[Code of Federal Regulations]
[Title 17, Volume 1]
[Revised as of April 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 17CFR41.15]

[Page 465-466]
 
              TITLE 17--COMMODITY AND SECURITIES EXCHANGES
 
             CHAPTER I--COMMODITY FUTURES TRADING COMMISSION
 
PART 41_SECURITY FUTURES PRODUCTS--Table of Contents
 
                 Subpart B_Narrow-Based Security Indexes
 
Sec.  41.15  Exclusion from definition of narrow-based security index for 

indexes composed of debt securities.

    (a) An index is not a narrow-based security index if:
    (1)(i) Each of the securities of an issuer included in the index is 
a security, as defined in section 2(a)(1) of the Securities Act of 1933 
and section 3 (a)(10) of the Securities Exchange Act of 1934 and the 
respective rules promulgated thereunder, that is a note, bond, 
debenture, or evidence of indebtedness;
    (ii) None of the securities of an issuer included in the index is an 
equity security, as defined in section 3(a)(11) of the Securities 
Exchange Act of 1934 and the rules promulgated thereunder;
    (iii) The index is comprised of more than nine securities that are 
issued by more than nine non-affiliated issuers;
    (iv) The securities of any issuer included in the index do not 
comprise more than 30 percent of the index's weighting;
    (v) The securities of any five non-affiliated issuers included in 
the index do not comprise more than 60 percent of the index's weighting;
    (vi) Except as provided in paragraph (a)(1)(viii) of this section, 
for each security of an issuer included in the index one of the 
following criteria is satisfied:
    (A) The issuer of the security is required to file reports pursuant 
to section 13 or section 15(d) of the Securities Exchange Act of 1934;
    (B) The issuer of the security has a worldwide market value of its 
outstanding common equity held by non-affiliates of $700 million or 
more;
    (C) The issuer of the security has outstanding securities that are 
notes, bonds, debentures, or evidences of indebtedness having a total 
remaining principal amount of at least $1 billion;
    (D) The security is an exempted security as defined in section 
3(a)(12) of the Securities Exchange Act of 1934 and the rules 
promulgated thereunder; or
    (E) The issuer of the security is a government of a foreign country 
or a

[[Page 466]]

political subdivision of a foreign country; and
    (vii) Except as provided in paragraph (a)(1)(viii) of this section, 
for each security of an issuer included in the index one of the 
following criteria is satisfied:
    (A) The security has a total remaining principal amount of at least 
$250,000,000; or
    (B) The security is a municipal security (as defined in section 
3(a)(29) of the Securities Exchange Act of 1934 and the rules 
promulgated thereunder) that has a total remaining principal amount of 
at least $200,000,000 and the issuer of such municipal security has 
outstanding securities that are notes, bonds, debentures, or evidences 
of indebtedness having a total remaining principal amount of at least $1 
billion; and
    (viii) Paragraphs (a)(1)(vi) and (a)(1)(vii) of this section will 
not apply to securities of an issuer included in the index if:
    (A) All securities of such issuer included in the index represent 
less than five percent of the index's weighting; and
    (B) Securities comprising at least 80 percent of the index's 
weighting satisfy the provisions of paragraphs (a)(1)(vi) and 
(a)(1)(vii) of this section.
    (2)(i) The index includes exempted securities, other than municipal 
securities as defined in section 3(a)(29) of the Securities Exchange Act 
of 1934 and the rules promulgated thereunder, that are:
    (A) Notes, bonds, debentures, or evidences of indebtedness; and
    (B) Not equity securities, as defined in section 3(a)(11) of the 
Securities Exchange Act of 1934 and the rules promulgated thereunder; 
and
    (ii) Without taking into account any portion of the index composed 
of such exempted securities, other than municipal securities, the 
remaining portion of the index would not be a narrow-based security 
index meeting all the conditions under paragraph (a)(1) of this section.
    (b) For purposes of this section:
    (1) An issuer is affiliated with another issuer if it controls, is 
controlled by, or is under common control with, that issuer.
    (2) For purposes of this section, ``control'' means ownership of 20 
percent or more of an issuer's equity, or the ability to direct the 
voting of 20 percent or more of the issuer's voting equity.
    (3) The term ``issuer'' includes a single issuer or group of 
affiliated issuers.

[71 FR 39541, July 13, 2006]