(a) must be retained fora minimum of one year past the date on which the oral communication occurred. Oral
communications recorded by the Exchange pursuant to Section G. will be maintained by the
Exchange for a minimum of one year past the date on which the oral communication occurred.
All records required to be retained shall at all times be open to inspection by Exchange staff or any
representative of the CFTC or the United States Department of Justice.

537.
40B

DATA SUBMITTED TO THE EXCHANGEa) Subject to each market participant's rights with respect to its own data, the Exchange shall own
all rights, title and interest, database rights and trade secret rights in and to all trade data and related
information submitted in connection with trading on the Exchange, and which is not collected or
received for the purpose of fulfilling regulatory obligations. The Exchange has the exclusive right touse, distribute, sub-license, disclose and sell anonymized trade data and derivative works in any
manner, media and jurisdiction. Market participants shall not redistribute trade data or derivative
works based thereon unless licensed by the Exchange. The restriction on redistribution shall not
apply to a market participant's own data.
b) Proprietary data or personal information collected or received by the Exchange for the purpose offulfilling regulatory obligations shall not be disclosed publicly other than on an aggregated oranonymized basis, or in a manner that does not directly or indirectly identify any market participant
who has submitted such data. Regulatory data may not be used by the Exchange for business ormarketing purposes unless the market participant has clearly consented to the use of such data insuch manner. Access to the Exchange will not be conditioned upon a market participant's consent
to data collected or received for the purpose of fulfilling regulatory obligations being used for businessor marketing purposes. Nothing in this Rule shall preclude the Exchange from disclosing data
pursuant to a valid subpoena or court order, or as otherwise required by law.

538.
41B

EXCHANGE FOR RELATED POSITIONSAn Exchange for Related Position (“EFRP”) transaction involves a privately negotiated off-exchange
execution of an Exchange futures or options contract and, on the opposite side of the market, thesimultaneous execution of an equivalent quantity of the cash product, by-product, related product, or
OTC derivative instrument corresponding to the asset underlying the Exchange contract.
The following types of EFRP transactions are permitted to be executed outside of the Exchange’s
centralized market in accordance with the requirements of this rule:Exchange of Futures for Physical (“EFP”) – the simultaneous execution of an Exchange futurescontract and a corresponding physical transaction or a forward contract on a physicaltransaction.
Exchange of Futures for Risk (“EFR”) – the simultaneous execution of an Exchange futurescontract and a corresponding OTC swap or other OTC derivative transaction.
Exchange of Option for Option (“EOO”) – the simultaneous execution of an Exchange option
contract and a corresponding transaction in an OTC option.
For purposes of this rule, EFPs, EFRs and EOOs shall collectively be referred to as EFRP
transactions.
538.A.
Parties to an EFRP
One party to the EFRP must be the buyer of the Exchange contract and the seller of (or the holderof the short market exposure associated with) the related position; the other party to the EFRP must
be the seller of the Exchange contract and the buyer of (or the holder of the long market exposure
associated with) the related position. The Exchange contract and the corresponding related position
must be executed for accounts with the same beneficial ownership.
A third party may facilitate, as principal, the related position component of an EFRP on behalf of acustomer. Except for immediately offsetting foreign currency EFPs executed pursuant to Section K.,
such third party must be able to demonstrate that the related position was passed through to thecustomer who received the Exchange contract as part of the EFRP.
Specifically with respect to the execution of immediately offsetting foreign currency EFPs pursuant
to Section K. by CTAs, account controllers, or other Persons acting on behalf of another party, the© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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initiating and offsetting cash legs are not required to be passed through to the customer who received
the Exchange contract as part of the EFRP. However, in a circumstance where the futures leg of thetransaction fails to clear, the underlying customer must receive the profit or loss, if any, attendant to
the offset of the offsetting cash leg.
Parties to an EFR or EOO transaction must comply with all relevant CFTC regulations governing
eligibility to participate in the related position component of such transactions.
538.B.
Independently Controlled Accounts
The opposing accounts to an EFRP transaction must be (a) independently controlled accounts withdifferent beneficial ownership; (b) independently controlled accounts of separate legal entities with
common beneficial ownership; or (c) independently controlled accounts of the same legal
entity, provided that the account controllers operate in separate business units.
For EFRP transactions between accounts with common beneficial ownership, the parties to the trademust be able to demonstrate the independent control of the accounts and that the transaction had
economic substance for each party to the trade.
538.C.
Related Position
The related position component of an EFRP must be the cash commodity underlying the Exchange
contract or a by-product, a related product or an OTC derivative instrument of such commodity thathas a reasonable degree of price correlation to the commodity underlying the Exchange contract.
The related position component of an EFRP may not be a futures contract or an option on a futurescontract.
Each EFRP requires a bona fide transfer of ownership of the underlying asset between the parties
or a bona fide, legally binding contract between the parties consistent with relevant market
conventions for the particular related position transaction.
The execution of an EFRP transaction may not be contingent upon the execution of another EFRP
or related position transaction between the parties where the transactions result in the offset of therelated position without the incurrence of market risk that is material in the context of the related
position transactions.
The facilitation of the execution of an EFRP by any party that knows such EFRP is non bona fideshall constitute a violation of this Rule.
538.D.
EFPs in Connection with Inventory Financing of Storable, Non-Financial
Commodities
A party providing inventory financing for a storable agricultural, energy or metals commodity may,through the execution of an EFP, purchase the commodity and sell the equivalent quantity of futurescontracts to a counterparty, and grant to the counterparty the non-transferable right, but not the
obligation, to execute a second EFP during a specified time period in the future which will have theeffect of reversing the original EFP.
538.E.
Quantity Equivalence
The quantity of the related position component of the EFRP must be approximately equivalent to thequantity of the Exchange component of the EFRP. Appropriate hedge ratios between the Exchange
and related position components of the EFRP may be used to establish equivalency.
538.F.
Prices and Price Increments
The Exchange component of the EFRP transaction must be priced in accordance with the applicablefutures price increments or option premium increments as set forth in the rules governing the
Exchange contract.
EFRPs may be transacted at such commercially reasonable prices as are mutually agreed upon by
the parties to the transaction. EFRPs may not be priced to facilitate the transfer of funds between
parties for any purpose other than as the consequence of legitimate commercial activity.
538.G.
EFRPs Following the Termination of Trading in Exchange Contracts
EFRP transactions in certain Exchange contracts may be executed for a defined period of time
following the termination of trading in accordance with the applicable product rules governing each
Exchange contract. Such transactions may be executed only to liquidate Exchange positions.
538.H.
Recordkeeping
Parties to an EFRP transaction must maintain all records relevant to the Exchange contract and therelated position transaction, including order tickets, records customarily generated in accordancewith relevant market practices, records reflecting payments between the parties and, whereappropriate, transfer of title, as well as any other records required to be kept pursuant to CFTC

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Regulation 1.35. Brokers who facilitate EFRP transactions must maintain all records corresponding
to their facilitation of the transactions.
Records related to EFRP transactions must be provided to the Exchange upon request. It shall be
the responsibility of the carrying clearing member firm to obtain and submit the requested records oftheir clients to the Exchange on a timely basis.
538.I.
Submission to the Clearing House
Each EFRP transaction shall be submitted to the Clearing House within the time period and in themanner specified by the Exchange and the Clearing House. In all cases, the record submitted to theClearing House must reflect the correct EFRP transaction type and must reflect the accurate date
and time at which the relevant terms of the transaction were agreed upon by the parties to the trade.
An EFRP transaction submitted to the Clearing House shall not be considered accepted by the
Clearing House until the transaction has cleared and the first payment of settlement variation andperformance bond has been confirmed.
538.J.
EFRP Volumes Required to be Reported with Daily Large Trader Positions
Each clearing member, omnibus account and foreign broker responsible for submitting daily large
trader positions in accordance with Rule 561 must submit for each reportable account the EFRP
volume bought and sold in the reportable instrument. This information must be included in the daily
Large Trader report to the Exchange.
538.K.
Immediately Offsetting EFPs in Foreign Currency Futures
EFPs in foreign currency futures wherein the parties immediately offset the cash transaction are
permitted and the Exchange would expect to see confirmation statements issued by the bank/foreignexchange dealer party to the Transaction. These confirmation statements should be the typenormally produced by the bank/foreign exchange dealer for confirmation of currency deals andshould indicate, by name, the identity of the counter party principal to the Transaction. However, incircumstances where the EFP Transaction is between a bank/foreign exchange dealer and a CTA,
account controller, or other Person acting on behalf of a third party (such as a commodity pool orfund), the cash side confirmation statement must identify, at minimum, the name of the third party’s
Carrying Clearing Member and the third party’s account number (or other account specificdesignation), but need not identify the third party by name. These transactions are only permissible
as EFPs in foreign currency futures and not in any other asset class or in EFRs or EOOs in foreign
currency futures.

539.

PREARRANGED, PRE-NEGOTIATED AND NONCOMPETITIVE TRADES
PROHIBITED

42B

539.A.
General Prohibition
No person shall prearrange or pre-negotiate any purchase or sale or noncompetitively execute anytransaction, except in accordance with Sections B. and C. below.
539.B.
Exceptions
The foregoing restriction shall not apply to block trades pursuant to Rule 526 or Exchange for Related
Positions transactions pursuant to Rule 538.
539.C.
Pre-Execution Communications Regarding Globex Trades
Parties may engage in pre-execution communications with regard to transactions executed on the
Globex platform where one party (the first party) wishes to be assured that a contra party (the second
party) will take the opposite side of the order under the following circumstances:
1. A party may not engage in pre-execution communications with other market participants onbehalf of another party unless the party for whose benefit the trade is being made has previously
consented to permit such communications.
2. Parties to pre-execution communications shall not (i) disclose to a non-party the details of such
communications or (ii) enter an order to take advantage of information conveyed during such
communications except in accordance with this rule.
3. Permissible Entry Methods for Orders
The following order entry methods for futures, options, spreads and combinations vary by
product, as set forth in the Rule 539.C. Crossing Protocols Table (“Table”) in the Interpretations
Section at the end of Chapter 5.
a. Globex Cross (“G-Cross”)
15B

16B

17B

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b.

c.

540.

The first party’s order is entered into the Globex platform first. The second party’s order
may not be entered into the Globex platform until a period of 5 seconds has elapsed fromthe time of entry of the first order.
Committed Cross (“C-Cross”)
Following the pre-execution communication, a Request for Cross (“RFC”) order whichcontains both the buy and the sell orders must be entered into the Globex platform. Upon
entry of the RFC, the Globex platform will display an indication that a cross will occur in five(5) seconds. In certain products as set forth in the Table in the Interpretations Section at
the end of Chapter 5, a certain percentage of the quantity on the RFC will cross if the priceof the RFC represents a new best price level or if the price of the RFC is equal to the best
bid or offer and the quantity of the RFC is greater than the quantity at that current best bid
or offer at the time of submission of the RFC to the Globex platform and a better price for
either the buy or sell order has not been entered into the Globex platform during the five (5)second period between entry of the RFC and the cross occurring.
RFQ + RFC Cross (“R-Cross”)
Following the pre-execution communication, a Request for Quote (“RFQ”) for the particular
futures, options spread or combination must be entered into Globex. Thereafter, the RFC
order must be entered no less than fifteen (15) seconds and no more than thirty (30)seconds after the entry of the RFQ in order to proceed with the trade, except the RFC orderin Dairy futures and options must be entered no less than five (5) seconds and no morethan thirty (30) seconds after the entry of the RFQ. The RFQ and the RFC order must beentered within the same trading session. Failure to enter the RFC order within 30 seconds
after the entry of the RFQ will require a new RFQ to be entered prior to the entry of the RFC
order, which must be entered in accordance with the time parameters described above inorder to proceed with the trade.

RESPONSIBILITY FOR CUSTOMER ORDERS

43B

540.A.
Standard of Responsibility
A Member (as defined in Rule 400) shall exercise due diligence in the handling and execution ofcustomer orders. Failure to act with due diligence shall constitute negligence. In the case of adispute as to whether a Member has exercised due diligence, the appropriate arbitration or
disciplinary committee is authorized to determine whether the Member was negligent and, if so,whether an adjustment is due to the customer. The committee may take into consideration the natureof the order and existing market conditions, including the existence of a "fast market" (a designation
invoked to reflect rapid price changes and volatile market conditions in the pit), at the time theMember acted or failed to act. However, no market condition nullifies a Member's responsibility to
exercise due diligence.
A Member is prohibited from directly or indirectly guaranteeing the execution of an order or any of its
terms such as the quantity or price. A Member may only report an execution that has occurred as aresult of open outcry, has been effected through the Globex platform, or has been executed as apermissible privately negotiated transaction. This rule shall not be construed to prevent a Member
from assuming or sharing in the losses resulting from an error or the mishandling of an order.
540.B.
Liability for Negligence
A Member may not adjust the price at which an order was executed or be held responsible for
executing or failing to execute an order unless such Member was negligent or is settling a bona-fide
dispute regarding negligence.
A member firm may not compel an adjustment from a Member in the absence of a bona-fide dispute
regarding negligence.
Clearing members shall document all adjustments. Clearing members shall make and retain a record
which contains the date the adjustment was received, the name of the Member making theadjustment, the account to which the adjustment was credited, the amount of the adjustment, theorder number and the reason for the adjustment. Such records must be provided to the Market
Regulation Department upon request.
18B

19B

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541.

[RESERVED]

542.

SIMULTANEOUS SPREAD AND COMBINATION TRANSACTIONS

4B

45B

A.

B.

C.
D.

E.
F.

543.

All spread or combination transactions in which all sides are acquired simultaneously must be
for the same account or accounts with the same ownership, except as provided by Rule 527.
Each of the respective legs of the spread or combination transaction must be priced within thedaily price limits for those contracts that have limits.
Spread or combination transactions shall not set off conditional orders in any contract except for
an identical spread or combination conditional order. All simultaneous spread or combinationtransactions must be reported to a designated Exchange official who shall record and publish
the differentials or combination prices in addition to the quantities of such trades. The brokers
executing any spread or combination transaction must maintain a record of the transaction inaccordance with Rule 536.
For the purposes of this rule, a whole integer price is an option price that is divisible by one tickwithout remainder (e.g., one tick, two ticks, three ticks, etc.). For the purposes of this rule, anon-integer tick price is an option price that is not divisible by one tick without remainder (i.e.,
one-half tick or cabinet, one and one-half ticks, and two and one-half ticks). In addition, the rulein an option's contract specifications defining that given option contract's minimum fluctuations
also defines that option contract's whole integer and non-integer tick prices for the purposes ofthis rule.
Spread or combination transactions involving options on interest rate futures contracts trading
at non-integer tick prices other than those transactions explicitly defined in this rule are notallowed.
Any spread or combination transaction involving cabinet options may trade, provided that thetraded price of the combination is zero, cabinet, or 1 tick, as defined by that product’s minimum
fluctuations.
For the purposes of this rule, a cabinet option is an option trading at a price of one-half tick(except for options on Three–Month Euroyen futures), and a one-tick option is an option trading
at a price of one tick. In addition, the rule in an option's contract specifications defining thatgiven option contract's minimum fluctuations also defines that option contract's one-tick priceand one-half tick price for the purposes of this rule. Also, the rule in an option's contract
specifications defining that given option contract's underlying futures contract also defines that
underlying futures contract for the purposes of this rule.
Spread or combination transactions involving cabinet options other than those transactions
explicitly defined in this rule are not allowed.
[Reserved]
Trading is allowed in simultaneous spread or combination transactions involving options on FX
futures contracts trading at whole integer and non–integer tick prices, subject to the conditions
applying to other spread or combination transactions and also subject to the following
respective additional conditions:
1. Spread and combination transactions may trade at a non–integer tick price provided that the
net absolute price differential or aggregate combination price, as applicable, is five ticks or
less.
2. Conversion and reversal transactions involving the purchase and sale of options and futures
are also allowed to trade at one–half tick provided that each component futures is assigned an
integer price.
[Reserved]
On Globex, spread or combination transactions shall be made by inputting the spread differential
or combination price into the Globex system.
For combinations traded on Globex in price terms, the Exchange will allocate the combination
trade price among the individual options in the combination for clearing purposes.

RESTRICTIONS ON ACCESS FOR SANCTIONED PARTIES AND JURISDICTIONS
The following parties (defined individually as a “Sanctioned Party” and collectively as “Sanctioned
Parties”) are not permitted to access the Exchange, whether directly or indirectly: parties that are (i)identified on the Specially Designated Nationals and Blocked Persons List of the U.S. Department of
the Treasury’s Office of Foreign Assets Control (“OFAC”) (“Restricted Persons”), (ii) 50% or more

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owned by Restricted Persons, (iii) located in a country or territory subject to comprehensive economic
sanctions administered by OFAC (“Restricted Country or Territory ” or “Restricted Countries or
Territories”), (iv) owned or controlled by the governments of Restricted Countries or Territories, (v)subject to OFAC restrictions where such restriction prohibits a specific activity which would in turnprohibit the party from trading on the Exchange or settling a transaction at the Exchange, (vi) subject
to restrictions administered or imposed by a state or government authority authorized to issue
economic sanctions and blocking measures that has jurisdiction over a Clearing Member (each a“Sanctioning Body”) or (vii) acting on behalf of any of the foregoing.
Unless permitted (either not restricted or specifically authorized) by OFAC and/or any Sanctioning
Body, as applicable, (a) any Clearing Member that maintains positions or carries an account actively
trading on the Exchange for a Person that is or becomes a Sanctioned Party or (b) any Clearing
Member becomes aware, or has documentary information, that it maintains positions or carries anaccount actively trading on the Exchange on behalf of a Sanctioned Party, shall immediately takesteps to (i) cancel all direct and indirect access and authorizations issued to such Sanctioned Party
and provide written notice to the Exchange of such cancellations; or (ii) provide written instructions
to the Exchange directing the Exchange to assist and coordinate in the cancellation of all access andauthorizations for the Sanctioned Party at the Exchange as may be applicable.

544.
46B

CLOSING DAY ORDERS
During the last day of trading in an expiring futures contract, all allowable types of orders that reachthe trading floor less than 15 minutes prior to the close of trading, except for market, closing, spread,limit and stop orders, will be accepted solely at the risk of the customer on a not-held basis. A broker
shall not be responsible for cancellations unless the cancellation reaches the broker at least 15
minutes prior to the close on the last day of trading in an expiring futures contract.

545.

[RESERVED]

546.

OPENING AND CLOSING RANGES DURING REGULAR TRADING HOURS

47B

48B

Opening and closing ranges shall be established by Exchange staff in consultation with the Pit
Committee.
In the event of a disputed opening or closing range or a trade during the opening or closing rangethat is conspicuously out of line with the market, the final determination of the opening or closing
range shall be made by Exchange staff in consultation with the Pit Committee. A change in the
opening range will be allowed only if the request for a change is made within 15 minutes of the postingof the range. A change in the closing range will be allowed only if the request for a change is madewithin 10 minutes of the posting of the range.

547.
49B

DISCRETIONARY ORDERS
Other than DRT orders, no Member (as defined in Rule 400) shall accept an order that gives more
latitude than price and time in execution of the order, except in accordance with the provisions ofRule 956.
The above restriction shall not apply to those orders:
1. placed by another member for an account owned by such member;
2. placed by the member’s immediate family which includes a spouse, parent, child, grandparent,
grandchild, brother, sister, aunt, uncle, nephew, niece or in-law; and3. placed for proprietary accounts of member firms.

548.
50B

PRIORITY OF EXECUTION
In pit trading, non-discretionary customer orders shall be executed in accordance with their price andtime priority. A member shall not execute a discretionary order, including, without limitation, an order
allowing the member discretion as to time and price, while in possession of an executable customer
order. No person shall allocate executions in any manner other than an equitable manner.
Non-discretionary customer orders received by a Globex Terminal Operator shall be entered into
Globex in the sequence received. Non-discretionary orders that cannot be immediately entered into
Globex must be entered when the orders become executable in the sequence in which the orders
were received.

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549.-552[RESERVED]

51B

54B

553.

AVERAGE PRICE SYSTEM

5B

553.A.
Application of Average Prices
A clearing member may employ the Exchange's Average Price System or a proprietary average
pricing system to calculate an average price when multiple execution prices are received on an order
or series of orders for futures, options or combination transactions. An order or series of orders
executed during the same trading day at more than one price may be averaged pursuant to this Rule
only if each order is for the same account or group of accounts and for the same product andexpiration month for futures, or for the same product, expiration month, put/call and strike price for
options.
124B

553.B.
125B

Average Price System Requirements

The requirements enumerated below must be met for transactions that are average priced.
1. The customer must have requested average price reporting prior to order entry.
2. Each individual trade must be submitted and cleared by the Exchange at the executed price.
The average price must be confirmed to each customer account.
3. The clearing member carrying the account(s) must submit final account specific allocations in
the Exchange’s clearing system no later than the end of each trading day.
4. If a clearing member computes average prices internally, it must:a. Compute the weighted mathematical average price, as set forth in Section C.;
b. Subsequently employ the Exchange’s Average Price System to 1) facilitate the allocations
and 2) ensure that final account specific allocations are submitted to the Exchange’s
clearing system no later than the end of each trading day; andc. Create records to support the calculations and allocations to customer accounts andmaintain these records pursuant to CFTC regulations.
5. Proprietary trades of a clearing member may not be average priced with customer trades.
553.C.
Computation of Average Price
Upon receipt of an execution or match at multiple prices for an order that is to be average priced, theweighted mathematical average must be computed by: (a) multiplying the number of contracts
purchased or sold at each execution price by that price, (b) adding the results together and (c)dividing by the total number of contracts. An average price for a series of orders will be computed
based on the average prices of each order in that series. The actual average price or the average
price rounded to the next price increment may be confirmed to customers. If a clearing member
confirms the rounded average price, the clearing member must round the average price up to thenext price increment for a buy order or down to the next price increment for a sell order. The residual
created by the rounding process must be paid to the customer. An average pricing system may
produce prices that do not conform to whole cent increments. In such cases, any amounts less than
one cent may be retained by the clearing member.
553.D.
Disclosure
Each clearing member that confirms an average price to a customer must indicate on the confirmationand monthly statement that the price represents an average price.
126B

127B

56

57B

554.- 558. [RESERVED]
58B

559.
59B

POSITION LIMITS AND EXEMPTIONS
The position limit levels applicable to those contracts with position limits are set forth in the Position
Limit, Position Accountability and Reportable Level Table (“Table”) in the Interpretations Section at
the end of Chapter 5.
A person seeking an exemption from position limits must apply to the Market Regulation Department
on forms provided by the Exchange. In order to obtain an exemption from position limits, a personmust:
1. Provide a description of the exemption sought, including whether the exemption is for bona fide
hedging transactions or positions as defined in CFTC Regulation §150.1 (Bona fide hedging© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

Page 33 of 50

transaction or position), non-enumerated bona fide hedging transactions or positions, or spread
positions;
2. Provide a complete and accurate explanation of the underlying exposure related to the
exemption request;
3. Agree to promptly provide, upon request by the Market Regulation Department, information or
documentation regarding the person’s financial condition;
4. Agree to comply with all terms, conditions or limitations imposed by the Market Regulation
Department with respect to the exemption;
5. Agree that the Market Regulation Department may, for cause, modify or revoke the exemption
at any time;
6. Agree to initiate and liquidate positions in an orderly manner;
7. Agree to comply with all Exchange rules; and8. Agree to promptly submit a supplemental statement to the Market Regulation Department
whenever there is a material change to the information provided in the most recent application.
A person intending to exceed position limits, including limits established pursuant to a previously
approved exemption, must file the required application and receive approval from the Market
Regulation Department prior to exceeding such limits. However, a person who establishes a position
in excess of position limits and files the required application for bona fide hedging transactions or
positions or non-enumerated bona fide hedging transactions or positions with the Market Regulation
Department shall not be in violation of this rule provided the filing occurs within five (5) business days
after assuming the position except in circumstances where the Market Regulation Department
requires a person to file prior to the fifth business day. An application filed after exceeding a limit
must include an explanation of the sudden or unforeseen bona fide hedging need. In the event thepositions in excess of the limits are not deemed to be exemption-eligible, the applicant and clearing
firm will be in violation of speculative limits for the period of time in which the excess positions
remained open.
The Market Regulation Department shall, on the basis of the application and any requested
supplemental information, determine whether an exemption from position limits shall be granted. The
Market Regulation Department may approve, deny, condition or limit any exemption request basedon factors deemed by the Department to be relevant, including, but not limited to, the applicant's
business needs and financial status, as well as whether the positions can be established andliquidated in an orderly manner given characteristics of the market for which the exemption is sought.
Nothing in this rule shall in any way limit (i) the authority of the Exchange to take emergency action;or (ii) the authority of the Market Regulation Department to review at any time the positions owned
or controlled by any person and to direct that such position be reduced to the position limit provided
for in the Table.
A person who has received written authorization from the Market Regulation Department to exceed
position limits must annually file an updated application not later than one year following the approvaldate of the most recent application. Failure to file an updated application will result in expiration of
the exemption.
559.A.
Bona Fide Hedging Transactions or Positions
The Market Regulation Department may grant exemptions from position limits for bona fide hedging
transactions or positions as defined in CFTC Regulation §150.1.
Approved bona fide hedgers may be exempted from Exchange emergency orders that reduce
position limits or restrict trading.
559.B.
Non-Enumerated Bona Fide Hedging Transactions or Positions
1. Referenced Contracts (as defined in CFTC Regulation §150.1)
The Market Regulation Department may grant exemptions from the position limits for nonenumerated bona fide hedging transactions or positions. For the purposes of this rule, nonenumerated bona fide hedging transactions or positions must meet the definition of a bona fide
hedging transaction or position in CFTC Regulation §150.1. Any position involving a commodity
index contract and one or more referenced contracts will not be recognized as a bona fide hedging
transaction or position pursuant to this Section.
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Page 34 of 50

The Market Regulation Department may grant exemptions from the position limits for nonenumerated bona fide hedging transactions or positions which are held by or on behalf of an entity
or an affiliate of an entity which typically buys, sells or holds positions in the underlying cash market,
a related cash market, or a related over-the-counter market and for which the underlying market has
a high degree of demonstrated liquidity relative to the size of the positions and where there exist
opportunities for arbitrage which provide a close linkage between the futures or options market andthe underlying market in question.
Any position involving swaps (excluding pass-through swaps) or commodity index contracts may berecognized as a bona fide hedging transaction or position pursuant to this Section.
559.C.
Spread Positions
The Market Regulation Department may grant exemptions from the position limits for an intra-market
spread, inter-market spread, intra-commodity spread, and inter-commodity spread, including
calendar spread, quality spread, processing spread, product or by-product spread, or futures-options
spread positions.
559.D.
Aggregation of Positions
For the purpose of applying the position limits in the Table, all positions in accounts for which any
person, by power of attorney or otherwise, directly or indirectly controls trading or holds a 10 percent
of greater ownership or equity interest must be aggregated with the positions held and trading doneby such person. For the purpose of determining the positions in accounts for which any person
controls trading or holds a 10 percent or greater ownership or equity interest, positions or ownershipor equity interests held by, and trading done or controlled by, two or more persons acting pursuant
to an expressed or implied agreement or understanding shall be treated the same as if the positions
were held by, or the trading were done or controlled by, a single person.
Any person that, by power of attorney or otherwise, holds or controls the trading of positions in morethan one account or pool with substantially identical trading strategies, must aggregate all such
positions in accordance with the provisions of CFTC Regulation 150.4(a)(2).
559.E.
Exemptions from Aggregation
Exemptions from aggregation in all products subject to Exchange position limits must comply withthe provisions of CFTC Regulation 150.4(b).
Any person claiming an exemption from Exchange position limits under the provisions of CFTC
Regulation 150.4(b)(1)(ii), (b)(2), (b)(3), (b)(4), or (b)(7) must provide a notice to the Market
Regulation Department which sets forth 1) a description of the relevant circumstances that warrant
disaggregation and 2) a statement by a senior officer or executive of the entity certifying that theconditions set forth in the applicable CFTC aggregation exemption provision have been met.
Upon request by the Market Regulation Department, any person claiming an exemption fromaggregation under this Section E. must provide any requested information that demonstrates the
person meets the applicable requirements for the exemption. Market Regulation, in its sole
discretion, may amend, suspend, terminate, or otherwise modify a person’s exemption fromaggregation for failure to comply with the provisions of this Section E.
In the event of a material change to the information provided in any notice filed under this Section
E., an updated or amended notice must be promptly filed with the Market Regulation Department
detailing the material change.
559.F.
Violations
Violations of position limits and approved exemption limits are subject to the provisions of Rule 562.

560.
60B

POSITION ACCOUNTABILITY
A person who owns or controls positions in excess of reportable levels or where such Person
otherwise holds substantial positions in contracts traded on the Exchange or cleared by the Clearing
House shall keep records, including records of their activity in the underlying commodity and related
derivative markets, and make such records available, upon request, to the Exchange.
Upon request by the Market Regulation Department, such person shall also provide information
relating to the positions owned or controlled by that person including, but not limited to, the natureand size of the position, the trading strategy employed with respect to the position, and hedging
information, if applicable.
For purposes of this rule, all positions in accounts for which a person, by power of attorney orotherwise, directly or indirectly holds positions or controls trading shall be included with the positions© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

Page 35 of 50

held by such person. Additionally, positions held by two or more persons acting pursuant to an
expressed or implied agreement or understanding shall be treated the same as if the positions were
held by a single person.
If the person from whom such records or information is requested fails to comply as directed, theMarket Regulation Department may order the reduction of such position, in addition to taking
disciplinary action as a result of such failure.
A person who exceeds position accountability or position limit levels as a result of maintaining
positions at more than one clearing firm shall be deemed to have waived confidentiality regarding his
position and the identity of the clearing members at which the positions are maintained.
A person who holds or controls aggregate positions in excess of specified position accountability
levels or in excess of position limits pursuant to an approved exemption shall be deemed to haveconsented, when so ordered by the Market Regulation Department, not to further increase thepositions, to comply with any prospective limit which exceeds the size of the position owned orcontrolled, or to reduce any open position which exceeds position accountability or position limit
levels. Any order to reduce an open position shall be issued by the Chief Regulatory Officer or his
designee, if he determines in his sole discretion, that such action is necessary to maintain an orderly
market.
A clearing member that carries positions for another person shall be responsible for taking
reasonable and diligent actions to effect the timely compliance with any order issued pursuant to thisrule upon notification of such order by the Market Regulation Department.
All positions must be initiated and liquidated in an orderly manner.

561.

SUBMISSION OF LARGE TRADER POSITIONS AND VOLUME THRESHOLD
ACCOUNTS
561.A.
Large Trader Reporting
Clearing members, omnibus accounts and foreign brokers shall electronically submit to the Exchangea daily large trader position report of all positions required to be reported as set forth in the Position
Limit, Position Accountability and Reportable Level Table, in the Interpretations Section at the end ofChapter 5.
Positions at or above the reportable level in a particular expiration month of a futures contract, or inall puts or in all calls of a particular option contract expiration month, are required to be reported. For
an account with reportable positions in a particular contract, all positions, regardless of size, in any
contract month and in any contract that aggregates with that contract must be reported.
The daily large trader position report submitted to the Exchange must also include, for eachreportable account, 1) the EFRP volume bought and sold in the reportable instrument, by contract
month, and for EOOs by put and call strike and 2) the number of delivery notices issued and thenumber of deliveries stopped in the reportable instrument.
In addition to the large trader position report, clearing members, omnibus accounts and foreign
brokers must electronically provide the Exchange with the required CFTC Form 102A (“Identificationof Special Accounts”) accurately identifying the owners, controllers, controlled accounts and any
additional information required for each reportable account within three business days of the first day
that the account in question becomes a reportable account. Notwithstanding the three business day
submission requirement, on the first day that an account becomes reportable, clearing members,
omnibus accounts and foreign brokers must, at the direction of the Exchange, provide the following
information: account type, reportable account number and names and addresses of the owners andcontrollers of the account.
The Exchange may require that more than one large trader position report be electronically submitted
daily. The Business Conduct Committee or the Market Regulation Department may require reports
or additional account identification from any clearing member, omnibus account or foreign broker on
a lesser number of positions than reflected in the Position Limit, Position Accountability andReportable Level Table.
If any material change causes the information previously submitted to the Exchange to become
inaccurate, then such clearing member, omnibus account or foreign broker must electronically submit
to the Exchange an updated form reflecting the accurate information within three business days ofsuch changes becoming effective. Additionally, in the absence of any material changes, theExchange may require the electronic submission of a new form on an annual basis for the
maintenance of accurate records. A material change includes, but is not limited to, change of account© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

Page 36 of 50

name, address, controllers or controlled accounts.
561.B.
Volume Threshold Reporting
A volume threshold account is any account that meets the volume threshold of contracts traded in asingle trading day as defined in CFTC Regulation 15.04. Clearing members, shall electronicallysubmit to the Exchange the required CFTC Form 102B (“Identification of Volume Threshold
Accounts”) accurately identifying account information for volume threshold accounts, including theowners, controllers, controlled accounts and any additional information required by the report within
three business days of the first day that the account in question becomes a volume threshold account.
Notwithstanding the three business day submission requirement, on the first day that an accountbecomes reportable, clearing members, omnibus accounts and foreign brokers must, at the directionof the Exchange, provide the following information: account type, reportable account number andnames and addresses of the owners and controllers of the account.
If any material change causes the information previously submitted to the Exchange to be inaccurate,then such clearing member, omnibus account or foreign broker must electronically submit to the
Exchange an updated form reflecting the accurate information within three business days of suchchanges becoming effective. Additionally, in the absence of any material changes, the Exchange
may require the submission of a new form on an annual basis for the maintenance of accurate
records. A material change includes, but is not limited to, change of account name, address,
controllers or controlled accounts.
561.C.
Obligations of Omnibus Accounts and Foreign Brokers
Failure by an omnibus account or foreign broker to submit required information may result in ahearing by the Business Conduct Committee and result in limitations, conditions or denial of accessof such omnibus account or foreign broker to any Exchange market. Notwithstanding the above,clearing members carrying such accounts remain responsible for obtaining and providing to the
Exchange information regarding the ownership and control of positions in circumstances where an
omnibus account or foreign broker has failed to provide the information to the Exchange. Clearing
firms must require their clients to provide accurate and timely owner and control information, including
any material changes.
Upon request from the Exchange, clearing members, omnibus accounts and foreign brokers must
provide CFTC Form 40.
561.D.
Reportable Levels
The large trader reportable levels for all contracts are set forth in the Position Limit, Position
Accountability and Reportable Level Table in the Interpretations Section at the end of Chapter 5.
Any trading account with a trading volume of 50 or more contracts during a single trading day, in aparticular expiration month of a futures contract or in all puts or in all calls of a particular options
contract expiration month is a reportable volume threshold account.
[Notwithstanding the foregoing, please see CFTC No-Action Letter 17-45 issued on September

25, 2017.]
562.
62B

POSITION LIMIT VIOLATIONS
Any positions, including positions established intraday, in excess of those permitted under the rulesof the Exchange shall be deemed position limit violations.
If a position exceeds position limits as a result of an option assignment, the person who owns orcontrols such position shall be allowed one business day to liquidate the excess position without
being considered in violation of the limits. Additionally, if, at the close of trading, a position that
includes options exceeds position limits when evaluated using the delta factors as of that day’s closeof trading, but does not exceed the limits when evaluated using the previous day’s delta factors, thenthe position shall not constitute a position limit violation.
A clearing member shall not be in violation of this rule if it carries positions for its customers in excessof the applicable position limits for such reasonable period of time as the firm may require to discoverand liquidate the excess positions. For the purposes of this rule, a reasonable period of time shallgenerally not exceed one business day.
A customer who exceeds the position limits as a result of maintaining positions at more than one
clearing member shall be deemed to have waived confidentiality regarding his positions and theidentity of the clearing members at which they are maintained. A clearing member carrying such
positions shall not be in violation of this rule if, upon notification by the Market Regulation Department,© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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it liquidates its pro-rata share of the position in excess of the limits or otherwise ensures the customer
is in compliance with the limits within a reasonable period of time. For purposes of this rule, areasonable period of time shall generally not exceed one business day.

563.-69.

[RESERVED]

570.

RESTRICTION ON SALE OF EXCHANGE PRODUCTS IN THE EUROPEAN UNION
TO EUROPEAN UNION RETAIL INVESTORS UNDER PRIIPS [PACKAGE RETAILAND INSURANCE BASED INVESTMENT PRODUCT](a) No member shall offer, sell or arrange a transaction in an Exchange Contract for, on behalf of,or with a retail investor in the European Union (“EU Retail Investor”), or otherwise make an
Exchange Contract available to an EU Retail Investor, unless (1) a key information document(“KID”) has been produced for the product by the Exchange in accordance with the requirementsof Regulation (EU) No 1286/2014 (the "PRIIPs Regulation") and (2) the KID has been provided
to the EU Retail Investor by the intermediary accepting the order from or clearing the transaction
on behalf of the EU Retail Investor.
(b) For the purposes of this rule, “retail investor” shall be defined as any person or entity that does
not qualify as a “professional client” as defined in Directive 2014/65/EU of the European
Parliament and of the Council of 15 May 2014 on markets in financial instruments as may beamended, restated or superseded from time to time.

571.-572.

[RESERVED]GLOBEX ELECTRONIC TRADING SYSTEM RULES
3B

573.
63B

GLOBEX OPENING
Each business day, Globex will open with a single price for each instrument unless otherwise
designated by the Exchange.
Prior to the opening of each Globex Session, Globex will provide an indicative opening price or prices,
based on the Globex equilibrium price algorithm described below, and on all pending orders that may
be executed on the opening. During the 30–second period prior to the opening, no previously enteredorders may be modified or cancelled, although new orders may be entered.
Globex will establish an equilibrium price that will be the opening price. The equilibrium price is thecalculated price between sell pressure and buy pressure where the largest volume of trading canoccur. The price will be determined in accordance with the following methodology:
1. Any bid at a given price may also be executed at a lower price.
2. Any offer at a given price may also be executed at a higher price.
3. The bid volume at any price is the quantity bid at that price plus the sum of the quantities bid at
all higher prices.
4. The offer volume at any price is the quantity offered at that price plus the sum of the quantities
offered at all lower prices.
5. Sell pressure occurs when the offer volume exceeds the bid volume at a particular price.
6. Buy pressure occurs when the bid volume exceeds the offer volume at a particular price.
7. The trade volume at any price is the smaller of the bid volume or the offer volume.
8. The price overlap is the range of prices where trades are possible.
9. The equilibrium is the price range within the price overlap where buy pressure changes to sellpressure.
10. The equilibrium price is one of the following:(a) The price within the equilibrium that has the largest trade volume and the lowest unmatchedvolume at that price remaining after the opening.
or(b) If more than one price has the same trade volume and the same unmatched volume at thatprice, the equilibrium price is the one nearest the previous day's settlement price.
11. If there is no equilibrium (there is only buy pressure or sell pressure), there will be no opening© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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price until a trade occurs unless there is a bid higher than, or an offer lower than, the previous
day's settlement price.
12. After the provisional opening price is determined as set forth above for all orders excluding stopand stop limit orders, the calculations are repeated with any such orders that would be triggeredat such price included until a new provisional opening price is determined. If such new pricewould trigger additional stop or stop limit orders, the process is repeated until no more orders
are triggered.
13. Bids and offers will be selected for matching at the opening price based on price and time priority.

574.

GLOBEX ACCESS RESTRICTIONS

64B

All connections to the Globex system must be guaranteed by a clearing member that assumes
financial responsibility for all activity through the connection. With respect to transactions given up
to other clearing members, such guarantee is effective only until such time that the other clearing
member accepts the trade.
Where required under CFTC regulations, all individuals entering non-member customer orders inother than a clerical capacity must have appropriate CFTC registration. Non-member customer
orders may be entered only from designated areas on the floor of the Exchange, from the premisesof an entity registered to conduct customer business, or any other location designated by such entity.
Clearing members shall assist the Exchange in any investigation into potential violations of the rules
or the Act which occur through or with respect to a Globex connection guaranteed by the clearing
member. Such assistance must be timely and may include, but not be limited to, requiring any Person
to produce documents, to answer questions from the Exchange, and/or to appear in connection withan investigation.
Clearing members shall suspend or terminate a Person’s Globex access if the Exchange determinesthat the actions of the Person threaten the integrity or liquidity of any contract or violate any Exchange
rule or the Act, or if the Person fails to cooperate in an investigation.
If a clearing member has actual or constructive notice of a violation of Exchange rules in connection
with the use of Globex by any Person for which it has authorized a direct connection and the clearing
member fails to take appropriate action, the clearing member may be found to have committed an
act detrimental to the interest or welfare of the Exchange.

575.

DISRUPTIVE PRACTICES PROHIBITED

65B

All orders must be entered for the purpose of executing bona fide transactions. Additionally, all nonactionable messages must be entered in good faith for legitimate purposes.
A. No person shall enter or cause to be entered an order with the intent, at the time of order entry,
to cancel the order before execution or to modify the order to avoid execution;
B. No person shall enter or cause to be entered an actionable or non-actionable message(s) withintent to mislead other market participants;
C.1. No person shall enter or cause to be entered an actionable or non-actionable message(s) withintent to overload or delay the systems of the Exchange or other market participants;
C.2. No person shall intentionally or recklessly submit or cause to be submitted an actionable or nonactionable message(s) that has the potential to disrupt the systems of the Exchange; andD. No person shall enter or cause to be entered an actionable or non-actionable message(s) withintent to disrupt, or with reckless disregard for the adverse impact on, the orderly conduct oftrading or the fair execution of transactions.
To the extent applicable, the provisions of this Rule apply to open outcry trading as well as electronic
trading activity. Further, the provisions of this Rule apply to all market states, including the preopening period, the closing period and all trading sessions.

576.

IDENTIFICATION OF GLOBEX TERMINAL OPERATORS

6B

Each Globex Terminal Operator shall be identified to the Exchange, in the manner prescribed by the
Exchange, and shall be subject to Exchange rules. If operator IDs are required to be registered with
the Exchange, it is the duty of the clearing member to ensure that registration is current and accurate
at all times. Each individual must use a unique operator ID to access Globex. In no event may a
person enter an order or permit the entry of an order by an individual using an operator ID other than
the individual’s own unique operator ID.
67B© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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577.

[RESERVED]

68

578.

LIMITATION OF LIABILITY, NO WARRANTIESA.

EXCEPT AS PROVIDED BELOW, THE EXCHANGE, THE BOARD OF TRADE OF THE CITY
OF CHICAGO, INC. (“CBOT”), THE NEW YORK MERCANTILE EXCHANGE INC. (“NYMEX”)(INCLUDING EACH OF THEIR RESPECTIVE SHAREHOLDERS) ALONG WITH THE
MINNEAPOLIS GRAIN EXCHANGE (“MGEX”) AND ANY OTHER PARTICIPATINGEXCHANGE, (INCLUDING EACH OF THEIR RESPECTIVE SUBSIDIARIES AND
AFFILIATES), THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS,
CONSULTANTS, LICENSORS, MEMBERS, AND CLEARING MEMBERS, SHALL NOT BE
LIABLE TO ANY PERSON FOR ANY LOSSES, DAMAGES, COSTS OR EXPENSES(INCLUDING, BUT NOT LIMITED TO, LOSS OF PROFITS, LOSS OF USE, AND DIRECT,INDIRECT, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES), ARISING FROM:(i)

ANY FAILURE, MALFUNCTION, FAULT IN DELIVERY, DELAY, OMISSION,SUSPENSION, INACCURACY, INTERRUPTION, TERMINATION, OR ANY OTHER
CAUSE, IN CONNECTION WITH THE FURNISHING, PERFORMANCE, OPERATION,
MAINTENANCE, USE OF OR INABILITY TO USE ALL OR ANY PART OF ANY OF THE
SYSTEMS AND SERVICES OF THE EXCHANGE OR SERVICES, EQUIPMENT OR
FACILITIES USED TO SUPPORT SUCH SYSTEMS AND SERVICES, INCLUDINGWITHOUT LIMITATION ELECTRONIC ORDER ENTRY/DELIVERY, TRADING
THROUGH ANY ELECTRONIC MEANS, ELECTRONIC COMMUNICATION OF MARKETDATA OR INFORMATION, WORKSTATIONS USED BY MEMBERS AND AUTHORIZEDEMPLOYEES OF MEMBERS, PRICE REPORTING SYSTEMS AND ANY AND ALL
TERMINALS, COMMUNICATIONS NETWORKS, CENTRAL COMPUTERS, SOFTWARE,
HARDWARE, FIRMWARE AND PRINTERS RELATING THERETO; OR(ii) ANY FAILURE OR MALFUNCTION, FAULT IN DELIVERY, DELAY, OMISSION,SUSPENSION, INACCURACY, INTERRUPTION OR TERMINATION, OR ANY OTHER
CAUSE, OF ANY SYSTEM OR SERVICE OF THE EXCHANGE OR SERVICES,EQUIPMENT OR FACILITIES USED TO SUPPORT SUCH SYSTEMS OR SERVICES,CAUSED BY ANY THIRD PARTIES INCLUDING, BUT NOT LIMITED TO, INDEPENDENTSOFTWARE VENDORS AND NETWORK PROVIDERS; OR(iii) ANY ERRORS OR INACCURACIES IN INFORMATION PROVIDED BY THE EXCHANGE
OR ANY EXCHANGE SYSTEMS, SERVICES OR FACILITIES; OR(iv) ANY UNAUTHORIZED ACCESS TO OR UNAUTHORIZED USE OF ANY EXCHANGESYSTEMS, SERVICES OR FACILITIES BY ANY PERSON.
THE FOREGOING LIMITATION OF LIABILITY SHALL APPLY WHETHER A CLAIM ARISES IN
CONTRACT, TORT, NEGLIGENCE, STRICT LIABILITY, CONTRIBUTION OR OTHERWISE AND
WHETHER THE CLAIM IS BROUGHT DIRECTLY OR AS A THIRD PARTY CLAIM.
THE FOREGOING LIMITATION OF LIABILITY SHALL BE SUBJECT TO THE COMMODITYEXCHANGE ACT AND REGULATIONS THEREUNDER. A PARTY WHO HAS BEEN FINALLYADJUDICATED TO HAVE ENGAGED IN WILLFUL OR WANTON MISCONDUCT MAY NOT AVAILITSELF OF THE PROTECTIONS IN THIS RULE.
B. THERE ARE NO EXPRESS OR IMPLIED WARRANTIES OR REPRESENTATIONS(INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY AND FITNESSFOR A PARTICULAR PURPOSE OR USE) PROVIDED BY THE EXCHANGE, CBOT, NYMEXOR ANY PARTICIPATING EXCHANGE (INCLUDING THEIR RESPECTIVE SUBSIDIARIESAND AFFILIATES), THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS,
CONSULTANTS, AND LICENSORS RELATING TO ANY SYSTEMS OR SERVICES OF THE
EXCHANGE OR SERVICES, EQUIPMENT OR FACILITIES USED TO SUPPORT SUCHSYSTEMS OR SERVICES, INCLUDING THE GLOBEX SYSTEM.
C. ANY DISPUTE ARISING OUT OF THE USE OF SYSTEMS OR SERVICES OF THE
EXCHANGE OR SERVICES, EQUIPMENT OR FACILITIES USED TO SUPPORT SUCHSYSTEMS OR SERVICES IN WHICH THE EXCHANGE (INCLUDING ITS SUBSIDIARIES AND
AFFILIATES), OR ANY OF ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS,
CONSULTANTS OR LICENSORS IS A PARTY SHALL BE ARBITRATED PURSUANT TO© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

Page 40 of 50

EXCHANGE RULES. ANY ARBITRATION SHALL BE BROUGHT WITHIN THE PERIODPRESCRIBED BY EXCHANGE RULES. ANY OTHER ACTIONS, SUITS OR PROCEEDINGSAGAINST ANY OF THE ABOVE MUST BE BROUGHT WITHIN TWO YEARS FROM THE TIME
THAT A CAUSE OF ACTION HAS ACCRUED. THIS PARAGRAPH C SHALL IN NO WAY BE
CONSTRUED TO LIMIT A PARTY’S OBLIGATION TO ARBITRATE ITS CLAIM OR TO
CREATE A CAUSE OF ACTION AND SHALL NOT AUTHORIZE AN ACTION THAT WOULD
OTHERWISE BE PROHIBITED BY EXCHANGE RULES. IF FOR ANY REASON, A COURT
OF COMPETENT JURISDICTION FINDS THAT SUCH DISPUTE IS NOT ARBITRABLE, SUCHDISPUTE MAY ONLY BE LITIGATED IN THE COUNTY OF COOK IN THE STATE OF ILLINOISAND WILL BE GOVERNED BY THE LAWS OF THE STATE OF ILLINOIS WITHOUT REGARDTO ANY PROVISIONS OF ILLINOIS LAW THAT WOULD APPLY THE SUBSTANTIVE LAW
OF A DIFFERENT JURISDICTION.
D. THE EXCHANGE, CBOT AND NYMEX MAY, IN THEIR SOLE DISCRETION, ASSUMERESPONSIBILITY FOR DIRECT, OUT-OF-POCKET LOSSES DIRECTLY CAUSED BY THE
NEGLIGENCE OF GLOBAL COMMAND CENTER OR OTHER EXCHANGE STAFF AND/OR
ORDER STATUS ERRORS PROVIDED BY THE GLOBAL COMMAND CENTER AND/OR THE
CLEARING CUSTOMER SERVICE DESK. IF SUCH LIABILITY IS ACCEPTED, THE TOTALAGGREGATE OBLIGATIONS FOR THE EXCHANGE, CBOT AND NYMEX SHALL NOT
EXCEED $200,000 FOR ALL LOSSES SUFFERED FROM ALL CAUSES IN A SINGLE
CALENDAR MONTH, EXCEPT FOR LOSSES CAUSED BY PHANTOM ORDERS WHICH ARE
SUBJECT TO THE PROVISIONS OF PARAGRAPHS F. AND G. BELOW. ANY DISPUTED
CLAIM MADE UNDER THIS RULE MUST BE ARBITRATED PURSUANT TO EXCHANGE
RULES.
E. IN NO EVENT SHALL THE COLLECTIVE TOTAL AGGREGATE LIABILITY FOR THE
EXCHANGE, CBOT AND NYMEX FOR ALL CLAIMS ARISING OUT OF ANY NEGLIGENCE,
FAILURES, MALFUNCTIONS, FAULTS IN DELIVERY, DELAYS, OMISSIONS,SUSPENSIONS, INACCURACIES, INTERRUPTIONS, TERMINATIONS, ORDER STATUSINGERRORS OR ANY OTHER CAUSES, EXCEPT FOR PHANTOM ORDERS WHICH ARE
SUBJECT TO THE PROVISIONS OF PARAGRAPHS F. AND G. BELOW, IN CONNECTION
WITH THE FURNISHING, PERFORMANCE, OPERATION, MAINTENANCE, USE OF OR
INABILITY TO USE ALL OR ANY PART OF ANY OF THE EXCHANGE’S SYSTEMS ORSERVICES, OR SERVICES, EQUIPMENT OR FACILITIES USED TO SUPPORT SUCHSYSTEMS AND SERVICES, OR THE NEGLIGENCE OF EXCHANGE STAFF, EXCEED$200,000 IN ANY CALENDAR MONTH.
IF THE NUMBER OF ALLOWED CLAIMS ARISING OUT OF ANY FAILURES OR
MALFUNCTIONS IN A SINGLE CALENDAR MONTH CANNOT BE FULLY SATISFIEDBECAUSE OF THE MONTHLY LIABILITY LIMITATION, ALL SUCH CLAIMS SHALL BE
LIMITED TO A PRO RATA SHARE OF THE MAXIMUM AMOUNT AVAILABLE FOR THATMONTH.
F. NOTWITHSTANDING THE FOREGOING, THE EXCHANGE, CBOT AND NYMEX MAY, IN
THEIR SOLE DISCRETION, ASSUME RESPONSIBILITY FOR DIRECT, OUT-OF-POCKETNET LOSSES DIRECTLY CAUSED BY PHANTOM ORDERS (AS DEFINED BELOW). IF
SUCH LIABILITY IS ACCEPTED, THE TOTAL AGGREGATE OBLIGATIONS FOR THE
EXCHANGE, CBOT AND NYMEX SHALL NOT EXCEED $5,000,000 FOR ALL SUCH LOSSESSUFFERED IN A SINGLE CALENDAR MONTH. ANY DISPUTED CLAIM MADE UNDER THISRULE MUST BE ARBITRATED PURSUANT TO EXCHANGE RULES.
FOR THE PURPOSES OF THIS RULE AND RULE 588, A PHANTOM ORDER IS AN ORDER:
1) THAT WAS NOT AUTHORIZED BY A PERSON BUT WAS CAUSED BY A FAILURE,
MALFUNCTION OR NEGLIGENT OPERATION OF GLOBEX OR ANY OTHER EXCHANGESYSTEM, SERVICE OR FACILITY, OR 2) WHOSE TERMS (E.G. CONTRACT, CONTRACTMONTH, QUANTITY, PRICE OR DIRECTION) WERE CHANGED WITHOUTAUTHORIZATION OF THE PERSON PLACING THE ORDER SOLELY AS A RESULT OF A
FAILURE, MALFUNCTION, OR NEGLIGENT OPERATION OF GLOBEX OR ANY OTHER
EXCHANGE SYSTEM, SERVICE OR FACILITY.
G. IN NO EVENT SHALL THE COLLECTIVE TOTAL AGGREGATE LIABILITY FOR THE
EXCHANGE, CBOT AND NYMEX FOR DIRECT, OUT-OF-POCKET NET LOSSES DIRECTLY
CAUSED BY PHANTOM ORDER(S) EXCEED $5,000,000 IN A SINGLE CALENDAR MONTH.
COMPLIANCE WITH THE TERMS OF RULE 588.F. IS REQUIRED IN ORDER FOR LOSSES© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

Page 41 of 50

TO BE CONSIDERED BY THE EXCHANGE PURSUANT TO THIS RULE.
IF THE AMOUNT OF DIRECT, OUT-OF-POCKET NET LOSSES DIRECTLY CAUSED BY
PHANTOM ORDERS IN A SINGLE CALENDAR MONTH CANNOT BE FULLY SATISFIEDBECAUSE OF THE MONTHLY LIABILITY LIMITATION, ALL SUCH LOSSES SHALL BE
LIMITED TO A PRO RATA SHARE OF THE MAXIMUM AMOUNT AVAILABLE FOR THATMONTH.
A CLAIM AGAINST THE EXCHANGE, CBOT OR NYMEX ARISING OUT OF ANY FAILURE,
MALFUNCTION OR PHANTOM ORDER SHALL BE STRICTLY SUBJECT TO THE RESPECTIVE
LIABILITY LIMITS OF THIS RULE.

GLOBAL COMMAND CENTER (“GCC”)

579.
69B

579.A.
GCC Authority
The GCC has the authority to take any action deemed appropriate to preserve market integrity in
CME Group markets. Such actions include, but are not limited to, the halting of trading, modifying
risk-mitigating parameters including price bands, velocity logic and special price fluctuation limits as
described in Rule 589, restricting customer access to Globex or any other actions deemed to be in
the best interest of the Exchange. In the event any action taken pursuant to this Rule is in responseto an emergency as defined in CFTC Regulation 40.1(h), the CFTC shall be notified of the emergency
action in accordance with CFTC Regulations.
579.B
GCC Services
The GCC provides production support and problem management to all market participants. In
addition to this support, the GCC also provides critical assistance to registered contacts. Criticalassistance includes, but is not limited to, inquiries and/or actions involving order status and ordercancellations. Exchange liability for GCC services is subject to the limitations and conditions of Rule
578.
579.C
Order Status
A person who believes he has received an incorrect order status or does not receive an appropriate
status shall immediately notify the GCC. In the event that the GCC and an Exchange system, service
or facility provide conflicting information relating to an order status, a person may only reasonably
rely on the information received from the GCC. Additionally, such person shall take any necessary
and appropriate market action to mitigate any potential losses arising from the incorrect order status
or lack of appropriate order status immediately after the person knew or should have known that theorder status information was incorrect or should have been received.
135B

136B

580.

CME GLOBEX TRADE MATCHING ALGORITHMS

70B

The CME Globex platform employs multiple predefined sets of matching algorithms used to match
trades on the platform. Information concerning the matching algorithm applicable to a particular
product is set forth on the GCC Product Resources page on the CME Group website available here.
Information on the operation of the matching algorithms is available here.
H

581.-582.

[RESERVED]

583.

DOMESTIC CROSS-EXCHANGE TRADING

71B

72B

583.A.

Cross-Exchange Trading by Members of Other Domestic Exchanges inContracts Listed on Globex
Individual members and clearing members of another domestic exchange that is participating incross-exchange trading through Globex are eligible to obtain cross-exchange access, for proprietaryand customer trading activity, to the contracts listed on Globex. The contracts may be listed on
Globex either by the CME (“CME contracts”) or by a domestic exchange other than CME (“Domestic
Exchange contracts”). Such members and clearing members must (1) be authorized by CME toenter orders in CME contracts or Domestic Exchange contracts, as applicable, through Globex, (2)make an arrangement with an appropriate clearing member to clear any trades in CME contracts, (3)make an arrangement with a clearing member of the domestic exchange to clear any trades in such
Domestic Exchange’s contracts, and (4) abide by the Globex trading rules, policies and proceduresof CME when trading CME contracts and Domestic Exchange contracts through Globex.
When an individual member or clearing member of a domestic exchange is found to have violated
CME’s Globex trading rules, CME may deny or suspend the privilege of cross-exchange trading of
139B© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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such individual member or clearing member.
583.B.
Cross-Exchange Trading by Members of CME in Contracts Listed on Globex or
Other Electronic Trading Systems by Participating Domestic Exchanges
Individual members and clearing members of CME may obtain cross-exchange access, forproprietary and customer trading activity, to Domestic Exchange contracts listed on Globex or thecontracts of a domestic exchange listed on such domestic exchange’s electronic trading system.
Such members and clearing members must (1) be authorized by the domestic exchange to enter
orders in that exchange's contracts either through Globex or through such domestic exchange’s
electronic trading system, (2) make an arrangement with a clearing member of such domestic
exchange to clear any trades in Domestic Exchange contracts listed on Globex or contracts listed bythat domestic exchange on its electronic trading system, and (3) abide by the Globex trading rules,
policies and procedures when trading Domestic Exchange contracts listed by that domestic
exchange on Globex or the rules of the domestic exchange when trading contracts on such domestic
exchange’s electronic trading system.
140B

584.-587.

[RESERVED]

73B

74B

75

588.

TRADE CANCELLATIONS AND PRICE ADJUSTMENTS

76B

588.A.

Global Command Center Authority Regarding Trade Cancellations and Price
Adjustments
The following shall be applied to balance the adverse effects on market integrity of executing tradesand publishing trade information inconsistent with prevailing market conditions while preserving
legitimate expectations of trade certainty by market participants. This rule authorizes the Global
Command Center (“GCC”) to adjust trade prices or cancel trades where, in its absolute and sole
discretion, the GCC believes such action is necessary to mitigate market disrupting events causedby the improper or erroneous use of the electronic trading system or by system defects.
Notwithstanding any other provisions of this rule, the GCC may, in its absolute and sole discretion,
adjust trade prices or cancel any trade if it believes that allowing the trade(s) to stand as executed
could have a material, adverse effect on the integrity of the market. All decisions of the GCC shallbe final. Subject to the limitations and conditions of Rule 578, and irrespective of the terms of any
order entered into Globex, the Exchange shall not have any liability for losses resulting from priceadjustments or trade cancellations by the GCC under this Rule.
588.B.
Review of Trades
The GCC may determine to review a trade based on its independent analysis of market activity or
upon request for review by a user of the electronic trading system. A request for review must be
made to the GCC via telephone within eight minutes of the execution of the trade. Any other form ofcommunication with the GCC will not constitute a request for review as set forth in this Section. GCC
phone numbers are available on the CME Group website.
The GCC shall determine whether or not a trade will be subject to review. In the absence of a timely
request for review, during volatile market conditions, upon the release of significant news, or in any
other circumstance in which the GCC deems it to be appropriate, the GCC may determine, in its sole
discretion, that a trade shall not be subject to review.
Upon deciding to review a trade, the GCC will promptly issue an alert indicating that the trade isunder review.
588.C.
Price Adjustments and Cancellations
Upon making a determination that a trade will be subject to review, the GCC will first determine
whether the trade price is within the Non-Reviewable Range, as described in Section H. In applying
the Non-Reviewable Range, the GCC shall determine the fair value market price for that contract at
the time the trade under review occurred. The GCC may consider any relevant information, including,but not limited to, the last trade price in the contract or a better bid or offer price on the electronic
trading system, a more recent price in a different contract month, the price of the same or related
contract established in another venue or another market, the market conditions at the time of the
trade, the theoretical value of an option based on the most recent implied volatility and responses toa Request for Quote (RFQ).
1. Trade Price Inside the Non-Reviewable Range
If the GCC determines that the price of the trade is inside the Non-Reviewable Range, the GCC
14B

145B

146B

© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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will issue an alert indicating that the trade shall stand.
Trade Price Outside the Non-Reviewable Range
If the GCC determines that a trade price is outside the Non-Reviewable Range the trade priceshall be adjusted to a price that equals the fair value market price for that contract at the time
the trade under review occurred, plus or minus the Non-Reviewable Range. In the event there
are multiple parties, prices and/or contracts involved in the transactions at issue, the GCC has
the authority, but not the obligation, to cancel rather than price adjust such transactions. The
GCC will issue an alert regarding its decision.
Cancelled trade prices and any prices that have been adjusted shall be cancelled in the Exchange’s
official record of time and sales. Trades that are price adjusted shall be inserted in the time andsales record at the adjusted trade price.
588.D.
Alternative Resolution by Agreement of Parties
If the GCC determines that the price of a trade is inside the Non-Reviewable Range, no alternative
action may be taken under this Rule by the parties to the trade.
With the approval of the GCC, parties to a trade that is price adjusted may instead mutually agree tocancel the trade. With the approval of the GCC, parties to a trade that is cancelled may instead
mutually agree to price adjust the trade to a price consistent with the adjustment provisions of Section
C.
Parties to a trade that is cancelled or price adjusted may mutually agree to a cash adjustment
provided that such adjustments are reported to the GCC and the parties maintain a record of theadjustment.
A trade that is not cancelled may not be reversed via a prearranged offsetting transaction unlesssuch transactions are permitted and effected in accordance with Rule 539.C.
588.E.
Liability for Losses Resulting from Price Adjustments or Cancellations andProhibition on Claims for Losses Arising From Error Trades Executed
Within the Non-Reviewable Range
A party entering an order that results in a price adjustment or trade cancellation shall be responsiblefor demonstrated claims of realized losses incurred by persons whose trade prices were adjusted orcancelled provided, however, that a claimant shall not be entitled to compensation for losses incurred
as a result of the claimant’s failure to take reasonable actions to mitigate the loss.
A claim for a loss pursuant to this section must be submitted to the Exchange on an Exchange claim
form within five business days of the event giving rise to the claim. The Exchange shall reject any
claim that is not filed in a timely manner or is not permitted by this section and such decisions shallbe final. Eligible claims shall be forwarded by the Exchange to the party responsible for the order(s)that resulted in a trade cancellation or a price adjustment and to the clearing member through which
the trade was placed. Such party, or the clearing member on behalf of the party, shall, within ten
business days of receipt of the claim, admit or deny responsibility in whole or in part. Failure to
respond to the claim within ten business days shall be considered a denial of liability.
To the extent that liability is admitted, payment shall be made within ten business days. Unlessotherwise agreed upon in writing by the parties, failure to make the payment within ten business days
shall be considered a denial of liability for purposes of this rule. A copy of any such written agreement
must be provided to the Exchange.
To the extent that liability is denied, the party making the claim may submit the claim to arbitration inaccordance with Rule 622. Such claims must be submitted to the Market Regulation Department
within ten business days of the date the party was issued notification that liability was denied.
Claims for losses incurred as a result of trades executed in error at prices within the non-reviewable
range may not be submitted for arbitration pursuant to the provisions of Chapter 6.
588.F.
Permissible Responses to Phantom Orders
If the GCC has reason to believe that Phantom Orders as defined in Rule 578 have been or are being
entered into any Exchange system, service or facility, the GCC shall be empowered to takeappropriate action to protect the integrity of the market, including, without limitation, suspending
trading and/or canceling unfilled orders. The GCC shall also be empowered, in its sole discretion, tocancel transactions, or adjust the trade prices of transactions that were directly or indirectly causedby Phantom Orders, whether or not such transactions were executed at prices outside of the nonreviewable range specified in this Rule.
2.

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If Phantom Orders directly cause transactions to be executed on any Exchange system, service or
facility and such transactions are not canceled, the GCC shall promptly direct the clearing member
carrying positions resulting from such transactions to liquidate the positions in a commerciallyreasonable manner. Such positions shall be liquidated within 30 minutes of such notification or within
30 minutes of the time the clearing firm knew or should have known that it had been assigned
transactions resulting from Phantom Orders, whichever is sooner. The GCC, in its sole discretion,
may waive the 30 minute liquidation requirement if it determines that such requirement may have amaterial, adverse impact on the integrity of the market.
The GCC shall provide notification to the marketplace regarding any action taken or to be taken withrespect to the entry of Phantom Orders or execution of a transaction as a result of Phantom Orders,
and, in the event transactions are not otherwise canceled or price adjusted by the GCC, any actions
required to be taken by clearing members. Such notification(s) shall be made as soon as practicable,
but in no event more than 30 minutes after the time that the GCC has accurate information regarding
the Phantom Orders that is sufficient to support the necessary notification(s).
Any Exchange, CBOT or NYMEX liability for losses resulting from Phantom Orders shall be subject
to the limitations of Rule 578.
588.G.
Schedule of Administrative Fees
When GCC cancels or price adjusts a trade, the party responsible for entering the order into theelectronic trading system that gave rise to the trade cancellation or price adjustment shall pay an
administrative fee to the Exchange in the amount of $1,000 for each such occurrence. If the party is
not deemed a Member as defined in Rule 400 and fails to pay the fee, the clearing member throughwhich the trade was placed shall be responsible for payment of the fee. Administrative fees for thisRule are set forth in the Rule 588.H. table.
588.H.
Globex Non-Reviewable Trading Ranges
View table here (XLS)
Partner Exchanges
Please access below links for Non-Reviewable Ranges for our Partner Exchange contracts.
MGEX - http://www.mgex.com/nrr.html
BMD - http://www.bursamalaysia.com/market/derivatives/trading/trading-parameters/
DME - http://www.dubaimerc.com/no-bust-ranges
76B

589.

SPECIAL PRICE FLUCTUATION LIMITSThe special price fluctuation limits, including dynamic price fluctuation limits, applicable to thosecontracts with such limits are set forth in the Special Price Fluctuation Limits and Daily Price Limits
Table (“Table”) in the Interpretations Section at the end of Chapter 5.
589.A.
Initial Price Fluctuation Limits for All Contract Months
At the commencement of each trading day, there shall be initial price fluctuation limits in effect foreach futures contract month of the primary futures contract (as identified in the Table) above or below
the previous day’s settlement price for such contract month set at the first special price fluctuation limit
level as provided in the Table.
589.B.
Triggering Events and Temporary Trading Halts
1. First Triggering Event and Temporary Trading Halt
If the lead contract month (as identified by the Exchange) of the primary futures contract is bid oroffered via Globex at the upper or lower price fluctuation limit at the first special price fluctuation limit
level, as applicable, it will be considered a triggering event that will begin a two (2) minute monitoring
period in the lead contract month. If, at the end of the two (2) minute monitoring period, the leadcontract month of the primary futures contract is not bid or offered at the applicable special pricefluctuation limit, the special price fluctuation limits shall be expanded an additional increment aboveand below the previous day's settlement price for all contract months of the primary futures contract
and all contract months of associated products of the primary futures contract as provided in the Table.
If, however, at the end of the two (2) minute monitoring period, the lead contract month of the primary
futures contract is bid or offered at the applicable special price fluctuation limit, a two (2) minutetemporary trading halt will commence in all contract months of the primary futures contract and in allcontract months of associated products of the primary futures contract as provided in the Table. In
addition, trading in any associated product that is an option related to the primary futures contract or© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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in an option contract related to any other associated product of the primary futures contract that may
be available for trading on Globex or on the trading floor shall be subject to a coordinated temporary
trading halt.
2. Expansion of Limits Following Temporary Trading Halt
Following the end of a temporary trading halt, the affected markets shall re-open simultaneously in allcontract months of the primary futures contract and in all contract months of associated products ofthe primary futures contract. When trading resumes, the special price fluctuation limits shall be
expanded an additional increment above and below the previous day's settlement price for all contract
months of the primary futures contract and all contract months of associated products of the primary
futures contract as provided in the Table.
In each instance in which a triggering event occurs, a two (2) minute monitoring period will commence
as provided in Section B.1. of this Rule. In each instance, the special price fluctuation limits shall be
expanded by an additional increment above and below the previous day's settlement price for all
contract months of the primary futures contract and all contract months of associated products of the
primary futures contract as provided in the Table. Following the fourth triggering event on a trading
day, there shall be no further special price fluctuation limits.
589.C.
Price Fluctuation Limits on Trading Floor (Floor Trading)
The special price fluctuation limits cited in Section A. of this Rule shall be applicable to all products in
the Table that are traded via open outcry on the trading floor. Trades occurring via open outcry on the
trading floor shall not constitute a triggering event for purposes of a temporary trading halt.
In all instances in which a temporary trading halt in the lead contract month of the primary futurescontract occurs on Globex, floor trading in all contract months in any option related to the primary
futures contract or in an option contract related to any associated product of the primary futurescontract shall be subject to a coordinated temporary trading halt.
Whenever Globex markets are re-opened with expanded price limits pursuant to the provisions ofSection B. of this Rule, the affected markets on the trading floor shall simultaneously re-open withexpanded price limits.
589.D.
Dynamic Price Fluctuation Limits
At the commencement of each trading day, the subject contracts, as designated in the Table, shallbe assigned a price limit variant which shall equal a percentage of the prior trading day’s Exchangedetermined settlement price, or a price deemed appropriate by the GCC, (“dynamic variant”). During
the trading day, the dynamic variant shall be applied in rolling 60-minute look-back periods toestablish dynamic lower and upper price fluctuation limits as follows:(a) the dynamic variant shall be subtracted from the highest trade and/or bid price during a lookback period to establish the lower price fluctuation limit, i.e., trade and/or offer, and(b) the dynamic variant shall be added to the lowest trade and/or offer price during a look-backperiod to establish the upper price fluctuation limit, i.e., trade and/or bid.
1. Triggering Eventsand Temporary Trading Halts
If the lead contract month (as identified by the Exchange) of the primary futures contract is traded,bid or offered on Globex at a price below the lower or above the upper dynamic price fluctuation limit,
it shall be considered a triggering event which shall begin a two (2) minute temporary trading halt inall contract months of the primary futures contract and in all contract months of associated productsof the primary futures contract as provided in the Table. If a non-lead contract month of the primary
futures contract is traded, bid or offered on Globex at a price below the lower or above the upper
dynamic price fluctuation limit, it shall be considered a triggering event which shall begin a two (2)minute temporary trading halt in that non-lead contract month of the primary futures contract.
2. Limits Following Temporary Trading Halt
Following the end of a temporary trading halt triggered by the lead contract month, the affectedmarkets shall re-open simultaneously at the indicative opening price as determined by the Exchange
in all contract months of the primary futures contract and in all contract months of the associatedcontracts of the primary futures contract as provided in the Table. When trading resumes, thedynamic lower and upper price fluctuation limits shall be recalculated as described above. Following
the end of a temporary trading halt triggered by a non-lead contract month, the affected market shallre-open at the indicative opening price as determined by the Exchange and the dynamic lower andupper price fluctuation limits shall be recalculated as described above.
3. Additional Characteristics© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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On each trading day, should there be a triggering event in the lead contract month of the primary
futures contract during such contract’s settlement determination period, there shall be a (5) fivesecond temporary trading halt in all contract months of the primary futures contract and in all contract
months of associated products of the primary futures contract as provided in the Table. If a non-leadcontract month of the primary futures contract, or any contract month of an associated product of the
primary futures contract, experiences a triggering event during the primary futures contract’s
settlement determination period, there shall be a (5) five second temporary trading halt for that nonlead contract month or that contract month of an associated product of the primary contract.
Should there be a triggering event during the final settlement determination period in an expiring
futures contract, there shall be a (5) five second temporary trading halt in that contract month.
On each trading day, should there be a triggering event in the lead contract month of the primary
futures contract during the (2) two-minute period preceding the close of trading, there shall be a (5)five second temporary trading halt in all contract months of the primary futures contract and in allcontract months of associated products of the primary futures contract as provided in the Table. If a
non-lead contract month of the primary futures contract, or any contract month of an associatedproduct of the primary futures contract, experiences a triggering event during the (2) two-minuteperiod preceding the close of trading of the primary futures contract, there shall be a (5) five second
temporary trading halt for that non-lead contract month or that contract month of an associatedproduct of the primary contract.

POSITION LIMIT, POSITION ACCOUNTABILITY AND REPORTABLE LEVEL TABLE
View table here (XLS)
SPECIAL PRICE FLUCTUATION LIMITS AND DAILY PRICE LIMITS TABLE
View table here (XLS)
TRADING AT SETTLEMENT (“TAS”), BASIS TRADE AT INDEX CLOSE (“BTIC”), BASIS TRADE AT CASH
OPEN (“TACO”) AND TRADE MARKER AT CLOSE (“TMAC”) TABLE
View table here (XLS)
RULE 539.C. CROSSING PROTOCOLS TABLE
View table here (XLS)
INTERPRETATIONS & SPECIAL NOTICESRELATING TO CHAPTER 5

ACCESS, CONDUCT AND APPEARANCE CODE
It is imperative that persons who utilize the Exchange Trading Floors (“trading floor”) maintain a proper andbusinesslike atmosphere on the trading floor. This is not only for the benefit of the thousands of visitors (ranging
from U.S. government officials to foreign dignitaries to the general public) who come to the Exchange each year,
but also to maintain and enhance the reputation and dignity of the Exchange as an international marketplace.
Accordingly, the Exchange has established rules governing access to and conduct on the trading floor as well as
standards of appearance. These rules and standards apply to members and their employees, member firm
employees, Exchange employees and visitors.
I.
Access
A. To gain access to the trading floor, every member, member's employee, member firm employee, and© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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II.

III.

Exchange employee must use only his own personal access card to gain access to the trading floor.
Exchange trading floor employees, other Exchange employees routinely on the trading floor and members
must display their personal access card or their Exchange issued identification badge. Non-member
employees of members and member firms must display their personal access cards on the upper front of
their jackets with the picture side facing outward. Broker assistants must also wear a badge provided by
the Exchange that identifies them as broker assistants.
B. Members are required to register and accompany their visitors and are responsible for their actions
while they are on the trading floor. Visitors must wear appropriate attire that is clean and presentable andare not allowed in any pit during trading hours. Visitors' overcoats, packages, umbrellas or briefcases
are not permitted on the trading floor.
C. All visits by public figures to CME Group trading floors, offices and common areas must be approvedand coordinated, in advance, by CME Group’s Public Affairs or Government Relations Department.
Public figures include government officials and representatives, domestic and foreign dignitaries,
politicians, celebrities, business leaders and all other high-profile individuals.
D. Members may not request trading floor access privileges for the same visitor on more than threedays of the same calendar month without the permission of designated Exchange staff of the Security
Department.
E. Visitors are prohibited from soliciting employment or from acting as employees of members, member
firms or the Exchange on the trading floor.
F. No one under the age of 16 will be admitted to the trading floor during trading hours.
Conduct
Commonly accepted standards of propriety and decorum apply to everyone on the trading floor. The
following behavior, speech or actions are expressly prohibited on the trading floor.
A. Possessing any weapon (including, but not limited to, firearms, knives, stun guns or pepper spray);
B. Carrying or consuming food or drink. Individually-wrapped (non-chocolate) hard candy and gum,however, are permissible.
C. Reckless throwing of trading cards or any other material;
D. Excessive speed in moving around the trading floor;
E. Use of emergency exits without proper justification;
F. Smoking or use of tobacco products, including chewing tobacco;
G. Use of members-only facilities by non-members;
H. Failure to give member priority to quotation machines, news tickers, monitors and other facilities
where such member priority is so designated;
I. Engaging in any activity that is disruptive to trading;
J. The sale or solicitation of goods or services without consent of the Exchange;
K. Having outer coats or umbrellas on the trading floor;
L. Use of cameras or video equipment, unless authorized by the Exchange. Flash photography,
however, is never permitted.
In addition, the following activities are prohibited anywhere on Exchange premises:
M. Any behavior, speech or actions that are detrimental to the interests and good name of the Exchange(this includes any conduct which is a violation of any local, state or federal law);
N. Profanity, vulgarity (including wearing buttons with crude or offensive slogans or pictures) or any
speech or action that tends to intimidate, degrade or endanger others;
O. Defacing or otherwise damaging: 1) an Exchange-issued badge or jacket; 2) Exchange facilities orproperty; or 3) any facility or property regardless of ownership;
P. Possessing a firearm or other weapon;
Q. Discarding refuse on escalators or in elevators or in hallways or lobbies; andR. Harassment related to race/color, sex/gender, sexual orientation, age, religion, veteran status,
national origin and disability/medical condition is expressly prohibited.
Appearance
A. All apparel should be neat, clean, presentable and in keeping with the businesslike atmosphere of
the trading floor.

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B.

IV.

Jackets: Where required, every member, member's employee, member firm employee andExchange trading floor employee must wear a jacket provided by the Exchange or their employer,
or, in the case of members, a jacket of their own choosing. All jackets must conform to Exchange
standards. Guests may not wear trading jackets on the trading floor during trading hours.
C. Shirts: All men must wear shirts with a collar suitable for a necktie or bow tie. Shirts must be buttoned
to at least the second button from the collar. Golf-type shirts are permitted. Shirttails must be tucked
in. Turtleneck sweaters are not allowed for men. Crewneck sweaters are allowed if a conventional
collar suitable for a necktie or bow tie is visible. Sweatshirts, tie-dye shirts and T-shirts are prohibited.
D. Shoes: Shoes must be clean, safe and not torn or frayed. The following footwear is specificallyprohibited: all shoes without backs, canvas slippers, moccasins, rubber boots, rubber overshoes,
clogs, bedroom slippers, and shoes with platforms over 2 inches. All shoes must be tied with laces
or appropriately fastened.
E. Pants: The following pants are specifically prohibited: blue jeans, shorts and sweat pants. Tightfitting stretch pants are allowed only when worn with blouse or shirt at mid-thigh or lower.
F. Skirts and dresses: Skirts and dresses must reach mid-thigh or lower.
G. Headwear: All headgear or head coverings are prohibited, except for religious or medical reasons.
H. Miscellaneous: The following are specifically prohibited: sunglasses, ornaments, pendants or similar
items that are distracting or unbusinesslike. Clothing or accessories that draw unusual attention will
be deemed unbusinesslike and not permitted on the trading floor.
Drug and Alcohol Abuse
In order to maintain a safe, healthful, and productive working environment, the Exchange has establishedthe following policy prohibiting drug and alcohol use on Exchange premises.
The following activities are prohibited and may result in disciplinary action, including immediate andpermanent bar of access to Exchange premises:
A. Possession of open containers or use of alcohol, except as expressly authorized by the
Exchange.
B. Being under the influence of alcohol on Exchange premises.
C. Use, sale, purchase, transfer, or possession of any illegal drug on Exchange premises.
D. Failure on the part of non-members to submit to a reasonable search by authorized Exchange
personnel of lunch boxes, bags, parcels, packages, purses, briefcases, pockets or coats, etc.
Members and Member Firms are responsible for their employees’ strict adherence to these requirements.

QUOTATION CHANGESI.

GENERAL PROCEDURES
A. Corrections requested up to 15 minutes from the time the bid, offer or trade occurred or reportedly
occurred: Changes must be authorized by a member of the Pit Committee or an Exchange Official.
B. Corrections requested more than 15 minutes from the time the bid, offer or trade occurred orreportedly occurred: Changes must be authorized by:
1. 15-30 Minutes: A member of the Pit Committee and one Exchange Official.
2. Over 30 Minutes: A member of the Pit Committee, a member of the Floor Conduct Committee
and a Senior Exchange Official.
C. Unanimous Approval Required: Unanimous approval among the individuals participating in the quotechange consideration is required to effectuate the requested change. In the absence of unanimity,
the proposed quote adjustment shall not be made.
D. A request for a quote change which results in a new high or low for the day must be made within 5
minutes (futures) or 10 minutes (options) of the time the bid, offer or trade occurred or reportedly
occurred.
A request for a quote change which affects an established opening range must be made within 15
minutes after the posting of the range, or, in the case of a request for a quote change which affects
an established closing range, within 10 minutes of the posting of the closing range. Such requests
shall be considered by a member of the Pit Committee, a Floor Conduct Committee member and a
Senior Exchange Official. Failure to make such a timely request will bar consideration of the quotechange. The time limitations described in this Section D will not apply in the case of options strikes
or futures contracts deemed by a Senior Exchange Official to be inactive or illiquid or in the case of© Copyright Chicago Mercantile Exchange, Inc. All rights reserved.

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II.

III.

IV.

a fast market designation. These requests may be considered by a member of the Pit Committee, aFloor Conduct Committee member and a Senior Exchange Official at any time during the same day’s
trading session.
E A decision to adjust a quote must be made within 15 minutes after a quote change request has beenmade. However, in the event a fast market has been declared while the quote adjustment is underconsideration, the period for consideration may continue for 15 minutes after the end of the fast
market. To the extent practicable, quote change adjustments shall be announced to the pit.
F. Reconsideration: Once a request for a particular quote change has been resolved, or if no decision
is reached within the allotted time pursuant to paragraph 5 above, a subsequent request forreconsideration involving the original quote or adjustment may be considered if a Senior Exchange
Official deems that new relevant information pertaining to the original request is now available. Such
request for reconsideration must be considered by the same individuals who ruled on, or failed toreach a timely resolution of, the original request. In the event one or more of the individuals who
participated in the consideration of the original quote change request is unavailable to consider therequest for reconsideration, a Senior Exchange Official shall designate a substitute. However, thisreconsideration process may not be utilized for a correction involving a quote change which results
in a new high or low for the day, with the exception of option strikes or futures contracts deemed bya Senior Exchange Official to be inactive or illiquid, or in declared fast markets.
G. Requests for Next Day Corrections
If an outright options or options spread or combination quote has been inadvertently omitted from theprice reporting system and such omission is not discovered until after the trading session, trades may
be allowed to clear at the omitted price at any time prior to the opening of the affected market thenext day, provided that all of the following requirements are satisfied:
1. The parties to the trade can reasonably show that they properly reported the trade price and hada reasonable basis for believing that the trade price would be posted;
2. The parties to the trade produce documentation of: a) the contemporaneous recordation of the
trade; b) the confirmation of the trade to the customer of the member firm representing the order;and c) the submission of the trade to the Exchange Clearing House and its failure to clear the
trade due to a price edit;
3. The change is authorized by a Senior Exchange Official; and4. The change is documented pursuant to Section II.B below.
DOCUMENTATION NEEDED FOR QUOTATION CHANGES
A. In the case of quote changes requested pursuant to Section I.A., a record shall be made of allcommittee members or Exchange employees approving the quote change and the change will berecorded on Time and Sales.
B. In the case of quote changes requested pursuant to Section I.B.1., a hard copy record of the quotechange shall be made by Exchange staff. The individuals approving the change shall promptly sign
the record. The record shall be time-stamped upon request and again upon approval and shall
include the reason for the change, and, in the case of a quote change requested pursuant to Section
I.B.2., the reason for the delay. For all approved quotation changes other than next day corrections
pursuant to Section I.G above, the quotation change will be recorded on Time and Sales.
CONFLICTS OF INTEREST
No individual may authorize any quotation change, insertion or cancellation if such individual has apersonal or financial interest in such change, insertion or cancellation.
AUTHORITY OF SENIOR EXCHANGE OFFICIALS WITH RESPECT TO QUOTATION CHANGES
Senior Exchange Officials may review and authorize any request for a quotation change in circumstanceswhere the individuals specified in Sections I and II are otherwise not available or where the change is notencompassed by Section I or II. Notwithstanding the procedures set forth in Sections I and II, Senior
Exchange Officials are empowered to authorize or deny any requested change only in circumstanceswhere such action is necessary to ensure the integrity or promote the orderly functioning of the market.
Such decisions by Senior Exchange Officials shall be documented and signed by the Senior Exchange
Official and except for next day corrections pursuant to Section I.G above, the quotation change will berecorded on Time and Sales.

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