Via Portal Submission January 9, 2023

 MGEX Submission No. 23-1

Mr. Christopher Kirkpatrick

Secretary of the Commission

Commodity Futures Trading Commission

Three Lafayette Centre

1155 21st Street NW

Washington, DC 20581

RE: Rule Certification Submission Pursuant to Regulation 40.6(a); Amendments 

to MGEX’s Risk Manual

Dear Mr. Kirkpatrick:

Pursuant to Commodity Exchange Act (“CEAct”) Section 5c(c) and Commodity Futures 

Trading Commission (“CFTC”) Regulation 40.6(a), the Minneapolis Grain Exchange, LLC 

(“MGEX” or “Exchange”) hereby submits this self-certification of certain amendments to 

MGEX’s Risk Management Principles Reference Manual (“Risk Manual”). MGEX has 

respectfully requested confidential treatment for such amendments to the Risk Manual, 

which are being submitted concurrently with this submission. The Exchange intends to 

implement the amendments ten business days following the filing of this submission. 

Overview of Amendments

MGEX has amended its Risk Manual, as shown in the attachment accompanying this 

submission, to make necessary updates and additions to remove language pertaining to 

the trading and clearing of futures on the U.S. Corporate Tax Rate Index and U.S. Capital 

Gains Tax Rate Index (together “TAX futures”) as well as to remove language pertaining 

to the trading and clearing of futures on the BRIXX Retail Index, BRIXX Office Index, 

BRIXX Residential Index, and the BRIXX Hospitality Index (collectively “BRIXX futures”). 

Revisions to the Risk Manual include removing all references to the the clearing of these 

contracts.

DCO Core Principles

In connection with updating the Risk Manual, the Exchange has reviewed the core 

principles for derivatives clearing organizations (“DCO Core Principles”) and has 
MINNEAPOLIS GRAIN EXCHANGE, LLC

400 South 4th Street | 130 Grain Exchange Building | Minneapolis, MN 55415

612-321-7101

mgex.com

determined that the amendments comply with the requirements of such principles. During 

the review, MGEX identified the following DCO Core Principles as potentially being 

impacted:

• DCO Core Principle B – Financial Resources: CFTC Regulation 39.11 requires a 

DCO to perform stress tests that will allow it to reasonably calculate the resources 

it is required to maintain. MGEX had previously updated its stress testing 

procedures to incorporate the clearing of TAX futures and BRIXX futures, thereby 

ensuring it was accurately monitoring the potential exposures of Clearing Members 

and maintaining sufficient financial and liquid resources. These changes removing 

language pertaining to the trading and clearing of TAX futures and BRIXX futures 

will maintain the Exchange’s ability to monitor and manage the adequacy of its 

financial and qualifying liquidity resources, and as such, they are consistent with 

the requirements of Core Principle B and CFTC Regulations 39.11 and 39.33.

• DCO Core Principle D – Risk Management: CFTC Regulation 39.13 requires 

DCOs to possess certain risk management tools and procedures, including 

establishing margin models. MGEX had previously added detailed margin 

methodology guidelines for the TAX futures and BRIXX futures products. These 

changes to remove language pertaining to the trading and clearing of TAX futures 

and BRIXX futures serve to update the Exchange’s risk management tools and 

procedures, and as such, the amendments are consistent with the requirements 

of Core Principle D, CFTC Regulations 39.13 and 39.36, and standards set by the 

European Securities and Markets Authority.

MGEX hereby certifies that the amendments to the Risk Manual comply with the CEAct 

and the CFTC regulations promulgated thereunder. The Exchange is not aware of any 

substantive opposing views expressed regarding the amendments or this filing. MGEX 

further certifies that, concurrent with this filing, a copy of the submission was posted on 

the Exchange website at the following link: http://www.mgex.com/regulation.html. If there 

are any questions regarding this submission, please contact me at (612) 321-7176 or 

jkrause@mgex.com. Thank you for your attention to this matter.
MINNEAPOLIS GRAIN EXCHANGE, LLC

400 South 4th Street | 130 Grain Exchange Building | Minneapolis, MN 55415

612-321-7101

mgex.com

Sincerely, 

James D. Krause

Associate Counsel, MGEX Clearing