The Commodity Futures Trading Commission has requested public comment on a petition for exemptive relief filed by Hard Eight Futures, LLC, a registered commodity trading advisor, pursuant to Section 4(c) of the Commodity Exchange Act (CEA). The requested relief would permit persons qualifying as “eligible contract participants” (ECPs), as defined in Section 1a(12) of the CEA, to trade foreign-listed security index futures contracts on broad-based indices without a prior grant of no-action relief to the listing exchange. Currently, such contracts may only be offered and sold to U.S. persons (including ECPs) after the listing exchange has received no-action relief.
The relief requested in the petition would be limited to indices of which the underlying securities are principally traded on, by or through a non-U.S. market, and would be further conditioned upon the existence of a Memorandum of Understanding between the CFTC and the regulator of the listing exchange. If the petition were granted in its current form, ECPs seeking to rely upon this relief would be required to file a notice containing certain specified information regarding such ECP and the relevant contract to be traded with the CFTC, and the exemption would then take effect 10 business days thereafter (absent CFTC objection).
In its request for comment, the CFTC has raised several questions regarding the petition, including whether additional conditions should be imposed upon the requested relief. Comments must be submitted by July 19.
The CFTC’s request for comment is available here.