COMMODITY FUTURES TRADING COMMISSION 

2033 K STREET, N.W., WASHINGTON, D.O. 20581 

(202) 254-B9S5 

(202) 254-3534 FACSIMILE 

DIVISION OF 

TRADING AND MARKETS November 19, 1990 

Re: 

Dear 

This is in response to your letter dated August 7, 1990, as 

supplemented by telephone conversations with Division staff, in 

which'you request our views on the application of the Disclosure 

Document requirements of Rule 4.21(a) and (e) 1/ to _ . . , a registered commodity pool operator ("CPO"), in connection with its operation of 

the ·Fund 

Based upon the representations made in your letter, as supplemented, we understand the facts to be as follows: 

The Fund's sole limited partner is 

The Fund will never have any other limited 

partner. In connection with the initial subscription by complied 

with CFTC Reg. §4.21. On an ongoing basis, 

is notified in advance of all changes 

in the Fund's advisory arrangements and of 

other material changes and is sent monthly 

and annual reports in accordance with CFTC 

Reg. §4.22. has disclosure documents 

for all of the current advisors and will receive 

such documents (and updates thereof) for all 

new advisors. In addition, the recordkeeping 

requirements of CFTC Reg. §4.23 are complied 

with in respect of the Fund. 

1/ Cornmis'sion rules referred to herein are found at 17 C.F.R. 

Ch. I (1990). 
Page 2 

From time to time intends to make 

additional subscriptions to the Fund. 

Rule 4.2l(a) provides in pertinent part that: 

No commodity pool operator registered or required to be registered under the Act may, 

directly or indirectly, solicit, accept or 

receive funds, securities or other property 

from a prospective participant in a pool that 

it operates or that it intends to operate 

unless, on or before the date it engages in 

that activity, the commodity pool operator 

delivers or causes to be delivered to the 

prospective participant a Disclosure Document 

for the pool. (Emphasis added.) 

Rule 4.21(e) prohibits a CPO from using a Disclosure Document 

dated more than six months from the date of its use to solicit 

prospective participants. 

The Disclosure Document requirement of Rule 4.2l(a) is intended to ensure that persons contemplating becoming investors in 

a CPO's pool are fully informed of all material facts before committing their funds, ll The updating requirement of Rule 4.2l(e) 

is intended to ensure that prospective investors receive current 

information. 11 With respect to , you have represented 

that it has received a Rule 4.2l(a) Disclosure Document prior to 

becoming a participant in the Fund, notice of all material changes 

to the information contained in that Disclosure Document as required by Rule 4.21(b), and the periodic and annual audited reports required by Rule 4.22. 

Based upon your representations that has been 

apprised of all material facts from the date of its solicitation 

to become a participant in the Fund to the present, and assuming 

that these representations remain true and correct, the Division 

will not recommend that the Commission take any enforcement action 

against if it accepts aqditional subscriptions to the 

Fund from without first delivering the Disclosure Document required by Rules 4.21(a) and (e). 

The position taken by this letter is based upon the representations that you have made to us. Any different, changed or 

omitted facts or conditions might require us to reach a different 

ll 44 Fed. Reg. 1918, 1920 (January 8, 1979). 

3/ 46 Fed. Reg. 26004, 26010 (May 8, 1981). 
Page 3 

conclusion. In this regard, we request that you notify us in the 

event that ' operation of the Fund, including its compliance with Rules 4.2l(b) and 4.22, changes in any way from that 

as represented to us. 

This position relates only to Rules 4.2l(a) and (e) and does 

not excuse from compliance with any other applicable 

requirements contained in the Commodity Exchange Act (the "Act") 

or the Commission's regulations thereunder. For example, it remains subject to the anti-fraud provisions of Section 4Q of the 

Act, !/ to the reporting requirements for traders set forth in 

Parts 15,.18 and 19 of the Commission's regulations, and to all 

other provisions of Rule 4.21. Finally, this position is that of 

the Division of Trading and Markets only. It does not necessarily represent the views of the Commission or any other office 

or division of the Commission. 

!/ 7 u.s.c. 6Q (1988). 

er· tru:m /' 

Andrea 

Director , Corcora~