CFTC gives exchanges 30 days to address geographic restrictions
Exchanges must remove restrictions that breach impartial access rules or explain to the regulator why compliance is not feasible.
Key takeaways:
- The CFTC has asked designated contract markets (DCMs) to review and address domestic geographic restrictions that limit access to their platforms.
- Exchanges have 30 days to remove restrictions that violate the rules or submit an explanation to the regulator on why compliance is not feasible.
- The measure cites Commission Regulation 38.151(b), which requires DCMs to provide impartial access to their members and other persons with trading privileges.
- CFTC Chairman Michael S. Selig said geographic access restrictions are inconsistent with the purposes of the Commodity Exchange Act and its impartial access requirements.
US.- The US Commodity Futures Trading Commission (CFTC) has asked designated contract markets (DCMs) to review and address any domestic geographic restrictions that limit access to their platforms. Exchanges have 30 days to remove restrictions that violate the rules or submit an explanation to the regulator outlining why compliance is not feasible.
The measure cites Commission Regulation 38.151(b), which requires DCMs to provide impartial access to their members and other persons with trading privileges. The CFTC said the measure is intended to ensure that derivatives markets operate under consistent conditions across the country.
“Derivatives markets must operate on a uniform basis at a national scale to achieve the purposes set out in the Commodity Exchange Act,” said CFTC Chairman Michael S. Selig. “Geographic access restrictions are inconsistent with those purposes and the Act’s impartial access requirements.”
The instructions also apply to intermediaries that provide access to DCMs. Exchanges must ensure that these companies do not restrict access and comply with impartial access requirements within the 30-day deadline. If a DCM cannot meet either requirement within that period, it must explain the reasons to the Division of Market Oversight (DMO).
The Commission said it will assess the facts and circumstances of individual cases when considering potential regulatory action.
Frequently asked questions (FAQs)
- What has the CFTC asked designated contract markets to do? The CFTC has asked DCMs to review and address domestic geographic restrictions that limit access to their platforms. Within 30 days, they must remove restrictions that violate the rules or submit an explanation to the regulator outlining why compliance is not feasible.
- What happens if a DCM cannot comply within 30 days? It must explain the reasons to the CFTC’s Division of Market Oversight (DMO). The Commission said it will assess the facts and circumstances of individual cases when considering potential regulatory action.
