Overview
Wash Trades
- Wash Trades - Definition of a Wash Trade
- Wash Trades – Responsibility and Implications
- Wash Trades – Automated Trading Systems
- Wash Trades - Freshening
EFRP
- EFRP - What is an EFRP?
- EFRP - Parties to an EFRP
- EFRP - Pricing and the Related Position for EFRPs
- EFRP - Reporting and Recordkeeping
- EFRP - Prohibited Transitory EFRPs
Block Trades
- Block Trades - What is a Block Trade?
- Block Trades – Participant Eligibility
- Block Trades – Eligible Products, Times and Prices
- Block Trades – Reporting and Recordkeeping
- Block Trades – Pre-Hedging
- Block Trades – TAS, TAM and BTIC
Disruptive Practices Prohibited
- Disruptive Practices Prohibited - General Information
- Disruptive Practices Prohibited - Factors Market Regulation Considers
- Disruptive Practices Prohibited - Spoofing
- Disruptive Practices Prohibited - Flipping
- Disruptive Practices Prohibited - Additional Examples
- Disruptive Practices Prohibited - Frequently Asked Questions
CME Globex Tag 50 ID Requirements
- CME Globex Tag 50 ID Requirements – General Rule
- CME Globex Tag 50 ID Requirements - Registration and Requirements
- CME Globex Tag 50 ID Requirements - Individual and Team Tag 50s
Pre-Execution Communications
Rule 524 - TAS, TAM, BTIC and TACO
Enforcement Process
CME Group Rules and Regulation Overview
Founded in 1974, the U.S. Commodity Futures Trading Commission (CFTC) is the primary regulator of the U.S. futures and options on futures markets.
CME, CBOT, NYMEX and COMEX are separate CFTC-registered and regulated Designated Contract Markets (DCMs) with self-regulatory responsibilities. To provide a common regulatory framework for market users, the rulebooks have been substantially harmonized with a few significant differences, such as membership requirements and product specifications.
Rulebooks
Each rulebook includes access requirements, terms and conditions of any contracts to be traded, and rules prohibiting abusive trade practices. The rulebooks can be found in the Market Regulation section of cmegroup.com
Traders participating on any CME Group Exchange must be aware of and abide by all Exchange rules. Market Regulation is charged with, but not limited to, regulating Chapters four and five, along with certain parts of Chapters seven and eight.
Those chapters are:
- Chapter Four: Enforcement of Rules
- Chapter Five: Trading Practices
- Chapter Seven: Delivery Facilities and Procedures
- Chapter Eight: Clearing House and Performance Bonds
The remainder of the chapters cover the terms and conditions of each product in the specific Designated Contract Market as well as membership and committees.
Additional lessons detailing specifics of trading practices covering block trades, wash trades, prohibited and disruptive practices, can be found in other lessons in this course.
Market Regulation Advisory Notices
In addition to rules, CME Group Market Regulation periodically sends Market Regulation Advisory Notices (MRAN) to inform the marketplace of:
- Rule amendments
- New Rules
- Regulatory guidance
- Reminders of current rules
MRANs are used to advise the marketplace on how to stay in compliance with the rules and are distributed by the Market Regulation department. MRANs have the same force and effect as a rule. Market participants can and should subscribe to receive these.
Special Executive Reports
Market Regulation Special Executive Reports (SERs) provide the marketplace with information regarding:
- Upcoming rule changes
- Reminders
SERs can be sent by multiple departments throughout CME Group. However, Market Regulation will send out SERs specifically to inform the marketplace of rule changes and other announcements.
Market Surveillance Notices
Additionally, market participants can find information regarding position limits and large trader reporting requirements by subscribing to receive Market Surveillance notices.
Market participants can and should subscribe to receive MRANs, SERs and Market Surveillance Notices. This can be done through the Market Regulation page of cmegroup.com.
Enforcement of Rules
As a Designated Contract Market, CME, CBOT, NYMEX and COMEX, must employ an enforcement team that works to resolve rule violations through each exchange’s disciplinary process. A thorough description of the enforcement process is available in another lesson in this course.
The mission of the Market Regulation department is to protect and enhance the integrity of CME Group markets by efficiently providing superior quality regulation and regulatory services to all constituents and mitigating regulatory risk through proactive and dynamic regulation.
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