Commodity Futures Trading Commission August 28, 2012 – Federal Register Recent Federal Regulation Documents

The Commodity Futures Trading Commission (``CFTC'' or ``Commission'') is requesting comment on a proposed exemption (the ``Proposed Exemption'') issued in response to a consolidated petition (``Petition'') \1\ from certain regional transmission organizations (``RTOs'') and independent system operators (``ISOs'') (collectively, ``Petitioners'') to exempt specified transactions from the provisions of the Commodity Exchange Act (``CEA'' or ``Act'') \2\ and Commission regulations. The Proposed Exemption would exempt the contracts, agreements and transactions for the purchase or sale of the limited electricity-related products that are specifically described within the proposed order from the provisions of the CEA and Commission regulations, with the exception of sections 2(a)(1)(B), 4b, 4c(b), 4o, 4s(h)(1)(A), 4s(h)(4)(A), 6(c), 6(d), 6(e), 6c, 6d, 8, 9 and 13 of the Act and any implementing regulations promulgated thereunder including, but not limited to Commission regulations 23.410(a) and (b), 32.4 and part 180. To be eligible for the Proposed Exemption, the contract, agreement or transaction would be required to be offered or entered into in a market administered by a Petitioner pursuant to that Petitioner's tariff or protocol for the purposes of allocating such Petitioner's physical resources; the relevant tariff or protocol would be required to have been approved or permitted to have taken effect by either the Federal Energy Commission (``FERC'') or the Public Utility Commission of Texas (``PUCT''), as applicable; and the contract, agreement or transaction would be required to be entered into by persons who are ``appropriate persons,'' as defined in section 4(c)(3)(A) through (J) of the Act \3\ or ``eligible contract participants,'' as defined in section 1a(18) of the Act and Commission regulations.\4\ The exemption as proposed also would extend to any person or class of persons offering, entering into, rendering advice or rendering other services with respect to such transactions. Finally, the exemption would be subject to other conditions set forth therein. Authority for issuing the exemption is found in section 4(c)(6) of the Act.\5\