CFTC Delays Speculative Trading Curb Vote to Oct. 18 Meeting
The U.S. Commodity Futures Trading Commission has delayed consideration of Dodd-Frank Act rules seeking to limit speculation in oil, natural gas and other commodities until an Oct. 18 Washington meeting, said Steve Adamske, CFTC spokesman.
The so-called position-limits rule, which already was delayed once, had been on the schedule for consideration at a meeting Oct. 4. The rule has been among the most contentious aspects of Dodd-Frank, the financial-overhaul enacted in July 2010, and has spurred more than 13,000 letters to the CFTC from supporters such as Delta Air Lines Inc. (DAL) and opponents including Barclays Capital.
“I continue to be troubled by the pace of implementing position limits as Congress has directed. These limits were supposed to be in place earlier this year,” Bart Chilton, a Democrat on the five-member commission, said in a statement. “I suggested in January that we move forward with spot month limits and limits for on-exchange trading on other and aggregate months. There is no reason we can’t do those now.”
The CFTC has canceled the Oct. 4 meeting and also delayed consideration of rules governing clearinghouses that stand between buyers and sellers of derivatives, Adamske said.
The CFTC and Securities and Exchange Commission are leading U.S. efforts to write new derivatives regulations after largely unregulated trades helped fuel the 2008 credit crisis. The agency has proposed more than 40 rules and has begun to hold final votes on regulations. The agency has missed Dodd-Frank’s mid-July deadline to complete most rules, and Gary Gensler, CFTC chairman, said some rules will be finished in the first quarter of 2012.
The rules will govern trades conducted by JPMorgan Chase & Co. (JPM), Goldman Sachs Group Inc. (GS) and Cargill Inc. CME Group Inc. (CME), the world’s largest futures exchange, has criticized the agency’s proposal on position limits and said the agency doesn’t have the data necessary to impose the trading curbs.
The agency’s proposals on position limits and derivatives exchanges “often represent an overstepping of the commission’s authority” under Dodd-Frank, Terrence Duffy, executive chairman of CME, said in testimony prepared for an April 12 Senate Banking Committee hearing.
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