83_FR_29668 83 FR 29546 - Fees for Reviews of the Rule Enforcement Programs of Designated Contract Markets and Registered Futures Associations

83 FR 29546 - Fees for Reviews of the Rule Enforcement Programs of Designated Contract Markets and Registered Futures Associations

COMMODITY FUTURES TRADING COMMISSION

Federal Register Volume 83, Issue 122 (June 25, 2018)

Page Range29546-29547
FR Document2018-13511

The Commodity Futures Trading Commission (``CFTC'' or ``Commission'') charges fees to designated contract markets and registered futures associations to recover the costs incurred by the Commission in the operation of its program of oversight of self- regulatory organization rule enforcement programs, specifically National Futures Association (``NFA''), a registered futures association, and the designated contract markets. Fees collected from each self-regulatory organization are deposited in the Treasury of the United States as miscellaneous receipts. The calculation of the fee amounts charged for 2017 by this notice is based upon an average of actual program costs incurred during fiscal year (``FY'') 2014, FY 2015, and FY 2016.

Federal Register, Volume 83 Issue 122 (Monday, June 25, 2018) 
[Federal Register Volume 83, Number 122 (Monday, June 25, 2018)]
[Notices]
[Pages 29546-29547]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-13511]



[[Page 29546]]

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COMMODITY FUTURES TRADING COMMISSION


Fees for Reviews of the Rule Enforcement Programs of Designated 
Contract Markets and Registered Futures Associations

AGENCY: Commodity Futures Trading Commission.

ACTION: Notice of 2017 schedule of fees.

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SUMMARY: The Commodity Futures Trading Commission (``CFTC'' or 
``Commission'') charges fees to designated contract markets and 
registered futures associations to recover the costs incurred by the 
Commission in the operation of its program of oversight of self-
regulatory organization rule enforcement programs, specifically 
National Futures Association (``NFA''), a registered futures 
association, and the designated contract markets. Fees collected from 
each self-regulatory organization are deposited in the Treasury of the 
United States as miscellaneous receipts. The calculation of the fee 
amounts charged for 2017 by this notice is based upon an average of 
actual program costs incurred during fiscal year (``FY'') 2014, FY 
2015, and FY 2016.

DATES: Each self-regulatory organization is required to remit 
electronically the applicable fee on or before August 24, 2018.

FOR FURTHER INFORMATION CONTACT: Mary Jean Buhler, Chief Financial 
Officer, Commodity Futures Trading Commission; (202) 418-5089; Three 
Lafayette Centre, 1155 21st Street NW, Washington, DC 20581. For 
information on electronic payment, contact Jennifer Fleming; (202) 418-
5034; Three Lafayette Centre, 1155 21st Street NW, Washington, DC 
20581.

SUPPLEMENTARY INFORMATION:

I. Background Information

A. General

    This notice relates to fees for the Commission's review of the rule 
enforcement programs at the registered futures associations \1\ and 
designated contract markets (``DCM''), each of which is a self-
regulatory organization (``SRO'') regulated by the Commission. The 
Commission recalculates the fees charged each year to cover the costs 
of operating this Commission program.\2\ The fees are set each year 
based on direct program costs, plus an overhead factor. The Commission 
calculates actual costs, then calculates an alternate fee taking volume 
into account, and then charges the lower of the two.\3\
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    \1\ National Futures Association is the only registered futures 
association.
    \2\ See Section 237 of the Futures Trading Act of 1982, 7 U.S.C. 
16a, and 31 U.S.C. 9701. For a broader discussion of the history of 
Commission fees, see 52 FR 46070, Dec. 4, 1987.
    \3\ 58 FR 42643, Aug. 11, 1993, and 17 CFR part 1, appendix B.
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B. Overhead Rate

    The fees charged by the Commission to the SROs are designed to 
recover program costs, including direct labor costs and overhead. The 
overhead rate is calculated by dividing total Commission-wide overhead 
direct program labor costs into the total amount of the Commission-wide 
overhead pool. For this purpose, direct program labor costs are the 
salary costs of personnel working in all Commission programs. Overhead 
costs generally consist of the following Commission-wide costs: 
Indirect personnel costs (leave and benefits), rent, communications, 
contract services, utilities, equipment, and supplies. This formula has 
resulted in the following overhead rates for the most recent three 
years (rounded to the nearest whole percent): 180 percent for FY 2014, 
211 percent for FY 2015, and 190 percent for FY 2016.

C. Conduct of SRO Rule Enforcement Reviews

    Under the formula adopted by the Commission in 1993, the Commission 
calculates the fee to recover the costs of its rule enforcement reviews 
and examinations, based on the three-year average of the actual cost of 
performing such reviews and examinations at each SRO. The cost of 
operation of the Commission's SRO oversight program varies from SRO to 
SRO, according to the size and complexity of each SRO's program. The 
three-year averaging computation method is intended to smooth out year-
to-year variations in cost. Timing of the Commission's reviews and 
examinations may affect costs--a review or examination may span two 
fiscal years and reviews and examinations are not conducted at each SRO 
each year.
    As noted above, adjustments to actual costs may be made to relieve 
the burden on an SRO with a disproportionately large share of program 
costs. The Commission's formula provides for a reduction in the 
assessed fee if an SRO has a smaller percentage of United States 
industry contract volume than its percentage of overall Commission 
oversight program costs. This adjustment reduces the costs so that, as 
a percentage of total Commission SRO oversight program costs, they are 
in line with the pro rata percentage for that SRO of United States 
industry-wide contract volume.
    The calculation is made as follows: The fee required to be paid to 
the Commission by each DCM is equal to the lesser of actual costs based 
on the three-year historical average of costs for that DCM or one-half 
of average costs incurred by the Commission for each DCM for the most 
recent three years, plus a pro rata share (based on average trading 
volume for the most recent three years) of the aggregate of average 
annual costs of all DCMs for the most recent three years.
    The formula for calculating the second factor is: 0.5a + 0.5 vt = 
current fee. In this formula, ``a'' equals the average annual costs, 
``v'' equals the percentage of total volume across DCMs over the last 
three years, and ``t'' equals the average annual costs for all DCMs. 
NFA has no contracts traded; hence, its fee is based simply on costs 
for the most recent three fiscal years. The following table summarizes 
the data used in the calculations of the resulting fee for each entity:

                                                    Table 1--Summary of Data Used in Fee Calculations
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                            Actual total costs              3-Year
                                                 ---------------------------------------   average       3-Year      Adjusted       2016         2017
                                                                                            actual      average       volume    Actual  fee    Assessed
                                                    FY 2014      FY 2015      FY 2016       costs     volume  (%)     costs                      fee
--------------------------------------------------------------------------------------------------------------------------------------------------------
CBOE Futures....................................  ...........     $158,209     $227,059     $128,423         1.31      $71,004      $73,074      $71,004
Chicago Board of Trade..........................      $55,515       17,938       28,720       34,058        29.61      170,554       79,476       34,058
Chicago Mercantile Exchange.....................      225,701      540,151      372,278      379,377        44.66      421,246      385,923      379,377
ICE Futures U.S.................................       81,176      105,864      386,719      191,253         9.22      143,431      153,429      143,431
Minneapolis Grain Exchange......................       47,648      147,983       14,314       69,981         0.05       35,250       69,741       35,250
NADEX North American............................          980  ...........       81,758       27,579         0.14       14,516       17,505       14,516

[[Page 29547]]

 
New York Mercantile Exchange....................      225,672      118,701      242,792      195,722        14.49      172,990      159,897      172,990
One Chicago.....................................       31,196          289          282       10,589         0.29        6,798       28,384        6,798
NASDAQ..........................................  ...........  ...........  ...........  ...........         0.21        1,089  ...........  ...........
ERIS Exchange...................................  ...........  ...........  ...........  ...........         0.01           68  ...........  ...........
NY LIFFE........................................  ...........  ...........  ...........  ...........  ...........  ...........        4,909  ...........
ELX Futures.....................................  ...........  ...........  ...........  ...........  ...........  ...........       22,378  ...........
KCBT............................................  ...........  ...........  ...........  ...........  ...........  ...........          186  ...........
                                                 -------------------------------------------------------------------------------------------------------
    Subtotal....................................      667,888    1,089,134    1,353,921   $1,036,981          100    1,036,945      994,901      857,423
National Futures Association....................      292,102      401,337      282,405      325,281  ...........  ...........      293,312      325,281
                                                 -------------------------------------------------------------------------------------------------------
        Total...................................      959,990    1,490,471    1,636,326    1,362,262  ...........  ...........   $1,288,214    1,182,704
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Note to Table 1: The 2017 Fee is the lesser of the 3-Year Average Actual Cost or the Adjusted Volume Cost. NY LIFFE, ELX, and KCBT are either Vacated or
  Dormant, but had direct labor costs in 2013 that produced a fee in 2016, based on the 3-Year Average.

    An example of how the fee is calculated for one exchange, the 
Chicago Board of Trade, is set forth here:
    a. Actual three-year average costs = $34,058.
    b. The alternative computation is: (.5) ($34,058) + (.5) (.2961) 
($1,036,981) = $170,554.
    c. The fee is the lesser of a or b; in this case $34,058.
    As noted above, the alternative calculation based on contracts 
traded is not applicable to NFA because it is not a DCM and has no 
contracts traded. The Commission's average annual cost for conducting 
oversight review of the NFA rule enforcement program during fiscal 
years 2014 through 2016 was $325,281. The fee to be paid by the NFA for 
the current fiscal year is $325,281.

II. Schedule of Fees

    Fees for the Commission's review of the rule enforcement programs 
at the registered futures associations and DCMs regulated by the 
Commission are as shown in the following table:

                                            Table 2--Schedule of Fees
----------------------------------------------------------------------------------------------------------------
                                                                                                     2017 Fee:
                                                      3-Year          3-Year         Adjusted        lesser of
                                                      average         average      volume  costs     actual or
                                                   actual costs     volume (%)                    calculated fee
----------------------------------------------------------------------------------------------------------------
CBOE Futures....................................        $128,423            1.31         $71,004         $71,004
Chicago Board of Trade..........................          34,058           29.61         170,554          34,058
Chicago Mercantile Exchange.....................         379,377           44.66         421,246         379,377
ICE Futures U.S.................................         191,253            9.22         143,431         143,431
Minneapolis Grain Exchange......................          69,981            0.05          35,250          35,250
NADEX North American............................          27,579            0.14          14,516          14,516
New York Mercantile Exchange....................         195,722           14.49         172,990         172,990
One Chicago.....................................          10,589            0.29           6,798           6,798
NASDAQ..........................................  ..............            0.21           1,089  ..............
ERIS Exchange...................................  ..............            0.01              68  ..............
NY LIFFE........................................  ..............  ..............  ..............  ..............
ELX Futures.....................................  ..............  ..............  ..............  ..............
KCBT............................................  ..............  ..............  ..............  ..............
                                                 ---------------------------------------------------------------
    Subtotal....................................       1,036,981             100       1,036,945         857,423
National Futures Association....................         325,281  ..............  ..............         325,281
                                                 ---------------------------------------------------------------
        Total...................................       1,362,262  ..............  ..............       1,182,704
----------------------------------------------------------------------------------------------------------------

III. Payment Method

    The Debt Collection Improvement Act (``DCIA'') requires deposits of 
fees owed to the government by electronic transfer of funds. See 31 
U.S.C. 3720. For information about electronic payments, please contact 
Jennifer Fleming at (202) 418-5034 or [email protected], or see the 
CFTC website at www.cftc.gov, specifically, www.cftc.gov/cftc/cftcelectronicpayments.htm.
    Fees collected from each self-regulatory organization shall be 
deposited in the Treasury of the United States as miscellaneous 
receipts. See 7 U.S.C. 16a.

    Issued in Washington, DC, on June 19, 2018, by the Commission.
Christopher Kirkpatrick,
Secretary of the Commission.
[FR Doc. 2018-13511 Filed 6-22-18; 8:45 am]
 BILLING CODE 6351-01-P

29546 Federal Register / Vol. 83, No. 122 / Monday, June 25, 2018 / Notices COMMODITY FUTURES TRADING enforcement programs at the registered program. The three-year averaging COMMISSION futures associations 1 and designated computation method is intended to contract markets (‘‘DCM’’), each of smooth out year-to-year variations in Fees for Reviews of the Rule which is a self-regulatory organization cost. Timing of the Commission’s Enforcement Programs of Designated (‘‘SRO’’) regulated by the Commission. reviews and examinations may affect Contract Markets and Registered The Commission recalculates the fees costs—a review or examination may Futures Associations charged each year to cover the costs of span two fiscal years and reviews and AGENCY: Commodity Futures Trading operating this Commission program.2 examinations are not conducted at each Commission. The fees are set each year based on SRO each year. direct program costs, plus an overhead ACTION: Notice of 2017 schedule of fees. As noted above, adjustments to actual factor. The Commission calculates costs may be made to relieve the burden SUMMARY: The Commodity Futures actual costs, then calculates an alternate on an SRO with a disproportionately Trading Commission (‘‘CFTC’’ or fee taking volume into account, and then charges the lower of the two.3 large share of program costs. The ‘‘Commission’’) charges fees to Commission’s formula provides for a designated contract markets and B. Overhead Rate reduction in the assessed fee if an SRO registered futures associations to recover has a smaller percentage of United the costs incurred by the Commission in The fees charged by the Commission to the SROs are designed to recover States industry contract volume than its the operation of its program of oversight percentage of overall Commission of self-regulatory organization rule program costs, including direct labor costs and overhead. The overhead rate oversight program costs. This enforcement programs, specifically is calculated by dividing total adjustment reduces the costs so that, as National Futures Association (‘‘NFA’’), a Commission-wide overhead direct a percentage of total Commission SRO registered futures association, and the program labor costs into the total oversight program costs, they are in line designated contract markets. Fees amount of the Commission-wide with the pro rata percentage for that collected from each self-regulatory organization are deposited in the overhead pool. For this purpose, direct SRO of United States industry-wide Treasury of the United States as program labor costs are the salary costs contract volume. miscellaneous receipts. The calculation of personnel working in all Commission The calculation is made as follows: of the fee amounts charged for 2017 by programs. Overhead costs generally The fee required to be paid to the this notice is based upon an average of consist of the following Commission- Commission by each DCM is equal to actual program costs incurred during wide costs: Indirect personnel costs the lesser of actual costs based on the fiscal year (‘‘FY’’) 2014, FY 2015, and (leave and benefits), rent, three-year historical average of costs for FY 2016. communications, contract services, that DCM or one-half of average costs DATES: Each self-regulatory organization utilities, equipment, and supplies. This incurred by the Commission for each is required to remit electronically the formula has resulted in the following DCM for the most recent three years, applicable fee on or before August 24, overhead rates for the most recent three plus a pro rata share (based on average 2018. years (rounded to the nearest whole trading volume for the most recent three percent): 180 percent for FY 2014, 211 years) of the aggregate of average annual FOR FURTHER INFORMATION CONTACT: percent for FY 2015, and 190 percent for costs of all DCMs for the most recent Mary Jean Buhler, Chief Financial FY 2016. three years. Officer, Commodity Futures Trading Commission; (202) 418–5089; Three C. Conduct of SRO Rule Enforcement The formula for calculating the Lafayette Centre, 1155 21st Street NW, Reviews second factor is: 0.5a + 0.5 vt = current Washington, DC 20581. For information Under the formula adopted by the fee. In this formula, ‘‘a’’ equals the on electronic payment, contact Jennifer Commission in 1993, the Commission average annual costs, ‘‘v’’ equals the Fleming; (202) 418–5034; Three calculates the fee to recover the costs of percentage of total volume across DCMs Lafayette Centre, 1155 21st Street NW, its rule enforcement reviews and over the last three years, and ‘‘t’’ equals Washington, DC 20581. examinations, based on the three-year the average annual costs for all DCMs. SUPPLEMENTARY INFORMATION: average of the actual cost of performing NFA has no contracts traded; hence, its I. Background Information such reviews and examinations at each fee is based simply on costs for the most SRO. The cost of operation of the recent three fiscal years. The following A. General Commission’s SRO oversight program table summarizes the data used in the This notice relates to fees for the varies from SRO to SRO, according to calculations of the resulting fee for each Commission’s review of the rule the size and complexity of each SRO’s entity: TABLE 1—SUMMARY OF DATA USED IN FEE CALCULATIONS Actual total costs 3-Year 3-Year Adjusted 2016 2017 average average volume Actual Assessed volume FY 2014 FY 2015 FY 2016 actual costs costs fee fee (%) CBOE Futures ................................................... .................... $158,209 $227,059 $128,423 1.31 $71,004 $73,074 $71,004 Chicago Board of Trade .................................... $55,515 17,938 28,720 34,058 29.61 170,554 79,476 34,058 Chicago Mercantile Exchange .......................... 225,701 540,151 372,278 379,377 44.66 421,246 385,923 379,377 amozie on DSK3GDR082PROD with NOTICES1 ICE Futures U.S ................................................ 81,176 105,864 386,719 191,253 9.22 143,431 153,429 143,431 Minneapolis Grain Exchange ............................ 47,648 147,983 14,314 69,981 0.05 35,250 69,741 35,250 NADEX North American .................................... 980 .................... 81,758 27,579 0.14 14,516 17,505 14,516 1 National Futures Association is the only 2 See Section 237 of the Futures Trading Act of 3 58 FR 42643, Aug. 11, 1993, and 17 CFR part registered futures association. 1982, 7 U.S.C. 16a, and 31 U.S.C. 9701. For a 1, appendix B. broader discussion of the history of Commission fees, see 52 FR 46070, Dec. 4, 1987. VerDate Sep<11>2014 17:58 Jun 22, 2018 Jkt 244001 PO 00000 Frm 00019 Fmt 4703 Sfmt 4703 E:\FR\FM\25JNN1.SGM 25JNN1

Federal Register / Vol. 83, No. 122 / Monday, June 25, 2018 / Notices 29547 TABLE 1—SUMMARY OF DATA USED IN FEE CALCULATIONS—Continued Actual total costs 3-Year 3-Year Adjusted 2016 2017 average average volume Actual Assessed volume FY 2014 FY 2015 FY 2016 actual costs costs fee fee (%) New York Mercantile Exchange ........................ 225,672 118,701 242,792 195,722 14.49 172,990 159,897 172,990 One Chicago ..................................................... 31,196 289 282 10,589 0.29 6,798 28,384 6,798 NASDAQ ........................................................... .................... .................... .................... .................... 0.21 1,089 .................... .................... ERIS Exchange ................................................. .................... .................... .................... .................... 0.01 68 .................... .................... NY LIFFE .......................................................... .................... .................... .................... .................... .................... .................... 4,909 .................... ELX Futures ...................................................... .................... .................... .................... .................... .................... .................... 22,378 .................... KCBT ................................................................. .................... .................... .................... .................... .................... .................... 186 .................... Subtotal ...................................................... 667,888 1,089,134 1,353,921 $1,036,981 100 1,036,945 994,901 857,423 National Futures Association ............................ 292,102 401,337 282,405 325,281 .................... .................... 293,312 325,281 Total .................................................... 959,990 1,490,471 1,636,326 1,362,262 .................... .................... $1,288,214 1,182,704 Note to Table 1: The 2017 Fee is the lesser of the 3-Year Average Actual Cost or the Adjusted Volume Cost. NY LIFFE, ELX, and KCBT are either Vacated or Dormant, but had direct labor costs in 2013 that produced a fee in 2016, based on the 3-Year Average. An example of how the fee is c. The fee is the lesser of a or b; in The fee to be paid by the NFA for the calculated for one exchange, the this case $34,058. current fiscal year is $325,281. Chicago Board of Trade, is set forth As noted above, the alternative calculation based on contracts traded is II. Schedule of Fees here: not applicable to NFA because it is not a. Actual three-year average costs = Fees for the Commission’s review of a DCM and has no contracts traded. The $34,058. the rule enforcement programs at the Commission’s average annual cost for b. The alternative computation is: (.5) conducting oversight review of the NFA registered futures associations and ($34,058) + (.5) (.2961) ($1,036,981) = rule enforcement program during fiscal DCMs regulated by the Commission are $170,554. years 2014 through 2016 was $325,281. as shown in the following table: TABLE 2—SCHEDULE OF FEES 3-Year 2017 Fee: 3-Year Adjusted average lesser of average volume volume actual or actual costs costs (%) calculated fee CBOE Futures ................................................................................................. $128,423 1.31 $71,004 $71,004 Chicago Board of Trade .................................................................................. 34,058 29.61 170,554 34,058 Chicago Mercantile Exchange ......................................................................... 379,377 44.66 421,246 379,377 ICE Futures U.S .............................................................................................. 191,253 9.22 143,431 143,431 Minneapolis Grain Exchange ........................................................................... 69,981 0.05 35,250 35,250 NADEX North American .................................................................................. 27,579 0.14 14,516 14,516 New York Mercantile Exchange ...................................................................... 195,722 14.49 172,990 172,990 One Chicago .................................................................................................... 10,589 0.29 6,798 6,798 NASDAQ .......................................................................................................... ........................ 0.21 1,089 ........................ ERIS Exchange ............................................................................................... ........................ 0.01 68 ........................ NY LIFFE ......................................................................................................... ........................ ........................ ........................ ........................ ELX Futures ..................................................................................................... ........................ ........................ ........................ ........................ KCBT ............................................................................................................... ........................ ........................ ........................ ........................ Subtotal ..................................................................................................... 1,036,981 100 1,036,945 857,423 National Futures Association ........................................................................... 325,281 ........................ ........................ 325,281 Total ................................................................................................... 1,362,262 ........................ ........................ 1,182,704 III. Payment Method States as miscellaneous receipts. See 7 COMMODITY FUTURES TRADING The Debt Collection Improvement Act U.S.C. 16a. COMMISSION (‘‘DCIA’’) requires deposits of fees owed Issued in Washington, DC, on June 19, to the government by electronic transfer Agency Information Collection 2018, by the Commission. of funds. See 31 U.S.C. 3720. For Activities: Notice of Intent To Renew Christopher Kirkpatrick, Collection 3038–0021, Regulations information about electronic payments, Secretary of the Commission. Governing Bankruptcies of Commodity please contact Jennifer Fleming at (202) amozie on DSK3GDR082PROD with NOTICES1 418–5034 or jfleming@cftc.gov, or see [FR Doc. 2018–13511 Filed 6–22–18; 8:45 am] Brokers the CFTC website at www.cftc.gov, BILLING CODE 6351–01–P AGENCY: Commodity Futures Trading specifically, www.cftc.gov/cftc/ Commission. cftcelectronicpayments.htm. ACTION: Notice. Fees collected from each self- regulatory organization shall be SUMMARY: The Commodity Futures deposited in the Treasury of the United Trading Commission (CFTC or VerDate Sep<11>2014 17:58 Jun 22, 2018 Jkt 244001 PO 00000 Frm 00020 Fmt 4703 Sfmt 4703 E:\FR\FM\25JNN1.SGM 25JNN1


Document Created: 2018-06-23 02:29:39
Document Modified: 2018-06-23 02:29:39
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
ActionNotice of 2017 schedule of fees.
DatesEach self-regulatory organization is required to remit electronically the applicable fee on or before August 24, 2018.
ContactMary Jean Buhler, Chief Financial Officer, Commodity Futures Trading Commission; (202) 418-5089; Three Lafayette Centre, 1155 21st Street NW, Washington, DC 20581. For information on electronic payment, contact Jennifer Fleming; (202) 418- 5034; Three Lafayette Centre, 1155 21st Street NW, Washington, DC 20581.
FR Citation83 FR 29546 
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