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CFTC's Plan To End Position Limits Saga Faces Big Test

February 5, 2020, Law360

Anne Termine is quoted in Law360 regarding the U.S. Commodity Futures Trading Commission’s effort to impose position limits meant to curb speculators’ ability to distort prices. The new plan allows users to seek exemptions not set forth in the rule proposal by applying directly to their relevant exchanges. The CFTC would have 10 days to review that decision or two days under narrow cases considered more urgent, differing from the current 30 day request. Ms. Termine says, “The streamlined process it provides to apply for additional bona fide hedge exemptions can be construed as the agency ceding too much authority to the exchanges.” She adds, “it will be nearly impossible to balance all stakeholder interests” but noted that Chairman Heath Tarbert is committed to getting the rule finalized and providing certainty to the market. “The most important takeaway for the industry is to take advantage of the comment period and voice their concerns with the rule, as well as provide support for the portions of the rule that are liked. This kind of fulsome feedback is the only way the commission can attempt to draft and pass a final rule that may have lasting power.”

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