CBOT, CME and NYMEX Respond to CFTC Proposal For Change in Futures Contract Approval Process

The three largest U.S. futures exchanges, The Chicago Board of Trade (CBOT), Chicago Mercantile Exchange (CME) and New York Mercantile Exchange (NYMEX) today issued the following statement in response to the Commodity Futures Trading Commission's (CFTC) proposed change to the regulatory approval process for new futures contracts: "By accepting that exchanges should have the ability to list contracts for trading without the delay of a lengthy regulatory approval process, the CFTC has taken a key first step to respond to the U.S. exchanges' appeal for regulatory relief," officials of the three exchanges said. "We commend the CFTC for beginning the critical process of working to provide real relief for U.S. exchanges that are competing in a fierce global marketplace. The next step should be approval of the exchange petition seeking the broader relief that is required to give us parity with less-regulated competitors." The CFTC's proposed change in the approval process, announced July 21, would require exchanges to file the contract's terms and conditions with the CFTC by the close of business on the day prior to first listing the new contract. Contract expiration months could extend up to one year in the future. The exchange would then have 45 days in which to file with the CFTC an application for trading the contract. The U.S. exchanges petitioned the CFTC on June 28 for regulatory relief in order to compete on equal terms with foreign boards of trade which, if the Commission approves the no action petitions currently pending, would be able to offer competing products via direct electronic access to persons in the U.S. The exchanges noted the contribution of the CFTC's Global Markets Advisory Committee in conjunction with the proposal and indicated they may also provide specific comments within the designated comment period.