[Federal Register Volume 62, Number 221 (Monday, November 17, 1997)]
[Rules and Regulations]
[Pages 61226-61228]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-29995]


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COMMODITY FUTURES TRADING COMMISSION

17 CFR Part 15


Changes in Reporting Levels for Large Trader Reports

AGENCY: Commodity Futures Trading Commission.

ACTION: Final rulemaking.

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SUMMARY: The Commodity Futures Trading Commission (Commission) is 
amending its regulations to raise the nominal reporting level at which 
futures commission merchants, clearing members, foreign brokers, and 
traders must file large trader reports in Standard and Poors (S&P) 500 
futures from 300 to 600 contracts. Levels for filing reports in the E-
mini S&P 500 futures will remain at 300 contracts. The effect of this 
rule amendment is to maintain at current levels the amount of 
information the Commission receives concerning large traders in these 
contracts.

Effective Date: December 17, 1997.

For Further Information Contact: Lamont L. Reese, Commodity Futures 
Trading Commission, Division of

[[Page 61227]]

Economic Analysis, Three Lafayette Centre, 1155 21st Street, N.W., 
Washington, D.C. 20581, telephone (202) 418-5310.

SUPPLEMENTARY INFORMATION:

I. Background

    Reporting levels are set in futures to ensure that the Commission 
receives adequate information to carry out its market surveillance 
programs. These are designed to detect and prevent market congestion 
and price manipulation and to enforce speculative position limits. In 
addition, the information serves as a basis to gauge overall hedging 
and speculative uses of the futures markets, use of the markets by 
foreign participants, and other matters of public concern.
    Generally, Parts 17 and 18 of the regulations require reports from 
members of contract markets, FCMs, or foreign brokers (firms) and 
traders, respectively, when a trader holds a ``reportable position''; 
i.e., any open position held or controlled by a trader at the close of 
business in any one future of a commodity traded on any one contract 
market that is equal to or in excess of the quantities fixed by the 
commission in Sec. 15.03 of the regulations.\1\
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    \1\ Firms which carry accounts for traders who hold ``reportable 
positions'' are required to identify such accounts on a form 102 and 
report on the series '01 forms any reportable positions in the 
account, the delivery notices issued or stopped by the account and 
any exchanges of futures for physicals. Traders who own or control 
reportable positions are required to file annually a CFTC form 40 
giving certain background information concerning their trading in 
commodity futures and, on call by the Commission, must submit a form 
103 showing positions and transactions in the contract market 
specified in the call.
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    Recently, however, the Commission approved rule changes submitted 
by the Chicago Mercantile Exchange (CME) which reduce the size of the 
S&P futures contract from $500 to $250 per index point. To implement 
this change, the exchange doubled the size of existing open positions 
effective after the close of the market on October 31, 1997. This 
increased traders' position size relative to the Commission's current 
reporting level of 300 contracts, resulting in an increased reporting 
burden on the public and the processing of unneeded reports by the 
Commission. In order to maintain the current level of large trader 
information it receives, the Commission is raising the reporting level 
for S&P 500 futures from 300 to 600 contracts.
    The CME also currently trades a smaller size futures contract on 
the S&P 500 index. This contract, termed the ``E-mini,'' is valued at 
$10 per index point and is currently subject to the same 300-contract 
reporting level as the larger contract. Since the Commission desires to 
maintain the reporting level for the small contract at 300, the S&P E-
mini contract will be listed separately in Sec. 15.03 of the 
regulations.

II. Related Matters

A. Notice and Comment

    The Administrative Procedure Act, 5 U.S.C. 553(b), requires in most 
instances that a notice of proposed rulemaking be published in the 
Federal Register, and that opportunity for comment be provided when an 
agency promulgates new regulations. Section 553(b) sets forth an 
exception, however, when the agency for good cause finds (and 
incorporates the findings and a brief statement of its reasons) that 
notice and public procedure thereon are impracticable, unnecessary, or 
contrary to the public interest.
    The Commission finds that notice and public comments on the rule 
changes announced herein are unnecessary, because the amendments are 
routine determinations necessitated by technical changes to a 
currently-traded contract. These routine determinations are made to 
adjust reporting levels, when such changes lead to the receipt by the 
Commission of a larger number of reports than is necessary for 
efficient surveillance of the market. In this regard, it should be 
further noted that these amendments do not establish any new 
obligations under the Commodity Exchange Act (Act). On the contrary, 
these changes simplify compliance with the Act by not changing persons' 
reporting obligations under the rules in question.

B. The Regulatory Flexibility Act (RFA)

    The RFA, 5 U.S.C. 601 et seq., requires that agencies consider the 
impact of those rules on small businesses. The Commission has 
previously determined that large traders and FCMs are not ``small 
entities'' for purposes of the RFA, 47 FR 18618-18621 (April 30, 1982). 
Therefore, the Chairperson, on behalf of the Commission, hereby 
certifies, pursuant to 5 U.S.C. 605(b), that the action taken herein 
will not have a significant economic impact on a substantial number of 
small entities.

C. Paperwork Reduction Act (PRA)

    The PRA of 1995 (Pub. L. 104-13 (May 13, 1995)) imposes certain 
requirements on federal agencies (including the Commission) in 
connection with their conducting or sponsoring any collection of 
information as defined by the PRA. While this final rule imposes no 
additional burden, the group of rules (3038-0009) of which this is a 
part has the following burden:

Average burden hours per response--0.3607
Number of respondents--6181
Frequency of response--Daily

    Copies of the Office of Management and Budget approved information 
collection package associated with this rule may be obtained from Desk 
Officer, CFTC, Office of Management and Budget, room 10202, NEOB, 
Washington, DC 20503, (202) 395-7340.

List of Subjects in 17 CFR Part 15

    Brokers, Reporting and recordkeeping requirements.

    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, 7 U.S.C. 6g, 6i, 7, and 12a (1990), the Commission hereby 
amends chapter I of title 17 of the Code of Federal Regulations as 
follows:

PART 15--REPORTS--GENERAL PROVISIONS

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

    Authority: 7 U.S.C. 2, 4, 5, 6a, 6c(a)-(d), 6f, 6g, 6i, 6k, 6m, 
6n, 7, 9, 12a, 19, and 21; 5 U.S.C. 552 and 552(b).

    2. Section 15.03 is revised to read as follows:


Sec. 15.03  Quantities fixed for reporting.

    The quantities for the purpose of reports filed under Parts 17 and 
18 of this chapter are as follows:

------------------------------------------------------------------------
                         Commodity                             Quantity 
------------------------------------------------------------------------
Wheat (bushels)............................................      500,000
Corn (bushels).............................................      750,000
Soybeans (bushels).........................................      500,000
Oats (bushels).............................................      500,000
Cotton (bales).............................................        5,000
Frozen Concentrated Orange Juice...........................           50
Soybean Oil (contracts)....................................          175
Soybean Meal (contracts)...................................          175
Live Cattle (contracts)....................................          100
Feeder Cattle (contracts)..................................           50
Hogs (contracts)...........................................           50
Sugar No. 11 (contracts)...................................          300
Sugar No. 14 (contracts)...................................          100
Cocoa (contracts)..........................................          100
Coffee (contracts).........................................           50
Copper (contracts).........................................          100
Gold (contracts)...........................................          200
Silver bullion (contracts).................................          150
Platinum (contracts).......................................           50
No. 2 Heating Oil (contracts)..............................          250
Crude Oil, Sweet (contracts)...............................          300
Unleaded Gasoline (contracts)..............................          150
Natural Gas................................................          100
Long-Term U.S. Treasury Bonds (contracts)..................          500

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GNMA (contracts)...........................................          100
Three-Month (13-Week) U.S. Treasury Bills (contracts)......          150
Long-Term U.S. Treasury Notes (contracts)..................          500
Medium-Term U.S. Treasury Notes (contracts)................          300
Short-Term U.S. Treasury Notes (contracts).................          200
Three-Month Eurodollar Time Deposit Rates (contracts)......          850
Thirty-Day Interest Rates (contracts)......................          100
One-Month Libor Rates (contracts)..........................          100
Foreign Currencies (contracts).............................          200
U.S. Dollar Index (contracts)..............................           50
Standard and Poor's 500 Stock Price Index (contracts)......          600
Standard and Poor's 500 Stock Price Index, E-Mini                       
 (contracts)...............................................          300
New York Stock Exchange Composite Index (contracts)........           50
Amex Major Market Index, Maxi (contracts)..................          100
Nikkei Stock Index (contracts).............................           50
Municipal Bonds (contracts)................................          100
Value Line Average Index (contracts).......................           50
All Other Commodities (contracts)..........................           25
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    Issued in Washington, D.C., this 7th day of November 1997 by the 
Commission.

Jean A. Webb,
Secretary of the Commission.
[FR Doc. 97-29995 Filed 11-14-97; 8:45 am]
BILLING CODE 6351-01-P