THE UNITED STATES CFTC WARNS THE FORECAST MARKET: TRADERS ' INCENTIVE SCHEMES CAN FUEL FALSE TRANSACTIONS AND MARKET MANIPULATION

On 13 August, the United States Commodity Futures Trading Commission (CFTC) Market Supervisory Authority issued today a regulatory reminder to the designated contracting market (DCM) to fulfil its regulatory obligations when submitting self-certification for a business, liquidity, transaction or incentive scheme, in accordance with articles 40.5 and 40.6 of the CTC. This regulatory advice was filed in response to the recent increase in the number of incentive scheme rules submitted under article 40.6 (a) of the CFTC, particularly in relation to incident contract products. CFTC indicated that some of these files had procedural or substantive deficiencies. These deficiencies may prevent staff from assessing whether DCM has given adequate notice of the terms of the plan and whether the plan ' s compliance with the core principles and other regulatory requirements of the Commission has been fully assessed. The guidance identifies the procedural and substantive requirements of staff for submissions under articles 40.5 and 40.6 of the CFTC, including initial submission of incentive plans, revision or change of plans, and submission procedures。