[Code of Federal Regulations]
[Title 17, Volume 1]
[Revised as of April 1, 2006]
From the U.S. Government Printing Office via GPO Access
[CITE: 17CFR1.31]

[Page 74-77]
 
              TITLE 17--COMMODITY AND SECURITIES EXCHANGES
 
             CHAPTER I--COMMODITY FUTURES TRADING COMMISSION
 
PART 1_GENERAL REGULATIONS UNDER THE COMMODITY EXCHANGE ACT--Table 
of Contents
 
Sec.  1.31  Books and records; keeping and inspection.

    (a)(1) All books and records required to be kept by the Act or by 
these regulations shall be kept for a period of five years from the date 
thereof and shall be readily accessible during the first 2 years of the 
5-year period. All such books and records shall be open to inspection by 
any representative of the Commission or the United States Department of 
Justice.

[[Page 75]]

    (2) A copy of any book or record required to be kept by the Act or 
by these regulations shall be provided, at the expense of the person 
required to keep the book or record, to a Commission representative upon 
the representative's request. Instead of furnishing a copy, such person 
may provide the original book or record for reproduction, which the 
representative may temporarily remove from such person's premises for 
this purpose. All copies or originals shall be provided promptly. Upon 
request, the Commission representative shall issue a receipt provided by 
such person for any copy or original book or record received. At the 
request of the Commission representative, such person shall, upon the 
return thereof, issue a receipt for any copy or original book or record 
returned by the representative.
    (b) Except as provided in paragraph (d) of this section, immediate 
reproductions on either ``micrographic media'' (as defined in paragraph 
(b)(1)(i) of this section) or ``electronic storage media'' (as defined 
in paragraph (b)(1)(ii) this section) may be kept in that form for the 
required time period under the conditions set forth in this paragraph 
(b).
    (1) For purposes of this section:
    (i) The term ``micrographic media'' means microfilm or microfiche or 
any similar medium.
    (ii) The term ``electronic storage media'' means any digital storage 
medium or system that:
    (A) Preserves the records exclusively in a non-rewritable, non-
erasable format;
    (B) Verifies automatically the quality and accuracy of the storage 
media recording process;
    (C) Serializes the original and, if applicable, duplicate units of 
storage media and creates a time-date record for the required period of 
retention for the information placed on such electronic storage media; 
and
    (D) Permits the immediate downloading of indexes and records 
preserved on the electronic storage media onto paper, microfilm, 
microfiche or other medium acceptable under this paragraph upon the 
request of representatives of the Commission or the Department of 
Justice.
    (2) Persons who use either micrographic media or electronic storage 
media to maintain records in accordance with this section must:
    (i) Have available at all times, for examination by representatives 
of the Commission or the Department of Justice, facilities for 
immediate, easily readable projection or production of micrographic 
media or electronic storage media images;
    (ii) Be ready at all times to provide, and immediately provide at 
the expense of the person required to keep such records, any easily 
readable hard-copy image that representatives of the Commission or 
Department of Justice may request;
    (iii) Keep only Commission-require records on the individual medium 
employed (e.g., a disk or sheets of microfiche);
    (iv) Store a duplicate of the record, in any medium acceptable under 
this regulation, at a location separate from the original for the period 
of time required for maintenance of the original; and
    (v) Organize and maintain an accurate index of all information 
maintained on both the original and duplicate storage media such that:
    (A) The location of any particular record stored on the media may be 
immediately ascertained;
    (B) The index is available at all times for immediate examination by 
representatives of the Commission or the Department of Justice;
    (C) A duplicate of the index is stored at a location separate from 
the original index; and
    (D) Both the original index and the duplicate index are preserved 
for the time period required for the records included in the index.
    (3) In addition to the foregoing conditions, persons using 
electronic storage media must:
    (i) Be ready at all times to provide, and immediately provide at the 
expense of the person required to keep such records, copies of such 
records on such approved machine-readable media as defined in Sec.  
15.00(1) of this chapter which any representative of the Commission or 
the Department of Justice

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may request. Records must use a format and coding structure specified in 
the request.
    (ii) Develop and maintain written operational procedures and 
controls (an ``audit system'') designed to provide accountability over 
both the initial entry of required records to the electronic storage 
media and the entry of each change made to any original or duplicate 
record maintained on the electronic storage media such that:
    (A) The results of such audit system are available at all times for 
immediate examination by representatives of the Commission or the 
Department of Justice;
    (B) The results of such audit system are preserved for the time 
period required for the records maintained on the electronic storage 
media; and
    (C) The written operational procedures and controls are available at 
all times for immediate examination by representatives of the Commission 
or the Department of Justice.
    (iii) Either
    (A) Maintain, keep current, and make available at all times for 
immediate examination by representatives of the Commission or Department 
of Justice all information necessary to access records and indexes 
maintained on the electronic storage media; or
    (B) Place in escrow and keep current a copy of the physical and 
logical format of the electronic storage media, the file format of all 
different information types maintained on the electronic storage media 
and the source code, documentation, and information necessary to access 
the records and indexes maintained on the electronic storage media.
    (4) In addition to the foregoing conditions, any person who uses 
only electronic storage media to preserve some or all of its required 
records (``Electronic Recordkeeper'') shall, prior to the media's use, 
enter into an arrangement with at least one third party technical 
consultant (``Technical Consultant'') who has the technical and 
financial capability to perform the undertakings described in this 
paragraph (b)(4). The arrangement shall provide that the Technical 
Consultant will have access to, and the ability to download, information 
from the Electronic Recordkeeper's electronic storage media to any 
medium acceptable under this regulation.
    (i) The Technical Consultant must file with the Commission an 
undertaking in a form acceptable to the Commission, signed by the 
Technical Consultant or a person duly authorized by the Technical 
Consultant. An acceptable undertaking must include the following 
provision with respect to the Electronic Recordkeeper:

    With respect to any books and records maintained or preserved on 
behalf of the Electronic Recordkeeper, the undersigned hereby undertakes 
to furnish promptly to any representative of the United States Commodity 
Futures Trading Commission or the United States Department of Justice 
(the ``Representative''), upon reasonable request, such information as 
is deemed necessary by the Representative to download information kept 
on the Electronic Recordkeeper's electronic storage media to any medium 
acceptable under 17 CFR 1.31. The undersigned also undertakes to take 
reasonable steps to provide access to information contained on the 
Electronic Recordkeeper's electronic storage media, including, as 
appropriate, arrangements for the downloading of any record required to 
be maintained under the Commodity Exchange Act or the rules, 
regulations, or orders of the United States Commodity Futures Trading 
Commission, in a format acceptable to the Representative. In the event 
the Electronic Recordkeeper fails to download a record into a readable 
format and after reasonable notice to the Electronic Recordkeeper, upon 
being provided with the appropriate electronic storage medium, the 
undersigned will undertake to do so, at no charge to the United States, 
as the Representative may request.

    (ii) [Reserved]
    (c) Persons employing an electronic storage system shall provide a 
representation to the Commission prior to the initial use of the system. 
The representation shall be made by the person required to maintain the 
records, the storage system vendor, or another third party with 
appropriate expertise and shall state that the selected electronic 
storage system meets the requirements set forth in paragraph (b)(1)(ii) 
of this section. Persons employing an electronic storage system using 
media other than optical disk or CD-ROM technology shall so state. The 
representation shall be accompanied by the type of oath or affirmation 
described in Sec.  1.10(d)(4).

[[Page 77]]

    (d) Trading cards, documents on which trade information is 
originally recorded in writing, and written orders required to be kept 
pursuant to Sec.  1.35(a), (a-1)(1), (a-1)(2) and (d) must be retained 
in hard-copy for the required time period.

(Approved by the Office of Management and Budget under control numbers 
3038-0007 and 3038-0022)

[41 FR 3194, Jan. 21, 1976, as amended at 46 FR 22, Jan. 2, 1981; 46 FR 
63035, Dec. 30, 1981; 58 FR 27464, 27467, May 10, 1993; 62 FR 24031, May 
2, 1997; 64 FR 28742, May 27, 1999]