Bob and Sara -

 As we discussed, I enclose the cover page from the lengthy CFTC
policy paper relating to regulation of Ag Options.  This paper was never
approved by the full Commission and does not represent CFTC policy.  I also
enclose:

 (i) An outline of the application for designation as a contract
market (a recent example is the application of BrokerTec Futures Exchange
LLC, published at 65 F.R. 36667 (June 9, 2000));

 (ii) Excerpts from a report by the General Accounting Office
discussing issues relating to the reauthorization of the CFTC (May 1999).
(This represents much of the seed work for S. 2679 and deals with certain of
the issues we discussed yesterday.); and

 (iii) Introductory notes to CFTC revisions to its Rules relating
to agricultural trade options (December 6, 1999).

The exemption we discussed was for an entity called SwapClear, referred to
in the GAO report.  During one of our conversations, Bob referred to
multilateral transaction execution facilities.  The Commission has proposed
regulations on this subject.  They are reported at 65 F.R. 38985 (June 22,
2000) (CCH Commodity Futures Law Reporter paragraph 28,153).

Regards.

- Larry

 <<~att341.uni>>

 - ~att341.uni

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