I 
112TH CONGRESS 
1ST SESSION H. R. 3006 
To amend the Commodity Exchange Act to prevent excessive speculation 
in commodity markets and excessive speculative position limits on energy 
contracts, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
SEPTEMBER 21, 2011 
Mr. WELCH (for himself and Ms. DELAURO) introduced the following bill; 
which was referred to the Committee on Agriculture 
A BILL 
To amend the Commodity Exchange Act to prevent excessive 
speculation in commodity markets and excessive specula-
tive position limits on energy contracts, and for other 
purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Anti-Excessive Specu-
lation Act of 2011’’. 
SEC. 2. FINDINGS. 
Congress finds that— 
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(1) as scores of recent academic and govern-
mental studies, reports, and analyses have shown, 
unlimited and excessive speculation in commodity 
markets causes harm to consumers and commodity- 
dependent businesses of the United States by con-
tributing to unnecessary volatility and unwarranted 
increases in food and energy prices; 
(2) for the purpose of diminishing, eliminating, 
or preventing the burdens imposed on interstate 
commerce by excessive speculation in commodities, 
section 4a(a)(1) of the Commodity Exchange Act (7 
U.S.C. 6a(a)(1)) directs the Commodity Futures 
Trading Commission to proclaim and fix speculative 
position limits, as necessary, on the amount of com-
modity trading by any person, including any group 
or class of traders other than bona fide hedgers; 
(3) pursuant to the standards set forth in sec-
tion 4a(a)(1) of the Commodity Exchange Act (7 
U.S.C. 6a(a)(1)), section 4a(a)(2) of that Act directs 
the Commodity Futures Trading Commission to es-
tablish limits on the positions that may be held by 
commodity traders, other than bona fide hedge posi-
tions, and establishes a specific timetable for imple-
mentation of those limits; 
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(4) the rulemaking authority of section 4a of 
the Commodity Exchange Act (7 U.S.C. 6a) pro-
vides the Commodity Futures Trading Commission 
with ample authority to impose meaningful specula-
tive position limits on commodity trading by indi-
vidual speculators, as well as position limits on the 
overall level of speculative trading in the market-
place; 
(5) in recent years, the interpretation of the 
Commodity Futures Trading Commission of the 
term ‘‘excessive speculation’’ has focused on the 
threat that singular, concentrated positions pose to 
the liquidity and efficient management of commodity 
trading; 
(6) the historically narrow emphasis of the 
Commodity Futures Trading Commission on the 
burden created by concentrated speculative positions 
has deterred the Commission from adopting addi-
tional measures to ensure that the aggregate level of 
speculation in the market does not contribute to un-
warranted increases in commodity price levels; 
(7) this Act clarifies that— 
(A) one of the fundamental objectives of 
the Commodity Exchange Act (7 U.S.C. 1 et 
seq.) is to ensure that the commodity markets 
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accurately reflect the fundamental supply and 
demand for commodities; and 
(B) the deterrence and prevention of exces-
sive speculation is an express purpose of that 
Act; 
(8) in order to end decades of legal uncertainty 
and regulatory ambiguity that has undermined en-
forcement efforts, this Act defines the term ‘‘exces-
sive speculation’’ and creates legal presumptions 
that give rise to a determination that excessive spec-
ulation is present in a commodity market; and 
(9) the individual and aggregate position limits 
set forth in this Act and applicable to energy con-
tracts seek to strengthen, and not replace, any limits 
established by the Commodity Futures Trading 
Commission under the rulemaking processes of the 
Commission. 
SEC. 3. FINDINGS AND PURPOSE. 
Section 3 of the Commodity Exchange Act (7 U.S.C. 
5) is amended— 
(1) in subsection (a), by striking ‘‘, or’’ and in-
serting ‘‘that accurately reflect the fundamental sup-
ply and demand for commodities, and’’; and 
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(2) in subsection (b), in the second sentence, by 
inserting ‘‘and excessive speculation’’ after ‘‘prevent 
price manipulation’’. 
SEC. 4. FOREIGN BOARDS OF TRADE. 
Section 4(b)(1)(A)(i) of the Commodity Exchange 
Act (7 U.S.C. 6(b)(1)(A)(i)) is amended by striking ‘‘sub-
ject to comparable, comprehensive’’ and inserting the fol-
lowing: ‘‘subject to— 
‘‘(I) rules and restrictions prohib-
iting excessive speculation by govern-
mental authorities that are com-
parable to the law, regulations, and 
orders applicable to boards of trade in 
the United States; and 
‘‘(II) 
comparable, 
comprehen-
sive’’. 
SEC. 5. EXCESSIVE SPECULATION. 
Section 4a of the Commodity Exchange Act (7 U.S.C. 
6a) is amended— 
(1) in subsection (a)— 
(A) in paragraph (1)— 
(i) in the first sentence, by striking 
‘‘Excessive speculation’’ and inserting the 
following: 
‘‘(A) EXCESSIVE SPECULATION.— 
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‘‘(i) IN GENERAL.—Excessive specula-
tion’’; 
(ii) by inserting after the first sen-
tence the following: 
‘‘(ii) FACTORS.—Excessive speculation 
in a commodity market exists if speculative 
traders have a substantial impact on price 
discovery. 
‘‘(iii) PRESUMPTION
OF
EXCESSIVE 
SPECULATION.—For purposes of this Act, 
speculative traders shall be presumed to 
have a substantial impact on price dis-
covery if the Commission determines 
that— 
‘‘(I) gross positions, long or 
short, attributable to speculative trad-
ing in a contract for future delivery, 
an option on such a contract, a swaps 
contract listed for trading on a des-
ignated contract market, or a swaps 
contract listed for trading on a swaps 
execution facility exceed the gross po-
sitions, long or short, attributable to 
bona fide hedging transactions traded 
in such a contract or option; or 
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‘‘(II) the average percentage of 
open interest, long or short, held by 
persons primarily engaged in specula-
tive trading during the most recent 
12-month period for which data are 
available exceeds by more than 10 
percent the average annual percentage 
of open interest, long or short, held by 
persons primarily engaged in specula-
tive trading during— 
‘‘(aa) the preceding 25-year 
period; or 
‘‘(bb) if the interest is held 
by the persons for less than the 
25-year period, the period during 
which the contract has been trad-
ed on a designated contract mar-
ket.’’; 
(iii) in the second sentence, by strik-
ing ‘‘For the purpose of diminishing, elimi-
nating, or preventing such burden’’ and in-
serting the following: 
‘‘(B) POSITION LIMITS.— 
‘‘(i) IN GENERAL.—For the purpose 
of diminishing, eliminating, or preventing 
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the burden on interstate commerce de-
scribed in subparagraph (A)(i)’’; and 
(iv) by designating the third, fourth, 
fifth, and sixth sentences (as those sen-
tences existed before the amendments 
made by clauses (i) through (iii)) as 
clauses (ii), (iii), (iv), and (v), respectively, 
of subparagraph (B) (as added by clause 
(iii)); 
(B) by redesignating paragraph (7) as 
paragraph (8); 
(C) by inserting after paragraph (6) the 
following: 
‘‘(7) SPECULATIVE
POSITION
LIMITS
ON
EN-
ERGY CONTRACTS.— 
‘‘(A) DEFINITIONS.—In this paragraph: 
‘‘(i) ENERGY
CONTRACT.—The term 
‘energy contract’ means— 
‘‘(I) a contract referencing the 
price of crude oil, gasoline, diesel fuel, 
jet fuel, heating oil, or natural gas 
and traded on a registered entity; 
‘‘(II) with respect to an agree-
ment, contract, or transaction that 
settles against any price (including 
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the daily or final settlement price) of 
one or more contracts referencing the 
price of crude oil, gasoline, diesel fuel, 
jet fuel, heating oil, or natural gas 
and listed for trading on a registered 
entity, a contract traded on a foreign 
board of trade that provides members 
or other participants located in the 
United States with direct access to 
the electronic trading and order 
matching system of the foreign board 
of trade; and 
‘‘(III) swap contracts referencing 
the price of crude oil, gasoline, diesel 
fuel, jet fuel, heating oil, or natural 
gas that perform or affect a signifi-
cant price discovery function with re-
spect to regulated entities. 
‘‘(ii) EXCESSIVE SPECULATIVE POSI-
TION.—The term ‘excessive speculative po-
sition’ means a position that affects— 
‘‘(I) in the spot month, more 
than 5 percent of the estimated deliv-
erable supply of the same commodity; 
and 
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‘‘(II) in a single month or all 
months combined, more than 5 per-
cent of the open interest in a contract. 
‘‘(B) INDIVIDUAL POSITION LIMITS ON EN-
ERGY
CONTRACTS.—No person may hold or 
control an excessive speculative position, long or 
short, in an energy contract in any single mar-
ket described in subclause (I), (II), or (III) of 
subparagraph (A)(i) and aggregated across all 
markets described in those subclauses in the 
spot month, a single month, or all-months com-
bined. 
‘‘(C) AGGREGATE SPECULATIVE POSITION 
LIMITS ON ENERGY CONTRACTS.— 
‘‘(i) IN GENERAL.—Not later than 45 
days after the date of enactment of the 
Anti-Excessive Speculation Act of 2011, 
the Commission shall issue an order that 
establishes aggregate speculative position 
limits for long energy contracts held by 
speculators as a class of traders in any sin-
gle market described in subclause (I), (II), 
or (III) of subparagraph (A)(i) and in all 
markets described in those subclauses. 
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‘‘(ii) REQUIREMENTS.—The aggregate 
speculative position limits shall be estab-
lished at levels that are not greater than 
the average annual percentage of long open 
interest held by speculators in any single 
market described in subclause (I), (II), or 
(III) of subparagraph (A)(i) and in all 
markets described in those subclauses dur-
ing— 
‘‘(I) the preceding 25-year pe-
riod; or 
‘‘(II) if the interest is held by 
speculators for less than the 25-year 
period, the period during which the 
contract has been traded. 
‘‘(iii) PROCEDURES.—To the extent 
necessary, the order shall include transi-
tion rules to ensure an orderly and gradual 
reduction in aggregate speculative posi-
tions in a manner that does not mandate 
or require the unwinding of contracts and 
agreements existing on the date of enact-
ment of the Anti-Excessive Speculation Act 
of 2011. 
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‘‘(D) EXEMPTION FOR BONA FIDE ENERGY 
HEDGING TRANSACTIONS.— 
‘‘(i) DEFINITION OF BONA FIDE EN-
ERGY HEDGING.— 
‘‘(I) IN GENERAL.—In this sub-
paragraph, the term ‘bona fide energy 
hedging’ means a transaction or posi-
tion that is proportionate and eco-
nomically appropriate for the reduc-
tion of risks in the conduct and man-
agement of a trade or business that 
produces, 
processes, 
merchandises, 
manufactures, or consumes an energy 
commodity. 
‘‘(II) EXCLUSION.—For purposes 
of this paragraph, the management of 
financial risk associated with swaps or 
other similar contracts, by itself, shall 
not constitute bona fide energy hedg-
ing. 
‘‘(ii) EXCLUSION.—For purposes of 
this paragraph, bona fide energy hedging 
shall be excluded when computing the posi-
tions held or controlled by a person. 
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