Regras Do Sistema De Renovação De Forex

Revisão da renovação de Forex 8211 Barry Huddlestone Revisão da renovação de Forex 8211 Barry Huddlestone Informação chave Editora: Nenhum especificado Custo: Vários de 49,95 a 99,95 Data de revisão: Abril de 8211 Junho 2011 O que diz no site O mais incrível sistema de negociação nunca 99,83 Taxa de sucesso é o simples Manchete neste simples site. O vendedor, Barry Huddlestone, vem negociando desde 1969, Forex desde 2004. Ele é um ex-músico que escreveu uma série de poemas e também é o autor de The Acrostic Bible, detalhes fornecidos no site. Em dezembro de 2010, Barry afirma que ele tinha 65 negócios vencedores sem perdas. O alvo é 20 PIPs ea duração é tipicamente 15 30 minutos com alguns comércios que tomam mais por muito tempo. O custo do sistema varia (de 49,95 para 99,95), dependendo das sessões compradas, a escolha é: Nova York e / ou Londres e / ou Asiático e Europeu Todas as opções incluem 7 dias de acesso VIP e não há garantia de devolução do dinheiro em oferta . Thats sobre ele, um Web site simples com uma linha de Tag simples e uma estrutura de fixação simples. O material Nós decidimos que só trocaríamos a sessão de Londres para fins de revisão. A documentação para esta estratégia (e os outros) está em linha com o site, foi mantido simples e vem na forma de um pdf de 4 páginas. No início da documentação a seguinte recomendação é feita 8211 Não negocie este sistema ao vivo até que você tenha 50 negócios positivos consecutivos. A estratégia em si é baseada na observação de 6 pares de moedas populares no tempo de 15 minutos a partir de 7:45 hora do Reino Unido. Cada gráfico tem 3 médias móveis e uma linha de tendência (desenhada diariamente). Para a entrada, existem algumas regras mecânicas, bem como um número razoável de regras adicionais baseadas em ações de preços. A idéia é ter alta porcentagem de comércios em que podemos ser 100 certeza de que será um vencedor. Se nenhuma configuração ocorrer antes das 11:00 hora do Reino Unido, nenhum comércio será efetuado naquele dia. Parar de colocação é mecânico e geralmente acaba sendo cerca de 50 PIPs embora ele estado no manual Não se preocupe nunca foi atingido. Mas, como com qualquer coisa em Forex, poderia acontecer. O objectivo é fixado em 20 PIPs, embora existam regras discricionárias para fornecer saídas alternativas. A configuração do sistema é bastante simples, pois os indicadores são fáceis de adicionar a quase todos os pacotes de gráficos padrão. O desenho da linha de tendência Daily pode parecer um pouco complicado para começar, mas se torna muito mais fácil e segunda natureza após uma semana ou duas. A entrada é baseada nas 3 médias móveis, linha de tendência e ação de preço. No entanto, como mencionado acima, há aspectos adicionais discricionária a considerar o que significa que a entrada é cerca de 80 mecânica. Stop e Target (supondo que você use a opção mecânica definida e 20 PIPs, respectivamente, como fizemos) são 100 mecânica. Pode funcionar Declarações como Pára nunca foi atingido, 50 negócios positivos consecutivos e 99,83 Taxa de greve são, em nossa opinião, ambicioso. Certamente nunca experimentamos nenhuma verdade em nenhum deles. Cada dia, escolher a melhor configuração (o comércio que você vai ter naquele dia) envolve a aplicação da base de regra mecânica 80 e, em seguida, os aspectos discricionários. Nós temos negociado este sistema por 3 meses agora, abril junho inclusivo. Nossos resultados são os seguintes: Período / Prazo 3 meses / 15 minutos Tempo de negociação 07:45 8211 11:00 Risco de tempo do Reino Unido por comércio 2.00 Número de negócios / vencedores / perdedores 52/40 / -12 Percentual de negócios rentáveis ​​77 Média Ganhando / Perdendo o Comércio 0,74 / -2,00 Fator de Lucro (Lucro Bruto / Perda Bruta) 1,23 Maior Drawdown -4,33 Média por Mês Retorno 1,84 O acima significa que experimentamos um retorno médio mensal combinado de 1,84 durante os 3 meses que usamos o sistema, com base Em 2 risco por comércio. Devido aos aspectos discricionários relativos aos critérios de entrada, diríamos que os resultados acima são um reflexo do 8211 Us aplicando a base de 80 regras de entrada mecânica, a nossa experiência de negociação e, sem dúvida, a nossa inexperiência devido a apenas 3 meses de exposição a este sistema. As principais questões desta estratégia são, de facto, os aspectos discricionários relativos aos critérios de entrada. Alguns destes são documentados no manual e alguns são encontrados no fórum de membros ou atualizações por e-mail. Eles variam de observação Diferentes indicadores, maiores prazos, níveis de Fibonacci, etc O Risco: Recompensa também é uma desvantagem. O vendedor afirma abertamente que este é um sistema discricionário e que não é mecânico. Ele também afirma que vai ter paciência, disciplina e prática e que, eventualmente, você será capaz de, com experiência, dobrar as regras para se adequar ao seu próprio estilo de negociação. O acesso VIP de 7 dias inclui uma atualização diária sobre o comércio que Barry levou naquele dia. Este era sempre um comércio de vencimento, às vezes da sessão de Londres (se havia um vencedor), às vezes da sessão dos EU se os comércios de Londres eram vencidos. Não foi freqüentemente nós escolheu o exato mesmo comércio. Para resumir, porém, os aspectos mecânicos deste sistema parecem ter algum mérito. Aqueles com alguma experiência comercial podem muito bem achar que eles fornecem uma base de regra sólida o suficiente. Talvez o suficiente para construir e desenvolver os elementos discricionários para o palco onde eles superam a nossa taxa de ataque (77 8211 Lembre-se 72 é necessário apenas para breakeven) e acertar a magia 99. Gostaríamos de boas-vindas alguém relatando seu progresso. Suporte Nós não tivemos nenhuma razão para entrar em contato com o suporte, então não posso comentar. Resumo PRO8217s Fácil de configurar. Stop e Target são mecânicos. Alta taxa de vitórias (a ser esperado, porém, devido ao baixo risco: Reward ratio). CON8217s Entrada pode ser muito discricionário para alguns. Baixo Risco: Relação de recompensa (2,5: 1). Esperando 50 comércios consecutivos antes de começar a negociar ao vivo, suspeitamos, significaria que poucos iriam trocar este live. Lembre-se, seus comentários são importantes Se você usou ou decidiu usar este sistema, por favor, contribua para a comunidade, informando suas descobertas. Anexos: Você deve estar logado para ver os arquivos anexados. O sistema de registro on-line (ORS) O NFAs Online Registration System (ORS) permite que empresas e indivíduos se inscrevam com a CFTC e se candidatem à NFA. ORS também simplifica o processo de atualização e retirada. O NFA Dashboard, a entrada para ORS, resume todos os requisitos de arquivamento pendentes. Os candidatos e os inscritos atuais podem fazer o login abaixo. Futures Commission Merchants (FCMs) são obrigados a apresentar certos relatórios financeiros com NFA. A NFA desenvolveu um recurso em seu sistema BASIC que permite ao público ver as informações financeiras da FCM. Regulamento. Redefined. Product Review: Forex Renewal System Barry deixe-me testar o seu sistema de renovação Forex para que eu pudesse fazer outra revisão do produto. Eu admito que estou impressionado 8211 esta estratégia é o negócio real. Eu vou compartilhar o básico, mas não dar qualquer detalhe, porque então eu estaria dando a estratégia de distância e eu can8217t fazer isso. Este é um suporte muito simples e estratégia de resistência que qualquer pessoa pode usar. Eu testei-o por duas semanas e eu era bem sucedido diário exceto por dois dias e naqueles dias eu tive um comércio da ruptura mesmo e uma perda para 10 pips. Aqui estão os principais benefícios. A estratégia é rentável Fácil de usar Doesn8217t levar muito tempo Não há muitos negativos aqui, mas vou mencioná-los para fazer uma revisão justa e objetiva. Aqui estão os negativos: lucros limitados, alguns dos meus ganhos de comércio eram pequenos (eu sei, como posso me queixar, eles ainda eram lucros) Limite de tempo, você só pode negociar esta estratégia em um determinado tempo Global, esta é uma grande estratégia e Eu recomendo-o para os comerciantes que estão procurando uma estratégia negociando rentável. Se você usar um plano de negociação com boa gestão do dinheiro esta estratégia será um vencedor para você. Casey Stubbs é o fundador da Winners Edge Trading, que é um dos mais leia sites forex na web. Vencedores Edge Trading treinou milhares de pessoas para negociar os mercados de Forex. Disclaimer: Trading forex na margem carrega um alto nível de risco, e pode não ser adequado para todos os investidores. O alto grau de alavancagem pode trabalhar contra você, bem como para você. Antes de decidir investir em divisas você deve considerar cuidadosamente seus objetivos de investimento, nível de experiência e apetite pelo risco. A possibilidade existe que você poderia sustentar uma perda de alguns ou todos do seu investimento inicial e, portanto, você não deve investir o dinheiro que você não pode dar ao luxo de perder. Você deve estar ciente de todos os riscos associados com negociação de câmbio, e procurar aconselhamento de um consultor financeiro independente, se você tiver qualquer dúvida. O 8220Forex Renewal8221 código eu encontrei esta estratégia em um ebook que eu comprei. O autor alegou ter executado mais de 500 negócios vencedores em uma fileira. Obviamente isso é completamente irrealista. Mas eu pensei que a estratégia poderia estar ganhando, no entanto. Então eu decidi backtest esta estratégia. Não funcionou bem com as regras de entrada mencionadas no ebook, eu simplifiquei essas regras. Esta estratégia leva a vela breakout entre 8:45 e 09H, que define um intervalo. Se uma vela de sinal está completamente fora do intervalo, tomamos posição na direção da tendência, na quebra do alto / baixo desta vela de sinal. Apenas 1 troca por dia. Não comércio se a vela breakout é mais do que 45 pips. Esta estratégia aplica-se nos gráficos M15, principalmente no EUR / USD, e também no GBP / USD. Nenhuma informação neste site é conselho de investimento ou uma solicitação para comprar ou vender qualquer instrumento financeiro. O desempenho passado não é indicativo de resultados futuros. A negociação pode expô-lo ao risco de perda maior do que seus depósitos e só é adequado para investidores experientes que têm meios financeiros suficientes para suportar tal risco. ProRealTime ITF arquivos e outros anexos: Nova PRC também está agora no YouTube, subscrever o nosso canal de conteúdos exclusivos e tutoriaisRetail Transações de Câmbio (Regulamento NN) Enhanced Content - Document Tools Estas ferramentas são projetadas para ajudá-lo a entender melhor o documento oficial e ajuda Na comparação da edição on-line com a edição impressa. Esses elementos de marcação permitem ao usuário ver como o documento segue o Manual de elaboração de documentos que as agências usam para criar seus documentos. Estes podem ser úteis para entender melhor como um documento é estruturado, mas não fazem parte do próprio documento publicado. AGENDA: AÇÃO: RESUMO: O Conselho de Governadores do Sistema da Reserva Federal (ldquoBoardrdquo) está adotando uma regra final para permitir que as organizações bancárias sob sua supervisão se envolvam em transações off-exchange em Start Printed Página 21020 moeda estrangeira com clientes de varejo. A regra final também descreve vários requisitos que as organizações bancárias devem cumprir para realizar tais transações. DATAS: Esta regra entrará em vigor em 13 de maio de 2013. Início Mais Informações PARA MAIS INFORMAÇÕES CONTATO: Scott Holz, Diretor Jurídico, Divisão Jurídica, (202) 452-2966. I. Antecedentes Em 21 de julho de 2010, o Presidente Obama assinou em lei a Reforma Dodd-Frank Wall Street e Lei de Proteção ao Consumidor de 2010 (Dodd-Frank Act). 1 Conforme alterado pelo artigo 742 (c) (2) da Lei Dodd-Frank 2, o Commodity Exchange Act (CEA) estabelece que uma instituição financeira dos Estados Unidos que exista uma agência reguladora federal não inclua, ou Oferecer para entrar em certos tipos de operações de câmbio descritas na seção 2 (c) (2) (B) (i) (I) do CEA com um cliente de varejo, exceto conforme uma regra ou regulamento de uma agência reguladora federal Permitindo a transação sob os termos e condições que a agência reguladora federal prescreverá em 6 (a ldquoretail forex rulerdquo). Seção 2 (c) (2) (B) (i) (I) inclui um contrato, contrato ou transação em moeda estrangeira que seja um contrato de venda de uma mercadoria para entrega futura (ou uma opção em tal contrato) ou Uma opção (que não seja uma opção executada ou negociada em uma bolsa de valores nacional registrada de acordo com a seção 6 (a) da Securities Exchange Act de 1934 (15 USC 78 f (a)). Tratar todas as tais futuros e opções e todos os acordos, contratos ou transações que são funcionalmente ou economicamente similares a tais futuros e opções de forma semelhante 8 regras de forex varejo deve prescrever requisitos adequados com relação à divulgação, manutenção de registros, capital e margem, , E os requisitos de documentação, e pode incluir outras normas ou requisitos que a agência reguladora federal determine ser necessário.9 A regra de Boards aplica-se a ldquobanking instituições, rdquo um termo definido na seção 240.2 (b) para significar Estado membro bancos, estado não segurado - filiais licenciadas de bancos estrangeiros, holdings financeiras, holdings bancárias, companhias de poupança e de empréstimo, 10 corporações de acordo e corporações da Edge Act. Em 10 de setembro de 2010, a Commodity Futures Trading Commission (CFTC) adotou uma regra de varejo forex para pessoas sujeitas à sua jurisdição. 11 Depois de estudar e considerar a regra de divisas de varejo do CFTCs e consultar o Escritório do Controlador da Moeda (OCC) ea Federal Deposit Insurance Corporation (FDIC), o Conselho aprovou para publicação um aviso de proposta de regulamentação (NPR) Forex efetuadas pelas instituições bancárias em 28 de julho de 2011. O NPR foi publicado no Federal Register em 3 de agosto de 2011 12 eo período de comentários foi encerrado em 11 de outubro de 2011. Em resposta ao NPR, a Diretoria recebeu seis comentários: Três de indivíduos, um de um banco e dois de associações comerciais. Um dos comentadores individuais não abordou a regra, enquanto outro comentador individual expressou apoio geral para a regra. O terceiro indivíduo (doravante o nome do comentarista individual) e o banco (doravante o nome do comentarista do banco) apoiaram, em geral, a regra, ao mesmo tempo em que solicitavam certas precisões e modificações. Uma associação comercial solicitou mudanças para reduzir a carga sobre certas entidades que qualificariam como clientes de divisas no âmbito do regulamento proposto. A outra carta de associação de comércio solicitou mudanças para atender clientes de varejo que usam câmbio em conexão com a compra ou venda de um título denominado em moeda estrangeira. Esses comentários são abordados na seção por seção análise abaixo. O Conselho está adotando uma regra final que é substancialmente a mesma que a regra proposta, com alguns esclarecimentos como discutido abaixo. II. Seção de análise seção por seção 240.1mdashAuthority, Purpose e Scope Esta seção autoriza uma instituição bancária para realizar transações de varejo forex. O âmbito do regulamento abrange sucursais e escritórios de instituições bancárias, embora as sucursais e escritórios estrangeiros destas instituições não estejam sujeitas às secções 240.3 e 240.5 a 240.16, a menos que a sucursal ou escritório esteja a lidar com um cliente dos Estados Unidos. Uma vez que as secções 240.1 e 240.2 abrangem a autoridade, finalidade e âmbito do regulamento e as definições utilizadas no regulamento, se uma instituição bancária apenas as transacções forex varejo são conduzidas por uma sucursal ou escritório estrangeiro e limitada a clientes não-EUA, a única operação Do regulamento que se aplicaria seria a secção 240.4. Conforme descrito abaixo, esta seção exige que uma instituição bancária que deseje se envolver em transações de varejo forex para notificar a Diretoria antes de iniciar um negócio de varejo forex. O regulamento também abrange filiais de instituições bancárias que são organizadas sob as leis dos Estados Unidos ou um estado dos EUA, a menos que a subsidiária está sujeita à jurisdição de outra agência reguladora federal que está autorizado a prescrever regras de forex varejo sob a seção 2 (c) (2) (E) do Commodity Exchange Act. 13 As filiais de uma instituição bancária organizadas segundo legislação estrangeira não são abrangidas independentemente da nacionalidade do cliente. A regra é aplicável a transações de varejo de forex contratadas por instituições bancárias em ou após a data de efetivação. Seção 240.2mdashDefinitions Esta seção define termos específicos para transações de varejo forex e para os requisitos regulamentares aplicáveis ​​a transações de varejo forex. A definição de transação de divisas do ldquoretail geralmente inclui as seguintes transações em moeda estrangeira entre uma instituição bancária e uma pessoa que não é um participante de contrato elegível: (i) Um futuro ou uma opção em tal futuro 15 (ii) Opções não negociadas numa bolsa de valores nacional registada 16 e (iii) determinadas transacções com alavancagem ou margem. Esta definição tem várias características importantes. Em primeiro lugar, certas transacções em moeda estrangeira não estão sujeitas à proibição prevista na secção 742 (c) (2) da Lei Dodd-Frank. Por exemplo, uma transação de moeda estrangeira onde uma moeda é comprada para outra e as duas moedas são trocadas dentro de dois dias não é um ldquofuturerdquo e não iria cumprir a definição de uma transação forex ldquoretail, rdquo desde entrega real ocorre logo que possível. 17 Da mesma forma, uma transação de moeda estrangeira não inclui um contrato a termo com uma entidade comercial que cria uma obrigação executória de fazer ou receber entrega, desde que a contraparte comercial tenha a capacidade de fazer entrega e aceitar entrega em conexão com sua linha de negócios. 18 Além disso, ldquoretail forex transactionrdquo não inclui um produto bancário identificado de forma idêntica ou uma parte de um produto bancário identificado de forma idêntica, tal como definido na alínea b) do artigo 401º da Lei de Garantia Legal de Produtos Bancários de 2000. 19 Por fim, a definição não Incluem transações executadas em uma bolsa de valores e instituições bancárias não são elegíveis para efetuar transações de forex no varejo em um mercado contratado designado. Em segundo lugar, a definição de transação de divisas da ldquoretail abrange as operações de forex spot de rolamento oferecidas ou celebradas numa base de alavancagem ou de margem (os chamados Zelener Thinsp 20), incluindo, sem limitação, transacções na Internet, através de um telemóvel ou Uma plataforma eletrônica. Uma transação de forex spot rodando normalmente exige entrega de moeda dentro de dois dias, como transações spot. No entanto, na prática, esses contratos são indefinidamente renovados a cada dois dias e nenhuma moeda é realmente entregue até que uma das partes afirmativamente fecha a posição. Por conseguinte, os contratos são economicamente mais parecidos com futuros do que com contratos à vista, embora alguns tribunais os considerem contratos à vista. 22 Uma das cartas de comentários das associações comerciais foi apresentada pela American Bankers Association e pela Divisão Global de Divisas do Global Financial Markets Associations (doravante denominada ABD / GFMA letterrdquo). A carta de comentário buscava esclarecimento ou alívio que resultaria na isenção de certas transações de câmbio por clientes de varejo iniciada apenas com a finalidade de concluir uma transação em títulos estrangeiros. Esta carta de comentários foi endereçada a todas as agências reguladoras federais que promulgaram ou propuseram regras de divisas de varejo: a Diretoria, CFTC, FDIC, OCC e Securities and Exchange Commission. Em 18 de julho de 2012, a CFTC emitiu uma regra final que incluía uma interpretação referente a operações cambiais de câmbio que responderam à carta ABA / GFMA. Especificamente, a CFTC definiu uma transação forex de bona fide para incluir a compra ou venda de uma quantidade de moeda estrangeira igual ao preço de um título estrangeiro onde (i) as operações de valores mobiliários e operações em moeda estrangeira relacionadas são executadas simultaneamente para efetuar a entrega Pelo prazo de liquidação de valores mobiliários relevante, e (ii) a entrega efetiva da moeda estrangeira ocorrer dentro desse prazo. Ao interpretar o CEA para excluir esses tipos de operações de câmbio de varejo efetuadas em conexão com compras e vendas de títulos, a CFTC confirmou que as transações não estão sujeitas às disposições do CEA que são referenciadas pela seção 742 da Lei Dodd-Frank. A Diretoria acredita que nenhuma emenda à regra final é necessária para resolver esta questão. A Diretoria também adicionou uma seção à regra final para esclarecer que a Diretoria pode modificar as disposições desta regra para uma determinada transação de varejo forex ou uma classe de transações de varejo forex se a Diretoria determinar que a modificação é consistente com a segurança e solidez e Proteção dos clientes forex varejo. A Seção 240.2 define vários termos por referência ao CEA, incluindo o contrato de participação qualificada (ECP). As transacções em moeda estrangeira com participantes elegíveis do contrato não são consideradas transacções de forex a retalho e, por conseguinte, não estão sujeitas a esta regra. A definição abrange uma variedade de entidades financeiras, entidades governamentais, certas empresas e indivíduos que atingem determinados limiares de investimento. 23 A carta de comentários apresentada pela Divisão Global FX das Associações de Mercados Financeiros Globais (doravante denominada GFMA letterrdquo) e o comentarista do banco declararam sua crença de que a definição de contrato de participação qualificada é demasiado estreita e desnecessariamente exige que instituições bancárias ofereçam proteções de varejo a clientes sofisticados que Não se qualificam como ECPs porque não cumprem o limite de 10 milhões de ativos na definição estatutária. O comentarista da associação comercial e o comentarista do banco recomendaram que a definição de ldquoretail forex customerrdquo na seção 240.2 (n) elimine instituições não-ECPs representadas por conselheiros de investimento registrados. O comentarista da associação comercial também buscou uma carga reduzida para um pool de commodities que é incapaz de provar que todos os seus participantes são eles próprios ECPs. A carta da GFMA também sugeriu que, se a Diretoria não isenta essas entidades de todos os aspectos do regulamento, o Conselho deve, no mínimo, permitir o que ele chama de não-ECPsquotquo para (1) Conforme descrito na seção 240.6 (e), (2) pós margem reduzida em relação aos clientes de varejo e (3) acomodar a flexibilidade de execução da transação não permitida pelo regulamento proposto. O Conselho não está adotando a sugestão de que uma ECP não seja tratada como uma ECP com base na sua utilização de um consultor de investimentos, pois acredita que a seção 2 (c) (2) (E) da CEA exige a aplicação de regras de varejo forex às transações Com não-ECPs. Embora os grandes conselheiros de investimento possam optar por evitar lidar com investidores pouco sofisticados, a Diretoria não acredita que o envolvimento de um grande conselheiro de investimentos seja um substituto das proteções de varejo procuradas pelo Congresso ao promulgar a seção 2 (C) (2) (E) de O CEA. A questão relativa ao estatuto do PEC dos agrupamentos de mercadorias envolvidos em transacções cambiais foi incluída no aviso da CFTC sobre a proposta de regulamentação no que se refere à definição de certos termos da Lei Dodd-Frank, incluindo o contrato de contrato qualificado, , 2012. 25 A definição de ECP da CFTC reduz a carga sobre os pools de commodities, procurando estabelecer que todos os seus membros são, eles próprios, ECPs. A Diretoria está alterando a definição de ECP na seção 240.2 do regulamento para incorporar a definição revisada CFTCs de ECP. Isso permitirá que as instituições bancárias usem o mesmo padrão para o estatuto de ECP como negociantes de varejo do forex sujeitos à jurisdição da CFTC quando lidam com pools de commodities. Em consonância com as disposições da regra final do CEA e da CFTC, a Junta não está adotando a sugestão dos comentadores de que os pools de commodities estão isentos da exigência legal de estabelecer que seus membros são eles próprios ECPs. A carta GFMA também buscou esclarecimentos de que uma instituição bancária com um cliente de varejo forex que mais tarde se torne um ECP pode continuar a tratar o cliente como um cliente forex varejo (ou seja, como não-ECP). O Conselho acredita que uma instituição bancária pode continuar a cumprir o regulamento para tal cliente. Com efeito, uma instituição bancária pode aplicar as disposições do Regulamento NN às transacções com qualquer cliente, embora só seja obrigado a aplicar o regulamento às transacções de forex de retalho com clientes de forex de retalho. Além de modificar a definição de ECP, a Diretoria está adicionando uma definição de ldquosavings e empresa holding de crédito. Em todos os outros aspectos, esta seção está sendo adotada substancialmente Como proposto. Seção 240.3mdash Transações proibidas Esta seção proíbe uma instituição bancária e suas pessoas relacionadas de se engajar em conduta fraudulenta em conexão com transações de varejo forex. Esta seção também aborda potenciais conflitos de interesse, proibindo uma instituição bancária de atuar como contraparte de uma transação de varejo forex se a instituição bancária ou sua afiliada exerce discrição sobre os clientes varejo conta forex. A proposta dos Conselhos utilizou uma formulação um pouco diferente da utilizada pela CFTC, OCC e FDIC. Enquanto as regras de varejo forex de outras autoridades reguladoras federais afirmam que uma contraparte de varejo forex não pode ldquocheat ou defraudar ou tentar enganar ou defraudrdquo qualquer pessoa, a proposta Boards usou a frase ldquodefraud ou tentar defraud. rdquo O comentarista individual recomendou a utilização de ldquocheat ou Defraudrdquo em vez de ldquodefraud, rdquo que ele acredita que iria promover a coerência regulatória entre os reguladores. A Junta observa que a frase ldquocheat ou defraudrdquo é usada na seção 6b do CEA (ldquoContracts projetados para defraudar ou misleadrdquo) thinsp 26 e está emendando sua proposta de usar a mesma linguagem que o CEA e outros reguladores. Além disso, a proposta da Diretoria proibiria uma instituição bancária de fazer um relatório falso ou enganar uma pessoa, enquanto os outros reguladores proíbem seus comerciantes forex de varejo de participar ativamente dessas atividades. A Diretoria afirmou sua crença de que, no futuro, a norma estabelece um padrão de prova mais apropriado. O comentarista individual preferiu a linguagem usada por outros reguladores, em parte para melhorar a consistência regulatória. O Departamento de Justiça (DOJs) US Attorneys Manual discute a diferença entre ldquoknowinglyquot e ldquowillfullyrdquo em relação a 18 U. S.C. 1001. o federal criminal códigos gerais disposição anti-fraude. 27 Esta discussão é consistente com um caso do Supremo Tribunal relativo a outra disposição do código penal. 28 Tanto o DOJ como a Corte indicam que uma violação deficiente exige que se demonstre que o réu agiu com conhecimento de que sua conduta era ilegal, enquanto que uma violação de conhecimento exige que se conheça os fatos que constituem a infração, diferentemente do conhecimento da lei. A Diretoria acredita que ldquoknowinglyquota estabelece o padrão mais apropriado, pois abrangerá fazer um relatório falso ou comportamento enganoso sem exigir prova de que a instituição bancária sabia que estava violando o Regulamento NN. Seção 240.4mdashNotification Esta seção requer uma instituição bancária para notificar o Conselho antes de se envolver em um negócio de varejo forex. Este aviso inclui informações sobre a devida diligência do cliente (incluindo avaliações de crédito, adequação do cliente, e ldquoknow sua documentação customerrdquo) cortes de cortes de aprovações de novos produtos para margem de não-caixa e conflitos de interesse. Além disso, a instituição bancária deve certificar que possui políticas, procedimentos e sistemas e controles de medição e gerenciamento de riscos adequados para se envolver em um negócio de varejo de forex de forma segura e sólida e em conformidade com os requisitos da regra de forex de varejo do Boards . Uma vez que uma instituição bancária tenha notificado o Conselho de Administração em conformidade com esta disposição, o Conselho terá sessenta dias para solicitar informações adicionais ou opor-se à notificação por escrito, ou a notificação será considerada eficaz. Se a Diretoria solicitar informações adicionais, o aviso entrará em vigor sessenta dias depois que todas as informações solicitadas forem recebidas pela Diretoria, a menos que a Diretoria se oponha por escrito. Embora os requisitos legais em relação a contratos de futuros e opções estejam atualmente em vigor, algumas instituições bancárias podem atualmente se envolver em transações de varejo de forex que seriam abrangidas por esta regra, como os chamados contratos de ldquoZelener. rdquo Instituições bancárias envolvidas em varejo forex Transações a partir da data de vigência desta regra que prontamente notificar o Conselho terá seis meses, ou um período mais longo previsto pelo Conselho, para colocar suas operações em conformidade com a regra. De acordo com esta regra, uma instituição bancária que notificar a Diretoria dentro de 30 dias da data de vigência da regra final de divisas de varejo, sujeita a uma prorrogação pela Diretoria e apresentar as informações solicitadas pela Diretoria posteriormente será considerada como operando seu varejo Forex de acordo com uma regra ou regulamento de uma agência reguladora Federal, conforme exigido pela Commodity Exchange Act, para esse período. 29 Uma instituição bancária não precisa se unir a uma organização de auto-regulação de futuros como condição para conduzir um negócio de varejo de forex. Início Imprimido Page 21023 O Conselho não recebeu comentários a esta seção e o adota como proposto. Seção 240.5mdashAplicação e encerramento de compensação de posições longas e curtas Esta seção exige que uma instituição bancária para fechar compensar posições longas e curtas na mesma moeda em uma conta forex varejo. No entanto, uma instituição bancária pode compensar as transações de varejo de forex pelo cliente de varejo forex ou pelo agente de clientes (que não a própria instituição bancária) de acordo com instruções específicas de um cliente. As instruções gerais não são suficientes para este propósito, uma vez que poderiam evitar a regra geral. No entanto, as instruções de deslocamento não precisam ser dadas separadamente para cada par de ordens para serem específicas. As instruções que se aplicam a conjuntos de transações suficientemente definidos podem ser suficientemente específicas. As instruções de deslocamento podem ser fornecidas por escrito ou oralmente. A instituição bancária deve criar e manter um registro de cada instrução de compensação. A Diretoria não recebeu comentários a esta seção e a adota como proposto. Seção 240.6mdashDisclosure Esta seção requer uma instituição bancária para fornecer aos clientes forex varejo com uma declaração de divulgação de risco semelhante à exigida pela regra de varejo CFTCs, mas adaptado para tratar determinadas características exclusivas de varejo forex em instituições bancárias. A declaração de risco prescrita descreve os riscos associados às transações de varejo no forex. A declaração de divulgação deixa claro que uma instituição bancária que deseje usar o direito de compensação para coletar margens ou cobrir perdas decorrentes de transações de varejo de forex deve incluir esse direito na declaração de divulgação de risco e obter reconhecimento escrito separado Na secção 240.9). As regras finais da CFTC, OCC e FDIC exigem que os revendedores de varejo de forex divulguem aos clientes de varejo a porcentagem de contas de varejo do forex que obtiveram lucros e a porcentagem de tais contas que sofreram uma perda durante cada um dos últimos quatro calendários Quartos. 30 O comentarista individual sugeriu que este ldquoprofitable contas ratiordquo poderia ser manipulado, embora ele não descreveu como isso poderia ser feito, e recomendou a adoção de uma metodologia de cálculo objetivo e uniforme para a relação. O comentarista também recomendou que o cálculo deve ser ponderado pelo valor do lucro ou perda para mostrar o montante da rentabilidade ou perda, em vez de apenas se qualquer conta fez qualquer lucro. The Board believes a calculation of the amount of profitability would be more likely to cause retail customers to believe that past performance is an indication of future results and is retaining the profitable accounts ratio and statement of profitable trades as proposed. In addition, the Board believes a uniform calculation of profitable accounts and statement of profitable trades for all retail forex dealers affords greater retail consumer protection by allowing comparison across different types of dealers. Finally, the Board notes that section 240.7(b) provides a calculation methodology for the profitable accounts ratio that is uniform across the bank regulatory agencies. 31 As proposed, the risk disclosure must be provided as a separate document. The Board requested comment on whether banking institutions should be allowed to combine the retail forex risk disclosure with other disclosures that banking institutions make to their customers. The individual commenter supported the Boards proposal, which is consistent with the final rules adopted by the other bank regulatory agencies. The individual commenter sought clarification as to whether the requirement in section 240.6(f) that the banking institution disclose ldquoany fee, charge, or commissionrdquo imposed on the customer for retail forex transactions includes spreads. The final rules adopted by the OCC and FDIC both require disclosure of ldquoany fee, charge, spread, or commissionrdquo and the individual commenter recommended that the Board add the word ldquospreadrdquo to its rules. The Board believes that spreads are covered by the proposed language, but is adding the word ldquospreadsrdquo to this section to make such coverage explicit. The individual commenter also asked for confirmation that the disclosure of ldquoany fee, charge, or commissionrdquo includes interest income on the retail forex account or retail forex transaction. The rate of interest income paid on cash margin is not a fee, charge, spread, or commission, and so is not required to be disclosed under section 240.6. Section 240.7mdashRecordkeeping This section specifies which documents and records a banking institution engaged in retail forex transactions must retain for examination by the Board. Banking institutions are required to maintain retail forex account records, financial ledgers, transactions records, daily records, order tickets, and records showing allocations and noncash margin, as well as records relating to possible violations of law. This section also prescribes document maintenance standards, including the manner and length of maintenance. Finally, this section requires banking institutions to record and maintain transaction records and make them available to customers. The individual commenter suggested that records required under this section be retained by the retail forex dealer forever, rather than the minimum five year period specified in section 240.7(h). The Board does not believe it is appropriate to require records be maintained indefinitely and notes that the five year period is consistent with retention requirements for many supervision and regulation records required by the Board. This section is being adopted as proposed. Section 240.8mdashCapital Requirements The Boards retail forex rule does not change the Boards regulations regarding capital. This section generally requires that a banking institution that offers or enters into retail forex transactions must be ldquowell capitalizedrdquo as defined in the Boards Regulations H, Y and LLthinsp 32 or the banking institution must obtain an exemption from the Board. An uninsured state-licensed U. S. branch or agency of a foreign bank must apply the capital rules that are made applicable to it pursuant to section 225.2(r)(3) of the Boards Regulation Y. 33 An Edge corporation or agreement corporation must comply with the capital adequacy guidelines that are made applicable to an Edge corporation engaged in banking pursuant to section 211.12(c)(2) of the Boards Regulation K. 34 In addition, a banking institution must continue to hold capital against retail forex transactions as provided in the Boards regulations. The Board received no comments to this section and adopts it as proposed. Section 240.9mdashMargin Requirements Paragraph (a) requires a banking institution that engages in retail forex transactions, in advance of any such transaction, to collect from the retail forex customer margin equal to at least two percent of the notional value of the Start Printed Page 21024 retail forex transaction if the transaction is in a major currency pair, and at least five percent of the notional value of the retail forex transaction otherwise. These margin requirements are identical to the requirements imposed by the retail forex rules of the CFTC, OCC, and FDIC. A major currency pair is a currency pair with two major currencies. The major currencies specified in the regulation are the U. S. Dollar (USD), Canadian Dollar (CAD), Euro (EUR), United Kingdom Pound (GBP), Japanese Yen (JPY), Swiss franc (CHF), New Zealand Dollar (NZD), Australian Dollar (AUD), Swedish Kronor (SEK), Danish Kroner (DKK), and Norwegian Krone (NOK), 35 as well as any other currency as determined by the Board. Prior to implementation of the CFTCs rule, non-bank dealers routinely permitted customers to trade with 1 percent margin (leverage of 100:1) and sometimes with as little as 0.25 percent margin (leverage of 400:1). When the CFTC proposed its retail forex rule in January 2010, it proposed a margin requirement of 10 percent (leverage of 10:1). In response to comments, the CFTC reduced the required margin in the final rule to 2 percent (leverage of 50:1) for trades involving major currencies and 5 percent (leverage of 20:1) for trades involving non-major currencies. These margin requirements were also adopted by the OCC and FDIC. The Board received no comments regarding the appropriate level of margin and is adopting the same requirements as the CFTC and other bank regulatory agencies. Paragraph (b) specifies the acceptable forms of margin that customers may post, including margin pledged in excess of the requirements of paragraph (a). Banking institutions must establish policies and procedures providing for haircuts for noncash margin collected from customers and must review these haircuts annually. It may be prudent for banking institutions to review and modify the size of the haircuts more frequently. Paragraph (c) requires a banking institution to collect additional margin from the customer or to liquidate the customers position if the amount of margin held by the banking institution fails to meet the requirements of paragraph (a). The proposed rule requires the banking institution to mark the customers open retail forex positions and the value of the customers margin to the market daily to ensure that a retail forex customer does not accumulate substantial losses not covered by margin. The retail forex regulations adopted by the OCC and FDIC both prohibit set-off, i. e. . the bank forex dealer is prohibited from applying a retail forex customers losses against any asset or liability of the retail forex customer other than money or property given as margin. Banks generally have broad rights to set off mutual debts to cover customer obligations. It is not clear that limiting a banks right of set-off in these particular transactions would provide appropriate incentives for retail forex customers. The Boards proposed rule did not include this prohibition and no comments were received opposing this proposal. The Board is adopting these provisions as proposed. In order to effectuate the prohibition against a bank retail forex dealer exercising a right of set-off, the OCC and FDIC require that each customers retail forex transaction margin be held in a separate account that holds only that customers retail forex transaction margin. As proposed, the Board is not requiring the use of a separate margin account, as it is not prohibiting a banking institution from exercising a right of set-off. Section 240.10mdashRequired reporting to customers This section requires a banking institution engaging in retail forex transactions to provide each retail forex customer confirmations and monthly statements, and describes the information to be included. The Board received no comments to this section and adopts it as proposed. Section 240.11mdashUnlawful Representations This section prohibits a banking institution and its related persons from representing that the Federal government, the Board, or any other Federal agency has sponsored, recommended, or approved retail forex transactions or products in any way. This section also prohibits a banking institution from implying or representing that it will guarantee against or limit retail forex customer losses or not collect margin as required by section 240.9. This section does not prohibit a banking institution from sharing in a loss resulting from error or mishandling of an order, and guaranties entered into prior to the effectiveness of the prohibition would only be affected if an attempt is made to extend, modify, or renew them. This section also does not prohibit a banking institution from hedging or otherwise mitigating its own exposure to retail forex transactions or any other foreign exchange risk. The Board received no comments to this section and adopts it as proposed. Section 240.12mdashAuthorization to Trade This section requires a banking institution to have specific authorization from a retail forex customer before effecting a retail forex transaction for that customer. The Board received no comments to this section and adopts it as proposed. Section 240.13mdashTrading and Operational Standards This section largely follows the trading standards of the retail forex rules adopted by the CFTC, OCC and FDIC, which were developed to prevent some of the deceptive or unfair practices identified by the CFTC and the National Futures Association. Under paragraph (a), a banking institution engaging in retail forex transactions is required to establish and enforce internal rules, procedures and controls to prevent front running, in which transactions in accounts of the banking institution or its related persons are executed before a similar customer order, and to establish settlement prices fairly and objectively. Paragraph (b) prohibits a banking institution engaging in retail forex transactions from disclosing that it holds another persons order unless disclosure is necessary for execution or is made at the Boards request. Paragraph (c) ensures that related persons of another retail forex counterparty do not open accounts with a banking institution without the knowledge and authorization of the account surveillance personnel of the other retail forex counterparty to which they are affiliated. Similarly, paragraph (d) ensures that related persons of a banking institution do not open accounts with other retail forex counterparties without the knowledge and authorization of the account surveillance personnel of the banking institution to which they are affiliated. Paragraph (e) prohibits a banking institution engaging in retail forex transactions from (1) Entering a retail forex transaction to be executed at a price that is not at or near prices at which other retail forex customers have executed materially similar transactions with the banking institution during the same time period, (2) changing prices after confirmation, (3) providing a retail forex customer with a new bid price that is higher (or lower) than previously provided without providing a new ask Start Printed Page 21025 price that is similarly higher (or lower) as well, and (4) establishing a new position for a retail forex customer (except to offset an existing position) if the banking institution holds one or more outstanding orders of other retail forex customers for the same currency pair at a comparable price. Paragraphs (e)(3) and (e)(4) do not prevent a banking institution from changing the bid or ask prices of a retail forex transaction to respond to market events. The Board understands that market practice among CFTC-registrants is not to offer requotes, but to simply reject orders and advise customers they may submit a new order (which the dealer may or may not accept). Similarly, a banking institution may reject an order and advise customers they may submit a new order. Paragraph (e)(5) requires a banking institution to use consistent market prices for customers executing retail forex transactions during the same time. It also prevents a banking institution from offering preferred execution to some of its retail forex customers but not others. The Board received no comments to this section and adopts it as proposed. Section 240.14mdashSupervision This section imposes on a banking institution and its agents, officers, and employees a duty to supervise subordinates with responsibility for retail forex transactions to ensure compliance with the Boards retail forex rule. The Board received no comments to this section and adopts it as proposed. Section 240.15mdashNotice of Transfers This section describes the requirements for transferring a retail forex account. Generally, a banking institution must provide retail forex customers 30 days prior notice before transferring or assigning their account. Affected customers may then instruct the banking institution to transfer the account to an institution of their choosing or liquidate the account. There are three exceptions to the above notice requirement: a transfer in connection with the receivership or conservatorship under the Federal Deposit Insurance Act a transfer pursuant to a retail forex customers specific request and a transfer otherwise allowed by applicable law. A banking institution that is the transferee of retail forex accounts must generally provide the transferred customers with the risk disclosure statement of section 240.6 and obtain each affected customers written acknowledgement within 60 days. The Board received no comments to this section and adopts it as proposed. Section 240.16mdashCustomer Dispute Resolution This section prohibits a banking institution from entering into any agreement or understanding with a retail forex customer in which the customer agrees, prior to the time a claim or grievance arises, to submit the claim or grievance to any settlement procedure. This provision differs from the applicable CFTC and OCC dispute settlement procedures, which permit mandatory pre-dispute settlement agreements under certain conditions. 36 The Board proposed to prohibit a banking institution from entering into a pre-dispute settlement agreement with a retail forex customer, similar to the final rule adopted by the FDIC. The Department of State has advised that transactions between the foreign branch or office of a banking institution and a U. S. customer could be cross-border transactions subject to the New Yorkthinsp 37 and Panama Conventions. 38 These Conventions, implemented in the United States by chapters 2 and 3 of the Federal Arbitration Act (FAA), 39 create treaty obligations to enforce international commercial arbitration agreements and to recognize and enforce international commercial arbitral awards. The Board is amending section 240.16 to provide that it will not apply to transactions covered by chapters 2 or 3 of the FAA. Section 240.17mdashReservation of Authority. This section allows the Board to modify certain requirements of this rule consistent with safety and soundness and the protection of retail forex customers. The Board understands the need for flexibility as foreign exchange trading procedures develop and to ensure that such products or trading procedures are subject to appropriate customer protection and safety and soundness standards. Interagency Statement on Retail Sales of Nondeposit Investment Products For banking institutions, the requirements in the Boards retail forex regulation overlap with applicable expectations contained in the Interagency Statement on Retail Sales of Nondeposit Investment Products (NDIP Policy Statement). 40 The NDIP Policy Statement sets out guidance regarding the Boards expectations when a banking institution engages in the sale of nondeposit investment products to retail customers. The NDIP Policy Statement addresses issues such as disclosure, suitability, sales practices, compensation, and compliance. The Board views retail forex transactions as nondeposit investment products, but the terms ldquoretail forex customerrdquo in this rule and ldquoretail customerrdquo in the NDIP Policy Statement are not necessarily co-extensive. The Board requested comment on whether the proposed regulation created issues concerning application of the NDIP policy statement to retail forex transactions that the Board should address. The Board received no comments on this issue. As the Board noted in its proposal, after the effective date of the final rule, the Board will expect banking institutions engaging in or offering retail forex transactions to also comply with the NDIP Policy Statement to the extent such compliance does not conflict with the requirements of the Boards final retail forex rule. III. Regulatory Analysis A. Regulatory Flexibility Act In accordance with Section 4(a) of the Regulatory Flexibility Act, 5 U. S.C. 601 et seq, (RFA), the Board must publish a final regulatory flexibility analysis with this rulemaking. The RFA requires an agency either to provide a final regulatory flexibility analysis with a final rule for which a general notice of proposed rulemaking is required or to certify that the final rule will not have a significant economic impact on a substantial number of small entities. Based on this analysis and for the reasons stated below, the Board believes that the final rule would not have a significant economic impact on a substantial number of small entities. Nevertheless, the Board is publishing a final regulatory flexibility analysis. 1. A succinct statement of the need for, and objectives of, the rule. Section 2(c)(2)(E) of the Commodity Exchange Act (7 U. S.C. 2 (c)(2)(E)) Start Printed Page 21026 prohibits a U. S. financial institution from conducting certain retail foreign exchange transactions unless done pursuant a rule or regulation of a Federal regulatory agency allowing such transactions. The Board is adopting a new regulation to allow banking institutions under its supervision to engage in retail foreign exchange transactions. 2. A Summary of the Significant Issues Raised by the Public Comments in Response to the Initial Regulatory Flexibility Analysis, a Summary of the Assessment of the Agency of Such Issues, and a Statement of Any Changes Made in the Proposed Rule as a Result of Such Comments The Board requested comment on required reporting, disclosure, and recordkeeping requirements for all banking institutions engaging in retail foreign exchange transactions and has solicited comment on any approaches that would reduce the burden on all counterparties, including small entities. In response to the notice of proposed rulemaking, the Board received no comments with respect to RFA. 3. A Description of and an Estimate of the Number of Small Entities To Which the Rule Will Apply or an Explanation of Why No Such Estimate Is Available Under regulations issued by the Small Business Administration, a banking institution is considered a ldquosmall entityrdquo if it has assets of 175 million or less. 41 As of June 30, 2012, there were approximately 368 small state member banks, 6 small Edge Act and agreement corporations, 48 small uninsured branches of foreign banks, 3,736 small bank holding companies, 213 small financial holding companies, and 229 small saving and loan holding companies. The Board is not aware of any small institutions engaged in retail forex transactions. 4. A Description of the Projected Reporting, Recordkeeping, and Other Compliance Requirements of the Rule, Including an Estimate of the Classes of Small Entities Which Will Be Subject to the Requirement and the Type of Professional Skills Necessary for Preparation of the Report or Record A description of the projected recordkeeping and other compliance requirements can be found below in section B, ldquoPaperwork Reduction Act, rdquo under the following headings: Reporting Requirements, Disclosure Requirements, and Recordkeeping Requirements. The Board believes that there are no other compliance requirements for this rule. 5. A Description of the Steps the Agency Has Taken To Minimize the Significant Economic Impact on Small Entities Consistent With the Stated Objectives of Applicable Statutes, Including a Statement of the Factual, Policy, and Legal Reasons for Selecting the Alternative Adopted in the Final Rule and Why Each One of the Other Significant Alternatives to the Rule Considered by the Agency Which Affect the Impact on Small Entities Was Rejected The Board believes that no Federal rules duplicate, overlap, or conflict with the rule. The Board has solicited comments on the proposed rule and received relatively few comments. The Board did not receive any comments from small entities and is unaware of any small entities that will be affected by the rule. The Boards rule is consistent with other banking regulators that also solicited comment on their rules. As noted in the supplementary information above, retail forex transactions are also subject to the Interagency Statement on Retail Sales of Nondeposit Investment Products, but this rule would govern to the extent of a conflict. B. Paperwork Reduction Act In accordance with section 3512 of the Paperwork Reduction Act (PRA) of 1995 (44 U. S.C. 3501 -3521), the Board may not conduct or sponsor, and a respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number. The Board reviewed the final rule under the authority delegated to the Board by OMB. The OMB control number for these information collections will be assigned. The Board received no comments regarding the Paperwork Reduction Act implications of its retail forex regulation. Title of Information Collection: Reporting, recordkeeping, and disclosure requirements associated with Regulation NN. Frequency of Response: On occasion. Affected Public: Businesses or other for-profit. Respondents: Agreement corporations, Edge Act corporations, state member banks, uninsured branches of foreign banks, financial holding companies, and bank holding companies (collectively, ldquobanking institutionsrdquo). Abstract: The information collection requirements of the final rule are found in sectsectthinsp240.4-240.7, 240.9-240.10, 240.13, 240.15-240.16. Reporting Requirements The reporting requirements in sectthinsp240.4 require that, prior to initiating a retail forex business, a banking institution provide the Board with prior notice. The notice must certify that the banking institution has written policies and procedures, and risk measurement and management systems in controls in place to ensure that retail forex transactions are conducted in a safe and sound manner. The banking institution must also provide other information required by the Board, such as documentation of customer due diligence, new product approvals, and haircuts applied to noncash margins. A banking institution already engaging in a retail forex business may continue to do so, provided it requests an extension of time. Disclosure Requirements Section 240.5, regarding the application and closing out of offsetting long and short positions, requires a banking institution to promptly provide the customer with a statement reflecting the financial result of the transactions and the name of the introducing broker to the account. The customer may provide specific written instructions on how the offsetting transaction should be applied. Section 240.6 requires that a banking institution furnish a retail forex customer with a written disclosure before opening an account that will engage in retail forex transactions for a retail forex customer and receive an acknowledgment from the customer that it was received and understood. It also requires the disclosure by a banking institution of its fees and other charges and its profitable accounts ratio. Section 240.10 requires a banking institution to issue monthly statements to each retail forex customer and to send confirmation statements following transactions. Section 240.13(b) allows disclosure by a banking institution that an order of another person is being held by them only when necessary to the effective execution of the order or when the disclosure is requested by the Board. Section 240.13(c) prohibits a banking institution engaging in retail forex transactions from knowingly handling the account of any related person of another retail forex counterparty unless it receives proper written authorization, promptly prepares a written record of the order, and transmits to the counterparty copies all statements and written records. Section 240.13(d) Start Printed Page 21027 prohibits a related person of a banking institution engaging in forex transactions from having an account with another retail forex counterparty unless it receives proper written authorization and copies of all statements and written records for such accounts are transmitted to the counterparty. Section 240.15 requires a banking institution to provide a retail forex customer with 30 days prior notice of any assignment of any position or transfer of any account of the retail forex customer. It also requires a banking institution to which retail forex accounts or positions are assigned or transferred to provide the affected customers with risk disclosure statements and forms of acknowledgment and receive the signed acknowledgments within 60 days. The customer dispute resolution provisions in sectthinsp240.16 requires certain endorsements, acknowledgments, and signature language. It also requires that within 10 days after receipt of notice from the retail forex customer that they intend to submit a claim to arbitration, the banking institution will provide them with a list of persons qualified in the dispute resolution and that the customer must notify the banking institution of the person selected within 45 days of receipt of such list. Recordkeeping Requirements Sections 240.7 and 240.13(a) require that a banking institution engaging in retail forex transactions keep full, complete, and systematic records and establish and implement internal rules, procedures, and controls. Section 240.7 also requires that a banking institution keep account, financial ledger, transaction and daily records, as well as memorandum orders, post-execution allocation of bunched orders, records regarding its ratio of profitable accounts, possible violations of law, records for noncash margin, and monthly statements and confirmations. Section 240.9 requires policies and procedures for haircuts for noncash margin collected under the rules margin requirements, and annual evaluations and modifications of the haircuts. Estimated PRA Burden Number of Respondents: 5 banking institutions 2 service providers. Estimated Average Hours per Response: 16 hours reporting burden 787 hours disclosure burden and 183 hours recordkeeping burden Total Estimated Annual Burden: 6,870 hours (80 hours reporting burden 5,509 hours disclosure burden and 1,281 hours recordkeeping burden). The Board has a continuing interest in the publics opinions of collections of information. At any time, comments regarding the burden estimate, or any other aspect of this collection of information, including suggestions for reducing the burden, may be sent to: Secretary, Board of Governors of the Federal Reserve System, 20th and C Streets NW. Washington, DC 20551 and to the Office of Management and Budget, Paperwork Reduction Project, Washington, DC 20503. C. Plain Language Section 722 of the Gramm-Leach-Bliley Act requires the Board to use plain language in all proposed and final rules published after January 1, 2000. No commenters suggested that the proposed rule was materially unclear, and the Board believes that the Final Rule is substantively similar to the proposed rule. Start List of Subjects List of Subjects in 12 CFR Part 240 For the reasons stated in the preamble, the Board amends 12 CFR Chapter II by adding new part 240 to read as follows: PART 240mdashRETAIL FOREIGN EXCHANGE TRANSACTIONS (REGULATION NN) 240.1 Authority, purpose, and scope. 240.2 Definitions. 240.3 Prohibited transactions. 240.4 Notification. 240.5 Application and closing out of offsetting long and short positions. 240.6 Disclosure. 240.7 Recordkeeping. 240.8 Capital requirements. 240.9 Margin requirements. 240.10 Required reporting to customers. 240.11 Unlawful representations. 240.12 Authorization to trade. 240.13 Trading and operational standards. 240.14 Supervision. 240.15 Notice of transfers. 240.16 Customer dispute resolution. 240.17 Reservation of authority. Authority, purpose and scope. (a) Authority. This part is issued by the Board of Governors of the Federal Reserve System (the Board) under the authority of section 2(c)(2)(E) of the Commodity Exchange Act (7 U. S.C. 2 (c)(2)(E)), sections 9 and 11 of the Federal Reserve Act (12 U. S.C. 321 -338 and 248), section 5(b) of the Bank Holding Company Act of 1956 (12 U. S.C. 1844 (b)), sections 9 and 13a of the International Banking Act of 1978 (12 U. S.C. 3106 a and 3108), and sections 3(q) and 8 of the Federal Deposit Insurance Act (12 U. S.C. 1813 (q) and 1818). (b) Purpose. This part establishes rules applicable to retail foreign exchange transactions engaged in by banking institutions on or after May 13, 2013. (c) Scope. Except as provided in paragraph (d) of this section, this part applies to banking institutions, as defined in section 240.2(b) of this part, and any branches or offices of those institutions wherever located. This part applies to subsidiaries of banking institutions organized under the laws of the United States or any U. S. state that are not subject to the jurisdiction of another federal regulatory agency authorized to prescribe rules or regulations under section 2(c)(2)(E) of the Commodity Exchange Act (7 U. S.C. (2)(c)(2)(E)). (d) International applicability. Sections 240.3 and 240.5 through 240.16 do not apply to retail foreign exchange transactions between a foreign branch or office of a banking institution and a non-U. S. customer. With respect to those transactions, the foreign branch or office remains subject to any disclosure, recordkeeping, capital, margin, reporting, business conduct, documentation, and other requirements of applicable foreign law. For purposes of this part, the following terms have the same meaning as in the Commodity Exchange Act (7 U. S.C. 1 et seq.): ldquoaffiliated person of a futures commission merchantrdquo ldquoassociated personrdquo ldquocontract of salerdquo ldquocommodityrdquo ldquofutures commission merchantrdquo ldquofuture deliveryrdquo ldquooptionrdquo ldquosecurityrdquo and ldquosecurity futures product. rdquo (a) Affiliate has the same meaning as in section 2(k) of the Bank Holding Company Act of 1956 (12 U. S.C. 1841 (k)). (b) Banking institution means: (1) A state member bank (as defined in 12 CFR 208.2 ) (2) An uninsured state-licensed U. S. branch or agency of a foreign bank (3) A financial holding company (as defined in section 2 of the Bank Holding Company Act of 1956 12 U. S.C. 1841 ) (4) A bank holding company (as defined in section 2 of the Bank Holding Company Act of 1956 12 U. S.C. 1841 ) Start Printed Page 21028 (5) A savings and loan holding company (as defined in section 10 of the Home Owners Loan Act 12 U. S.C. 1467 a) (6) A corporation operating under the fifth undesignated paragraph of section 25 of the Federal Reserve Act (12 U. S.C. 603 ), commonly known as ldquoan agreement corporationrdquo and (7) A corporation organized under section 25A of the Federal Reserve Act (12 U. S.C. 611 et seq.), commonly known as an ldquoEdge Act corporation. rdquo (c) Commodity Exchange Act means the Commodity Exchange Act (7 U. S.C. 1 et seq. ). (d) Eligible contract participant has the same meaning as in the Commodity Exchange Act (7 U. S.C. 1 et seq., as implemented in 17 CFR 1.3 (m). (e) Forex means foreign exchange. (f) Identified banking product has the same meaning as in section 401(b) of the Legal Certainty for Bank Products Act of 2000 (7 U. S.C. 27 (b)). (g) Institution-affiliated party or IAP has the same meaning as in 12 U. S.C. 1813 (u)(1), (2), or (3). (h) Introducing broker means any person who solicits or accepts orders from a retail forex customer in connection with retail forex transactions. (i) Related person, when used in reference to a retail forex counterparty, means: (1) Any general partner, officer, director, or owner of ten percent or more of the capital stock of the retail forex counterparty (2) An associated person or employee of the retail forex counterparty, if the retail forex counterparty is not an insured depository institution (3) An IAP, if the retail forex counterparty is an insured depository institution and (4) Any relative or spouse of any of the foregoing persons, or any relative of such spouse, who shares the same home as any of the foregoing persons. (j) Retail foreign exchange dealer means any person other than a retail forex customer that is, or that offers to be, the counterparty to a retail forex transaction, except for a person described in item (aa), (bb), (cc)(AA), (dd), or (ff) of section 2(c)(2)(B)(i)(II) of the Commodity Exchange Act (7 U. S.C. 2 (c)(2)(B)(i)(II)). (k) Retail forex account means the account of a retail forex customer, established with a banking institution, in which retail forex transactions with the banking institution as counterparty are undertaken, or the account of a retail forex customer that is established in order to enter into such transactions. (l) Retail forex account agreement means the contractual agreement between a banking institution and a retail forex customer that contains the terms governing the customers retail forex account with the banking institution. (m) Retail forex business means engaging in one or more retail forex transactions with the intent to derive income from those transactions, either directly or indirectly. (n) Retail forex counterparty includes, as appropriate: (1) A banking institution (2) A retail foreign exchange dealer (3) A futures commission merchant (4) An affiliated person of a futures commission merchant and (5) A broker or dealer registered under section 15(b) (except paragraph (11) thereof) or 15C of the Securities Exchange Act of 1934 (15 U. S.C. 78 o(b), 78o-5) or a U. S. financial institution other than a banking institution, provided the counterparty is subject to a rule or regulation of a Federal regulatory agency covering retail forex transactions. (o) Retail forex customer means a customer that is not an eligible contract participant, acting on his, her, or its own behalf and engaging in retail forex transactions. (p) Retail forex proprietary account means a retail forex account carried on the books of a banking institution for one of the following persons a retail forex account of which 10 percent or more is owned by one of the following persons or a retail forex account of which an aggregate of 10 percent or more of which is owned by more than one of the following persons: (1) The banking institution (2) An officer, director or owner of ten percent or more of the capital stock of the banking institution or (3) An employee of the banking institution, whose duties include: (i) The management of the banking institutions business (ii) The handling of the banking institutions retail forex transactions (iii) The keeping of records, including without limitation the software used to make or maintain those records, pertaining to the banking institutions retail forex transactions or (iv) The signing or co-signing of checks or drafts on behalf of the banking institution (4) A spouse or minor dependent living in the same household as of any of the foregoing persons or (5) An affiliate of the banking institution (q) Retail forex transaction means an agreement, contract, or transaction in foreign currency, other than an identified banking product or a part of an identified banking product, that is offered or entered into by a banking institution with a person that is not an eligible contract participant and that is: (1) A contract of sale of a commodity for future delivery or an option on such a contract or (2) 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. 78 f(a)) or (3) Offered or entered into on a leveraged or margined basis, or financed by a banking institution, its affiliate, or any person acting in concert with the banking institution or its affiliate on a similar basis, other than: (i) A security that is not a security futures product as defined in section 1a(47) of the Commodity Exchange Act (7 U. S.C. 1 a(47)) or (ii) A contract of sale thatmdash (A) Results in actual delivery within two days or (B) Creates an enforceable obligation to deliver between a seller and buyer that have the ability to deliver and accept delivery, respectively, in connection with their line of business or (iii) An agreement, contract, or transaction that the Board determines is not functionally or economically similar to an agreement, contract, or transaction described in paragraph (p)(1) or (p)(2) of this section. (a) Fraudulent conduct prohibited. No banking institution or its related persons may, directly or indirectly, in or in connection with any retail forex transaction: (1) Cheat or defraud or attempt to cheat or defraud any person (2) Knowingly make or cause to be made to any person any false report or statement or cause to be entered for any person any false record or (3) Knowingly deceive or attempt to deceive any person by any means whatsoever. (b) Acting as counterparty and exercising discretion prohibited. A banking institution that has authority to cause retail forex transactions to be effected for a retail forex customer without the retail forex customers specific authorization may not (and an affiliate of such an institution may not) act as the counterparty for any retail forex transaction with that retail forex customer. (a) Notification required. Before commencing a retail forex business, a Start Printed Page 21029 banking institution shall provide the Board with prior written notice in compliance with this section. The notice will become effective 60 days after a complete notice is received by the Board, provided the Board does not request additional information or object in writing. In the event the Board requests additional information, the notice will become effective 60 days after all information requested by the Board is received by the Board unless the Board objects in writing. (b) Notification requirements. A banking institution shall provide the following in its written notification: (1) Information concerning customer due diligence, including without limitation credit evaluations, customer appropriateness, and ldquoknow your customerrdquo documentation (2) The haircuts to be applied to noncash margin as provided in 240.9(b)(2) (3) Information concerning new product approvals (4) Information on addressing conflicts of interest and (5) A resolution by the banking institutions Board of Directors that the banking institution has established and implemented written policies, procedures, and risk measurement and management systems and controls for the purpose of ensuring that it conducts retail forex transactions in a safe and sound manner and in compliance with this part. (c) Treatment of existing retail forex businesses. A banking institution that is engaged in a retail forex business on the effective date of this part may continue to do so, until and unless the Board objects in writing, so long as the institution submits the information required to be submitted under paragraphs (b)(1) through (5) of this section within 30 days of the effective date of this part, subject to an extension of time by the Board, and such additional information as requested by the Board thereafter. (d) Compliance with the Commodity Exchange Act. A banking institution that is engaged in a retail forex business on the effective date of this part and complies with paragraph (c) of this section shall be deemed to be acting pursuant to a rule or regulation described in section 2(c)(2)(E)(ii)(I) of the Commodity Exchange Act (7 U. S.C. 2 (c)(2)(E)(ii)(I)). Application and closing out of offsetting long and short positions. (a) Application of purchases and sales. Any banking institution thatmdash (1) Engages in a retail forex transaction involving the purchase of any currency for the account of any retail forex customer when the account of such retail forex customer at the time of such purchase has an open retail forex transaction for the sale of the same currency (2) Engages in a retail forex transaction involving the sale of any currency for the account of any retail forex customer when the account of such retail forex customer at the time of such sale has an open retail forex transaction for the purchase of the same currency (3) Purchases a put or call option involving foreign currency for the account of any retail forex customer when the account of such retail forex customer at the time of such purchase has a short put or call option position with the same underlying currency, strike price, and expiration date as that purchased or (4) Sells a put or call option involving foreign currency for the account of any retail forex customer when the account of such retail forex customer at the time of such sale has a long put or call option position with the same underlying currency, strike price, and expiration date as that sold shall: (i) Immediately apply such purchase or sale against such previously held opposite transaction with the same customer and (ii) Promptly furnish such retail forex customer with a statement showing the financial result of the transactions involved and the name of any introducing broker to the account. (b) Close-out against oldest open position. In all instances in which the short or long position in a customers retail forex account immediately prior to an offsetting purchase or sale is greater than the quantity purchased or sold, the banking institution shall apply such offsetting purchase or sale to the oldest portion of the previously held short or long position. (c) Transactions to be applied as directed by customer. Notwithstanding paragraphs (a) and (b) of this section, the offsetting transaction shall be applied as directed by a retail forex customers specific instructions. These instructions may not be made by the banking institution or a related person. (a) Risk disclosure statement required. No banking institution may open or maintain an account for a retail forex customer for the purpose of engaging in retail forex transactions unless the banking institution has furnished the retail forex customer with a separate written disclosure statement containing only the language set forth in paragraph (d) of this section and the disclosures required by paragraphs (e), (f), and (g) of this section. (b) Acknowledgement of risk disclosure statement required. The banking institution must receive from the retail forex customer a written acknowledgement signed and dated by the customer that the customer received and understood the written disclosure statement required by paragraph (a) of this section. (c) Placement of risk disclosure statement. The disclosure statement may be attached to other documents as the initial page(s) of such documents and as the only material on such page(s). (d) Content of risk disclosure statement. The language set forth in the written disclosure statement required by paragraph (a) of this section shall be as follows: Risk Disclosure Statement Retail forex transactions generally involve the leveraged trading of contracts denominated in foreign currency with a banking institution as your counterparty. Because of the leverage and the other risks disclosed here, you can rapidly lose all of the funds or property you give the banking institution as margin for such trading and you may lose more than you pledge as margin. You should be aware of and carefully consider the following points before determining whether such trading is appropriate for you. (1) Trading foreign currencies is a not on a regulated market or exchangemdashyour banking institution is your trading counterparty and has conflicting interests. The retail forex transaction you are entering into is not conducted on an interbank market, nor is it conducted on a futures exchange subject to regulation by the Commodity Futures Trading Commission. The foreign currency trades you transact are trades with your banking institution as the counterparty. When you sell, the banking institution is the buyer. When you buy, the banking institution is the seller. As a result, when you lose money trading, your banking institution is making money on such trades, in addition to any fees, commissions, or spreads the banking institution may charge. (2) Any electronic trading platform that you may use for retail foreign currency transactions with your banking institution is not a regulated exchange. It is an electronic connection for accessing your banking institution. The terms of availability of such a platform are governed only by your contract with your banking institution. Any trading platform that you may use to enter into off-exchange foreign currency transactions is only connected to your banking institution. You are accessing that trading platform only to transact with your banking institution. You are not trading with any other entities or customers of the banking institution by accessing such platform. The availability and operation of any such platform, including the consequences of the unavailability of the Start Printed Page 21030 trading platform for any reason, is governed only by the terms of your account agreement with the banking institution. (3) You may be able to offset or liquidate any trading positions only through your banking institution because the transactions are not made on an exchange, and your banking institution may set its own prices. Your ability to close your transactions or offset positions is limited to what your banking institution will offer to you, as there is no other market for these transactions. Your banking institution may offer any prices it wishes. Your banking institution may establish its prices by offering spreads from third party prices, but it is under no obligation to do so or to continue to do so. Your banking institution may offer different prices to different customers at any point in time on its own terms. The terms of your account agreement alone govern the obligations your banking institution has to you to offer prices and offer offset or liquidating transactions in your account and make any payments to you. The prices offered by your banking institution may or may not reflect prices available elsewhere at any exchange, interbank, or other market for foreign currency. (4) Paid solicitors may have undisclosed conflicts. The banking institution may compensate introducing brokers for introducing your account in ways that are not disclosed to you. Such paid solicitors are not required to have, and may not have, any special expertise in trading, and may have conflicts of interest based on the method by which they are compensated. You should thoroughly investigate the manner in which all such solicitors are compensated and be very cautious in granting any person or entity authority to trade on your behalf. You should always consider obtaining dated written confirmation of any information you are relying on from your banking institution in making any trading or account decisions. (5) Retail forex transactions are not insured by the Federal Deposit Insurance Corporation. (6) Retail forex transactions are not a deposit in, or guaranteed by, a banking institution. (7) Retail forex transactions are subject to investment risks, including possible loss of all amounts invested. Finally, you should thoroughly investigate any statements by any banking institution that minimize the importance of, or contradict, any of the terms of this risk disclosure. Such statements may indicate sales fraud. This brief statement cannot, of course, disclose all the risks and other aspects of trading off-exchange foreign currency with a banking institution. I hereby acknowledge that I have received and understood this risk disclosure statement. Signature of Customer (e)(1) Disclosure of profitable accounts ratio. Immediately following the language set forth in paragraph (d) of this section, the statement required by paragraph (a) of this section shall include, for each of the most recent four calendar quarters during which the banking institution maintained retail forex customer accounts: (i) The total number of retail forex customer accounts maintained by the banking institution over which the banking institution does not exercise investment discretion (ii) The percentage of such accounts that were profitable for retail forex customer accounts during the quarter and (iii) The percentage of such accounts that were not profitable for retail forex customer accounts during the quarter. (2) Statement of profitable trades. (i) The banking institutions statement of profitable trades shall include the following legend: Past performance is not necessarily indicative of future results. (ii) Each banking institution shall provide, upon request, to any retail forex customer or prospective retail forex customer the total number of retail forex accounts maintained by the banking institution for which the banking institution does not exercise investment discretion, the percentage of such accounts that were profitable, and the percentage of such accounts that were not profitable for each calendar quarter during the most recent five-year period during which the banking institution maintained such accounts. (f) Disclosure of fees and other charges. Immediately following the language required by paragraph (e) of this section, the statement required by paragraph (a) of this section shall include: (1) The amount of any fee, charge, spread, or commission that the banking institution may impose on the retail forex customer in connection with a retail forex account or retail forex transaction (2) An explanation of how the banking institution will determine the amount of such fees, charges, spreads, or commissions and (3) The circumstances under which the banking institution may impose such fees, charges, spreads, or commissions. (g) Set-off. Immediately following the language required by paragraph (f) of this section, the statement required by paragraph (a) of this section shall include: (1) A statement as to whether the banking institution will or will not retain the right to set off obligations of the retail forex customer arising from the customers retail forex transactions, including margin calls and losses, against the customers other assets held by the banking institution (2) If the banking institution states that it reserves its right to set off obligations of the retail forex customer arising from the customers retail forex transactions against the customers other assets, the banking institution must receive from the retail forex customer a written acknowledgement signed and dated by the customer that the customer received and understood the written disclosure required by paragraph (g)(1) of this section. (h) Future disclosure requirements. If, with regard to a retail forex customer, the banking institution changes any fee, charge, or commission required to be disclosed under paragraph (f) of this section, then the banking institution shall mail or deliver to the retail forex customer a notice of the changes at least 15 days prior to the effective date of the change. (i) Form of disclosure requirements. The disclosures required by this section shall be clear and conspicuous and designed to call attention to the nature and significance of the information provided. (j) Other disclosure requirements unaffected. This section does not relieve a banking institution from any other disclosure obligation it may have under applicable law. (a) General rule. A banking institution engaging in retail forex transactions shall keep full, complete and systematic records, together with all pertinent data and memoranda, of all transactions relating to its retail forex business, including: (1) Retail forex account records. For each retail forex account: (i) The name and address of the person for whom such retail forex account is carried or introduced and the principal occupation or business of the person (ii) The name of any other person guaranteeing the account or exercising trading control with respect to the account (iii) The establishment or termination of the account (iv) A means to identify the person who has solicited and is responsible for the account or assign account numbers in such a manner as to identify that person (v) The funds in the account, net of any commissions and fees (vi) The accounts net profits and losses on open trades (vii) The funds in the account plus or minus the net profits and losses on open trades, adjusted for the net option value in the case of open options positions Start Printed Page 21031 (viii) Financial ledger records that show separately for each retail forex customer all charges against and credits to such retail forex customers account, including but not limited to retail forex customer funds deposited, withdrawn, or transferred, and charges or credits resulting from losses or gains on closed transactions and (ix) A list of all retail forex transactions executed for the account, with the details specified in paragraph (a)(2) of this section. (2) Retail forex transaction records. For each retail forex transaction: (i) The date and time the banking institution received the order (ii) The price at which the banking institution placed the order, or, in the case of an option, the premium that the retail forex customer paid (iii) The customer account identification information (iv) The currency pair (v) The size or quantity of the order (vi) Whether the order was a buy or sell order (vii) The type of order, if the order was not a market order (viii) The size and price at which the order is executed, or in the case of an option, the amount of the premium paid for each option purchased, or the amount credited for each option sold (ix) For options, whether the option is a put or call, expiration date, quantity, underlying contract for future delivery or underlying physical, strike price, and details of the purchase price of the option, including premium, mark-up, commission, and fees (x) For futures, the delivery date and (xi) If the order was made on a trading platform: (A) The price quoted on the trading platform when the order was placed, or, in the case of an option, the premium quoted (B) The date and time the order was transmitted to the trading platform and (C) The date and time the order was executed. (3) Price changes on a trading platform. If a trading platform is used, daily logs showing each price change on the platform, the time of the change to the nearest second, and the trading volume at that time and price. (4) Methods or algorithms. Any method or algorithm used to determine the bid or asked price for any retail forex transaction or the prices at which customers orders are executed, including, but not limited to, any mark-ups, fees, commissions or other items which affect the profitability or risk of loss of a retail forex customers transaction. (5) Daily records which show for each business day complete details of: (i) All retail forex transactions that are futures transactions executed on that day, including the date, price, quantity, market, currency pair, delivery date, and the person for whom such transaction was made (ii) All retail forex transactions that are option transactions executed on that day, including the date, whether the transaction involved a put or call, the expiration date, quantity, currency pair, delivery date, strike price, details of the purchase price of the option, including premium, mark-up, commission and fees, and the person for whom the transaction was made and (iii) All other retail forex transactions executed on that day for such account, including the date, price, quantity, currency and the person for whom such transaction was made. (6) Other records. Written acknowledgements of receipt of the risk disclosure statement required by sectthinsp240.6(b), offset instructions pursuant to sectthinsp240.5(c), records required under paragraphs (b) through (f) of this section, trading cards, signature cards, street books, journals, ledgers, payment records, copies of statements of purchase, and all other records, data and memoranda that have been prepared in the course of the banking institutions retail forex business. (b) Ratio of profitable accounts. (1) With respect to its active retail forex customer accounts over which it did not exercise investment discretion and that are not retail forex proprietary accounts open for any period of time during the quarter, a banking institution shall prepare and maintain on a quarterly basis (calendar quarter): (i) A calculation of the percentage of such accounts that were profitable (ii) A calculation of the percentage of such accounts that were not profitable and (iii) Data supporting the calculations described in paragraphs (b)(1)(i) and (b)(1)(ii) of this section. (2) In calculating whether a retail forex account was profitable or not profitable during the quarter, the banking institution shall compute the realized and unrealized gains or losses on all retail forex transactions carried in the retail forex account at any time during the quarter, and subtract all fees, commissions, and any other charges posted to the retail forex account during the quarter, and add any interest income and other income or rebates credited to the retail forex account during the quarter. All deposits and withdrawals of funds made by the retail forex customer during the quarter must be excluded from the computation of whether the retail forex account was profitable or not profitable during the quarter. Computations that result in a zero or negative number shall be considered a retail forex account that was not profitable. Computations that result in a positive number shall be considered a retail forex account that was profitable. (3) A retail forex account shall be considered ldquoactiverdquo for purposes of paragraph (b)(1) of this section if and only if, for the relevant calendar quarter, a retail forex transaction was executed in that account or the retail forex account contained an open position resulting from a retail forex transaction. (c) Records related to possible violations of law. A banking institution engaging in retail forex transactions shall make a record of all communications received by the banking institution or its related persons concerning facts giving rise to possible violations of law related to the banking institutions retail forex business. The record shall contain: the name of the complainant, if provided the date of the communication the relevant agreement, contract, or transaction the substance of the communication and the name of the person who received the communication and the final disposition of the matter. (d) Records for noncash margin. A banking institution shall maintain a record of all noncash margin collected pursuant to sectthinsp240.9. The record shall show separately for each retail forex customer: (1) A description of the securities or property received (2) The name and address of such retail forex customer (3) The dates when the securities or property were received (4) The identity of the depositories or other places where such securities or property are segregated or held, if applicable (5) The dates on which the banking institution placed or removed such securities or property into or from such depositories and (6) The dates of return of such securities or property to such retail forex customer, or other disposition thereof, together with the facts and circumstances of such other disposition. (e) Order tickets. (1) Except as provided in paragraph (e)(2) of this section, immediately upon the receipt of a retail forex transaction order, a banking institution shall prepare an order ticket for the order (whether unfulfilled, executed or canceled). The order ticket shall include: (i) Account identification (account or customer name with which the retail forex transaction was effected) Start Printed Page 21032 (ii) Order number (iii) Type of order (market order, limit order, or subject to special instructions) (iv) Date and time, to the nearest minute, the retail forex transaction order was received (as evidenced by timestamp or other timing device) (v) Time, to the nearest minute, the retail forex transaction order was executed and (vi) Price at which the retail forex transaction was executed. (2) Post-execution allocation of bunched orders. Specific identifiers for retail forex accounts included in bunched orders need not be recorded at time of order placement or upon report of execution as required under paragraph (e)(1) of this section if the following requirements are met: (i) The banking institution placing and directing the allocation of an order eligible for post-execution allocation has been granted written investment discretion with regard to participating customer accounts and makes the following information available to customers upon request: (A) The general nature of the post-execution allocation methodology the banking institution will use (B) Whether the banking institution has any interest in accounts which may be included with customer accounts in bunched orders eligible for post-execution allocation and (C) Summary or composite data sufficient for that customer to compare the customers results with those of other comparable customers and, if applicable, any account in which the banking institution has an interest. (ii) Post-execution allocations are made as soon as practicable after the entire transaction is executed (iii) Post-execution allocations are fair and equitable, with no account or group of accounts receiving consistently favorable or unfavorable treatment and (iv) The post-execution allocation methodology is sufficiently objective and specific to permit the Board to verify fairness of the allocations using that methodology. (f) Record of monthly statements and confirmations. A banking institution shall retain a copy of each monthly statement and confirmation required by sectthinsp240.10. (g) Form of record and manner of maintenance. The records required by this section must clearly and accurately reflect the information required and provide an adequate basis for the audit of the information. A banking institution must create and maintain audio recordings of oral orders and oral offset instructions. Record maintenance may include the use of automated or electronic records provided that the records are easily retrievable, and readily available for inspection. (h) Length of maintenance. A banking institution shall keep each record required by this section for at least five years from the date the record is created. (a) Capital required for a state member bank. A banking institution defined in section 240.2(b)(1) offering or entering into retail forex transactions must be well-capitalized as defined in section 208.43 of Regulation H (12 CFR 208.43 ). (b) Capital required for an uninsured state-licensed branch of a foreign bank. A banking institution defined in sectthinsp240.2(b)(2) offering or entering into retail forex transactions must be well-capitalized under the capital rules made applicable to it pursuant to sectthinsp225.2(r)(3) of Regulation Y (12 CFR 225.2 (r)(3)). (c) Capital required for financial holding companies and bank holding companies. A banking institution defined in sectthinsp240.2(b)(3) or (4) offering or entering into retail forex transactions must be well-capitalized as defined in sectthinsp225.2(r) of Regulation Y (12 CFR 225.2 (r)). (d) Capital required for savings and loan holding companies. A banking institution defined in sectthinsp240.2(b)(5) offering or entering into retail forex transactions must be well-capitalized as defined in sectthinsp238.2(s) of Regulation LL (12 CFR 238.2 (s)). (e) Capital required for an agreement corporation or Edge Act corporation. A banking institution defined in sectthinsp240.2(b)(6) or (7) offering or entering into retail forex transactions must maintain capital in compliance with the capital adequacy guidelines that are made applicable to an Edge corporation engaged in banking pursuant to sectthinsp211.12 (c)(2) of Regulation K (12 CFR 211.12 (c)(2)). (a) Margin required. A banking institution engaging, or offering to engage, in retail forex transactions must collect from each retail forex customer an amount of margin not less than: (1) Two percent of the notional value of the retail forex transaction for major currency pairs and 5 percent of the notional value of the retail forex transaction for all other currency pairs (2) For short options, 2 percent for major currency pairs and 5 percent for all other currency pairs of the notional value of the retail forex transaction, plus the premium received by the retail forex customer or (3) For long options, the full premium charged and received by the banking institution. (b)(1) Form of margin. Margin collected under paragraph (a) of this section or pledged by a retail forex customer for retail forex transactions in excess of the requirements of paragraph (a) of this section must be in the form of cash or the following financial instruments: (i) Obligations of the United States and obligations fully guaranteed as to principal and interest by the United States (ii) General obligations of any State or of any political subdivision thereof (iii) General obligations issued or guaranteed by any enterprise, as defined in 12 U. S.C. 4502 (10) (iv) Certificates of deposit issued by an insured depository institution, as defined in section 3(c)(2) of the Federal Deposit Insurance Act (12 U. S.C. 1813 (c)(2)) (v) Commercial paper (vi) Corporate notes or bonds (vii) General obligations of a sovereign nation (viii) Interests in money market mutual funds and (ix) Such other financial instruments as the Board deems appropriate. (2) Haircuts. A banking institution shall establish written policies and procedures that include: (i) Haircuts for noncash margin collected under this section and (ii) Annual evaluation, and, if appropriate, modification of the haircuts. (c) Major currencies. (1) for the purposes of paragraphs (a)(1) and (a)(2) of this section, major currency means: (i) United States Dollar (USD) (ii) Canadian Dollar (CAD) (iv) United Kingdom Pound (GBP) (v) Japanese Yen (JPY) (vi) Swiss Franc (CHF) (vii) New Zealand Dollar (NZD) (viii) Australian Dollar (AUD) (ix) Swedish Kronor (SEK) (x) Danish Kroner (DKK) (xi) Norwegian Krone (NOK), and (xii) Any other currency as determined by the Board. (d) Margin calls liquidation of position. For each retail forex customer, at least once per day, a banking institution shall: (1) Mark the value of the retail forex customers open retail forex positions to market (2) Mark the value of the margin collected under this section from the retail forex customer to market (3) Determine whether, based on the marks in paragraphs (d)(1) and (d)(2) of Start Printed Page 21033 this section, the banking institution has collected margin from the retail forex customer sufficient to satisfy the requirements of this section and (4) If, pursuant to paragraph (d)(3) of this section, the banking institution determines that it has not collected margin from the retail forex customer sufficient to satisfy the requirements of this section then, within a reasonable period of time, the banking institution shall either: (i) Collect margin from the retail forex customer sufficient to satisfy the requirements of this section or (ii) Liquidate the retail forex customers retail forex transactions. Required reporting to customers. (a) Monthly statements. Each banking institution must promptly furnish to each retail forex customer, as of the close of the last business day of each month or as of any regular monthly date selected, except for accounts in which there are neither open positions at the end of the statement period nor any changes to the account balance since the prior statement period, but in any event not less frequently than once every three months, a statement that clearly shows: (1) For each retail forex customer: (i) The open retail forex transactions with prices at which acquired (ii) The net unrealized profits or losses in all open retail forex transactions marked to the market (iii) Any money, securities or other property held as margin for retail forex transactions and (iv) A detailed accounting of all financial charges and credits to the retail forex customers retail forex accounts during the monthly reporting period, including: money, securities, or property received from or disbursed to such customer realized profits and losses and fees, charges, and commissions. (2) For each retail forex customer engaging in retail forex transactions that are options: (i) All such options purchased, sold, exercised, or expired during the monthly reporting period, identified by underlying retail forex transaction or underlying currency, strike price, transaction date, and expiration date (ii) The open option positions carried for such customer and arising as of the end of the monthly reporting period, identified by underlying retail forex transaction or underlying currency, strike price, transaction date, and expiration date (iii) All such option positions marked to the market and the amount each position is in the money, if any (iv) Any money, securities or other property held as margin for retail forex transactions and (v) A detailed accounting of all financial charges and credits to the retail forex customers retail forex accounts during the monthly reporting period, including: money, securities, or property received from or disbursed to such customer realized profits and losses premiums and mark-ups and fees, charges, and commissions. (b) Confirmation statement. Each banking institution must, not later than the next business day after any retail forex transaction, send: (1) To each retail forex customer, a written confirmation of each retail forex transaction caused to be executed by it for the customer, including offsetting transactions executed during the same business day and the rollover of an open retail forex transaction to the next business day (2) To each retail forex customer engaging in forex option transactions, a written confirmation of each forex option transaction, containing at least the following information: (i) The retail forex customers account identification number (ii) A separate listing of the actual amount of the premium, as well as each mark-up thereon, if applicable, and all other commissions, costs, fees and other charges incurred in connection with the forex option transaction (iii) The strike price (iv) The underlying retail forex transaction or underlying currency (v) The final exercise date of the forex option purchased or sold and (vi) The date the forex option transaction was executed. (3) To each retail forex customer engaging in forex option transactions, upon the expiration or exercise of any option, a written confirmation statement thereof, which statement shall include the date of such occurrence, a description of the option involved, and, in the case of exercise, the details of the retail forex or physical currency position which resulted therefrom including, if applicable, the final trading date of the retail forex transaction underlying the option. (c) Notwithstanding the provisions of paragraphs (b)(1) through (3) of this section, a retail forex transaction that is caused to be executed for a pooled investment vehicle that engages in retail forex transactions need be confirmed only to the operator of such pooled investment vehicle. (d) Controlled accounts. With respect to any account controlled by any person other than the retail forex customer for whom such account is carried, each banking institution shall promptly furnish in writing to such other person the information required by paragraphs (a) and (b) of this section. (e) Introduced accounts. Each statement provided pursuant to the provisions of this section must, if applicable, show that the account for which the banking institution was introduced by an introducing broker and the name of the introducing broker. (a) No implication or representation of limiting losses. No banking institution engaged in retail foreign exchange transactions or its related persons may imply or represent that it will, with respect to any retail customer forex account, for or on behalf of any person: (1) Guarantee such person or account against loss (2) Limit the loss of such person or account or (3) Not call for or attempt to collect margin as established for retail forex customers. (b) No implication of representation of engaging in prohibited acts. No banking institution or its related persons may in any way imply or represent that it will engage in any of the acts or practices described in paragraph (a) of this section. (c) No Federal government endorsement. No banking institution or its related persons may represent or imply in any manner whatsoever that any retail forex transaction or retail forex product has been sponsored, recommended, or approved by the Board, the Federal government, or any agency thereof. (d) Assuming or sharing of liability from bank error. This section shall not be construed to prevent a banking institution from assuming or sharing in the losses resulting from the banking institutions error or mishandling of a retail forex transaction. (e) Certain guaranties unaffected. This section shall not affect any guarantee entered into prior to the effective date of this part, but this section shall apply to any extension, modification or renewal thereof entered into after such date. Authorization to trade. (a) Specific authorization required. No banking institution may directly or indirectly effect a retail forex transaction for the account of any retail forex customer unless, before the transaction occurs, the retail forex customer specifically authorized the banking institution to effect the retail forex transaction. (b) A retail forex transaction is ldquospecifically authorizedrdquo for purposes Start Printed Page 21034 of this section if the retail forex customer specifies: (1) The precise retail forex transaction to be effected (2) The exact amount of the foreign currency to be purchased or sold and (3) In the case of an option, the identity of the foreign currency or contract that underlies the option. Trading and operational standards. (a) Internal rules, procedures, and controls required. A banking institution engaging in retail forex transactions shall establish and implement internal rules, procedures, and controls designed, at a minimum, to: (1) Ensure, to the extent reasonable, that each order received from a retail forex customer that is executable at or near the price that the banking institution has quoted to the customer is entered for execution before any order in any retail forex transaction for: (i) A proprietary account (ii) An account in which a related person has an interest, or any account for which such a related person may originate orders without the prior specific consent of the account owner, if the related person has gained knowledge of the retail forex customers order prior to the transmission of an order for a proprietary account (iii) An account in which a related person has an interest, if the related person has gained knowledge of the retail forex customers order prior to the transmission of an order for a proprietary account or (iv) An account in which a related person may originate orders without the prior specific consent of the account owner, if the related person has gained knowledge of the retail forex customers order prior to the transmission of an order for a proprietary account (2) Prevent banking institution related persons from placing orders, directly or indirectly, with another person in a manner designed to circumvent the provisions of paragraph (a)(1) of this section and (3) Fairly and objectively establish settlement prices for retail forex transactions. (b) Disclosure of retail forex transactions. No banking institution engaging in retail forex transactions may disclose that an order of another person is being held by the banking institution, unless the disclosure is necessary to the effective execution of such order or the disclosure is made at the request of the Board. (c) Handling of retail forex accounts of related persons of retail forex counterparties. No banking institution engaging in retail forex transactions shall knowingly handle the retail forex account of any related person of another retail forex counterparty unless the banking institution: (1) Receives written authorization from a person designated by such other retail forex counterparty with responsibility for the surveillance over such account (2) Prepares immediately upon receipt of an order for the account a written record of the order, including the account identification and order number, and records thereon to the nearest minute, by time-stamp or other timing device, the date and time the order is received and (3) Transmits on a regular basis to the other retail forex counterparty copies of all statements for the account and of all written records prepared upon the receipt of orders for the account pursuant to paragraph (c)(2) of this section. (d) Related person of banking institution establishing account at another retail forex counterparty. No related person of a banking institution working in the banking institutions retail forex business may have an account, directly or indirectly, with another retail forex counterparty unless the other retail forex counterparty: (1) Receives written authorization to open and maintain the account from a person designated by the banking institution of which it is a related person with responsibility for the surveillance over the account pursuant to paragraph (a)(2) of this section (2) Prepares immediately upon receipt of an order for the account a written record of the order, including the account identification and order number, and records thereon to the nearest minute, by time-stamp or other timing device, the date and time the order is received and (3) Transmits on a regular basis to the banking institution copies of all statements for the account and of all written records prepared by the other retail forex counterparty upon receipt of orders for such account pursuant to paragraph (d)(2) of this section. (e) Prohibited trading practices. No banking institution engaging in retail forex transactions may: (1) Enter into a retail forex transaction, to be executed pursuant to a market or limit order at a price that is not at or near the price at which other retail forex customers, during that same time period, have executed retail forex transactions with the banking institution (2) Adjust or alter prices for a retail forex transaction after the transaction has been confirmed to the retail forex customer (3) Provide a retail forex customer a new bid price for a retail forex transaction that is higher than its previous bid without providing a new asked price that is also higher than its previous asked price by a similar amount (4) Provide a retail forex customer a new bid price for a retail forex transaction that is lower than its previous bid without providing a new asked price that is also lower than its previous asked price by a similar amount or (5) Establish a new position for a retail forex customer (except one that offsets an existing position for that retail forex customer) where the banking institution holds outstanding orders of other retail forex customers for the same currency pair at a comparable price. (a) Supervision by the banking institution. A banking institution engaging in retail forex transactions shall diligently supervise the handling by its officers, employees, and agents (or persons occupying a similar status or performing a similar function) of all retail forex accounts carried, operated, or advised by the banking institution and all activities of its officers, employees, and agents (or persons occupying a similar status or performing a similar function) relating to its retail forex business. (b) Supervision by officers, employees, or agents. An officer, employee, or agent of a banking institution must diligently supervise his or her subordinates handling of all retail forex accounts at the banking institution and all the subordinates activities relating to the banking institutions retail forex business. Notice of transfers. (a) Prior notice generally required. Except as provided in paragraph (b) of this section, a banking institution must provide a retail forex customer with 30 days prior notice of any assignment of any position or transfer of any account of the retail forex customer. The notice must include a statement that the retail forex customer is not required to accept the proposed assignment or transfer and may direct the banking institution to liquidate the positions of the retail forex customer or transfer the account to a retail forex counterparty of the retail forex customers selection. (b) Exceptions. The requirements of paragraph (a) of this section shall not apply to transfers: Start Printed Page 21035 (1) Requested by the retail forex customer (2) Made by the Federal Deposit Insurance Corporation as receiver or conservator under the Federal Deposit Insurance Act or other law or (3) Otherwise authorized by applicable law. (c) Obligations of transferee banking institution. A banking institution to which retail forex accounts or positions are assigned or transferred under paragraph (a) of this section must provide to the affected retail forex customers the risk disclosure statements and forms of acknowledgment required by this part and receive the required signed acknowledgments within sixty days of such assignments or transfers. This requirement shall not apply if the banking institution has clear written evidence that the retail forex customer has received and acknowledged receipt of the required disclosure statements. Customer dispute resolution. (a) No banking institution shall enter into any agreement or understanding with a retail forex customer in which the customer agrees, prior to the time a claim or grievance arises, to submit any claim or grievance regarding any retail forex transaction or disclosure to any settlement procedure. (b) Election of forum. (1) Within 10 business days after the receipt of notice from the retail forex customer that the customer intends to submit a claim to arbitration, the banking institution shall provide the customer with a list of persons qualified in dispute resolution. (2) The customer must, within 45 days after receipt of such list, notify the banking institution of the person selected. The customers failure to provide such notice shall give the banking institution the right to select a person from the list. (c) Enforceability. A dispute settlement procedure may require parties using the procedure to agree, under applicable state law, submission agreement, or otherwise, to be bound by an award rendered in the procedure if the agreement to submit the claim or grievance to the procedure was made after the claim or grievance arose. Any award so rendered by the procedure will be enforceable in accordance with applicable law. (d) Time limits for submission of claims. The dispute settlement procedure used by the parties may not include any unreasonably short limitation period foreclosing submission of a customers claims or grievances or counterclaims. (e) Counterclaims. A procedure for the settlement of a retail forex customers claims or grievances against a banking institution or employee thereof may permit the submission of a counterclaim in the procedure by a person against whom a claim or grievance is brought if the counterclaim: (1) Arises out of the transaction or occurrence that is the subject of the retail forex customers claim or grievance and (2) Does not require for adjudication the presence of essential witnesses, parties, or third persons over which the settlement process lacks jurisdiction. (f) Cross-border transactions. This section shall not apply to transactions within the scope of sections 202, 302, and 305 of the Federal Arbitration Act (9 U. S.C. 202. 302, and 305). Reservation of authority. The Board may modify the disclosure, recordkeeping, capital and margin, reporting, business conduct, documentation, or other standards or requirements under this part for a specific retail forex transaction or a class of retail forex transactions if the Board determines that the modification is consistent with safety and soundness and the protection of retail forex customers. End Part Start Signature By order of the Board of Governors of the Federal Reserve System, April 3, 2013. Margaret McCloskey Shanks, Deputy Secretary of the Board. End Signature End Supplemental Information Footnotes 2. thinspDodd-Frank Act sectthinsp742(c)(2) (codified at 7 U. S.C. 2 (c)(2)(E) (2011). 3. thinspThe CEA defines ldquofinancial institutionrdquo to include an agreement corporation, an Edge Act corporation, a depository institution (as defined in section 3 of the Federal Deposit Insurance Act), a financial holding company (as defined in section 2 of the Bank Holding Company Act of 1956), a trust company, or ldquoa similarly regulated subsidiary or affiliate of an entityrdquo described above. 7 U. S.C. 1 a(21). 4. thinspFor purposes of the retail forex rules, ldquoFederal regulatory agencyrdquo includes ldquoan appropriate Federal banking agency. rdquo 7 U. S.C. 2 (c)(2)(E)(i)(III). The Board is an ldquoappropriate Federal banking agencyrdquo under the CEA. 7 U. S.C. 1 a(2). 5. thinspA retail customer is a person who is not an ldquoeligible contract participantrdquo under the CEA. See, 7 U. S.C. 1 a(18). 10. thinspThe Boards proposed rule did not explicitly cover savings and loan holding companies (SLHCs). They have been added to the regulation to reflect the transfer to the Board of regulatory responsibility for SLHCs on July 21, 2011. 11. thinsp Regulation of Off-Exchange Retail Foreign Exchange Transactions and Intermediaries, 75 FR 55409 (Sept. 10, 2010) (Final CFTC Retail Forex Rule). The CFTC proposed these rules prior to the enactment of the Dodd-Frank Act. Regulation of Off-Exchange Retail Foreign Exchange Transactions and Intermediaries, 75 FR 3281 (Jan. 20, 2010) (Proposed CFTC Retail Forex Rule). 13. thinsp7 U. S.C. 2 (c)(2)(E). The federal regulatory authorities other than the Board are the CFTC, OCC, FDIC, the Securities and Exchange Commission, the National Credit Union Association, and the Farm Credit Administration. 14. thinspThe definition of ldquoeligible contract participantrdquo is found in section 1a(18) of the CEA and is discussed below. 17. thinsp See generally, CFTC v. Intl Fin. Servs. (New York), Inc., 323 F. Supp. 2d 482, 495 (S. D.N. Y. 2004) (distinguishing between foreign exchange futures contracts and spot contracts in foreign exchange, and noting that foreign currency trades settled within two days are ordinarily spot transactions rather than futures contracts) see also Bank Brussels Lambert v. Intermetals Corp., 779 F. Supp. 741, 748 (S. D.N. Y. 1991). 18. thinsp See generally, CFTC v. Intl Fin. Servs. (New York), Inc., 323 F. Supp. 2d 482, 495 (S. D.N. Y. 2004) (distinguishing between forward contracts in foreign exchange and foreign exchange futures contracts) see also William L. Stein, The Exchange-Trading Requirement of the Commodity Exchange Act, 41 Vand. L. Rev. 473, 491 (1988). In contrast to forward contracts, futures contracts generally include several or all of the following characteristics: (i) Standardized nonnegotiable terms (other than price and quantity) (ii) parties are required to deposit initial margin to secure their obligations under the contract (iii) parties are obligated and entitled to pay or receive variation margin in the amount of gain or loss on the position periodically over the period the contract is outstanding (iv) purchasers and sellers are permitted to close out their positions by selling or purchasing offsetting contracts and (v) settlement may be provided for by either (a) cash payment through a clearing entity that acts as the counterparty to both sides of the contract without delivery of the underlying commodity or (b) physical delivery of the underlying commodity. See, Edward F. Greene et al. U. S. Regulation of International Securities and Derivatives Markets sectthinsp14.082 (8th ed. 2006). 20. thinsp CFTC v. Zelener, 373 F.3d 861 (7th Cir. 2004) see also CFTC v. Erskine, 512 F.3rd 309 (6th Cir. 2008). 21. thinspFor example, in Zelener, the retail forex dealer retained the right, at the date of delivery of the currency to deliver the currency, roll the transaction over, or offset all or a portion of the transaction with another open position held by the customer. See CFTC v. Zelener, 373 F.3d 861, 869 (7th Cir. 2004). 22. thinsp See, e. g. CFTC v. Erskine, 512 F.3d 309, 326 (6th Cir. 2008) CFTC v. Zelener, 373 F.3d 861, 869 (7th Cir. 2004). 23. thinspThe term ldquoeligible contract participantrdquo is defined at 7 U. S.C. 1 a(18) and generally requires a corporation, partnership, proprietorship, organization, trust or other entity to have total assets exceeding 10 million and an individual to have more than 10 million in assets invested on a discretionary basis. 24. thinsp Further Definition of ldquoSwap Dealer, rdquo ldquoSecurity-Based Swap Dealer, rdquo ldquoMajor Swap Participantrdquo and ldquoEligible Contract Participant, rdquo 75 FR 80174 (December 21, 2010)(joint proposed rule with the SEC). 35. thinsp See National Futures Association, Forex Transaction: A Regulatory Guide 17 (Feb. 2011) New York Federal Reserve Bank, Survey of North American Foreign Exchange Volume tbl. 3e (Jan. 2011) Bank for International Settlements, Report on Global Foreign Exchange Market Activity in 2010 at 15 tbl. B.6 (Dec. 2010). 36. thinspSee 17 CFR 166.5. The CFTCs regulation permits predispute dispute settlement agreements with a customer with certain restrictions such as that signing the agreement must not be made a condition for the customer to utilize the services offered by the CFTC registrant. 37. thinspConvention on the Recognition and Enforcement of Foreign Arbitral Awards (1970). 38. thinspInter-American Convention on International Commercial Arbitration (1990). 39. thinsp9 U. S.C. 1 et seq. Chapter 2 of the FAA (secs. 201-208) contains provisions implementing the New York Convention, while Chapter 3 of the FAA (secs. 301mdash307) contains provisions implementing the Panama Convention. 40. thinsp See SR Letter 94-11 (Feb. 17, 1994) see also SR Letter 95-46 (Sept. 14, 1995). 41. thinspU. S. Small Business Administration, Table of Small Business Size Matched to North American Industry Classification System Codes, 13 CFR 121.201 . FR Doc. 2013-08163 Filed 4-8-13 8:45 am BILLING CODE 6210-01-P