CFTC Directs Designated Contract Markets to Eliminate or Justify Domestic Geographic Restrictions

The US Commodity Futures Trading Commission has instructed designated contract markets to review and address domestic geographic restrictions that limit access to their platforms. Exchanges now have 30 days to remove any restrictions that violate impartial access rules or submit an explanation to the regulator detailing why compliance is not feasible.

The directive cites Commission Regulation 38.151(b), which requires DCMs to provide impartial access to members and other persons with trading privileges. It applies equally to intermediaries providing access to these platforms. The CFTC intends the measure to ensure derivatives markets operate under consistent conditions nationwide.

“Derivatives markets must operate on a uniform basis at a national scale to achieve the purposes set out in the Commodity Exchange Act,” said CFTC Chairman Michael S. Selig. “Geographic access restrictions are inconsistent with those purposes and the Act’s impartial access requirements.”

If a DCM cannot comply within the deadline, it must explain its reasons to the Division of Market Oversight (DMO). The Commission will assess the facts and circumstances of individual cases when considering potential regulatory action. This applies to both the exchanges and the intermediaries that serve them.

Basis for the Impartial Access Directive

The CFTC grounded its instructions in the requirements of Commission Regulation 38.151(b). That rule establishes the obligation for designated contract markets to extend impartial access. Selig’s statement frames geographic limits as incompatible with the Commodity Exchange Act’s core purposes and the uniform national scale those purposes demand.

The regulator’s focus remains on domestic restrictions within the United States. No broader international dimensions appear in the directive. The stated goal is consistent operating conditions across the country for derivatives markets.

30-Day Compliance Path and DMO Review Process

Designated contract markets face two options inside the 30-day period: eliminate violating restrictions or furnish the Division of Market Oversight with an explanation of infeasibility. Intermediaries must meet the same impartial access standard on the same timeline.

The CFTC has signaled it will weigh each submission according to its specific facts before deciding on any enforcement steps. As reported by Focus Gaming News, the process leaves room for case-specific evaluation while setting a firm initial deadline.