MEMORANDUM OF UNDERSTANDING 

UNITED STATES 

COMMODITY FUTURES 

TRADING COMMISSION 

BETWEEN THE 

AND SUPERINTEND EN CIA 

DEVALORESY 

SEGUROSDE 

CHILE 

REGARDING FUTURES REGULATORY COOPERATION 

AND TECHNICAL ASSISTANCE 
l. The United States Commodity Futures Trading Commission (CFfC) was created by the 

United States Congress as an independent agency with the mandate to supervise and oversee 

commodity futures and options markets in the United States. 

2. The Superintendericia de Va]ores y Seguros (SVS) de Chile, the Chilean securities and 

insurance supervisor, is the designated agency under Decree Law N°3,538,· of 1980, for the 

supervision, surveilJance and regulation of the national securities, insurance and futures markets in 

Chile. 

3. The CFfC and the SVS (colJectively the Authorities), are jointly committed to maintaining 

open, fair, efficient and sound futures and options markets; recognize that the development and 

maintenance of domestic legal and regulatory structures is essential to market integrity and . 

investor protection; believe that international cooperation can facilitate the development and 

effective operation of futures and options markets; and desire to establish a mutually acceptable 

basis for cooperation, consultation and the provision of technical assistance. The CFfC and the 

SVS have reached the fo1lowing understanding with respect to cooperation, consultation, and the 

provision of technical assistance. 

CLAUSE 1 CONSULTATION REGARDING MA TIERS OF MUTUAL INTEREST 

Section I. General Principles 

1. This Memorandum ofUnderstanding Regarding Futures Regulatory Cooperation 

and Technical Assistance (MOU) describes the intent of the Authorities and does not create 

lega1ly binding obligations or supersede domestic law of either Authority. 

2. The Authorities recognize the need and desirabiJity of providing assistance, as set 

forth in Clauses II and III, to each other pursuant to this MOU. The provision of any such 

assistance should be consistent with the domestic Jaws of the Authorities and the availability of 

resources. Where the provision· of assistance would be contrary to the public interest of an 

Authority, such assistance may be denied. 

3. The Authorities intend to engage in a dialogue on all aspects of futureiind 

options regulation and on the development and operation of their futures and ·options markets. 
Section 2. Consultation 

The Authorities intend to consult periodica1ly about matters of mutual interest in order to 

promote cooperation and market integrity, and to further the protection of futures and options 

market participants. Such consultation may cover, among pther things, the development of 

prudential standards and conduct of business standards for the operation of futures businesses 

(brokers, dealers and markets), the development of clearance an~ settlement and other market 

systems, market oversight, and the administration of the Authorities' futures and options laws, 

rules, and regulations. The purpose of such consultation is to assist in the development of 

effective approaches to strengthening domestic and international futures and options markets. 

Section 3. Information Sharing 

The Authorities intend to share information on each other's laws, rules and regulations 

pertaining to futures markets and futures options markets, if applicable, and how those Jaws, 

rules and regulations are implemented and interpreted. 

CLAUSE li PROVISION OF TECHNICAL ASSISTANCE FOR TilE DEVELOPMENT OF 

TilE SUPERINTENDENCIA DE V ALORES Y SEGUR OS DE CHILE 

Section 1. Technical Assistance 

The CFfC intends to consult with and provide advice to the SVS for the development, 

administration, and operation of the futures and options markets in the Republic of Chile. Such 

consultation should identify specific types of technical assistance the Authorities believe are 

desirable and reasonable. The technical assistance may include the training of personnel as well 

as the provision of information and advice relating to the development of: 

a. Systems to improve and/or promote the risk management, price discovery 

and hedging fimctions of markets; 

b. Futures and options products and the basics of designing contracts not 

readily susceptible to manipulation; 

c. Order handling systems; 

d. Trade recording and comparison systems; 

e. Quotation and transaction data transmission systems; 

f.. Clearance and settlement mechamsms; 

g. Regulatory requirements and best practices relating to market 

professionals, products and markets; 

2 
h. 

). 

J. 

k. 

Systems and related regulatory mechanisms relating to financial 

survei11ance; 

Systems for effective market survei1Jance and enforcement programs; 

Disclosure and other procedures and practices to inform and protect 

futures and options customers and market participants; and 

Information on transparency. 

Section 2. Specific T ecbnical Assistance 

Specific technical assistance may be provided in the following manner: 

a. 

b. 

c. 

d. 

Connnent by CFfC staff on draft laws and regulations; 

Availability of CFfC staff and other relevant experts to provide 

consultation regarding futures and options markets; 

Genera] training sessions concerning futures and options regulation; and 

Internship programs of short duration for SVS personnel at the CFfC, 

conditioned upon the requisite legal authority to do so and the entering 

into of any necessary confidentiality agreements. 

Section 3. Availability 

The Authorities recognize that specific technical assistance is subject to the availability of 

resources. 

CLAUSE III COOPERA-TION 

Each Authority may, subject to Clause IV, Section 2, give assistance as to:· 

a. The granting of licenses, waivers, or exemptions for the conduct of futures 

business; 

b. The Jaws and regulations applicable to futUres busine5s; 

c. The laws and regulations applicable to futures exchanges and other types 

of markets; 

3 
d. 

e. 

f. 

CLAUSE IV 

Section 1. 

The oversight of futures exchanges by regulatory and market authorities; 

The prevention and detection of futures arid options .fraud and other 

irregularities or unlawful activities in comection with the offer, purchase 

or sale of any futures or options contract; and 

The prevention and detection of market manipulation. 

OPERATIONS 

Laws, Rules and Reguirements 

The Authorities have exchanged general information on the laws, rules and requirements 

applicable to the confidentiality and use of information and intend to abide by same. 

Section 2. Reguests 

Requests for assistance under Clause lll, procedures for making and executing such 

requests, permissible uses of information, confidentiality requirements, costs and other matters 

not explicitly incJuded in this MOU should be addressed on a case-by-case basis. 

Section 3. Official Contacts· 

To further ensure the effective operation of this MOU, and to facilitate communication 

between the Authorities, the Authorities hereby designate the contact officials set forth in 

Attachment A. 

CLAUSEV FUTURE UNDERSTANDINGS 

1. The Authorities plan to regularly review their efforts pursuant to this MOU with a 

view toward improving communication between them. In this regard.., when material additions or~ 

amendments to new United States and/or Chile futures and options-Jaws take effect.., the 

Authorities intend to consider whether this MOU should be supplemented or superseded. 

2. - The Authorities intend to move toward more formal information sharing 

arrangements after they have some experience with the operation of this MOU. 

4 
ATIACHMENT A 

The United States Commodity Futures Trading Commission designates as its contact offici a]: 

Director 

Office of International Affairs 

Commodity Futures Trading Conunission 

3 Lafayette Centre 

1155 21st Street~ NW 

Washington~ DC 20581-0001 

USA 

Tel: (202) 418 5645 

Fax: (202) 418 5548 

e-mail: intemationaJ@cftc.gov 

The Superintendencia de Vatores y Seguros de Chile designates as its contact official: 

Director 

Division de Estudios y ReJaciones lriternacionales 

Superintendencia de VaJores y Seguros 

Teatinos 120:. 6 Piso 

Santiago 

6500692 

CHILE 

Tel: (56 2) 549 5840 

Fax: (56 2) 549 5937 

e-mail: intemaciona1@svs.c1 

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CLAUSE VI EFFECTIVE DATE AND TERMINATION 

Section 1. Effective Date 

This MOU is effective from the date of its signing by the Authorities. 

Section 2. Tennination 

This MOU may be tenninated at any time by either Authority giving thirty days' written 

notice to the other Authority. ·If such notice is given~ this MOU continues to have effect with 

respect to all requests for assistance that are made before the effective date of notification until 

the requesting Authority terminates the matter for which assistance was requested. 

This MOU is executed in duplicate in W asbington~ DC on September 12~ 2002 

FOR TilE 

UNITED STATES COMMODITY 

FUTURES TRADING OMMISSION: 

5 

FOR THE 

SUPERINTENDENCIA DE V ALORES Y 

SEGUROS DE CHILE: