A bill to amend the Commodity Exchange Act to provide for the oversight of large trades of over-the-counter energy and agricultural contracts to prevent price manipulation and excessive speculation, and for other purposes.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Over-the-Counter Speculation Act''.

SEC. 2. LARGE OVER-THE-COUNTER TRANSACTIONS.

    Section 2 of the Commodity Exchange Act (7 U.S.C. 2) is amended by 
adding at the end the following:
    ``(j) Commission Oversight of Over-the-Counter Transactions.--
            ``(1) Over-the-counter transactions.--
                    ``(A) Definition.--The term `over-the-counter 
                transaction' means a contract, agreement, or 
                transaction in an exempt or agricultural commodity that 
                is--
                            ``(i) entered into only between persons 
                        that are eligible contract participants at the 
                        time the persons enter into the agreement, 
                        contract, or transaction;
                            ``(ii) not entered into on a trading 
                        facility; and
                            ``(iii) not a sale of any cash commodity 
                        for deferred shipment or delivery.
                    ``(B) All otc transactions included.--
                Notwithstanding subsections (g) and (h) and any 
                exemption issued by the Commission under section 4(c), 
                each over-the-counter transaction shall be subject to 
                this subsection.
            ``(2) Commission oversight authority.--
                    ``(A) In general.--In the case of a major market 
                disturbance, as determined by the Commission, the 
                Commission may require any trader required to report 
                information under paragraph (3) to take such action as 
                the Commission considers to be necessary to maintain or 
                restore orderly trading in any contract listed for 
                trading on a registered entity, including--
                            ``(i) the liquidation of any over-the-
                        counter transaction; and
                            ``(ii) the fixing of any limit that may 
                        apply to a market position involving any over-
                        the-country transaction acquired in good faith 
                        before the date of the determination of the 
                        Commission.
                    ``(B) Major market disturbance.--The term `major 
                market disturbance' means any market disturbance in a 
                commodity market that prevents the commodity market 
                from accurately reflecting the forces of supply and 
                demand for a commodity, including--
                            ``(i) a threatened or actual market 
                        manipulation or corner;
                            ``(ii) excessive speculation; and
                            ``(iii) any action of the United States or 
                        a foreign government that affects a commodity.
                    ``(C) Market disturbance.--The term `market 
                disturbance' shall be interpreted in a manner 
                consistent with section 8a(9).
                    ``(D) Judicial review.--Any action taken by the 
                Commission under subparagraph (A) shall be subject to 
                judicial review carried out in accordance with section 
                8a(9).
            ``(3) Reporting; recordkeeping.--
                    ``(A) In general.--The Commission shall require 
                each covered person to submit to the Commission a 
                report at such times and in such manner as the 
                Commission determines appropriate, and containing the 
                information required under subparagraph (C) to assist 
                the Commission in detecting and preventing potential 
                price manipulation of, or excessive speculation in, any 
                contract listed for trading on a registered entity.
                    ``(B) Covered person.--In this subsection, the term 
                `covered person' means a person that enters into an 
                over-the-counter transaction the reporting of which is 
                required as the result of a determination made under 
                paragraph (D).
                    ``(C) Contents of report.--A report required under 
                subparagraph (A) shall contain--
                            ``(i) information describing large trading 
                        positions of the covered person obtained 
                        through 1 or more over-the-counter transactions 
                        that involve--
                                    ``(I) substantial quantities of a 
                                commodity in the cash market; or
                                    ``(II) substantial positions, 
                                investments, or trades in agreements or 
                                contracts relating to the commodity; 
                                and
                            ``(ii) any other information relating to 
                        each covered over-the-counter transaction 
                        carried out by the covered person that the 
                        Commission determines to be necessary to 
                        accomplish the purposes described in 
                        subparagraph (A).
                    ``(D) Large transactions.--The Commission shall 
                identify the large over-the-counter transactions or 
                class of large over-the-counter transactions the 
                reporting of which the Commission determines to be 
                appropriate to assist the Commission in detecting and 
                preventing potential price manipulation of, or 
                excessive speculation in, any contract listed for 
                trading on a registered entity. In making the 
                determinations as to which over-the-counter 
                transactions shall be reported, the Commission shall 
                consider the extent to which one or more of the 
                following criteria applies--
                            ``(i) a standardized agreement is used to 
                        execute the transaction;
                            ``(ii) the transaction settles against any 
                        price (including the daily or final settlement 
                        price) of 1 or more contracts listed for 
                        trading on a registered entity;
                            ``(iii) the price of the transaction is 
                        reported to a third party, published, or 
                        otherwise disseminated;
                            ``(iv) the price of the transaction is 
                        referenced in any other transaction;
                            ``(v) there is a significant volume of 
                        transactions; and
                            ``(vi) any other factor that the Commission 
                        determines to be appropriate.
                    ``(E) Recordkeeping.--The Commission, by rule, 
                shall require each covered person--
                            ``(i) in accordance with section 4i, to 
                        maintain such records as directed by the 
                        Commission for a period of 5 years, or longer, 
                        if directed by the Commission; and
                            ``(ii) to provide such records upon request 
                        to the Commission or the Department of Justice.
            ``(4) Protection of proprietary information.--In carrying 
        out this subsection, the Commission may not--
                    ``(A) require the real-time publication of any 
                proprietary information;
                    ``(B) prohibit the commercial sale or licensing of 
                any real-time proprietary information; and
                    ``(C) except as provided in section 8, publicly 
                disclose any information relating to any market 
                position, business transaction, trade secret, or name 
                of any customer of a covered person.
            ``(5) Rulemaking.--
                    ``(A) Proposed rulemaking.--Not later than 180 days 
                after the date of enactment of this subsection, the 
                Commission shall issue a notice of proposed rulemaking 
                to specify the information required to be provided and 
                maintained by a covered person under this subsection.
                    ``(B) Final rule.--Not later than 1 year after the 
                date of enactment of this subsection, the Commission 
                shall promulgate a final rule to accomplish the purpose 
                described in subparagraph (A).''.

Summary: Over-the-Counter Speculation Act - Amends the Commodity Exchange Act to authorize the Commodity Futures Trading Commission (CFTC), in the case of a major market disturbance, to require any trader required to report under this Act to take action to maintain or restore orderly trading in any contract listed for trading on a registered entity, including: (1) liquidation of any over-the-counter transaction; and (2) fixing of any limit that may apply to a market position involving any over-the-counter transaction acquired in good faith before the date of the CFTC's determination of a major market disturbance.

Defines "major market disturbance" and "over-the-counter transaction."

Sets forth reporting and recordkeeping requirements.