§ 7a-1. Derivatives clearing organizations
(a)
Registration requirement
It shall be unlawful for a derivatives clearing organization, unless registered with the Commission, directly or indirectly to make use of the mails or any means or instrumentality of interstate commerce to perform the functions of a derivatives clearing organization described in section
1a
(9) of this title with respect to a contract of sale of a commodity for future delivery (or option on such a contract) or option on a commodity, in each case unless the contract or option—
(b)
Voluntary registration
A derivatives clearing organization that clears agreements, contracts, or transactions excluded from this chapter by section
2
(c),
2
(d),
2
(f), or
2
(g) of this title or sections
27 to
27f of this title, or exempted under section
2
(h) or
6
(c) of this title, or other over-the-counter derivative instruments (as defined in the Federal Deposit Insurance Corporation Improvement Act of 1991) may register with the Commission as a derivatives clearing organization.
(c)
Registration of derivatives clearing organizations
(1)
Application
A person desiring to register as a derivatives clearing organization shall submit to the Commission an application in such form and containing such information as the Commission may require for the purpose of making the determinations required for approval under paragraph (2).
(2)
Core principles
(A)
In general
To be registered and to maintain registration as a derivatives clearing organization, an applicant shall demonstrate to the Commission that the applicant complies with the core principles specified in this paragraph. The applicant shall have reasonable discretion in establishing the manner in which it complies with the core principles.
(B)
Financial resources
The applicant shall demonstrate that the applicant has adequate financial, operational, and managerial resources to discharge the responsibilities of a derivatives clearing organization.
(C)
Participant and product eligibility
The applicant shall establish—
(D)
Risk management
The applicant shall have the ability to manage the risks associated with discharging the responsibilities of a derivatives clearing organization through the use of appropriate tools and procedures.
(E)
Settlement procedures
The applicant shall have the ability to—
(F)
Treatment of funds
The applicant shall have standards and procedures designed to protect and ensure the safety of member and participant funds.
(G)
Default rules and procedures
The applicant shall have rules and procedures designed to allow for efficient, fair, and safe management of events when members or participants become insolvent or otherwise default on their obligations to the derivatives clearing organization.
(H)
Rule enforcement
The applicant shall—
(I)
System safeguards
The applicant shall demonstrate that the applicant—
(J)
Reporting
The applicant shall provide to the Commission all information necessary for the Commission to conduct the oversight function of the applicant with respect to the activities of the derivatives clearing organization.
(K)
Recordkeeping
The applicant shall maintain records of all activities related to the business of the applicant as a derivatives clearing organization in a form and manner acceptable to the Commission for a period of 5 years.
(L)
Public information
The applicant shall make information concerning the rules and operating procedures governing the clearing and settlement systems (including default procedures) available to market participants.
(M)
Information-sharing
The applicant shall—
(d)
Existing derivatives clearing organizations
A derivatives clearing organization shall be deemed to be registered under this section to the extent that the derivatives clearing organization clears agreements, contracts, or transactions for a board of trade that has been designated by the Commission as a contract market for such agreements, contracts, or transactions before December 21, 2000.
(e)
Appointment of trustee
(1)
In general
If a proceeding under section
7b of this title results in the suspension or revocation of the registration of a derivatives clearing organization, or if a derivatives clearing organization withdraws from registration, the Commission, on notice to the derivatives clearing organization, may apply to the appropriate United States district court where the derivatives clearing organization is located for the appointment of a trustee.
(2)
Assumption of jurisdiction
If the Commission applies for appointment of a trustee under paragraph (1)—
(A)
the court may take exclusive jurisdiction over the derivatives clearing organization and the records and assets of the derivatives clearing organization, wherever located; and
(B)
if the court takes jurisdiction under subparagraph (A), the court shall appoint the Commission, or a person designated by the Commission, as trustee with power to take possession and continue to operate or terminate the operations of the derivatives clearing organization in an orderly manner for the protection of participants, subject to such terms and conditions as the court may prescribe.
(f)
Linking of regulated clearing facilities