Notice No. 00-370
November 17, 2000

TO: ALL NYMEX AND COMEX DIVISION MEMBERS

FROM: Neal L. Wolkoff, Executive Vice President

DATE:  November 17, 2000

RE: Notice of CFTC Approval of Amendments to NYMEX Rule 6.21C and Related 
Implementation of Electricity EFS Program
____________________________________________________________________

Please be advised that the CFTC has approved amendments to NYMEX Rule 6. 21C 
("EXCHANGE OF FUTURES FOR, OR IN CONNECTION WITH, SWAP TRANSACTIONS FOR 
FUTURES CONTRACTS TRADED ONLY ON VIA NYMEX ACCESS").  The amendments, which 
are shown below, permit the exchange of futures for swaps ("EFS") for NYMEX 
Division electricity futures contracts.  The EFS program for electricity 
futures will go into effect on Monday, November 27, 2000.

 One change from the terms of the rule should be noted.  Rule 6.21C provides 
for report of EFS transactions to be given to the Exchange "via NYMEX 
ACCESS."  However, this functionality still needs to be added to NYMEX 
ACCESS.  Therefore, the Exchange,s current procedures instead provide for 
reporting EFS transactions to Exchange Floor Dept. staff located in the Late 
Submissions Area on the NYMEX trading floor in the same manner as the 
reporting of EFP transactions. Such reports of EFS transactions would be 
subsequently disseminated to NYMEX ACCESS System Users through a bulletin 
message sent via NYMEX ACCESS.

 As a reminder, it is necessary for market participants to comply with the 
CFTC,s EFP-related reporting and recordkeeping regulations as if these 
regulations applied to EFS transactions.  Specifically, the Exchange will 
require:

1) Each Exchange member, futures commission merchant ("FCM"), and introducing 
broker ("IB") to comply with the requirements of Commission Regulation 
1.35(a) as if this regulation applied to EFS transactions and will further 
require each Exchange member, FCM, and IB to provide the required records to 
the Exchange for inspection upon request;

2) Each customer to comply with the requirements of Commission 
Regulation1.35(a-2)(2) as if this regulation applied to EFS transactions and 
will further require each customer to provide the required records to the 
Exchange for inspection upon request;

3) Each Exchange clearing member, FCM, and foreign broker to comply with the 
requirements of Commission Regulations 17.00(a)(1) and (2) as if these 
regulations applied to EFS transactions, and NYMEX will further require each 
Exchange clearing member, FCM, and foreign broker to file the required 
records with the Exchange;

4) Each trader who holds or controls a reportable futures position to comply 
with the requirements of Commission Regulation 18.05 as if this regulation 
applied to EFS transactions, and NYMEX will further require each trader to 
provide the required records to the Exchange for inspection upon request; and

5) Upon the request of the Commission, each FCM, IB, foreign broker, and 
trader to comply with the requirements of Commission Regulations 
24.03(e)(1)(iii) and (e)(2)(iv), and NYMEX will further require each FCM, IB, 
foreign broker, and trader to file the required records at the place and 
within the time frame specified by the Exchange.

  If you have any questions concerning the operation of this program, please 
contact Rick Taibi, Assistant Director, NYMEX ACCESS Operations, NYMEX ACCESS 
Department, at (212) 299-2677, or George Henderson, Vice President, Floor 
Department, at (212) 299-2071.


APPROVED AMENDMENTS TO NYMEX RULE 6.21C

(Brackets indicate additions.)

Rule 6.21C.  EXCHANGE OF FUTURES FOR, OR IN CONNECTION WITH, SWAP 
TRANSACTIONS FOR FUTURES CONTRACTS TRADED ONLY ON VIA NYMEX ACCESS

 (A) (1) An exchange of futures for, or in connection with, a swap (EFS) 
consists of two discrete, but related, transactions; a swap transaction and a 
futures transaction.  At the time such transaction is effected, the buyer and 
seller of the futures must be, respectively, the seller and the buyer of the 
swap.  The swap component shall involve the commodity underlying the futures 
contract (or a derivative, by-product or related product of such commodity).  
The quantity covered by the swap must be approximately equivalent to the 
quantity covered by the futures contracts.  The swap component of an EFS 
transaction must comply with the requirements of Commission Regulation Part 
35 (Exemption of Swap Agreements).  The initial term of the pilot program 
shall be three years from the effective date of this Rule 6.21C.

(2)The pilot program is available only to commercial market participants. For 
purposes of this rule, a "commercial market participant" shall include a 
person or entity that transacts business in the normal channels of commerce 
in the cash commodity or related commodity underlying the EFS posted on the 
Exchange and also shall include an entity that regularly maintains a book of 
and acts as a dealer in swap transactions.

(B) The report of an EFS transaction involving a futures contract that is not 
listed for trading on the Exchange trading floor and instead is listed for 
trading only on NYMEX ACCESS shall be given to the Exchange via NYMEX ACCESS 
during the hours of trading on NYMEX ACCESS for that futures contract.

(C) A report of such EFS transaction shall be submitted to the Exchange by 
each Clearing Member representing the buyer and/or seller.  Such report shall 
identify the EFS as made under this Rule and shall contain the following 
information: a statement that the swap component of the EFS complied with the 
requirements of Part 35 at the time the EFS was entered into between the 
buyer and seller, a statement that the EFS has resulted or will result in a 
change of payments or other such change, the kind and quantity of the 
futures, the price at which the futures transaction is to be cleared, the 
names of the Clearing Member(s) and customers and such other information as 
the Exchange may require.  Such report (form) shall be submitted to the 
Compliance Department by 12:00 p.m. New York time, no later than two (2) 
Exchange business days after the day of posting the EFS via NYMEX ACCESS.

(D) Each buyer and seller must satisfy the Exchange, at its request, that the 
transaction is a legitimate EFS transaction.  Upon the request of the 
Exchange, all documentary evidence relating to the EFS, including a master 
swap agreement and any supplements thereto, shall be obtained by the Clearing 
Members from the buyer or seller and made available by the Clearing Members 
for examination by the Exchange.

(E) A report of each EFS transaction shall be given and notice thereof shall 
be posted on NYMEX ACCESS in the manner provided by the Exchange on the day 
that the transaction thereto was made, or if such agreement was made after 
the close of trading, then on the next business day.  EFS transactions shall 
be cleared through the Exchange in accordance with normal procedures, shall 
be clearly identified and marked in the same manner as EFP transactions, and 
shall be recorded by the Exchange and by the Clearing Members involved.

(F) All omnibus accounts and foreign brokers shall submit a signed EFS 
reporting agreement in the form prescribed by the Exchange to the Exchange's 
Compliance Department.  Such Agreement shall provide that any omnibus account 
or foreign broker identified by a Clearing Member (or another omnibus account 
or foreign broker) as the buyer or seller of an EFS pursuant to Rule 
6.21C(C), shall supply the name of its customer and such other information as 
the Exchange may require.  Such information shall be submitted to the 
Exchange_s Compliance Department by 12:00 p.m. New York time no later than 
two (2) Exchange business days after the day of posting the EFS on the Floor 
of the Exchange.  Failure by an omnibus account or foreign broker to submit 
either the agreement or the particular EFS information to the Exchange may 
result in a hearing by the Business Conduct Committee to limit, condition or 
deny access of such omnibus account or foreign broker to the market.

(G) The Board  may, by resolution, authorize the posting of EFS transactions 
in any or all of the
futures contracts specified below.

Futures Contract   EFS Reporting Deadline for Expiring Contract

Middle East Sour Crude Oil   An EFS is permitted in the expiring futures 
contract  of the Middle East Sour Crude Oil futures contract at any time 
before 12:00 p.m. New York time on the last business day of the contract 
month, provided, however, that an EFS which establishes a futures position 
for both the buyer and the seller shall not be permitted after the 
termination of trading.

[ Electricity Futures   An EFS is permitted in an expiring electricity 
futures contract at any time before 10:00 a.m. New York time on the first 
business day following termination of trading in the applicable futures 
contract month provided, however, that an EFS which establishes a futures 
position for both the buyer and the seller shall not be permitted after the 
termination of trading for that contract month.]


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