[Federal Register Volume 60, Number 75 (Wednesday, April 19, 1995)]
[Rules and Regulations]
[Pages 19493-19494]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-9636]



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COMMODITY FUTURES TRADING COMMISSION

17 CFR Part 30


Foreign Option Transactions

AGENCY: Commodity Futures Trading Commission.

ACTION: Order.

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SUMMARY: The Commodity Futures Trading Commission (Commission) is 
authorizing option contracts on the Three-month Eurolira Interest Rate 
futures contract traded on the London International Financial Futures 
and Options Exchange (LIFFE) to be offered or sold to persons located 
in the United States. This Order is issued pursuant to: (1) Commission 
rule 30.3(a), 17 CFR 30.3(a), which makes it unlawful for any person to 
engage in the offer or sale of a foreign option product until the 
Commission, by order, authorizes such foreign option to be offered or 
sold in the United States; and (2) the Commission's Order issued on 
September 5, 1989, 54 FR 37636 (September 12, 1989) authorizing certain 
option products traded on LIFFE to be offered or sold in the United 
States.

EFFECTIVE DATE: May 19, 1995.

FOR FURTHER INFORMATION CONTACT: Warren Gorlick, Esq., Division of 
Trading and Markets, Commodity Futures Trading Commission, 2033 K 
Street NW., Washington, D.C. 20581. Telephone: (202) 254-8955.

SUPPLEMENTARY INFORMATION: The Commission has issued the following 
Order:

    Order Under Commission Rule 30.3(a) Permitting Option Contracts 
on the Three-Month Eurolira Interest Rate Futures Contract Traded on 
the London International Financial Futures and Options Exchange to 
be Offered or Sold in the United States Thirty Days after 
Publication of this Notice in the Federal Register Absent Further 
Notice.

    By Order issued on September 5, 1989 (Initial Order), the 
Commission authorized, pursuant to Commission rule 30.3(a),\1\ certain 
option products traded on the London International Financial Futures 
and Option Exchange (LIFFE) to be offered or sold in the United States. 
54 FR 37636 (September 12, 1989). Among other conditions, the Initial 
Order specified that:

    \1\Commission rule 30.3(a), 17 CFR 30.3(a), makes it unlawful 
for any person to engage in the offer or sale of a foreign option 
product until the Commission, by order, authorizes such foreign 
option to be offered or sold in the United States.

    Except as otherwise permitted under the Commodity Exchange Act 
and regulations thereunder, * * * no offer or sale of any LIFFE 
option product in the United States shall be made until thirty days 
after publication in the Federal Register of notice specifying the 
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particular option(s) to be offered or sold pursuant to this Order.

    By letter dated March 14, 1995, LIFFE represented that it would be 
introducing an option contract based on the Three-Month Eurolira 
Interest Rate futures contract on May 16, 1995.\2\ LIFFE has requested 
that the Commission supplement its Initial Order authorizing the offer 
and sale in the United States of options on the Long Gilt, U.S. 
Treasury Bond, German Government Bond, Three-Month Sterling Interest 
Rate, Three-Month Eurodollar Interest Rate futures contracts, options 
on Sterling and Dollar-Mark currencies; a Supplemental Order, 55 FR 
7705 (March 5, 1990), authorizing the offer and sale in the United 
States of options on the Three-Month Euro-Deutschemark Interest Rate 
futures contract; a Supplemental Order, 57 FR 1374 (January 14, 1992), 
authorizing the offer and sale in the United States of options on the 
Italian Government Bond futures contract; and a Supplemental Order, 57 
FR 40603 (September 4, 1992) authorizing the offer and sale in the 
United States of options on the Three-Month Euro Swiss Franc Interest 
Rate futures contract; by also authorizing LIFFE's option contract on 
the Three-Month Eurolira Interest Rate futures contract to be offered 
or sold to persons in the United States. Upon due consideration, and 
for the reasons previously discussed in the Initial Order, the 
Commission believes that such an authorization should be granted.

    \2\Letter from N.E. Carew, LIFFE, to Jane C. Kang, Commission.
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    Accordingly, pursuant to Commission rule 30.3(a) and the 
Commission's Initial Order issued on September 5, 1989, and subject to 
the terms and conditions specified therein, the Commission hereby 
authorizes LIFFE's option contract on the Three-Month Eurolira Interest 
Rate futures contract to be offered or sold to persons located in the 
United States thirty days after publication of this Order in the 
Federal Register, unless prior to that date the Commission receives any 
comments which may result in a determination to delay the effective 
date of the Order pending review of such comments. Under such 
circumstances the Commission will provide notice.

Contract Specifications--Options on Three-Month Eurolira (``EUROLIRA'') 
Interest Rate Futures Contract

Underlying Interest
    One (1) Eurolira futures contract.
Delivery/Expiry Months
    March, June, September, December.
Deliver Day/Exercise Day/Expiry Day
    Exercise by 17.00 on any business day. Delivery on the first 
business day after the exercise day. Expiry at 12.30 on the Last 
Trading Day.
Last Trading Day
    11.00 Last Trading Day of the Eurolira futures contract.
Quotation
    Multiples of 0.01 (i.e. 0.01%).
Minimum Price Fluctuation (Tick Size and Value)
    0.01 (ITL 25,000)
Trading Hours
    07.57-16.10
Contract Standard
    Assignment of 1 Eurolira futures contract for the delivery month at 
the exercise price.
Exercise Price Intervals
    0.25 (i.e., 0.25%) e.g., 91.00, 91.25, 91.50 etc.
Introduction of New Exercise Prices
    Thirteen exercise prices will be listed for new series. Additional 
exercise prices will be introduced on the business day after the 
Eurolira [[Page 19494]] futures contract settlement price comes within 
0.12 of the fourth highest or lowest existing exercise price.

Option Price

    The contract price is payable by the buyer to the seller on 
exercise or expiry of the option, not at the time of the purchase. 
Positions are marked to market daily, as with futures positions.

List of Subjects in 17 CFR Part 30

    Commodity futures, Commodity options, Foreign transactions.

    Accordingly, 17 CFR Part 30 is amended as set forth below:

PART 30--FOREIGN FUTURES AND FOREIGN OPTION TRANSACTIONS

    1. The authority citation for Part 30 continues to read as follows:

    Authority: Secs. 2(a)(1)(A), 4, 4c, and 8a of the Commodity 
Exchange Act, 7 U.S.C. 2, 6, 6c and 12a.

    2. Appendix B to Part 30 is amended by adding the following entry 
after the existing entries for the ``London International Financial 
Futures and Options Exchange'' to read as follows:

Appendix B--Option Contracts Permitted To Be Offered or Sold in the 
U.S. Pursuant to Sec. 30.3(a)


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                                                            FR date and 
          Exchange                  Type of contract          citation  
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                          *    *    *    *    *                         
                                                                        
London International          Option Contract on Three-    199____; ____
 Financial Futures and         Month Eurolira               FR ____     
 Options Exchange.             (``Eurolira'') Interest                  
                               Rate Futures Contract.                   
                                                                        
                          *    *    *    *    *                         
                                                                        
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    Issued in Washington, D.C. on April 14, 1995.

Jean A. Webb,

Secretary to the Commission.

[FR Doc. 95-9636 Filed 4-18-95; 8:45 am]

BILLING CODE 6351-01-P