Noxious Weeds [New].. 2801 6j. 6k. 61. 6m. 6n. 60. 6p. 9a. 12-2. 12-3. 12c. 13a-1. 15a. 18. 19. 20. Commodity Futures Trading Commission [New]. Commissioners. (c) General Counsel. (d) Executive Director. (e) Powers and functions of Chairman. (f) Conflict of interest. (g) Liaison with Department of Agriculture. (h) Transmittal of budget requests and legislative recommendations to Congressional Committees. (1) Seal. (j) Rules and regulations. Trades and executions by floor brokers; trades by Same; fraud; misrepresentation [New]. Reviews and audits by Comptroller General [New]. Disciplinary actions; notice; review of action by Commission [New]. Action to enjoin or restrain violations; compliance writs and orders; jurisdiction and venue; process [New]. Leverage contracts for gold and silver [New]. Complaints against registered persons [New]. (a) Petition. (b) Investigation and hearing. (c) Determination. Registered futures associations [New]. (a) Registration statement. (b) Standards for registration; Commission findings. (c) Suspension of registration. (d) Fees and charges. (e) Registered persons not members of registered associations. (f) Denial of registration. (g) Withdrawal from registration; notice of withdrawal. (h) Commission review of disciplinary actions taken by registered futures associations. (1) Notice; hearing; findings; cancellation, reduction, or remission of penalties. (j) Changes or additions to association rules. (k) Abrogation of association rules; requests to associations by Commission to alter or supplement rules. (1) Suspension and revocation of registration; expulsion of members; removal of association officers or directors. (m) Reports to Congress. Research and information programs; reports to Congress [New]. § 2. Definitions. For the purposes of this chapter "contract of sale" shall be held to include sales, agreements of sale, and agreements to sell. The word "person" shall be construed to import the plural or singular, and shall include individuals, associations, partnerships, corporations, and trusts. The word "commodity" shall mean wheat, cotton, rice, corn, oats, barley, rye, flaxseed, grain sorghums, mill feeds, butter, eggs, Solanum tuberosum (Irish potatoes), wool, wool tops, fats and oils (including lard, tallow, cottonseed oil, peanut oil, soybean oil and all other fats and oils), cottonseed meal, cottonseed, peanuts, soybeans, soybean meal, livestock, livestock products, and frozen concentrated orange juice, and all other goods and articles, except onions as provided in section 13-1 of this title, and all services, rights, and interests in which contracts for future delivery are presently or in the future dealt in: Provided, That the Commission shall have exclusive jurisdiction with respect to accounts, agreements (including any transaction 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"), and transactions involving contracts of sale of a commodity for future delivery, traded or executed on a contract market designated pursuant to section 7 of this title or any other board of trade, exchange, or market, and transactions subject to regulation by the Commission pursuant to section 15a of this title: And provided further, That, except as hereinabove provided, nothing contained in this section shall (i) supersede or limit the jurisdiction at any time conferred on the Securities and Ex change Commission or other regulatory authorities under the laws of the United States or of any State, or (ii) restrict the Securities and Exchange Commission and such other authorities from carrying out their duties and responsibilities in accordance with such laws. Nothing in this section shall supersede or limit the jurisdiction conferred on courts of the United States or any State. Nothing in this chapter shall be deemed to govern or in any way be applicable to transactions in foreign currency, security warrants, security rights, resales of installment loan contracts, repurchase options, government securities, or mortgages and mortgage purchase commitments, unless such transactions involve the sale thereof for future delivery conducted on a board of trade. The term "future delivery", as used in this chapter, shall not include any sale of any cash commodity for deferred shipment or delivery. The words "board of trade" shall be held to include and mean any exchange or association, whether incorporated or unincorporated, of persons who shall be engaged in the business of buying or selling commodity or receiving the same for sale on consignment. The words "interstate commerce" shall be construed to mean commerce between any State, Territory, or possession, or the District of Columbia, and any place outside thereof; or between points within the same State, Territory, or possession, or the District of Columbia, but through any place outside thereof, or within any Territory or possession, or the District of Columbia. The words "cooperative association of producers" shall mean any cooperative association, cooperate or otherwise, not less than 75 per centum in good faith owned or controlled, directly or indirectly, by producers of agricultural products and otherwise complying with sections 291 and 292 of this title, including any organization acting for a group of such associations and owned or controlled by such associations, provided that business done for or with the United States of America, or any agency thereof, shall not be considered either member or nonmember business in determining the compliance of any such association with said sections. The words "member of a contract market" shall mean and include individuals, associations, partnerships, corporations, and trusts owning or holding membership in, or admitted to membership representation on, a contract market or given members' trading privileges thereon. The words "futures commission merchant" shall mean and include individuals, associations, partnerships, corporations, and trusts engaged in soliciting or in accepting orders for the purchase or sale of any commodity for future delivery on or subject to the rules of any contract market and that, in or in connection with such solicitation or acceptance of orders, accepts any money, securities, or property (or extends credit in lieu thereof) to margin, guarantee, or secure any trades or contracts that result or may result therefrom. The words "floor broker" shall mean any person who, in or surrounding any "pit", "ring", "post", or other place provided by a contract market for the meeting of persons similarly engaged, shall purchase or sell for any other person any commodity for future delivery on or subject to the rules of any contract market. The words "the Commission" shall mean the Commodity Futures Trading Commission established under section 4a of this title. The term "commodity trading advisor" shall mean any person who, for compensation or profit, engages in the business of advising others, either directly or through publications or writings, as to the value of commodities or as to the advisability of trading in any commodity for future delivery on or subject to the rules of any contract market, or who for compensation or profit, and as part of a regular business, issues or promulgates analyses or reports concerning commodities; but does not include (i) any bank or trust company, (ii) any newspaper reporter, newspaper columnist, newspaper editor, lawyer, accountant, or teacher, (iii) any floor broker or futures commission merchant, (iv) the publisher of any bona fide newspaper, news magazine, or business or financial publication of general and regular circulation including their employees, (v) any contract market, and (vi) such other persons not within the intent of this definition as the Commission may specify by rule, regulation, or order: Provided, That the furnishing of such services by the foregoing persons is solely incidental to the conduct of their business or profession. The term "commodity pool operator" shall mean any person engaged in a business which is of the nature of an investment trust, syndicate, or similar form of enterprise, and who, in connection therewith, solicits, accepts, or receives from others, funds, securities, or property, either directly or through capital contributions, the sale of stock or other forms of securities, or otherwise, for the purpose of trading in any commodity for future delivery on or subject to the rules of any contract market, but does not include such persons not within the intent of this definition as the Commission may specify by rule or regulation or by order. (Sept. 21, 1922, ch. 369, § 2(a) (1), formerly § 2(a), 42 Stat. 998; June 15, 1936, ch. 545, §§ 2, 3, 49 Stat. 1491; Apr. 7, 1938, ch. 108, 52 Stat. 205; Oct. 9, 1940, ch. 786, § 1, 54 Stat. 1059; Aug. 28, 1954, ch. 1041, title VII, § 710(a), 68 Stat. 913; July 26, 1955, ch. 382, § 1, 69 Stat. 375; Feb. 19, 1968, Pub. L. 90-258, § 1, 82 Stat. 26; July 23, 1968, Pub. L. 90-418, 82 Stat. 413; renumbered and amended Oct. 23, 1974, Pub. L. 93463, title I, § 101 (a) (1), (2), title II, §§ 201, 202, Oct. 23, 1974, 88 Stat. 1389, 1395.) CODIFICATION Section consists of part of subsec. (a) (1) of section 2 of the Commodity Exchange Act, act Sept. 21, 1922. The remainder of such subsec. (a) (1) is classified to section 4 of this title. Subsec. (a) (2)-(11) of section 2 of the Commodity Exchange Act is classified to section 4a of this title. Subsec. (b) of section 2 of the Commodity Exchange Act is classified to section 3 of this title. AMENDMENTS 1974 Pub. L. 93-463 struck out "onions," following "eggs," in the definition of "commodity" and added provisions to that definition to include as commodities all other goods and articles, except onions as provided in section 13-1 of this title, and all services, rights, and interests in which contracts for the future delivery are presently or in the future dealt in, added definitions for the terms "commodity trading advisor" and "commodity pool operator", and, as the definition of the words "the Commission". substituted "Commodity Futures Trading Commission established under section 4a of this title" for "Commodity Exchange Commission, consisting of the Secretary of Agriculture, the Secretary of Commerce, and the Attorney General, or an official or employee of each of the executive departments concerned, designated by the Secretary of Agriculture, the Secretary of Commerce, and the Attorney General, respectively; and the Secretary of Agriculture or his designee shall serve as Chairman". EFFECTIVE DATE OF 1974 AMENDMENT Section 418 of Pub. L. 93-463 provided that: "(a) Except as otherwise provided specifically in this Act [see Short Title note under section 4a of this title], the effective date of this Act shall be the 180th day after enactment [Oct. 23, 1974]. The Commission referred to in section 101 [Commodity Futures Trading Commission] is hereby established effective immediately on enactment of this Act [Oct. 23, 1974]. Sections 102 and 410 [amending sections 5108, 5314, 5315, and 5316 of Title 5] shall be effective immediately on enactment of this Act [Oct. 23, 1974]. Activities necessary to implement the changes effected by this Act may be carried out after the date of enactment [Oct. 23, 1974] and before as well as after the 180th day thereafter. Activities to be carried out after the date of enactment [Oct. 23, 1974] and before the 180th day thereafter may include, but are not limited to the following: designation of boards of trade as contract markets, registration of futures commission merchants, floor brokers, and other persons required to be registered under the Act [this chapter], approval or modification of bylaws, rules, regulations, and resolutions of contract markets, and issuance of regulations, effective on or after the 180th day after enactment [Oct. 23, 1974]; appointment and compensation of the members of the Commission; hiring and compensation of staff; and conducting of investigations and hearings. Nothing in this Act shall limit the authority of the Secretary of Agriculture or the Commodity Exchange Commission under the Commodity Exchange Act, as amended, prior to the 180th day after enactment of this Act [Oct. 23, 1974]. "(b) Funds appropriated for the administration of the Commodity Exchange Act, as amended [this chapter], may be used to implement this Act [see Short Title note under section 4a of this title] immediately after the date of enactment of this Act [Oct. 23, 1974]." SECTION REFERRED TO IN OTHER SECTIONS This section is referred to in section 6c of this title. SECTION REFERRED TO IN D.C. CODE This section is referred to in section 1-1182 of the District of Columbia Code. § 4. Liability of principal for act of agent. CODIFICATION Section 2(a) of act Sept. 21, 1922, was renumbered 2 (a) (1) by Pub. L. 93-463, title I, § 101 (a) (1), Oct. 23, 1974, 88 Stat. 1389. § 4a. Commodity Futures Trading Commission. (a) Establishment; composition; term of Commissioners. There is hereby established, as an independent agency of the United States Government, a Commodity Futures Trading Commission. The Commission shall be composed of a Chairman and four other Commissioners, who shall be appointed by the President, by and with the advice and consent of the Senate. In nominating persons for appointment, the President shall seek to establish and maintain a balanced Commission, including, but not limited to, persons of demonstrated knowledge in futures trading or its regulation and persons of demonstrated knowledge in the production, merchandising, processing or distribution of one or more of the commodities or other goods and articles, services, rights and interests covered by this chapter. Not more than three of the members of the Commission shall be members of the same political party. Each Commissioner shall hold office for a term of five years and until his successor is appointed and has qualified, except that he shall not so continue to serve beyond the expiration of the next session of Congress subsequent to the expiration of said fixed term of office, and except (A) any Commissioner appointed to fill a vacancy occurring prior to the expiration of the term for which his predecessor was appointed shall be appointed for the remainder of such term, and (B) the terms of office of the Commissioners first taking office after the enactment of this subsection shall expire as designated by the President at the time of nomination, one at the end of one year, one at the end of two years, one at the end of three years, one at the end of four years, and one at the end of five years. (b) Vacancies. A vacancy in the Commission shall not impair the right of the remaining Commissioners to exercise all the powers of the Commission. (c) General Counsel. The Commission shall have a General Counsel, who shall be appointed by the Commission and serve at the pleasure of the Commission. The General Counsel shall report directly to the Commission and serve as its legal advisor. The Commission shall appoint such other attorneys as may be necessary, in the opinion of the Commission, to assist the General Counsel, represent the Commission in all disciplinary proceedings pending before it, represent the Commission in courts of law whenever appropriate, assist the Department of Justice in handling litigation concerning the Commission in courts of law, and perform such other legal duties and functions as the Commission may direct. (d) Executive Director. The Commission shall have an Executive Director, who shall be appointed by the Commission, by and with the advice and consent of the Senate, and serve at the pleasure of the Commission. The Executive Director shall report directly to the Commission and perform such functions and duties as the Commission may prescribe. (e) Powers and functions of Chairman. (1) Except as otherwise provided in this subsection and in subsections (c) and (d) of this section, the executive and administrative functions of the Commission, including functions of the Commission with respect to the appointment and supervision of personnel employed under the Commission, the distribution of business among such personnel and among administrative units of the Commission, and the use and expenditure of funds, shall be exercised solely by the Chairman. (2) In carrying out any of his functions under the provisions of this subsection, the Chairman shall be governed by general policies of the Commission and by such regulatory decisions, findings, and determinations as the Commission may by law be authorized to make. (3) The appointment by the Chairman of the heads of major administrative units under the Commission shall be subject to the approval of the Commission. (4) Personnel employed regularly and full time in the immediate offices of Commissioners other than the Chairman shall not be affected by the provisions of this subsection. (5) There are hereby reserved to the Commission its functions with respect to revising budget estimates and with respect to determining the distribution of appropriated funds according to major programs and purposes. (6) The Chairman may from time to time make such provisions as he shall deem appropriate authorizing the performance by any officer, employee, or administrative unit under his jurisdiction of any functions of the Chairman under this subsection. (f) Conflict of interest. No Commissioner or employee of the Commission shall accept employment or compensation from any person, exchange, or clearinghouse subject to regulation by the Commission under this chapter during his term of office, nor shall he participate, directly or indirectly, in any contract market operations or transactions of a character subject to regulation by the Commission. (g) Liaison with Department of Agriculture. The Commission shall, in cooperation with the Secretary of Agriculture, establish a separate office within the Department of Agriculture to be staffed with employees of the Commission for the purpose of maintaining a liaison between the Commission and the Department of Agriculture. The Secretary shall take such steps as may be necessary to enable the Commission to obtain information and utilize such services and facilities of the Department of Agriculture as may be necessary in order to maintain effectively such liaison. In addition, the Secretary shall appoint a liaison officer, who shall be an employee of the Office of the Secretary, for the purpose of maintaining a liaison between the Department of Agriculture and the Commission. The Commission shall furnish such liaison officer appropriate office space within the offices of the Commission and shall allow such liaison officer to attend and observe all deliberations and proceedings of the Commission. (h) Transmittal of budget requests and legislative recommendations to Congressional Committees. (1) Whenever the Commission submits any budget estimate or request to the President or the Office of Management and Budget, it shall concurrently transmit copies of that estimate or request to the House and Senate Appropriations Committees and the House Committee on Agriculture and the Senate Committee on Agriculture and Forestry. (2) Whenever the Commission transmits any legislative recommendations, or testimony, or comments on legislation to the President or the Office of Management and Budget, it shall concurrently transmit copies thereof to the House Committee on Agriculture and the Senate Committee on Agriculture and Forestry. No officer or agency of the United States shall have any authority to require the Commission to submit its legislative recommendations, or testimony, or comments on legislation to any officer or agency of the United States for approval, comments, or review, prior to the submission of such recommendations, testimony, or comments to the Congress. In instances in which the Commission voluntarily seeks to obtain the comments or review of any officer or agency of the United States, the Commission shall include a description of such actions in its legislative recommendations, testimony, or comments on legislation which it transmits to the Congress. (i) Seal. The Commission shall have an official seal, which shall be judicially noticed. (j) Rules and regulations. The Commission is authorized to promulgate such rules and regulations as it deems necessary to govern the operating procedures and conduct of the business of the Commission. (Sept. 21, 1922, ch. 369, § 2(a) (2) -(11), as added Oct. 23, 1974, Pub. L. 93-463, title I, § 101 (a) (3), 88 Stat. 1389.) CODIFICATION Section consists of pars. (2)-(11) of section 2(a) of the Commodity Exchange Act. For purposes of codification the numbered pars. (2)–(11) have been translated as subsecs. (a)-(j), respectively, of this section, with subpars. (A)– (F) of par. (6) and subpars. (A) and (B) of par. (9) in the original being translated as pars. (1)-(6) of subsec. (e) and pars. (1) and (2) of subsec. (h) of this section, respectively. Par. (1) of section 2(a) of the Commodity Exchange Act is classified to sections 2 and 4 of this title. EFFECTIVE DATE Section effective on the 180th day after Oct. 23, 1974, with the establishment of the Commodity Futures Trading Commission to be immediately effective on Oct. 23, 1974, and with all activities necessary to implement the changes effected by this section to be carried out after Oct. 23, 1974, and before as well as after the 180th day thereafter, see section 418 of Pub. L. 93-463, set out as a note under section 2 of this title. SHORT TITLE Section 1 of Pub. L. 93-463 provided: "That this Act [enacting this section and sections 6j, 6k, 61, 6m, 6n, 60, 6p, 9a, 12-2, 12-3, 12c, 13a-1, 15a, 18, 19, 20, 21, and 22 of this title, amending sections 2, 4, 6, 6a, 6b, 6c, 6d, 6e, 6f, 6g, 61, 7, 7a, 7b, 8, 9, 11, 12, 12-1, 12a, 12b, 13. 13a, 13b, 15c, 15, and 16 of this title and sections 5314. 5315, 5316, and 5108 of Title 5, Government Organization and Employees, and enacting provisions set out as notes under this section and sections 2 and 6a of this title] may be cited as the 'Commodity Futures Trading Commission Act of 1974'." SEPARABILITY OF PROVISIONS Section 413 of Pub. L. 93-463 provided that: "If any provision of this Act [see Short Title note under this section] or the application thereof to any person or circumstances is held invalid, the validity of the remainder of the Act and the application of such provision to other persons or circumstances shall not be affected thereby." TRANSFER OF PERSONNEL, PROPERTY, RECORDS, AND FUNDS TO COMMODITY FUTURES TRADING COMMISSION Section 104 of Pub. L. 93-463 provided that: "All of the personnel of the Commodity Exchange Authority, property, records, and unexpended balance of appropriations, allocations, and other funds employed, used, held, available, or to be made available in connection with administration of the Commodity Exchange Act [this chapter] shall be transferred to the Commodity Futures Trading Commission upon the effective date of this Act [see Effective Date of 1974 Amendment note under section 2 of this title]." TRANSFER OF OPERATIONS TO COMMODITY FUTURES TRADING COMMISSION Section 411 of Pub. L. 93-463 provided that: "All operations of the Commodity Exchange Commission and of the Secretary of Agriculture under the Commodity Exchange Act [this chapter], including all pending administrative proceedings, shall be transferred to the Com |