§ 6c. Prohibited transactions

Footnotes

1. 1 So in original. Probably should be “clause”.

Legislative history

Reconstructed from this section’s Code source credit and amendment notes, resolved against the local Statutes at Large. Editorial notes are evidence, not the law that made the change.

1. 1922

   Sept. 21, 1922, ch. 369, § 4c, as added June 15, 1936, ch. 545, § 5, 49 Stat. 1494 · 49 Stat. 1494

   Enacted · 7 U.S.C. § 6c

   Sept. 21, 1922, ch. 369, § 4c, as added June 15, 1936, ch. 545, § 5, 49 Stat. 1494

   Source evidence

   Code source credit
   Sept. 21, 1922, ch. 369, § 4c, as added June 15, 1936, ch. 545, § 5, 49 Stat. 1494

2. 1974

   Commodity Futures Trading Commission Act of 1974

   Pub. L. 93–463 title I § 103(a) · 88 Stat. 1389

   1. Inserted · 7 U.S.C. § 6c(a)

      Pub. L. 93–463, §§ 103(a), 402(a), (b), (d), designated existing provisions as subsec. (a), in par. (B) of subsec. (a) as so designated inserted “if such transaction involves any commodity specifically set forth in section 2(a) of this title, prior to the enactment of the Commodity Futures Trading Commission Act of 1974, and” and “option”, and in provisions following par. (C)

   2. Struck · 7 U.S.C. § 6c(a)

      Pub. L. 93–463, §§ 103(a), 402(a), (b), (d), struck out provisions prohibiting a construction of this section or section 6b of this title which would impair any State law applicable to any transaction enumerated or described in this section or section 6b of this title

   3. Substituted · 7 U.S.C. § 6c(a)

      Pub. L. 93–463, §§ 103(a), 402(a), (b), (d), substituted “Commission” for “Secretary of Agriculture”

   Source evidence

   Code amendment note
   Subsec. (a). Pub. L. 93–463, §§ 103(a), 402(a), (b), (d), designated existing provisions as subsec. (a), in par. (B) of subsec. (a) as so designated inserted “if such transaction involves any commodity specifically set forth in section 2(a) of this title, prior to the enactment of the Commodity Futures Trading Commission Act of 1974, and” and “option”, and in provisions following par. (C), struck out provisions prohibiting a construction of this section or section 6b of this title which would impair any State law applicable to any transaction enumerated or described in this section or section 6b of this title and substituted “Commission” for “Secretary of Agriculture”.

   Enacted provision · exact public law section
   (a) By 7 USC 6, 6a, 6c–6g, 6i, 7, 7a, 8, 9, 11, 12, 12–1, 12a, 12b, 13b, 16. striking the word “Secretary” and the words “Secretary of Agriculture” wherever such words appear therein (except where the words “Secretary of Agriculture” first appear in section 5(a)(7 U.S.C. 7) or where said words would be stricken by subsection (b), (c), or (d) of this section) and by inserting in lieu thereof the word “Commission”.

3. 1974

   Commodity Futures Trading Commission Act of 1974

   Pub. L. 93–463 § 402(c) · 88 Stat. 1389

   Added · 7 U.S.C. § 6c(b)

   Pub. L. 93–463, § 402(c), added subsec. (b)

   Source evidence

   Code amendment note
   Subsec. (b). Pub. L. 93–463, § 402(c), added subsec. (b).

   Enacted provision · exact public law section
   (c) By adding at the end thereof the following new subsection: “(b) No person shall offer to enter into, enter into, or confirm the execution of, any transaction subject to the provisions of subsection (a) of this section involving any commodity regulated under this Act, but not specifically set forth in section 2(a) of this Act, prior to the 7 USC 2. enactment of the Commodity Futures Trading Commission Act of 1974, which is of the character of, or is commonly known to the trade as, an ‘option’, ‘privilege’, ‘indemnity’, ‘bid’, ‘offer’, ‘put’, ‘call’, ‘advance guaranty’, or ‘decline guaranty’, contrary to any rule, regulation, or order of the Commission prohibiting any such transaction or allowing any such transaction under such terms and conditions as the Commission shall prescribe within one year after the effective date of the Commodity Futures Trading Commission Act of 1974 unless the Commission Notification of congressional committees. determines and notifies the Senate Committee on Agriculture and Forestry and the House Committee on Agriculture that it is unable to prescribe such terms and conditions within such period of time: Provided, That any such order, rule, or regulation may be made only after notice and opportunity for hearing: And provided further, That the Commission may set different terms and conditions for different markets.”

4. 1978

   Futures Trading Act of 1978

   Pub. L. 95–405 § 3(1) · 92 Stat. 865

   Substituted · 7 U.S.C. § 6c(a)

   Pub. L. 95–405, § 3(1), in provisions following par. (C) substituted “have been approved” for “not have been disapproved”

   Source evidence

   Code amendment note
   Subsec. (a). Pub. L. 95–405, § 3(1), in provisions following par. (C) substituted “have been approved” for “not have been disapproved”.

   Enacted provision · exact public law section
   (1) striking out in the last sentence of subsection (a) “not have been disapproved” and inserting in li6u thereof “have been approved”;

5. 1978

   Futures Trading Act of 1978

   Pub. L. 95–405 § 3(2) · 92 Stat. 865

   Substituted · 7 U.S.C. § 6c(b)

   Pub. L. 95–405, § 3(2), substituted “Senate Committee on Agriculture, Nutrition, and Forestry” for “Senate Committee on Agriculture and Forestry”

   Source evidence

   Code amendment note
   Subsec. (b). Pub. L. 95–405, § 3(2), substituted “Senate Committee on Agriculture, Nutrition, and Forestry” for “Senate Committee on Agriculture and Forestry”.

   Enacted provision · exact public law section
   (2) striking out in subsection (b) “Senate Committee on Agriculture and Forestry” and inserting in lieu thereof “Senate Committee on Agriculture, Nutrition, and Forestry”; and

6. 1978

   Futures Trading Act of 1978

   Pub. L. 95–405 § 3(3) · 92 Stat. 865

   Added · 7 U.S.C. § 6c(c)(e)

   Pub. L. 95–405, § 3(3), added subsecs. (c) to (e)

   Source evidence

   Code amendment note
   Subsecs. (c) to (e). Pub. L. 95–405, § 3(3), added subsecs. (c) to (e).

   Enacted provision · exact public law section
   (3) adding at the end thereof new subsections (c), (d), and (e) as follows: “(c) Notwithstanding the provisions of subsection (b) of this Report to congressional committees. Regulations. section, no person may, after the enactment of the Futures Trading Act of 1978, offer to enter into, enter into, or confirm the execution of any commodity option transaction involving any commodity regulated under this Act but not specifically set forth in section 2(a) of this Act prior to the enactment of the Commodity Futures Trading Ante, p. 865. 7 USC 1 note. Commission Act of 1974, until (1) the Commission transmits to the House Committee on Agriculture and the Senate Committee on Agriculture, Nutrition, and Forestry documentation of its ability to regulate successfully such transactions, including a copy of the Commission’s proposed rules and regulations, and (2) the expiration of thirty calendar days of continuous session of Congress after the date of such transmittal. The Commission is not precluded from transmitting, at any time, documentation relating to its ability to regulate such transactions regarding individual commodities, classes of commodities, or regulation of such transactions on specific boards of trade. Nothing in this subsection shall affect any rights or obligations arising out of any transactions subject to the provisions of this subsection entered into, or the execution of which was confirmed, prior to October 1, 1978: Provided, That this prohibition shall not apply to any transaction expressly permitted under rules or regulations prescribed by the Commission, before or after the date of enactment of the Futures Trading Act of 1978, to be offered to be Ante, p. 865 entered into, entered into, or confirmed, in which the purchaser is a producer, processor, commercial user of, or a merchant handling, the commodity involved in the transaction, or the products or byproducts thereof. “(d) Notwithstanding the provisions of subsection (c) of this section— “(1) any person domiciled in the United States who on May 1, Regulations. 1978, was in the business of granting an option on a physical commodity and was in the business of buying, selling, producing, or otherwise using that commodity, may continue to grant or issue options on that commodity in accordance with Commission regu-lations in effect on August 17, 1978, until thirty days after the effective date of regulations issued by the Commission under clause (2) of this subsection: Provided, That if such person files an application for registration under the regulations issued under clause (2) of this subsection within thirty days after the effective date of such regulations, that person may continue to grant or issue options pending a final determination by the Commission on the application; and “(2) the Regulations. Commission shall issue regulations that permit grantors and futures commission merchants to offer to enter into, enter into, or confirm the execution of, any commodity option transaction on a physical commodity subject to the provisions of subsection (b) of this section if— “(A) the grantor is a person domiciled in the United States who— “(i) is in the business of buying, selling, producing, or otherwise using the underlying commodity; “(ii) at all times has a net worth of at least $5,000,000 certified annually by an independent public accountant using generally accepted accounting principles; “(iii) notifies the Commission and every futures commission merchant offering the grantor’s option if the grantor knows or has reason to believe that the grantor’s net worth has fallen below $5,000,000; “(iv) segregates daily, exclusively for the benefit of purchasers, money, exempted securities (within the meaning of section 8(a)(12) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(12)), commercial paper, bankers’ acceptances, commercial bills, or unencumbered warehouse receipts, equal to an amount by which the value of each transaction exceeds the amount received or to be received by the grantor for such transaction; “(v) provides an identification number for each transaction; and “(vi) provides confirmation of all orders for such transactions executed, including the execution price and a transaction identification number; “(B) the futures commission merchant is a person who— “(i) has evidence that the grantor meets the requirements specified in subclause (A) of this clause; “(ii) treats and deals with all money, securities, or property received from its customers as payment of the purchase price in connection with such transactions, as belonging to such customers until the expiration of the term of the option, or, if the customer exercises the option, until all rights of the customer under the commodity option transaction have been fulfilled; “(iii) records each transaction in its customer’s name by the transaction identification number provided by the grantor; “(iv) provides a disclosure statement to its customers, under regulations of the Commission, that discloses, among other things, all costs, including any markups or commissions involved in such transaction; and “(C) the grantor and futures commission merchant comply with any additional uniform and reasonable terms and conditions the Commission may prescribe, including registration with the Commission. The Commission may permit persons not domiciled in the United Regulations. States to grant options under this subsection under such additional rules, regulations, and orders as the Commission may adopt to provide protection to purchasers that are substantially the equivalent of those applicable to grantors domiciled in the United States. The Commission Hearing. may terminate the right of any person to grant, offer, or sell options under this subsection only after a hearing, including a finding that the continuation of such right is contrary to the public interest: Provided, That pending the completion of such termination proceedings, the Commission may suspend the right to grant, offer, or sell options of any person whose activities in the Commission’s judgment present a substantial risk to the public interest. “(e) The Commission may adopt rules and regulations, after public Regulations. notice and opportunity for a hearing on the record, prohibiting the granting, issuance, or sale of options permitted under subsection (d) of this section if the Commission determines that such options are contrary to the public interest.”.

7. 1983

   Futures Trading Act of 1982

   Pub. L. 97–444 § 206(1) · 96 Stat. 2294

   Redesignated · 7 U.S.C. § 6c(a)(B); 7 U.S.C. § 6c(a)(C)

   Pub. L. 97–444, § 206(1), redesignated par. (C) as (B). Former par. (B), relating to transactions involving any commodity specifically set forth in section 2(a) of this title, prior to October 23, 1974, if such transactions were of the character of, or were commonly known to the trade as, an “option”, “privilege”, “indemnity”, “bid”, “offer”, “put”, “call”, “advance guaranty”, or “decline guaranty”, was struck out

   Source evidence

   Code amendment note
   Subsec. (a)(B), (C). Pub. L. 97–444, § 206(1), redesignated par. (C) as (B). Former par. (B), relating to transactions involving any commodity specifically set forth in section 2(a) of this title, prior to October 23, 1974, if such transactions were of the character of, or were commonly known to the trade as, an “option”, “privilege”, “indemnity”, “bid”, “offer”, “put”, “call”, “advance guaranty”, or “decline guaranty”, was struck out.

   Enacted provision · exact public law section
   (1) amending subsection (a) by— (A) inserting “or” at the end of clause (A); (B) striking out clause (B); and (C) redesignating clause (C) as clause (B);

8. 1983

   Futures Trading Act of 1982

   Pub. L. 97–444 § 206(2) · 96 Stat. 2294

   1. Struck · 7 U.S.C. § 6c(b)

      Pub. L. 97–444, § 206(2), in revising section generally, struck out references to any transaction subject to provisions of subsection (a) of this section and to any commodity not specifically set forth in section 2(a) of this title, prior to October 23, 1974

   2. Struck · 7 U.S.C. § 6c(b)

      Pub. L. 97–444, § 206(2), in revising section generally, struck out “within one year after the effective date of the Commodity Futures Trading Commission Act of 1974 unless the Commission determines and notifies the Senate Committee on Agriculture, Nutrition, and Forestry and the House Committee on Agriculture that it is unable to prescribe such terms and conditions within such period of time:” after “such terms and conditions as the Commission shall prescribe”

   Source evidence

   Code amendment note
   Subsec. (b). Pub. L. 97–444, § 206(2), in revising section generally, struck out references to any transaction subject to provisions of subsection (a) of this section and to any commodity not specifically set forth in section 2(a) of this title, prior to October 23, 1974, and struck out “within one year after the effective date of the Commodity Futures Trading Commission Act of 1974 unless the Commission determines and notifies the Senate Committee on Agriculture, Nutrition, and Forestry and the House Committee on Agriculture that it is unable to prescribe such terms and conditions within such period of time:” after “such terms and conditions as the Commission shall prescribe”.

   Enacted provision · exact public law section
   (2) amending subsection (b) to read as follows: “(b) No person shall offer to enter into, enter into or confirm the execution of, any transaction involving any commodity regulated under this Act which is of the character of, or is commonly known to the trade as, an ‘option’, ‘privilege’, ‘indemnity’, ‘bid’, ‘offer’, ‘put’, ‘call’, ‘advance guaranty’, or ‘decline guaranty’, contrary to any rule, regulation, or order of the Commission prohibiting any such transaction or allowing any such transaction under such terms and conditions as the Commission shall prescribe. Any such order, rule, or regulation may be made only after notice and opportunity for hearing, and the Commission may set different terms and conditions for different markets.”;

9. 1983

   Futures Trading Act of 1982

   Pub. L. 97–444 § 206(3) · 96 Stat. 2294

   Inserted · 7 U.S.C. § 6c(c)

   Pub. L. 97–444, § 206(3), inserted “With respect to any commodity regulated under this chapter and specifically set forth in section 2(a) of this title prior to October 23, 1974, the Commission may, pursuant to the procedures set forth in this subsection, establish a pilot program for a period not to exceed three years to permit such commodity option transactions. The Commission may authorize commodity option transactions during the pilot program in as many commodities as will provide an adequate test of the trading of such option transactions. After completion of the pilot program, the Commission may authorize commodity option transactions without regard to the restrictions in the pilot program after the Commission transmits to the House Committee on Agriculture and the Senate Committee on Agriculture, Nutrition, and Forestry the documentation required under clause (1) of the first sentence of this subsection and the expiration of thirty calendar days of continuous session of Congress after the date of such transmittal.”

   Source evidence

   Code amendment note
   Subsec. (c). Pub. L. 97–444, § 206(3), inserted “With respect to any commodity regulated under this chapter and specifically set forth in section 2(a) of this title prior to October 23, 1974, the Commission may, pursuant to the procedures set forth in this subsection, establish a pilot program for a period not to exceed three years to permit such commodity option transactions. The Commission may authorize commodity option transactions during the pilot program in as many commodities as will provide an adequate test of the trading of such option transactions. After completion of the pilot program, the Commission may authorize commodity option transactions without regard to the restrictions in the pilot program after the Commission transmits to the House Committee on Agriculture and the Senate Committee on Agriculture, Nutrition, and Forestry the documentation required under clause (1) of the first sentence of this subsection and the expiration of thirty calendar days of continuous session of Congress after the date of such transmittal.”

   Enacted provision · exact public law section
   (3) in subsection (c), inserting immediately after the first sentence the following: “With respect to any commodity regulated under this Act and specifically set forth in section (2)(a) of this Act prior to the date of enactment of the Commodity Ante, p. 2294. 7 USC 1 note. Futures Trading Commission Act of 1974, the Commission may, pursuant to the procedures set forth in this subsection, establish a pilot program for a period not to exceed three years to permit such commodity option transactions. The Commission may authorize commodity option transactions during the pilot program in as many commodities as will provide an adequate test of the trading of such option transactions. After completion of the pilot program, the Commission may authorize commodity option transactions without regard to the restrictions in the pilot program after the Commission transmits to the House Committee on Agriculture and the Senate Committee on Agriculture, Nutrition, and Forestry the documentation required under clause (1) of the first sentence of this subsection and the expiration of thirty calendar days of continuous session of Congress after the date of such transmittal.”; and

10. 1983

    Futures Trading Act of 1982

    Pub. L. 97–444 § 206(4)(A) · 96 Stat. 2294

    Inserted · 7 U.S.C. § 6c(d)(1)

    Pub. L. 97–444, § 206(4)(A), inserted “, other than a commodity specifically set forth in section 2(a) of this title prior to October 23, 1974,” after “physical commodity”

    Source evidence

    Code amendment note
    Subsec. (d)(1). Pub. L. 97–444, § 206(4)(A), inserted “, other than a commodity specifically set forth in section 2(a) of this title prior to October 23, 1974,” after “physical commodity”.

    Enacted provision · exact public law section
    (A) in clause (1), inserting “, other than a commodity specifically set forth in section 2(a) of this Act prior to enactment of the Commodity Futures Trading Commission Act of 1974,” immediately after “physical commodity”;

11. 1983

    Futures Trading Act of 1982

    Pub. L. 97–444 § 206(4)(B) · 96 Stat. 2294

    Inserted · 7 U.S.C. § 6c(d)(2)

    Pub. L. 97–444, § 206(4)(B), inserted “, other than a commodity specifically set forth in section 2(a) of this title prior to October 23, 1974,” after “subsection (b) of this section” in provisions preceding subpar. (A)

    Source evidence

    Code amendment note
    Subsec. (d)(2). Pub. L. 97–444, § 206(4)(B), inserted “, other than a commodity specifically set forth in section 2(a) of this title prior to October 23, 1974,” after “subsection (b) of this section” in provisions preceding subpar. (A).

    Enacted provision · exact public law section
    (B) in clause (2), inserting “, other than a commodity specifically set forth in section 2(a) of this Act prior to enactment of the Commodity Futures Trading Commission Act of 1974,” immediately after “subsection (b) of this section”; and

12. 1983

    Futures Trading Act of 1982

    Pub. L. 97–444 § 206(4)(C) · 96 Stat. 2294

    Inserted · 7 U.S.C. § 6c(d)(2)

    Pub. L. 97–444, § 206(4)(C), inserted “, other than options on a commodity specifically set forth in section 2(a) of this title prior to October 23, 1974,” after “The Commission may permit persons not domiciled in the United States to grant options under this subsection” in provisions following par. (2)

    Target inherited from the preceding amendment note.

    Source evidence

    Code amendment note
    Pub. L. 97–444, § 206(4)(C), inserted “, other than options on a commodity specifically set forth in section 2(a) of this title prior to October 23, 1974,” after “The Commission may permit persons not domiciled in the United States to grant options under this subsection” in provisions following par. (2).

    Enacted provision · exact public law section
    (C) inserting “, other than options on a commodity specifically set forth in section (2)(a) of this Act prior to enactment of the Commodity Futures Trading Commission Act of 1974,” immediately after “The Commission may permit persons not domiciled in the United States to grant options under this subsection”.

13. 1983

    Futures Trading Act of 1982

    Pub. L. 97–444 § 102 · 96 Stat. 2294

    Added · 7 U.S.C. § 6c(f)

    Pub. L. 97–444, § 102, added subsec. (f)

    Source evidence

    Code amendment note
    Subsec. (f). Pub. L. 97–444, § 102, added subsec. (f).

    Enacted provision · exact public law section
    Sec. 102. options on foreign currencies Section 4c of the Commodity Exchange Act (7 U.S.C. 6c) is amended by adding at the end thereof the following new subsection: “(f) Nothing in this Act shall be deemed to govern or in any way be applicable to any transaction in an option on foreign currency traded on a national securities exchange.”.

14. 1986

    Futures Trading Act of 1986

    Pub. L. 99–641 title I § 102 · 100 Stat. 3556

    1. Amended · 7 U.S.C. § 6c(c)

       Pub. L. 99–641, amended subsec. (c) generally

    2. Substituted · 7 U.S.C. § 6c(c)

       Pub. L. 99–641, substituting provisions relating to regulations to eliminate pilot status of program for commodity option transactions for provisions relating to commodity option transactions, pilot program and permanent authorization, conditions ending prohibition, and excepted persons

    Source evidence

    Code amendment note
    Subsec. (c). Pub. L. 99–641, amended subsec. (c) generally, substituting provisions relating to regulations to eliminate pilot status of program for commodity option transactions for provisions relating to commodity option transactions, pilot program and permanent authorization, conditions ending prohibition, and excepted persons.

    Enacted provision · exact public law section
    SEC. 102. OPTIONS TRANSACTIONS. Subsection (c) of section 4c of the Commodity Exchange Act (7 U.S.C. 6c(c)) is amended to read as follows: “(c) Not later than 90 days after the date of the enactment of the Regulations. Futures Trading Act of 1986, the Commission shall issue regulations— “(1) to eliminate the pilot status of its program for commodity Contracts. option transactions involving the trading of options on contract markets, including any numerical restrictions on the number of commodities or option contracts for which a contract market may be designated; and “(2) otherwise to continue to permit the trading of such commodity options under such terms and conditions that the Commission from time to time may prescribe.”.

15. 1992

    Futures Trading Practices Act of 1992

    Pub. L. 102–546 § 402(4) · 106 Stat. 3590

    Changed · 7 U.S.C. § 6c(d)(2)

    Pub. L. 102–546, § 402(4), made technical amendments to references to section 78c(a)(12) of title 15 in subpar. (A)(iv) and to section 2(a) of this title in concluding provisions

    Source evidence

    Code amendment note
    Subsec. (d)(2). Pub. L. 102–546, § 402(4), made technical amendments to references to section 78c(a)(12) of title 15 in subpar. (A)(iv) and to section 2(a) of this title in concluding provisions.

    Enacted provision · exact public law section
    (4) in section 4c(d)(2)— (A) in subparagraph (A)(iv) by striking “(15 U.S.C. 78c(a)(12))” and inserting “(15 U.S.C. 78c(a)(12))”; and (B) in the matter following subparagraph (C) by striking “section (2)(a)” and inserting “section 2(a)”;

16. 1992

    Futures Trading Practices Act of 1992

    Pub. L. 102–546 § 203(a) · 106 Stat. 3590

    Added · 7 U.S.C. § 6c(g)

    Pub. L. 102–546, § 203(a), added subsec. (g)

    Source evidence

    Code amendment note
    Subsec. (g). Pub. L. 102–546, § 203(a), added subsec. (g).

    Enacted provision · exact public law section
    (a) In General.— Section 4c (7 U.S.C. 6c) is amended by adding at the end the following new subsection: “(g) The Commission shall adopt rules requiring that a contemporaneous written record be made, as practicable, of all orders for execution on the floor or subject to the rules of each contract market placed by a member of the contract market who is present on the floor at the time such order is placed.”.

17. 2000

    Consolidated Appropriations Act, 2001

    Pub. L. 106–554 § 1(a)(5)(tI)(s109) · 114 Stat. 2763

    Inserted · 7 U.S.C. § 6c

    Pub. L. 106–554, § 1(a)(5) [title I, § 109], inserted section catchline

    Source evidence

    Code amendment note
    Pub. L. 106–554, § 1(a)(5) [title I, § 109], inserted section catchline.

    Enacted provision · exact public law section
    (5) H.R. 5660, as introduced on December 14, 2000.

18. 2000

    Consolidated Appropriations Act, 2001

    Pub. L. 106–554 § 1(a)(5)(tI)(s109) · 114 Stat. 2763

    1. Added · 7 U.S.C. § 6c(a)

       Pub. L. 106–554, § 1(a)(5) [title I, § 109], added subsec. (a)

    2. Struck · 7 U.S.C. § 6c(a)

       Pub. L. 106–554, § 1(a)(5) [title I, § 109], struck out former subsec. (a) which read as follows: “It shall be unlawful for any person to offer to enter into, enter into, or confirm the execution of, any transaction involving any commodity, which is or may be used for (1) hedging any transaction in interstate commerce in such commodity or the products or byproducts thereof, or (2) determining the price basis of any such transaction in interstate commerce in such commodity, or (3) delivering any such commodity sold, shipped, or received in interstate commerce for the fulfillment thereof—

    Source evidence

    Code amendment note
    Subsec. (a). Pub. L. 106–554, § 1(a)(5) [title I, § 109], added subsec. (a) and struck out former subsec. (a) which read as follows: “It shall be unlawful for any person to offer to enter into, enter into, or confirm the execution of, any transaction involving any commodity, which is or may be used for (1) hedging any transaction in interstate commerce in such commodity or the products or byproducts thereof, or (2) determining the price basis of any such transaction in interstate commerce in such commodity, or (3) delivering any such commodity sold, shipped, or received in interstate commerce for the fulfillment thereof—

    “(A) if such transaction is, is of the character of, or is commonly known to the trade as, a ‘wash sale,’ ‘cross trade,’ or ‘accommodation trade,’ or is a fictitious sale; or “(B) if such transaction is used to cause any price to be reported, registered, or recorded which is not a true and bona fide price. Nothing in this section shall be construed to prevent the exchange of futures in connection with cash commodity transactions or of futures for cash commodities, or of transfer trades or office trades if made in accordance with board of trade rules applying to such transactions and such rules shall have been approved by the Commission.”

    Enacted provision · exact public law section
    (5) H.R. 5660, as introduced on December 14, 2000.

19. 2000

    Consolidated Appropriations Act, 2001

    Pub. L. 106–554 § 1(a)(5)(tI)(s123)(a)(6) · 114 Stat. 2763

    Inserted · 7 U.S.C. § 6c(g)

    Pub. L. 106–554, § 1(a)(5) [title I, § 123(a)(6)], inserted “or derivatives transaction execution facility” after “contract market” in two places

    Source evidence

    Code amendment note
    Subsec. (g). Pub. L. 106–554, § 1(a)(5) [title I, § 123(a)(6)], inserted “or derivatives transaction execution facility” after “contract market” in two places.

    Enacted provision · exact public law section
    (5) H.R. 5660, as introduced on December 14, 2000.

20. 2010

    Wall Street Transparency and Accountability Act of 2010

    Pub. L. 111–203 § 741(b)(2) · 124 Stat. 1376

    Inserted · 7 U.S.C. § 6c(a)(1)

    Pub. L. 111–203, § 741(b)(2), inserted “or swap” before “if the transaction is used or may be used”

    Source evidence

    Code amendment note
    Subsec. (a)(1). Pub. L. 111–203, § 741(b)(2), inserted “or swap” before “if the transaction is used or may be used”.

    Enacted provision · exact public law section
    (2) Section 4c(a)(1) of the Commodity Exchange Act (7 U.S.C. 6c(a)(1)) is amended by inserting “or swap” before “if the transaction is used or may be used”.

    Effective date note
    Amendment by Pub. L. 111–203 effective on the later of 360 days after July 21, 2010, or, to the extent a provision of subtitle A (§§ 711–754) of title VII of Pub. L. 111–203 requires a rulemaking, not less than 60 days after publication of the final rule or regulation implementing such provision of subtitle A, see section 754 of Pub. L. 111–203, set out as a note under section 1a of this title.

21. 2010

    Wall Street Transparency and Accountability Act of 2010

    Pub. L. 111–203 § 746 · 124 Stat. 1376

    Added · 7 U.S.C. § 6c(a)(3); 7 U.S.C. § 6c(a)(4)

    Pub. L. 111–203, § 746, added pars. (3) and (4)

    Source evidence

    Code amendment note
    Subsec. (a)(3), (4). Pub. L. 111–203, § 746, added pars. (3) and (4).

    Enacted provision · exact public law section
    SEC. 746. INSIDER TRADING.   Section 4c(a) of the Commodity Exchange Act (7 U.S.C. 6c(a)) is amended by adding at the end the following: “(3) Contract of sale.— It shall be unlawful for any employee or agent of any department or agency of the Federal Government who, by virtue of the employment or position of the employee or agent, acquires information that may affect or tend to affect the price of any commodity in interstate commerce, or for future delivery, or any swap, and which information has not been disseminated by the department or agency of the Federal Government holding or creating the information in a manner which makes it generally available to the trading public, or disclosed in a criminal, civil, or administrative hearing, or in a congressional, administrative, or Government Accountability Office report, hearing, audit, or investigation, to use the information in his personal capacity and for personal gain to enter into, or offer to enter into— “(A) a contract of sale of a commodity for future delivery (or option on such a contract); “(B) 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. 78f(a)); or “(C) a swap. “(4) Nonpublic information.— “(A) Imparting of nonpublic information.— It shall be unlawful for any employee or agent of any department or agency of the Federal Government who, by virtue of the employment or position of the employee or agent, acquires information that may affect or tend to affect the price of any commodity in interstate commerce, or for future delivery, or any swap, and which information has not been disseminated by the department or agency of the Federal Government holding or creating the information in a manner which makes it generally available to the trading public, or disclosed in a criminal, civil, or administrative hearing, or in a congressional, administrative, or Government Accountability Office report, hearing, audit, or investigation, to impart the information in his personal capacity and for personal gain with intent to assist another person, directly or indirectly, to use the information to enter into, or offer to enter into— “(i) a contract of sale of a commodity for future delivery (or option on such a contract); “(ii) 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. 78f(a)); or “(iii) a swap. “(B) Knowing use.— It shall be unlawful for any person who receives information imparted by any employee or agent of any department or agency of the Federal Government as described in subparagraph (A) to knowingly use such information to enter into, or offer to enter into— “(i) a contract of sale of a commodity for future delivery (or option on such a contract); “(ii) 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. 78f(a)); or “(iii) a swap. “(C) Theft of nonpublic information.— It shall be unlawful for any person to steal, convert, or misappropriate, by any means whatsoever, information held or created by any department or agency of the Federal Government that may affect or tend to affect the price of any commodity in interstate commerce, or for future delivery, or any swap, where such person knows, or acts in reckless disregard of the fact, that such information has not been disseminated by the department or agency of the Federal Government holding or creating the information in a manner which makes it generally available to the trading public, or disclosed in a criminal, civil, or administrative hearing, or in a congressional, administrative, or Government Accountability Office report, hearing, audit, or investigation, and to use such information, or to impart such information with the intent to assist another person, directly or indirectly, to use such information to enter into, or offer to enter into— “(i) a contract of sale of a commodity for future delivery (or option on such a contract); “(ii) 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. 78f(a)); or “(iii) a swap, provided, however, that nothing in this subparagraph shall preclude a person that has provided information concerning, or generated by, the person, its operations or activities, to any employee or agent of any department or agency of the Federal Government, voluntarily or as required by law, from using such information to enter into, or offer to enter into, a contract of sale, option, or swap described in clauses (i), (ii), or (iii).” .

    Effective date note
    Amendment by Pub. L. 111–203 effective on the later of 360 days after July 21, 2010, or, to the extent a provision of subtitle A (§§ 711–754) of title VII of Pub. L. 111–203 requires a rulemaking, not less than 60 days after publication of the final rule or regulation implementing such provision of subtitle A, see section 754 of Pub. L. 111–203, set out as a note under section 1a of this title.

22. 2010

    Wall Street Transparency and Accountability Act of 2010

    Pub. L. 111–203 § 747 · 124 Stat. 1376

    Added · 7 U.S.C. § 6c(a)(5)(7)

    Pub. L. 111–203, § 747, added pars. (5) to (7)

    Source evidence

    Code amendment note
    Subsec. (a)(5) to (7). Pub. L. 111–203, § 747, added pars. (5) to (7).

    Enacted provision · exact public law section
    SEC. 747. ANTIDISRUPTIVE PRACTICES AUTHORITY.   Section 4c(a) of the Commodity Exchange Act (7 U.S.C. 6c(a)) (as amended by section 746) is amended by adding at the end the following: “(5) Disruptive practices.— It shall be unlawful for any person to engage in any trading, practice, or conduct on or subject to the rules of a registered entity that— “(A) violates bids or offers; “(B) demonstrates intentional or reckless disregard for the orderly execution of transactions during the closing period; or “(C) is, is of the character of, or is commonly known to the trade as, ‘spoofing’ (bidding or offering with the intent to cancel the bid or offer before execution). “(6) Rulemaking authority.— The Commission may make and promulgate such rules and regulations as, in the judgment of the Commission, are reasonably necessary to prohibit the trading practices described in paragraph (5) and any other trading practice that is disruptive of fair and equitable trading. “(7) Use of swaps to defraud.— It shall be unlawful for any person to enter into a swap knowing, or acting in reckless disregard of the fact, that its counterparty will use the swap as part of a device, scheme, or artifice to defraud any third party.” .

    Effective date note
    Amendment by Pub. L. 111–203 effective on the later of 360 days after July 21, 2010, or, to the extent a provision of subtitle A (§§ 711–754) of title VII of Pub. L. 111–203 requires a rulemaking, not less than 60 days after publication of the final rule or regulation implementing such provision of subtitle A, see section 754 of Pub. L. 111–203, set out as a note under section 1a of this title.

23. 2012

    Stop Trading on Congressional Knowledge Act of 2012

    Pub. L. 112–105 § 5(1) · 126 Stat. 291

    Inserted · 7 U.S.C. § 6c(a)(3)

    Pub. L. 112–105, § 5(1), inserted in introductory provisions “or any Member of Congress or employee of Congress (as such terms are defined under section 2 of the STOCK Act) or any judicial officer or judicial employee (as such terms are defined, respectively, under section 2 of the STOCK Act)” after “any department or agency of the Federal Government”, “Member, officer,” after “position of the”, and “or by Congress or by the judiciary” after “creating the information”

    Source evidence

    Code amendment note
    Subsec. (a)(3). Pub. L. 112–105, § 5(1), inserted in introductory provisions “or any Member of Congress or employee of Congress (as such terms are defined under section 2 of the STOCK Act) or any judicial officer or judicial employee (as such terms are defined, respectively, under section 2 of the STOCK Act)” after “any department or agency of the Federal Government”, “Member, officer,” after “position of the”, and “or by Congress or by the judiciary” after “creating the information”.

    Enacted provision · exact public law section
    (1) in paragraph (3), in the matter preceding subparagraph (A)— (A) by inserting “or any Member of Congress or employee of Congress (as such terms are defined under section 2 of the STOCK Act) or any judicial officer or judicial employee (as such terms are defined, respectively, under section 2 of the STOCK Act)” after “Federal Government” the first place it appears; (B) by inserting “Member, officer,” after “position of the”; and (C) by inserting “or by Congress or by the judiciary” before “in a manner”; and

24. 2012

    Stop Trading on Congressional Knowledge Act of 2012

    Pub. L. 112–105 § 5(2)(A) · 126 Stat. 291

    Inserted · 7 U.S.C. § 6c(a)(4)(A)

    Pub. L. 112–105, § 5(2)(A), inserted in introductory provisions “or any Member of Congress or employee of Congress or any judicial officer or judicial employee” after “any department or agency of the Federal Government”, “Member, officer,” after “position of the”, and “or by Congress or by the judiciary” after “creating the information”

    Source evidence

    Code amendment note
    Subsec. (a)(4)(A). Pub. L. 112–105, § 5(2)(A), inserted in introductory provisions “or any Member of Congress or employee of Congress or any judicial officer or judicial employee” after “any department or agency of the Federal Government”, “Member, officer,” after “position of the”, and “or by Congress or by the judiciary” after “creating the information”.

    Enacted provision · exact public law section
    (A) in subparagraph (A), in the matter preceding clause (i)— (i) by inserting “or any Member of Congress or employee of Congress or any judicial officer or judicial employee” after “Federal Government” the first place it appears; (ii) by inserting “Member, officer,” after “position of the”; and (iii) by inserting “or by Congress or by the judiciary” before “in a manner”;

25. 2012

    Stop Trading on Congressional Knowledge Act of 2012

    Pub. L. 112–105 § 5(2)(B) · 126 Stat. 291

    Inserted · 7 U.S.C. § 6c(a)(4)(B)

    Pub. L. 112–105, § 5(2)(B), inserted “or any Member of Congress or employee of Congress or any judicial officer or judicial employee” after “Federal Government” in introductory provisions

    Source evidence

    Code amendment note
    Subsec. (a)(4)(B). Pub. L. 112–105, § 5(2)(B), inserted “or any Member of Congress or employee of Congress or any judicial officer or judicial employee” after “Federal Government” in introductory provisions.

    Enacted provision · exact public law section
    (B) in subparagraph (B), in the matter preceding clause (i), by inserting “or any Member of Congress or employee of Congress or any judicial officer or judicial employee” after “Federal Government”; and

26. 2012

    Stop Trading on Congressional Knowledge Act of 2012

    Pub. L. 112–105 § 5(2)(C)(i) · 126 Stat. 291

    Inserted · 7 U.S.C. § 6c(a)(4)(C)

    Pub. L. 112–105, § 5(2)(C)(i), inserted “or by Congress or by the judiciary” in two places in introductory provisions

    Source evidence

    Code amendment note
    Subsec. (a)(4)(C). Pub. L. 112–105, § 5(2)(C)(i), inserted “or by Congress or by the judiciary” in two places in introductory provisions.

    Enacted provision · exact public law section
    (i) in the matter preceding clause (i), by inserting “or by Congress or by the judiciary”— (I) before “that may affect”; and (II) before “in a manner”; and

27. 2012

    Stop Trading on Congressional Knowledge Act of 2012

    Pub. L. 112–105 § 5(2)(C)(ii) · 126 Stat. 291

    Inserted · 7 U.S.C. § 6c(a)(4)(C)(iii)

    Pub. L. 112–105, § 5(2)(C)(ii), inserted “to Congress, any Member of Congress, any employee of Congress, any judicial officer, or any judicial employee,” after “Federal Government,”

    Source evidence

    Code amendment note
    Subsec. (a)(4)(C)(iii). Pub. L. 112–105, § 5(2)(C)(ii), inserted “to Congress, any Member of Congress, any employee of Congress, any judicial officer, or any judicial employee,” after “Federal Government,”.

    Enacted provision · exact public law section
    (ii) in clause (iii), by inserting “to Congress, any Member of Congress, any employee of Congress, any judicial officer, or any judicial employee,” after “Federal Government,”.

31 of 32 references resolved to an enrolled provision · 1 partial