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Wed, 15 Sep 2017— Amendments to Bylaw 301. An explanation of the amendments and Interpretive Notice can be found in the August 30, 2017 rule submission letter.
Wed, 15 Sep 2017— Amendments to Registration Rules. An explanation of the amendments and Interpretive Notice can be found in the August 30, 2017 rule submission letter.
Wed, 15 Sep 2017— Amendments to Compliance Rule 2-9: NFA Interpretive Notice NFA Compliance Rule 2-9: Special Supervisory Requirements for Members Registered as Broker Dealers Under Section 15(b)(11) of the Securities Exchange Act of 1934. An explanation of the amendments and Interpretive Notice can be found in the August 30, 2017 rule submission letter.
SECTION 12. SECURITY DEPOSITS FOR FOREX TRANSACTIONS WITH FOREX DEALER MEMBERS.
[Adopted Effective December 1, 2003. Effective dates of amendments: June 6, 2004; September 15, 2005; February 13, 2007; May 14, 2008; October 31, 2008; November 30, 2009; October 18, 2010 and January 4, 2016.]
(a) Each Forex Dealer Member shall collect and maintain the following minimum security deposit for each forex transaction between the Forex Dealer Member and its customers and/or eligible contract participant counterparties:
(i) 2% of the notional value of transactions in the British pound, the Swiss franc, the Canadian dollar, the Japanese yen, the Euro, the Australian dollar, the New Zealand dollar, the Swedish krona, the Norwegian krone, and the Danish krone;
(ii) 5% of the notional value of other transactions;
(iii) for short options, the above amount plus the premium received; and
(iv) for long options, the entire premium.
(b) The Executive Committee may temporarily increase these requirements under extraordinary market conditions.
(c) For purposes of this rule:
(1) "Forex" has the same meaning as in Bylaw 1507(b); and
(2) "Forex Dealer Member" has the same meaning as in Bylaw 306.
(d) In addition to cash, a Forex Dealer Member may accept those instruments described in CFTC Rule 1.25 as collateral for customers' security deposit obligations. The collateral must be in the FDM's possession and control and is subject to the haircuts in CFTC Rule 1.17.
(e) An FDM is required to collect additional security deposits from a retail forex customer, or liquidate the retail forex customer’s positions, if the amount of the retail forex customer’s security deposits maintained with the FDM is not sufficient to meet the requirements of this section.
(f) An FDM is required to immediately notify NFA's Compliance Department if the FDM changes the security deposit amount established by either subsection (a) or (b) above provided, however, that any decrease cannot fall below the highest minimum security deposit amount required by either subsection (a) or (b) as applicable to a particular currency.
(g) An FDM is prohibited from acting as a counterparty to an eligible contract participant acting as a dealer (as that term is defined in Financial Requirements Section 11(e)) unless that dealer collects and maintains from its customers and eligible contract participant counterparties security deposit amounts for forex equal or greater to the amounts required in subsection(s) (a) and (b).