PRIA Logo™
Title 15, Commerce and TradeRelease 119-110

§8306 Determining Status of Novel Derivative Products

Title 15 › CHAPTER 109 — WALL STREET TRANSPARENCY AND ACCOUNTABILITY › SUBCHAPTER I — REGULATION OF OVER-THE-COUNTER SWAPS MARKETS › Part A — Regulatory Authority › § 8306

Last updated Sep 22, 2026|Official source

Summary

When a person files to list or trade a new derivative that might be both a security and a commodity futures contract (or an option), they can give a copy of that filing to both the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) at the same time and tell both agencies they did so. If they don’t, then whichever agency first decides the product might have both elements must tell the other agency and send a copy within 5 business days. Either agency may, within 21 days after getting that notice or on its own, ask the other agency in writing to decide whether the product is a security or is a commodity futures contract/option. That written request can be withdrawn any time before a decision. The agency asked must issue a written order with its decision and reasons within 120 days. Either agency may also ask the other for an exemption instead of a determination; the SEC’s decision not to grant such an exemption is not reviewable under section 78y of this title. If one agency disagrees with the other’s final order, it can ask the U.S. Court of Appeals for the D.C. Circuit to review the order within 60 days. The petition must be sent to the other agency within 1 business day, and the other agency must give the court the order and related documents. The court must speed up the case, give no special weight to either agency’s view, and the filing of the petition pauses the order until the court’s decision (including any appeal) is final.

Full Legal Text

Title 15, §8306

Commerce and Trade, Source: USLM XML via OLRC

(a)Process for determining the status of a novel derivative product
(1)Notice
(A)In general
Any person filing a proposal to list or trade a novel derivative product that may have elements of both securities and contracts of sale of a commodity for future delivery (or options on such contracts or options on commodities) may concurrently provide notice and furnish a copy of such filing with the Securities and Exchange Commission and the Commodity Futures Trading Commission. Any such notice shall state that notice has been made with both Commissions.
(B)Notification
If no concurrent notice is made pursuant to subparagraph (A), within 5 business days after determining that a proposal that seeks to list or trade a novel derivative product may have elements of both securities and contracts of sale of a commodity for future delivery (or options on such contracts or options on commodities), the Securities and Exchange Commission or the Commodity Futures Trading Commission, as applicable, shall notify the other Commission and provide a copy of such filing to the other Commission.
(2)Request for determination
(A)In general
No later than 21 days after receipt of a notice under paragraph (1), or upon its own initiative if no such notice is received, the Commodity Futures Trading Commission may request that the Securities and Exchange Commission issue a determination as to whether a product is a security, as defined in section 78c(a)(10) of this title.
(B)Request
No later than 21 days after receipt of a notice under paragraph (1), or upon its own initiative if no such notice is received, the Securities and Exchange Commission may request that the Commodity Futures Trading Commission issue a determination as to whether a product is a contract of sale of a commodity for future delivery, an option on such a contract, or an option on a commodity subject to the Commodity Futures Trading Commission’s exclusive jurisdiction under section 2(a)(1)(A) of title 7.
(C)Requirement relating to request
A request under subparagraph (A) or (B) shall be made by submitting such request, in writing, to the Securities and Exchange Commission or the Commodity Futures Trading Commission, as applicable.
(D)Effect
Nothing in this paragraph shall be construed to prevent—
(i)the Commodity Futures Trading Commission from requesting that the Securities and Exchange Commission grant an exemption pursuant to section 78mm(a)(1) of this title with respect to a product that is the subject of a filing under paragraph (1); or
(ii)the Securities and Exchange Commission from requesting that the Commodity Futures Trading Commission grant an exemption pursuant to section 6(c)(1) of title 7 with respect to a product that is the subject of a filing under paragraph (1),
Provided, however, that nothing in this subparagraph shall be construed to require the Commodity Futures Trading Commission or the Securities and Exchange Commission to issue an exemption requested pursuant to this subparagraph; provided further, That an order granting or denying an exemption described in this subparagraph and issued under paragraph (3)(B) shall not be subject to judicial review pursuant to subsection (b).
(E)Withdrawal of request
A request under subparagraph (A) or (B) may be withdrawn by the Commission making the request at any time prior to a determination being made pursuant to paragraph (3) for any reason by providing written notice to the head of the other Commission.
(3)Determination
Notwithstanding any other provision of law, no later than 120 days after the date of receipt of a request—
(A)under subparagraph (A) or (B) of paragraph (2), unless such request has been withdrawn pursuant to paragraph (2)(E), the Securities and Exchange Commission or the Commodity Futures Trading Commission, as applicable, shall, by order, issue the determination requested in subparagraph (A) or (B) of paragraph (2), as applicable, and the reasons therefor; or
(B)under paragraph (2)(D), unless such request has been withdrawn, the Securities and Exchange Commission or the Commodity Futures Trading Commission, as applicable, shall grant an exemption or provide reasons for not granting such exemption, provided that any decision by the Securities and Exchange Commission not to grant such exemption shall not be reviewable under section 78y of this title.
(b)Judicial resolution
(1)In general
The Commodity Futures Trading Commission or the Securities and Exchange Commission may petition the United States Court of Appeals for the District of Columbia Circuit for review of a final order of the other Commission issued pursuant to subsection (a)(3)(A), with respect to a novel derivative product that may have elements of both securities and contracts of sale of a commodity for future delivery (or options on such contracts or options on commodities) that it believes affects its statutory jurisdiction within 60 days after the date of entry of such order, a written petition requesting a review of the order. Any such proceeding shall be expedited by the Court of Appeals.
(2)Transmittal of petition and record
A copy of a petition described in paragraph (1) shall be transmitted not later than 1 business day after filing by the complaining Commission to the responding Commission. On receipt of the petition, the responding Commission shall file with the court a copy of the order under review and any documents referred to therein, and any other materials prescribed by the court.
(3)Standard of review
The court, in considering a petition filed pursuant to paragraph (1), shall give no deference to, or presumption in favor of, the views of either Commission.
(4)Judicial stay
The filing of a petition by the complaining Commission pursuant to paragraph (1) shall operate as a stay of the order, until the date on which the determination of the court is final (including any appeal of the determination).

Legislative History

Notes & Related Subsidiaries

Statutory Notes and Related Subsidiaries

Definition For definition of “including” as used in this section, see section 5301 of Title 12, Banks and Banking.

Reference

Citations & Metadata

Citation

15 U.S.C. § 8306

Title 15, Commerce and Trade

Last Updated

Sep 22, 2026

Release point: 119-110