WASHINGTON, DC – Walt Lukken, President and CEO of FIA, testified today at a US House Agriculture Committee subcommittee hearing on reauthorizing the Commodities Futures Trading Commission (CFTC).
Highlights:
- FIA strongly supports reauthorizing the CFTC.
- Since the last reauthorization of the CFTC in 2008:
- Futures and options markets have grown significantly – total trading volume on CFTC-regulated exchanges in the US has nearly doubled from 3.4 billion futures and options contracts in 2008 to 6.6 billion in 2023.
- The markets are safer and more resilient, as demonstrated through the onset of COVID-19 and the Russian invasion of Ukraine.
- The markets have continued to become more global and innovative.
FIA encourages Congress to:
- Monitor and encourage the CFTC to enact a strong conflicts of interest rule to address concerns when exchanges and clearinghouses embed an FCM within their legal structure.
- Monitor the impact of the Basel III endgame and the Federal Reserve’s proposal to significantly adjust the capital levels required by global systemically important bank holding companies, as these rules will harm the CFTC-regulated derivatives markets and the end-users that rely on them.
- Monitor implementation of the Treasury clearing mandates and encourage continued collaboration between the CFTC and the SEC to ensure any rules do not conflict with CFTC regulations.
Recommendations for CFTC Reauthorization Legislation:
- Resolve the legal uncertainty in FCM bankruptcies related to the definition of "customer property."
- Expand access to educational resources for small and mid-size farmers.
- Improve the research and development of capabilities of the CFTC.
