CFTC Reauthorization Act of 2019

IB Union Calendar No. 254 116TH CONGRESS 1ST SESSION H. R. 4895 [Report No. 116–313] To reauthorize the Commodity Futures Trading Commission. IN THE HOUSE OF REPRESENTATIVES OCTOBER 29, 2019 Mr. PETERSON (for himself, Mr. CONAWAY, Mr. DAVID SCOTT of Georgia, and Mr. AUSTIN SCOTT of Georgia) introduced the following bill; which was referred to the Committee on Agriculture NOVEMBER 26, 2019 Additional sponsors: Ms. FUDGE, Mr. THOMPSON of Pennsylvania, Mr. VELA, Mr. CRAWFORD, Ms. SPANBERGER, Mr. RODNEY DAVIS of Illinois, Mr. COX of California, Mr. ALLEN, Ms. CRAIG, Mr. BOST, Mr. VAN DREW, Mr. ROUZER, Mr. HARDER of California, Mr. COMER, Mr. SEAN PATRICK MALONEY of New York, Mr. MARSHALL, Mr. LAWSON of Florida, Mr. DUNN, Mr. PANETTA, Mr. JOHNSON of South Dakota, Mrs. KIRK- PATRICK, Mr. BAIRD, Mrs. AXNE, Mr. JOHNSON of Georgia, and Mrs. HAYES NOVEMBER 26, 2019 Reported with an amendment, committed to the Committee of the Whole House on the State of the Union, and ordered to be printed [Strike out all after the enacting clause and insert the part printed in italic] [For text of introduced bill, see copy of bill as introduced on October 29, 2019] VerDate Sep 11 2014 21:25 Nov 26, 2019 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6652 E:\BILLS\H4895.RH H4895 pamtmann on DSKBC07HB2PROD with BILLS 2 •HR 4895 RH A BILL To reauthorize the Commodity Futures Trading Commission. VerDate Sep 11 2014 21:25 Nov 26, 2019 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6652 E:\BILLS\H4895.RH H4895 pamtmann on DSKBC07HB2PROD with BILLS 3 •HR 4895 RH Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘CFTC Reauthorization 4 Act of 2019’’. 5 SEC. 2. TABLE OF CONTENTS. 6 The table of contents of this Act is as follows: 7 Sec. 1. Short title. Sec. 2. Table of contents. TITLE I—POLICY AMENDMENTS Sec. 101. Foreign futures authority. Sec. 102. Honors program. Sec. 103. Advisory committee changes. Sec. 104. Enhancement of Office of Minority and Women Inclusion at the Com- mission; internship program. Sec. 105. Detailing and resource-sharing. Sec. 106. Office of the Chief Economist. Sec. 107. Equal consideration for holding companies. Sec. 108. Exemption of qualified charitable organizations from regulation as com- modity pool operators. Sec. 109. Digital commodity. Sec. 110. System safeguards. Sec. 111. Administration of swap execution facilities. Sec. 112. Applicability of prohibitions on fraud and manipulation to activities outside the United States. Sec. 113. Privilege retention. Sec. 114. Proprietary information. Sec. 115. Authority to provide food and incidental assistance to foreign officials hosted by the Commission. Sec. 116. Extension of operations. Sec. 117. Aiding and abetting. Sec. 118. Modernization of authority of the Commission to conduct research, de- velopment, demonstration, and information programs. Sec. 119. Protecting customer property during commodity broker bankruptcy. Sec. 120. Elimination of the double-sided confirmation requirement for swap data repositories. Sec. 121. Whistleblower protections for internal disclosures. Sec. 122. Updating standards for natural persons to meet requirements for quali- fied eligible persons. Sec. 123. Government Accountability Office study on aluminum markets. Sec. 124. Response to foreign regulatory authority. Sec. 125. Affiliate conditions. TITLE II—TECHNICAL CORRECTIONS Sec. 201. Correction of references. VerDate Sep 11 2014 21:25 Nov 26, 2019 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6213 E:\BILLS\H4895.RH H4895 pamtmann on DSKBC07HB2PROD with BILLS 4 •HR 4895 RH Sec. 202. Elimination of obsolete references to dealer options. Sec. 203. Updated trade data publication requirement. Sec. 204. Flexibility for all registered entities. Sec. 205. Elimination of obsolete references to electronic trading facilities. Sec. 206. Elimination of obsolete reference to alternative swap execution facilities. Sec. 207. Clarification of Commission authority over swaps trading. Sec. 208. Elimination of obsolete reference to the Commodity Exchange Commis- sion. Sec. 209. Elimination of obsolete references to derivative transaction execution fa- cilities. Sec. 210. Elimination of obsolete references to exempt boards of trade. Sec. 211. Elimination of completed reports. Sec. 212. Miscellaneous corrections. Sec. 213. Technical amendments to section 14(e). Sec. 214. Technical clarifications for retail foreign currency. Sec. 215. Miscellaneous swap technical corrections. TITLE I—POLICY AMENDMENTS 1 SEC. 101. FOREIGN FUTURES AUTHORITY. 2 (a) IN GENERAL.—Section 1a(26) of the Commodity 3 Exchange Act (7 U.S.C. 1a(26)) is amended to read as fol- 4 lows: 5 ‘‘(26) FOREIGN FUTURES AUTHORITY.—The term 6 ‘foreign futures authority’ means any foreign govern- 7 ment, or any law enforcement authority, department, 8 central bank, ministry, agency, governmental body, or 9 regulatory organization empowered by a foreign gov- 10 ernment to administer, enforce, or prosecute a law, 11 rule, or regulation relating to matters involving fu- 12 tures, options, swaps, or commodities, or any such 13 authority, department, or agency of a political sub- 14 division of a foreign government empowered to ad- 15 minister, enforce, or prosecute a law, rule, or regula- 16 tion as it relates to such matters.’’. 17 VerDate Sep 11 2014 21:25 Nov 26, 2019 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6203 E:\BILLS\H4895.RH H4895 pamtmann on DSKBC07HB2PROD with BILLS 5 •HR 4895 RH (b) CONFORMING AMENDMENT.—Section 12(f) of such 1 Act (7 U.S.C. 16(f)) is amended— 2 (1) in paragraph (1)— 3 (A) by striking ‘‘futures or options’’ and in- 4 serting ‘‘futures, options, swaps, or commod- 5 ities’’; and 6 (B) by striking ‘‘administers or enforces’’ 7 and inserting ‘‘administers, enforces, or pros- 8 ecutes’’; and 9 (2) in paragraph (2)(A), by striking ‘‘in futures 10 and options’’ and inserting ‘‘in futures, options, 11 swaps, or commodities’’. 12 SEC. 102. HONORS PROGRAM. 13 (a) IN GENERAL.—Section 2(a)(7) of the Commodity 14 Exchange Act (7 U.S.C. 2(a)(7)) is amended by adding at 15 the end the following: 16 ‘‘(D) HONORS PROGRAM.—The Commission 17 may establish the Honors Program under its ap- 18 pointment and compensation authorities.’’. 19 (b) CONFORMING AMENDMENT.—Section 12(b)(1) of 20 such Act (7 U.S.C. 16(b)(1)) is amended by adding at the 21 end the following: ‘‘To clarify the Commission’s authority 22 to establish the Honors Program under section 2(a)(7)(D), 23 the Commission may coordinate with the Office of Personnel 24 Management, as needed.’’. 25 VerDate Sep 11 2014 21:25 Nov 26, 2019 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6203 E:\BILLS\H4895.RH H4895 pamtmann on DSKBC07HB2PROD with BILLS 6 •HR 4895 RH SEC. 103. ADVISORY COMMITTEE CHANGES. 1 (a) IN GENERAL.—Section 2(a)(15) of the Commodity 2 Exchange Act (7 U.S.C. 2(a)(15)) is amended to read as 3 follows: 4 ‘‘(15) ADVISORY COMMITTEES.— 5 ‘‘(A) ESTABLISHMENT.— 6 ‘‘(i) IN GENERAL.—The Commission 7 shall establish advisory committees to serve 8 as vehicles for discussion and communica- 9 tion on matters related to the regulatory ac- 10 tivities of the Commission. 11 ‘‘(ii) MEMBERSHIP.—The Commission 12 shall appoint to an advisory committee such 13 members as the Commission finds appro- 14 priate to promote robust discussion of the 15 subject mater before the advisory committee. 16 In appointing members to an advisory com- 17 mittee, the Commission shall seek to include 18 a wide diversity of opinion and represent a 19 broad cross-section of interests, as applica- 20 ble to the subject matter. 21 ‘‘(B) ACTIVITIES.—The activities of an ad- 22 visory committee shall include the following: 23 ‘‘(i) to hold meetings at such intervals 24 as necessary to carry out the functions of 25 the advisory committee; 26 VerDate Sep 11 2014 21:25 Nov 26, 2019 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6203 E:\BILLS\H4895.RH H4895 pamtmann on DSKBC07HB2PROD with BILLS 7 •HR 4895 RH ‘‘(ii) to submit to the Commission such 1 reports and recommendations to the Com- 2 mission (including minority views, if any) 3 as the advisory committee deems appro- 4 priate; and 5 ‘‘(iii) such activities as the Commis- 6 sion determines is appropriate. 7 ‘‘(C) APPLICABILITY OF THE FEDERAL AD- 8 VISORY COMMITTEE ACT.—An advisory com- 9 mittee established under this paragraph shall be 10 subject to the Federal Advisory Committee Act.’’. 11 (b) EXISTING ADVISORY COMMITTEES.—Notwith- 12 standing section 2(a)(15) of the Commodity Exchange Act, 13 the Commodity Futures Trading Commission may permit 14 an advisory committee that, as of the date of the enactment 15 of this Act, had a charter established by the Commission, 16 or that was established under such section as in effect before 17 such date of enactment, to continue to operate in accordance 18 with the charter or in accordance with such predecessor sec- 19 tion until the sponsor of the advisory committee is changed. 20 After which such advisory committee will become subject to 21 section 2(a)(15) of the Commodity Exchange Act. 22 VerDate Sep 11 2014 21:25 Nov 26, 2019 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6203 E:\BILLS\H4895.RH H4895 pamtmann on DSKBC07HB2PROD with BILLS 8 •HR 4895 RH SEC. 104. ENHANCEMENT OF OFFICE OF MINORITY AND 1 WOMEN INCLUSION AT THE COMMISSION; IN- 2 TERNSHIP PROGRAM. 3 (a) IN GENERAL.—Section 2(a) of the Commodity Ex- 4 change Act (7 U.S.C. 2(a)) is amended by adding at the 5 end the following: 6 ‘‘(16) OFFICE OF MINORITY AND WOMEN INCLU- 7 SION.—Within 1 year after the date of the enactment 8 of this paragraph, the Commission shall comply with 9 section 342 of the Dodd-Frank Wall Street Reform 10 and Consumer Protection Act. 11 ‘‘(17) ANNUAL INTERNSHIP PROGRAM.— 12 ‘‘(A) IN GENERAL.—The Executive Director 13 shall establish a program to place an appro- 14 priate number of students attending qualified in- 15 stitutions in a semester-length internship within 16 the Commission’s divisions and offices. 17 ‘‘(B) FUNDING.—The Commission shall set 18 aside an appropriate percentage of the funds al- 19 located to the office of the Chairman to enable 20 the selected interns identified in subparagraph 21 (A) to afford living expenses, including rent and 22 a per-diem, in the metropolitan areas where the 23 Director identifies internship opportunities. 24 VerDate Sep 11 2014 21:25 Nov 26, 2019 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6203 E:\BILLS\H4895.RH H4895 pamtmann on DSKBC07HB2PROD with BILLS 9 •HR 4895 RH ‘‘(C) QUALIFIED INSTITUTION DEFINED.— 1 In this paragraph, the term ‘qualified institu- 2 tion’ means— 3 ‘‘(i) an 1890 Institution (as defined in 4 section 2 of the Agricultural Research, Ex- 5 tension, and Education Reform Act of 1998 6 (7 U.S.C. 7601)); 7 ‘‘(ii) a 1994 Institution (as defined in 8 section 532 of the Equity in Educational 9 Land-Grant Status Act of 1994 (Public 10 Law 103–382; 7 U.S.C. 301 note)); 11 ‘‘(iii) an eligible institution (as defined 12 in section 1489 of the National Agricultural 13 Research, Extension, and Teaching Policy 14 Act of 1977 (7 U.S.C. 3361)); or 15 ‘‘(iv) a Hispanic-serving institution 16 (as defined in section 1404 of the Food and 17 Agriculture Act of 1977 (7 U.S.C. 3103)).’’. 18 (b) JOINT STANDARDS.—In carrying out section 19 2(a)(16) of the Commodity Exchange Act, the Commodity 20 Futures Trading Commission shall adopt the joint stand- 21 ards established in the Interagency Policy Statement pub- 22 lished in the Federal Register on June 10, 2015 (80 Fed. 23 Reg. 33016), or any successor Policy Statement. 24 VerDate Sep 11 2014 21:25 Nov 26, 2019 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6203 E:\BILLS\H4895.RH H4895 pamtmann on DSKBC07HB2PROD with BILLS 10 •HR 4895 RH SEC. 105. DETAILING AND RESOURCE-SHARING. 1 Section 2(a) of the Commodity Exchange Act (7 U.S.C. 2 2(a)), as amended by section 104 of this Act, is amended 3 by adding at the end the following: 4 ‘‘(18) ASSISTANCE FROM FEDERAL AGENCIES.— 5 ‘‘(A) IN GENERAL.—The Commission may 6 accept any assistance, including services, funds, 7 facilities, and other support services as deter- 8 mined by the Commission, to effectuate the pur- 9 poses and provisions of this Act, from any de- 10 partment or agency of the United States that is 11 authorized under other law to provide the assist- 12 ance. 13 ‘‘(B) DETAIL FLEXIBILITY.—When an em- 14 ployee from another department or agency is de- 15 tailed to the Commission, the employee may be 16 detailed on either a reimbursable or non-reim- 17 bursable basis, and such detail shall be without 18 interruption or loss of civil service status or 19 privilege. 20 ‘‘(19) ASSISTANCE FROM FOREIGN GOVERN- 21 MENTAL ENTITIES.— 22 ‘‘(A) IN GENERAL.—The Commission 23 may— 24 ‘‘(i) accept details of officers or em- 25 ployees of a foreign futures authority or any 26 VerDate Sep 11 2014 21:25 Nov 26, 2019 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6203 E:\BILLS\H4895.RH H4895 pamtmann on DSKBC07HB2PROD with BILLS 11 •HR 4895 RH department or agency of a foreign govern- 1 ment, including a central bank or ministry, 2 on a temporary basis as employees of the 3 Commission pursuant to section 12(b) of 4 this Act, or section 3101 or 3109 of title 5, 5 United States Code; and 6 ‘‘(ii) detail officers or employees of the 7 Commission to work on a temporary basis 8 for an entity described in clause (i). 9 ‘‘(B) RECIPROCITY AND REIMBURSEMENT.— 10 ‘‘(i) RECIPROCITY NOT REQUIRED.— 11 Assistance described in subparagraph (A) 12 need not be provided on a reciprocal basis. 13 ‘‘(ii) REIMBURSEMENT.— 14 ‘‘(I) IN GENERAL.—The Commis- 15 sion may provide and accept assistance 16 described in subparagraph (A) on a re- 17 imbursable or non-reimbursable basis, 18 only in accordance with a written 19 agreement between the Commission 20 and the respective foreign governmental 21 entity. 22 ‘‘(II) FORM.—A reimbursement to 23 or from the Commission may be made 24 in cash or in kind. The Commission 25 VerDate Sep 11 2014 21:25 Nov 26, 2019 Jkt 099200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6203 E:\BILLS\H4895.RH H4895 pamtmann on DSKBC07HB2PROD with BILLS 12 •HR 4895 RH shall credit a reimbursement received 1 from a foreign governmental entity to 2 the appropriate Commission appro- 3 priation, fund, or account. 4 ‘‘(C) STANDARDS OF CONDUCT.—An officer 5 or employee detailed under subparagraph (A)(i) 6 shall be subject to the provisions of law relating 7 to ethics, conflicts of interest, or corruption, and 8 to any other statute governing the standards of 9 conduct for Commission employees that are ap- 10 plicable to the type of appointment. 11 ‘‘(D) LIMITATION.—An officer [Text truncated for display. Full text available on Congress.gov.]