Commodity Futures Trading Commission Proposes Position Limits For Commodity Derivatives

Summary

The Commodity Futures Trading Commission (the "Commission" or "CFTC") is proposing to establish a framework for implementing position limits for certain physical commodity derivatives, including exchange-traded futures and options on futures contracts and swaps that are economically equivalent to such contracts, in accordance with Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 ("Dodd-Frank Act"). The proposal also includes: (i) amendments to the bona fide hedging exemption; (ii) an exemption for positions established in good faith prior to the effective date of specific limits that could be adopted in final rules; (iii) new account aggregation standards; (iv) position visibility levels and associated reporting requirements for traders with positions exceeding specified thresholds in certain metal and energy commodities; and (v) rules imposing requirements and standards for position limits and accountability rules that are