§ 240.15b12-1 Brokers or dealers engaged in a retail forex business.  


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  • (a) Definitions. In addition to the definitions in this section, the following terms have the same meaning as in the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.): “broker,” “dealer,” “person,” “registered broker or dealer,” and “self-regulatory organization.”

    (1) Act means the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.).

    (2) 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.

    (3) Retail forex transaction means any account, agreement, contract or transaction in foreign currency that is offered or entered into by a broker or dealer with a person that is not an eligible contract participant as defined in section 1a(18) of the Commodity Exchange Act (7 U.S.C. 1a(18)) and that is:

    (i) A contract of sale of a commodity for future delivery or an option on such a contract;

    (ii) An option, other than an option executed or traded on a national securities exchange registered pursuant to section 6(a) of the Act (15 U.S.C. 78(f)(a)); or

    (iii) Offered, or entered into, on a leveraged or margined basis, or financed by a broker or dealer or any person acting in concert with the broker or dealer on a similar basis, other than:

    (A) A security that is not a security futures product as defined in section 1a(47) of the Commodity Exchange Act (7 U.S.C. 1a(47)); or

    (B) A contract of sale that:

    (1) Results in actual delivery within two days; or

    (2) 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.

    (b) Any registered broker or dealer may engage in a retail forex business provided that such broker or dealer complies with the Act, the rules and regulations thereunder, and the rules of the self-regulatory organization(s) of which the broker or dealer is a member, including, but not limited to, the disclosure, recordkeeping, capital and margin, reporting, business conduct, and documentation requirements, insofar as they are applicable to retail forex transactions.

    (c) Any registered broker or dealer that is engaged in a retail forex business in compliance with paragraph (b) of this section on or after the effective date 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)).

    (d) This section shall expire and no longer be effective on July 31, 2016.

    [78 FR 42450, July 16, 2013]

    Effective Date Note: At 78 FR 42450, July 16, 2013, §240.15b12-1 was added, effective July 16, 2013 through July 31, 2016.