Proposed Rule

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PROPOSED RULE AMENDMENTS
(additions are underscored and deletions are stricken through)

REGISTRATION RULES

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RULE 202. REGISTRATION PROCESSING AND NOTIFICATION OF REGISTRATION OR CONFIRMATION OF EXEMPTION FROM REGISTRATION.

(a) If registration has been granted or a temporary license issued under the Act, NFA shall notify the applicant, or the sponsor in the case of an applicant for registration as an AP, and each board of trade designated as a contact market or a derivative transaction execution facility ("DTF") by the Commission that has granted the applicant trading privileges in the case of an applicant for registration as an FB or FT. If an exemption from registration pursuant to CFTC Regulation 30.5 has been confirmed, NFA shall notify the applicant accordingly.

(b) NFA may provide any notice required by these Rules electronically unless written notice is specifically required. Notices provided electronically shall be complete upon display in NFA's Online Registration System. Notices provided in writing shall be complete upon mailing.

RULE 203. REGISTRATION FEES.

(a) Amount. The following fees shall apply:

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(13) Exempt Foreign Introducing Broker, Commodity Pool Operator or Commodity Trading Advisor. $100 for each Form 7-R filed for exemption from registration as an IB, CPO or CTA pursuant to Commission Regulation 30.5.

(b) Form of Remittance. Registration fees must be remitted by check, bank draft or money order payable to NFA or by using NFA's Online Registration System Online Deposit function. All registration fees are non-refundable.

RULE 204. REGISTRATION OF FUTURES COMMISSION MERCHANTS, NOTICE FUTURES COMMISSION MERCHANTS, INTRODUCING BROKERS, NOTICE INTRODUCING BROKERS, COMMODITY POOL OPERATORS, COMMODITY TRADING ADVISORS AND LEVERAGE TRANSACTION MERCHANTS AND CONFIRMATION OF EXEMPTION FROM REGISTRATION PURSUANT TO COMMISSION REGULATION 30.5.

(a) Application for Registration or Exemption from Registration.

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    (5)(A) Each person applying for exemption from registration as a IB, CPO or CTA pursuant to the provisions of CFTC Regulation 30.5 must:

      (i) file a Form 7-R, completed and filed in accordance with all pertinent instructions;

      (ii) file the written agreement in the form specified in CFTC Regulation 30.5(a), provided that if the agreement is between the applicant and NFA, the agreement shall be an electronic agreement; and

      (iii) pay the fee required by Rule 203(a)(13).

    (B) Each IB, CPO or CTA applying for exemption or confirmed as exempt from registration pursuant to CFTC Regulation 30.5 shall promptly notify NFA in the event that the agreement in paragraph (a)(5)(A) of this Rule is terminated. NFA shall deem the failure of an IB, CPO or CTA confirmed as exempt from registration pursuant to CFTC Regulation 30.5 to file a new agreement within 30 days following the date of termination of the prior agreement a request to withdraw the confirmation of the exemption pursuant to CFTC Regulation 30.5, and shall notify the IB, CPO or CTA confirmed as exempt from registration pursuant to CFTC Regulation 30.5 accordingly.

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(d) Annual Registration Records Maintenance Fees. On an annual basis, NFA shall send an invoice to each FCM, IB, CPO, CTA, and LTM registered in accordance with paragraph (a)(1) of this Rule or confirmed as exempt from registration in accordance with paragraph (a)(5) of this Rule requesting payment of the annual registration records maintenance fee set forth in Rule 203(a) and any other outstanding registration fees. NFA shall deem the failure to pay the required annual registration records maintenance fee and any other outstanding registration fees within 30 days following such date a request to withdraw from registration or to withdraw the confirmation of the exemption pursuant to CFTC Regulation 30.5, and shall notify the registrant or IB, CPO or CTA confirmed as exempt from registration pursuant to CFTC Regulation 30.5 accordingly.

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PART 800. ELECTRONIC FILING OF REGISTRATION FORMS.

RULE 801. ELECTRONIC FILING OF FORMS 7-R, 8-R, 3-R, 7-W AND 8-T.

(a) Unless otherwise provided by these Rules, registrants which are FCMs, IBs, CPOs, CTAs, FBs and FTs, IBs, CPOs and CTAs which are confirmed as exempt from registration pursuant to CFTC Regulation 30.5 and applicants for registration in such categories or for exemption from registration as an IB, CPO or CTA pursuant to CFTC Regulation 30.5 must file their Form 7-Rs and Form 8-Rs; Form 8-Rs for their principals and for registration of their APs; Form 3-Rs for themselves, their APs and principals; Form 7-Ws; and Form 8-Ts electronically by accessing NFA's registration and membership database in the manner provided by NFA. FCM, IB, CPO and CTA registrants or applicants, IBs, CPOs and CTAs that are confirmed as exempt from registration pursuant to CFTC Regulation 30.5 or applicants for exemption from registration as an IB, CPO or CTA pursuant to CFTC Regulation 30.5 may authorize any person to make electronic registration filings on their behalf. FB and FT registrants and applicants may authorize any other person to electronically file Form 3-Rs on their behalf but may not authorize any other person to file Form 8-Rs on their behalf. Any electronic registration filing that such an authorized person makes on behalf of the FCM, IB, CPO, CTA, FB or FT registrant or applicant or IB, CPO or CTA confirmed as exempt from registration pursuant to CFTC Regulation 30.5 or applicant for exemption from registration pursuant to CFTC Regulation 30.5 shall be deemed to have been made by the FCM, IB, CPO, CTA, FB or FT registrant or applicant or IB, CPO or CTA confirmed as exempt from registration pursuant to CFTC Regulation 30.5 or applicant for exemption from registration pursuant to CFTC Regulation 30.5 granting the authorization to such person.

(b) Individuals for whom a sponsor has filed a Form 8-R must, if required by these Rules to do so, verify the information electronically by accessing NFA's registration and membership database in the manner provided by NFA. Individuals may not authorize any other person to make such verification on their behalf.

(c) No applicant, applicant for exemption from registration as an IB, CPO or CTA pursuant to CFTC Regulation 30.5, registrant, IB, CPO or CTA confirmed as exempt from registration pursuant to CFTC Regulation 30.5 or principal may access NFA's electronic registration and membership database until NFA has assigned it a unique identifying code and password.

(d) Each applicant, applicant for exemption from registration as an IB, CPO or CTA pursuant to CFTC Regulation 30.5, registrant, IB, CPO or CTA confirmed as exempt from registration pursuant to CFTC Regulation 30.5 and principal is responsible for maintaining the security and confidentiality of its identifying code and password and those of the persons whom it authorizes to make electronic registration filings on its behalf. NFA's electronic registration and membership database shall record and store the identifying code of each person accessing the database and shall logically associate in the database such identifying code with any electronic filing made by the person using such identifying code. The person whose identifying code is used to make an electronic filing will be deemed to have made such filing.

(e) Each registrant or applicant FCM, IB, CPO, CTA, FB or FT or IB, CPO or CTA confirmed as exempt from registration pursuant to CFTC Regulation 30.5 or applicant for exemption from registration as an IB, CPO or CTA pursuant to CFTC Regulation 30.5 shall make available any person it has authorized to make or actually performing duties related to electronic filings, for testimony in court or before the Commission, NFA, any contract market or any DTF regarding the authentication, integrity or accuracy of any electronic filing.

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RULE 802. CERTIFICATIONS, ACKNOWLEDGEMENTS, AGREEMENTS AND REPRESENTATIONS.

(a) The electronic filing of a Form 7-R for registration as an FCM, IB, CPO and CTA or for exemption from registration as an IB, CPO and CTA pursuant to CFTC Regulation 30.5 is deemed to constitute the applicant's:

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    (5) acknowledgement that the applicant may not act as an FCM, IB, CPO or CTA until registration has been granted; or in the case of an IB, until registration or a temporary license has been granted; or until confirmation of exemption from registration as an IB, CPO or CTA pursuant to CFTC Regulation 30.5 is granted;

    (6) authorization that NFA may conduct an investigation to determine the applicant's fitness for registration or for confirmation of exemption from registration as an IB, CPO and CTA pursuant to CFTC Regulation 30.5 and, if applicable, NFA membership and agreement to cooperate promptly and fully, consistent with applicable Federal law, in such investigation, which investigation may include contacting foreign regulatory and law enforcement authorities, including the submission of documents and information to NFA that NFA, in its discretion, may require in connection with the applicant's application for registration, confirmation of exemption from registration as an IB, CPO and CTA pursuant to CFTC Regulation 30.5 or NFA membership;

    (7) authorization and request that any person, including but not limited to contract markets or DTFs, furnish upon request to NFA or any agent acting on behalf of NFA any information requested by NFA in connection with any investigation conducted by NFA to determine the applicant's fitness for registration or for confirmation of exemption from registration as an IB, CPO and CTA pursuant to CFTC Regulation 30.5;

    (8) agreement that any person furnishing information to NFA or any agent acting on behalf of NFA in connection with the investigation so authorized is released from any and all liability of whatever nature by reason of furnishing such information to NFA or any agent acting on behalf of NFA; and

    (9) agreement that, if the applicant is a foreign applicant:

      (i) the applicant's books and records will be available for inspection by the CFTC, the U.S. Department of Justice ("DOJ") and NFA for purposes of determining compliance with the Act, CFTC Regulations and NFA Requirements;

      (ii) such books and records will be produced on 72 hours notice at the location in the United States stated in the Form 7-R or, in the case of an IB, CPO or CTA confirmed as exempt from registration pursuant to CFTC Regulation 30.5, at the location specified by the CFTC or DOJ;

      (iii) the applicant will immediately notify NFA of any changes to the location in the United States where such books and records will be produced;

      (iv) the applicant is not subject to any blocking, privacy or secrecy laws which would interfere with or create an obstacle to full inspection of the applicant's books and records by the CFTC, DOJ and NFA; and

      (v) the failure to provide the CFTC, DOJ or NFA with access to its books and records in accordance with this agreement may be grounds for enforcement and disciplinary sanctions; denial, suspension or revocation of registration; withdrawal of confirmation of exemption from registration as an IB, CPO or CTA pursuant to CFTC Regulation 30.5; and denial, suspension or termination of NFA membership.; and

    (10) representation that if the applicant is an applicant for exemption from registration as an IB, CPO or CTA pursuant to CFTC Regulation 30.5:

      (i) the applicant does not act as an IB, CPO or CTA, respectively, in connection with trading on or subject to the rules of a designated contract market in the United States by, for or on behalf of any U.S. customer, client or pool;

      (ii) the applicant irrevocably agrees to the jurisdiction of the Commission and state and federal courts located in the U.S. with respect to activities and transactions subject to Part 30 of the CFTC's regulations; and

      (iii) the applicant would not be statutorily disqualified from registration under 8a(2) or 8a(3) of the Act and is not disqualified from registration pursuant to the laws or regulations of its home country.

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(f) Retention of Records. In accordance with Commission Regulation 1.31, FCM, IB, CTA, CPO, LTM, FB and FT applicants and registrants and their sponsors, if applicable, applicants for exemption from registration as an IB, CPO or CTA pursuant to CFTC Regulation 30.5 and IBs, CPOs and CTAs confirmed as exempt from registration pursuant to CFTC Regulation 30.5 must retain such records as are necessary to support the certifications required by this Rule.

BYLAWS OF NATIONAL FUTURES ASSOCIATION

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BYLAW 301. REQUIREMENTS AND RESTRICTIONS

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(j) Notice.

NFA may provide any notice required by Bylaw 301 electronically unless written notice is specifically required. Notices provided electronically shall be complete upon display in NFA's Online Registration System. Notices provided in writing shall be complete upon mailing.

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