The Commodity Futures Trading Commission’s Division of Market Oversight issued a press release formally reminding market participants of new reporting obligations for Forms 40/40S and Form 71 as of last Friday (Form 40s/40Ss are requested by special call by the CFTC to reporting traders while Form 71s are also requested by special call by the CFTC to all so-called omnibus volume threshold accounts; for details regarding CFTC requirements, click here to access the article “Where, Oh Where Is the CFTC New Form 40 Portal?” in the November 13, 2016 edition of Bridging the Week.)
Compliance Weeds: While end users’ attention is rightfully fixated on the new electronic Form 40 and 40S and their new questions, agricultural merchants and hedgers should not forget their obligations to file CFTC Form 204s and 304s as necessary. CFTC Form 204 (Statement of Cash Positions in Grains, Soybeans, Soybean Oil and Soybean Meal) and Parts I and II of Form 304 (Statement of Cash Position in Cotton – Fixed Price Cash Positions) must be filed by any person that holds or controls a position in excess of relevant federal speculative position limits that constitutes a bona fide hedging position under CFTC rules. These documents must be made as of the close of business on the last Friday of the relevant month. Form 204 must be received by the CFTC in Chicago by no later than the third business day following the date of the report, while Form 304 must be received by the Commission in New York by no later than the second business day following the date of the report. Part III of Form 304 (Unfixed Price Cotton “On-Call”) must be filed by any cotton merchant or dealer that holds a so-called reportable position in cotton (i.e., pursuant to large trader reportable levels; click here access CFTC Rule 15.03) regardless of whether or not it constitutes a bona fide hedge. Form 304 (Part III) must be made as of the close of business on Friday every week, and received by the CFTC in New York by no later than the second business day following the date of the report. Form 204s and 304s remain paper forms!