CFTC Staff Letter 00-10: No-Action Position for University Trading Club

00-10
CFTC Letter No. 00-10
January 6, 2000
No-Action
Division of Trading & Markets
Re: Section 4m(1) -- Request for No-Action Position from CPO Registration to Permit University to Offer Seminar Course that Operates as a Student Trading Club Dear :
This is in response to your electronic mail message dated February 15, 1999 to the Commodity Futures Trading Commission (“Commission”), as supplemented by letter dated December 9, 1999, facsimile transmission dated March 30, 1999, electronic mail messages dated June 8, 1999, August 5, 1999, August 17, 1999 and January 3, 2000 and telephone conversations with staff of the Division of Trading and Markets (“Division”). By your correspondence, you request that the Division not recommend that the Commission commence any enforcement action against the “University’s” cooperative extension service (“CES”), for failure to register as a commodity pool operator (“CPO”) under Section 4m(1) of the Commodity Exchange Act (“Act”),1 if the University offers, as
part of its curriculum, a course that will allow University students to trade commodity
interests through participation in a trading club (the “Trading Club”). Based upon your representations, we understand the facts to be as follows. You are an Assistant Professor of Farm Management with the “Q” of the University’s College of Agriculture, Food and Natural Resources, and you have a research appointment through the University’s CES. You also are an employee of the “R” of the “T”, which operates in partnership with the University’s CES. Previously, while working as a graduate teaching assistant at “U”, you taught a seminar course that provided the students enrolled therein the opportunity to participate in a Trading Club. The “U” seminar course was operated under the direction of “A” by “U’s” CES pursuant to a CPO registration no-action position issued by the Division to “U” and its agents and employees in 1987.2 The University proposes to offer a similar seminar course (“Course”) to its third- and fourth-year University students who have completed a specific undergraduate course sequence in marketing. The Course will be offered continually and on an annual basis each Fall semester. It will be made available through the University Line Schedule, the
schedule of class and seminar listings for the subsequent semester. It will be offered on an
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