Commodity End-User Relief Act

To reauthorize the Commodity Futures Trading Commission, to ensure protections of futures customers, to provide relief for farmers, ranchers, and end-users that manage risk to help keep consumer costs low, and for other purposes. 1. Short title; table of contents (a) Short title This Act may be cited as the Commodity End-User Relief Act (b) Table of contents The table of contents for this Act is as follows: Sec. 1. Short title; table of contents. TITLE I—Consumer Protection Sec. 101. Enhanced protections for futures customers. Sec. 102. Electronic confirmation of customer funds. Sec. 103. Notice and certifications providing additional customer protections. Sec. 104. Futures commission merchant compliance. Sec. 105. Certainty for futures customers and market participants. TITLE II—Commodity Futures Trading Commission Reforms Sec. 201. Extension of operations. Sec. 202. Clarification of exemptive authority. Sec. 203. Privilege retention. Sec. 204. Judicial review of Commission rules. Sec. 205. Report on status of any application of metals exchange to register as a foreign board of trade; deadline for action on application. Sec. 206. Predominantly engaged. Sec. 207. Public interest exemptions. TITLE III—End-User Relief Sec. 301. Transactions with utility special entities. Sec. 302. Relief for grain elevator operators, agricultural producers, agricultural counterparties, and commercial market participants. Sec. 303. Relief for end-users who use physical contracts with volumetric optionality and treatment of Federal home loan bank products. Sec. 304. Study of swap dealer de minimis exemption level. Sec. 305. Models for non-bank swap dealers. Sec. 306. Bona fide hedge defined to protect end-user risk management needs. Sec. 307. Exemption of qualified charitable organizations from designation and regulation as commodity pool operators. TITLE IV—Technical corrections Sec. 401. Correction of cross-references. Sec. 402. Elimination of obsolete references to derivative transaction execution facilities. Sec. 403. Elimination of obsolete references to electronic trading facilities. Sec. 404. Elimination of obsolete references to exempt boards of trade. Sec. 405. Elimination of obsolete reference to significant price discovery contract. Sec. 406. Clarifications of retail foreign currency. Sec. 407. Elimination of obsolete references to dealer options. Sec. 408. Correction of references to designated contract markets. Sec. 409. Compliance report flexibility. Sec. 410. Reservations. Sec. 411. Flexibility for registered entities. Sec. 412. Elimination of obsolete reference to alternative swap execution facilities. Sec. 413. Elimination of redundant references to types of registered entities. Sec. 414. Clarification of Commission authority over swaps trading. Sec. 415. Elimination of duplicative reference to Commission. Sec. 416. Miscellaneous corrections. Sec. 417. Elimination of report due in 1986. I Consumer Protection 101. Enhanced protections for futures customers Section 17 of the Commodity Exchange Act ( 7 U.S.C. 21 (t) Enhanced protections for futures customers Each registered futures association shall submit to the Commission rules that— (1) require each member of the association that is a futures commission merchant to maintain written policies and procedures regarding the maintenance of— (A) the residual interest of the member, as described in section 1.23 of title 17, Code of Federal Regulations (or successor regulations), in any customer segregated funds of the member, as identified in section 1.20 of that title (or successor regulations), and in any foreign futures and foreign options customer secured amount funds of the member, as identified in section 30.7 of that title (or successor regulations); and (B) the residual interest of the member, as described in section 22.2(e)(4) of that title (or successor regulations), in any cleared swaps customer collateral of the member, as identified in section 22.2 of that title (or successor regulations); and (2) govern the withdrawal, transfer, or disbursement by any member, as described in section 1.23 of that title (or successor regulations), of the association, that is a futures commission merchant, of the residual interest of the member in any customer segregated funds as provided in section 1.20 of that title (or successor regulations), in any foreign futures and foreign options customer secured amount funds, identified as provided in section 30.7 of that title (or successor regulations), and in any cleared swaps customer collateral, identified as provided in section 22.2 of that title (or successor regulations). . 102. Electronic confirmation of customer funds Section 17 of the Commodity Exchange Act ( 7 U.S.C. 21 (u) Electronic confirmation of customer funds Each registered futures association shall submit to the Commission rules that require any member of the association that is a futures commission merchant— (1) to use an electronic system or systems to report financial and operational information to the association or another party designated by the registered futures association, including information related to customer segregated funds accounts, foreign futures and foreign options customer secured amount funds accounts, and cleared swaps customer collateral accounts, in accordance with such terms, conditions, documentation standards, and regular time intervals as are established by the registered futures association; (2) to instruct each depository, including any bank, trust company, derivatives clearing organization, or futures commission merchant, holding customer segregated funds under section 1.20 of title 17, Code of Federal Regulations (or successor regulations), foreign futures and foreign options customer secured amount funds under section 30.7 of that title (or successor regulations), or cleared swaps customer collateral under section 22.2 of that title (or successor regulations), to report balances in section 1.20 customer segregated funds accounts, section 30.7 foreign futures and foreign options customer secured amount funds accounts, and section 22.2 cleared swaps customer collateral accounts of the futures commission merchant, to the registered futures association or another party designated by the registered futures association, in the form, manner, and interval prescribed by the registered futures association; and (3) to hold section 1.20 customer segregated funds, section 30.7 foreign futures and foreign options customer secured amount funds and section 22.2 cleared swaps customer collateral in a depository that reports the balances in those accounts of the futures commission merchant held at the depository to the registered futures association or another party designated by the registered futures association in the form, manner, and interval prescribed by the registered futures association. . 103. Notice and certifications providing additional customer protections Section 17 of the Commodity Exchange Act ( 7 U.S.C. 21 (v) Notification required A futures commission merchant that has adjusted net capital in an amount less than the amount required by regulations established by the Commission or a self-regulatory organization of which the futures commission merchant is a member shall immediately notify the Commission and the self-regulatory organization of that occurrence. (w) Insufficient funds in segregated accounts A futures commission merchant that does not hold a sufficient amount of funds in segregated accounts for futures customers under section 1.20 of title 17, Code of Federal Regulations (or successor regulations), in foreign futures and foreign options secured amount accounts for foreign futures and foreign options secured amount customers under section 30.7 of that title (or successor regulations), or in segregated accounts for cleared swap customers under section 22.2 of that title (or successor regulations), as required by regulations established by the Commission or a self-regulatory organization of which the futures commission merchant is a member, shall immediately notify the Commission and the self-regulatory organization of that occurrence. (x) Internal compliance program assessment report Not later than the last day of such period as is established by the Commission after the end of each fiscal year, each futures commission merchant shall file with the Commission a report from the chief compliance officer of the futures commission merchant containing an assessment of the internal compliance programs of the futures commission merchant. . 104. Futures commission merchant compliance (a) In general Section 4d(a) of the Commodity Exchange Act ( 7 U.S.C. 6d(a) (1) by redesignating paragraphs (1) and (2) as subparagraphs (A) and (B), respectively, and indenting appropriately; (2) by striking Sec. 4d. It shall be unlawful 4d. Dealing by unregistered futures commission merchants or introducing brokers prohibited (a) Registration requirements and duties (1) In general It shall be unlawful ; and (3) by adding at the end the following: (2) Residual interest requirement Any rules or regulations requiring a futures commission merchant to maintain a residual interest in accounts held for the benefit of customers in amounts at least sufficient to exceed the sum of all uncollected margin deficits of the customers shall provide that a futures commission merchant shall meet the residual interest requirement as of the end of each business day calculated as of the close of business on the previous business day. . (b) Conforming amendments (1) Section 4d(h) of the Commodity Exchange Act ( 7 U.S.C. 6d(h) Notwithstanding subsection (a)(2) Notwithstanding subsection (a)(1)(B) (2) Section 15(c)(3)(C) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78o(c)(3)(C) 4d(a)(2) 4d(a)(1)(B) 105. Certainty for futures customers and market participants Section 20(a) of the Commodity Exchange Act ( 7 U.S.C. 24(a) (1) in paragraph (4), by striking and (2) in paragraph (5), by striking the period at the end and inserting ; and (3) by adding at the end the following: (6) that cash, securities, or other property of the estate, including the trading or operating accounts of the commodity broker and commodities held in inventory by the commodity broker, shall be included in customer property, subject to any otherwise unavoidable security interest, or otherwise unavoidable contractual offset or netting rights of creditors (including rights set forth in a rule or bylaw of a derivatives clearing organization or a securities clearing agency) in respect of the property, but only to the extent that the property that is otherwise customer property is insufficient to satisfy the net equity claims of public customers (as that term may be defined by the Commission by rule or regulation) of the commodity broker. . II Commodity Futures Trading Commission Reforms 201. Extension of operations Section 12(d) of the Commodity Exchange Act ( 7 U.S.C. 16(d) 2013 2019 202. Clarification of exemptive authority Section 4(c)(1) of the Commodity Exchange Act ( 7 U.S.C. 6(c)(1) (1) in the matter preceding subparagraph (A), by inserting , or any swap, otherwise subject to subsection (a) (2) by striking except that— (B) the Commission except that the Commission 203. Privilege retention Section 8 of the Commodity Exchange Act ( 7 U.S.C. 12 (1) by redesignating subsections (h) and (i) as subsections (i) and (j), respectively; and (2) by inserting after subsection (g) the following: (h) Sharing privileged information with other authorities (1) Definitions In this subsection: (A) Foreign law enforcement authority The term foreign law enforcement authority (B) Privilege The term privilege (2) Privileged information provided by the Commission The Commission shall not be considered to have waived any privilege by transferring information to or permitting that information to be used in accordance with subsection (e). (3) Nondisclosure of privileged information provided to the Commission The Commission shall not be compelled to disclose privileged information obtained from any foreign futures authority, or foreign law enforcement authority, if the authority has in good faith determined and represented to the Commission that the information is privileged. (4) Nonwaiver of privileged information provided to the Commission The entities listed in subsection (e) shall not be considered to have waived any privilege by transferring information to or permitting information to be used by the Commission. . 204. Judicial review of Commission rules The Commodity Exchange Act ( 7 U.S.C. 1 et seq. 24. Judicial review of Commission rules (a) In general Except as provided in subsection (e), a person adversely affected by a rule of the Commission promulgated under this Act may obtain review of the rule in the United States Court of Appeals for the District of Columbia Circuit or the United States Court of Appeals for the circuit where the party resides or has the principal place of business, by filing in the court, not later than 60 days after publication in the Federal Register of the entry of the rule, a written petition requesting that the rule be set aside. (b) Action by Commission After a written petition described in subsection (a) has been filed— (1) the clerk of the court shall transmit to an officer designated by the Commission for that purpose a copy of the petition; and (2) the Commission shall file in the court the record on which the rule complained of is entered, as provided in section 2112 of title 28, United States Code, and the Federal Rules of Appellate Procedure. (c) Jurisdiction of the court On the filing of the petition, the court has jurisdiction, which becomes exclusive on the filing of the record, to affirm and enforce or to set aside the rule in whole or in part. (d) Requirements The court shall affirm and enforce the rule unless the action of the Commission in promulgating the rule is found to be— (1) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law; (2) contrary to constitutional right, power, privilege, or immunity; (3) in excess of statutory jurisdiction, authority, or limitations, or without statutory authorization; or (4) without observance of procedure required by law. (e) District court alternative Notwithstanding the direct review process authorized by subsection (a), a person adversely affected by a rule of the Commission promulgated under this Act may, in the alternative, obtain review by filing an action in the United States District Court for the judicial district where the party resides or has the principal place of business or in the United States District Court for the District of Columbia. . 205. Report on status of any application of metals exchange to register as a foreign board of trade; deadline for action on application (a) Report to Congress Not later than 90 days after the date of enactment of this Act, the Commodity Futures Trading Commission shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a written report describing— (1) the status of the review by the Commission of any application submitted by a metals exchange to register with the Commission under section 4(b)(1) of the Commodity Exchange Act ( 7 U.S.C. 6(b)(1) (2) the status of Commission negotiations with foreign regulators regarding aluminum warehousing; and (3) the status of consultations with all United States market participants concerning metals exchanges and warehousing, including major producers and consumers. (b) Deadline for action Not later than September 30, 2017, the Commission shall take action on any application described in subsection (a)(1) that is submitted to the Commission on or before August 14, 2012. 206. Predominantly engaged Section 2(h)(7)(C) of the Commodity Exchange Act ( 7 U.S.C. 2(h)(7)(C) (iv) Regulations (I) In general Not later than 90 days after the date of enactment of this clause, the Commission shall promulgate regulations to define the term predominantly engaged (II) Revenue requirement Regulations under this clause shall provide that an entity will not be considered to be predominantly engaged in activities that are in the business of banking or financial in nature if the consolidated revenues of the entity derived from such activities constitute less than 85 percent of the total consolidated revenues of the entity. (III) Determination For purposes of subclause (II), in determining the percentage of the revenues of an entity that are derived from activities that are in the business of banking or financial in nature, all revenues that are, or result from, transactions used to hedge or mitigate commercial risk shall be excluded. . 207. Public interest exemptions Section 4(c)(6) of the Commodity Exchange Act ( 7 U.S.C. 6(c)(6) , on the condition that an exemption pursuant to this paragraph shall include an exemption from section 22, requirements of this Act III End-User Relief 301. Transactions with utility special entities (a) In general Section 1a(49) of the Commodity Exchange Act ( 7 U.S.C. 1a(49) (E) Certain transactions with a utility special entity In making a determination to exempt pursuant to subparagraph (D), the Commission shall treat a utility operations-related swap entered into with a utility special entity as if the swap were entered into with an entity that is not a special entity (as defined in section 4s(h)(2)(C)). . (b) Reporting transactions in utility operations-related swaps Section 4r(a)(3) of the Commodity Exchange Act ( 7 U.S.C. 6r(a)(3) (D) Transactions in utility operations-related swaps Transactions in utility operations-related swaps shall be reported pursuant to this section. . (c) Utility operations-related swap Section 1a(47)(A)(iii) of the Commodity Exchange Act ( 7 U.S.C. 1a(47)(A)(iii) (1) in subclause (XXI), by striking and (2) in subclause (XXII), by adding and (3) by adding at the end the following: (XXIII) a utility operations-related swap; . (d) Definitions Section 1a of the Commodity Exchange Act ( 7 U.S.C. 1a (52) Utility operations-related swap The term utility operations-related swap (A) is entered into by a utility to hedge or mitigate a commercial risk; (B) is not a contract, agreement, or transaction based on, derived on, or referencing— (i) an interest rate, credit, equity, or currency asset class; (ii) except as used for fuel for electric energy generation, a metal, agricultural commodity, or crude oil or gasoline commodity of any grade; or (iii) any other commodity or category of commodities identified for this purpose in a rule or order adopted by the Commission in consultation with the appropriate Federal and State regulatory commissions; and (C) is associated with— (i) the generation, production, purchase, or sale of natural gas or electric energy, the supply of natural gas or electric energy to a utility, or the delivery of natural gas or electric energy service to utility customers; (ii) fuel supply for the facilities or operations of a utility; (iii) compliance with an electric system reliability obligation; (iv) compliance with an energy, energy efficiency, conservation, or renewable energy or environmental law, regulation, or government order applicable to a utility; or (v) any other electric energy or natural gas swap to which a utility is a party. (53) Utility special entity The term utility special entity (A) owns or operates, or anticipates owning or operating, an electric or natural gas facility or an electric or natural gas operation; (B) supplies, or anticipates supplying, natural gas and or electric energy to another utility special entity; (C) has, or anticipates having, public service obligations under Federal, State, or local law (including regulations) to deliver electric energy or natural gas service to customers; or (D) is a Federal power marketing agency (as defined in section 3 of the Federal Power Act ( 16 U.S.C. 796 . 302. Relief for grain elevator operators, agricultural producers, agricultural counterparties, and commercial market participants The Commodity Exchange Act is amended by inserting after section 4t ( 7 U.S.C. 6t 4u. Recordkeeping requirements applicable to nonregistered members of certain registered entities (a) In general Except as provided in section 4(a)(3), a member of a designated contract market or a swap execution facility that is not registered with the Commission and not required to be registered with the Commission in any capacity shall satisfy the recordkeeping requirements of this Act and any recordkeeping rule, order, or regulation under this Act by maintaining a written record of each transaction in a contract for future delivery, option on a future, swap, swaption, trade option, and related cash or forward transactions. (b) Sufficiency A written record described in subsection (a) shall be sufficient if the written record includes the final agreement between the parties and the material economic terms of the transaction. . 303. Relief for end-users who use physical contracts with volumetric optionality and treatment of Federal home loan bank products Section 1a(47)(B) of the Commodity Exchange Act ( 7 U.S.C. 1a(47)(B) (1) in clause (ix), by striking and (2) in clause (x), by striking the period at the end and inserting a semicolon; and (3) by adding at the end the following: (xi) any option in a nonfinancial commodity for which exercise is intended to result in a physical delivery obligation; and (xii) any advance by a Federal Home Loan Bank. . 304. Study of swap dealer de minimis exemption level (a) In general The Commodity Futures Trading Commission shall conduct a study of the appropriate de minimis exemption level of swap dealing under section 1a(49)(D) of the Commodity Exchange Act ( 7 U.S.C. 1a(49)(D) (b) Considerations In conducting the study described in subsection (a), the Commission may consider— (1) the potential impact of modifying the de minimis threshold; (2) whether the de minimis threshold should be increased or decreased; (3) the factors that are useful for identifying swap dealing activity, including the application of the dealer trader distinction for that purpose, and the potential use of objective tests or safe harbors as part of the analysis; and (4) any other factors, or any other analysis of swap data and information relating to swaps, that the Commission considers to be relevant. (c) Regulation required (1) In general Based on the information gathered in the study under this section, the Commission, through a rulemaking, shall promulgate a regulation that sets an appropriate swap dealer de minimis exemption level. (2) Existing exemption level (A) In general The swap dealer de minimis exemption level in effect on the date of enactment of this Act shall remain in effect until changed by the Commission through a rulemaking described in paragraph (1). (B) Effectiveness Any Commission regulation that changes the swap dealer de minimis exemption level shall take effect not less than 1 year after the date on which the final regulation is published in the Federal Register. 305. Models for non-bank swap dealers (a) In general Section 4s(e) of the Commodity Exchange Act ( 7 U.S.C. 6s(e) (1) in paragraph (2)(B), in the matter preceding clause (i), by striking The Commission In consultation with the prudential regulators and the Securities and Exchange Commission, the Commission (2) in paragraph (3)(D)— (A) in clause (ii), in the matter preceding subclause (I), by inserting and in consultation with each other practicable (B) by adding at the end the following: (iii) Financial models To the extent that swap dealers and major swap participants that are banks are permitted to use financial models approved by the prudential regulators or the Securities and Exchange Commission to calculate minimum capital requirements and minimum initial and variation margin requirements, including the use of noncash collateral, the Commission shall, in consultation with the prudential regulators and the Securities and Exchange Commission and to the maximum extent practicable, permit the use of comparable financial models by swap dealers and major swap participants that are not banks. . (b) Conforming amendment Section 15F(e) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78o–10(e) (1) in paragraph (2)(B), in the matter preceding clause (i), by striking The Commission In consultation with the prudential regulators and the Commodity Futures Trading Commission, the Commission (2) in paragraph (3)(D)— (A) in clause (ii), in the matter preceding subclause (I), by inserting and in consultation with each practicable (B) by adding at the end the following: (iii) Financial models To the extent that security-based swap dealers and major security-based swap participants that are banks are permitted to use financial models approved by the prudential regulators or the Commodity Futures Trading Commission to calculate minimum capital requirements and minimum initial and variation margin requirements, including the use of noncash collateral, the Commission shall, in consultation with the Commodity Futures Trading Commission and to the maximum extent practicable, permit the use of comparable financial models by security-based swap dealers and major security-based swap participants that are not banks. . 306. Bona fide hedge defined to protect end-user risk management needs Section 4a(c) of the Commodity Exchange Act ( 7 U.S.C. 6a(c) (1) in paragraph (1), in the second sentence— (A) by striking may shall (B) by striking future for which future, to be determined by the Commission, for which either an appropriate swap is available or (2) in paragraph (2)— (A) in the matter preceding subparagraph (A), by striking subsection (a)(2) position as paragraphs (2) and (5) of subsection (a) for swaps, contracts of sale for future delivery, or options on the contracts or commodities, a bona fide hedging transaction or position is (B) in subparagraph (A)(ii), by striking of risks or management of current or anticipated risks (3) by adding at the end the following: (3) Bona fide hedging transaction The Commission may further define, by rule or regulation, what constitutes a bona fide hedging transaction, if the rule or regulation is consistent with the requirements of subparagraphs (A) and (B) of paragraph (2). . 307. Exemption of qualified charitable organizations from designation and regulation as commodity pool operators (a) Exclusion from definition of commodity pool Section 1a(10) of the Commodity Exchange Act ( 7 U.S.C. 1a(10) (C) Exclusion The term commodity pool investment company 15 U.S.C. 80a–3(c) . (b) Inapplicability of prohibition on use of instrumentalities of interstate commerce by unregistered commodity trading advisor Section 4m of the Commodity Exchange Act ( 7 U.S.C. 6m (1) by striking Sec. 4m. 4m. Use of mails or other means or instrumentalities of interstate commerce by commodity trading advisors and commodity pool operators (a) Prohibition (1) In general It ; (2) in the second sentence— (A) by striking The provisions of this section (2) Exceptions (A) Commodity trading advisors (i) In general Subject to clause (ii) and except as provided in subparagraphs (B) and (C), this section ; (B) by striking commodity trading advisor who is a (1) dealer (I) dealer ; (C) by striking or (2) nonprofit (II) nonprofit ; (D) by striking Commodity Futures Trading Commission Act of 1974; if the advice by the person described in clause (1) or (2) of this sentence (ii) Applicability Clause (i) only applies if the advice by the person described in subclause (I) or (II) of clause (i) ; (E) by striking business: business. (F) by striking Provided (B) Complaints against excepted persons A person described in subclause (I) or (II) of clause (i) shall be subject to proceedings under section 14. (C) Charitable organizations This section shall not apply to any commodity trading advisor that is— (i) a charitable organization, as defined in section 3(c)(10)(D)(iii) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–3(c)(10)(D)(iii) (I) any such charitable organization; or (II) an investment trust, syndicate, or similar form of enterprise excluded from the definition of investment company 15 U.S.C. 80a–3(c)(10) (ii) any plan, company, or account described in section 3(c)(14) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–3(c)(14) investment company 15 U.S.C. 80a–3(c)(14) ; (3) by striking (2) Nothing in this Act (b) Relationship to other law Nothing in this Act ; (4) by striking (3) Exception Paragraph (1) shall not apply (c) Exception (1) In general Subsection (a) shall not apply ; (5) by striking (B) Engaged primarily (2) Engaged primarily For purposes of paragraph (1) ; (6) by striking (C) Commodity interests (3) Commodity interests For purposes of this subsection ; and (7) by adding at the end the following: (d) Disclosure concerning excluded charitable organizations The operator of or advisor to any investment trust, syndicate, or similar form of enterprise excluded from the definition of commodity pool 15 U.S.C. 80a–3(c)(10) 15 U.S.C. 80a–7(e) . IV Technical corrections 401. Correction of cross-references (a) Section 2(h)(8)(A)(ii) of the Commodity Exchange Act ( 7 U.S.C. 2(h)(8)(A)(ii) 5h(f) of this Act 5h(g) (b) Section 5c(c)(5)(C)(i) of the Commodity Exchange Act ( 7 U.S.C. 7a–2(c)(5)(C)(i) section 1a(2)(i)) section 1a(19)(A)) (c) Section 23(f) of the Commodity Exchange Act ( 7 U.S.C. 26(f) section 7064 section 706 402. Elimination of obsolete references to derivative transaction execution facilities (a) Section 1a of the Commodity Exchange Act ( 7 U.S.C. 1a (1) in paragraph (12)(B)(vi), by striking or derivatives transaction execution facility (2) in paragraph (34)— (A) by striking the paragraph designation and heading and inserting the following: (34) Member ; and (B) by striking or derivatives transaction execution facility (3) in paragraph (35)(B)(iii)(I), by striking or registered derivatives transaction execution facility (b) Section 2 of the Commodity Exchange Act ( 7 U.S.C. 2 (1) in subsection (a)— (A) in paragraph (1)— (i) in subparagraph (C)— (I) in clause (ii), in the matter preceding subclause (I)— (aa) by striking , or register a derivatives transaction execution facility that trades or executes, (bb) by striking , and no derivatives transaction execution facility shall trade or execute such contracts of sale (or options on such contracts) for future delivery (cc) by striking or the derivatives transaction execution facility, (II) in clause (v)— (aa) in subclause (I), by striking , or any derivatives transaction execution facility on which such contract or option is traded, (bb) in subclause (II), by striking or derivatives transaction execution facility (cc) in subclause (V), by striking or registered derivatives transaction execution facility (ii) in subparagraph (D)— (I) in clause (i)— (aa) in the matter preceding subclause (I)— (AA) by striking , or register a derivatives transaction execution facility (BB) by striking , or registered as a derivatives transaction execution facility for, (bb) in subclause (IV), by striking registered derivatives transaction execution facility, (II) in clause (ii)— (aa) by striking subclause (I) and inserting the following: (I) the transaction is conducted on, or subject to, the rules of a board of trade that has been designated by the Commission as a contract market in the security futures product; or ; (bb) in subclause (II)— (AA) by striking (II) the contract (II) (aa) the contract ; and (BB) by striking or registered derivatives transaction execution facility (cc) in subclause (III)— (AA) by striking or registered derivatives transaction execution facility member (BB) by striking (III) the security (bb) the security ; and (III) in clause (vi)(III)(aa), by striking and registered derivatives transaction execution facilities (B) in paragraph (9)(B)(ii)— (i) by striking or registration (ii) by striking or derivatives transaction execution facility (iii) in the second sentence, by striking or register (iv) in the fourth sentence— (I) by striking , registering, (II) by striking , registration (2) in subsection (c)(2), by striking or a derivatives transaction execution facility (c) Section 4 of the Commodity Exchange Act ( 7 U.S.C. 6 (1) in subsection (a)— (A) in paragraph (1), by striking or derivatives transaction execution facility (B) in paragraph (3), by striking or derivatives transaction execution facility (2) in subsection (c)— (A) in paragraph (1), in the matter preceding subparagraph (A), by striking or registered as a contract market or derivatives transaction execution facility as a contract market (B) in paragraph (2)(B)(ii), by striking “or derivatives transaction execution facility”. (d) Section 4a of the Commodity Exchange Act ( 7 U.S.C. 6a (1) in subsection (a)(1)— (A) by striking or derivatives transaction execution facilities (B) by striking or derivatives transaction execution facility (2) in subsection (e)— (A) by striking , derivatives transaction execution facility, (B) by striking or derivatives transaction execution facility (e) Section 4c(g) of the Commodity Exchange Act ( 7 U.S.C. 6c(g) or derivatives transaction execution facility (f) Section 4d of the Commodity Exchange Act ( 7 U.S.C. 6d or derivatives transaction execution facility (g) Section 4e of the Commodity Exchange Act ( 7 U.S.C. 6e or derivatives transaction execution facility (h) Section 4f of the Commodity Exchange Act ( 7 U.S.C. 6f or derivatives transaction execution facility (i) Section 4i of the Commodity Exchange Act ( 7 U.S.C. 6i or derivatives transaction execution facility (j) Section 4j of the Commodity Exchange Act ( 7 U.S.C. 6j (1) in the section heading, by striking and registered derivatives transaction execution facilities (2) in subsection (a), in the first sentence, by striking and registered derivatives transaction execution facility (3) in subsection (b), in the matter preceding paragraph (1), by striking or registered derivatives transaction execution facility (4) in subsection (c), in the matter preceding paragraph (1), by striking or registered derivatives transaction execution facility members (k) Section 4k(5) of the Commodity Exchange Act ( 7 U.S.C. 6k(5) or registered derivatives transaction execution facility (l) Section 4 l l or registered derivatives transaction execution facilities (m) Section 4p of the Commodity Exchange Act ( 7 U.S.C. 6p (1) in subsection (a), in the third sentence, by striking contract markets, or derivatives transaction execution facilities or contract markets (2) in subsection (b), by striking derivatives transaction execution facility, (n) Section 5(e) of the Commodity Exchange Act ( 7 U.S.C. 7(e) (1) by striking the subsection designation and heading and all that follows through a contract for (e) Current agricultural commodities A contract for ; and (2) by striking paragraph (2). (o) Section 5c of the Commodity Exchange Act ( 7 U.S.C. 7a–2 (1) in subsection (b), by striking , derivatives transaction execution facility, (2) in subsection (f)— (A) in the matter preceding paragraph (1), by striking and registered derivatives transaction execution facility (B) in paragraph (1), by striking or registered derivatives transaction execution facility (p) Section 6 of the Commodity Exchange Act is amended— (1) by striking the section designation (42 Stat. 1001, chapter 39) and all that follows through Any person 7 U.S.C. 8 6. Application for designation as contract market (a) Application Any person ; (2) in subsection (a) ( 7 U.S.C. 8 (A) in the first sentence, by striking or registered as a contract market or derivatives transaction execution facility as a contract market (B) in the last sentence, by striking or register (3) in subsections (a) and (b) ( 7 U.S.C. 8 (A) by striking or derivatives transaction execution facility (B) by striking or registration (q) Section 6a of the Commodity Exchange Act ( 7 U.S.C. 10a (1) in subsection (a), by striking or registered as a contract market or a derivatives transaction execution facility exclude as a contract market shall exclude (2) in subsection (b)— (A) by striking or registered (B) by striking or a derivatives transaction execution facility (r) Section 6d(1) of the Commodity Exchange Act ( 7 U.S.C. 13a–2(1) derivatives transaction execution facility, 403. Elimination of obsolete references to electronic trading facilities (a) Section 1a of the Commodity Exchange Act ( 7 U.S.C. 1a (1) in paragraph (18)(A)(x), by striking (other than an electronic trading facility with respect to a significant price discovery contract) (2) in paragraph (40)— (A) in subparagraph (D), by adding and (B) in subparagraph (E), by striking ; and (C) by striking subparagraph (F). (b) Section 2(a)(1)(A) of the Commodity Exchange Act ( 7 U.S.C. 2(a)(1)(A) (including significant price discovery contracts) (c) Section 4a of the Commodity Exchange Act ( 7 U.S.C. 6a (1) in subsection (b)— (A) in paragraph (1), by striking with respect to a significant price discovery contract (B) in paragraph (2), by striking any contract price discovery contract any contract market or swap execution facility (2) in subsection (e)— (A) in the first sentence— (i) by striking or by any electronic trading facility (ii) by striking or on an electronic trading facility (iii) by striking or electronic trading facility (B) in the second sentence, by striking or electronic trading facility with respect to a significant price discovery contract (d) Section 4g(a) of the Commodity Exchange Act ( 7 U.S.C. 6g(a) and in any significant price discovery contract traded or executed on an electronic trading facility or any agreement, contract, or transaction that is treated by a derivatives clearing organization, whether registered or not registered, as fungible with a significant price discovery contract; (e) Section 4i of the Commodity Exchange Act ( 7 U.S.C. 6i , or any significant price discovery contract traded or executed on an electronic trading facility or any agreement, contract, or transaction that is treated by a derivatives clearing organization, whether registered or not registered, as fungible with a significant price discovery contract (f) Section 5c(b) of the Commodity Exchange Act ( 7 U.S.C. 7a–2(b) (1) in paragraph (1)— (A) by striking or electronic trading facility with respect to a significant price discovery contract (B) by striking that is not an electronic trading facility (2) in paragraph (2), by striking or electronic trading facility (3) in paragraph (3), by striking or electronic trading facility (g) Section 6(b) of the Commodity Exchange Act ( 7 U.S.C. 8(b) or electronic trading facility (h) Section 12(e)(2) of the Commodity Exchange Act ( 7 U.S.C. 16(e)(2) in the case of— in the case of an agreement, contract, or transaction that is excluded from this Act under subsection (c) or (f) of section 2 of this Act or title IV of the Commodity Futures Modernization Act of 2000 (as enacted by section 1(a)(5) of the Consolidated Appropriations Act, 2001 ( Public Law 106–554 404. Elimination of obsolete references to exempt boards of trade (a) Section 1a(18)(A)(x) of the Commodity Exchange Act ( 7 U.S.C. 1a(18)(A)(x) (b) Section 12(e)(1)(B)(i) of the Commodity Exchange Act ( 7 U.S.C. 16(e)(1)(B)(i) 405. Elimination of obsolete reference to significant price discovery contract Section 1a of the Commodity Exchange Act ( 7 U.S.C. 1a (46) Reserved . 406. Clarifications of retail foreign currency Section 2(c)(2) of the Commodity Exchange Act ( 7 U.S.C. 2(c)(2) (1) in subparagraph (B)— (A) by striking (gg) (ee) (B) in clause (i)(II), by redesignating item (ff) as item (ee); (C) in clause (iii), by striking item (aa), (bb), (ee), or (ff) of clause (i)(II) of this subparagraph item (aa), (bb), or (dd) of clause (i)(II) (D) in clause (iv)— (i) in subclauses (I) and (II), by striking (ee), or (ff) or (dd) (ii) in subclause (I)(bb), by inserting , or otherwise act as a commodity trading advisor with respect to any agreement, contract, or transaction described in clause (i) (iii) in subclause (IV)(aa), by striking (ff) (dd) (2) in subparagraph (C)— (A) by striking (ee), or (ff) or (dd) (B) by striking item (aa) through (ff) items (aa) through (dd) (C) in clause (iii)(I)(bb), by inserting , or otherwise act as a commodity trading advisor with respect to any agreement, contract, or transaction described in clause (i) 407. Elimination of obsolete references to dealer options (a) In general Section 4c of the Commodity Exchange Act ( 7 U.S.C. 6c (1) by striking subsections (d) and (e); and (2) by redesignating subsections (f) and (g) as subsections (d) and (e), respectively. (b) Conforming amendments (1) Section 2(d) of the Commodity Exchange Act ( 7 U.S.C. 2(d) (g) of (e) of (2) Section 4f(a)(4)(A)(i) of the Commodity Exchange Act ( 7 U.S.C. 6f(a)(4)(A)(i) , (d), (e), and (g) and (e) (3) Section 4k(5)(A) of the Commodity Exchange Act ( 7 U.S.C. 6k(5)(A) , (d), (e), and (g) and (e) (4) Section 5f(b)(1)(A) of the Commodity Exchange Act ( 7 U.S.C. 7b–1(b)(1)(A) , (e), and (g) and (e) (5) Section 9(a)(2) of the Commodity Exchange Act ( 7 U.S.C. 13(a)(2) through (e) of subsection 4c and (c) of section 4c 408. Correction of references to designated contract markets (a) Section 4a(c)(1) of the Commodity Exchange Act ( 7 U.S.C. 6a(c)(1) an exchange a designated contract market (b) Section 4b(c) of the Commodity Exchange Act ( 7 U.S.C. 6b(c) (1) by striking the exchange the designated contract market (2) by striking such exchange that designated contract market (c) Section 4g(e) of the Commodity Exchange Act ( 7 U.S.C. 6g(e) the exchange each designated contract market and swap execution facility (d) Section 4s(h)(7)(A) of the Commodity Exchange Act ( 7 U.S.C. 6s(h)(7)(A) an exchange a designated contract market (e) Section 8c of the Commodity Exchange Act ( 7 U.S.C. 12c (1) in subsection (a)— (A) in paragraph (1), by striking exchange registered entity (B) in paragraph (2)— (i) in the first sentence— (I) by striking an exchange a registered entity (II) by striking the exchange the registered entity (ii) in the second sentence— (I) by striking An exchange A registered entity (II) by striking the exchange the registered entity (2) in subsection (b)— (A) in the first sentence— (i) by striking an exchange a registered entity (ii) by striking the exchange the registered entity (B) in the second sentence, by striking exchange registered entity (3) in subsection (c), by striking exchange registered entity 409. Compliance report flexibility Section 4s(k)(3) of the Commodity Exchange Act ( 7 U.S.C. 6s(k)(3) (B) Requirements A compliance report under subparagraph (A) shall— (i) include a certification that, under penalty of law, the compliance report is materially accurate and complete; and (ii) be furnished at such time as the Commission determines, by rule, regulation, or order, to be appropriate. . 410. Reservations (a) Section 5 of the Commodity Exchange Act ( 7 U.S.C. 7 (b) Reserved . (b) The Commodity Exchange Act is amended by inserting after section 5 ( 7 U.S.C. 7 5a. Reserved . (c) Section 5b of the Commodity Exchange Act (7 U.S.C.7a–1) is amended after subsection (i) the following: (j) Reserved . (d) The Commodity Exchange Act is amended by inserting after section 5c ( 7 U.S.C. 7a–2 5d. Reserved . 411. Flexibility for registered entities Section 5c(b) of the Commodity Exchange Act ( 7 U.S.C. 7a–2(b) contract market registered entity 412. Elimination of obsolete reference to alternative swap execution facilities Section 5h(h) of the Commodity Exchange Act ( 7 U.S.C. 7b–3(h) alternative 413. Elimination of redundant references to types of registered entities Section 6b of the Commodity Exchange Act ( 7 U.S.C. 13a as set forth in sections 5 through 5c 414. Clarification of Commission authority over swaps trading Section 8a of the Commodity Exchange Act ( 7 U.S.C. 12a (1) in paragraph (7)— (A) in the matter preceding subparagraph (A), by inserting the protection of swaps traders and to assure fair dealing in swaps, appropriate for (B) in subparagraph (A), by inserting swaps or conditions in (C) in subparagraph (B), by inserting or swaps future delivery (2) in paragraph (9), in the first sentence— (A) by inserting swap or or liquidation of any (B) by inserting swap or margin levels on any 415. Elimination of duplicative reference to Commission Section 13(c) of the Commodity Exchange Act ( 7 U.S.C. 13c(c) or the Commission 416. Miscellaneous corrections (a) Section 1a of the Commodity Exchange Act ( 7 U.S.C. 1a (1) in paragraph (12)(A)(i)(II), by adding a semicolon at the end; and (2) in paragraph (19)— (A) by redesignating clauses (i) through (iv) as subparagraphs (A) through (D), respectively, and indenting the subparagraphs appropriately; and (B) in each of subparagraphs (B) and (D) (as so redesignated)— (i) by redesignating subclauses (I) and (II) as clauses (i) and (ii), respectively, and indenting the clauses appropriately; and (ii) by striking clause (i) subparagraph (A) (b) Section 2(a)(1)(C) of the Commodity Exchange Act ( 7 U.S.C. 2(a)(1)(C) (1) in clause (ii), by indenting subclause (III) appropriately; (2) by indenting clause (iii) appropriately; (3) in clause (iv), by striking under or under (4) by indenting clause (v) appropriately; and (5) in clause (v)(VI), by striking III (III) (c) Section 2(c)(1) of the Commodity Exchange Act ( 7 U.S.C. 2(c)(1) section, 5b, or section 5b or (d) Section 4(c)(3)(H) of the Commodity Exchange Act ( 7 U.S.C. 6(c)(3)(H) state State (e) Section 4c of the Commodity Exchange Act ( 7 U.S.C. 6c (c) Regulations The Commission shall issue regulations to continue to permit the trading of options on contract markets under such terms and conditions that the Commission from time to time may prescribe. . (f) Section 4d(b) of the Commodity Exchange Act ( 7 U.S.C. 6d(b) paragraph (2) of this section subsection (a)(1)(B) (g) Section 4f(c) of the Commodity Exchange Act ( 7 U.S.C. 6f(c) (1) in paragraph (3)(A), by striking the first comma; and (2) in paragraph (4)— (A) in subparagraph (A), in the first sentence, by striking in developing In developing (B) in subparagraph (B), by striking 1817(a) 1817(a)) (h) Section 4p(b) of the Commodity Exchange Act ( 7 U.S.C. 6p(b) state law State law (i) Section 5f(b)(1) of the Commodity Exchange Act ( 7 U.S.C. 7b–1(b)(1) section 5f this section (j) Section 6(a) of the Commodity Exchange Act ( 7 U.S.C. 8(a) the the the (k) Section 8a of the Commodity Exchange Act ( 7 U.S.C. 12a Investors Investor (l) Section 12(b) of the Commodity Exchange Act ( 7 U.S.C. 16(b) (m) Section 14(a) of the Commodity Exchange Act ( 7 U.S.C. 18(a) (1) by indenting paragraph (2) appropriately; and (2) in paragraph (2), by indenting subparagraph (B) appropriately. (n) Section 17(b) of the Commodity Exchange Act ( 7 U.S.C. 21(b) (1) in paragraph (9)(D), by striking the semicolon at the end and inserting a period; (2) in paragraph (10)(C)(ii), by striking and (3) in paragraph (11), by striking the period at the end and inserting a semicolon; (4) in paragraph (12)— (A) by striking (A) (B) by striking the period at the end and inserting ; and (5) in paragraph (13), in the matter preceding subparagraph (A), by striking A major a major (o) Section 17 of the Commodity Exchange Act ( 7 U.S.C. 21 (1) by redesignating subsection (r) as subsection (s); and (2) by redesignating the second subsection (q) (relating to comprehensive rule implementation programs) as subsection (r). (p) Section 22 of the Commodity Exchange Act ( 7 U.S.C. 25 (1) in subsection (a)(1)(C), by indenting clause (iv) appropriately; and (2) in subsection (b)— (A) in paragraph (3), by striking of registered of a registered (B) in paragraph (4), by inserting a comma after entity 417. Elimination of report due in 1986 Section 26 of the Futures Trading Act of 1978 ( 7 U.S.C. 16a (1) by striking subsection (b); and (2) by redesignating subsection (c) as subsection (b). May 10, 2016 Read twice and placed on the calendar

Summary: Commodity End-User Relief Act This bill amends the Commodity Exchange Act to reauthorize it and the Commodity Futures Trading Commission (CFTC) through FY2019, and revise requirements and prohibitions regarding: registered futures associations; futures commission merchants; commodity brokers in bankruptcy; futures trading transactions; judicial review of CFTC rules; the public interest exemption from futures trading and foreign transactions regulations of certain agreements, contracts, or transactions entered into pursuant to an approved or permitted tariff or rate schedule; swap dealers; unregistered designated contract markets or a swap execution facilities; bona fide hedging transactions or positions; and commodity pool operators that are qualified charitable organizations.