The Commodity Futures Trading Commission has published final regulations implementing the provisions of the CFTC Reauthorization Act of 2008 (the 2008 Act) relating to “significant price discovery contracts” (SPDCs) traded on exempt commercial markets (ECMs). The new regulations extend the large trader reporting rules currently applicable to designated contract markets to apply to SPDCs traded on ECMs. The regulations also amend the provisions of CFTC Regulation 36.3 to further specify the information that ECMs must provide to the CFTC on an initial and ongoing basis regarding the ECM’s operations and those agreements, contracts or transactions traded on the ECM that have not been deemed SPDCs.
The amendments also provide additional guidance regarding the criteria the CFTC will consider in determining whether a particular instrument is an SPDC and the self-regulatory responsibilities of ECMs with respect to SPDCs. Consistent with the 2008 Act, the new regulations require an ECM that lists an SPDC for trading to implement a trade monitoring program, develop an audit trail to monitor for market abuses, adopt position limits or position accountability levels, and publish certain daily trading information.
The amended regulations will become effective on April 22.