CFTC proposed a 20,000-contract volume threshold in a supplemental Regulation AT notice published November 25, 2016. The figure concerned the scope of its proposed automated trading person definition. It was not a maximum number of contracts a firm could trade. This account occupies the November 26 weekend slot, rather than reporting a Saturday announcement. [2016-27250]
The calculation would use average daily trading over six months, counting a firm’s own accounts, customer accounts, or both, across products on designated contract markets. A single busy day therefore would not describe the proposed test. Equally, falling outside this element of the definition would not establish a general exemption from all trading safeguards. [2016-27250][2015-30533]
The December 17, 2015 proposal supplies the broader purpose: risk controls and transparency for automated order placement and execution in derivatives markets. The supplement did not withdraw that package. It proposed moving from three control levels to two, retaining exchange controls while allowing an automated trading person to delegate pre-trade controls to a futures commission merchant. [2016-27250][2015-30533]
January 24, 2017 was the deadline for comments, not an effective date. The two notices document successive stages of one agency process; they are not independent evaluations of safety. Reading them together distinguishes the proposed numerical boundary from the proposed operating arrangements. Neither notice, at this point in the chronology, establishes adoption of the new architecture or a measured improvement in market performance. [2016-27250][2015-30533]
Source documents
- Regulation Automated Tradinghttps://www.govinfo.gov/content/pkg/FR-2016-11-25/html/2016-27250.htm
- Regulation Automated Tradinghttps://www.govinfo.gov/content/pkg/FR-2015-12-17/html/2015-30533.htm