Co-authored by Blake J. Brockway.
On April 30, CME Group issued a Market Regulation Advisory Notice related to the termination of its previously issued temporary waiver of the otherwise required annual application for exemptions from position limits. Pursuant to CME Group Rule 559, a person who has been authorized to exceed position limits must file an updated application on an annual basis. On December 20, 2011, CME Group issued a temporary waiver of this requirement in anticipation of the CFTC’s new position limit rules, which would separately require market participants to submit applications for exemptions. The temporary waiver is set to expire on May 31, 2012. CME Group is not offering an extension to the waiver, because the majority of the CFTC’s position limit and exemption regulations have not become effective and the effective date is not yet known.
Market participants that are currently operating under an exemption from speculative position limits that would have expired on or before May 31 must submit updated position limit exemption applications by May 31 in order to continue holding positions that exceed the speculative position limit after that date. Any market participant that relied on the temporary waiver and has not filed an updated annual application due between December 20, 2011 and May 31, 2012, must file such an application no later than May 31, 2012.
Notwithstanding the termination of the temporary waiver, all market participants currently operating under the terms of an Exchange-granted exemption from speculative position limits remain bound by, and must comply with, all relevant terms and conditions of such exemptions and Exchange rules.
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