Abstract:
US Commodity Futures Trading Commission enhances the efficiency and competitiveness of the commodity futures markets of USA. It also protects the participants of commodity futures markets against any type of fraud and illegal trade practices.US Commodity Futures Trading Commission(CFTC) was established long back in 1975. US Congress formed this independent agency in order to regulate the commodity futures market and commodity option market of USA.
History of Establishment of CFTC
Trading in the Commodity Futures Market started in USA from very early years. At that time, futures contracts used to be traded mostly for agricultural commodities. Then, gradually, commodity futures trading expanded beyond agricultural commodities. People of USA, started futures contract trading for US government securities, foreign currencies, foreign government securities, US Stock Indices and Foreign Stock Indices. So, US Government felt the need of a regulatory authority and US Commodity Futures Trading Commission was set up by US Congress.Evolution of CFTC
From its' time of establishment, the commission has evolved significantly. The mandates which are followed by this independent agency, were renewed many times. The most significant amendment of rules came in the year 2002. At the end of the year 2002, a special act, named "Commodity Futures Modernization Act of 2000" was passed by the US Congress. This act led to generation of a "Joint Regulatory Regime" for single stock futures contracts. This Joint Regulatory Regime was developed jointly by Commodity Futures Trading Commission and the Securities and Exchange Commission.Role and Functions of CFTC
- US Commodity Futures Trading Commission ensures the efficiency and enhances the competitiveness of the commodity futures markets.
- The commission works towards the integration of the commodity futures markets of USA.
- The Commodity Futures Trading Commission protects the participants of the commodity futures markets against fraud, illegal trading practices and all types of manipulation.
- This independent agency ensures the financial integrity of the overall clearing process.
- Division of Market Oversight
- Division of Enforcement
- Division of Clearing and Intermediary Oversight
- Office of the Executive Director
- Office of the General Counsel
- Office of Chief Economist
