CFTC Staff Letter 03-27: EDX London Exchange Successor-in-Interest to OM London Exchange Limited

CFTC Letter 03-27
CFTC letter No.03-27
June 18, 2003
No-Action
Office of General Counsel
Philip McBride Johnson, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
1440 New York Avenue, N.W.
Washington, D.C. 20005-2111
Re: EDX London Exchange’s Request for Recognition as Successor-in-Interest to OM London Exchange Limited under the 1996 No-Action Letter Regarding the Offer and Sale of Futures Contracts on the OMX Index in the United States Dear Mr. Johnson:
This is in response to your letters, attachments and electronic mail dated from March 21, 2003 to May 29, 2003, in which you request on behalf of the EDX London Exchange (“EDX”), that the Office of General Counsel (“Office”) of the United States Commodity Futures Trading Commission (“Commission” or “CFTC”) recognize EDX as successor-in-interest to the relief granted in the July 23, 1996 no-action letter issued to OM London Exchange Limited (“OML”), permitting the offer and sale of futures contracts on the OMX Index in the United States (“U.S.”).[1] We understand the facts to be as follows. The futures contracts on the OMX Index that were the subject of the July 23, 1996 no-action letter, which were traded on OML, will now be traded instead on EDX, a joint venture corporation recently formed by OM AG, the parent organization of OML, and the London Stock Exchange, with holdings of 24% and 76%, respectively.[2] Like OML, EDX will be a Recognized Investment Exchange (“RIE”) in the United Kingdom (“U.K.”) and will otherwise comply with all applicable regulatory requirements under U.K. law;[3] its operations will occur under EDX trading rules that are substantially identical to OML’s trading rules; the electronic trading platform and clearing technology used by EDX will continue to be OM CLICK and OM SECUR; the OMX Index itself will remain the same (subject, as in the past, to routine adjustments); and the transactions in OMX futures contracts on EDX will continue to be cleared by OML. The Commodity Exchange Act (“CEA”),[4] as amended by the Commodity Futures Modernization Act of 2000 (“CFMA”),[5] provides that the offer or sale in the U.S. of futures contracts based on a group or index of securities, including those contracts traded on or subject to the rules of a foreign board of trade, is subject to the Commission's exclusive jurisdiction,[6] with the exception of security futures products, file:///S|/Website%20Management/LegacyDataCopyasof2010-04-21/tm/letters/03letters/tm03-27.htm (1 of 5) [5/6/2010 5:38:14 PM]