Federal Register / Vol. 62, No. 249 / Tuesday, December 30, 1997 / Notices 67839

Category Twelve-month limit

647/648 ................ 5,248,544 dozen of

which not more than

5,248,544 dozen

shall be in Categories 647–W/648–

W 16.

659–S ................... 1,601,702 kilograms.

835 ....................... 19,020 dozen.

Group II Subgroup

333/334/335, 341,

342, 350/650,

351, 447/448,

636, 641 and

651, as a group.

76,035,766 square

meters equivalent.

Within Group II Subgroup

333/334/335 ......... 292,416 dozen of

which not more than

158,392 dozen shall

be in Category 335.

341 ....................... 338,229 dozen.

342 ....................... 211,293 dozen.

350/650 ................ 135,358 dozen.

351 ....................... 351,522 dozen.

447/448 ................ 20,618 dozen.

636 ....................... 379,718 dozen.

641 ....................... 730,350 dozen of

which not more than

255,622 dozen shall

be in Category 641–

Y17.

651 ....................... 440,833 dozen.

Group III

Sublevel in Group III

845 ....................... 851,213 dozen.

1 Category 870; Category 369–L: only HTS

numbers 4202.12.4000, 4202.12.8020,

4202.12.8060, 4202.92.1500, 4202.92.3015

and 4202.92.6090; Category 670–L: only HTS

numbers 4202.12.8030, 4202.12.8070,

4202.92.3020, 4202.92.3030 and

4202.92.9025. 2 Category 369–S: only HTS number

6307.10.2005. 3 Category 369–O: all HTS numbers except

4202.12.4000, 4202.12.8020, 4202.12.8060,

4202.92.1500, 4202.92.3015, 4202.92.6090

(Category 369–L); and 6307.10.2005 (Category 369–S). 4 Category 669–P: only HTS numbers

6305.32.0010, 6305.32.0020, 6305.33.0010,

6305.33.0020 and 6305.39.0000. 5 Category 669–T: only HTS numbers

6306.12.0000, 6306.19.0010 and

6306.22.9030. 6 Category 669–O: all HTS numbers except

6305.32.0010, 6305.32.0020, 6305.33.0010,

6305.33.0020, 6305.39.0000 (Category 669–

P); 6306.12.0000, 6306.19.0010 and

6306.22.9030 (Category 669–T). 7 Category 670–H: only HTS numbers

4202.22.4030 and 4202.22.8050. 8 Category 670–O: all HTS numbers except

4202.22.4030 4202.22.8050 (Category 670–

H); 4202.12.8030, 4202.12.8070,

4202.92.3020, 4202.92.3030 and

4202.92.9025 (Category 670–L).

9 Category 359–C: only HTS numbers

6103.42.2025, 6103.49.8034, 6104.62.1020,

6104.69.8010, 6114.20.0048, 6114.20.0052,

6203.42.2010, 6203.42.2090, 6204.62.2010,

6211.32.0010, 6211.32.0025 and

6211.42.0010; Category 659–C: only HTS

numbers 6103.23.0055, 6103.43.2020,

6103.43.2025, 6103.49.2000, 6103.49.8038,

6104.63.1020, 6104.63.1030, 6104.69.1000,

6104.69.8014, 6114.30.3044, 6114.30.3054,

6203.43.2010, 6203.43.2090, 6203.49.1010,

6203.49.1090, 6204.63.1510, 6204.69.1010,

6210.10.9010, 6211.33.0010, 6211.33.0017

and 6211.43.0010. 10 Category 359–H: only HTS numbers

6505.90.1540 and 6505.90.2060; Category

659–H: only HTS numbers 6502.00.9030,

6504.00.9015, 6504.00.9060, 6505.90.5090,

6505.90.6090, 6505.90.7090 and

6505.90.8090. 11 Category 359–O: all HTS numbers except

6103.42.2025, 6103.49.8034, 6104.62.1020,

6104.69.8010, 6114.20.0048, 6114.20.0052,

6203.42.2010, 6203.42.2090, 6204.62.2010,

6211.32.0010, 6211.32.0025 and

6211.42.0010 (Category 359–C);

6505.90.1540 and 6505.90.2060 (Category

359–H). 12 Category 659–S: only HTS numbers

6112.31.0010, 6112.31.0020, 6112.41.0010,

6112.41.0020, 6112.41.0030, 6112.41.0040,

6211.11.1010, 6211.11.1020, 6211.12.1010

and 6211.12.1020. 13 Category 659–O: all HTS numbers except

6103.23.0055, 6103.43.2020, 6103.43.2025,

6103.49.2000, 6103.49.8038, 6104.63.1020,

6104.63.1030, 6104.69.1000, 6104.69.8014,

6114.30.3044, 6114.30.3054, 6203.43.2010,

6203.43.2090, 6203.49.1010, 6203.49.1090,

6204.63.1510, 6204.69.1010, 6210.10.9010,

6211.33.0010, 6211.33.0017 and

6211.43.0010 (Category 659–C);

6502.00.9030, 6504.00.9015, 6504.00.9060,

6505.90.5090, 6505.90.6090, 6505.90.7090,

6505.90.8090 (Category 659–H);

6112.31.0010, 6112.31.0020, 6112.41.0010,

6112.41.0020, 6112.41.0030, 6112.41.0040,

6211.11.1010, 6211.11.1020, 6211.12.1010

and 6211.12.1020 (Category 659–S). 14 Category 347–W: only HTS numbers

6203.19.1020, 6203.19.9020, 6203.22.3020,

6203.22.3030, 6203.42.4005, 6203.42.4010,

6203.42.4015, 6203.42.4025, 6203.42.4035,

6203.42.4045, 6203.42.4050, 6203.42.4060,

6203.49.8020, 6210.40.9033, 6211.20.1520,

6211.20.3810 and 6211.32.0040; Category

348–W: only HTS numbers 6204.12.0030,

6204.19.8030, 6204.22.3040, 6204.22.3050,

6204.29.4034, 6204.62.3000, 6204.62.4005,

6204.62.4010, 6204.62.4020, 6204.62.4030,

6204.62.4040, 6204.62.4050, 6204.62.4055,

6204.62.4065, 6204.69.6010, 6204.69.9010,

6210.50.9060, 6211.20.1550, 6211.20.6810,

6211.42.0030 and 6217.90.9050. 15 Category 640–Y: only HTS numbers

6205.30.2010, 6205.30.2020, 6205.30.2050

and 6205.30.2060. 16 Category 647–W: only HTS numbers

6203.23.0060, 6203.23.0070, 6203.29.2030,

6203.29.2035, 6203.43.2500, 6203.43.3500,

6203.43.4010, 6203.43.4020, 6203.43.4030,

6203.43.4040, 6203.49.1500, 6203.49.2015,

6203.49.2030, 6203.49.2045, 6203.49.2060,

6203.49.8030, 6210.40.5030, 6211.20.1525,

6211.20.3820 and 6211.33.0030; Category

648–W: only HTS numbers 6204.23.0040,

6204.23.0045, 6204.29.2020, 6204.29.2025,

6204.29.4038, 6204.63.2000, 6204.63.3000,

6204.63.3510, 6204.63.3530, 6204.63.3532,

6204.63.3540, 6204.69.2510, 6204.69.2530,

6204.69.2540, 6204.69.2560, 6204.69.6030,

6204.69.9030, 6210.50.5035, 6211.20.1555,

6211.20.6820, 6211.43.0040 and

6217.90.9060.

17 Category 641–Y: only HTS numbers

6204.23.0050, 6204.29.2030, 6206.40.3010

and 6206.40.3025.

The limits set forth above are subject to

adjustment pursuant to the current bilateral

agreement concerning imports of textile and

apparel products from Taiwan.

Products in the above categories exported

during 1997 shall be charged to the

applicable category limits for that year (see

directive dated November 4, 1996) to the

extent of any unfilled balances. In the event

the limits established for that period have

been exhausted by previous entries, such

products shall be charged to the limits set

forth in this directive.

These limits may be revised if Taiwan

becomes a member of the World Trade

Organization (WTO) and the WTO agreement

is applied to Taiwan.

The conversion factors are as follows:

Category

Conversion factors

(square meters equivalent/category unit)

300/301/607 ............. 8.5

333/334/335 ............. 33.75

352/652 .................... 11.3

359–C/659–C ........... 10.1

359–H/659–H ........... 11.5

369–L/670–L/870 ..... 3.8

633/634/635 ............. 34.1

638/639 .................... 12.5

In carrying out the above directions, the

Commissioner of Customs should construe

entry into the United States for consumption

to include entry for consumption into the

Commonwealth of Puerto Rico.

The Committee for the Implementation of

Textile Agreements has determined that

these actions fall within the foreign affairs

exception to the rulemaking provisions of 5

U.S.C. 553(a)(1).

Sincerely,

J. Hayden Boyd,

Acting Chairman, Committee for the

Implementation of Textile Agreements.

[FR Doc. 97–33910 Filed 12–29–97; 8:45 am]

BILLING CODE 3510–DR–F

COMMITTEE FOR THE

IMPLEMENTATION OF TEXTILE

AGREEMENTS

Announcement of Import Restraint

Limits for Certain Cotton, Wool and

Man-Made Fiber Textile Products

Produced or Manufactured in the

Republic of Turkey

December 22, 1997.

AGENCY: Committee for the

Implementation of Textile Agreements

(CITA).

ACTION: Issuing a directive to the

Commissioner of Customs establishing

limits.

EFFECTIVE DATE: January 1, 1998.

FOR FURTHER INFORMATION CONTACT: Roy

Unger, International Trade Specialist,
67840 Federal Register / Vol. 62, No. 249 / Tuesday, December 30, 1997 / Notices

Office of Textiles and Apparel, U.S.

Department of Commerce, (202) 482–

4212. For information on the quota

status of these limits, refer to the Quota

Status Reports posted on the bulletin

boards of each Customs port or call

(202) 927–5850. For information on

embargoes and quota re-openings, call

(202) 482–3715.

SUPPLEMENTARY INFORMATION:

Authority: Section 204 of the Agricultural

Act of 1956, as amended (7 U.S.C. 1854);

Executive Order 11651 of March 3, 1972, as

amended.

The import restraint limits for textile

products, produced or manufactured in

Turkey and exported during the periods

January 1, 1998 through March 27, 1998

and January 1, 1998 through December

31, 1998 are based on limits notified to

the Textiles Monitoring Body pursuant

to the Uruguay Round Agreement on

Textiles and Clothing (ATC), and

Memoranda of Understanding (MOUs)

dated July 19, 1995, between the

Governments of the United States and

the Republic of Turkey.

In the letter published below, the

Chairman of CITA directs the

Commissioner of Customs to establish

the 1998 limits. The limits for certain

categories have been reduced for

carryforward applied in 1997.

A description of the textile and

apparel categories in terms of HTS

numbers is available in the

CORRELATION: Textile and Apparel

Categories with the Harmonized Tariff

Schedule of the United States (see

Federal Register notice 62 FR 66057,

published on December 17, 1997).

J. Hayden Boyd,

Acting Chairman, Committee for the

Implementation of Textile Agreements.

Committee for the Implementation of Textile

Agreements

December 22, 1997.

Commissioner of Customs,

Department of the Treasury, Washington, DC

20229.

Dear Commissioner: Pursuant to section

204 of the Agricultural Act of 1956, as

amended (7 U.S.C. 1854); Executive Order

11651 of March 3, 1972, as amended; and the

Uruguay Round Agreement on Textiles and

Clothing (ATC); and Memoranda of

Understanding (MOUs) dated July 19, 1995

between the Governments of the United

States and the Republic of Turkey, you are

directed to prohibit, effective on January 1,

1998, entry into the United States for

consumption and withdrawal from

warehouse for consumption of cotton, wool

and man-made fiber textile products in the

following categories, produced or

manufactured in Turkey and exported during

the periods January 1, 1998 through March

27, 1998 (Categories 352/652) and January 1,

1998 through December 31, 1998, in excess

of the following levels of restraint:

Category Restraint limit

Fabric Group

219, 313, 314, 315,

317, 326, 617,

625/626/627/628/

629, as a group.

175,846,733 square

meters of which not

more than

40,184,564 square

meters shall be in

Category 219; not

more than

48,114,466 square

meters shall be in

Category 313; not

more than

28,575,690 square

meters shall be in

Category 314; not

more than

38,398,585 square

meters shall be in

Category 315; not

more than

40,184,564 square

meters shall be in

Category 317; not

more than 4,464,950

square meters shall

be in Category 326,

and not more than

26,789,711 square

meters shall be in

Category 617.

Sublevel in Fabric

Group

625/626/627/628/629 18,089,753 square

meters of which not

more than 7,235,901

square meters shall

be in Category 625;

not more than

7,235,901 square

meters shall be in

Category 626; not

more than 7,235,901

square meters shall

be in Category 627;

not more than

7,235,901 square

meters shall be in

Category 628; and

not more than

7,235,901 square

meters shall be in

Category 629.

Limits not in a group

200 ........................... 1,695,542 kilograms.

300/301 .................... 8,255,474 kilograms.

335 ........................... 356,446 dozen.

336/636 .................... 839,628 dozen.

338/339/638/639 ...... 4,939,309 dozen of

which not more than

3,704,483 dozen

shall be in Categories 338–S/339–

S/638–S/639–S1.

340/640 .................... 1,568,112 dozen of

which not more than

445,991 dozen shall

be in Categories

340–Y/640–Y2.

341/641 .................... 1,548,584 dozen of

which not more than

542,004 dozen shall

be in Categories

341–Y/641–Y3.

Category Restraint limit

342/642 .................... 934,681 dozen.

347/348 .................... 5,085,297 dozen of

which not more than

1,768,887 dozen

shall be in Categories 347–T/348–

T 4.

350 ........................... 500,846 dozen.

351/651 .................... 800,767 dozen.

352/652 .................... 617,370 dozen.

361 ........................... 1,782,231 numbers.

369–S5 .................... 1,842,488 kilograms.

410/624 .................... 1,103,680 square meters of which not

more than 671,909

square meters shall

be in Category 410.

448 ........................... 37,871 dozen.

604 ........................... 2,126,771 kilograms.

611 ........................... 53,205,155 square

meters.

1 Category 338–S: only HTS numbers

6103.22.0050, 6105.10.0010, 6105.10.0030,

6105.90.8010, 6109.10.0027, 6110.20.1025,

6110.20.2040, 6110.20.2065, 6110.90.9068,

6112.11.0030 and 6114.20.0005; Category

339–S: only HTS numbers 6104.22.0060,

6104.29.2049, 6106.10.0010, 6106.10.0030,

6106.90.2510, 6106.90.3010, 6109.10.0070,

6110.20.1030, 6110.20.2045, 6110.20.2075,

6110.90.9070, 6112.11.0040, 6114.20.0010

and 6117.90.9020; Category 638–S: all HTS

numbers except 6109.90.1007, 6109.90.1009,

6109.90.1013 and 6109.90.1025; Category

639–S: all HTS numbers except

6109.90.1050, 6109.90.1060, 6109.90.1065

and 6109.90.1070. 2 Category 340–Y: only HTS numbers

6205.20.2015, 6205.20.2020, 6205.20.2046,

6205.20.2050 and 6205.20.2060; Category

640–Y: only HTS numbers 6205.30.2010,

6205.30.2020, 6205.30.2050 and

6205.30.2060. 3 Category 341–Y: only HTS numbers

6204.22.3060, 6206.30.3010, 6206.30.3030

and 6211.42.0054; Category 641–Y: only HTS

numbers 6204.23.0050, 6204.29.2030,

6206.40.3010 and 6206.40.3025. 4 Category 347–T: only HTS numbers

6103.19.2015, 6103.19.9020, 6103.22.0030,

6103.42.1020, 6103.42.1040, 6103.49.8010,

6112.11.0050, 6113.00.9038, 6203.19.1020,

6203.19.9020, 6203.22.3020, 6203.42.4005,

6203.42.4010, 6203.42.4015, 6203.42.4025,

6203.42.4035, 6203.42.4045, 6203.49.8020,

6210.40.9033, 6211.20.1520, 6211.20.3810

and 6211.32.0040; Category 348–T: only HTS

numbers 6104.12.0030, 6104.19.8030,

6104.22.0040, 6104.29.2034, 6104.62.2006,

6104.62.2011, 6104.62.2026, 6104.62.2028,

6104.69.8022, 6112.11.0060, 6113.00.9042,

6117.90.9060, 6204.12.0030, 6204.19.8030,

6204.22.3040, 6204.29.4034, 6204.62.3000,

6204.62.4005, 6204.62.4010, 6204.62.4020,

6204.62.4030, 6204.62.4040, 6204.62.4050,

6204.69.6010, 6304.69.9010. 6210.50.9060,

6211.20.1550, 6211.20.6810, 6211.42.0030

and 6217.90.9050. 5 Category 369–S: only HTS number

6307.10.2005.

The limits set forth above are subject to

adjustment pursuant to the provisions of the

ATC and administrative arrangements

notified to the Textiles Monitoring Body.

Products in the above categories exported

during 1997 shall be charged to the

applicable category limits for that year (see

directive dated October 16, 1996) to the
Federal Register / Vol. 62, No. 249 / Tuesday, December 30, 1997 / Notices 67841

1See Vision and Strategies for the Future: Facing

the Challenges of 1997 through 2002, published by

the Commission (September 1997).

2 7 U.S.C. 1 et seq.

3See Commodity Exchange Authority

Administrative Determination No. 238 (September

4, 1974).

4 53 FR 46911 (November 21, 1988).

extent of any unfilled balances. In the event

the limits established for that period have

been exhausted by previous entries, such

products shall be charged to the limits set

forth in this directive.

In carrying out the above directions, the

Commissioner of Customs should construe

entry into the United States for consumption

to include entry for consumption into the

Commonwealth of Puerto Rico.

The Committee for the Implementation of

Textile Agreements has determined that

these actions fall within the foreign affairs

exception of the rulemaking provisions of 5

U.S.C. 553(a)(1).

Sincerely,

J. Hayden Boyd,

Acting Chairman, Committee for the

Implementation of Textile Agreements.

[FR Doc. 97–33918 Filed 12–29–97; 8:45 am]

BILLING CODE 3510–DR–F

COMMODITY FUTURES TRADING

COMMISSION

Concept Release on the Denomination

of Customer Funds and the Location of

Depositories

AGENCY: Commodity Futures Trading

Commission.

ACTION: Request for comment.

SUMMARY: The Commodity Futures

Trading Commission (‘‘Commission’’) is

publishing this release to obtain the

views of the public on how to address

risks related to holding segregated funds

offshore or in foreign currencies. The

Commission wishes to consider how to

update and otherwise to revise existing

regulatory standards to avoid inhibiting

transnational commodity futures

activities or causing undue costs or

operational inconvenience, without

increasing risks to market participants.

This initiative is part of the

Commission’s recently adopted strategic

plan, which includes ensuring ‘‘sound

financial practices of clearing

organizations and firms holding

customer funds’’ and facilitating ‘‘the

continued development of an effective,

flexible, regulatory environment

responsive to evolving market

conditions.’’ 1

The Commodity Exchange Act

(‘‘Act’’) 2 requires that all money,

securities and property received by

futures commission merchants

(‘‘FCMs’’) to margin, guarantee, or

secure customer trades or contracts on

domestic contract markets, or accruing

to customers as a result of these trades

or contracts, be segregated. Until 1988,

the Commission generally required that

such money, securities and property

(hereinafter collectively referred to as

‘‘customer funds’’) be held in the United

States (‘‘U.S.’’) with the exception of

certain funds held on behalf of nonU.S.-domiciled customers.3

In November 1988, the Commission

issued Financial and Segregation

Interpretation No. 12, ‘‘Deposit of

Customer Funds in Foreign

Depositories’’ (‘‘Interpretation No. 12’’).4

Interpretation No. 12 permits customer

funds to be held in depositories located

outside of the U.S., subject to

limitations and conditions intended for

the protection of these funds. At the

time Interpretation No. 12 was issued,

the Commission stated its intention to

‘‘monitor experience under this

interpretation * * * to alter or

supplement the conditions for keeping

segregated funds offshore as such

experience renders advisable.’’ Various

developments since 1988 make it

appropriate to revisit this area.

Date: Comments must be received on

or before March 2, 1998.

FOR FURTHER INFORMATION CONTACT:

France M.T. Maca, Special Counsel,

Division of Trading and Markets,

Commodity Futures Trading

Commission, Three Lafayette Center,

1155 21st Street, N.W. Washington, D.C.

20581. Telephone: (202) 418–5482.

Table of Contents

I. Background

A. Current Regulatory Requirements

1. Commodity Regulation

2. Bankruptcy Regulation

3. Banking Regulation

B. Developments Since the Issuance of

Interpretation No. 12

II. Policy Considerations

A. Goals

B. Risks

III. Potential Approaches

A. Permissible Denominations of Obligations

1. Alternatives

2. Discussion

B. Permissible Denominations of Assets

1. Alternatives

2. Discussion

C. Permissible Locations of Segregated

Funds

1. Alternatives

2. Discussion

D. Qualifications of Depositories

1. Alternatives

2. Discussion

E. Segregation and Net Capital Treatment

1. Alternatives

2. Discussion

F. Bankruptcy Treatment

1. Alternatives

2. Discussion

IV. A Specific Approach

V. Request for Comment

SUPPLEMENTARY INFORMATION:

I. Background

A. Current Regulatory Requirements

1. Commodity Regulation

The maintenance and location of

customer funds is prescribed by Section

4d of the Act which requires that each

FCM:

Treat and deal with all money, securities,

and property received by such [FCM] to

margin, guarantee, or secure the trades or

contracts of any customer of such [FCM], or

accruing to such customer as the result of

such trades or contracts, as belonging to such

customer. Such money, securities, and

property shall be separately accounted for

and shall not be commingled with the funds

of such [FCM] or be used to margin or

guarantee the trades or contracts, or to secure

or extend the credit, of any customer or

person other than the one from whom the

same are held.

It further provides that:

It shall be unlawful for any person,

including but not limited to any clearing

agency of a contract market and any

depository, that has received any money,

securities, or property for deposit in a

separate account as provided in paragraph (2)

of this section, to hold, dispose of, or use any

such money, securities, or property as

belonging to the depositing [FCM] or any

person other than the customers of such

[FCM].

The Commission’s segregation

requirements are set forth in Regulations

1.20–1.30, 1.32 and 1.36, 17 CFR 1.20–

1.30, 1.32 and 1.36. They provide,

among other things, that a customer’s

funds: must be accounted for separately

by the FCM; may not be commingled

with the FCM’s own funds or those of

any other person; must be available

immediately upon demand; and must be

used only to margin or to secure

contracts traded on or subject to the

rules of a designated contract market.

Neither Section 4d of the Act nor these

regulations address the holding of

customer funds offshore or in foreign

currencies.

Interpretation No. 12 permits the

deposit of U.S. customer funds offshore,

subject to conditions intended to ensure

consistency with the segregation

requirements of the Act and ‘‘generally

to prevent the dilution of customer

funds held in segregation in the United

States.’’ Accordingly, Interpretation No.

12 limits the circumstances under

which funds may be held offshore;

requires specified qualifications for

foreign depositories; requires a certain