[Federal Register Volume 59, Number 201 (Wednesday, October 19, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-25850]


[[Page Unknown]]

[Federal Register: October 19, 1994]


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COMMODITY FUTURES TRADING COMMISSION

 

Chicago Mercantile Exchange Proposed Transfer of Spot for Futures 
Rule Amendments

AGENCY: Commodity Futures Trading Commission.

ACTION: Notice of proposed rule amendments of the Chicago Mercantile 
Exchange to restrict the transfer of spot commodities for futures 
contracts for the Eurodollar futures contract.

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SUMMARY: The Chicago Mercantile Exchange (``CME'') has submitted 
proposed rule amendments and other materials which would limit the 
permissibility of the transfer of spot commodities for futures 
contracts, also known as exchange for physical transactions, for the 
Eurodollar futures contract.1 Acting pursuant to the authority 
delegated by Commission Regulation 140.96, the Division of Trading and 
Markets has determined to publish the CME proposal for public comment. 
The Division believes that publication of the CME proposal is in the 
public interest and will assist the Commission in considering the views 
of interested persons.

    \1\The CME proposal includes proposed amendments to existing 
Rules 538 and 3904.
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DATES: Comments must be received on or before November 18, 1994.

FOR FURTHER INFORMATION CONTACT: John C. Lawton, Associate Director, or 
Clarence Sanders, Attorney, Division of Trading and Markets, Commodity 
Futures Trading Commission, 2033 K Street NW, Washington, DC 20581. 
Telephone: (202) 254-8955.

SUPPLEMENTARY INFORMATION:

I. Description of Proposed Rules and Rule Amendments

    By a letter dated September 12, 1994, the CME submitted proposed 
rule amendments pursuant to Section 5a(a)(12)(A) of the Commodity 
Exchange Act (``Act'') and Commission Regulation 1.41(b). The proposed 
amendments would limit the permissibility of exchange for physical 
(``EFP'') transactions for the Eurodollar futures contract.
    Under the proposal, EFP transactions would no longer be permitted 
for any contract month beyond the second listed quarterly month in the 
March quarterly cycle.2 Such EFP transactions would continue to be 
permitted for those months not extending beyond the second listed 
quarterly month in the March quarterly cycle.
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    \2\For the Eurodollar futures contract the CME currently lists 
contract months extending ten years.
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    Pursuant to the proposal's implementation plan, the amendments 
would be made effective for all applicable contract months. Thus, under 
the proposal, the rule amendments would be implemented to apply to 
existing as well as newly listed contract months.
    According to the CME, the proposal is intended to support liquidity 
and price-discovery in deferred months of the Eurodollar futures 
contract. In this respect, it appears that the proposal at least 
partially represents a response to efforts to develop a new method for 
trading U.S. Treasury securities versus Eurodollar futures contracts 
(i.e., ``TED spreads''). This approach involves acquiring both legs of 
the spread position in a single transaction.

II. Request for Comments

    The Commission requests comments on any aspect of the CME's 
proposed rule amendments that members of the public believe may raise 
issues under the Act or Commission regulations.
    Copies of the proposed rule amendments and related materials are 
available for inspection at the Office of the Secretariat, Commodity 
Futures Trading Commission, 2033 K Street NW., Washington, DC 20581. 
Copies also may be obtained through the Office of the Secretariat at 
the above address or by telephoning (202) 254-6314. Some materials may 
be subject to confidential treatment pursuant to 17 CFR 145.5 or 145.9.
    Any person interested in submitting written data, views, or 
arguments on the proposed rule amendments should send such comments to 
Jean A. Webb, Secretary, Commodity Futures Trading Commission, 2033 K 
Street NW., Washington, DC 20581, by the specified date.

    Issued in Washington, DC, on October 13, 1994.
Alan L. Seifert,
Deputy Director.
[FR Doc. 94-25850 Filed 10-18-94; 8:45 am]
BILLING CODE 6351-01-P