Page:United States Statutes at Large Volume 124.djvu/1751

 124 STAT. 1725 PUBLIC LAW 111–203—JULY 21, 2010 for trading on a registered entity, contracts traded on a foreign board of trade that provides members or other participants located in the United States with direct access to its electronic trading and order matching system; and ‘‘(C) swap contracts that perform or affect a significant price discovery function with respect to regulated entities. ‘‘(7) EXEMPTIONS.—The Commission, by rule, regulation, or order, may exempt, conditionally or unconditionally, any person or class of persons, any swap or class of swaps, any contract of sale of a commodity for future delivery or class of such contracts, any option or class of options, or any trans- action or class of transactions from any requirement it may establish under this section with respect to position limits.’’. (b) CONFORMING AMENDMENTS.—Section 4a(b) of the Com- modity Exchange Act (7 U.S.C. 6a(b)) is amended— (1) in paragraph (1), by striking ‘‘or derivatives transaction execution facility or facilities or electronic trading facility’’ and inserting ‘‘or swap execution facility or facilities’’; and (2) in paragraph (2), by striking ‘‘or derivatives transaction execution facility or facilities or electronic trading facility’’ and inserting ‘‘or swap execution facility’’. (c) BONA FIDE HEDGING TRANSACTION.—Section 4a(c) of the Commodity Exchange Act is amended— (1) by inserting ‘‘(1)’’ after ‘‘(c)’’; and (2) by adding at the end the following: ‘‘(2) For the purposes of implementation of subsection (a)(2) for contracts of sale for future delivery or options on the con- tracts or commodities, the Commission shall define what con- stitutes a bona fide hedging transaction or position as a trans- action or position that— ‘‘(A)(i) represents a substitute for transactions made or to be made or positions taken or to be taken at a later time in a physical marketing channel; ‘‘(ii) is economically appropriate to the reduction of risks in the conduct and management of a commercial enterprise; and ‘‘(iii) arises from the potential change in the value of— ‘‘(I) assets that a person owns, produces, manufac- tures, processes, or merchandises or anticipates owning, producing, manufacturing, processing, or mer- chandising; ‘‘(II) liabilities that a person owns or anticipates incurring; or ‘‘(III) services that a person provides, purchases, or anticipates providing or purchasing; or ‘‘(B) reduces risks attendant to a position resulting from a swap that— ‘‘(i) was executed opposite a counterparty for which the transaction would qualify as a bona fide hedging transaction pursuant to subparagraph (A); or ‘‘(ii) meets the requirements of subparagraph (A).’’. (d) EFFECTIVE DATE.—This section and the amendments made by this section shall become effective on the date of the enactment of this section. 7 USC 6a note. Contracts.