Compliance Rules

Part 2 - Rules Governing the Business Conduct of Members Registered with the Commission

RULE 2-40. BULK ASSIGNMENT OR LIQUIDATION OF FOREX POSITIONS; CESSATION OF CUSTOMER BUSINESS.

[Adopted effective February 16, 2007. Effective dates of amendments: June 5, 2007 and November 15, 2011.]

(a) Bulk Assignment, Transfer, or Liquidation. A Forex Dealer Member or an IB may not enter into a bulk assignment, transfer, or liquidation of forex positions or accounts unless the assignment, liquidation, or transfer complies with CFTC Regulation 5.23 and the procedures established by NFA in the Interpretive Notice entitled NFA Compliance Rule 2-40: Procedures for Bulk Assignment or Liquidation of Forex Positions; Cessation of Customer Business.

(b) Ceasing Business. A Forex Dealer Member must notify NFA by e-mail or facsimile seven calendar days prior to ceasing its forex business.

(c) Definitions. For purposes of this rule, the term "forex" has the same meaning as in Bylaw 1507(b) and the term "customer" means a counterparty that is not eligible contract participant as defined in 1a(18) of the Act.