§ 7a–2. Common provisions applicable to registered entities
-
(a) Acceptable business practices under core principles (1) In general Consistent with the purposes of this chapter, the Commission may issue interpretations, or approve interpretations submitted to the Commission, of sections 7(d) and 7a–1(c)(2) of this title, to describe what would constitute an acceptable business practice under such sections.
(2) Effect of interpretation An interpretation issued under paragraph (1) may provide the exclusive means for complying with each section described in paragraph (1).
(b) Delegation of functions under core principles (1) In general A contract market, derivatives transaction execution facility, or electronic trading facility with respect to a significant price discovery contract may comply with any applicable core principle through delegation of any relevant function to a registered futures association or a registered entity that is not an electronic trading facility.
(2) Responsibility A contract market, derivatives transaction execution facility, or electronic trading facility that delegates a function under paragraph (1) shall remain responsible for carrying out the function.
(3) Noncompliance If a contract market, derivatives transaction execution facility, or electronic trading facility that delegates a function under paragraph (1) becomes aware that a delegated function is not being performed as required under this chapter, the contract market, derivatives transaction execution facility, or electronic trading facility shall promptly take steps to address the noncompliance.
(c) New contracts, new rules, and rule amendments (1) In general A registered entity may elect to list for trading or accept for clearing any new contract, or other instrument, or may elect to approve and implement any new rule or rule amendment, by providing to the Commission (and the Secretary of the Treasury, in the case of a contract of sale of a government security for future delivery (or option on such a contract) or a rule or rule amendment specifically related to such a contract) a written certification that the new contract or instrument or clearing of the new contract or instrument, new rule, or rule amendment complies with this chapter (including regulations under this chapter).
(2) Rule review The new rule or rule amendment described in paragraph (1) shall become effective, pursuant to the certification of the registered entity and notice of such certification to its members (in a manner to be determined by the Commission), on the date that is 10 business days after the date on which the Commission receives the certification (or such shorter period as determined by the Commission by rule or regulation) unless the Commission notifies the registered entity within such time that it is staying the certification because there exist novel or complex issues that require additional time to analyze, an inadequate explanation by the submitting registered entity, or a potential inconsistency with this chapter (including regulations under this chapter).
(3) Stay of certification for rules (A) A notification by the Commission pursuant to paragraph (2) shall stay the certification of the new rule or rule amendment for up to an additional 90 days from the date of the notification. (B) A rule or rule amendment subject to a stay pursuant to subparagraph (A) shall become effective, pursuant to the certification of the registered entity, at the expiration of the period described in subparagraph (A) unless the Commission— (i) withdraws the stay prior to that time; or (ii) notifies the registered entity during such period that it objects to the proposed certification on the grounds that it is inconsistent with this chapter (including regulations under this chapter). (C) The Commission shall provide a not less than 30-day public comment period, within the 90-day period in which the stay is in effect as described in subparagraph (A), whenever the Commission reviews a rule or rule amendment pursuant to a notification by the Commission under this paragraph. (4) Prior approval (A) In general A registered entity may request that the Commission grant prior approval to any new contract or other instrument, new rule, or rule amendment.
(B) Prior approval required Notwithstanding any other provision of this section, a designated contract market shall submit to the Commission for prior approval each rule amendment that materially changes the terms and conditions, as determined by the Commission, in any contract of sale for future delivery of a commodity specifically enumerated in section 1a(10) of this title), by a designated contract market or swap execution facility, the Commission may determine that such agreements, contracts, or transactions are contrary to the public interest if the agreements, contracts, or transactions involve—
(I) activity that is unlawful under any Federal or State law; (II) terrorism; (III) assassination; (IV) war; (V) gaming; or (VI) other similar activity determined by the Commission, by rule or regulation, to be contrary to the public interest. (ii) Prohibition No agreement, contract, or transaction determined by the Commission to be contrary to the public interest under clause (i) may be listed or made available for clearing or trading on or through a registered entity.
(iii) Swaps contracts (I) In general In connection with the listing of a swap for clearing by a derivatives clearing organization, the Commission shall determine, upon request or on its own motion, the initial eligibility, or the continuing qualification, of a derivatives clearing organization to clear such a swap under those criteria, conditions, or rules that the Commission, in its discretion, determines.
(II) Requirements Any such criteria, conditions, or rules shall consider— (aa) the financial integrity of the derivatives clearing organization; and (bb) any other factors which the Commission determines may be appropriate. (iv) Deadline The Commission shall take final action under clauses (i) and (ii) in not later than 90 days from the commencement of its review unless the party seeking to offer the contract or swap agrees to an extension of this time limitation.
(d) Repealed. Pub. L. 111–203, title VII, § 745(c), July 21, 2010 , 124 Stat. 1737(e) Reservation of emergency authority Nothing in this section shall limit or in any way affect the emergency powers of the Commission provided in section 12a(9) of this title.
(f) Rules to avoid duplicative regulation of dual registrants Consistent with this chapter, each designated contract market and registered derivatives transaction execution facility shall issue such rules as are necessary to avoid duplicative or conflicting rules applicable to any futures commission merchant registered with the Commission pursuant to section 6f(a) of this title (except paragraph (2) thereof), that is also registered with the Securities and Exchange Commission pursuant to section 78o(b) of title 15 (except paragraph (11) thereof) with respect to the application of— (1) rules of such designated contract market or registered derivatives transaction execution facility of the type specified in section 6d(e) of this title involving security futures products; and (2) similar rules of national securities associations registered pursuant to section 78o–3(a) of title 15 and national securities exchanges registered pursuant to section 78f(g) of title 15 involving security futures products.
References In Text
This chapter, referred to in subsec. (c)(5)(A), was in the original “this subtitle”, and was translated as reading “this Act” to reflect the probable intent of Congress.
Codification
Pub. L. 110–234 and Pub. L. 110–246 made identical amendments to this section. The amendments by Pub. L. 110–234 were repealed by section 4(a) of Pub. L. 110–246.
Amendments
2010—Subsec. (a)(1). Pub. L. 111–203, § 749(c)(1), struck out “, 7a(d),” after “7(d)” and “and section 2(h)(7) of this title with respect to significant price discovery contracts,” before “to describe”.
Subsec. (a)(2). Pub. L. 111–203, § 745(a), added par. (2) and struck out former par. (2). Prior to amendment, text read as follows: “An interpretation issued under paragraph (1) shall not provide the exclusive means for complying with such sections.”
Subsec. (c). Pub. L. 111–203, § 745(b), added subsec. (c) and struck out former subsec. (c) which related to new contracts, new rules, and rule amendments and Commission approval upon certification of compliance with this chapter.
Subsec. (c)(1). Pub. L. 111–203, § 717(d), designated existing provisions as subpar. (A), inserted heading, and added subpar. (B).
Subsec. (c)(2)(B). Pub. L. 111–203, § 721(e)(7), substituted “section 1a(9)” for “section 1a(4)”.
Subsec. (d). Pub. L. 111–203, § 745(c), struck out subsec. (d) which related to violation of core principles.
Subsec. (f)(1). Pub. L. 111–203, § 749(c)(2), substituted “section 6d(e) of this title” for “section 6d(c) of this title”.
2008—Subsec. (a)(1). Pub. L. 110–246, § 13203(i), which directed amendment of par. (1) by inserting “, and section 2(h)(7) of this title with respect to significant price discovery contracts,” after “, and 7a–1(d)(2) of this title”, was executed by making the insertion after “, and 7a–1(c)(2) of this title” to reflect the probable intent of Congress and the intervening amendment by Pub. L. 110–246, § 13105(e). See below.
Pub. L. 110–246, § 13105(e), substituted “7a–1(c)(2)” for “7a–1(d)(2)”.
Subsec. (b)(1). Pub. L. 110–246, § 13203(j)(1), added par. (1) and struck out heading and text of former par. (1). Text read as follows: “A contract market or derivatives transaction execution facility may comply with any applicable core principle through delegation of any relevant function to a registered futures association or another registered entity.”
Subsec. (b)(2), (3). Pub. L. 110–246, § 13203(j)(2), (3), substituted “contract market, derivatives transaction execution facility, or electronic trading facility” for “contract market or derivatives transaction execution facility” wherever appearing.
Subsec. (d)(1). Pub. L. 110–246, § 13203(k), which directed amendment of par. (1) by inserting “or 2(h)(7)(C) of this title with respect to a significant price discovery contract traded or executed on an electronic trading facility,” after “7a–1(d)(2)”, was executed by making the insertion after “7a–1(c)(2)” in introductory provisions to reflect the probable intent of Congress and the intervening amendment by Pub. L. 110–246, § 13105(e). See below.
Pub. L. 110–246, § 13105(e), substituted “7a–1(c)(2)” for “7a–1(d)(2)” in introductory provisions.
Subsec. (f)(1). Pub. L. 110–246, § 13105(f), substituted “6d(c)” for “6d(3)”.
2000—Subsec. (f). Pub. L. 106–554, § 1(a)(5) [title II, § 251(h)], added subsec. (f).
Effective Date Of Amendment
Amendment by Pub. L. 111–203 effective on the later of 360 days after
Amendment of this section and repeal of Pub. L. 110–234 by Pub. L. 110–246 effective
Amendment by section 13203(i)–(k) of Pub. L. 110–246 effective