[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: 17CFR32.3]

[Page 382]
 
              TITLE 17--COMMODITY AND SECURITIES EXCHANGES
 
             CHAPTER I--COMMODITY FUTURES TRADING COMMISSION
 
PART 32_REGULATION OF COMMODITY OPTION TRANSACTIONS--Table of Contents
 
Sec.  32.3  Unlawful commodity option transactions.

    (a) On and after January 17, 1977, it shall be unlawful for any 
person to accept any money, securities, or property (or to extend credit 
in lieu thereof) from an option customer as payment of the purchase 
price in connection with a commodity option transaction unless such 
person is registered as a futures commission merchant under the Act and 
such registration shall not have expired, been suspended (and the period 
of suspension has not expired) or revoked.
    (b) On and after January 17, 1977, it shall be unlawful for:
    (1) Any person to solicit or accept orders (other than in a clerical 
capacity) for the purchase or sale of any commodity option, or to 
supervise any person or persons so engaged, unless such person is:
    (i) Registered as a futures commission merchant under the Act, or
    (ii) If such person is an individual, registered under the act as an 
associated person of a specified person registered as a futures 
commission merchant under the Act;
    (2) Any futures commission merchant to permit an individual to 
become or remain associated with such futures commission merchant as a 
partner, officer or employee (or in any similar status or position 
involving similar functions) in any capacity involving such 
solicitation, acceptance or supervision if such futures commission 
merchant knew or should have known that such individual was not 
registered as an associated person or that such registration has 
expired, been suspended (and the period of suspension has not expired) 
or revoked;
    (c) A person required to register as a futures commission merchant 
or as an associated person in accordance with this section which 
furnishes the services specified in that portion of section 1a of the 
Act defining the term ``commodity trading advisor'' shall not be 
included in the term commodity trading advisor if:
    (1) At the time such services are furnished, such person is 
registered as a futures commission merchant, as a floor broker or as an 
associated person under the Act, and such registration shall not have 
expired, been suspended (and the period of suspension has not expired) 
or revoked; and
    (2) The furnishing of such services is solely incidental to the 
conduct of such person's activities relating to commodity option 
transactions.
    (d) A person registered as a futures commission merchant under the 
Act, who is required to register as such by virtue of this section, need 
not register as such in order to comply with this section, but shall 
immediately notify the Commission in writing, specifying the date such 
person commenced or intends to commence engaging in activities otherwise 
requiring registration under this section.
    (e) A person registered as an associated person or as a floor broker 
under the Act, who is required to register as an associated person by 
virtue of this section, need not register as such in order to comply 
with this section, but the futures commission merchant employing such 
person shall immediately notify the Commission in writing, specifying 
the date such person commenced or intends to commence engaging in 
activities otherwise requiring registration under this section.

(7 U.S.C. 2, 6c(a), 6c(b) and 12a (Supp. V, 1975))

[41 FR 51814, Nov. 24, 1976, as amended at 42 FR 61831, Dec. 6 1977; 59 
FR 5703, Feb. 8, 1994]