MINNEAPOLIS GRAIN EXCHANGE 

August 17, 2009 

Mr. David Stawick, Secretary 

Commodity Futures Trading Commission 

Three Lafayette Centre 

1155 21 81 Street, N.W. 

Washington, DC 20581 

Received CFTC 

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C.f.T.C. 

OFFICE OF THE SECRETARIAT 

2009 RUG 18 Rr110 liS 

COMMENT 

SUBJECT: Account Ownership and Control Report 

Dear Mr. Stawick: 

The Minneapolis Grain Exchange ("MGEX" or "Exchange") would like to thank the Commodity 

Futures Trading Commission ("CFTC" or "Commission") for this opportunity to respond to the 

Commission's request for comment on the above referenced matter published in the July 2, 

2009 Federal Register Vol. 74, No. 126. 

The MGEX recognizes the value that the proposed Ownership and Control Report ("OCR") may · ·· ·· 

provide to different regulatory agencies, particularly the various CFTC divisions and offices. 

MGEX suggests there may be a better way to obtain the information than asking each exchange J 

to do so independently and for every account. The Exchange believes that the proposed . · 

method creates duplication and added costs that perhaps are unnecessary. 

First off, the proposal places the burdens on each exchange to collect data when the data the 

CFTC is requesting is not housed at each exchange. Rather, it is housed at the non-member 

futures commission merchants ("FCM") and clearing members that hold positions in a regulated 

product. Given sliCh, these entities may be forced to replicate the reporting process several 

times over in order to supply the data being requested by each exchange rather than by simply 

being requested to supply such data once directly to the Commission. This would alleviate the 

potential likelihood for dual reporting amongst reporting entities as well as be more cost 

effective by not adding additional reporting requirements by exchanges to each reporting entity 

where they or their customers hold positions. 

Secondly, the Exchange believes that only the largest position holders should be considered for 

the new reporting requirements. MGEX suggests requiring information for those positions that 

become reportable and any additional positions that may be tied to the same account ownership 

or control instead of attempting to gather information on every single account that may hold a 

position in a regulated product. Given this suggestion, perhaps a slight modification to the 

current reporting method for large trader and reportable positions may be the most cost effective 

and efficient solution. This method would focus attention on reportable positions while using the 

existing infrastructure in place which will likely result in gaining efficiencies and minimize 

additional expenses. . 

MGEX would be pleased to provide further comment on the following questions presented in the 

Federal Register release. 

111 Grain Exchange Building 400 South 4th Street Minneapolis, MN 55415-1413 

jbartz@mgex .com 800.827.4 7 46 612.321.7122 Fax: 612.339.1155 equal opportunity employer 
·Page 2 

1. Is there additional information, not included in Section II(A), that should be included in 

the OCR? 

MGEX believes there is sufficient information in the proposed OCR. However, orice again, the 

MGEX requests the CFTC consider limiting the data in the OCR to reportable positions. 

2. What is the lifecycle of the information required by the OCR? Who possesses it at a 

root level? From what types of entities will exchanges draw the information required by 

the OCR (e.g. exchange clearing members, non-member futures commission merchants, 

etc.)? How will exchanges obtain OCR information? 

The current process for Large Trader Reporting information appears sufficient including the 

frequency of reporting. The data for the current reporting requirements is obtained and 

maintained with the FCMs. MGEX would primarily contact the clearing members to obtain the 

proposed OCR required information. The collection of the data is expected to be a burdensome 

and manual process for the exchanges. However, the respective FCM has this information 

readily available. Accordingly, once again, MGEX would suggest consideration of utilizing the 

respective FCMs to report the OCR required information to expedite the process as well as 

potentially improve accuracy with a direct communication versus routing information to the 

clearing member and then on to the exchange. Further, FCMs are aware firsthand of changes 

to accounts, including new accounts, closed or deleted accounts and changes in control of 

accounts. 

3. Will OCR information be more difficult to acquire for some account types than for 

others? If so, what types of accounts will present a greater challenge and why? How can 

the challenge be overcome? 

Extra efforts will be needed to obtain and keep current detail information that involves omnibus 

accounts, index accounts with multiple investors, or any accounts with multiple owners, 

participants or controllers. Exchanges will have no option but to require non-member FCMs and 

clearing members to provide the information. 

4. The Commission expects that initially the OCR will be submitted in FIXML via FTP. Is 

there a better way to electronically transmit the OCR? Is there an existing FIXML report 

that may be used to transmit OCR information? If not, is there an existing FIXML report 

that can be easily modified to supply the information contained in the OCR? 

The Exchange believes the method for reporting should be uniform and FIXML seems 

appropriate. However as the MGEX earlier suggested, perhaps utilizing the existing 

infrastructure of Large Trader Reporting requirements· could be a more efficient strategy for 

implementation of the OCR requirements. 

5. The Commission anticipates that each exchange will initially transmit a "master file" 

containing the required information for every trading account number included in the 

Trade Capture Report during the previous month or longer. The master file will 

effectively establish a baseline of account information. Subsequently, each exchange 

would be required to file a weekly "change file" reporting only changes that occurred 

during the week (e.g. new accounts, deleted accounts, or changes to accounts already in 

the master file). Is there a more convenient way to provide the required information on a 

regular basis? Do changes occur so frequently that a change file should be submitted 
•Page 3 

daily instead of weekly? 

Please see our previous responses which identify more cost effective and efficient ways to 

obtain the data. 

6. What entities will have to report raw data to exchanges so that exchanges can compile 

the information required by the OCR? Since these entities will already be in possession 

of OCR information, what additional measures will they have to take to transmit it to 

exchanges or prepare it for transmission? What will be the dollar and staff-hour cost of 

those measures? To the extent possible, please itemize costs related to initial 

implementation as well as regular reporting costs. 

The proposed OCR required information would come from a variety of sources including 

clearing members and non-member FCMs. The MGEX defers to the FCM community for costs 

they will incur. However, the cost incurred by MGEX will be substantially more than if the FCMs 

were required to utilize their already deployed resources used today for the Large Trader 

Reporting process. 

7. How long will it take exchanges to assemble the necessary information and transmit 

the first OCR to the Commission? What will be the dollar and staff-hour costs associated 

with providing the OCR? To the extent possible, please itemize costs related to initial 

implementation as well as regular reporting. 

The Exchange believes the previous made suggestions for collecting this data are the most 

efficient and cost effective for both the FCMs and exchanges. Additionally, the MGEX is 

concerned about the amount of resources necessary for the reporting entities given that each 

exchange will be responsible for ensuring the accuracy of the information provided to them. 

8. Will the OCR impose any disparate .impact on small businesses? If so, how can it be 

minimized? Please describe and estimate the number of small entities that will be 

impacted. 

The Exchange believes that if the current infrastructure for Large Trader Reporting is utilized for 

OCR as suggested earlier, there would be minimal impact to the industry. On the other hand, 

the impact on smaller companies is likely to increase as a result of reporting to multiple 

exchanges and responding to their inquiries, rather than just reporting to the Commission. 

The MGEX thanks the Commission for the opportunity to comment on the advanced notification 

and appreciates the Commission's willingness to consider further comments prior to adopting a 

final decision on OCR reporting. If there are any questions regarding these comments, please 

contact me at (612) 321-7122. Thank you for your attention to this matter. 

Sincerely, 

Jesse Marie Bartz 

Assistant Corporate Secretary