View Rule

The Commodity Futures Trading Commission (CFTC or Commission) proposed amendments to regulations set forth in part 38 to address the potential risk of a designated contract market’s (DCM) trading platform experiencing a disruption or system anomaly due to electronic trading. The regulations consisted of three principles applicable to DCMs concerning: (i) the implementation of exchange rules applicable to market participants to prevent, detect, and mitigate market disruptions and system anomalies associated with electronic trading; (ii) the implementation of exchange-based pre-trade risk controls for all electronic orders; and (iii) the prompt notification of the Commission by DCMs of any significant disruptions to their electronic trading platforms. The regulations were accompanied by acceptable practices (Acceptable Practices), which provided that a DCM can comply with these principles by adopting and implementing rules and risk controls that are reasonably designed to prevent, detect, and mitigate market disruptions and system anomalies associated with electronic trading.  The Final Rule was published in the Federal Register on January 11, 2021.