معامالت صرف العمالت األجنبية) التنظيم ن (المحتوى المحسن - أدوات الوثائق تم تصميم هذه األدوات لمساعدتك على فهم الوثيقة الرسمية بشكل أفضل والمساعدة في مقارنة النسخة اإللكترونية من النسخة المطبوعة. تسمح عناصر الترميز هذه للمستخدم بمعرفة كيف يتبع المستند كتيب صياغة المستند الذي تستخدمه الوكالات لإنشاء مستنداتها. ويمكن أن تكون هذه المعلومات مفيدة لفهم كيفية تنظيم الوثيقة بشكل أفضل ولكنها ليست جزءا من الوثيقة المنشورة نفسها. المحتوى المحسن - أدوات الوثائق المحتوى المحسن - أدوات المطورين يعتمد مجلس محافظي نظام الاحتياطي الفدرالي (لدكوبواردردكو) قاعدة نهائية للسماح للمنظمات المصرفية تحت إشرافها بالدخول في معاملات غير تبادلية بالعملة الأجنبية التي تبدأ ببيعها بالتجزئة الزبائن. وتصف القاعدة النهائية أيضا مختلف المتطلبات التي يتعين على المنظمات المصرفية أن تمتثل لها لإجراء مثل هذه المعاملات. هذه القاعدة سارية المفعول في 13 مايو 2013. بدء مزيد من المعلومات لمزيد من المعلومات الاتصال: سكوت هولز، مستشار أول، قسم الشؤون القانونية، (202) 452-2966. نهاية معلومات إضافية نهاية التمهيد التمهيد معلومات إضافية معلومات إضافية: I. الخلفية في 21 يوليو 2010، وقع الرئيس أوباما في قانون دود فرانك إصلاح وول ستريت وقانون حماية المستهلك لعام 2010 (قانون دود فرانك). (1) بصيغته المعدلة بموجب المادة 742 (ج) (2) من قانون دود - فرانك (2)، ينص قانون تبادل السلع (سي) على أنه لا يجوز للمؤسسة المالية للولايات المتحدة 3 التي توجد فيها وكالة تنظيمية اتحادية (4) عرض أنواع معينة من معاملات الصرف الأجنبي الموصوفة في القسم 2 (ج) (2) (ب) '1' (I) من سي مع عميل التجزئة 5 باستثناء وفقا لقاعدة أو لائحة وكالة تنظيمية اتحادية والسماح للمعاملة بموجب هذه الشروط والأحكام التي تحددها الهيئة التنظيمية الاتحادية (6) (فوركسوريتا فوريكس روليردكو). ويشمل البند 2 (ج) (2) (ب) '1' (1) اتفاق لدكوان أو عقده أو معاملته بالعملة الأجنبية وهو عقد بيع سلعة للتسليم في المستقبل (أو خيار على هذا العقد) أو (باستثناء خيار يتم تنفيذه أو تداوله في بورصة الأوراق المالية الوطنية المسجلة بموجب المادة 6 (أ) من قانون سوق الأوراق المالية لعام 1934 (15 أوسك 78 f (a)). التعامل مع جميع العقود الآجلة والخيارات وجميع الاتفاقيات أو العقود أو المعاملات المشابهة وظيفيا أو اقتصاديا لتلك العقود الآجلة والخيارات على نحو مماثل 8 يجب أن تحدد قواعد الفوركس الخاصة بالتجارة متطلبات مناسبة فيما يتعلق بالإفصاح وحفظ السجلات ورأس المال والهامش والإبلاغ وسلوك الأعمال ، ومتطلبات التوثيق، ويمكن أن تشمل المعايير أو المتطلبات الأخرى التي تحددها الوكالة التنظيمية الاتحادية (9). وتنطبق قاعدة المجلس على مؤسسات لدكوبانكينغ، رديقو مصطلح محدد في الطائفة (ب) تعني المصارف الأعضاء في الدولة، وفروع المصارف الأجنبية غير المرخص لها من قبل الدولة، والشركات القابضة المالية، والشركات القابضة في البنوك، وشركات الادخار والقروض، و 10 شركات اتفاق، وشركات إدج أكت. في 10 سبتمبر 2010، اعتمدت لجنة تداول العقود الآجلة للسلع الأساسية (فكتك) قاعدة تداول العملات الأجنبية للأفراد الذين يخضعون لولايتها. 11 بعد دراسة ودراسة قاعدة فكس التجزئة كفتس، والتشاور مع مكتب المراقب المالي للعملة (أوك) والمؤسسة الاتحادية للتأمين على الودائع (فديك)، وافق المجلس للنشر إخطارا من وضع قواعد المقترحة (نير) للتجزئة (فوركس) التي قامت بها المؤسسات المصرفية في 28 يوليو / تموز 2011. وتم نشر التقرير في السجل الاتحادي في 3 أغسطس 2011 (12)، واختتمت فترة التعليق في 11 أكتوبر / تشرين الأول 2011. وردا على التقرير، تلقى المجلس ستة تعليقات: وثلاثة من الأفراد، وواحد من مصرف، واثنان من رابطات تجارية. ولم يعالج أحد المعلقين الأفراد القاعدة، في حين أعرب معلق آخر عن تأييده العام للقاعدة. أما الشخص الثالث (من الآن فصاعدا لدكوث كومنتيردكو الفردية) والبنك (المشار إليه فيما بعد بدكوث بانك كومنتيردكو) أيد عموما القاعدة بينما طلب بعض التوضيحات والتغييرات. وطلبت إحدى الاتحادات التجاریة تغییرات لتخفیف العبء علی بعض الکیانات التي من شأنھا أن تکون مؤھلة لزبائن النقد الأجنبي لدكورايتيلكو بموجب اللائحة المقترحة. وطلبت رسالة جمعية التجارة الأخرى إدخال تغييرات على عملاء التجزئة الذين يستخدمون النقد الأجنبي فيما يتعلق بشراء أو بيع ضمان مقوم بعملة أجنبية. وترد هذه التعليقات في تحليل كل قسم على حدة أدناه. ويعتمد المجلس قاعدة نهائية مماثلة إلى حد كبير للقاعدة المقترحة، مع بعض التوضيحات على النحو المبين أدناه. II. قسم التحليل حسب القسم 240.1 الهدف والهدف والنطاق يخول هذا القسم مؤسسة مصرفية لإجراء معاملات الفوركس بالتجزئة. ويغطي نطاق اللائحة فروع ومكاتب المؤسسات المصرفية، على الرغم من أن الفروع والمكاتب الأجنبية لهذه المؤسسات لا تخضع للأقسام 240-3 و 240-5 إلى 240-16 ما لم يكن الفرع أو المكتب يتعامل مع عميل من الولايات المتحدة. وبما أن المادتين 240-1 و 240-2 تغطيان سلطة التنظيم والغرض منه ونطاقهما والتعاريف المستخدمة في اللائحة، فإذا كانت المؤسسات المصرفية تقوم بمعاملات الصرف الأجنبي بالتجزئة فقط التي يقوم بها فرع أو مكتب أجنبي وتقتصر على العملاء غير الأمريكيين، فإن المنفذ الوحيد القسم من اللائحة التي ستطبق سيكون القسم 240.4. كما هو مبين أدناه، يتطلب هذا القسم مؤسسة مصرفية ترغب في الدخول في صفقات الفوركس بالتجزئة لإخطار مجلس الإدارة قبل البدء في تجارة الفوركس بالتجزئة. كما تغطي اللائحة الشركات التابعة للمؤسسات المصرفية التي يتم تنظيمها بموجب قوانين الولايات المتحدة أو الولايات المتحدة، إلا إذا كانت الشركة التابعة خاضعة لولاية هيئة تنظيمية اتحادية أخرى مرخص لها بتصنيف قواعد العملات الأجنبية بالتجزئة بموجب القسم 2 (ج) (2) (هاء) من قانون بورصة السلع. 13 لا يتم تغطية الشركات التابعة لمؤسسة مصرفية منظمة بموجب القانون الأجنبي بغض النظر عن جنسية العميل. تسري القاعدة على معاملات الفوركس بالتجزئة التي تقوم بها المؤسسات المصرفية في تاريخ السريان أو بعده. القسم 240.2mdashDefinitions يحدد هذا القسم المصطلحات الخاصة بمعاملات الفوركس بالتجزئة والمتطلبات التنظيمية التي تنطبق على معاملات الفوركس بالتجزئة. يتضمن تعريف لكوريتايل فوريكس ترانزاكتيونردكو عموما المعاملات التالية بالعملة الأجنبية بين مؤسسة مصرفية وشخص غير مؤهل بدء مطبوعة صفحة 21021 مشارك في العقد: ثينسب 14 (ط) مستقبل أو خيار على هذا المستقبل 15 (إي) الخيارات التي لم يتم تداولها في سوق الأوراق المالية الوطنية المسجلة 16 و (3) بعض المعاملات المالية أو ذات الهامش. هذا التعريف له العديد من السمات الهامة. أولا، بعض المعاملات بالعملة الأجنبية ليست معاملات فوركسا فوريكس، رديقو وبالتالي فهي لا تخضع للحظر الوارد في المادة 742 (ج) (2) من قانون دود-فرانك. على سبيل المثال، معاملة فوركس لدكوسبوتردكو حيث يتم شراء عملة واحدة لآخر ويتم تبادل عملتين في غضون يومين ليس لدكوفوتورردكو ولن تلبي تعريف الصفقة الفوركس لدكوريتايل، رديقو منذ التسليم الفعلي يحدث في أقرب وقت ممكن عمليا. 17 وبالمثل، لا تشمل المعاملات الفوركسية لفوركيتايل عقدا آجلا مع كيان تجاري ينشئ التزاما قابلا للإنفاذ لإجراء التسليم أو تسليمه شريطة أن يكون لدى الطرف المقابل التجاري القدرة على تقديم التسليم وقبول التسليم فيما يتصل بخط أعماله. 18 بالإضافة إلى ذلك، لا يشمل لكوريتايل فوريكس ترانزاكتيوندركو برودوكتيردكو المصرفية لدكويدنتيفيد أو جزء من المنتجات المصرفية لدكويدنتيفيد، رديقو كما هو محدد في القسم 401 (ب) من قانون اليقين القانوني لقانون المنتج من عام 2000. 19 وأخيرا، لا تعريف وتشمل المعاملات المنفذة في بورصة الأوراق المالية والمؤسسات المصرفية غير مؤهلة لتنفيذ معاملات الفوركس بالتجزئة في سوق العقود المعينة. ثانيا، تعريف لكوريتايل فوريكس تراديتيونردكو يغطي المتداول الفوركس المعاملات الفوركس المقدمة أو دخلت على أساس الاستدانة أو الهامش (ما يسمى زيلينر ثينسب 20 عقود)، بما في ذلك على سبيل المثال لا الحصر هذه المعاملات المتداولة على شبكة الإنترنت، من خلال الهاتف المحمول، أو على منصة إلكترونية. وعادة ما تتطلب معاملة الفوركس الفوري المتداول تسليم العملة خلال يومين، مثل المعاملات الفورية. ومع ذلك، من الناحية العملية، يتم تجديد هذه العقود إلى أجل غير مسمى كل يوم، ولا يتم تسليم أي عملة فعليا حتى يغلق أحد الطرفين الموقف بشكل مؤكد. 21 ولذلك، فإن العقود هي أشبه من الناحية الاقتصادية بعقود العقود الآجلة، على الرغم من أن بعض المحاكم قد احتفظت بها لتكون عقود فورية في شكلها. (22) قدمت رابطة المصرفيين الأمريكيين وشعبة النقد الأجنبي العالمية التابعة لرابطة الأسواق المالية العالمية (من الآن فصاعدا كلمة "أباغفما ليتراردكو") رسالة من رسائل تعليق الجمعيات التجارية. وطلبت رسالة التعليق توضيحا أو تخفيفا من شأنه أن يسفر عن استثناء بعض معاملات الفوركس من جانب عملاء التجزئة، الذي يستهدف فقط إكمال معاملة في أوراق مالية أجنبية. وقد وجهت رسالة التعليق هذه إلى جميع الهيئات التنظيمية الفدرالية التي أصدرت أو اقترحت قواعد تداول العملات الأجنبية بالتجزئة: مجلس الإدارة، و كفتك، و فديك، و أوك، ولجنة الأوراق المالية والبورصات. وفي 18 يوليو / تموز 2012، أصدرت لجنة التجارة الحرة (كفتك) قاعدة نهائية تضمنت تفسيرات تتعلق بالمعاملات الفورية للنقد الأجنبي التي استجابت لخطاب أباجفما. على وجه التحديد، حددت كفتك معاملة الفوركس الفوري للنوايا الحسنة لتشمل شراء أو بيع مبلغ من العملة الأجنبية يساوي سعر الضمان الأجنبي حيث (1) يتم تنفيذ المعاملات الأمنية وما يتصل بها من العملات الأجنبية في وقت واحد من أجل تنفيذ التسليم حسب الموعد النهائي لتسوية األوراق المالية ذات الصلة، و) 2 (حدوث التسليم الفعلي للعملة األجنبية في مثل هذا الموعد النهائي. من خلال تفسير سي لاستبعاد هذه الأنواع من معاملات الفوركس بالتجزئة التي أجريت فيما يتعلق بشراء الأوراق المالية والمبيعات، وأكدت كفتك أن المعاملات لا تخضع لأحكام سي التي يشار إليها في القسم 742 من قانون دود فرانك. ويرى المجلس أنه لا يلزم إدخال أي تعديل على القاعدة النهائية لمعالجة هذه المسألة. كما أضاف المجلس قسما إلى القاعدة النهائية لتوضيح أنه يجوز للمجلس أن يعدل أحكام هذه القاعدة فيما يتعلق بمعاملة نقدية محددة في سوق الفوركس بالتجزئة أو فئة من معاملات الفوركس بالتجزئة إذا قرر المجلس أن التعديل يتسق مع السلامة والسلامة حماية عملاء الفوركس بالتجزئة. ويحدد القسم 240.2 العديد من المصطلحات بالرجوع إلى سي، بما في ذلك المشاركين في العقد المؤهلين (إكب). ال تعتبر المعامالت بالعمالت األجنبية مع المشاركين في العقد المؤهلين معامالت صرف العمالت األجنبية، وبالتالي فهي غير خاضعة لهذه القاعدة. ويغطي التعريف مجموعة متنوعة من الكيانات المالية والكيانات الحكومية وبعض الأعمال التجارية والأفراد الذين يستوفون عتبات استثمار معينة. (23) رسالة التعليق التي قدمتها شعبة الأسواق العالمية العالمية لرابطات الأسواق المالية (والمشار إليها فيما يلي باسم "غفما ليتراردكو") والمعلق من البنك ذكروا اعتقادهم بأن تعريف المشاركين في العقد لدكوويليكو ضيق جدا ولا لزوم له أن يطلب من المؤسسات المصرفية توفير حماية التجزئة للعملاء المتطورين فشلت في التأهل باعتبارها إكب لأنها لا تلبي عتبة الأصول 10 مليون في التعريف القانوني. وأوضح معلق جمعية التجارة ومعلق البنك أن تعريف لكوريتايل فوريكس كوستوميردكو في القسم 240.2 (ن) تقصي المؤسسات غير إكب ممثلة من قبل مستشارين الاستثمار المسجلين. كما سعى معلق الرابطة التجارية إلى تخفيض العبء على مجموعة السلع الأساسية التي لا تستطيع إثبات أن جميع المشاركين فيها هم أنفسهم إكبس. كما أشارت رسالة غفما إلى أنه إذا لم يعفي المجلس هذه الكيانات من جميع جوانب هذه اللائحة، يجب على المجلس أن يسمح بحد أدنى بما يدعوه إلى عدم إكبرسكو إلى (1) تعطيل شروط الإفصاح، بما في ذلك الحسابات المربحة النسبة الموصوفة في القسم 240.6 (ه)، (2) انخفاض الهامش بالمقارنة مع عملاء التجزئة، و (3) استيعاب المرونة في تنفيذ المعاملات لا يجوز البدء في طباعة الصفحة 21022 بموجب اللائحة المقترحة. ولا یعتمد المجلس الاقتراح القائل بعدم معاملة أي من موظفي برنامج التعاون الاقتصادي كبرنامج إيكب استنادا إلى استخدامه لمستشار استثمار إذ یعتقد أن القسم 2 (ج) (2) (ھاء) من اتفاقیة أوروبا الوسطى یتطلب تطبیق قواعد تجارة الفوركس بالتجزئة على المعاملات مع غير إكبس. وعلى الرغم من أن المستشارين الاستثماريين الكبار قد يختارون تجنب التعامل مع مستثمرين غير متطورين، فإن المجلس لا يعتقد أن إشراك مستشار كبير للاستثمار هو بديل عن حماية التجزئة التي يسعى إليها الكونغرس في سن القسم 2 (ج) (2) (هاء) من سي. وقد أدرجت المسألة المتعلقة بوضع مجموعات السلع الأساسية التي تشارك في معاملات صرف العملات الأجنبية في برنامج مراقبة التجارة الدولية في إعلان قواعد السلوك المقترحة بشأن زيادة تعريف بعض أحكام قانون دود - فرانك، بما في ذلك مشاركة المتعاقدين غير المؤهلين، ورديكوثينسب 24 ومعالجتها في قاعدتها النهائية المعتمدة في 6 أبريل / نيسان ، 2012. 25 إن تعريف كفتس ل إكب يقلل العبء على مجموعات السلع التي تسعى إلى إثبات أن جميع أعضائها هم أنفسهم إكبس. ويقوم المجلس بتعديل تعريف التصنيف المركزي للمنتجات في القسم 240-2 من اللائحة لإدراج التعريف المنقح لاتفاقية التجارة الإلكترونية. وسيسمح ذلك للمؤسسات المصرفية باستخدام نفس المعيار بالنسبة لحالة إكب كمتعاملين في تجارة الفوركس بالتجزئة الخاضعة لسلطة كفتك عند التعامل مع برك السلع. وتماشيا مع أحكام القاعدة النهائية ل سي و كفس، فإن المجلس لا يعتمد اقتراح المعلقين بأن تعفى مجموعات السلع الأساسية من الشرط القانوني المتمثل في إثبات أن أعضائها هم أنفسهم إكب. كما سعت رسالة غفما إلى توضيح أن مؤسسة مصرفية ذات عميل في سوق الفوركس بالتجزئة والتي تصبح لاحقا شركة إكب قد تستمر في التعامل مع العميل كعميل للتداول في سوق الفوركس (على سبيل المثال غير إكب). ويعتقد المجلس أن المؤسسة المصرفية قد تستمر في االمتثال للوائح هذا العميل. في الواقع، يجوز للمؤسسة المصرفية تطبيق أحكام اللائحة ن على المعاملات مع أي عميل، على الرغم من أنه مطلوب فقط لتطبيق اللائحة على معاملات الفوركس بالتجزئة مع عملاء الفوركس بالتجزئة. ولم يتلق المجلس أي تعليقات على التعاريف المقترحة بخلاف المشاركين في العقد غير المؤهلين. ردفو بالإضافة إلى تعديل تعريف إكب، يقوم المجلس بإضافة تعريف ل لدوسوفينغز وشركة القرض القابضة. ردكو من جميع النواحي الأخرى، يتم اعتماد هذا القسم إلى حد كبير كما هو مقترح. القسم 240.3mdash المعاملات المحظورة يمنع هذا القسم المؤسسات المصرفية والأشخاص المرتبطين بها من الانخراط في سلوك احتيالي فيما يتعلق بمعاملات الفوركس بالتجزئة. يتناول هذا القسم أيضا تضارب المصالح المحتمل من خلال حظر مؤسسة مصرفية من التصرف كطرف مقابل في معاملة الفوركس بالتجزئة إذا كانت المؤسسة المصرفية أو الشركة التابعة لها تمارس السلطة التقديرية على حساب العملاء في الفوركس بالتجزئة. واستخدم اقتراح المجلس صياغات مختلفة نوعا ما عن الصياغة التي تستخدمها لجنة مكافحة الإرهاب، ولجنة التنسيق الإدارية، والمؤسسة. في حين أن قواعد الفوركس التجزئة للسلطات التنظيمية الاتحادية الأخرى تنص على أن الطرف المقابل النقد الاجنبى التجزئة قد لا لدكوشات أو الاحتيال أو محاولة لغش أو ديفرودوقو أي شخص، اقترح المجلس استخدام عبارة لدكوديفروف أو محاولة ل defraud. rdquo المعلق الفردية الموصى بها باستخدام لدكوشيت أو ديفروردكو بدلا من لدكوديفرود، رديقو الذي يعتقد أنه من شأنه أن يعزز الاتساق التنظيمي عبر المنظمين. ويلاحظ المجلس أن العبارة "لدكوشيت" أو "ديفروردكو" تستخدم في القسم 6 (ب) من "سي" (لدكوكونتراكتس المصممة للاحتيال أو التضليل) ثينسب 26 وتعديل مقترحها لاستخدام نفس لغة سي وغيرها من المنظمين. وبالإضافة إلى ذلك، فإن اقتراح المجلس يحظر مؤسسة مصرفية من لدكونوكينغليردكو تقديم تقرير كاذب أو خداع شخص، في حين أن المنظمين الآخرين تحظر تجار الفوركس التجزئة من لدكويلفلدركو الانخراط في هذه الأنشطة. وأعرب المجلس عن اعتقاده بأن لدكونونينغليردكو يضع معيارا أكثر ملاءمة من الإثبات. وفضل المعلق الفردي اللغة المستخدمة من قبل الهيئات التنظيمية الأخرى، وذلك جزئيا لتحسين الاتساق التنظيمي. وزارة العدل (دوجس) الولايات المتحدة دليل المحامين يناقش الفرق بين لدكونوينلغيردكو و لدويلفلدركو فيما يتعلق 18 U. S.C. 1001. القوانين الجنائية الاتحادية أحكام عامة لمكافحة الغش. وتتفق هذه المناقشة مع قضية المحكمة العليا بشأن حكم آخر من أحكام القانون الجنائي. (28) تشير كل من وزارة العدل والمحكمة إلى أن مخالفة لدكوويلفردكو تتطلب دليلا على أن المدعى عليه تصرف بمعرفة أن سلوكه كان غير مشروع، في حين أن مخالفة لدكوكنينغردكو تتطلب معرفة الحقائق التي تشكل الجريمة، باعتبارها متميزة عن معرفة القانون. ويعتقد المجلس أن لدكونوكينغليردكو يضع المعيار الأنسب، لأنها سوف تغطي تقديم تقرير كاذب أو سلوك خادع دون الحاجة إلى دليل على أن المؤسسة المصرفية تعلم أنه ينتهك اللائحة ن. القسم 240.4mdashNotification يتطلب هذا القسم من مؤسسة مصرفية إخطار المجلس قبل الانخراط في تجارة الفوركس بالتجزئة. يتضمن هذا الإشعار معلومات عن العناية الواجبة من العملاء (بما في ذلك تقييمات الائتمان ومدى ملاءمة العملاء و لدكوكونو يور كوستوميردكو الوثائق) موافقات المنتجات الجديدة حلاقة الشعر ل نوناشاش هامش وتضارب المصالح. وبالإضافة إلى ذلك، يجب على المؤسسة المصرفية أن تشهد أن لديها سياسات مكتوبة وإجراءات وقياسات ونظم إدارة المخاطر والضوابط اللازمة للانخراط في تجارة الفوركس بالتجزئة بطريقة آمنة وسليمة وبما يتفق مع متطلبات قاعدة الفوركس التجزئة المجلس . وبمجرد قيام المؤسسة المصرفية بإخطار المجلس بموجب هذا الحكم، سيكون أمام المجلس ستون يوما للحصول على معلومات إضافية أو الاعتراض على الإخطار خطيا، أو يعتبر الإخطار فعالا. وإذا طلب المجلس معلومات إضافية، يصبح الإشعار ساري المفعول بعد ستين يوما من استلام جميع المعلومات المطلوبة من المجلس، ما لم يعترض المجلس كتابة. على الرغم من أن المتطلبات القانونية فيما يتعلق بالعقود الآجلة وعقود الخيارات هي في الوقت الحالي سارية المفعول، قد تشارك بعض المؤسسات المصرفية حاليا في معاملات الفوركس بالتجزئة التي سيتم تغطيتها من قبل هذه القاعدة، مثل ما يسمى عقود لدكوزلينر. ردكو المؤسسات المصرفية العاملة في تجارة الفوركس بالتجزئة فإن المعامالت اعتبارا من تاريخ سريان هذه القاعدة التي تبلغ مجلس اإلدارة على وجه السرعة سوف يكون لها ستة أشهر أو فترة أطول يقدمها المجلس لجعل عملياتها متوافقة مع القاعدة. وبموجب هذه القاعدة، فإن المؤسسة المصرفية التي تبلغ مجلس الإدارة خلال 30 يوما من تاريخ سريان القاعدة النهائية لقيمة تداول العملات الأجنبية، رهنا بتمديد المجلس، وتقدم المعلومات التي يطلبها المجلس بعد ذلك، ستعتبر أنها تعمل في مجال البيع بالتجزئة عملا بقاعدة أو لائحة وكالة تنظيمية اتحادية، على النحو المطلوب بموجب قانون تبادل السلع الأساسية، عن تلك الفترة. 29 لا تحتاج المؤسسة المصرفية إلى الانضمام إلى منظمة آجلة للتنظيم الذاتي كشرط للقيام بأعمال تجارة الفوركس بالتجزئة. بداية الصفحة المطبوعة لم يتلق المجلس أي تعليقات على هذا القسم واعتمده كما هو مقترح. القسم 240.5mdash تطبيق وإغلاق من المقاصة مراكز طويلة وقصيرة يتطلب هذا القسم مؤسسة مصرفية لإغلاق المقاصة مراكز طويلة وقصيرة في نفس العملة في حساب الفوركس بالتجزئة. ومع ذلك، يجوز للمؤسسة المصرفية أن تعوض معاملات الفوركس بالتجزئة من قبل عميل الفوركس بالتجزئة أو وكيل العملاء (بخلاف المؤسسة المصرفية نفسها) وفقا لتعليمات محددة للعملاء. تعليمات البطانية ليست كافية لهذا الغرض، لأنها يمكن أن تلغي القاعدة العامة. ومع ذلك، لا يلزم إعطاء تعليمات تعويضات منفصلة لكل زوج من الأوامر من أجل أن تكون تعليمات ldquospecific. rdquo التي تنطبق على مجموعات محددة بما فيه الكفاية من المعاملات يمكن أن تكون محددة بما فيه الكفاية. يمكن تقديم تعليمات الإزاحة كتابة أو شفهيا. ويتعين على المؤسسة المصرفية أن تنشئ سجلا لكل تعليم من أشكال التعويضات وأن تحتفظ به. ولم يتلق المجلس أي تعليقات على هذا الفرع واعتمده كما هو مقترح. القسم 240.6mdash ديسكلوسور يتطلب هذا القسم من مؤسسة مصرفية تزويد عملاء الفوركس بالتجزئة ببيان الإفصاح عن المخاطر مماثل للبيان المطلوب من قبل قاعدة كفكس لتجزئة العملات الأجنبية، ولكن مصممة خصيصا لمعالجة بعض الخصائص الفريدة لفوركس بالتجزئة في المؤسسات المصرفية. ويصف بيان الإفصاح عن المخاطر المحدد المخاطر المرتبطة بمعاملات الفوركس بالتجزئة. ويوضح بيان الإفصاح أن المؤسسة المصرفية التي ترغب في استخدام حق المقاصة في تحصيل الهامش أو تغطية الخسائر الناشئة عن معاملات الفوركس بالتجزئة يجب أن تشمل هذا الحق في بيان الإفصاح عن المخاطر والحصول على إقرار خطي منفصل (انظر مناقشة المقاصة أدناه في القسم 240.9). وتتطلب القواعد النهائية ل كفتك و أوك و فديك من تجار التجزئة في الفوركس أن يكشفوا لعملاء التجزئة النسبة المئوية لحسابات الفوركس بالتجزئة التي حققت ربحا، ونسبة تلك الحسابات التي تعرضت لخسارة، خلال كل من آخر أربعة تقويم أرباع. (30) اقترح المعلق الفردي أنه يمكن التلاعب بهذه الحسابات الجديرة بالتنوع، رغم أنه لم يصف كيف يمكن القيام بذلك، وأوصى باعتماد منهجية حسابية موضوعية وموحدة لهذه النسبة. وأوصى المعلق أيضا بأن يتم حساب الحساب بمقدار الربح أو الخسارة لإظهار مقدار الربحية أو الخسارة، وليس فقط ما إذا كان أي حساب قد حقق أي ربح. ويعتقد مجلس اإلدارة أن حساب مبلغ الربحية من شأنه أن يجعل عملاء التجزئة يعتقدون أن األداء السابق هو مؤشر على النتائج المستقبلية ويحافظ على نسبة الحسابات المربحة وبيان الصفقات المربحة كما هو مقترح. وبالإضافة إلى ذلك، يعتقد المجلس أن حساب موحد للحسابات المربحة وبيان الصفقات المربحة لجميع تجار الفوركس بالتجزئة يوفر المزيد من حماية المستهلك التجزئة من خلال السماح للمقارنة عبر أنواع مختلفة من التجار. وأخيرا، يلاحظ المجلس أن الباب 240-7 (ب) يوفر منهجية حسابية لنسبة الحسابات المربحة الموحدة في الوكالات التنظيمية للبنك. 31 كما هو مقترح، يجب تقديم الكشف عن المخاطر كوثيقة منفصلة. وطلب المجلس التعلیق علی ما إذا کان ینبغي السماح للمؤسسات المصرفیة بالجمع بین الإفصاح عن مخاطر العملات الأجنبیة بالتجزئة مع الإفصاحات الأخرى التي تقدمھا المؤسسات المصرفیة لعملائھا. وأيد المعلق الفردي اقتراح المجلس الذي يتسق مع القواعد النهائية التي اعتمدتها الوكالات التنظيمية الأخرى في المصارف. وقد سعى المعلق الفردي إلى توضيح ما إذا كان الشرط الوارد في القسم 240.6 (و) بأن تفصح المؤسسة المصرفية عن الرسوم أو الرسوم أو العمولات المفروضة على العميل من أجل معاملات الفوركس بالتجزئة تشمل الفروقات. القواعد النهائية التي اعتمدتها أوك و فديك كلاهما يتطلب الكشف عن رسوم لدكواني، تهمة، ونشر، أو كوميسيونردكو وأوصت المعلق الفردية أن المجلس إضافة كلمة لدكوسبريادردكو لقواعدها. ويعتقد المجلس أن ينتشر تغطيتها اللغة المقترحة، ولكن هو إضافة كلمة لدكوسبرياسردكو إلى هذا القسم لجعل هذه التغطية صريحة. طلب المعلق الفردي أيضا التأكيد على أن الكشف عن رسوم لدكواني، أو تهمة، أو كوميسيونردكو يتضمن دخل الفائدة على حساب الفوركس بالتجزئة أو معاملة الفوركس بالتجزئة. ولا يكون معدل إيرادات الفائدة المدفوعة على الهامش النقدي رسما أو رسما أو انتشارا أو عمولة، ومن ثم لا يلزم الإفصاح عنها بموجب القسم 240-6. القسم 240.7mdash تسجيل السجلات يحدد هذا القسم الوثائق التي تسجل مؤسسة مصرفية تعمل في معاملات الفوركس بالتجزئة يجب أن تحتفظ بها لفحصها من قبل المجلس. ويتعين على المؤسسات المصرفية أن تحتفظ بسجلات حساب الفوركس بالتجزئة ودفاتر الأستاذ وسجلات المعاملات والسجلات اليومية وتذاكر الطلب والسجلات التي تبين المخصصات والهامش غير النقدي، فضلا عن السجلات المتعلقة بانتهاكات محتملة للقانون. ويحدد هذا القسم أيضا معايير صيانة الوثائق، بما في ذلك طريقة الصيانة وطولها. وأخيرا، يتطلب هذا القسم من المؤسسات المصرفية تسجيل سجلات المعاملات والحفاظ عليها وإتاحتها للعملاء. واقترح المعلق الفردي الاحتفاظ بالسجلات المطلوبة بموجب هذا القسم من قبل تاجر الفوركس بالتجزئة إلى الأبد، بدلا من الحد الأدنى لمدة خمس سنوات المحدد في القسم 240.7 (ح). ال يعتقد مجلس اإلدارة أنه من المناسب أن يتم االحتفاظ بالسجالت إلى أجل غير مسمى، ويلاحظ أن فترة السنوات الخمس تتسق مع متطلبات االحتفاظ بالعديد من سجالت اإلشراف والتنظيم التي يتطلبها المجلس. ويجري اعتماد هذا الفرع كما هو مقترح. متطلبات القسم 240.8mdashCapital لا تغير قاعدة تداول العملات الأجنبية في مجالس الإدارة لوائح المجلس بشأن رأس المال. ويتطلب هذا القسم عموما أن تكون المؤسسة المصرفية التي تقدم أو تدخل في معاملات الفوركس بالتجزئة مكتوبة بأحرف كبيرة كما هو محدد في لائحة المجلس H و Y و لثينسب 32 أو أن تحصل المؤسسة المصرفية على إعفاء من المجلس. يجب على فرع أو وكالة مرخصة من الدولة غير مرخص لها من قبل بنك أجنبي تطبيق قواعد رأس المال التي تسري عليها وفقا للبند 225.2 (r) (3) من لائحة المجلس Y. 33 يجب أن تتوافق شركة إدج أو شركة الاتفاق مع (أ) المبادئ التوجيهية لكفاية رأس المال التي تنطبق على شركة الحافة العاملة في القطاع المصرفي وفقا للبند 211.12 (ج) (2) من لائحة المجلس K. 34 وبالإضافة إلى ذلك، يجب على مؤسسة مصرفية الاستمرار في الاحتفاظ برأس المال مقابل معاملات الفوركس بالتجزئة على النحو المنصوص عليه في لوائح المجلس. ولم يتلق المجلس أي تعليقات على هذا الفرع واعتمده كما هو مقترح. القسم 240.9mdash متطلبات الهامش تتطلب الفقرة) أ (مؤسسة مصرفية تشارك في معامالت صرف العمالت األجنبية، قبل أي معاملة من هذا القبيل، أن تجمع من هامش العمالت األجنبية للعمالت األجنبية الذي يعادل ما ال يقل عن 2 في المائة من القيمة االسمية للبدء في صفحة 21024 إذا كانت الصفقة في زوج العملات الرئيسية، و 5 في المئة على الأقل من القيمة الاسمية للصفقة الفوركس التجزئة خلاف ذلك. إن متطلبات الهامش هذه مطابقة للمتطلبات التي تفرضها قواعد الفوركس الخاصة بتجارة التجزئة في كفتك، أوك، و فديك. زوج العملات الرئيسي هو زوج العملات بعملتين رئيسيتين. العملات الرئيسية المحددة في اللائحة هي الدولار الأمريكي (أوسد)، الدولار الكندي (كاد)، اليورو (ور)، الجنيه البريطاني (جبي)، الين الياباني، الفرنك السويسري (تشف)، الدولار النيوزلندي (نزد )، الدولار الأسترالي (أود)، كرونة سويدية، كرونر دنماركي، كرونة نرويجية (نوك)، 35 بالإضافة إلى أي عملة أخرى يحددها المجلس. قبل تنفيذ قاعدة كفتس، سمح المتعاملون غير المصرفيين بشكل روتيني للعملاء بالتداول بنسبة 1٪ (رافعة مالية 100: 1) وأحيانا مع هامش يصل إلى 0.25٪ (رافعة 400: 1). وعندما اقترحت لجنة التجارة الحرة في عام 2010 حكمها الخاص بتجارة العملات الأجنبية بالتجزئة، اقترحت شرط هامش بنسبة 10 في المائة (رافعة مالية قدرها 10: 1). وردا على التعليقات، خفضت كفتك الهامش المطلوب في القاعدة النهائية إلى 2 في المئة (الرافعة المالية 50: 1) للتداولات التي تنطوي على العملات الرئيسية و 5 في المئة (الرافعة المالية 20: 1) للتداولات التي تنطوي على العملات غير الرئيسية. كما تم اعتماد متطلبات الهامش هذه من قبل أوك و فديك. ولم يتلق مجلس اإلدارة أية تعليقات بشأن المستوى المناسب من الهامش، كما أنه يتبنى نفس المتطلبات التي تتبعها هيئة تنظيم األوراق المالية وغيرها من الهيئات التنظيمية للبنك. وتحدد الفقرة (ب) الأشكال المقبولة من الهامش التي يمكن للعملاء نشرها، بما في ذلك الهامش المتعهد به بما يتجاوز متطلبات الفقرة (أ). يجب على المؤسسات المصرفية أن تضع سياسات وإجراءات تنص على حلاقة الشعر للحواف غير النقدية التي يتم جمعها من العمالء، ويجب عليها مراجعة هذه القصص سنويا. قد يكون من الحكمة للمؤسسات المصرفية لمراجعة وتعديل حجم حلاقة الشعر بشكل أكثر تواترا. وتقتضي الفقرة (ج) من المؤسسة المصرفية أن تحصل على هامش إضافي من العميل أو لتصفية موقف العملاء إذا لم يستوف مبلغ الهامش الذي تحتفظ به المؤسسة المصرفية متطلبات الفقرة (أ). وتقتضي القاعدة المقترحة من المؤسسة المصرفية أن تضع علامة على المراكز المفتوحة لعملات الفوركس بالتجزئة وقيمة هامش العملاء إلى السوق يوميا لضمان ألا يتراكم عميل الفوركس بالتجزئة خسائر كبيرة لا يغطيها الهامش. تحظر لوائح الفوركس بالتجزئة المعتمدة من قبل أوك و فديك كلا المقاصة، أي. يحظر على تاجر النقد الأجنبي تطبيق خسارات عملاء الفوركس بالتجزئة مقابل أي أصل أو التزام من عملاء الفوركس بالتجزئة بخلاف المال أو الممتلكات المعطاة كهامش. وتتمتع البنوك عموما بحقوق واسعة في سداد الديون المتبادلة لتغطية التزامات العمالء. وليس من الواضح أن الحد من حق المصارف في المقاصة في هذه المعاملات المعينة من شأنه أن يوفر حوافز مناسبة لعملاء الفوركس بالتجزئة. ولم تتضمن القاعدة المقترحة من المجلس هذا الحظر ولم ترد أي تعليقات تعارض هذا الاقتراح. ويعتمد مجلس اإلدارة هذه األحكام كما هو مقترح. وبغية تفعيل الحظر المفروض على تاجر الفوركس بالتجزئة في البنك الذي يمارس حق المقاصة، يتطلب كل من أوك و فديك أن يحتفظ بهامش معاملات التجزئة في كل حساب من العملاء في حساب منفصل لا يحمل سوى العملاء هامش تجارة الفوركس بالتجزئة. وكما هو مقترح، فإن المجلس لا يشترط استخدام حساب هامش منفصل، لأنه لا يحظر على مؤسسة مصرفية ممارسة حق المقاصة. القسم 240.10mdash التقارير المقدمة للعملاء يتطلب هذا القسم مؤسسة مصرفية تشارك في معاملات الفوركس بالتجزئة لتقديم كل تأكيدات العملاء الفوركس بالتجزئة والبيانات الشهرية، ويصف المعلومات التي سيتم تضمينها. ولم يتلق المجلس أي تعليقات على هذا الفرع واعتمده كما هو مقترح. Section 240.11mdashUnlawful Representations This section prohibits a banking institution and its related persons from representing that the Federal government, the Board, or any other Federal agency has sponsored, recommended, or approved retail forex transactions or products in any way. This section also prohibits a banking institution from implying or representing that it will guarantee against or limit retail forex customer losses or not collect margin as required by section 240.9. This section does not prohibit a banking institution from sharing in a loss resulting from error or mishandling of an order, and guaranties entered into prior to the effectiveness of the prohibition would only be affected if an attempt is made to extend, modify, or renew them. This section also does not prohibit a banking institution from hedging or otherwise mitigating its own exposure to retail forex transactions or any other foreign exchange risk. The Board received no comments to this section and adopts it as proposed. Section 240.12mdashAuthorization to Trade This section requires a banking institution to have specific authorization from a retail forex customer before effecting a retail forex transaction for that customer. The Board received no comments to this section and adopts it as proposed. Section 240.13mdashTrading and Operational Standards This section largely follows the trading standards of the retail forex rules adopted by the CFTC, OCC and FDIC, which were developed to prevent some of the deceptive or unfair practices identified by the CFTC and the National Futures Association. Under paragraph (a), a banking institution engaging in retail forex transactions is required to establish and enforce internal rules, procedures and controls to prevent front running, in which transactions in accounts of the banking institution or its related persons are executed before a similar customer order, and to establish settlement prices fairly and objectively. Paragraph (b) prohibits a banking institution engaging in retail forex transactions from disclosing that it holds another persons order unless disclosure is necessary for execution or is made at the Boards request. Paragraph (c) ensures that related persons of another retail forex counterparty do not open accounts with a banking institution without the knowledge and authorization of the account surveillance personnel of the other retail forex counterparty to which they are affiliated. Similarly, paragraph (d) ensures that related persons of a banking institution do not open accounts with other retail forex counterparties without the knowledge and authorization of the account surveillance personnel of the banking institution to which they are affiliated. Paragraph (e) prohibits a banking institution engaging in retail forex transactions from (1) Entering a retail forex transaction to be executed at a price that is not at or near prices at which other retail forex customers have executed materially similar transactions with the banking institution during the same time period, (2) changing prices after confirmation, (3) providing a retail forex customer with a new bid price that is higher (or lower) than previously provided without providing a new ask Start Printed Page 21025 price that is similarly higher (or lower) as well, and (4) establishing a new position for a retail forex customer (except to offset an existing position) if the banking institution holds one or more outstanding orders of other retail forex customers for the same currency pair at a comparable price. Paragraphs (e)(3) and (e)(4) do not prevent a banking institution from changing the bid or ask prices of a retail forex transaction to respond to market events. The Board understands that market practice among CFTC-registrants is not to offer requotes, but to simply reject orders and advise customers they may submit a new order (which the dealer may or may not accept). Similarly, a banking institution may reject an order and advise customers they may submit a new order. Paragraph (e)(5) requires a banking institution to use consistent market prices for customers executing retail forex transactions during the same time. It also prevents a banking institution from offering preferred execution to some of its retail forex customers but not others. The Board received no comments to this section and adopts it as proposed. Section 240.14mdashSupervision This section imposes on a banking institution and its agents, officers, and employees a duty to supervise subordinates with responsibility for retail forex transactions to ensure compliance with the Boards retail forex rule. The Board received no comments to this section and adopts it as proposed. Section 240.15mdashNotice of Transfers This section describes the requirements for transferring a retail forex account. Generally, a banking institution must provide retail forex customers 30 days prior notice before transferring or assigning their account. Affected customers may then instruct the banking institution to transfer the account to an institution of their choosing or liquidate the account. There are three exceptions to the above notice requirement: a transfer in connection with the receivership or conservatorship under the Federal Deposit Insurance Act a transfer pursuant to a retail forex customers specific request and a transfer otherwise allowed by applicable law. A banking institution that is the transferee of retail forex accounts must generally provide the transferred customers with the risk disclosure statement of section 240.6 and obtain each affected customers written acknowledgement within 60 days. The Board received no comments to this section and adopts it as proposed. Section 240.16mdashCustomer Dispute Resolution This section prohibits a banking institution from entering into any agreement or understanding with a retail forex customer in which the customer agrees, prior to the time a claim or grievance arises, to submit the claim or grievance to any settlement procedure. This provision differs from the applicable CFTC and OCC dispute settlement procedures, which permit mandatory pre-dispute settlement agreements under certain conditions. 36 The Board proposed to prohibit a banking institution from entering into a pre-dispute settlement agreement with a retail forex customer, similar to the final rule adopted by the FDIC. The Department of State has advised that transactions between the foreign branch or office of a banking institution and a U. S. customer could be cross-border transactions subject to the New Yorkthinsp 37 and Panama Conventions. 38 These Conventions, implemented in the United States by chapters 2 and 3 of the Federal Arbitration Act (FAA), 39 create treaty obligations to enforce international commercial arbitration agreements and to recognize and enforce international commercial arbitral awards. The Board is amending section 240.16 to provide that it will not apply to transactions covered by chapters 2 or 3 of the FAA. Section 240.17mdashReservation of Authority. This section allows the Board to modify certain requirements of this rule consistent with safety and soundness and the protection of retail forex customers. The Board understands the need for flexibility as foreign exchange trading procedures develop and to ensure that such products or trading procedures are subject to appropriate customer protection and safety and soundness standards. Interagency Statement on Retail Sales of Nondeposit Investment Products For banking institutions, the requirements in the Boards retail forex regulation overlap with applicable expectations contained in the Interagency Statement on Retail Sales of Nondeposit Investment Products (NDIP Policy Statement). 40 The NDIP Policy Statement sets out guidance regarding the Boards expectations when a banking institution engages in the sale of nondeposit investment products to retail customers. The NDIP Policy Statement addresses issues such as disclosure, suitability, sales practices, compensation, and compliance. The Board views retail forex transactions as nondeposit investment products, but the terms ldquoretail forex customerrdquo in this rule and ldquoretail customerrdquo in the NDIP Policy Statement are not necessarily co-extensive. The Board requested comment on whether the proposed regulation created issues concerning application of the NDIP policy statement to retail forex transactions that the Board should address. The Board received no comments on this issue. As the Board noted in its proposal, after the effective date of the final rule, the Board will expect banking institutions engaging in or offering retail forex transactions to also comply with the NDIP Policy Statement to the extent such compliance does not conflict with the requirements of the Boards final retail forex rule. III. Regulatory Analysis A. Regulatory Flexibility Act In accordance with Section 4(a) of the Regulatory Flexibility Act, 5 U. S.C. 601 et seq, (RFA), the Board must publish a final regulatory flexibility analysis with this rulemaking. The RFA requires an agency either to provide a final regulatory flexibility analysis with a final rule for which a general notice of proposed rulemaking is required or to certify that the final rule will not have a significant economic impact on a substantial number of small entities. Based on this analysis and for the reasons stated below, the Board believes that the final rule would not have a significant economic impact on a substantial number of small entities. Nevertheless, the Board is publishing a final regulatory flexibility analysis. 1. A succinct statement of the need for, and objectives of, the rule. Section 2(c)(2)(E) of the Commodity Exchange Act (7 U. S.C. 2 (c)(2)(E)) Start Printed Page 21026 prohibits a U. S. financial institution from conducting certain retail foreign exchange transactions unless done pursuant a rule or regulation of a Federal regulatory agency allowing such transactions. The Board is adopting a new regulation to allow banking institutions under its supervision to engage in retail foreign exchange transactions. 2. A Summary of the Significant Issues Raised by the Public Comments in Response to the Initial Regulatory Flexibility Analysis, a Summary of the Assessment of the Agency of Such Issues, and a Statement of Any Changes Made in the Proposed Rule as a Result of Such Comments The Board requested comment on required reporting, disclosure, and recordkeeping requirements for all banking institutions engaging in retail foreign exchange transactions and has solicited comment on any approaches that would reduce the burden on all counterparties, including small entities. In response to the notice of proposed rulemaking, the Board received no comments with respect to RFA. 3. A Description of and an Estimate of the Number of Small Entities To Which the Rule Will Apply or an Explanation of Why No Such Estimate Is Available Under regulations issued by the Small Business Administration, a banking institution is considered a ldquosmall entityrdquo if it has assets of 175 million or less. 41 As of June 30, 2012, there were approximately 368 small state member banks, 6 small Edge Act and agreement corporations, 48 small uninsured branches of foreign banks, 3,736 small bank holding companies, 213 small financial holding companies, and 229 small saving and loan holding companies. The Board is not aware of any small institutions engaged in retail forex transactions. 4. A Description of the Projected Reporting, Recordkeeping, and Other Compliance Requirements of the Rule, Including an Estimate of the Classes of Small Entities Which Will Be Subject to the Requirement and the Type of Professional Skills Necessary for Preparation of the Report or Record A description of the projected recordkeeping and other compliance requirements can be found below in section B, ldquoPaperwork Reduction Act, rdquo under the following headings: Reporting Requirements, Disclosure Requirements, and Recordkeeping Requirements. The Board believes that there are no other compliance requirements for this rule. 5. A Description of the Steps the Agency Has Taken To Minimize the Significant Economic Impact on Small Entities Consistent With the Stated Objectives of Applicable Statutes, Including a Statement of the Factual, Policy, and Legal Reasons for Selecting the Alternative Adopted in the Final Rule and Why Each One of the Other Significant Alternatives to the Rule Considered by the Agency Which Affect the Impact on Small Entities Was Rejected The Board believes that no Federal rules duplicate, overlap, or conflict with the rule. The Board has solicited comments on the proposed rule and received relatively few comments. The Board did not receive any comments from small entities and is unaware of any small entities that will be affected by the rule. The Boards rule is consistent with other banking regulators that also solicited comment on their rules. As noted in the supplementary information above, retail forex transactions are also subject to the Interagency Statement on Retail Sales of Nondeposit Investment Products, but this rule would govern to the extent of a conflict. B. Paperwork Reduction Act In accordance with section 3512 of the Paperwork Reduction Act (PRA) of 1995 (44 U. S.C. 3501 -3521), the Board may not conduct or sponsor, and a respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number. The Board reviewed the final rule under the authority delegated to the Board by OMB. The OMB control number for these information collections will be assigned. The Board received no comments regarding the Paperwork Reduction Act implications of its retail forex regulation. Title of Information Collection: Reporting, recordkeeping, and disclosure requirements associated with Regulation NN. Frequency of Response: On occasion. Affected Public: Businesses or other for-profit. Respondents: Agreement corporations, Edge Act corporations, state member banks, uninsured branches of foreign banks, financial holding companies, and bank holding companies (collectively, ldquobanking institutionsrdquo). Abstract: The information collection requirements of the final rule are found in sectsectthinsp240.4-240.7, 240.9-240.10, 240.13, 240.15-240.16. Reporting Requirements The reporting requirements in sectthinsp240.4 require that, prior to initiating a retail forex business, a banking institution provide the Board with prior notice. The notice must certify that the banking institution has written policies and procedures, and risk measurement and management systems in controls in place to ensure that retail forex transactions are conducted in a safe and sound manner. The banking institution must also provide other information required by the Board, such as documentation of customer due diligence, new product approvals, and haircuts applied to noncash margins. A banking institution already engaging in a retail forex business may continue to do so, provided it requests an extension of time. Disclosure Requirements Section 240.5, regarding the application and closing out of offsetting long and short positions, requires a banking institution to promptly provide the customer with a statement reflecting the financial result of the transactions and the name of the introducing broker to the account. The customer may provide specific written instructions on how the offsetting transaction should be applied. Section 240.6 requires that a banking institution furnish a retail forex customer with a written disclosure before opening an account that will engage in retail forex transactions for a retail forex customer and receive an acknowledgment from the customer that it was received and understood. It also requires the disclosure by a banking institution of its fees and other charges and its profitable accounts ratio. Section 240.10 requires a banking institution to issue monthly statements to each retail forex customer and to send confirmation statements following transactions. Section 240.13(b) allows disclosure by a banking institution that an order of another person is being held by them only when necessary to the effective execution of the order or when the disclosure is requested by the Board. Section 240.13(c) prohibits a banking institution engaging in retail forex transactions from knowingly handling the account of any related person of another retail forex counterparty unless it receives proper written authorization, promptly prepares a written record of the order, and transmits to the counterparty copies all statements and written records. Section 240.13(d) Start Printed Page 21027 prohibits a related person of a banking institution engaging in forex transactions from having an account with another retail forex counterparty unless it receives proper written authorization and copies of all statements and written records for such accounts are transmitted to the counterparty. Section 240.15 requires a banking institution to provide a retail forex customer with 30 days prior notice of any assignment of any position or transfer of any account of the retail forex customer. It also requires a banking institution to which retail forex accounts or positions are assigned or transferred to provide the affected customers with risk disclosure statements and forms of acknowledgment and receive the signed acknowledgments within 60 days. The customer dispute resolution provisions in sectthinsp240.16 requires certain endorsements, acknowledgments, and signature language. It also requires that within 10 days after receipt of notice from the retail forex customer that they intend to submit a claim to arbitration, the banking institution will provide them with a list of persons qualified in the dispute resolution and that the customer must notify the banking institution of the person selected within 45 days of receipt of such list. Recordkeeping Requirements Sections 240.7 and 240.13(a) require that a banking institution engaging in retail forex transactions keep full, complete, and systematic records and establish and implement internal rules, procedures, and controls. Section 240.7 also requires that a banking institution keep account, financial ledger, transaction and daily records, as well as memorandum orders, post-execution allocation of bunched orders, records regarding its ratio of profitable accounts, possible violations of law, records for noncash margin, and monthly statements and confirmations. Section 240.9 requires policies and procedures for haircuts for noncash margin collected under the rules margin requirements, and annual evaluations and modifications of the haircuts. Estimated PRA Burden Number of Respondents: 5 banking institutions 2 service providers. Estimated Average Hours per Response: 16 hours reporting burden 787 hours disclosure burden and 183 hours recordkeeping burden Total Estimated Annual Burden: 6,870 hours (80 hours reporting burden 5,509 hours disclosure burden and 1,281 hours recordkeeping burden). The Board has a continuing interest in the publics opinions of collections of information. At any time, comments regarding the burden estimate, or any other aspect of this collection of information, including suggestions for reducing the burden, may be sent to: Secretary, Board of Governors of the Federal Reserve System, 20th and C Streets NW. Washington, DC 20551 and to the Office of Management and Budget, Paperwork Reduction Project, Washington, DC 20503. C. Plain Language Section 722 of the Gramm-Leach-Bliley Act requires the Board to use plain language in all proposed and final rules published after January 1, 2000. No commenters suggested that the proposed rule was materially unclear, and the Board believes that the Final Rule is substantively similar to the proposed rule. Start List of Subjects List of Subjects in 12 CFR Part 240 For the reasons stated in the preamble, the Board amends 12 CFR Chapter II by adding new part 240 to read as follows: PART 240mdashRETAIL FOREIGN EXCHANGE TRANSACTIONS (REGULATION NN) 240.1 Authority, purpose, and scope. 240.2 Definitions. 240.3 Prohibited transactions. 240.4 Notification. 240.5 Application and closing out of offsetting long and short positions. 240.6 Disclosure. 240.7 Recordkeeping. 240.8 Capital requirements. 240.9 Margin requirements. 240.10 Required reporting to customers. 240.11 Unlawful representations. 240.12 Authorization to trade. 240.13 Trading and operational standards. 240.14 Supervision. 240.15 Notice of transfers. 240.16 Customer dispute resolution. 240.17 Reservation of authority. Authority, purpose and scope. (a) Authority. This part is issued by the Board of Governors of the Federal Reserve System (the Board) under the authority of section 2(c)(2)(E) of the Commodity Exchange Act (7 U. S.C. 2 (c)(2)(E)), sections 9 and 11 of the Federal Reserve Act (12 U. S.C. 321 -338 and 248), section 5(b) of the Bank Holding Company Act of 1956 (12 U. S.C. 1844 (b)), sections 9 and 13a of the International Banking Act of 1978 (12 U. S.C. 3106 a and 3108), and sections 3(q) and 8 of the Federal Deposit Insurance Act (12 U. S.C. 1813 (q) and 1818). (b) Purpose. This part establishes rules applicable to retail foreign exchange transactions engaged in by banking institutions on or after May 13, 2013. (c) Scope. Except as provided in paragraph (d) of this section, this part applies to banking institutions, as defined in section 240.2(b) of this part, and any branches or offices of those institutions wherever located. This part applies to subsidiaries of banking institutions organized under the laws of the United States or any U. S. state that are not subject to the jurisdiction of another federal regulatory agency authorized to prescribe rules or regulations under section 2(c)(2)(E) of the Commodity Exchange Act (7 U. S.C. (2)(c)(2)(E)). (d) International applicability. Sections 240.3 and 240.5 through 240.16 do not apply to retail foreign exchange transactions between a foreign branch or office of a banking institution and a non-U. S. customer. With respect to those transactions, the foreign branch or office remains subject to any disclosure, recordkeeping, capital, margin, reporting, business conduct, documentation, and other requirements of applicable foreign law. For purposes of this part, the following terms have the same meaning as in the Commodity Exchange Act (7 U. S.C. 1 et seq.): ldquoaffiliated person of a futures commission merchantrdquo ldquoassociated personrdquo ldquocontract of salerdquo ldquocommodityrdquo ldquofutures commission merchantrdquo ldquofuture deliveryrdquo ldquooptionrdquo ldquosecurityrdquo and ldquosecurity futures product. rdquo (a) Affiliate has the same meaning as in section 2(k) of the Bank Holding Company Act of 1956 (12 U. S.C. 1841 (k)). (b) Banking institution means: (1) A state member bank (as defined in 12 CFR 208.2 ) (2) An uninsured state-licensed U. S. branch or agency of a foreign bank (3) A financial holding company (as defined in section 2 of the Bank Holding Company Act of 1956 12 U. S.C. 1841 ) (4) A bank holding company (as defined in section 2 of the Bank Holding Company Act of 1956 12 U. S.C. 1841 ) Start Printed Page 21028 (5) A savings and loan holding company (as defined in section 10 of the Home Owners Loan Act 12 U. S.C. 1467 a) (6) A corporation operating under the fifth undesignated paragraph of section 25 of the Federal Reserve Act (12 U. S.C. 603 ), commonly known as ldquoan agreement corporationrdquo and (7) A corporation organized under section 25A of the Federal Reserve Act (12 U. S.C. 611 et seq.), commonly known as an ldquoEdge Act corporation. rdquo (c) Commodity Exchange Act means the Commodity Exchange Act (7 U. S.C. 1 et seq. ). (d) Eligible contract participant has the same meaning as in the Commodity Exchange Act (7 U. S.C. 1 et seq., as implemented in 17 CFR 1.3 (m). (e) Forex means foreign exchange. (f) Identified banking product has the same meaning as in section 401(b) of the Legal Certainty for Bank Products Act of 2000 (7 U. S.C. 27 (b)). (g) Institution-affiliated party or IAP has the same meaning as in 12 U. S.C. 1813 (u)(1), (2), or (3). (h) Introducing broker means any person who solicits or accepts orders from a retail forex customer in connection with retail forex transactions. (i) Related person, when used in reference to a retail forex counterparty, means: (1) Any general partner, officer, director, or owner of ten percent or more of the capital stock of the retail forex counterparty (2) An associated person or employee of the retail forex counterparty, if the retail forex counterparty is not an insured depository institution (3) An IAP, if the retail forex counterparty is an insured depository in stitution and (4) Any relative or spouse of any of the foregoing persons, or any relative of such spouse, who shares the same home as any of the foregoing persons. (j) Retail foreign exchange dealer means any person other than a retail forex customer that is, or that offers to be, the counterparty to a retail forex transaction, except for a person described in item (aa), (bb), (cc)(AA), (dd), or (ff) of section 2(c)(2)(B)(i)(II) of the Commodity Exchange Act (7 U. S.C. 2 (c)(2)(B)(i)(II)). (k) Retail forex account means the account of a retail forex customer, established with a banking institution, in which retail forex transactions with the banking institution as counterparty are undertaken, or the account of a retail forex customer that is established in order to enter into such transactions. (l) Retail forex account agreement means the contractual agreement between a banking institution and a retail forex customer that contains the terms governing the customers retail forex account with the banking institution. (m) Retail forex business means engaging in one or more retail forex transactions with the intent to derive income from those transactions, either directly or indirectly. (n) Retail forex counterparty includes, as appropriate: (1) A banking institution (2) A retail foreign exchange dealer (3) A futures commission merchant (4) An affiliated person of a futures commission merchant and (5) A broker or dealer registered under section 15(b) (except paragraph (11) thereof) or 15C of the Securities Exchange Act of 1934 (15 U. S.C. 78 o(b), 78o-5) or a U. S. financial institution other than a banking institution, provided the counterparty is subject to a rule or regulation of a Federal regulatory agency covering retail forex transactions. (o) Retail forex customer means a customer that is not an eligible contract participant, acting on his, her, or its own behalf and engaging in retail forex transactions. (p) Retail forex proprietary account means a retail forex account carried on the books of a banking institution for one of the following persons a retail forex account of which 10 percent or more is owned by one of the following persons or a retail forex account of which an aggregate of 10 percent or more of which is owned by more than one of the following persons: (1) The banking institution (2) An officer, director or owner of ten percent or more of the capital stock of the banking institution or (3) An employee of the banking institution, whose duties include: (i) The management of the banking institutions business (ii) The handling of the banking institutions retail forex transactions (iii) The keeping of records, including without limitation the software used to make or maintain those records, pertaining to the banking institutions retail forex transactions or (iv) The signing or co-signing of checks or drafts on behalf of the banking institution (4) A spouse or minor dependent li ving in the same household as of any of the foregoing persons or (5) An affiliate of the banking institution (q) Retail forex transaction means an agreement, contract, or transaction in foreign currency, other than an identified banking product or a part of an identified banking product, that is offered or entered into by a banking institution with a person that is not an eligible contract participant and that is: (1) A contract of sale of a commodity for future delivery or an option on such a contract or (2) An option, other than an option executed or traded on a national securities exchange registered pursuant to section 6(a) of the Securities Exchange Act of 1934 (15 U. S.C. 78 f(a)) or (3) Offered or entered into on a leveraged or margined basis, or financed by a banking institution, its affiliate, or any person acting in concert with the banking institution or its affiliate on a similar basis, other than: (i) A security that is not a security futures product as defined in section 1a(47) of the Commodity Exchange Act (7 U. S.C. 1 a(47)) or (ii) A contract of sale thatmdash (A) Results in actual delivery within two days or (B) Creates an enforceable obligation to deliver between a seller and buyer that have the ability to deliver and accept delivery, respectively, in connection with their line of business or (iii) An agreement, contract, or transaction that the Board determines is not functionally or economically similar to an agreement, contract, or transaction described in paragraph (p)(1) or (p)(2) of this section. (a) Fraudulent conduct prohibited. No banking institution or its related persons may, directly or indirectly, in or in connection with any retail forex transaction: (1) Cheat or defraud or attempt to cheat or defraud any person (2) Knowingly make or cause to be made to any person any false report or statement or cause to be entered for any person any false record or (3) Knowingly deceive or attempt to deceive any person by any means whatsoever. (b) Acting as counterparty and exercising discretion prohibited. A banking institution that has authority to cause retail forex transactions to be effected for a retail forex customer without the retail forex customers specific authorization may not (and an affiliate of such an institution may not) act as the counterparty for any retail forex transaction with that retail forex customer. (a) Notification required. Before commencing a retail forex business, a Start Printed Page 21029 banking institution shall provide the Board with prior written notice in compliance with this section. The notice will become effective 60 days after a complete notice is received by the Board, provided the Board does not request additional information or object in writing. In the event the Board requests additional information, the notice will become effective 60 days after all information requested by the Board is received by the Board unless the Board objects in writing. (b) Notification requirements. A banking institution shall provide the following in its written notification: (1) Information concerning customer due diligence, including without limitation credit evaluations, customer appropriateness, and ldquoknow your customerrdquo documentation (2) The haircuts to be applied to noncash margin as provided in 240.9(b)(2) (3) Information concerning new product approvals (4) Information on addressing conflicts of interest and (5) A resolution by the banking institutions Board of Directors that the banking institution has established and implemented written policies, procedures, and risk measurement and management systems and controls for the purpose of ensuring that it conducts retail forex transactions in a safe and sound manner and in compliance with this part. (c) Treatment of existing retail forex businesses. A banking institution that is engaged in a retail forex business on the effective date of this part may continue to do so, until and unless the Board objects in writing, so long as the institution submits the information required to be submitted under paragraphs (b)(1) through (5) of this section within 30 days of the effective date of this part, subject to an extension of time by the Board, and such additional information as requested by the Board thereafter. (d) Compliance with the Commodity Exchange Act. A banking institution that is engaged in a retail forex business on the effective date of this part and complies with paragraph (c) of this section shall be deemed to be acting pursuant to a rule or regulation described in section 2(c)(2)(E)(ii)(I) of the Commodity Exchange Act (7 U. S.C. 2 (c)(2)(E)(ii)(I)). Application and closing out of offsetting long and short positions. (a) Application of purchases and sales. Any banking institution thatmdash (1) Engages in a retail forex transaction involving the purchase of any currency for the account of any retail forex customer when the account of such retail forex customer at the time of such purchase has an open retail forex transaction for the sale of the same currency (2) Engages in a retail forex transaction involving the sale of any currency for the account of any retail forex customer when the account of such retail forex customer at the time of such sale has an open retail forex transaction for the purchase of the same currency (3) Purchases a put or call option involving foreign currency for the account of any retail forex customer when the account of such retail forex customer at the time of such purchase has a short put or call option position with the same underlying currency, strike price, and expiration date as that purchased or (4) Sells a put or call option involving foreign currency for the account of any retail forex customer when the account of such retail forex customer at the time of such sale has a long put or call option position with the same underlying currency, strike price, and expiration date as that sold shall: (i) Immediately apply such purchase or sale against such previously held opposite transaction with the same customer and (ii) Promptly furnish such retail forex customer with a statement showing the financial result of the transactions involved and the name of any introducing broker to the account. (b) Close-out against oldest open position. In all instances in which the short or long position in a customers retail forex account immediately prior to an offsetting purchase or sale is greater than the quantity purchased or sold, the banking institution shall apply such offsetting purchase or sale to the oldest portion of the previously held short or long position. (c) Transactions to be applied as directed by customer. Notwithstanding paragraphs (a) and (b) of this section, the offsetting transaction shall be applied as directed by a retail forex customers specific instructions. These instructions may not be made by the banking institution or a related person. (a) Risk disclosure statement required. No banking institution may open or maintain an account for a retail forex customer for the purpose of engaging in retail forex transactions unless the banking institution has furnished the retail forex customer with a separate written disclosure statement containing only the language set forth in paragraph (d) of this section and the disclosures required by paragraphs (e), (f), and (g) of this section. (b) Acknowledgement of risk disclosure statement required. The banking institution must receive from the retail forex customer a written acknowledgement signed and dated by the customer that the customer received and understood the written disclosure statement required by paragraph (a) of this section. (c) Placement of risk disclosure statement. The disclosure statement may be attached to other documents as the initial page(s) of such documents and as the only material on such page(s). (d) Content of risk disclosure statement. The language set forth in the written disclosure statement required by paragraph (a) of this section shall be as follows: Risk Disclosure Statement Retail forex transactions generally involve the leveraged trading of contracts denominated in foreign currency with a banking institution as your counterparty. Because of the leverage and the other risks disclosed here, you can rapidly lose all of the funds or property you give the banking institution as margin for such trading and you may lose more than you pledge as margin. You should be aware of and carefully consider the following points before determining whether such trading is appropriate for you. (1) Trading foreign currencies is a not on a regulated market or exchangemdashyour banking institution is your trading counterparty and has conflicting interests. The retail forex transaction you are entering into is not conducted on an interbank market, nor is it conducted on a futures exchange subject to regulation by the Commodity Futures Trading Commission. The foreign currency trades you transact are trades with your banking institution as the counterparty. When you sell, the banking institution is the buyer. When you buy, the banking institution is the seller. As a result, when you lose money trading, your banking institution is making money on such trades, in addition to any fees, commissions, or spreads the banking institution may charge. (2) Any electronic trading platform that you may use for retail foreign currency transactions with your banking institution is not a regulated exchange. It is an electronic connection for accessing your banking institution. The terms of availability of such a platform are governed only by your contract with your banking institution. Any trading platform that you may use to enter into off-exchange foreign currency transactions is only connected to your banking institution. You are accessing that trading platform only to transact with your banking institution. You are not trading with any other entities or customers of the banking institution by accessing such platform. The availability and operation of any such platform, including the consequences of the unavailability of the Start Printed Page 21030 trading platform for any reason, is governed only by the terms of your account agreement with the banking institution. (3) You may be able to offset or liquidate any trading positions only through your banking institution because the transactions are not made on an exchange, and your banking institution may set its own prices. Your ability to close your transactions or offset positions is limited to what your banking institution will offer to you, as there is no other market for these transactions. Your banking institution may offer any prices it wishes. Your banking institution may establish its prices by offering spreads from third party prices, but it is under no obligation to do so or to continue to do so. Your banking institution may offer different prices to different customers at any point in time on its own terms. The terms of your account agreement alone govern the obligations your banking institution has to you to offer prices and offer offset or liquidating transactions in your account and make any payments to you. The prices offered by your banking institution may or may not reflect prices available elsewhere at any exchange, interbank, or other market for foreign currency. (4) Paid solicitors may have undisclosed conflicts. The banking institution may compensate introducing brokers for introducing your account in ways that are not disclosed to you. Such paid solicitors are not required to have, and may not have, any special expertise in trading, and may have conflicts of interest based on the method by which they are compensated. You should thoroughly investigate the manner in which all such solicitors are compensated and be very cautious in granting any person or entity authority to trade on your behalf. You should always consider obtaining dated written confirmation of any information you are relying on from your banking institution in making any trading or account decisions. (5) Retail forex transactions are not insured by the Federal Deposit Insurance Corporation. (6) Retail forex transactions are not a deposit in, or guaranteed by, a banking institution. (7) Retail forex transactions are subject to investment risks, including possible loss of all amounts invested. Finally, you should thoroughly investigate any statements by any banking institution that minimize the importance of, or contradict, any of the terms of this risk disclosure. Such statements may indicate sales fraud. This brief statement cannot, of course, disclose all the risks and other aspects of trading off-exchange foreign currency with a banking institution. I hereby acknowledge that I have received and understood this risk disclosure statement. Signature of Customer (e)(1) Disclosure of profitable accounts ratio. Immediately following the language set forth in paragraph (d) of this section, the statement required by paragraph (a) of this section shall include, for each of the most recent four calendar quarters during which the banking institution maintained retail forex customer accounts: (i) The total number of retail forex customer accounts maintained by the banking institution over which the banking institution does not exercise investment discretion (ii) The percentage of such accounts that were profitable for retail forex customer accounts during the quarter and (iii) The percentage of such accounts that were not profitable for retail forex customer accounts during the quarter. (2) Statement of profitable trades. (i) The banking institutions statement of profitable trades shall include the following legend: Past performance is not necessarily indicative of future results. (ii) Each banking institution shall provide, upon request, to any retail forex customer or prospective retail forex customer the total number of retail forex accounts maintained by the banking institution for which the banking institution does not exercise investment discretion, the percentage of such accounts that were profitable, and the percentage of such accounts that were not profitable for each calendar quarter during the most recent five-year period during which the banking institution maintained such accounts. (f) Disclosure of fees and other charges. Immediately following the language required by paragraph (e) of this section, the statement required by paragraph (a) of this section shall include: (1) The amount of any fee, charge, spread, or commission that the banking institution may impose on the retail forex customer in connection with a retail forex account or retail forex transaction (2) An explanation of how the banking institution will determine the amount of such fees, charges, spreads, or commissions and (3) The circumstances under which the banking institution may impose such fees, charges, spreads, or commissions. (g) Set-off. Immediately following the language required by paragraph (f) of this section, the statement required by paragraph (a) of this section shall include: (1) A statement as to whether the banking institution will or will not retain the right to set off obligations of the retail forex customer arising from the customers retail forex transactions, including margin calls and losses, against the customers other assets held by the banking institution (2) If the banking institution states that it reserves its right to set off obligations of the retail forex customer arising from the customers retail forex transactions against the customers other assets, the banking institution must receive from the retail forex customer a written acknowledgement signed and dated by the customer that the customer received and understood the written disclosure required by paragraph (g)(1) of this section. (h) Future disclosure requirements. If, with regard to a retail forex customer, the banking institution changes any fee, charge, or commission required to be disclosed under paragraph (f) of this section, then the banking institution shall mail or deliver to the retail forex customer a notice of the changes at least 15 days prior to the effective date of the change. (i) Form of disclosure requirements. The disclosures required by this section shall be clear and conspicuous and designed to call attention to the nature and significance of the information provided. (j) Other disclosure requirements unaffected. This section does not relieve a banking institution from any other disclosure obligation it may have under applicable law. (a) General rule. A banking institution engaging in retail forex transactions shall keep full, complete and systematic records, together with all pertinent data and memoranda, of all transactions relating to its retail forex business, including: (1) Retail forex account records. For each retail forex account: (i) The name and address of the person for whom such retail forex account is carried or introduced and the principal occupation or business of the person (ii) The name of any other person guaranteeing the account or exercising trading control with respect to the account (iii) The establishment or termination of the account (iv) A means to identify the person who has solicited and is responsible for the account or assign account numbers in such a manner as to identify that person (v) The funds in the account, net of any commissions and fees (vi) The accounts net profits and losses on open trades (vii) The funds in the account plus or minus the net profits and losses on open trades, adjusted for the net option value in the case of open options positions Start Printed Page 21031 (viii) Financial ledger records that show separately for each retail forex customer all charges against and credits to such retail forex customers account, including but not limited to retail forex customer funds deposited, withdrawn, or transferred, and charges or credits resulting from losses or gains on closed transactions and (ix) A list of all retail forex transactions executed for the account, with the details specified in paragraph (a)(2) of this section. (2) Retail forex transaction records. For each retail forex transaction: (i) The date and time the banking institution received the order (ii) The price at which the banking institution placed the order, or, in the case of an option, the premium that the retail forex customer paid (iii) The customer account identification information (iv) The currency pair (v) The size or quantity of the order (vi) Whether the order was a buy or sell order (vii) The type of order, if the order was not a market order (viii) The size and price at which the order is executed, or in the case of an option, the amount of the premium paid for each option purchased, or the amount credited for each option sold (ix) For options, whether the option is a put or call, expiration date, quantity, underlying contract for future delivery or underlying physical, strike price, and details of the purchase price of the option, including premium, mark-up, commission, and fees (x) For futures, the delivery date and (xi) If the order was made on a trading platfor m: (A) The price quoted on the trading platform when the order was placed, or, in the case of an option, the premium quoted (B) The date and time the order was transmitted to the trading platform and (C) The date and time the order was executed. (3) Price changes on a trading platform. If a trading platform is used, daily logs showing each price change on the platform, the time of the change to the nearest second, and the trading volume at that time and price. (4) Methods or algorithms. Any method or algorithm used to determine the bid or asked price for any retail forex transaction or the prices at which customers orders are executed, including, but not limited to, any mark-ups, fees, commissions or other items which affect the profitability or risk of loss of a retail forex customers transaction. (5) Daily records which show for each business day complete details of: (i) All retail forex transactions that are futures transactions executed on that day, including the date, price, quantity, market, currency pair, delivery date, and the person for whom such transaction was made (ii) All retail forex transactions that are option transactions executed on that day, including the date, whether the transaction involved a put or call, the expiration date, quantity, currency pair, delivery date, strike price, details of the purchase price of the option, including premium, mark-up, commission and fees, and the person for whom the transaction was made and (iii) All other retail forex transactions executed on that day for such account, including the date, price, quantity, currency and the person for whom such transaction was made. (6) Other records. Written acknowledgements of receipt of the risk disclosure statement required by sectthinsp240.6(b), offset instructions pursuant to sectthinsp240.5(c), records required under paragraphs (b) through (f) of this section, trading cards, signature cards, street books, journals, ledgers, payment records, copies of statements of purchase, and all other records, data and memoranda that have been prepared in the course of the banking institutions retail forex business. (b) Ratio of profitable accounts. (1) With respect to its active retail forex customer accounts over which it did not exercise investment discretion and that are not retail forex proprietary accounts open for any period of time during the quarter, a banking institution shall prepare and maintain on a quarterly basis (calendar quarter): (i) A calculation of the percentage of such accounts that were profitable (ii) A calculation of the percentage of such accounts that were not profitable and (iii) Data supporting the calculations described in paragraphs (b)(1)(i) and (b)(1)(ii) of this section. (2) In calculating whether a retail forex account was profitable or not profitable during the quarter, the banking institution shall compute the realized and unrealized gains or losses on all retail forex transactions carried in the retail forex account at any time during the quarter, and subtract all fees, commissions, and any other charges posted to the retail forex account during the quarter, and add any interest income and other income or rebates credited to the retail forex account during the quarter. All deposits and withdrawals of funds made by the retail forex customer during the quarter must be excluded from the computation of whether the retail forex account was profitable or not profitable during the quarter. Computations that result in a zero or negative number shall be considered a retail forex account that was not profitable. Computations that result in a positive number shall be considered a retail forex account that was profitable. (3) A retail forex account shall be considered ldquoactiverdquo for purposes of paragraph (b)(1) of this section if and only if, for the relevant calendar quarter, a retail forex transaction was executed in that account or the retail forex account contained an open position resulting from a retail forex transaction. (c) Records related to possible violations of law. A banking institution engaging in retail forex transactions shall make a record of all communications received by the banking institution or its related persons concerning facts giving rise to possible violations of law related to the banking institutions retail forex business. The record shall contain: the name of the complainant, if provided the date of the communication the relevant agreement, contract, or transaction the substance of the communication and the name of the person who received the communication and the final disposition of the matter. (d) Records for noncash margin. A banking institution shall maintain a record of all noncash margin collected pursuant to sectthinsp240.9. The record shall show separately for each retail forex customer: (1) A description of the securities or property received (2) The name and address of such retail forex customer (3) The dates when the securities or property were received (4) The identity of the depositories or other places where such securities or property are segregated or held, if applicable (5) The dates on which the banking institution placed or removed such securities or property into or from such depositories and (6) The dates of return of such securities or property to such retail forex customer, or other disposition thereof, together with the facts and circumstances of such other disposition. (e) Order tickets. (1) Except as provided in paragraph (e)(2) of this section, immediately upon the receipt of a retail forex transaction order, a banking institution shall prepare an order ticket for the order (whether unfulfilled, executed or canceled). The order ticket shall include: (i) Account identification (account or customer name with which the retail forex transaction was effected) Start Printed Page 21032 (ii) Order number (iii) Type of order (market order, limit order, or subject to special instructions) (iv) Date and time, to the nearest minute, the retail forex transaction order was received (as evidenced by timestamp or other timing device) (v) Time, to the nearest minute, the retail forex transaction order was executed and (vi) Price at which the retail forex transaction was executed. (2) Post-execution allocation of bunched orders. Specific identifiers for retail forex accounts included in bunched orders need not be recorded at time of order placement or upon report of execution as required under paragraph (e)(1) of this section if the following requirements are met: (i) The banking institution placing and directing the allocation of an order eligible for post-execution allocation has been granted written investment discretion with regard to participating customer accounts and makes the following information available to customers upon request: (A) The general nature of the post-execution allocation methodology the banking institution will use (B) Whether the banking institution has any interest in accounts which may be included with customer accounts in bunched orders eligible for post-execution allocation and (C) Summary or composite data sufficient for that customer to compare the customers results with those of other comparable customers and, if applicable, any account in which the banking institution has an interest. (ii) Post-execution allocations are made as soon as practicable after the entire transaction is executed (iii) Post-execution allocations are fair and equitable, with no account or group of accounts receiving consistently favorable or unfavorable treatment and (iv) The post-execution allocation methodology is sufficiently objective and specific to permit the Board to verify fairness of the allocations using that methodology. (f) Record of monthly statements and confirmations. A banking institution shall retain a copy of each monthly statement and confirmation required by sectthinsp240.10. (g) Form of record and manner of maintenance. The records required by this section must clearly and accurately reflect the information required and provide an adequate basis for the audit of the information. A banking institution must create and maintain audio recordings of oral orders and oral offset instructions. Record maintenance may include the use of automated or electronic records provided that the records are easily retrievable, and readily available for inspection. (h) Length of maintenance. A banking institution shall keep each record required by this section for at least five years from the date the record is created. (a) Capital required for a state member bank. A banking institution defined in section 240.2(b)(1) offering or entering into retail forex transactions must be well-capitalized as defined in section 208.43 of Regulation H (12 CFR 208.43 ). (b) Capital required for an uninsured state-licensed branch of a foreign bank. A banking institution defined in sectthinsp240.2(b)(2) offering or entering into retail forex transactions must be well-capitalized under the capital rules made applicable to it pursuant to sectthinsp225.2(r)(3) of Regulation Y (12 CFR 225.2 (r)(3)). (c) Capital required for financial holding companies and bank holding companies. A banking institution defined in sectthinsp240.2(b)(3) or (4) offering or entering into retail forex transactions must be well-capitalized as defined in sectthinsp225.2(r) of Regulation Y (12 CFR 225.2 (r)). (d) Capital required for savings and loan holding companies. A banking institution defined in sectthinsp240.2(b)(5) offering or entering into retail forex transactions must be well-capitalized as defined in sectthinsp238.2(s) of Regulation LL (12 CFR 238.2 (s)). (e) Capital required for an agreement corporation or Edge Act corporation. A banking institution defined in sectthinsp240.2(b)(6) or (7) offering or entering into retail forex transactions must maintain capital in compliance with the capital adequacy guidelines that are made applicable to an Edge corporation engaged in banking pursuant to sectthinsp211.12 (c)(2) of Regulation K (12 CFR 211.12 (c)(2)). (a) Margin required. A banking institution engaging, or offering to engage, in retail forex transactions must collect from each retail forex customer an amount of margin not less than: (1) Two percent of the notional value of the retail forex transaction for major currency pairs and 5 percent of the notional value of the retail forex transaction for all other currency pairs (2) For short options, 2 percent for major currency pairs and 5 percent for all other currency pairs of the notional value of the retail forex transaction, plus the premium received by the retail forex customer or (3) For long options, the full premium charged and received by the banking institution. (b)(1) Form of margin. Margin collected under paragraph (a) of this section or pledged by a retail forex customer for retail forex transactions in excess of the requirements of paragraph (a) of this section must be in the form of cash or the following financial instruments: (i) Obligations of the United States and obligations fully guaranteed as to principal and interest by the United States (ii) General obligations of any State or of any political subdivision thereof (iii) General obligations issued or guaranteed by any enterprise, as defined in 12 U. S.C. 4502 (10) (iv) Certificates of deposit issued by an insured depository institution, as defined in section 3(c)(2) of the Federal Deposit Insurance Act (12 U. S.C. 1813 (c)(2)) (v) Commercial paper (vi) Corporate notes or bonds (vii) General obligations of a sovereign nation (viii) Interests in money market mutual funds and (ix) Such other financial instruments as the Board deems appropriate. (2) Haircuts. A banking institution shall establish written policies and procedures that include: (i) Haircuts for noncash margin collected under this section and (ii) Annual evaluation, and, if appropriate, modification of the haircuts. (c) Major currencies. (1) for the purposes of paragraphs (a)(1) and (a)(2) of this section, major currency means: (i) United States Dollar (USD) (ii) Canadian Dollar (CAD) (iv) United Kingdom Pound (GBP) (v) Japanese Yen (JPY) (vi) Swiss Franc (CHF) (vii) New Zealand Dollar (NZD) (viii) Australian Dollar (AUD) (ix) Swedish Kronor (SEK) (x) Danish Kroner (DKK) (xi) Norwegian Krone (NOK), and (xii) Any other currency as determined by the Board. (d) Margin calls liquidation of position. For each retail forex customer, at least once per day, a banking institution shall: (1) Mark the value of the retail forex customers open retail forex positions to market (2) Mark the value of the margin collected under this section from the retail forex customer to market (3) Determine whether, based on the marks in paragraphs (d)(1) and (d)(2) of Start Printed Page 21033 this section, the banking institution has collected margin from the retail forex customer sufficient to satisfy the requirements of this section and (4) If, pursuant to paragraph (d)(3) of this section, the banking institution determines that it has not collected margin from the retail forex customer sufficient to satisfy the requirements of this section then, within a reasonable period of time, the banking institution shall either: (i) Collect margin from the retail forex customer sufficient to satisfy the requirements of this section or (ii) Liquidate the retail forex customers retail forex transactions. Required reporting to customers. (a) Monthly statements. Each banking institution must promptly furnish to each retail forex customer, as of the close of the last business day of each month or as of any regular monthly date selected, except for accounts in which there are neither open positions at the end of the statement period nor any changes to the account balance since the prior statement period, but in any event not less frequently than once every three months, a statement that clearly shows: (1) For each retail forex customer: (i) The open retail forex transactions with prices at which acquired (ii) The net unrealized profits or losses in all open retail forex transactions marked to the market (iii) Any money, securities or other property held as margin for retail forex transactions and (iv) A detailed accounting of all financial charges and credits to the retail forex customers retail forex accounts during the monthly reporting period, including: money, securities, or property received from or disbursed to such customer realized profi ts and losses and fees, charges, and commissions. (2) For each retail forex customer engaging in retail forex transactions that are options: (i) All such options purchased, sold, exercised, or expired during the monthly reporting period, identified by underlying retail forex transaction or underlying currency, strike price, transaction date, and expiration date (ii) The open option positions carried for such customer and arising as of the end of the monthly reporting period, identified by underlying retail forex transaction or underlying currency, strike price, transaction date, and expiration date (iii) All such option positions marked to the market and the amount each position is in the money, if any (iv) Any money, securities or other property held as margin for retail forex transactions and (v) A detailed accounting of all financial charges and credits to the retail forex customers retail forex accounts during the monthly reporting period, including: money, securities, or property received from or disbursed to such customer realiz ed profits and losses premiums and mark-ups and fees, charges, and commissions. (b) Confirmation statement. Each banking institution must, not later than the next business day after any retail forex transaction, send: (1) To each retail forex customer, a written confirmation of each retail forex transaction caused to be executed by it for the customer, including offsetting transactions executed during the same business day and the rollover of an open retail forex transaction to the next business day (2) To each retail forex customer engaging in forex option transactions, a written confirmation of each forex option transaction, containing at least the following information: (i) The retail forex customers account identification number (ii) A separate listing of the actual amount of the premium, as well as each mark-up thereon, if applicable, and all other commissions, costs, fees and other charges incurred in connection with the forex option transaction (iii) The strike price (iv) The underlying retail forex transaction or underlying currency (v) The final exercise date of the forex option pur chased or sold and (vi) The date the forex option transaction was executed. (3) To each retail forex customer engaging in forex option transactions, upon the expiration or exercise of any option, a written confirmation statement thereof, which statement shall include the date of such occurrence, a description of the option involved, and, in the case of exercise, the details of the retail forex or physical currency position which resulted therefrom including, if applicable, the final trading date of the retail forex transaction underlying the option. (c) Notwithstanding the provisions of paragraphs (b)(1) through (3) of this section, a retail forex transaction that is caused to be executed for a pooled investment vehicle that engages in retail forex transactions need be confirmed only to the operator of such pooled investment vehicle. (d) Controlled accounts. With respect to any account controlled by any person other than the retail forex customer for whom such account is carried, each banking institution shall promptly furnish in writing to such other person the information required by paragraphs (a) and (b) of this section. (e) Introduced accounts. Each statement provided pursuant to the provisions of this section must, if applicable, show that the account for which the banking institution was introduced by an introducing broker and the name of the introducing broker. (a) No implication or representation of limiting losses. No banking institution engaged in retail foreign exchange transactions or its related persons may imply or represent that it will, with respect to any retail customer forex account, for or on behalf of any person: (1) Guarantee such person or account against loss (2) Limit the loss of such person or account or (3) Not call for or attempt to collect margin as established for retail forex customers. (b) No implication of representation of engaging in prohibited acts. No banking institution or its related persons may in any way imply or represent that it will engage in any of the acts or practices described in paragraph (a) of this section. (c) No Federal government endorsement. No banking institution or its related persons may represent or imply in any manner whatsoever that any retail forex transaction or retail forex product has been sponsored, recommended, or approved by the Board, the Federal government, or any agency thereof. (d) Assuming or sharing of liability from bank error. This section shall not be construed to prevent a banking institution from assuming or sharing in the losses resulting from the banking institutions error or mishandling of a retail forex transaction. (e) Certain guaranties unaffected. This section shall not affect any guarantee entered into prior to the effective date of this part, but this section shall apply to any extension, modification or renewal thereof entered into after such date. Authorization to trade. (a) Specific authorization required. No banking institution may directly or indirectly effect a retail forex transaction for the account of any retail forex customer unless, before the transaction occurs, the retail forex customer specifically authorized the banking institution to effect the retail forex transaction. (b) A retail forex transaction is ldquospecifically authorizedrdquo for purposes Start Printed Page 21034 of this section if the retail forex customer specifies: (1) The precise retail forex transaction to be effected (2) The exact amount of the foreign currency to be purchased or sold and (3) In the case of an option, the identity of the foreign currency or contract that underlies the option. Trading and operational standards. (a) Internal rules, procedures, and controls required. A banking institution engaging in retail forex transactions shall establish and implement internal rules, procedures, and controls designed, at a minimum, to: (1) Ensure, to the extent reasonable, that each order received from a retail forex customer that is executable at or near the price that the banking institution has quoted to the customer is entered for execution before any order in any retail forex transaction for: (i) A proprietary account (ii) An account in which a related person has an interest, or any account for which such a related person may originate orders without the prior specific consent of the account owner, if the related person has gained knowledge of the retail forex customers order prior to the transmission of an order for a proprietary account (iii) An account in which a related person has an interest, if the related person has gained knowledge of the retail forex customers order prior to the transmission of an order for a proprietary account or (iv) An account in which a related person may originate orders without the prior specific consent of the account owner, if the related person has gained knowledge of the retail forex customers order prior to the transmission of an order for a proprietary account (2) Prevent banking institution related persons from placing orders, directly or indirectly, with another person in a manner designed to circumvent the provisions of paragraph (a)(1) of this section and (3) Fairly and objectively establish settlement prices for retail forex transactions. (b) Disclosure of retail forex transactions. No banking institution engaging in retail forex transactions may disclose that an order of another person is being held by the banking institution, unless the disclosure is necessary to the effective execution of such order or the disclosure is made at the request of the Board. (c) Handling of retail forex accounts of related persons of retail forex counterparties. No banking institution engaging in retail forex transactions shall knowingly handle the retail forex account of any related person of another retail forex counterparty unless the banking institution: (1) Receives written authorization from a person designated by such other retail forex counterparty with responsibility for the surveillance over such account (2) Prepares immediately upon receipt of an order for the account a written record of the order, including the account identification and order number, and records thereon to the nearest minute, by time-stamp or other timing device, the date and time the order is received and (3) Transmits on a regular basis to the other retail forex counterparty copies of all statements for the account and of all written records prepared upon the receipt of orders for the account pursuant to paragraph (c)(2) of this section. (d) Related person of banking institution establishing account at another retail forex counterparty. No related person of a banking institution working in the banking institutions retail forex business may have an account, directly or indirectly, with another retail forex counterparty unless the other retail forex counterparty: (1) Receives written authorization to open and maintain the account from a person designated by the banking institution of which it is a related person with responsibility for the surveillance over the account pursuant to paragraph (a)(2) of this section (2) Prepares immediately upon receipt of an order for the account a written record of the order, including the account identification and order number, and records thereon to the nearest minute, by time-stamp or other timing device, the date and time the order is received and (3) Transmits on a regular basis to the banking institution copies of all statements for the account and of all written records prepared by the other retail forex counterparty upon receipt of orders for such account pursuant to paragraph ( d)(2) of this section. (e) Prohibited trading practices. No banking institution engaging in retail forex transactions may: (1) Enter into a retail forex transaction, to be executed pursuant to a market or limit order at a price that is not at or near the price at which other retail forex customers, during that same time period, have executed retail forex transactions with the banking institution (2) Adjust or alter prices for a retail forex transaction after the transaction has been confirmed to the retail forex customer (3) Provide a retail forex customer a new bid price for a retail forex transaction that is higher than its previous bid without providing a new asked price that is also higher than its previous asked price by a similar amount (4) Provide a retail forex customer a new bid price for a retail forex transaction that is lower than its previous bid without providing a new asked price that is also lower than its previous asked price by a similar amount or (5) Establish a new position for a retail forex customer (except one that off sets an existing position for that retail forex customer) where the banking institution holds outstanding orders of other retail forex customers for the same currency pair at a comparable price. (a) Supervision by the banking institution. A banking institution engaging in retail forex transactions shall diligently supervise the handling by its officers, employees, and agents (or persons occupying a similar status or performing a similar function) of all retail forex accounts carried, operated, or advised by the banking institution and all activities of its officers, employees, and agents (or persons occupying a similar status or performing a similar function) relating to its retail forex business. (b) Supervision by officers, employees, or agents. An officer, employee, or agent of a banking institution must diligently supervise his or her subordinates handling of all retail forex accounts at the banking institution and all the subordinates activities relating to the banking institutions retail forex business. Notice of transfers. (a) Prior notice generally required. Except as provided in paragraph (b) of this section, a banking institution must provide a retail forex customer with 30 days prior notice of any assignment of any position or transfer of any account of the retail forex customer. The notice must include a statement that the retail forex customer is not required to accept the proposed assignment or transfer and may direct the banking institution to liquidate the positions of the retail forex customer or transfer the account to a retail forex counterparty of the retail forex customers selection. (b) Exceptions. The requirements of paragraph (a) of this section shall not apply to transfers: Start Printed Page 21035 (1) Requested by the retail forex customer (2) Made by the Federal Deposit Insurance Corporation as receiver or conservator under the Federal Deposit Insurance Act or other law or (3) Otherwise authorized by applicable law. (c) Obligations of transferee banking institution. A banking institution to which retail forex accounts or positions are assigned or transferred under paragraph (a) of this section must provide to the affected retail forex customers the risk disclosure statements and forms of acknowledgment required by this part and receive the required signed acknowledgments within sixty days of such assignments or transfers. This requirement shall not apply if the banking institution has clear written evidence that the retail forex customer has received and acknowledged receipt of the required disclosure statements. Customer dispute resolution. (a) No banking institution shall enter into any agreement or understanding with a retail forex customer in which the customer agrees, prior to the time a claim or grievance arises, to submit any claim or grievance regarding any retail forex transaction or disclosure to any settlement procedure. (b) Election of forum. (1) Within 10 business days after the receipt of notice from the retail forex customer that the customer intends to submit a claim to arbitration, the banking institution shall provide the customer with a list of persons qualified in dispute resolution. (2) The customer must, within 45 days after receipt of such list, notify the banking institution of the person selected. The customers failure to provide such notice shall give the banking institution the right to select a person from the list. (c) Enforceability. A dispute settlement procedure may require parties using the procedure to agree, under applicable state law, submission agreement, or otherwise, to be bound by an award rendered in the procedure if the agreement to submit the claim or grievance to the procedure was made after the claim or grievance arose. Any award so rendered by the procedure will be enforceable in accordance with applicable law. (d) Time limits for submission of claims. The dispute settlement procedure used by the parties may not include any unreasonably short limitation period foreclosing submission of a customers claims or grievances or counterclaims. (e) Counterclaims. A procedure for the settlement of a retail forex customers claims or grievances against a banking institution or employee thereof may permit the submission of a counterclaim in the procedure by a person against whom a claim or grievance is brought if the counterclaim: (1) Arises out of the transaction or occurrence that is the subject of the retail forex customers claim or grievance and (2) Does not require for adjudication the presence of essential witnesses, parties, or third persons over which the settlement process lacks jurisdiction. (f) Cross-border transactions. This section shall not apply to transactions within the scope of sections 202, 302, and 305 of the Federal Arbitration Act (9 U. S.C. 202. 302, and 305). Reservation of authority. The Board may modify the disclosure, recordkeeping, capital and margin, reporting, business conduct, documentation, or other standards or requirements under this part for a specific retail forex transaction or a class of retail forex transactions if the Board determines that the modification is consistent with safety and soundness and the protection of retail forex customers. End Part Start Signature By order of the Board of Governors of the Federal Reserve System, April 3, 2013. Margaret McCloskey Shanks, Deputy Secretary of the Board. End Signature End Supplemental Information 2. thinspDodd-Frank Act sectthinsp742(c)(2) (codified at 7 U. S.C. 2 (c)(2)(E) (2011). 3. thinspThe CEA defines ldquofinancial institutionrdquo to include an agreement corporation, an Edge Act corporation, a depository institution (as defined in section 3 of the Federal Deposit Insurance Act), a financial holding company (as defined in section 2 of the Bank Holding Company Act of 1956), a trust company, or ldquoa similarly regulated subsidiary or affiliate of an entityrdquo described above. 7 U. S.C. 1 a(21). 4. thinspFor purposes of the retail forex rules, ldquoFederal regulatory agencyrdquo includes ldquoan appropriate Federal banking agency. rdquo 7 U. S.C. 2 (c)(2)(E)(i)(III). The Board is an ldquoappropriate Federal banking agencyrdquo under the CEA. 7 U. S.C. 1 a(2). 5. thinspA retail customer is a person who is not an ldquoeligible contract participantrdquo under the CEA. See, 7 U. S.C. 1 a(18). 10. thinspThe Boards proposed rule did not expl icitly cover savings and loan holding companies (SLHCs). They have been added to the regulation to reflect the transfer to the Board of regulatory responsibility for SLHCs on July 21, 2011. 11. thinsp Regulation of Off-Exchange Retail Foreign Exchange Transactions and Intermediaries, 75 FR 55409 (Sept. 10, 2010) (Final CFTC Retail Forex Rule). The CFTC proposed these rules prior to the enactment of the Dodd-Frank Act. Regulation of Off-Exchange Retail Foreign Exchange Transactions and Intermediaries, 75 FR 3281 (Jan. 20, 2010) (Proposed CFTC Retail Forex Rule). 13. thinsp7 U. S.C. 2 (c)(2)(E). The federal regulatory authorities other than the Board are the CFTC, OCC, FDIC, the Securities and Exchange Commission, the National Credit Union Association, and the Farm Credit Administration. 14. thinspThe definition of ldquoeligible contract participantrdquo is found in section 1a(18) of the CEA and is discussed below. 17. thinsp See generally, CFTC v. Intl Fin. Servs. (New York), Inc., 323 F. Supp. 2d 482, 495 (S. D.N. Y. 2004) (distinguishing between foreign exchange futures contracts and spot contracts in foreign exchange, and noting that foreign currency trades settled within two days are ordinarily spot transactions rather than futures contracts) see also Bank Brussels Lambert v. Intermetals Corp., 779 F. Supp. 741, 748 (S. D.N. Y. 1991). 18. thinsp See generally, CFTC v. Intl Fin. Servs. (New York), Inc., 323 F. Supp. 2d 482, 495 (S. D.N. Y. 2004) (distinguishing between forward contracts in foreign exchange and foreign exchange futures contracts) see also William L. Stein, The Exchange-Trading Requirement of the Commodity Exchange Act, 41 Vand. L. Rev. 473, 491 (1988). In contrast to forward contracts, futures contracts generally include several or all of the following characteristics: (i) Standardized nonnegotiable terms (other than price and quantity) (ii) parties are required to deposit initial margin to secure their obligations under the contract (iii) parties are obligated and entitled to pay or receive variation margin in the amount of gain or loss on the position periodically over the period the contract is outstanding (iv) purchasers and sellers are permitted to close out their positions by selling or purchasing offsetting contracts and (v) settlement may be provided for by either (a) cash payment through a clearing entity that acts as the counterparty to both sides of the contract without delivery of the underlying commodity or (b) physical delivery of the underlying commodity. See, Edward F. Greene et al. U. S. Regulation of International Securities and Derivatives Markets sectthinsp14.082 (8th ed. 2006). 20. thinsp CFTC v. Zelener, 373 F.3d 861 (7th Cir. 2004) see also CFTC v. Erskine, 512 F.3rd 309 (6th Cir. 2008). 21. thinspFor example, in Zelener, the retail forex dealer retained the right, at the date of delivery of the currency to deliver the currency, roll the transaction over, or offset all or a portion of the transaction with another open position held by the customer. See CFTC v. Zelener, 373 F.3d 861, 869 (7th Cir. 2004). 22. thinsp See, e. g. CFTC v. Erskine, 512 F.3d 309, 326 (6th Cir. 2008) CFTC v. Zelener, 373 F.3d 861, 869 (7th Cir. 2004). 23. thinspThe term ldquoeligible contract participantrdquo is defined at 7 U. S.C. 1 a(18) and generally requires a corporation, partnership, proprietorship, organization, trust or other entity to have total assets exceeding 10 million and an individual to have more than 10 million in assets invested on a discretionary basis. 24. thinsp Further Definition of ldquoSwap Dealer, rdquo ldquoSecurity-Based Swap Dealer, rdquo ldquoMajor Swap Participantrdquo and ldquoEligible Contract Participant, rdquo 75 FR 80174 (December 21, 2010)(joint proposed rule with the SEC). 35. thinsp See National Futures Association, Forex Transaction: A Regulatory Guide 17 (Feb. 2011) New York Federal Reserve Bank, Survey of North American Foreign Exchange Volume tbl. 3e (Jan. 2011) Bank for International Settlements, Report on Global Foreign Exchange Market Activity in 2010 at 15 tbl. B.6 (Dec. 2010). 36. thinspSee 17 CFR 166.5. The CFTCs regulation permits predispute dispute settlement agreements with a customer with certain restrictions such as that signing the agreement must not be made a condition for the customer to utilize the services offered by the CFTC registrant. 37. thinspConvention on the Recognition and Enforcement of Foreign Arbitral Awards (1970). 38. thinspInter-American Convention on International Commercial Arbitration (1990). 39. thinsp9 U. S.C. 1 et seq. Chapter 2 of the FAA (secs. 201-208) contains provisions implementing the New York Convention, while Chapter 3 of the FAA (secs. 301mdash307) contains provisions implementing the Panama Convention. 40. thinsp See SR Letter 94-11 (Feb. 17, 1994) see also SR Letter 95-46 (Sept. 14, 1995). 41. thinspU. S. Small Business Administration, Table of Small Business Size Matched to North American Industry Classification System Codes, 13 CFR 121.201 . FR Doc. 2013-08163 Filed 4-8-13 8:45 am BILLING CODE 6210-01-POff-Exchange Forex Regulation On September 10, 2010, the CFTC approved its final rules regarding off-exchange retail foreign exchange transactions. Although the rulemaking pre-dated the Dodd-Frank Act. once the Act was signed in July 2010, the commissions forex rules, along with the forex rules of other regulatory authorities, became a part of Dodd-Frank. Under Dodd-Frank, the CFTC will have jurisdiction over retail foreign exchange transactions, except in the case of entities which fall under the authority of one of the following regulatory agencies (Prudential Regulators ): The Act requires that such rules include appropriate requirements with respect to disclosure, record keeping, capital and margin, reporting, business conduct, documentation, and any other standards or requirements as Federal regulatory agencies shall determine to be necessary. CFTC Final Rule: Off-Exchange Retail Forex The Commissions final rules closely mirrored those of the proposed rules from January, 2010: The CFTC rule primarily addresses the amount of leverage retail traders can employ in trading off-exchange currencies. The rule allows for a maximum of 50 to 1 leverage, or a 2 percent margin requirement on major currency pairs, and a 20 to 1 maximum leverage on all other forex transactions, or a 5 percent requirement. This was the major deviation from the proposed rule, which limited leverage to a 10 to 1 ratio. The proposed requirement that a person who registers as an Introducing Broker (IB) to introduce retail forex accounts must be guaranteed by a registered FCM or Retail Foreign Exchange Dealer (RFED) (and that the IB could be guaranteed by only one FCM or RFED) was replaced with the same requirement that currently applies to IBs who introduce futures and commodity interest accounts. A forex IB may choose either to meet the minimum net capital requirements applicable to futures and commodity options IBs, or to enter into a guarantee agreement with an FCM or an RFED. FCMs, or RFEDs must also maintain a net capital of 20 million, plus 5 percent of the amount, if any, by which retail forex customer liabilities exceed 10 million. The NFA is authorized to set specific security deposit levels within those parameters, and is required to review periodically and adjust as necessary both the particular security deposit levels and the designation of which currencies are major currencies, in light of such factors as changes in volatility. The final rules retain the requirement for RFEDs and FCMs that engage in retail forex transactions to disclose on a quarterly basis the percentage of non-discretionary accounts that realized a profit and to keep and make available records of that calculation. 1 The rules went into effect on October 18, 2010. In early 2011, prudential regulators submitted proposed rules and requests for comment on forex regulation. While these proposals generally mirror the CFTC Final Rule, minor differences such as dispute resolution vary among regulators. Documents related to these rule proposals can be found below, under Prudential Regulators Forex Regulation . Retail Transaction Definitions A retail forex customer is generally defined by the CFTC as: An individual with less than 10 million in total assets, or less than 5 million in total assets if entering into the transaction to manage risk, and is not registered as a futures or securities profession. Companies, other than financial institutions and investment companies, with less than 10 million in total assets, or a net worth less than 1 million if entering into the transaction in connection with the conduct of their businesses and commodity pools with less than 5 million in total assets. Counterparties According to the Dodd-Frank Act. the list of eligible companies who may serve as counterparties to off-exchange retail forex transaction, only U. S. financial institutions are allowed to act as counterparties. Insurance companies are no longer allowed to participate as counterparties. Regulatory Jurisdiction The CFTC stated that regulation of the retail forex space depends on the type of firm which will act as a counterparty. If an SEC registered broker or dealer is handling retail forex will be regulated by that agency. Financial institutions will be regulated by banking regulators (see Prudential Regulators Forex Proposals below). The CFTC has jurisdiction over FCMs. RFEDs, or entities not otherwise regulated. None of the provisions have any impact on exchange-traded forex contracts. CFTC Guidance to Forex Commodity Trading Advisors and Commodity Pool Operators. February 27, 2012 On February 27, 2012, the CFTC Division od Swap Dealer and Intermediary Oversight issued a letter of guidance to the National Futures Association (NFA) regarding the CFTC Retail Forex rules and performance disclosure by CPOs and CTAs. According to the letter: It is the Divisions view. that a Forex CTA is required to disclose past performance for the period beginning October 18, 2010, or, if later, the date on which the Forex CTA first began exercising discretionary trading authority over accounts engaged in retail forex transactions. From and after October 18, 2015, the period of time described in Regulation 4.35(a)(5) (five most recent calendar years and year-to-date or life of the trading program, if shorter) would apply. If a Forex CTA elects to include in its Disclosure Document past performance information for any time prior to October 18, 2010, we believe that in order to avoid cherry picking the presentation of such information should encompass the entire period set forth in Regulation 4.35(a)(5) and should include all of the accounts over which the Forex CTA exercised discretionary trading authority during that period. The full text of the letter can be found below. Prudential Regulators Forex Rules Final Rule, Office of the Comptroller of the Currency (OCC), July 14, 2011 On July 14, 2011, the Federal Register published a final rule from the OCC regarding the authorization of national banks, federal branches and agencies of foreign banks, and their operating subsidiaries (collectively, national banks) to engage in certain off-exchange transactions in foreign currency with retail customers. According to the final rule, such a retail transaction is defined as a transaction in foreign currency between a national bank and a retail customer that is: a future or option on such a future an option not traded or executed on a registered national securities exchange or a certain leveraged or margined transaction. The rule became effective on July 15, 2011. Additionally, as mandated in the Dodd-Frank Act. on July 21, 2011, the OCC replaced the Office of Thrift Supervision as the appropriate Federal banking agency for Federal savings associations. A separate order addressing the expansion of the rules to Federal savings associations appeared in the Federal Register on September 12, 2011. 2 The requirements are similar to the Final Rule Regulating Off Exchange Retail Foreign Exchange Transactions from the CFTC, September 10, 2010. The deadline for public comment was May 23, 2011. The final rulemaking, as it appeared in the Federal Register on July 14, 2011, can be found below. Final Rule, FDIC, July 8, 2011 On May 10, 2011, the Federal Deposit Insurance Corporation (FDIC) issued a rule proposal regarding retail forex transactions engaged in by insured depository institutions (IDIs) under FDIC authority. Under the proposed rule, retail customers with relationships with a bank, and are not cleared through an exchange, will be required to post a margin of 2 percent in major currencies such as the U. S. dollar, yen or euro. The margin amount would rise to 5 percent of the notional value of the transaction on other currencies, according to a Reuters story on the FDIC rule. This rule does not affect large companies, only retail customers who are defined as individuals with less than 10 million in assets. 3 The final rule applies to foreign currency futures, options on futures, and options as these terms are used in the Commodity Exchange Act. The rule would also apply to transactions that are functionally or economically similar to futures and options, such as rolling spot trades. Highlights of the rule: FDIC-supervised IDIs entering into trades covered by the rule would be subject to requirements in six areas: disclosure, recordkeeping, capital and margin, reporting, business conduct, and documentation. The requirements focus on safety and soundness and consumer protection. Traditional spot and forward contracts would not be covered by this rule. The rule would only apply to covered transactions with a retail customer. For purposes of the rule, a retail customer may include certain small businesses. It may also include an individual with 10 million or less invested on a discretionary basis and who is not using the trades to reduce risks associated with other investments. FDIC-supervised IDIs engaged in or that wish to engage in transactions covered by the rule would be required to submit a detailed business plan, demonstrate board approval of the activity, and obtain written approval from the FDIC to provide such products, among other requirements. FDIC-supervised IDIs engaged in this or any sales or marketing of any investment products should continue to meet the expectations set out in the 1994 Interagency Statement on Retail Sales of Nondeposit Investment Products to the extent such expectations do not conflict with the requirements of the final rule. 4 Federal Reserve Rule Proposal, July 28, 2011 The Federal Reserve issued its rule proposal and request for public comment on July 28, 2011. The comment deadline is October 11, 2011. To submit a comment click here. The proposal is modeled, in general, after the CFTC Final Rule on Off-Exchange Forex (see above), with a few key differences: The proposal does not include registration requirements, because banking institutions are already subject to comprehensive supervision by the Board. Thus, instead of a registration requirement, banking institutions must provide 60 days notice to the Board to conduct a retail forex business. Because banking institutions are already subject to various capital and other supervisory requirements, the Boards proposed retail forex rule generally requires banking institutions wishing to engage in retail forex transactions to be well capitalized. The proposed rule would require that the risk disclosure statement highlight that a retail forex transaction is not insured by the FDIC. The CFTCs regulations do not address FDIC insurance because no financial intermediaries under the CFTCs jurisdiction are insured depository institutions. The Board is not proposing to require a separate retail forex margin account, but is requesting comment on whether these prohibitions would be appropriate. OCC and FDIC forex rules, will require such separation. Similar to the FDIC rule above, the Feds proposal would bar the use of mandatory pre-dispute arbitration agreements. In contrast, the FDIC and OCC rules permit the use of pre-dispute arbitration. Related Documents: CFTC, FDIC, OCC, Federal Reserve Rules as Entered into the Federal Register CFTC Interpretive Guidance to Forex CTAs
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