CFTC Staff Letter 05-08: No-Action Relief for TAIFEX Futures on TE and TF Indices

U.S. COMMODITY FUTURES TRADING COMMISSION
Three Lafayette Centre
1155 21st Street, NW, Washington, DC 20581
Telephone: (202) 418-5120
Facsimile: (202) 418-5524
Office of General Counsel

CFTC letter No. 05-08
May 16, 2005
No-Action
Office of General Counsel
Michael S. Sackheim, Esq.
Sidley Austin Brown & Wood, LLP
787 Seventh Avenue
New York, NY 10019
Re: Requests for No-Action Relief in Connection with the Offer and Sale in the United States of Futures Contracts Based on the Taiwan Stock Exchange Electronic Sector Index and the Taiwan Stock Exchange Finance Sector Index Traded on the Taiwan Futures Exchange Dear Mr. Sackheim:
This is in response to letters, attachments, facsimiles and electronic mail dated from January 3, 2005 to March 4, 2005, requesting on behalf of your client, the Taiwan Futures Exchange (“TAIFEX”), that the Office of General Counsel (“Office”) of the Commodity Futures Trading Commission (“Commission” or "CFTC") issue a “no-action” letter concerning the offer and sale in the United States (“US”) of TAIFEX’s futures contracts based on, respectively, the Taiwan Stock Exchange Electronic Sector Index (“TE”) and the Taiwan Stock Exchange Finance Sector Index (“TF”) (collectively, “Indices”). We understand the facts to be as follows. TAIFEX is a futures exchange in Taiwan founded in 1997 pursuant to the joint efforts of the Taiwanese government and the private sector.1 Originally named the Taiwan International Mercantile Exchange, the exchange’s name was changed to TAIFEX in 1999. TAIFEX was granted a corporate license, and its Board of Directors was selected as the highest executive body of the exchange. The principal regulatory authority in Taiwan having oversight over TAIFEX 1 See letter from Michael S. Sackheim, Sidley Austin Brown & Wood, LLP, to Patrick J. McCarty, General Counsel, CFTC, dated January 3, 2005, at 2 and letter from Michael S. Sackheim, Sidley Austin Brown & Wood, LLP, to Patrick J. McCarty, General Counsel, CFTC, dated January 12, 2005, at 2. Commission staff recently issued no￾action relief to TAIFEX with regard to its futures contracts on the Taiwan Stock Exchange Capitalization Weighted Stock Index. See CFTC Staff Letter No. 04-16 [2003-2004 Transfer Binder] Comm. Fut. L. Rep. (CCH) ¶ 29,781 (June 2, 2004).