Principal contract
Principal contract means a contract which is not traded on a designated contract market, and includes leverage contracts and dealer options, but does not include:
(1) Transactions executed off the floor of a designated contract market pursuant to rules approved by the Commission or rules which the designated contract market is required to enforce, or pursuant to rules of a foreign board of trade located outside the United States, its territories or possessions; or
(2) Cleared swaps contracts.
(ii) Public customer means any person defined as a customer under paragraph (k) of this section except a non-public customer.
(jj) Security shall have the same meaning as that set forth in section 101(36) of the Bankruptcy Code.
(kk) Short term obligation means any security, note, or other obligation with a duration or maturity date of 180 days or less.
(ll) Specifically identifiable property means:
(1) With respect to the following property received, acquired, or held by or for the account of the debtor from or for the account of a customer to margin, guarantee or secure an open commodity contract:
(i) Any security which as of the filing date is:
(A) Held for the account of a customer;
(B) Registered in such customer's name;
(C) Not transferable by delivery; and
(D) Not a short term obligation; or
(ii) Any warehouse receipt, bill of lading or other document of title which as of the filing date:
(A) Can be identified on the books and records of the debtor as held for the account of a particular customer; and
(B) Is not in bearer form and is not otherwise transferable by delivery.
(2) With respect to open commodity contracts, and except as otherwise provided in paragraph (kk)(7) of this section, any such contract which:
(i) As of the filing date is identified on the books and records of the debtor as held for the account of a particular customer;
(ii) Is a bona fide hedging position or transaction as defined in § 1.3 of this chapter or is a commodity option transaction which has been determined by the registered entity to be economically appropriate to the reduction of risks in the conduct and management of a commercial enterprise pursuant to rules which have been approved by the Commission pursuant to section 5c(c) of the Commodity Exchange Act; and
(iii) Is in an account designated in the accounting records of the debtor as a hedging account in accordance with § 190.04(e)(1).
(3) With respect to warehouse receipts, bills of lading or other documents of title, or physical commodities received, acquired, or held by or for the account of the debtor for the purpose of making or taking delivery or exercise from or for the account of a customer, any such document of title or commodity which as of the entry of the order for relief can be identified on the books and records of the debtor as received from or for the account of a particular customer as held specifically for the purpose of delivery or exercise.
(4) Any cash or other property deposited prior to the entry of the order for relief to pay for the taking of physical delivery on a long commodity contract or for payment of the strike price upon exercise of a short put or a long call option contract on a physical commodity, which cannot be settled in cash, in excess of the amount necessary to margin such commodity contract prior to the notice date or exercise date, which cash or other property is identified on the books and records of the debtor as received from or for the account of a particular customer on or after three calendar days before the first notice date or three calendar days before the exercise date specifically for the purpose of payment of the notice price upon taking delivery or the strike price upon exercise, respectively, and such customer takes delivery or exercises the option in accordance with the applicable designated contract market rules.
(5) The cash price tendered for any property deposited prior to the entry of the order for relief to make physical delivery on a short commodity contract or for exercise of a long put or a short call option contract on a physical commodity, which cannot be settled in cash, to the extent it exceeds the amount necessary to margin such contract prior to the notice date or exercise date, which property is identified on the books and records of the debtor as received from or for the account of a particular customer on or after three calendar days before the first notice date or three calendar days before the exercise date specifically for the purpose of a delivery or exercise, respectively, and such customer makes delivery or exercises the option in accordance with the applicable contract market rules.
(6) Notwithstanding paragraph (kk)(1) of this section, fully paid, non-exempt securities identified on the books and records of the debtor as held by the debtor for or on behalf of the commodity contract account of a particular customer for which, according to such books and records as of the filing date, no open commodity contracts were held in the same capacity.
(7) Open commodity contracts transferred in accordance with the provisions of § 190.06.
(8) Except as is otherwise specified in this paragraph (kk), no customer property may be treated as specifically identifiable property.
(9) Notwithstanding any other provision of this paragraph (kk), security futures products, and any money, securities or property held to margin, guarantee or secure such products, or accruing as a result of such products, shall not be considered specifically identifiable property for the purposes of Subchapter IV of the Bankruptcy Code or this part 190, if held in a securities account.