[Federal Register Volume 86, Number 12 (Thursday, January 21, 2021)]
[Notices]
[Pages 6304-6306]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-01145]


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COMMODITY FUTURES TRADING COMMISSION


Fees for Reviews of the Rule Enforcement Programs of Designated 
Contract Markets and Registered Futures Associations

AGENCY: Commodity Futures Trading Commission.

ACTION: Notice of 2020 schedule of fees.

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SUMMARY: The Commodity Futures Trading Commission (``CFTC'' or 
``Commission'') charges fees to designated contract markets and 
registered futures associations to recover the costs incurred by the 
Commission in the operation of its program of oversight of self-
regulatory organization rule enforcement programs, specifically 
National Futures Association (``NFA''), a registered futures 
association, and the designated contract markets. Fees collected from 
each self-regulatory organization are deposited in the Treasury of the 
United States as miscellaneous receipts. The calculation of the fee 
amounts charged for 2020 by this notice is based upon an average of 
actual program costs incurred during fiscal year (``FY'') 2017, FY 
2018, and FY 2019.

DATES: Each self-regulatory organization is required to remit 
electronically the applicable fee on or before March 22, 2021.

FOR FURTHER INFORMATION CONTACT: Anthony C. Thompson, Executive 
Director and Chief Administrative Officer, Commodity Futures Trading 
Commission; (202) 418-5697; Three Lafayette Centre, 1155 21st Street 
NW, Washington, DC 20581. For information on electronic payment, 
contact Jennifer Fleming; (202) 418-5034; Three Lafayette Centre, 1155 
21st Street NW, Washington, DC 20581.

SUPPLEMENTARY INFORMATION:

I. Background Information

A. General

    This notice relates to fees for the Commission's review of the rule 
enforcement programs at the registered futures associations \1\ and 
designated contract markets (``DCM''), each of which is a self-
regulatory organization (``SRO'') regulated by the Commission. The 
Commission recalculates the fees charged each year to cover the costs 
of operating this Commission program.\2\ The fees are set each year 
based on direct program costs, plus an overhead factor. The Commission 
calculates actual costs, then calculates an alternate fee taking volume 
into account, and then charges the lower of the two.\3\
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    \1\ National Futures Association is the only registered futures 
association.
    \2\ See Section 237 of the Futures Trading Act of 1982, 7 U.S.C. 
16a, and 31 U.S.C. 9701. For a broader discussion of the history of 
Commission fees, see 52 FR 46070, Dec. 4, 1987.
    \3\ 58 FR 42643, Aug. 11, 1993, and 17 CFR part 1, app. B.
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B. Overhead Rate

    The fees charged by the Commission to the SROs are designed to 
recover program costs, including direct labor costs and overhead. The 
overhead rate is calculated by dividing total Commission-wide overhead 
direct program labor costs into the total amount of the Commission-wide 
overhead pool. For this purpose, direct program labor costs are the 
salary costs of personnel working in all Commission programs. Overhead 
costs generally consist of the following Commission-wide costs: 
Indirect personnel costs (leave and benefits), rent, communications, 
contract services, utilities, equipment, and supplies. This formula has 
resulted in the following overhead rates for the most recent three 
years (rounded to the nearest whole percent): 169 percent for FY 2017, 
182 percent for FY 2018, and 174 percent for FY 2019.

C. Conduct of SRO Rule Enforcement Reviews

    Under the formula adopted by the Commission in 1993, the Commission 
calculates the fee to recover the costs of its rule enforcement reviews 
and examinations, based on the three-year average of the actual cost of 
performing such reviews and examinations at each SRO. The cost of 
operation of the Commission's SRO oversight program varies from SRO to 
SRO, according to the size and complexity of each SRO's

[[Page 6305]]

program. The three-year averaging computation method is intended to 
smooth out year-to-year variations in cost. Timing of the Commission's 
reviews and examinations may affect costs--a review or examination may 
span two fiscal years and reviews and examinations are not conducted at 
each SRO each year.
    As noted above, adjustments to actual costs may be made to relieve 
the burden on an SRO with a disproportionately large share of program 
costs. The Commission's formula provides for a reduction in the 
assessed fee if an SRO has a smaller percentage of United States 
industry contract volume than its percentage of overall Commission 
oversight program costs. This adjustment reduces the costs so that, as 
a percentage of total Commission SRO oversight program costs, they are 
in line with the pro rata percentage for that SRO of United States 
industry-wide contract volume.
    The calculation is made as follows: The fee required to be paid to 
the Commission by each DCM is equal to the lesser of actual costs based 
on the three-year historical average of costs for that DCM or one-half 
of average costs incurred by the Commission for each DCM for the most 
recent three years, plus a pro rata share (based on average trading 
volume for the most recent three years) of the aggregate of average 
annual costs of all DCMs for the most recent three years.
    The formula for calculating the second factor is: 0.5a + 0.5 vt = 
current fee. In this formula, ``a'' equals the average annual costs, 
``v'' equals the percentage of total volume across DCMs over the last 
three years, and ``t'' equals the average annual costs for all DCMs. 
NFA has no contracts traded; hence, its fee is based simply on costs 
for the most recent three fiscal years. This table summarizes the data 
used in the calculations of the resulting fee for each entity:

                                                    Table 1--Summary of Data Used in Fee Calculations
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                                                        Actual total costs
                                         ------------------------------------------------ 3-Year average   3-Year total      Adjusted      2020 Assessed
                                              FY 2017         FY 2018         FY 2019      actual costs      volume %      volume costs         fee
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Cantor Futures Exchange, L.P............         $60,045         $56,551  ..............         $38,866            0.02         $19,527         $19,527
CBOE Futures Exchange, LLC..............          31,026          16,033          40,517          29,192            1.40          21,600          21,600
Chicago Board of Trade..................          96,442           2,296          22,835          40,525           32.69         183,313          40,525
Chicago Mercantile Exchange, Inc........         472,157         235,127         383,995         363,760           42.23         392,507         363,760
Eris Exchange, LLC......................          53,010          33,170  ..............          28,727            0.01          14,397          14,397
ICE Futures U.S., Inc...................         199,090          50,096          73,464         107,550            6.86          87,993          87,993
Minneapolis Grain Exchange, Inc.........          42,226             438          39,525          27,396            0.05          13,944          13,944
Nasdaq OMX Futures Exchange, Inc........         251,200         109,413           1,741         120,785            0.59          63,311          63,311
New York Mercantile Exchange, Inc.......         212,798           3,397          45,425          87,206           12.77         107,290          87,206
Nodal Exchange, LLC.....................         100,600          33,162           2,312          45,358            0.06          22,996          22,996
North American Derivatives Exchange,              84,666           6,986         135,159          75,604            0.22          38,891          38,891
 Inc....................................
OneChicago, LLC.........................          36,444          61,276  ..............          32,573            0.20          17,276          17,276
                                         ---------------------------------------------------------------------------------------------------------------
    Subtotal............................       1,639,704         607,946         744,973         997,541          100.00         997,541         791,427
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National Futures Association............         660,710         507,673         540,821         569,735  ..............  ..............         569,735
                                         ---------------------------------------------------------------------------------------------------------------
    Total...............................       2,300,414       1,115,619       1,285,794       1,567,276          100.00         997,541       1,361,161
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    An example of how the fee is calculated for one exchange, the 
Chicago Board of Trade, is set forth here:

a. Actual three-year average costs = $40,525
b. The alternative computation is: [(.5) ($40,525)] + (.5) [(.3269048) 
($997,541)] = $183,313
c. The fee is the lesser of a or b; in this case $40,525

    As noted above, the alternative calculation based on contracts 
traded is not applicable to NFA because it is not a DCM and has no 
contracts traded. The Commission's average annual cost for conducting 
oversight review of the NFA rule enforcement program during fiscal 
years 2017 through 2019 was $569,735. The fee to be paid by the NFA for 
the current fiscal year is $569,735.

II. Schedule of Fees

    Fees for the Commission's review of the rule enforcement programs 
at the registered futures associations and DCMs regulated by the 
Commission are as follows:

                                            Table 2--Schedule of Fees
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                                                  3-Year average   3-Year total      Adjusted      2020 Assessed
                                                   actual costs      volume %      volume costs         fee
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Cantor Futures Exchange, L.P....................         $38,866            0.02         $19,527         $19,527
CBOE Futures Exchange, LLC......................          29,192            1.40          21,600          21,600
Chicago Board of Trade..........................          40,525           32.69         183,313          40,525
Chicago Mercantile Exchange, Inc................         363,760           42.23         392,507         363,760
Eris Exchange, LLC..............................          28,727            0.01          14,397          14,397
ICE Futures U.S., Inc...........................         107,550            6.86          87,993          87,993
Minneapolis Grain Exchange, Inc.................          27,396            0.05          13,944          13,944
Nasdaq OMX Futures Exchange, Inc................         120,785            0.59          63,311          63,311
New York Mercantile Exchange, Inc...............          87,206           12.77         107,290          87,206
Nodal Exchange, LLC.............................          45,358            0.06          22,996          22,996
North American Derivatives Exchange, Inc........          75,604            0.22          38,891          38,891
OneChicago, LLC.................................          32,573            0.20          17,276          17,276
                                                 ---------------------------------------------------------------
    Subtotal....................................         997,541          100.00         997,541         791,427
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[[Page 6306]]

 
National Futures Association....................         569,735  ..............  ..............         569,735
                                                 ---------------------------------------------------------------
    Total.......................................       1,567,276          100.00         997,541       1,361,161
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III. Payment Method

    The Debt Collection Improvement Act (DCIA) requires deposits of 
fees owed to the government by electronic transfer of funds. See 31 
U.S.C. 3720. For information about electronic payments, please contact 
Jennifer Fleming at (202) 418-5034 or <a href="/cdn-cgi/l/email-protection#fc969a90999195929bbc9f9a889fd29b938a"><span class="__cf_email__" data-cfemail="1d777b71787074737a5d7e7b697e337a726b">[email protected]</span></a>, or see the 
CFTC website at https://www.cftc.gov, specifically, https://www.cftc.gov/cftc/cftcelectronicpayments.htm.
    Fees collected from each self-regulatory organization shall be 
deposited in the Treasury of the United States as miscellaneous 
receipts. See 7 U.S.C 16a.

    Issued in Washington, DC, on this 13th day of January, 2021, by 
the Commission.
Robert Sidman,
Deputy Secretary of the Commission.
[FR Doc. 2021-01145 Filed 1-19-21; 8:45 am]
BILLING CODE 6351-01-P


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