The CFTC issued an Order authorizing members of an Indian Exchange to use U.S. customer funds in certain transactions without their having to register with the CFTC.
The Order was issued pursuant to CFTC's Part 30 exemptive program, which allows foreign brokers in countries with comparable regulatory systems to deal directly with U.S. futures. Effectively, National Stock Exchange of India Ltd. ("NSE") members will be able to accept U.S. customer funds for trading in futures and options contracts on NSE without having to register with the CFTC as futures commission merchants. The Order is contingent upon the NSE notifying the CFTC of any relevant changes to the local laws or regulations that govern the NSE. The CFTC noted that the exemption does not extend to swaps transactions.
According to the Order, the CFTC deferred to the authority of the NSE concerning transactions in Indian products. In a statement accompanying the Order, CFTC Chair J. Christopher Giancarlo highlighted the CFTC's commitment to deferring to comparable foreign regulatory regimes in order to accommodate "market-led activity . . . across international markets."
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
