17 CFR 1.69 - Voting by interested members of self-regulatory organization governing boards and various committees.

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§ 1.69 Voting by interested members of self-regulatory organization governing boards and various committees.
(a) Definitions. For purposes of this section:
(1) Disciplinary committee means any person or committee of persons, or any subcommittee thereof, that is authorized by a self-regulatory organization to issue disciplinary charges, to conduct disciplinary proceedings, to settle disciplinary charges, to impose disciplinary sanctions, or to hear appeals thereof in cases involving any violation of the rules of the self-regulatory organization except those cases where the person or committee is authorized summarily to impose minor penalties for violating rules regarding decorum, attire, the timely submission of accurate records for clearing or verifying each day's transactions or other similar activities.
(2) Family relationship of a person means the person's spouse, former spouse, parent, stepparent, child, stepchild, sibling, stepbrother, stepsister, grandparent, grandchild, uncle, aunt, nephew, niece or in-law.
(3) Governing board means a self-regulatory organization's board of directors, board of governors, board of managers, or similar body, or any subcommittee thereof, duly authorized, pursuant to a rule of the self-regulatory organization that has been approved by the Commission or has become effective pursuant to either Section 5a(a)(12)(A) or 17(j) of the Act to take action or to recommend the taking of action on behalf of the self-regulatory organization.
(4) Oversight panel means any panel, or any subcommittee thereof, authorized by a self-regulatory organization to recommend or establish policies or procedures with respect to the self-regulatory organization's surveillance, compliance, rule enforcement, or disciplinary responsibilities.
(5) Member's affiliated firm is a firm in which the member is a “principal,” as defined in § 3.1(a), or an employee.
(6) Named party in interest means a person or entity that is identified by name as a subject of any matter being considered by a governing board, disciplinary committee, or oversight panel.
(7) Self-regulatory organization means a “self-regulatory organization” as defined in § 1.3(ee) and includes a “clearing organization” as defined in § 1.3(d), but excludes registered futures associations for the purposes of paragraph (b)(2) of this section.
8) Significant action includes any of the following types of self-regulatory organization actions or rule changes that can be implemented without the Commission's prior approval:
(i) Any actions or rule changes which address an “emergency” as defined in § 1.41(a)(4)(i) through (iv) and (vi) through (viii); and,
(ii) Any changes in margin levels that are designed to respond to extraordinary market conditions such as an actual or attempted corner, squeeze, congestion or undue concentration of positions, or that otherwise are likely to have a substantial effect on prices in any contract traded or cleared at such self-regulatory organization; but does not include any rule not submitted for prior Commission approval because such rule is unrelated to the terms and conditions of any contract traded at such self-regulatory organization.
(b) Self-regulatory organization rules. Each self-regulatory organization shall maintain in effect rules that have been submitted to the Commission pursuant to Section 5a(a)(12)(A) of the Act and § 1.41 or, in the case of a registered futures association, pursuant to Section 17(j) of the Act, to address the avoidance of conflicts of interest in the execution of its self-regulatory functions. Such rules must provide for the following:
(1) Relationship with named party in interest—
(i) Nature of relationship. A member of a self-regulatory organization's governing board, disciplinary committee or oversight panel must abstain from such body's deliberations and voting on any matter involving a named party in interest where such member:
(A) Is a named party in interest;
(B) Is an employer, employee, or fellow employee of a named party in interest;
(C) Is associated with a named party in interest through a “broker association” as defined in § 156.1;
(D) Has any other significant, ongoing business relationship with a named party in interest, not including relationships limited to executing futures or option transactions opposite of each other or to clearing futures or option transactions through the same clearing member; or,
(E) Has a family relationship with a named party in interest.
(ii) Disclosure of relationship. Prior to the consideration of any matter involving a named party in interest, each member of a self-regulatory organization governing board, disciplinary committee or oversight panel must disclose to the appropriate self-regulatory organization staff whether he or she has one of the relationships listed in paragraph (b)(1)(i) of this section with a named party in interest.
(iii) Procedure for determination. Each self-regulatory organization must establish procedures for determining whether any member of its governing board, disciplinary committees or oversight committees is subject to a conflicts restriction in any matter involving a named party in interest. Taking into consideration the exigency of the committee action, such determinations should be based upon:
(A) Information provided by the member pursuant to paragraph (b)(1)(ii) of this section; and
(B) Any other source of information that is held by and reasonably available to the self-regulatory organization.
(2) Financial interest in a significant action—
(i) Nature of interest. A member of a self-regulatory organization's governing board, disciplinary committee or oversight panel must abstain from such body's deliberations and voting on any significant action if the member knowingly has a direct and substantial financial interest in the result of the vote based upon either exchange or non-exchange positions that could reasonably be expected to be affected by the action.
(ii) Disclosure of interest. Prior to the consideration of any significant action, each member of a self-regulatory organization governing board, disciplinary committee or oversight panel must disclose to the appropriate self-regulatory organization staff the position information referred to in paragraph (b)(2)(iii) of this section that is known to him or her. This requirement does not apply to members who choose to abstain from deliberations and voting on the subject significant action.
(iii) Procedure for determination. Each self-regulatory organization must establish procedures for determining whether any member of its governing board, disciplinary committees or oversight committees is subject to a conflicts restriction under this section in any significant action. Such determination must include a review of:
(A) Gross positions held at that self-regulatory organization in the member's personal accounts or “controlled accounts,” as defined in § 1.3(j);
(B) Gross positions held at that self-regulatory organization in proprietary accounts, as defined in § 1.17(b)(3), at the member's affiliated firm;
(C) Gross positions held at that self-regulatory organization in accounts in which the member is a principal, as defined in § 3.1(a);
(D) Net positions held at that self-regulatory organization in “customer” accounts, as defined in § 1.17(b)(2), at the member's affiliated firm; and,
(E) Any other types of positions, whether maintained at that self-regulatory organization or elsewhere, held in the member's personal accounts or the proprietary accounts of the member's affiliated firm that the self-regulatory organization reasonably expects could be affected by the significant action.
(iv) Bases for determination. Taking into consideration the exigency of the significant action, such determinations should be based upon:
(A) The most recent large trader reports and clearing records available to the self-regulatory organization;
(B) Information provided by the member with respect to positions pursuant to paragraph (b)(2)(ii) of this section; and,
(C) Any other source of information that is held by and reasonably available to the self-regulatory organization.
(3) Participation in deliberations.
(i) Under the rules required by this section, a self-regulatory organization governing board, disciplinary committee or oversight panel may permit a member to participate in deliberations prior to a vote on a significant action for which he or she otherwise would be required to abstain, pursuant to paragraph (b)(2) of this section, if such participation would be consistent with the public interest and the member recuses himself or herself from voting on such action.
(ii) In making a determination as to whether to permit a member to participate in deliberations on a significant action for which he or she otherwise would be required to abstain, the deliberating body shall consider the following factors:
(A) Wwhether the member's participation in deliberations is necessary for the deliberating body to achieve a quorum in the matter; and
(B) Whether the member has unique or special expertise, knowledge or experience in the matter under consideration.
(iii) Prior to any determination pursuant to paragraph (b)(3)(i) of this section, the deliberating body must fully consider the position information which is the basis for the member's direct and substantial financial interest in the result of a vote on a significant action pursuant to paragraph (b)(2) of this section.
(4) Documentation of determination. Self-regulatory organization governing boards, disciplinary committees, and oversight panels must reflect in their minutes or otherwise document that the conflicts determination procedures required by this section have been followed. Such records also must include:
(i) The names of all members who attended the meeting in person or who otherwise were present by electronic means;
(ii) The name of any member who voluntarily recused himself or herself or was required to abstain from deliberations and/or voting on a matter and the reason for the recusal or abstention, if stated; and
(iii) Information on the position information that was reviewed for each member.
[64 FR 23, Jan. 4, 1999; 64 FR 3340, Jan. 21, 1999]

Title 17 published on 2014-04-01

The following are only the Rules published in the Federal Register after the published date of Title 17.

For a complete list of all Rules, Proposed Rules, and Notices view the Rulemaking tab.

  • 2014-07-30; vol. 79 # 146 - Wednesday, July 30, 2014
    1. 79 FR 44125 - Enhancing Protections Afforded Customers and Customer Funds Held by Futures Commission Merchants and Derivatives Clearing Organizations; Correction
      GPO FDSys XML | Text
      COMMODITY FUTURES TRADING COMMISSION
      Correcting Amendments.
      Effective on July 30, 2014.
      17 CFR Parts 1, 30, and 140

This is a list of United States Code sections, Statutes at Large, Public Laws, and Presidential Documents, which provide rulemaking authority for this CFR Part.

This list is taken from the Parallel Table of Authorities and Rules provided by GPO [Government Printing Office].

It is not guaranteed to be accurate or up-to-date, though we do refresh the database weekly. More limitations on accuracy are described at the GPO site.


United States Code
U.S. Code: Title 7 - AGRICULTURE

§ 1a - Definitions

§ 2 - Jurisdiction of Commission; liability of principal for act of agent; Commodity Futures Trading Commission; transaction in interstate commerce

§ 5 - Findings and purpose

§ 6 - Regulation of futures trading and foreign transactions

§ 6a - Excessive speculation

§ 6b - Contracts designed to defraud or mislead

§ 6c - Prohibited transactions

§ 6d - Dealing by unregistered futures commission merchants or introducing brokers prohibited; duties in handling customer...rules to avoid duplicative regulations; swap requirements; portfolio margining accounts

§ 6e - Dealings by unregistered floor trader or broker prohibited

§ 6f - Registration and financial requirements; risk assessment

§ 6g - Reporting and recordkeeping

§ 6h - False self-representation as registered entity member prohibited

§ 6i - Reports of deals equal to or in excess of trading limits; books and records; cash and controlled transactions

§ 6k - Registration of associates of futures commission merchants, commodity pool operators, and commodity trading advisors; required disclosure of disqualifications; exemptions for associated persons

7 U.S. Code § -

§ 6m - Use of mails or other means or instrumentalities of interstate commerce by commodity trading advisors and commodity pool operators; relation to other law

§ 6n - Registration of commodity trading advisors and commodity pool operators; application; expiration and renewal; record keeping and reports; disclosure; statements of account

7 U.S. Code § -

§ 6p - Standards and examinations

§ 6r - Reporting and recordkeeping for uncleared swaps

§ 6s - Registration and regulation of swap dealers and major swap participants

§ 7 - Designation of boards of trade as contract markets

§ 7a - Repealed.

7 U.S. Code § 2a to 4a - Transferred

7 U.S. Code § 2a to 4a - Transferred

§ 7b - Suspension or revocation of designation as registered entity

7 U.S. Code § 2a to 4a - Transferred

§ 8 - Application for designation as contract market or derivatives transaction execution facility; time; suspension or revocation of designation; hearing; review by court of appeals

§ 9 - Prohibition regarding manipulation and false information

§ 10 - Repealed. June 25, 1948, ch. 646,

§ 10a - Cooperative associations and corporations, exclusion from board of trade; rules of board inapplicable to payment of compensation by association

§ 12 - Public disclosure

§ 12a - Registration of commodity dealers and associated persons; regulation of registered entities

§ 12c - Disciplinary actions

§ 13a - Nonenforcement of rules of government or other violations; cease and desist orders; fines and penalties; imprisonment; misdemeanor; separate offenses

7 U.S. Code § 12–1 to 12–3 - Omitted

§ 16 - Commission operations

§ 16a - Service fees and National Futures Association study

§ 19 - Consideration of costs and benefits and antitrust laws

§ 21 - Registered futures associations

§ 23 - Standardized contracts for certain commodities

§ 24 - Customer property with respect to commodity broker debtors; definitions

Statutes at Large

Title 17 published on 2014-04-01

The following are ALL rules, proposed rules, and notices (chronologically) published in the Federal Register relating to 17 CFR 1 after this date.

  • 2014-07-30; vol. 79 # 146 - Wednesday, July 30, 2014
    1. 79 FR 44125 - Enhancing Protections Afforded Customers and Customer Funds Held by Futures Commission Merchants and Derivatives Clearing Organizations; Correction
      GPO FDSys XML | Text
      COMMODITY FUTURES TRADING COMMISSION
      Correcting Amendments.
      Effective on July 30, 2014.
      17 CFR Parts 1, 30, and 140