[Federal Register Volume 69, Number 244 (Tuesday, December 21, 2004)]
[Rules and Regulations]
[Pages 76392-76401]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-27750]


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COMMODITY FUTURES TRADING COMMISSION

17 CFR Parts 15, 16, 17, 18, 19 and 21

RIN 3038-AC08


Reporting Levels and Recordkeeping

AGENCY: Commodity Futures Trading Commission.

ACTION: Final rules.

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SUMMARY: The Commodity Futures Trading Commission (Commission or CFTC) 
has adopted several amendments to its contract market and large trader 
reporting rules (reporting rules). First, with regard to contract 
reporting levels, the Commission has raised existing levels for certain 
commodities, established a new default contract reporting level for 
broad-based securities indexes, and introduced additional reporting 
levels to address recent market developments. Second, the Commission 
has adopted rules to specify the manner in which a set of new 
transactions, such as exchanges of futures for swaps, are reported to 
the Commission. Third, the Commission has updated its reporting rules 
to acknowledge current data transmission practices, to foster 
innovative means of filing forms identifying the owners of accounts 
with reportable positions, and to eliminate the use of Form 103 for the 
submission of special call data. Finally, the Commission has adopted a 
number of clarifying and technical amendments.

DATES: Effective January 20, 2005.

FOR FURTHER INFORMATION CONTACT: Gary Martinaitis, Associate Deputy 
Director for Market Information, Market Surveillance Section (telephone 
202-418-5209, e-mail <a href="/cdn-cgi/l/email-protection#41262c203335282f202835283201222735226f262e37"><span class="__cf_email__" data-cfemail="e3848e8291978a8d828a978a90a380859780cd848c95">[email protected]</span></a>), or Bruce Fekrat, Attorney, 
Office of the Director (telephone 202-418-5578, e-mail 
<a href="/cdn-cgi/l/email-protection#375551525c455643775451435419505841"><span class="__cf_email__" data-cfemail="345652515f46554074575240571a535b42">[email protected]</span></a>), Division of Market Oversight, Commodity Futures 
Trading Commission, Three Lafayette Centre, 1155 21st Street, NW., 
Washington, DC 20581.

SUPPLEMENTARY INFORMATION:

I. Large Trader Reporting Rules

A. Background

    The Commission's reporting rules provide an important tool for 
market oversight and other surveillance activities. The rules governing 
this system, among other things, require futures commission merchants 
(FCMs), clearing members and foreign brokers (collectively reporting 
firms) to report position and identifying information of the largest 
futures and option traders, and require traders themselves to provide 
certain position and identifying information to the Commission. 
Reporting levels are set for futures and option contracts under the 
authority of sections 4c and 4i of the Commodity Exchange Act (CEA or 
Act) to ensure that the Commission receives adequate information to 
carry out its market surveillance programs.\1\ These market 
surveillance programs are designed to detect and prevent price 
manipulation and market congestion on designated contract markets 
(DCMs), and to enforce speculative position limits pursuant to section 
4a of the Act. The Commission's market surveillance programs also 
provide information on the overall hedging and speculative use of, and 
foreign participation in, the futures and option markets and other 
matters of public interest.\2\ On May 12, 2004, the Commission 
published a notice of rulemaking for public comment proposing to amend 
its reporting rules.\3\ With several minor exceptions, the Commission 
herein is adopting the amendments as proposed.
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    \1\ Section 4i of the Act requires the filing of such reports as 
the Commission may require when transactions or positions made or 
obtained on contract markets or derivatives transaction execution 
facilities equal or exceed Commission set levels. Section 4g of the 
Act requires each registrant, whether an FCM, introducing broker, 
floor broker, or floor trader, to file such reports as the 
Commission may require on proprietary and customer transactions or 
positions executed on any board of trade in the United States or 
elsewhere.
    \2\ Information collected through the large trader reporting 
system is also important to the Commission's financial surveillance 
efforts in furtherance of its responsibility to oversee the 
financial, as well as the economic, integrity of the markets. For 
example, the Division of Clearing and Intermediary Oversight uses 
various automated tools to combine position information with 
financial information routinely collected from FCMs to assess and 
analyze financial risks presented by large customer positions to 
both the firms carrying those positions and the respective clearing 
organizations.
    \3\ 69 FR 26333 (May 12, 2004).
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B. Raising Contract Reporting Levels for Certain Commodities

1. Amended Reporting Levels
    Generally, the firm carrying a trader's reportable position files 
large trader reports.\4\ The Commission has traditionally calibrated 
contract

[[Page 76393]]

reporting levels to ensure that the aggregate of all positions reported 
to the Commission typically represents 70 to 90 percent of the open 
interest in any given contract. The Commission periodically reviews for 
each contract information concerning trading volume, open interest, the 
number and position sizes of individual traders relative to the 
reporting levels, and the Commission's surveillance experience with 
specific contracts, to determine if coverage of open interest is 
adequate for effective market surveillance. In this regard, the 
Commission is mindful of the burden associated with these reporting 
requirements and reviews them with an eye to streamlining that burden 
to the extent compatible with its responsibilities for rigorous 
surveillance of the commodity futures and option markets. The 
Commission's most recent review of reporting levels indicates that the 
relative size of trading volume, open interest, and positions of 
traders enables the Commission to raise reporting levels as follows: 
(1) Milk, Class III from 25 to 50 contracts; (2) Soybeans from 100 to 
150 contracts; (3) Wheat from 100 to 150 contracts; (4) Corn from 150 
to 250 contracts; (5) Sugar No. 11 from 400 to 500 contracts; (6) 
Cotton from 50 to 100 contracts; (7) Natural Gas from 175 to 200 
contracts; (8) Crude Oil, Sweet--No. 2 Heating Oil Crack Spread from 25 
to 250 contracts; (9) Crude Oil, Sweet--Unleaded Gasoline Crack Spread 
from 25 to 150 contracts; (10) Unleaded Gasoline--No. 2 Heating Oil 
Spread Swap from 25 to 150 contracts; (11) 1-Month LIBOR from 300 to 
600 contracts; (12) 30-Day Fed Funds from 300 to 600 contracts; (13) 3-
Month Eurodollar Time Deposit Rates from 1,000 to 3,000 contracts; (14) 
TRAKRS from 25,000 to 50,000 contracts; (15) E-Mini S&P 500 Stock Price 
Index from 300 to 1,000 contracts \5\; (16) 2-Year U.S. Treasury Notes 
from 500 to 1,000 contracts; (17) 5-Year U.S. Treasury Notes from 800 
to 2,000 contracts; (18) 10-Year U.S. Treasury Notes from 1,000 to 
2,000 contracts; and (19) 30-Year U.S. Treasury Bonds from 1,000 to 
1,500 contracts.
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    \4\ Specifically, parts 17 and 18 of the Commission's 
regulations require reports from firms and traders, respectively, 
when a trader holds a ``reportable position.'' See 17 CFR parts 17 
and 18. A reportable position is any open contract position, as 
further defined in the rules, that at the close of the market on any 
business day equals or exceeds the quantity specified in Rule 15.03. 
See 17 CFR 15.00. The firms that carry accounts for traders holding 
reportable positions are required to identify those accounts on Form 
102 and to report positions in the accounts to the Commission. The 
individual trader who holds or controls a reportable position, 
however, is required to report position and identifying information 
to the Commission only in response to a special call.
    \5\ Previously, the reporting levels for the S&P 500 Stock Price 
Index contract and the E-Mini S&P 500 Stock Price Index contract 
were 1,000 and 300 contracts, respectively. As amended, the 
reporting levels for the S&P 500 Stock Price Index contract and the 
E-Mini S&P 500 Stock Price Index contract will be the same. 
Accordingly, the Commission is deleting the separate reference to 
the E-Mini S&P 500 Stock Price Index in Rule 15.03. Subject to this 
single exception for the E-Mini S&P 500 Stock Price Index contract, 
the Commission's practice has been to apply the same reporting level 
to both e-mini and related full-size contracts.
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    In response to the proposed rulemaking's request for public 
comment, U.S. Futures Exchange, L.L.C. (Eurex US), a Commission 
designated board of trade, recommended increasing the contract 
reporting level for all U.S. Treasury Notes and Bonds to the 5,000 
contract range.\6\ As stated in its comment letter, Eurex US based its 
recommendation on the amount of deliverable supply, increases in 
trading volume, and the average size of specific transactions.\7\ The 
Commission carefully considered Eurex US's recommendation, but 
concluded that more modest increases in contract reporting levels 
better facilitate the Commission's obligation to rigorously surveil the 
market for U.S. Treasury Notes and Bonds.
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    \6\ Letter from Satish Nandapurkar, CEO, U.S. Futures Exchange, 
L.L.C. to Jean A. Webb, Secretary of the Commission at 1 (June 10, 
2004) (on file with the Commission).
    \7\ Id.
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2. The Impact of Raising Reporting Levels
    The adjustments to reporting levels will decrease the number of 
daily position and identifying reports, such as Series '01 Reports and 
Forms 102, that reporting firms are currently required to file.\8\ The 
number of Forms 40 filed by large traders will also decrease.\9\ 
However, according to administrative experience and analysis performed 
by the Commission's surveillance staff, the percent of total market 
open interest reported through the large trader reporting system will 
remain at a level deemed sufficient for rigorous market surveillance.
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    \8\ A Series '01 Report itemizes the account number and certain 
positions, deliveries, and exchanges of futures associated with each 
account carrying a reportable position. See 17 CFR 17.00. The name, 
address, and occupation of the person or persons who own such 
accounts are separately identified on Form 102. See 17 CFR 17.01.
    \9\ Form 40 is a statement filed by a reporting trader on 
special call from the Commission. Reporting traders must list their 
name, address, telephone number, and principal occupation. Reporting 
traders are also required to disclose certain information relating 
to their business associations and their financial interest in, and 
control of, accounts that carry reportable positions. See 17 CFR 
part 18.
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    Furthermore, not all reporting firms may elect to report under the 
Commission's higher, and therefore potentially less burdensome, 
reporting levels because exchanges also maintain large trader reporting 
systems that are similar in most respects to the Commission's system. 
The exchanges set their own reporting levels, which for particular 
contracts may vary from Commission set levels. When exchange reporting 
levels are set lower than those set by the Commission, firms may report 
to the Commission at the lower exchange set level, thereby saving any 
cost associated with reprogramming their reporting systems.\10\ The 
Commission, however, only requires the filing of large trader reports 
for positions that equal or exceed its reporting levels.
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    \10\ See 62 FR 24026, 24028 n. 7 (May 2, 1997).
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C. Default Reporting Level for Broad-Based Securities Indexes

    The general default reporting level for all positions, including 
positions in broad-based securities indexes, is currently 25 contracts. 
The Commission is adopting, as proposed, a new default reporting level 
of 200 contracts specifically for broad-based securities indexes. By 
adopting such a default reporting level, the following commodities will 
no longer be enumerated in Rule 15.03, and therefore, will be subject 
to the new default reporting level of 200 contracts: (1) S&P 400 Midcap 
Stock Index--currently 100 contracts; (2) Dow Jones Industrial Average 
Index--currently 100 contracts; (3) New York Stock Exchange Composite 
Index--currently 50 contracts; (4) Amex Major Market Index, Maxi--
currently 100 contracts; (5) NASDAQ 100 Stock Index--currently 100 
contracts; (6) Russell 2000 Stock Index--currently 100 contracts; (7) 
Value Line Average Index--currently 50 contracts; and (8) NIKKEI Stock 
Index--currently 100 contracts. The reporting level for the S&P 500 
Stock Price Index and the Municipal Bond Index, however, will remain at 
1,000 and 300 contracts, respectively.

D. Additional Contract Reporting Levels

    To address recent market developments, the Commission is 
establishing enumerated reporting levels for three German federal 
government debt instruments, as well as a reporting level for products 
that are offered by HedgeStreet, Inc. (HedgeStreet), a new DCM. The 
reporting levels for the German debt instruments and the products 
offered by HedgeStreet are as follows: (1) 10-Year German Federal 
Government Debt--1,000 contracts; (2) 5-Year German Federal Government 
Debt--800 contracts; (3) 2-Year German Federal Government Debt--500 
contracts; and (4) HedgeStreet Products--125,000 contracts.
    The reporting level enumerated for HedgeStreet products is 
applicable to HedgeStreet contracts that pay a maximum of $10.00 if in 
the money upon expiration. In light of the relatively low value of 
these products, the Commission is adopting a reporting level of 125,000 
contracts. Since the value of HedgeStreet products could result in the 
reporting of positions that

[[Page 76394]]

numerically are very large, and due to current limitations in the 
Commission's large trader record format, HedgeStreet positions are to 
be reported under part 17 of the Commission's regulations by rounding 
down to the nearest 1,000 contracts and then dividing by 1,000. For 
example, a position of 177,955 contracts would be rounded down to 
177,000 contracts, divided by 1,000, and then reported as 177.\11\
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    \11\ See 17 CFR 17.00(g)(1).
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    As initially structured by the Commission, the proposed enumerated 
reporting level for HedgeStreet products applied only to European-style 
binary options that were derivatives of economic indexes and paid a 
fixed $10.00 when in the money upon expiration. The terms of the 
proposed reporting level were based upon the Commission's understanding 
that HedgeStreet contracts would initially have economic indexes as 
their underlying. However, in its comment letter on the proposed 
rulemaking, HedgeStreet requested that the Commission apply the 125,000 
contract reporting level to HedgeStreet products that would not have 
economic indexes as their underlying.\12\
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    \12\ Letter from Michael Connor, President, HedgeStreet, Inc. to 
Jean A. Webb, Secretary of the Commission at 1 (June 8, 2004) (on 
file with the Commission).
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    Because of the relatively low notional value of HedgeStreet 
products, the reporting levels otherwise applicable to such contracts, 
including the default reporting level of 25 contracts, may place an 
undue reporting burden on HedgeStreet and its members without 
substantially facilitating the Commission's objective of, and 
responsibility for, conducting meaningful market surveillance. The 
Commission, therefore, believes that a reporting level of 125,000 
contracts for all HedgeStreet commodity futures and option contracts 
with a maximum payout of $10 appropriately apprises the Commission of 
significant positions and relieves unnecessary burdens on HedgeStreet 
and its members.\13\
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    \13\ See Division of Market Oversight No-Action Letter to 
HedgeStreet, Inc. (July 26, 2004) (on file with the Commission).
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II. Trades Involving the Exchange of Commodity Futures Contracts

    On December 21, 2000, the President signed into law the Commodity 
Futures Modernization Act of 2000 (CFMA), extensively revising the 
CEA.\14\ The CFMA facilitated the introduction of certain new 
transactions by the exchanges, including certain off-centralized-market 
trades such as exchanges of futures for swaps (EFS).\15\ Currently, 
several exchanges have rules permitting EFSs and other types of off-
centralized-market trades referred to as exchanges of futures for risk 
(EFR) and exchanges of futures for options (EFO).\16\ However, parts 16 
and 17 of the Commission's regulations previously required contract 
markets and reporting firms to separately account only for volume 
attributable to EFPs.\17\
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    \14\ Appendix E of Pub. L. 106-554, 114 Stat. 2763 (2000).
    \15\ For instance, section 5(b)(3)(B) of the Act provides that 
DCM rules may authorize ``an exchange of--(i) futures in connection 
with a cash commodity transaction; (ii) futures for cash 
commodities; or (iii) futures for swaps * * *.'' 7 U.S.C. 
7(b)(3)(B).
    \16\ An EFS, EFR, and EFO works similarly to a transaction 
involving the exchange of futures for physicals (EFP). EFPs allow 
market participants to exchange a position in a futures contract 
with a similar cash market position. EFSs allow market participants 
to exchange a position in a futures contract for a cash-settled swap 
position. EFRs allow market participants to exchange a position in a 
futures contract for an over-the-counter derivatives position. EFOs 
allow market participants to exchange a position in a futures 
contract for an off-exchange options position.
    \17\ In the notice of proposed rulemaking, the Commission 
referred to transactions involving the exchange of futures as 
``exchanges of futures for a commodity or transaction other than a 
futures product.'' 69 FR 26335. The final rules, however, refer to 
such transactions as ``exchanges of futures for a commodity or for a 
derivatives position'' in order to capture a broader set of 
transactions and remain consistent with terminology used in another 
Commission notice of rulemaking. See 69 FR 39880 (July 1, 2004).
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    In order to recognize the growing use of these off-centralized-
market trades, the final rules require exchanges and reporting firms to 
report all trades involving the exchange of futures for a commodity or 
for a derivatives position in the same manner as they previously 
reported EFP transactions. Therefore, exchanges and reporting firms 
will group together all EFPs, EFSs, EFRs, EFOs or other exchanges of 
futures for a commodity or for a derivatives position permitted by 
exchange rules, and report the sum under the same category. This is an 
appropriate approach because all of these trades are similar in that 
they permit the exchange of a futures position for an off-exchange 
position. Block trades, however, will not be included in this total 
because they do not involve the exchange of a commodity futures 
contract for a commodity or for a derivatives position. Volume 
attributable to block trades shall be reported with other volume.
    With regard to the reporting of exchanges of futures, one 
commenter, Rolfe and Nolan Systems, Inc., a recordkeeping and reporting 
service provider, requested that the Commission allow at least 90 days 
after the finalization of the reporting rules for FCMs to comply with 
the requirement to aggregate exchanges of futures.\18\ The commenter 
indicated that compliance with the new requirement would compel certain 
programming modifications.\19\ In the Commission's view, this request 
is reasonable. In order to permit ample time for persons with reporting 
obligations to implement any necessary programming modifications, the 
Commission will not institute any enforcement proceeding under parts 15 
through 18, and part 21, for non-compliance with the adopted reporting 
requirements applicable to exchanges of futures other than EFPs until 
the expiration of 90 days from the date of publication of these rules 
in the Federal Register. During this interval, compliance with the 
rules applicable to exchanges of futures is voluntary, however, persons 
with reporting obligations must continue to comply with all reporting 
requirements that are applicable to EFPs.
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    \18\ Letter from John Munro, Senior Vice President of Product 
Design, Rolfe and Nolan Systems, Inc. to Jean A. Webb, Secretary of 
the Commission at 1 (June 1, 2004) (on file with the Commission).
    \19\ Id.
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III. Modernization of Rules Covering Data and Hard Copy Submissions

    The Commission is adopting a series of rule amendments that are 
designed to update the reporting process in recognition of 
technological advancements. Parts 16 through 18, and part 21, 
previously required the submission of reports in hard copy form or 
through the dial-up transmission of data. The final rules amend these 
requirements to reflect the existing industry practice of using 
Internet data transmissions in place of dial-up transmissions and the 
use of exchange websites as a store of daily data in place of compiling 
information in hard copy form. The Commission, in addition to making 
certain other minor amendments that affect the reporting process, is 
also eliminating the use of Form 103 for the submission of special call 
data under part 18, and adopting final rules designed to foster 
innovation in the means reporting firms use to file Forms 102 as 
required by part 17.\20\
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    \20\ Although generally supportive of the Commission's efforts 
to encourage electronic methods for publishing information and 
making regulatory filings, Eurex US commented that the Commission 
should adopt a consistent electronic protocol for the submission of 
data. Letter from Satish Nandapurkar, CEO, U.S. Futures Exchange, 
L.L.C. to Jean A. Webb, Secretary of the Commission at 2 (June 10, 
2004) (on file with the Commission). As requested, the Commission 
will endeavor to adopt consistent and uniform electronic data 
submission procedures where appropriate. Nevertheless, the 
Commission believes that in order to lessen reporting and filing 
burdens on all exchanges and market participants, electronic data 
submission protocols must inherently incorporate a reasonable 
measure of procedural flexibility.

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[[Page 76395]]

    The rules contained within part 16 of the Commission's regulations 
require reports from contract markets. The final rules eliminate the 
requirement for filing daily hard copy clearing member reports and 
daily hard copy submissions of data on trading volume, exchanges of 
futures, open contracts, delivery notices, option deltas, prices, and 
critical dates. These reports will only be required in hard copy form 
upon the request of the Commission or its staff. Also, the Commission 
is replacing the requirement of providing printed forms of data on 
trading volume, exchanges of futures, open contracts, delivery notices, 
and option deltas to the news media and members of the public with a 
general requirement that such information be made readily available to 
such persons.
    The Commission is also replacing explicit requirements in part 16 
for the dial-up transmission of data with more general data 
transmission requirements. Finally, in light of advances in technology, 
the Commission is requiring the submission of clearing member reports 
and certain data regarding trading volume, open interest, prices and 
critical dates by 12 noon on the business day following the day to 
which the information pertains. Previously, such information was 
required to be submitted by 3 p.m. on the business day following the 
day to which the information pertained. The Commission believes that 
the information is currently being submitted within the adopted noon 
deadline.
    In part 17, which governs reports submitted by reporting firms, the 
Commission is substituting specific requirements pertaining to the use 
of dial-up transmissions, submissions of '01 forms, and computer 
printouts with more general data transmission requirements. 
Furthermore, the Commission will permit reporting firms to authenticate 
Forms 102 by a means other than manually signing the form. The 
signature requirement necessitates the physical filing of Forms 102. 
Physically filing these forms remains one of the more costly aspects of 
large trader reporting for the industry. In order to foster innovative 
and cost effective means of fulfilling this reporting requirement, 
including the possibility of electronic filing, the Commission will 
accept alternative means of authentication. While a manual signature 
will remain the default method of authentication, the Commission will 
retain the authority to approve other means of authentication as new 
filing solutions become available and accepted by market participants.
    In part 18, which governs reports filed by traders, the Commission 
is eliminating the use of Form 103 for data requested by the Commission 
on special call. The format of the submitted data will be per 
instruction contained in the call.\21\ In addition, consistent with the 
newly adopted requirements for the daily submission of large trader 
data, the Commission will also require traders to identify exchanges of 
futures for commodities or for derivatives positions in response to 
such a call.
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    \21\ This matches current industry and Commission practice. The 
Commission is also amending Rule 15.02 to remove Form 103 from the 
list of forms to be used in filing reports.
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    The Commission is also deleting Rule 18.02 which provides for the 
use of code numbers for the designation and identification of accounts. 
Rule 18.02 was relevant to a reporting structure that relied on the 
routine receipt of large trader reports directly from traders. The 
Commission has not assigned a code number under Rule 18.02 in many 
years and, if a request for such assignment is made in the future, the 
Commission can accommodate the request informally. Finally, the 
Commission is amending part 18 by deleting Rule 18.06 as the referenced 
technology is no longer is use.
    In part 21, which governs special calls, the requirement for 
machine-readable information adhering to a specific record layout is 
deleted. The requirement for the information to be prepared in 
accordance with instructions in the call will remain. This matches 
current industry and Commission practice.

IV. Clarifying and Technical Amendments

    The Commission has identified a number of other provisions of the 
reporting rules that either do not reflect current industry or 
Commission practice or otherwise should be corrected or updated. First, 
the Commission is amending Rule 15.00(b)(1)(ii) to clarify that options 
on physicals are included in the definition of reportable position.\22\ 
Second, the Commission is amending Rule 17.00(a) to clarify that a 
reportable position in a commodity in a special account requires that 
all positions in that same commodity on the same exchange in the 
special account be reported.\23\ Third, the Commission is amending Rule 
17.04 to clarify that option positions are to be included in reports of 
omnibus accounts. Each of these clarifications is reflective of current 
industry and Commission practice.
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    \22\ Prior to 1997, the definition of a reportable position 
explicitly referenced options on physicals. 17 CFR 15.00(b)(2) 
(1996). When the Commission amended that definition in 1997, that 
reference was deleted. 62 FR 24026 (May 2, 1997). The Commission 
believes that this deletion was unintentional as no explanation was 
provided at the time. Id.; see also 61 FR 37409 (July 18, 1996). 
Furthermore, both the Commission and the industry have continued to 
include options on physicals in reports filed under parts 15 through 
21. See 17 CFR 16.00(a), 16.01(a), 21.02a(b)(4)(vii). Accordingly, 
the Commission believes that it is appropriate at this time to amend 
the definition of reportable position to clarify that it includes 
options on physicals, both to correct what appears to have been an 
unintentional limitation of the definition in 1997 and to align the 
definition with current industry and Commission reporting practices.
    \23\ Part 17 was amended in 1997 to reflect this requirement. 
See 62 FR 24026, 24028 n. 7 (May 2, 1997). In practice, however, it 
appears that further clarification would be helpful.
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    The Commission is also amending Rules 16.00(b)(2) and 16.01(d)(2) 
to provide that the time by which the market reports required by those 
rules must be filed is governed by a particular time zone, unless 
otherwise specified by the Commission or its designee. The Commission 
specified eastern time for markets located in that time zone and 
central time for markets located elsewhere because Commission staff in 
Chicago and Kansas City assume surveillance duties for markets located 
outside of New York. The Commission is also adopting certain technical 
amendments to Rule 17.00(g). Specifically, it is removing the 
references to particular exchanges in subsection (2)(v) and making 
certain editorial changes in subsections (2)(vi) and (2)(xi). The 
Commission is also altering the requirement in Rule 17.01 regarding 
identification of special accounts to exchanges on Form 102.\24\ 
Finally, the Commission is updating and correcting certain outdated 
references to the provisions of part 15 that appear in part 19.
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    \24\ This change is consistent with earlier changes made to the 
Commission's rules and does not relieve reporting firms from their 
obligation to comply with any applicable exchange requirements 
regarding the submission of Forms 102 to the exchanges. See 62 FR 
24026 (May 2, 1997).
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V. Related Matters

A. Cost Benefit Analysis

    Section 15(a) of the Act requires the Commission to consider the 
costs and benefits of its action before issuing a new regulation under 
the Act. By its terms, section 15(a) does not require the Commission to 
quantify the costs and benefits of a new regulation or to determine 
whether the benefits of the proposed regulation outweigh its costs. 
Rather, section 15(a) requires the

[[Page 76396]]

Commission to ``consider the costs and benefits'' of the subject rule.
    Section 15(a) further specifies that the costs and benefits of the 
proposed rule shall be evaluated in light of five broad areas of market 
and public concern: (1) Protection of market participants and the 
public; (2) efficiency, competitiveness, and financial integrity of 
futures markets; (3) price discovery; (4) sound risk management 
practices; and (5) other public interest considerations. The Commission 
may, in its discretion, give greater weight to any one of the five 
enumerated areas of concern and may, in its discretion, determine that, 
notwithstanding its costs, a particular rule is necessary or 
appropriate to protect the public interest or to effectuate any of the 
provisions or to accomplish any of the purposes of the Act.
    The Commission's notice of proposed rulemaking contained an 
analysis of its consideration of these costs and benefits and solicited 
public comment thereon.\25\ The Commission specifically invited 
commenters to submit any data that they had quantifying the costs and 
benefits of the proposed rules. The Commission, however, received no 
comment letter that considered the costs and benefits of the proposed 
rules. The Commission has considered the costs and benefits of these 
rules in light of the specific areas of concern identified in section 
15. The Commission has endeavored in these rules to impose the minimum 
requirements necessary to enable the Commission to perform its 
oversight functions, to carry out its mandate of assuring the continued 
existence of competitive and efficient markets and to protect the 
public interest in markets free of fraud and abuse. After considering 
these factors, the Commission has determined to adopt the revisions to 
parts 15 through 19, and part 21, as set forth below.
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    \25\ 69 FR at 26336.
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B. The Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA), 5 U.S.C. 601 et seq., 
requires that agencies consider the impact of their rules on small 
businesses. The Commission has previously determined that contract 
markets, futures commission merchants and large traders are not ``small 
entities'' for purposes of the RFA.\26\ The requirements of the 
proposed amendments fall mainly on contract markets and FCMs. 
Similarly, foreign brokers and foreign traders report only if carrying 
or holding reportable large positions. In addition, these amendments 
relieve regulatory burdens. Accordingly, the Acting Chairman, on behalf 
of the Commission, hereby certifies, pursuant to 5 U.S.C. 605(b), that 
the actions taken herein will not have a significant economic impact on 
a substantial number of small entities.
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    \26\ 47 FR 18618-21 (April 30, 1982).
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C. The Paperwork Reduction Act

    The revision of collections of information in these final rules 
have been reviewed and approved by the Office of Management and Budget 
pursuant to the Paperwork Reduction Act of 1995, 44 U.S.C. 3507(d), 
under control numbers 3038-0009 and 3038-0012. An agency may not 
conduct or sponsor, and a person is not required to respond to, a 
collection of information unless it displays a currently valid control 
number. In the notice of proposed rulemaking, the Commission estimated 
the paperwork burden that would be imposed by the rules and sought 
comments on the estimates.\27\ Only a single comment pertained 
tangentially to the collections of information requirements. Rolfe and 
Nolan Systems, Inc., a recordkeeping and reporting service provider, 
requested that the Commission allow at least 90 days for FCMs to comply 
with the requirement to aggregate exchanges of futures for reporting 
purposes.\28\ The Commission has determined to grant that request.
---------------------------------------------------------------------------

    \27\ 69 FR 26333, 26337.
    \28\ Letter from John Munro, Senior Vice President of Product 
Design, Rolfe and Nolan Systems, Inc. to Jean A. Webb, Secretary of 
the Commission at 1 (June 1, 2004) (on file with the Commission).
---------------------------------------------------------------------------

1. Scope of the Collections of Information
    Parts 15 through 21 of the Commission's regulations require reports 
from exchanges and large trader reports from clearing members, FCMs, 
foreign brokers, and traders. These rules are designed to provide the 
Commission with information to effectively conduct its market 
surveillance program, which includes the detection and prevention of 
price manipulation and enforcement of speculative position limits. The 
final rules give exchanges, reporting firms, and traders substantial 
flexibility in adopting technologically advanced techniques for data 
collection, retention, and submission.
    Part 16 of the Commission's regulations requires reports from 
exchanges. The final rules eliminate the requirements for daily hard 
copy clearing member and market data reports to the Commission. 
Furthermore, the Commission has replaced explicit requirements for a 
dial-up form of data transmission with more general requirements for 
data transmission.
    In part 17, which governs reports by reporting firms, the 
Commission has replaced specific requirements pertaining to the use of 
dial-up transmissions with more general data transmission requirements. 
In order to foster more innovative and cost efficient means for filing 
Forms 102, including the possibility of electronic filing, the 
Commission has adopted a final rule that facilitates the adoption of 
alternative means for authenticating Forms 102.
    In part 18, which governs reports by traders, the Commission will 
no longer use Form 103 when seeking data via special call. The form of 
the data will now be per instruction contained in the call. In part 21, 
which governs special calls, the requirement for machine-readable 
information adhering to a specific record layout as contained in the 
rules has been eliminated. The requirement for the information to be 
prepared in accordance with instructions in the call remains.
2. Respondents and Estimated Reporting Burden
    Twelve exchanges provide the data required under Rule 16.00 once on 
each of an estimated 220 business days per year. All twelve exchanges 
provide a set of information which includes daily options and futures 
market data showing open contracts, volume of trading, deliveries and 
exchanges of futures for physicals (EFPs) by clearing member firms 
associated with the exchange's derivatives clearing organization. The 
final rules require the reporting of all exchanges of futures. The 
burden associated with this reporting obligation is minimal. The final 
rules only require that exchanges aggregate all exchanges of futures 
and report them as a single sum without further itemization. The total 
burden in hours for the reporting of trading data by the exchanges is 
estimated at 879 hours.
    The twelve exchanges also provide the market information required 
by Rule 16.01 for each of approximately 220 trading days per year. We 
have estimated that it takes the exchanges about 30 minutes per day to 
generate and transmit each data file. This results in an annual burden 
of approximately 1,760 hours. The total estimated annual burden for 
this collection of information has increased by 440 hours. The 
increase, however, is mainly attributable to an increase in the number 
of exchanges with market data reporting obligations.

[[Page 76397]]

    Approximately 750 clearing members, FCMs, and foreign brokers are 
subject to routine reporting requirements. The final rules do not 
increase the aggregate burden hours required for such persons to comply 
with the routine reporting requirements. Under Rule 17.00, routine 
reports are filed only for accounts with futures and option positions 
that meet or exceed levels set by the Commission in Rule 15.03(b). It 
is estimated that this represents about 10 percent of all accounts 
carried by potential respondents and that less than one-half 
(approximately 264) of all respondents may be required to file reports 
at any one time. Of the 264 firms, two service bureaus file reports for 
approximately 40 firms. Therefore, the Commission receives reports 
electronically from 226 sources. Less than 15 minutes per day are 
expended by each source in generating files and transmitting them to 
the Commission. Over a 220-day period, the routine reporting burden on 
these firms is 12,430 hours.
    Each account reported to the Commission must also be identified on 
Form 102. Form 102 provides information that allows the Commission to 
combine different accounts held or controlled by the same trader and to 
identify commercial firms using the markets for hedging. The total 
number of Forms 102 filed with the Commission is estimated at 4,000 per 
year for a burden of 800 hours. The final rules require the reporting 
of all exchanges of futures. The burden associated with this reporting 
obligation is minimal. The final rules only require that reporting 
firms aggregate all exchanges of futures and report them as a single 
sum without further itemization.
    Traders file Forms 40 under Rule 18.04, and Forms 103 on call by 
the Commission under Rule 18.00. The number of traders filing Forms 40 
is estimated at 2,400 per year, and the total annual burden for filing 
such information is estimated to be 800 hours. The Commission has 
maintained the authority to make special calls on traders under part 18 
of the regulations when the information obtained routinely under part 
17 of the regulations is incomplete for its purposes. In order to 
streamline this collection of information, the final rules eliminate 
Forms 103 altogether for the submission of special call data by large 
traders. The form of the data collected will be per instruction 
contained in the special call. The final rules also require the 
reporting of all exchanges of futures. The burden associated with this 
reporting obligation for traders is minimal. The final rules only 
require that traders aggregate all exchanges of futures and report them 
as a single sum without further itemization.
3. Request for Comment
    The Commission invites comment on the accuracy of the burden 
estimates and suggestions on how to further reduce these burdens. 
Comments should be directed to Gary Martinaitis, Associate Deputy 
Director for Market Information, Market Surveillance Section, Division 
of Market Oversight, Commodity Futures Trading Commission, Three 
Lafayette Centre, 1155 21st Street, NW., Washington, DC 20581 
(telephone 202-418-5209, e-mail <a href="/cdn-cgi/l/email-protection#43242e2231372a2d222a372a3003202537206d242c35"><span class="__cf_email__" data-cfemail="01666c607375686f606875687241626775622f666e77">[email protected]</span></a>).

List of Subjects

17 CFR Part 15

    Brokers, Commodity futures, Reporting and recordkeeping 
requirements.

17 CFR Part 16

    Commodity futures, Reporting and recordkeeping requirements.

17 CFR Part 17

    Brokers, Commodity futures, Reporting and recordkeeping 
requirements.

17 CFR Part 18

    Commodity futures, Reporting and recordkeeping requirements.

17 CFR Part 19

    Commodity futures, Cotton, Grains, Reporting and recordkeeping 
requirements.

17 CFR Part 21

    Brokers, Commodity futures, Reporting and recordkeeping 
requirements.

0
In consideration of the foregoing, and pursuant to the authority 
contained in the Act, and, in particular, sections 4g, 4i, 5 and 8a of 
the Act, the Commission hereby amends chapter I of title 17 of the Code 
of Federal Regulations as follows:

PART 15--REPORTS--GENERAL PROVISIONS

0
1. The authority citation for part 15 continues to read as follows:

    Authority: 7 U.S.C. 2, 5, 6, 6a, 6c, 6f, 6g, 6i, 6k, 6m, 6n, 7, 
7a, 9, 12a, 19 and 21, as amended by the Commodity Futures 
Modernization Act of 2000, Appendix E of Pub. L. 106-554, 114 Stat. 
2763 (2000); 5 U.S.C. 552 and 552(b).


0
2. In Sec.  15.00, revise paragraph (b)(1)(ii) to read as follows:


Sec.  15.00  Definitions of terms used in parts 15 to 21 of this 
chapter.

* * * * *
    (b) * * *
    (1) * * *
    (i) * * *
    (ii) Long or short put or call options that exercise into the same 
future of any commodity, or long or short put or call options for 
options on physicals that have identical expirations and exercise into 
the same physical, on any one contract market.
* * * * *

0
3. Revise Sec.  15.02 to read as follows:


Sec.  15.02  Reporting forms.

    Forms on which to report may be obtained from any office of the 
Commission or via the Internet (http://www.cftc.gov). Forms to be used 
for the filing of reports follow, and persons required to file these 
forms may be determined by referring to the rule listed in the column 
opposite the form number.

------------------------------------------------------------------------
          Form  No.                          Title                 Rule
------------------------------------------------------------------------
40...........................  Statement of Reporting Trader....   18.04
'01..........................  Positions of Special Accounts....   17.00
102..........................  Identification of Special           17.01
                                Accounts.
204..........................  Cash Positions of Grain Traders     19.00
                                (including Oilseeds and
                                Products).
304..........................  Cash Positions of Cotton Traders.   19.00
------------------------------------------------------------------------


(Approved by the Office of Management and Budget under control 
numbers 3038-0007 and 3038-0009)

0
4. Revise Sec.  15.03 to read as follows:


Sec.  15.03  Reporting levels.

    (a) Definitions. For purposes of this section:
    Broad-based security index is a group or index of securities that 
does not constitute a narrow-based security index.
    HedgeStreet products are contracts offered by HedgeStreet, Inc., a 
designated contract market, that pay up to $10.00 if in the money upon 
expiration.
    Major foreign currency is the currency, and the cross-rates between 
the currencies, of Japan, the United Kingdom, Canada, Australia, 
Switzerland, Sweden and the European Monetary Union.
    Narrow-based security index has the same meaning as in section 
1a(25) of the Commodity Exchange Act.
    Security futures product has the same meaning as in section 1a(32) 
of the Commodity Exchange Act.
    (b) The quantities for the purpose of reports filed under parts 17 
and 18 of this chapter are as follows:

[[Page 76398]]



------------------------------------------------------------------------
                                                             Number of
                        Commodity                            contracts
------------------------------------------------------------------------
Agricultural:
    Wheat...............................................             150
    Corn................................................             250
    Oats................................................              60
    Soybeans............................................             150
    Soybean Oil.........................................             200
    Soybean Meal........................................             200
    Cotton..............................................             100
    Frozen Concentrated Orange Juice....................              50
    Milk, Class III.....................................              50
    Rough Rice..........................................              50
    Live Cattle.........................................             100
    Feeder Cattle.......................................              50
    Lean Hogs...........................................             100
    Sugar No. 11........................................             500
    Sugar No. 14........................................             100
    Cocoa...............................................             100
    Coffee..............................................              50
Natural Resources:
    Copper..............................................             100
    Gold................................................             200
    Silver Bullion......................................             150
    Platinum............................................              50
    No. 2 Heating Oil...................................             250
    Crude Oil, Sweet....................................             350
    Unleaded Gasoline...................................             150
    Natural Gas.........................................             200
    Crude Oil, Sweet--No. 2 Heating Oil Crack Spread....             250
    Crude Oil, Sweet--Unleaded Gasoline Crack Spread....             150
    Unleaded Gasoline--No. 2 Heating Oil Spread Swap....             150
Financial:
    3-month (13-Week) U.S. Treasury Bills...............             150
    30-Year U.S. Treasury Bonds.........................           1,500
    10-Year U.S. Treasury Notes.........................           2,000
    5-Year U.S. Treasury Notes..........................           2,000
    2-Year U.S. Treasury Notes..........................           1,000
    10-Year German Federal Government Debt..............           1,000
    5-Year German Federal Government Debt...............             800
    2-Year German Federal Government Debt...............             500
    3-Month Eurodollar Time Deposit Rates...............           3,000
    30-Day Fed Funds....................................             600
    1-month LIBOR Rates.................................             600
    3-month Euroyen.....................................             100
    Major-Foreign Currencies............................             400
    Other Foreign Currencies............................             100
    U.S. Dollar Index...................................              50
    Goldman Sachs Commodity Index.......................             100
Broad-Based Security Indexes:
    S&P 500 Stock Price Index...........................           1,000
    Municipal Bond Index................................             300
    Other Broad-Based Securities Indexes................             200
Security Futures Products:
    Individual Equity Security..........................           1,000
    Narrow-Based Security Index.........................             200
TRAKRS..................................................      \1\ 50,000
HedgeStreet Products....................................     \1\ 125,000
All Other Commodities...................................              25
------------------------------------------------------------------------
\1\ For purposes of part 17, positions in TRAKRS and HedgeStreet
  products should both be reported by rounding down to the nearest 1,000
  contracts and dividing by 1,000.

PART 16--REPORTS BY CONTRACT MARKETS

0
5. The authority citation for part 16 continues to read as follows:

    Authority: 7 U.S.C. 6a, 6c, 6g, 6i, 7 and 12a, unless otherwise 
noted.


0
6. In Sec.  16.00, revise paragraphs (a)(4) and (b) to read as follows:


Sec.  16.00  Clearing member reports.

    (a) * * *
    (4) The quantity of purchases of futures for commodities or for 
derivatives positions and the quantity of sales of futures for 
commodities or for derivatives positions which are included in the 
total quantity of contracts bought and sold during the day covered by 
the report, and the names of the clearing members who made the 
purchases or sales;
* * * * *
    (b) Form, manner and time of filing reports. Unless otherwise 
approved by the Commission or its designee, contract markets shall 
submit the information required by paragraph (a) of this section as 
follows:

[[Page 76399]]

    (1) Using the format, coding structure, and electronic data 
transmission procedures approved in writing by the Commission or its 
designee; provided however, the information shall be made available to 
the Commission or its designee in hard copy upon request; and
    (2) When such data is first available but not later than 12:00 p.m. 
on the business day following the day to which the information 
pertains. Unless otherwise specified by the Commission or its designee, 
the stated time is eastern time for information concerning markets 
located in that time zone, and central time for information concerning 
all other markets.
* * * * *

0
7. In Sec.  16.01:
0
a. Revise paragraph (a)(2) and the concluding text of paragraph (a), 
which follows paragraph (a)(5);
0
b. Remove the phrase ``, in printed form at the office of the contract 
market,'' from paragraph (b)(3); and
0
c. Revise paragraph (d).
    The revisions read as follows:


Sec.  16.01  Trading volume, open contracts, prices, and critical 
dates.

    (a) * * *
    (2) The total quantity of futures exchanged for commodities or for 
derivatives positions which are included in the total volume of 
trading;
    (5) * * *

    Note to paragraph (a): This information shall be made readily 
available to the news media and the general public without charge no 
later than the business day following the day for which publication 
is made.

* * * * *
    (d) Form, manner and time of filing reports. Unless otherwise 
approved by the Commission or its designee, contract markets shall 
submit to the Commission the information specified in paragraphs (a), 
(b) and (c) of this section as follows:
    (1) Using the format, coding structure and electronic data 
transmission procedures approved in writing by the Commission or its 
designee; provided however, the information shall be made available to 
the Commission or its designee in hard copy upon request; and
    (2) When each such form of the data is first available but not 
later than 7:00 a.m. on the business day following the day to which the 
information pertains for the delta factor and settlement price and not 
later than 12:00 p.m. for the remainder of the information. Unless 
otherwise specified by the Commission or its designee, the stated time 
is eastern time for information concerning markets located in that time 
zone, and central time for information concerning all other markets.
* * * * *
0
8. Revise Sec.  16.06 to read as follows:


Sec.  16.06  Errors or omissions.

    Unless otherwise approved by the Commission or its designee, 
contract markets shall file corrections to errors or omissions in data 
previously filed with the Commission pursuant to Sec. Sec.  16.00 and 
16.01 in the format and using the coding structure and electronic data 
submission procedures approved in writing by the Commission or its 
designee.

0
9. In Sec.  16.07, revise paragraphs (a) and (b) to read as follows:


Sec.  16.07  Delegation of authority to the Director of the Division of 
Market Oversight and the Executive Director.

* * * * *
    (a) Pursuant to Sec. Sec.  16.00(b) and 16.01(d), the authority to 
determine whether contract markets must submit data in hard copy, and 
the time that such data may be submitted where the Director determines 
that a contract market is unable to meet the requirements set forth in 
the regulations;
    (b) Pursuant to Sec. Sec.  16.00(b)(1), 16.00(d)(1), and 16.06, the 
authority to approve the format, coding structure and electronic data 
transmission procedures used by contract markets.

PART 17--REPORTS BY FUTURES COMMISSION MERCHANTS, MEMBERS OF 
CONTRACT MARKETS AND FOREIGN BROKERS

0
10. The authority citation for part 17 continues to read as follows:

    Authority: 7 U.S.C. 6a, 6c, 6d, 6f, 6g, 6i, 7 and 12a, unless 
otherwise noted.


0
11. In Sec.  17.00, revise paragraph (a) heading, add paragraph (a)(1), 
and revise paragraphs (g)(2)(i), (g)(2)(v), (g)(2)(vi), (g)(2)(xi), and 
(h) to read as follows:


Sec.  17.00  Information to be furnished by futures commission 
merchants, clearing members and foreign brokers.

    (a) Special Accounts--Reportable futures and options positions, 
delivery notices, and exchanges of futures. (1) Each futures commission 
merchant, clearing member and foreign broker shall submit a report to 
the Commission for each business day with respect to all special 
accounts carried by the futures commission merchant, clearing member or 
foreign broker, except for accounts carried on the books of another 
futures commission merchant on a fully-disclosed basis. Except as 
otherwise authorized by the Commission or its designee, such report 
shall be made in accordance with the format, coding and data 
transmission procedures set forth in paragraph (g) of this section. The 
report shall show each futures position, separately for each contract 
market and for each future, and each put and call options position 
separately for each contract market, expiration and strike price in 
each special account as of the close of market on the day covered by 
the report and, in addition, the quantity of exchanges of futures for 
commodities or for derivatives positions and the number of delivery 
notices issued for each such account by the clearing organization of a 
contract market and the number stopped by the account. The report shall 
also show all positions in all futures months and option expirations of 
that same commodity on the same contract market for which the special 
account is reportable.
* * * * *
    (a) * * *
    (2) * * *
    (i) Report type. This report format will be used to report three 
types of data: long and short futures and options positions, futures 
delivery notices issued and stopped, and exchanges of futures for a 
commodity or for a derivatives position bought and sold. Valid values 
for the report type are ``RP'' for reporting positions, ``DN'' for 
reporting notices, and ``EP'' for reporting exchanges of futures for a 
commodity or for a derivatives position.
* * * * *
    (v) Exchange. This is a two-character field approved by the 
Commission to identify the exchange on which a position is held.
    (vi) Put or Call. Valid values for this field are ``C'' for a call 
option and ``P'' for a put option. For futures, the field is blank.
* * * * *
    (xi) Long-Buy-Stopped (Short-Sell-Issued). When report type is 
``RP'', report long (short) positions open at the end of a trading day. 
When report is ``DN'', report delivery notices stopped (issued) on 
behalf of the account. When report type is ``EP'', report purchases 
(sales) of futures for a commodity or for a derivatives position for 
the account. Report all information in contracts. Position data are 
reported on a net or gross basis in accordance with paragraphs (d) and 
(e) of this section.
* * * * *
    (h) Correction of errors and omissions. Unless otherwise approved 
by the Commission or its designee, corrections to errors and omissions 
in data provided pursuant to Sec.  17.00(a) shall be filed on series 
`01 forms or in the format, coding structure and data transmission

[[Page 76400]]

procedures approved in writing by the Commission or its designee.
* * * * *

0
12. In Sec.  17.01, revise the introductory text and paragraphs (e), 
(f) and (g) to read as follows:


Sec.  17.01  Special account designation and identification.

    When a special account is reported for the first time, the futures 
commission merchant, clearing member, or foreign broker shall identify 
the account to the Commission on form 102, in the form and manner 
specified in Sec.  17.02, showing the information in paragraphs (a) 
through (f) of this section.
* * * * *
    (e) Account executive. The name and business telephone number of 
the associated person of the futures commission merchant who has 
solicited and is responsible for the account or, in the case of an 
introduced account, the name and business telephone number of the 
introducing broker who introduced the account.
    (f) Reporting firms. The name and address of the futures commission 
merchant, clearing member, or foreign broker carrying the account, the 
name, title and business phone of the authorized representative of the 
firm filing the form 102 and the date of the form 102. The authorized 
representative shall sign the report or satisfy such other requirements 
for authenticating the report as instructed in writing by the 
Commission or its designee.
    (g) Form 102 updates. If, at the time an account is in special 
account status and a form 102 filed by a futures commission merchant, 
clearing member, or foreign broker is then no longer accurate because 
there has been a change in the information required under paragraph (b) 
of this section since the previous filing, the futures commission 
merchant, clearing member, or foreign broker shall file an updated form 
102 with the Commission within three business days after such change 
occurs.

0
13. Revise Sec.  17.02 to read as follows:


Sec.  17.02  Form, manner and time of filing reports.

    Unless otherwise instructed by the Commission or its designee, the 
reports required to be filed by futures commission merchants, clearing 
members and foreign brokers under Sec. Sec.  17.00 and 17.01 shall be 
filed as specified in paragraphs (a) and (b) of this section.
    (a) Section 17.00(a) reports. Reports filed under Sec.  17.00(a) 
shall be submitted through electronic data transmission procedures 
approved in writing by the Commission or its designee not later than 9 
a.m. on the business day following that to which the information 
pertains. Unless otherwise specified by the Commission or its designee, 
the stated time is eastern time for information concerning markets 
located in that time zone, and central time for information concerning 
all other markets.
    (b) Section 17.01 reports. For data submitted pursuant to Sec.  
17.01 on form 102:
    (1) On call by the Commission or its designee, identify the type of 
special account specified by items 1(a), 1(b), or 1(c) of form 102, and 
the name and location of the person to be identified in item 1(d) on 
the form 102, and submit such information by facsimile or telephone, in 
accordance with instructions by the Commission or its designee, on the 
same day that the special account in question is first reported to the 
Commission; and
    (2) Submit a completed form 102 within three business days of the 
first day that the special account in question is reported to the 
Commission in accordance with instructions by the Commission or its 
designee.

0
14. In Sec.  17.03, revise paragraphs (a) and (b), redesignate 
paragraph (c) as paragraph (d) and add a new paragraph (c) to read as 
follows:


Sec.  17.03  Delegation of authority to the Director of the Division of 
Market Oversight and to the Executive Director.

* * * * *
    (a) Pursuant to Sec.  17.00(a) and (h), the authority to determine 
whether futures commission merchants, clearing members and foreign 
brokers can report the information required under Rule 17.00(a) and 
Rule 17.00(h) on series `01 forms or using some other format upon a 
determination that such person is unable to report the information 
using the format, coding structure or electronic data transmission 
procedures otherwise required.
    (b) Pursuant to Sec.  17.02, the authority to instruct and/or 
approve the time at which the information required under Rules 17.00 
and 17.01 must be submitted by futures commission merchants, clearing 
members and foreign brokers provided that such persons are unable to 
meet the requirements set forth in Sec. Sec.  17.01(g) and 17.02.
    (c) Pursuant to Sec.  17.01(f), the authority to determine whether 
to permit an authorized representative of a firm filing the form 102 to 
use a means of authenticating the report other than by signing the form 
102 and, if so, to determine the alternative means of authentication 
that shall be used.
* * * * *

0
15. In Sec.  17.04, revise the second sentence of paragraph (b) and 
paragraphs (b)(1)(i) and (b)(2) to read as follows:


Sec.  17.04  Reporting omnibus accounts to the carrying futures 
commission merchant or foreign broker.

* * * * *
    (b) * * * The futures commission merchant, clearing member or 
foreign broker shall, if both open long and short positions in the same 
future or option are carried for the same trader, compute open long or 
open short positions as instructed in this paragraph.
    (1) * * *
    (i) The positions represent transactions on a contract market which 
requires long and short positions in the same future or option held in 
accounts for the same trader to be recorded and reported on a gross 
basis; or
* * * * *
    (2) Include only the net long or net short positions of the trader 
if the positions represent transactions on a contract market which does 
not require long and short positions in the same future or option held 
in accounts for the same trader to be recorded and reported on a gross 
basis.
* * * * *

PART 18--REPORTS BY TRADERS

0
16. The authority citation for part 18 continues to read as follows:

    Authority: 7 U.S.C. 2, 4, 6a, 6c, 6f, 6g, 6i, 6k, 6m, 6n, 12a 
and 19; 5 U.S.C. 552 and 552(b), unless otherwise noted.


0
17. Revise Sec.  18.00 to read as follows:


Sec.  18.00  Information to be furnished by traders.

    Every trader who owns, holds or controls, or has held, owned or 
controlled, a reportable futures or options position in a commodity 
shall within one business day after a special call upon such trader by 
the Commission or its designee file reports to the Commission 
concerning transactions and positions in such futures or options. 
Reports shall be filed for the period of time that the trader held or 
controlled a reportable position and shall be prepared and submitted as 
instructed in the call. The report shall show for each day covered by 
the report the following information, as specified in the call, 
separately for each future or option and for each contract market:
    (a) Open contracts;
    (b) Purchases and sales;
    (c) Delivery notices issued and stopped;

[[Page 76401]]

    (d) Purchases and sales of futures for commodities or for 
derivatives positions; and
    (e) Options exercised.


(Approved by the Office of Management and Budget under control 
number 3038-0009)


Sec.  18.02  [Removed and Reserved.]

0
18. Remove and reserve Sec.  18.02.


Sec.  18.06  [Removed and Reserved.]

0
19. Remove and reserve Sec.  18.06.

PART 19--REPORTS BY PERSONS HOLDING BONA FIDE HEDGE POSITIONS 
PURSUANT TO Sec.  1.3(Z) OF THIS CHAPTER AND BY MERCHANTS AND 
DEALERS IN COTTON

0
20. The authority citation for part 19 continues to read as follows:

    Authority: 7 U.S.C. 6g(a), 6i and 12a(5), unless otherwise 
noted.


0
21. In Sec.  19.00, revise paragraph (a)(1) and the first sentence of 
(a)(3) to read as follows:


Sec.  19.00  General provisions.

    (a) * * *
    (1) All persons holding or controlling futures and option positions 
that are reportable pursuant to Sec.  15.00(b)(2) of this chapter and 
any part of which constitute bona fide hedging positions as defined in 
Sec.  1.3(z) of this chapter;
* * * * *
    (3) All persons holding or controlling positions for future 
delivery that are reportable pursuant to Sec.  15.00(b)(1) of this 
chapter who have received a special call for series '04 reports from 
the Commission or its designee. * * *
* * * * *

PART 21--SPECIAL CALLS

0
22. The authority citation for part 21 continues to read as follows:

    Authority: 7 U.S.C. 1a, 2, 2a, 4, 6a, 6c, 6f, 6g, 6i, 6k, 6m, 
6n, 7, 7a, 12a, 19 and 21; 5 U.S.C. 552 and 552(b), unless otherwise 
noted.


Sec.  21.02a  [Removed]

0
23. Remove Sec.  21.02a.

    Issued in Washington, DC on December 14, 2004 by the Commission.
Jean A. Webb,
Secretary of the Commission.
[FR Doc. 04-27750 Filed 12-20-04; 8:45 am]
BILLING CODE 6351-01-P


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