§7b–1 Designation of Securities Exchanges and Associations as Contract Markets

Summary

A board of trade that is registered with the Securities and Exchange Commission as a national securities exchange, a national securities association registered under 15 U.S.C. 78o–3(a), or an alternative trading system can be named a designated contract market for security futures products if three things are met: it lists or trades only security futures and no other futures contracts; it files a written notice with the Commission in the form and with the information the Commission requires; and its registration with the SEC is not suspended. If it is designated, that exchange, association, or ATS is exempt from certain parts of the Commodity Exchange Act (subsections (c), (e), and (g) of section 6c; section 6j; section 7; section 7a–2; section 10a; section 12(d); section 13(f); and section 20). A designated ATS must join a futures association registered under section 21. The ATS does not have to make rules about subscriber conduct beyond trading on the ATS or punish subscribers except by blocking their trading; the registered futures association must set those conduct rules and handle discipline. The Commission may also grant other exemptions by rule or order if that is in the public interest and protects investors, and it will set the procedures for such exemptions. Being designated does not make an ATS an exchange for any purpose.