CFTC Charitable Organization Exemption Act of 2025
Sponsored By: Representative Rep. McClain Delaney, April [D-MD-6]
Introduced
Summary
Exempts certain charitable organizations from Commodity Trading Advisor and Commodity Pool Operator registration when they meet specified conditions. The bill creates five specific exception paths that let charities, small advisers, and some SEC-registered advisers give commodity advice or run commodity pools while keeping disclosure and enforcement safeguards.
Show full summary
- Charitable organizations and their officers or volunteers can provide advisory services or operate pools only for the charity itself or for investment trusts that are excluded from the Investment Company Act. These exempt charities must make disclosures in line with section 7(e) of the Investment Company Act of 1940.
- Small commodity trading advisors who advised no more than 15 people in the prior 12 months and who do not hold themselves out publicly as CTAs are not required to register as CTAs. This lowers regulatory obligations for very small advisers.
- Advisers already registered with the Securities and Exchange Commission are exempt if their business is not primarily acting as CTAs and they do not advise pools mainly engaged in trading commodity interests. The bill defines commodity interests to include futures, options, swaps, foreign exchange, and related contracts.
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Bill Overview
Analyzed Economic Effects
3 provisions identified: 1 benefits, 1 costs, 1 mixed.
Securities duties for commodity pools
If enacted, the bill would clarify that nothing in it would relieve any person of obligations or affect remedies under the Securities Act of 1933 or the Securities Exchange Act of 1934 for issuance, offer, purchase, sale, or reporting related to securities of a commodity pool. This clarification would take effect on enactment and would preserve existing investor protections and enforcement avenues.
Ban on unregistered adviser communications
If enacted, the bill would make it unlawful for any commodity trading advisor (CTA) or commodity pool operator (CPO) that is not registered to use the mail or any instrumentality of interstate commerce in connection with that person's CTA/CPO business. This rule would take effect on enactment and would raise compliance and market-access costs for unregistered advisers and operators.
Exemptions for charities and small advisers
If enacted, the bill would create several exemptions to the ban on unregistered CTAs and CPOs. Charitable organizations (and their trustees, directors, officers, employees, and volunteers acting within duties) would be exempt when advisory or pool activities are conducted only for those excluded charitable trusts or similar excluded entities. The bill would also exempt: dealers, processors, brokers, or sellers whose commodity trading advice is solely incidental to certain cash-market transactions; nonprofit voluntary membership general farm organizations; SEC-registered investment advisers whose business is not primarily acting as a CTA and who do not advise pools mainly trading commodity interests; and small CTAs who gave advice to 15 or fewer persons in the prior 12 months and do not hold themselves out generally as CTAs. CTAs or CPOs relying on the charitable exemption would have to give written disclosures that follow section 7(e) of the Investment Company Act, and persons using these exemptions would remain subject to proceedings under section 14.
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Sponsors & CoSponsors
Sponsor
Rep. McClain Delaney, April [D-MD-6]
MD • D
Cosponsors
Messmer
IN • R
Sponsored 12/11/2025
Roll Call Votes
No roll call votes available for this bill.
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