[Federal Register Volume 70, Number 10 (Friday, January 14, 2005)]
[Rules and Regulations]
[Pages 2565-2566]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-817]


=======================================================================
-----------------------------------------------------------------------

COMMODITY FUTURES TRADING COMMISSION

17 CFR Part 140

RIN 3038-AC18


Delegation of Authority to Director of the Division of Clearing 
and Intermediary Oversight; Correction

AGENCY: Commodity Futures Trading Commission.

ACTION: Technical amendments.

-----------------------------------------------------------------------

SUMMARY: This document contains technical amendments to the final rule 
amendments that were published on October 7, 2002 (67 FR 62350). This 
rule relates to delegations of authority from the Commodity Futures 
Trading Commission (Commission) to its staff.

EFFECTIVE DATES: January 14, 2005.

FOR FURTHER INFORMATION CONTACT: Barbara S. Gold, Associate Director, 
or Peter Sanchez, Attorney Advisor, Division of Clearing and 
Intermediary Oversight, Commodity Futures Trading Commission, 1155 21st 
Street, NW., Washington, DC 20581, telephone numbers: (202) 418-5450 or 
(202) 418-5237, respectively; facsimile number: (202) 418-5528; and 
electronic mail: [email protected] or [email protected], respectively.

SUPPLEMENTARY INFORMATION:

1. Technical Amendments

    By Rule 140.93, the Commission has delegated to the Director of the 
Division of Clearing and Intermediary Oversight (DCIO) various 
functions reserved to the Commission under Part 4 of the Commission's 
regulations, which relates to the operations and activities of 
commodity pool operators (CPOs) and commodity trading advisors.\1\ As 
is explained below, the technical amendments the Commission is making 
to Rule 140.93 conform the rule to changes the Commission previously 
has made to certain paragraphs of the rule itself and to certain other 
rules to which Rule 140.93 applies.
---------------------------------------------------------------------------

    \1\ Rule 140.93 further extends this delegation ``to such 
members of the Commission's staff acting under [the Director's] 
direction as he may designate from time to time.''
    Commission rules cited to herein are found at 17 CFR Ch. I 
(2004). Both the Commodity Exchange Act (Act), 7 U.S.C. 1 et seq. 
(2000), and the Commission's rules issued thereunder can be accessed 
through the Commission's Web site, at: http://www.cftc.gov/cftc/cftclawreg.htm.
---------------------------------------------------------------------------

    On October 7, 2002, the Commission amended its rules to reflect the 
reassignment of responsibilities, including delegations of authority 
pursuant to Rule 140.83, resulting from its reorganization of its 
staff. Under the reorganized structure, the (former) Divisions of 
Trading and Markets and Economic Analysis were reconfigured into two 
new divisions and one new office, DCIO, the Division of Market 
Oversight, and the Office of the Chief Economist. As amended, the 
Commission's rules reflected new assignments of responsibilities, 
including delegated authorities. In this regard, the Commission removed 
the words ``Trading and Markets'' from the body of Rule 140.93 and 
added, in their place, the words ``Clearing and Intermediary 
Oversight.'' However, the Commission neglected at that time to make a 
similar amendment to the title of the rule itself. Accordingly, one of 
the technical amendments the Commission is making is the removal of the 
words ``Trading and Markets'' from the title of Rule 140.93 and the 
addition, in their place, of the words ``Clearing and Intermediary 
Oversight.''
    One of the rules to which Rule 140.93 applies is Rule 4.22, which 
concerns the Annual Report that a CPO registered or required to be 
registered under the Act must prepare and distribute to each 
participant in each pool it operates. On December 11, 2002, the 
Commission delegated to the National Futures Association (NFA) all 
functions under Rule 4.22(f)--e.g., the receiving and granting or 
denying of applications for extensions of time to distribute Annual 
Reports.\2\ On that date, the Commission also amended Rule 4.22(f) by 
removing the word ``Commission'' from the rule and adding, in its 
place, the words ``National Futures Association.'' \3\ Thus, other 
technical amendments the Commission is making are the removal of 
paragraph (a)(2) of Rule 140.93 (such that Rule 140.93 no longer refers 
to Rule 4.22(f)) and the redesignation of paragraphs (a)(3) through 
(a)(6) of Rule 140.93 as paragraphs (a)(2) through (a)(5) of Rule 
140.93.
---------------------------------------------------------------------------

    \2\ 67 FR 77470 (December 18, 2002). NFA is a futures 
association registered as such with the Commission under Section 17 
of the Act, 7 U.S.C. 21 (2000).
    \3\ 67 FR 77409 (December 18, 2002). The Commission did not 
delegate to NFA any functions under Rule 4.22(g), which concerns the 
election by a CPO of its pool's fiscal year and the authority of the 
Commission to disapprove a change of fiscal year after a fiscal year 
has been chosen.
---------------------------------------------------------------------------

    Another of the rules to which Rule 140.93 applies is Rule 4.5, 
which, among other things, provides an exclusion from the term 
``commodity pool operator'' for specified ``eligible persons'' with 
respect to their operation of certain ``qualifying entities,'' provided 
those persons comply with certain conditions in operating those 
entities. On August 1, 2003, the Commission eliminated certain of those 
conditions from Rule 4.5 by removing paragraphs (c)(2)(i) and 
(c)(2)(ii) and redesignating paragraphs (c)(2)(iii) and (c)(2)(iv) as 
paragraphs (c)(2)(i) and (c)(2)(ii) of the rule.\4\ At that time, 
however, the Commission did not also amend Rule 140.93 to make 
conforming changes to its references to Rule 4.5. To remedy this 
oversight, the final technical amendment the Commission is making is 
the correction in (newly redesignated) Rule 140.93(a)(4) to refer to 
Rule 4.5(c)(2)(ii).
---------------------------------------------------------------------------

    \4\ 68 FR 47221 (August 8, 2003).
---------------------------------------------------------------------------

II. Need for Correction

    As published, Rule 140.93 contains text which no longer is 
accurate. Thus, it is in need of correction.

III. Related Matters

A. The Administrative Procedure Act

    The Commission finds that that Rule 140.93 relates solely to agency 
practice and procedure and that notice of proposed rulemaking and 
opportunity for public participation are not required. Thus, the 
Commission has determined to make the amendments to Rule 140.93 
effective immediately. The forgoing is in accordance with the 
Administrative Procedure Act, as codified, 5 U.S.C. 553.\5\
---------------------------------------------------------------------------

    \5\ See 46 FR 26003, 26013, (May 6, 1981).
---------------------------------------------------------------------------

B. The Regulatory Flexibility Act

    The Regulatory Flexibility Act (``RFA''), 5 U.S.C. 601, et seq., 
requires that agencies, in proposing rules, consider the impact of 
those rules on small businesses. The RFA defines the term ``rule'' to 
mean ``any rule for which the agency publishes a general notice of 
proposed rulemaking pursuant to section 553(b) of this title * * * for 
which the agency provides an opportunity for notice and public

[[Page 2566]]

comment.'' 5 U.S.C. 601(2). Since the rules are not being effected 
pursuant to section 553(b), they are not ``rules'' as defined in the 
RFA, and the analysis and certification process certified in that 
statute do not apply.

C. The Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (PRA), 44 U.S.C. 3501, et seq., 
which imposes certain requirements on federal agencies, including the 
Commission, in connection with their conducting or sponsoring any 
collection of information as defined by the PRA, does not apply to 
these rule amendments because these rule amendments do not contain 
information collection requirements as defined by the PRA.

D. Cost-Benefit Analysis

    Section 15 of the Act, as amended by section 119 of the CFMA, 
requires the Commission, before issuing a new regulation under the Act, 
to consider the costs and benefits of its action. The Commission 
understands that, by its terms, section 15 does not require the 
Commission to quantify the costs and benefits of a new regulation or to 
determine whether the benefits of the proposed regulation outweigh its 
costs.
    Section 15 further specifies that costs and benefits shall be 
evaluated in light of five broad areas of market and public concern: 
(1) Protection of market participants and the public; (2) efficiency, 
competitiveness, and financial integrity of futures markets; (3) price 
discovery; (4) sound risk management practices; and (5) other public 
interest considerations. Accordingly, the Commission could in its 
discretion give greater weight to any one of the five enumerated areas 
of concern and could in its discretion determine that, notwithstanding 
its costs, a particular rule was necessary or appropriate to protect 
the public interest or to effectuate any of the provisions or to 
accomplish any of the purposes of the Act.
    The Commission has considered the costs and benefits of this rule 
package in light of the specific areas of concern identified in section 
15, at the time that the Commission delegated these responsibilities to 
the Division and the National Futures Association.

List of Subjects in 17 CFR Part 140

    Authority delegations (Government agencies), Organization and 
functions (Government agencies).

PART 140--ORGANIZATION, FUNCTIONS, AND PROCEDURES OF THE COMMISSION

0
Accordingly, 17 CFR part 140 is corrected by making the following 
technical amendments:
0
1. The authority citation for part 140 continues to read as follows:

    Authority: 7 U.S.C. 2, 12a.


Sec.  140.93  [Corrected]

0
2. In Sec.  140.93:
0
a. Remove the words ``Trading and Markets'' in the title and add, in 
their place, ``Clearing and Intermediary Oversight.''
0
b. Remove paragraph (a)(2);
0
c. Redesignate paragraphs (a)(3) and (a)(4) as paragraphs (a)(2) and 
(a)(3), respectively;
0
d. Redesignate paragraph (a)(5) as paragraph (a)(4) and correct ``Sec.  
4.5(c)(2)(v)'' in newly redesignated paragraph (a)(4) to read ``Sec.  
4.5(c)(2)(ii)''; and
0
e. Redesignate paragraph (a)(6) as paragraph (a)(5).
* * * * *

    Issued in Washington, DC, on January 11, 2005 by the Commission.
Jean A. Webb,
Secretary of the Commission.
[FR Doc. 05-817 Filed 1-14-05; 8:45 am]
BILLING CODE 8351-01-P