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U.S. Code as of:
01/03/05
Section 23. Standardized contracts for certain commodities
(a) Margin accounts or contracts and leverage accounts or contracts
prohibited except as authorized
Except as authorized under subsection (b) of this section, no
person shall offer to enter into, enter into, or confirm the
execution of, any transaction for the delivery of any commodity
under a standardized contract commonly known to the trade as a
margin account, margin contract, leverage account, or leverage
contract, or under any contract, account, arrangement, scheme, or
device that the Commission determines serves the same function or
functions as such a standardized contract, or is marketed or
managed in substantially the same manner as such a standardized
contract.
(b) Permission to enter into contracts for delivery of silver or
gold bullion, bulk silver or gold coins, or platinum; rules and
regulations
(1) Subject to paragraph (2), no person shall offer to enter
into, enter into, or confirm the execution of, any transaction for
the delivery of silver bullion, gold bullion, bulk silver coins,
bulk gold coins, or platinum under a standardized contract
described in subsection (a) of this section, contrary to the terms
of any rule, regulation, or order that the Commission shall
prescribe, which may include terms designed to ensure the financial
solvency of the transaction or prevent manipulation or fraud. Such
rule, regulation, or order may be made only after notice and
opportunity for hearing. The Commission may set different terms and
conditions for transactions involving different commodities.
(2) No person may engage in any activity described in paragraph
(1) who is not permitted to engage in such activity, by the rules,
regulations, and orders of the Commission in effect on November 10,
1986, until the Commission permits such person to engage in such
activity in accordance with regulations issued in accordance with
subsection (c)(2) of this section.
(c) Survey of persons interested in engaging in transactions of
silver and gold, etc.; assistance of futures association;
regulations
(1)(A) Not later than 2 years after November 10, 1986, the
Commission shall -
(i) with the assistance of a futures association registered
under this chapter, conduct a survey concerning the persons
interested in engaging in the business of offering to enter into,
entering into, or confirming the execution of, the transactions
described in subsection (b)(1) of this section; and
(ii) transmit a report of the results of the survey to the
Committee on Agriculture of the House of Representatives and the
Committee on Agriculture, Nutrition, and Forestry of the Senate.
(B) Notwithstanding any other provision of law, for purposes of
completing such report the Commission may direct, by rule,
regulation, or order, a futures association registered under this
chapter to render such assistance as the Commission shall specify.
(C) Such report shall include the findings and any
recommendations of the Commission concerning -
(i) whether such transactions serve an economic purpose;
(ii) the most efficient manner, consistent with the public
interest, to permit additional persons to engage in the business
of offering to enter into, entering into, and confirming the
execution of such transactions; and
(iii) the appropriate regulatory scheme to govern such
transactions to ensure the financial solvency of such
transactions and to prevent manipulation or fraud.
(2) The report shall also include Commission regulations
governing such transactions. The regulations shall provide for
permitting additional persons to engage in such transactions. The
regulations shall become effective on the expiration of 90 calendar
days on which either House of Congress is in session after the date
of the transmittal of the report to Congress. The regulations -
(A) may authorize or require, notwithstanding any other
provision of law, a futures association registered under this
chapter to perform such responsibilities in connection with such
transactions as the Commission may specify; and
(B) may require that permission for additional persons to
engage in such business be given on a gradual basis, so as not to
place an undue burden on the resources of the Commission.
(d) Savings provision
This section shall not affect any rights or obligations arising
out of any transaction subject to this section, as in effect before
November 10, 1986, that was entered into, or the execution of which
was confirmed, before November 10, 1986.
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