[Federal Register Volume 63, Number 119 (Monday, June 22, 1998)]
[Rules and Regulations]
[Pages 33848-33849]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-16520]


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COMMODITY FUTURES TRADING COMMISSION

17 CFR Part 1


Trading Hours

AGENCY: Commodity Futures Trading Commission.

ACTION: Final rule.

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SUMMARY: The Commodity Futures Trading Commission (``Commission'') is 
making amendments to its Regulation 1.41(k) to allow additional changes 
in trading hours to be deemed approved by the Commission one business 
day after receipt of written notice of a change in accordance with the 
regulation.

EFFECTIVE DATE: July 22, 1998.

FOR FURTHER INFORMATION CONTACT:
Lois J. Gregory, Attorney-Advisor, Contract Markets, Division of 
Trading and Markets, Commodity Futures Trading Commission, Three 
Lafayette Centre, 1155 21st Street, NW, Washington, D.C. 20581. 
Telephone: (202) 418-5483.

SUPPLEMENTARY INFORMATION: Regulation 1.41(k) allows a change in 
trading hours which does not permit trading to open before 7:00 a.m. or 
close after 6:00 p.m. local time in the city where the contract market 
is located to be deemed approved by the Commission at the close of 
business one business day after properly labeled written notice of the 
change is received by the Commission if the change is not inconsistent 
with the Commodity Exchange Act or the Commission's other regulations. 
Trading hour changes which do permit trading to open before 7:00 a.m. 
or close after 6:00 p.m. local time must be submitted to the Commission 
for approval pursuant to Regulation 1.41(b).
    On May 1, 1998 (63 FR 24142), the Commission published for comment 
proposed amendments to Regulation 1.41(k) to allow additional changes 
in trading hours, as set forth below, to be deemed approved by the 
Commission one business day after receipt of written notice of a change 
in accordance with the regulation. The comment period for the proposal 
was 15 days and closed on May 18, 1998. The Commission received two 
comments in response to the notice and both were supportive of the 
proposal.
    The Commission has determined to amend Regulation 1.41(k) in the 
manner previously notice. As revised, Regulation 1.41(k) will allow 
additional changes is trading hours to be deemed approved by the 
Commission one business day after receipt of written notice of a change 
in accordance with the subsection. Specifically, if a contract market 
has previously received Commission approval for trading between 6:00 
p.m. and 7:00 a.m. in at least one of its designated contracts, it may 
submit all subsequent changes in trading hours pursuant to Regulation 
1.41(k). Thus, under revised 1.41(k), the first time a contract market 
proposes changing trading hours for any of its designated contracts to 
fall between the hours of 6:00 p.m. to 7:00 a.m., the proposal must be 
submitted to the Commission for approval pursuant to Regulation 
1.41(b). The Commission will review such initial proposal to ensure 
that adequate systems and procedures are in place to accommodate the 
expanded trading hours. Matters to be addressed will include, among 
other matters, clearing, margin, market data, and surveillance 
programs. Any subsequent change to trading hours can be approved under 
the expedited procedures of Regulation 1.41(k).
    The Commission notes that listing a contract for trading on an 
automated trading system will constitute more than a change in trading 
hours. It will also be a change in the method of trading. Accordingly, 
neither the initial establishment of an electronic trading system nor 
the subsequent listing of additional contracts will be eligible for 
treatment under Regulation 1.41(k). However, changes in the trading 
hours of a contract that is already listed on an electronic system will 
be eligible for treatment under revised Regulation 1.41(k).

Related Matters

A. Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (Pub. L. 104-13 (May 13, 1995)) 
imposes certain requirements on federal agencies (including the 
Commission) in connection with their conducting or sponsoring any 
collection of information as defined by the Paperwork Reduction Act. 
While this proposed regulation has no burden, the group of regulations 
(3038-0022), of which this is a part has the following burden:

Average burden hours per response, 3,546.26
Number of Respondents, 10,971
Frequency of response, on occasion

    Copies of the OMB approved information collection package 
associated with this regulation may be obtained from the Desk Officer, 
CFTC, Office of Management and Budget, Room 10202, NEOB Washington DC 
20503, (202) 395-7340.

B. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) 5 U.S.C. 601 et seq., requires 
that agencies, in adopting regulations, consider the impact of those 
regulations on small businesses. The only entity this rulemaking will 
affect would be contract markets. The Commission has previously 
determined that contract markets are not ``small entities'' for 
purposes of the Regulatory Flexibility Act, (47 FR 18618 (April 30, 
1982)). Therefore, the Chairperson, on behalf of the Commission, hereby 
certifies, pursuant to 5 U.S.C. 605(b), that the action taken herein 
will not have a significant economic impact on a substantial number of 
small entities.

List of Subjects in 17 CFR Part 1

    Brokers, Commodity futures, Consumers protection, Reporting and 
recordkeeping requirements, Segregation requirements.

    In consideration of the foregoing and pursuant to the authority 
contained in the Commodity Exchange Act and, in particular Section 8a 
thereof, 7 U.S.C. 12a, the Commission hereby amends Part 1 of Chapter I 
of Title 17 of the Code of Federal Regulations as follows:

PART 1--GENERAL REGULATIONS UNDER THE COMMODITY EXCHANGE ACT

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

    Authority: 7 U.S.C. 1a, 2, 2a, 4, 4a, 6, 6a, 6b, 6c, 6d, 6e, 6f, 
6g, 6h, 6i, 6j, 6k, 6l, 6m, 6n, 6o, 6p, 7, 7a, 7b, 8, 9, 12, 12a, 
12c, 13a, 13a-1, 16, 16a, 19, 21, 23, and 24.

    2. Section 1.41 is amended by revising paragraph (k)(1) to read as 
follows: 1.41 Contract market rules; submission of rules to the 
Commission, exemption of certain rules.
* * * * *
    (k) Trading Hours. (1) Notwithstanding the provisions of paragraph 
(b) of this section and except in connection with an initial listing of 
a contract on an automated trading system, all changes in trading hours 
shall be deemed approved by the Commission at the close of business one 
business day after written notice of such a change is received by the 
Commission if:
    (i) The change is not inconsistent with any provision of the Act or 
the Commission's regulations;
    (ii) For a change that permits trading anytime between 6:00 p.m. 
and 7:00 a.m. local time in the city where the contract market is 
located, the contract

[[Page 33849]]

market has previously received Commission approval for trading between 
such hours in at least one of its designated contracts; and
    (iii) The contract market labels the written notice as being 
submitted pursuant to paragraph (k) of this section.
* * * * *
    Issued in Washington D.C. on June 16, 1998, by the Commission.
Jean A. Webb,
Secretary of the Commission.
[FR Doc. 98-16520 Filed 6-19-98; 8:45 am]
BILLING CODE 6351-01-M