Posted June 30, 2014
On
Tuesday, the Consumer Protection End User Relief Act (H.R.
4413) was passed, authorizing the Commission Futures Trading Commission
(CFTC) through 2018, according to a Delta Farm Press article by David Bennett
available here.
Farm Futures also published an article available here,
the Wall Street Journal here,
and Reuters here.
Forty-six
Democrats and 219 Republicans passed the legislation. The Senate has yet to
introduce companion legislation.
"I am pleased to have the support of my colleagues on a
bill that touches nearly every part of the economy,” said Oklahoma Rep. Frank
Lucas, chairman of the House Agriculture Committee. “This legislation
reauthorizes the Commodity Futures Trading Commission through 2018 and ensures
that the agency is working in the most efficient and effective way. It also
cements key protections into law for futures customers, such as our nation’s
farmers and ranchers, and reduces the regulatory load on end-users who
represent 94 percent of American job creators.”
The White House opposes the bill stating that it “undermines
the efficient functioning” of the CFTC and “offers no solution to address the
persistent inadequacy of the agency’s funding,” which is supported by Senate
Agriculture Committee Debbie Stabenow, D-Mich., according to Farm
Futures.
"It is disappointing that the bill provides no additional
funding mechanism and adds new layers of administrative burdens, hindering the
agency's ability to do its job and effectively regulate these markets,"
said Stabenow.
The bill reauthorizes the agency’s mandate to reverse the
CFTC’s strict rules on the U.S. businesses’ swaps with counterparties abroad,
which would require a new regime with the Securities and Exchange Commission,
according to Reuters.
Farmers and other small market players, who use futures to
protect revenue from their crops against unpredicted market prices, would be
exempted from some of the CFTC’s expensive new rules.
The CFTC
would have to conduct a high-frequency trading study, ease restrictions against
hedge-fund marketing to mirror looser Securities and Exchange Commission rules,
and boost customer funds protection at futures firms. A review of the metals
warehousing industry over the concerns of possible price manipulation would
also have to be conducted, according to the Wall
Street Journal.
For more information on commodity programs, please visit the
National Agricultural Law Center’s website here.
