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[Federal Register: November 17, 1997 (Volume 62, Number 221)]
[Rules and Regulations]
[Page 61226-61228]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr17no97-9]

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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

[[Page 61228]]


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
------------------------------------------------------------------------

    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
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