95-16230. Foreign Option Transactions  

  • [Federal Register Volume 60, Number 127 (Monday, July 3, 1995)]
    [Rules and Regulations]
    [Pages 34458-34459]
    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
    [FR Doc No: 95-16230]
    
    
    
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    COMMODITY FUTURES TRADING COMMISSION
    
    17 CFR Part 30
    
    
    Foreign Option Transactions
    
    AGENCY: Commodity Futures Trading Commission.
    
    ACTION: Order.
    
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    SUMMARY: The Commodity Futures Trading Commission (Commission) is 
    issuing this Order pursuant to which option contracts on a spot foreign 
    exchange operation between the Great Britain Pound and the Deutsche 
    Mark (GBP/DEM) and the Deutsche Mark and the Italian Lira (DEM/ITL) 
    traded on the Marche a Terme International de France (MATIF) may be 
    offered or sold to persons located in the United States. This Order is 
    issued pursuant to: (1) Commission rule 30.3(a), 17 CFR 30.3(a), which 
    makes it unlawful for any person to engage in the offer or sale of a 
    foreign option product until the Commission, by order, authorizes such 
    foreign option to be offered or sold in the United States; and (2) the 
    procedures established in the Commission's Order issued on June 6, 
    1990, 55 FR 23902 (June 13, 1990) (Mutual Recognition Memorandum of 
    Understanding (MRMOU) with the French Commission des Operations de 
    Bourse).
    
    EFFECTIVE DATE: August 2, 1995.
    
    FOR FURTHER INFORMATION CONTACT: Francey L. Youngberg, Esq., Division 
    of Trading and Markets, Commodity Futures Trading Commission, 2033 K 
    Street NW., Washington, D.C. 20581. Telephone: (202) 254-8955
    
    SUPPLEMENTARY INFORMATION: The Commission has issued the following 
    Order:
    
    UNITED STATES OF AMERICA
    
    BEFORE THE
    
    COMMODITY FUTURES TRADING COMMISSION
    
        Order Pursuant to the Mutual Recognition Memorandum of 
    Understanding with the French Commission des Operations de Bourse 
    and Rule 30.3(a) Permitting Option Contracts on the GBP/DEM and DEM/
    ITL Traded on the Marche a Terme International de France (MATIF) To 
    Be Offered or Sold to Persons Located in the United States Thirty 
    Days After Publication of This Notice in the Federal Register Absent 
    Further Notice
    
        By Order issued on December 17, 1991 (Initial Order),1 the 
    Commission authorized, pursuant to the Mutual Recognition Memorandum 
    of Understanding (MRMOU) 2 and Commission rule 30.3(a),3 
    certain option products traded on the MATIF to be offered or sold in 
    the United States.
    
        \1\ See 56 FR 66345 (December 23, 1991).
        \2\ See 55 FR 23902 (June 13, 1990). Among other things, this 
    arrangement provides a mechanism pursuant to which certain option 
    products traded on the Marche a Terme International de France 
    (MATIF) may be offered or sold to customers resident in the United 
    States thirty days after publication in the Federal Register of a 
    notice specifying the particular option contracts to be offered or 
    sold.
        \3\ Commission rule 30.3(a), 17 CFR 30.3(a), makes it unlawful 
    for any person to engage in the offer or sale of a foreign option 
    product until the Commission, by order, authorizes such foreign 
    option to be offered or sold in the United States.
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        By letter dated May 17, 1995, MATIF notified the Commission that on 
    May 22, 1995 it would be introducing option contracts based on the GBP/
    DEM and DEM/ITL and requested that the Commission supplement its 
    Initial Order authorizing the offer and sale in the United States of 
    Options on the Notional Bond, the 3-month PIBOR, the 3-month EURODEM 
    Futures Contracts; a Supplemental Order, 57 FR 10987 (April 1, 1992), 
    authorizing the offer and sale in the United States of Options on the 
    Long-Term ECU Bond Futures Contracts; and a Supplemental Order, 59 FR 
    22971 (May 4, 1994), authorizing the offer and sale in the United 
    States of Options on the USD/DM and USD/FRF by also authorizing the 
    MATIF's Option Contracts on the GBP/DEM and DEM/ITL to be offered or 
    sold to persons located in the United States.4 Based upon the 
    foregoing, and pursuant to the terms of the MRMOU, the Commission 
    hereby publishes this Order in the Federal Register pursuant to which 
    the particular option contracts specified herein may be offered or sold 
    thirty days after the publication of this Order.
    
        \4\ See letter dated May 17, 1995 from Patrick Stephan, MATIF, 
    to Jane C. Kang, Commission and letter dated May 23, 1995 from 
    Frederic Perier, Commission des Operations de Bourse, to Andrea M. 
    Corcoran, Commission.
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        Accordingly, pursuant to Commission rule 30.3(a), 17 CFR 30.3(a), 
    and Article II, paragraph 6(b) and Article V, paragraph 6 of the MRMOU 
    signed by the Commission on June 6, 1990 (55 FR 23902 (June 13, 1990)), 
    and subject to the terms and conditions specified in the MRMOU, the 
    Commission hereby issues this Order pursuant to which option contracts 
    based on the GBP/DEM and DEM/ITL traded on the MATIF may be offered or 
    sold to persons located in the United States thirty days after 
    publication of this Order in the Federal Register, unless prior to that 
    date the Commission receives any comments which may result in a 
    determination to delay the effective date of the Order pending review 
    of such comments. Under such circumstances the Commission will provide 
    notice.
    Contract Specifications
    
    GBP/DEM Option (SDM)
    Type
        European style
    Underlying Interest
        Spot currency transaction GBP against DEM
    Contract Size
        GBP 50,000 
    
    [[Page 34459]]
    
    Strike Price
        Expressed in DEM, with 2 decimals.
        Strike price intervals: 2 Pfennigs (2.32-2.34)
        At least 11 closest-to-the-money (5 on each side)
    Quotation
        Premium in % of the GBP nominal, with 2 decimals.
        Ex: 0.45% stands for 0.45 x 500 = GBP 225
        In specific cases, premium with 3 decimals
    Tick
        Size: 0.01%
        Value: 0.01 x 500 = GBP 5
    Expiration
        3 monthly + 3 quarterly expirations from March (H), June (M), 
    September (U), December (Z)
    Last Trading Day
        Thursday following the 3rd Wednesday of expiration month at 9:00 am 
    (New York time)
    First Trading Day
        First business day following an expiration date
    Exercise
        After settlement of a spot-fixing on the expiration date, automatic 
    exercise of in-the-money options Exercise: exchange of underlying 
    currencies
    Trading Hours
        Open outcry: 9:15 am to 5:00 pm (Paris time)
        THS (after hours trading): 5:00 pm to 9:15 am
    DEM/ITL Option (MLI)
    Type
        European style
    Underlying Interest
        Spot currency transaction DEM against ITL
    Contract Size
        DEM 100,000
    Strike Price
        Expressed in ITL, without decimal.
        Strike price intervals: Liras 10 (1070-1080)
        At least 11 closest-to-the-money (5 on each side)
    Quotation
        Premium in % of the DEM nominal, with 2 decimals.
        Ex: 0.45% stands for 100,000 x 0.45/100 = DEM 450
        In specific cases, premium with 3 decimals
    Tick
        Size: 0.01%
        Value: 0.01/100 x 100,000 = DEM 10
    Expiration
        3 monthly + 3 quarterly expirations from March (H), June (M), 
    September (U), December (Z)
    Last Trading Day
        Thursday following the 3rd Wednesday of expiration month at 9:00 am 
    (New York time)
    First Trading Day
        First business day following an expiration date
    Exercise
        After settlement of a spot-fixing on the expiration date, automatic 
    exercise of in-the-money options Exercise: exchange of underlying 
    currencies
    Trading Hours
        Open outcry: 9:15 am to 5:00 pm (Paris time)
        THS (after hours trading): 5:00 pm to 9:15 am
    
    List of Subjects in 17 CFR Part 30
    
        Commodity futures, Commodity options, Foreign transactions.
    
        Accordingly, 17 CFR Part 30 is amended as set forth below:
    
    PART 30--FOREIGN FUTURES AND FOREIGN OPTION TRANSACTIONS
    
        1. The authority citation for Part 30 continues to read as follows:
    
        Authority: Secs. 2(a)(1)(A), 4, 4c, and 8a of the Commodity 
    Exchange Act, 7 U.S.C. 2, 6, 6c and 12a.
    
        2. Appendix B to Part 30 is amended by adding the following entry 
    after the existing entries for the ``Marche a Terme International de 
    France'' to read as follows:
    
      Appendix B.--Option Contracts Permitted To Be Offered or Sold in the  
                         U.S. Pursuant to Sec.  30.3(a)                     
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            Exchange              Type of contract      FR date and citation
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                      *        *        *        *        *                 
    Marche a Terme            Option Contracts on       July 3, 1995; XX FR 
     International de France.  Great Britain Pound and   XX                 
                               the Deutsche Mark (GBP/                      
                               DEM) and the Deutsche                        
                               Mark and Italian Lira                        
                               (DEM/ITL).                                   
                                                                            
                      *        *        *        *        *                 
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        Issued in Washington, D.C. on June 27, 1995.
    Jean A. Webb,
    Secretary to the Commission.
    [FR Doc. 95-16230 Filed 6-30-95; 8:45 am]
    BILLING CODE 6351-01-P
    
    

Document Information

Effective Date:
8/2/1995
Published:
07/03/1995
Department:
Commodity Futures Trading Commission
Entry Type:
Rule
Action:
Order.
Document Number:
95-16230
Dates:
August 2, 1995.
Pages:
34458-34459 (2 pages)
PDF File:
95-16230.pdf
CFR: (1)
17 CFR 30