§ 27d. — Administration of the predominance test.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 7USC27d]
TITLE 7--AGRICULTURE
CHAPTER 1--COMMODITY EXCHANGES
Sec. 27d. Administration of the predominance test
(a) In general
No provision of the Commodity Exchange Act [7 U.S.C. 1 et seq.]
shall apply to, and the Commodity Futures Trading Commission shall not
regulate, a hybrid instrument, unless the Commission determines, by or
under a rule issued in accordance with this section, that--
(1) the action is necessary and appropriate in the public
interest;
(2) the action is consistent with the Commodity Exchange Act [7
U.S.C. 1 et seq.] and the purposes of the Commodity Exchange Act;
and
(3) the hybrid instrument is not predominantly a banking product
under the predominance test set forth in section 27c(b) of this
title.
(b) Consultation
Before commencing a rulemaking or making a determination pursuant to
a rule issued under sections 27 to 27f of this title, the Commodity
Futures Trading Commission shall consult with and seek the concurrence
of the Board of Governors of the Federal Reserve System concerning--
(1) the nature of the hybrid instrument; and
(2) the history, purpose, extent, and appropriateness of the
regulation of the hybrid instrument under the Commodity Exchange Act
[7 U.S.C. 1 et seq.] and under appropriate banking laws.
(c) Objection to Commission regulation
(1) Filing of petition for review
The Board of Governors of the Federal Reserve System may obtain
review of any rule or determination referred to in subsection (a) of
this section in the United States Court of Appeals for the District
of Columbia Circuit by filing in the court, not later than 60 days
after the date of publication of the rule or determination, a
written petition requesting that the rule or determination be set
aside. Any proceeding to challenge any such rule or determination
shall be expedited by the court.
(2) Transmittal of petition and record
A copy of a petition described in paragraph (1) shall be
transmitted as soon as possible by the Clerk of the court to an
officer or employee of the Commodity Futures Trading Commission
designated for that purpose. Upon receipt of the petition, the
Commission shall file with the court the rule or determination under
review and any documents referred to therein, and any other relevant
materials prescribed by the court.
(3) Exclusive jurisdiction
On the date of the filing of a petition under paragraph (1), the
court shall have jurisdiction, which shall become exclusive on the
filing of the materials set forth in paragraph (2), to affirm and
enforce or to set aside the rule or determination at issue.
(4) Standard of review
The court shall determine to affirm and enforce or set aside a
rule or determination of the Commodity Futures Trading Commission
under this section, based on the determination of the court as to
whether--
(A) the subject product is predominantly a banking product;
and
(B) making the provision or provisions of the Commodity
Exchange Act [7 U.S.C. 1 et seq.] at issue applicable to the
subject instrument is appropriate in light of the history,
purpose, and extent of regulation under such Act, sections 27 to
27f of this title, and under the appropriate banking laws,
giving deference neither to the views of the Commodity Futures
Trading Commission nor the Board of Governors of the Federal
Reserve System.
(5) Judicial stay
The filing of a petition by the Board pursuant to paragraph (1)
shall operate as a judicial stay, until the date on which the
determination of the court is final (including any appeal of the
determination).
(6) Other authority to challenge
Any aggrieved party may seek judicial review pursuant to section
6(c) of the Commodity Exchange Act [7 U.S.C. 9, 15] of a
determination or rulemaking by the Commodity Futures Trading
Commission under this section.
(Pub. L. 106-554, Sec. 1(a)(5) [title IV, Sec. 406], Dec. 21, 2000, 114
Stat. 2763, 2763A-459.)
References in Text
The Commodity Exchange Act, referred to in subsecs. (a), (b)(2), and
(c)(4)(B), is act Sept. 21, 1922, ch. 369, 42 Stat. 998, as amended,
which is classified generally to this chapter. For complete
classification of this Act to the Code, see section 1 of this title and
Tables.
Codification
Section was enacted as part of the Legal Certainty for Bank Products
Act of 2000, and also as part of the Commodity Futures Modernization Act
of 2000, and not as part of the Commodity Exchange Act which comprises
this chapter.
Section Referred to in Other Sections
This section is referred to in sections 1a, 2, 7a-1, 16, 27, 27f of
this title; title 15 section 78c.
