[Federal Register Volume 78, Number 166 (Tuesday, August 27, 2013)]
[Notices]
[Pages 52907-52909]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-20772]
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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 FY 2013 Schedule of Fees.
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SUMMARY: The 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, a
[[Page 52908]]
registered futures association, and the designated contract markets.
The calculation of the fee amounts charged for FY 2013 by this notice
is based upon an average of actual program costs incurred during FY
2010, 2011, and 2012.
DATES: Effective date: Each SRO is required to remit electronically the
fee applicable to it on or before October 28, 2013.
FOR FURTHER INFORMATION CONTACT: Mark Carney, Chief Financial Officer,
Commodity Futures Trading Commission, (202) 418-5477, 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\ All costs are accounted for by the
Commission's Budget Program Activity Codes (BPAC) system, formerly the
Management Accounting Structure Codes (MASC) system, which records each
employee's time for each pay period. 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, then charges the lower of the two.\3\
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\1\ NFA 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, app. 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 consist generally 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): 153 percent for fiscal
year 2010, 145 percent for fiscal year 2011, and 161 percent for fiscal
year 2012.
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. This table summarizes the data used in the
calculations of the resulting fee for each entity:
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Actual total costs 3-year
--------------------------------------- average 3-year % of Volume FY 2013
actual volume adjusted assessed
FY 2010 FY 2011 FY 2012 costs costs fee
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CBOE Futures................................................ $ $98,556 29,278 $42,611 0.34 $23,914 $23,914
Chicago Board of Trade...................................... 87,953 5,260 238,392 110,535 29.25 280,868 110,535
Chicago Mercantile Exchange................................. 882,542 422,837 757,347 687,575 50.14 730,502 687,575
ELX Futures................................................. ........... ........... 34,593 11,531 0.341 8,397 8,397
ICE Futures U.S............................................. 94,043 17,624 221,813 111,160 3.20 80,237 80,237
Kansas City Board of Trade.................................. 227,296 30,976 34,335 97,536 0.18 50,133 50,133
Minneapolis Grain Exchange.................................. ........... 88,790 60,897 49,896 0.05 25,321 25,321
NADEX North American........................................ ........... ........... 11,293 3,764 0.000 1,882 1,882
New York Mercantile Exchange................................ 596,767 136,565 7,411 246,915 15.93 246,340 246,340
New York LIFFE.............................................. ........... 416,069 71,317 162,462 0.42 84,495 84,495
One Chicago................................................. ........... ........... 55,755 18,585 0.141 10,382 10,382
Subtotal................................................ 1,888,601 1,216,678 1,522,431 1,542,570 100 1,542,470 1,329,210
National Futures Association................................ 1,206,393 416,615 487,328 703,445 ............ ........... 703,445
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[[Page 52909]]
Total............................................... 3,094,994 1,633,293 2,009,759 2,246,015 ............ ........... 2,032,655
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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 equal 110,535.
b. The alternative computation is: (.5) (110,535) + (.5) (.292)
(1,542,570) = 280,868.
c. The fee is the lesser of a or b; in this case 110,535.
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 2010 through 2012 was 708,424 (one-third of 2,125,273). The fee
to be paid by the NFA for the current fiscal year is 708,424.
II. Schedule of Fees
Therefore, fees for the Commission's review of the rule enforcement
programs at the registered futures associations and DCMs regulated by
the Commission are as follows:
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2013 fee
lesser of
actual or
calculated
fee
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CBOE Futures............................................... $23,914
Chicago Board of Trade..................................... 110,535
Chicago Mercantile Exchange................................ 687,575
ELX Futures................................................ 8,397
ICE Futures U.S............................................ 80,237
Kansas City Board of Trade................................. 50,133
Minneapolis Grain Exchange................................. 25,321
NADEX North American....................................... 1,882
New York Mercantile Exchange............................... 246,340
New York LIFFE............................................. 84,495
One Chicago................................................ 10,382
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Subtotal............................................... 1,329,210
National Futures Association............................... 703,445
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Total.............................................. 2,032,655
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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 Web site at www.cftc.gov, specifically, www.cftc.gov/cftc/cftcelectronicpayments.htm.
Authority: 7 U.S.C. 16a.
Issued in Washington, DC, on August 21, 2013, by the Commission.
Christopher J. Kirkpatrick,
Deputy Secretary of the Commission.
[FR Doc. 2013-20772 Filed 8-26-13; 8:45 am]
BILLING CODE 6351-01-P