Proposed Rule

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Explanation of Resubmitted Proposed Amendments to NFA Compliance Rule 2-35 and Proposed New Interpretive Notice

Subsequent to NFA's original submission of the proposed amendments to Compliance Rule 2-35, NFA staff has had ongoing discussions with Commission staff regarding the rule proposal. The proposed amendments and the proposed interpretive notice address the Commission's concerns. Specifically, the provision in the Rule regarding disclosure of material risks associated with the pool was reworded, and the interpretive notice was drafted to fully explain the type of risk disclosures that should be included in the profile document. In addition, the Rule was amended to require disclosure of certain conflicts of interest, and an explanation of this requirement is included in the interpretive notice.

The cautionary statement's format was amended, moving away from an all capital letter format and making it more readable by highlighting the key points with bullet marks. Furthermore, as CTA disclosure documents are not nearly as voluminous as CPO documents, this provision was eliminated from the rule proposal.

Please refer to NFA's September 10, 1998 submission letter for a further explanation of Rule 2-35 as it relates to CPO profile documents.

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