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e-CFR data is current as of October 23, 2020

Amendment


17 CFR--PART 1

View Printed Federal Register page 85 FR 57543 in PDF format.

Amendment(s) published September 15, 2020, in 85 FR 57543

Effective Dates: Nov. 16, 2020

3. Amend §1.12 by:

a. Revising paragraph (a) introductory text;

b. Revising paragraphs (a)(1), (b)(3) and (b)(4); and

c. Adding paragraph (b)(5).

The revisions and additions read as follows:

§1.12   Maintenance of minimum financial requirements by futures commission merchants and introducing brokers.

(a) Each person registered as a futures commission merchant or who files an application for registration as a futures commission merchant, and each person registered as an introducing broker or who files an application for registration as an introducing broker (except for an introducing broker or applicant for registration as an introducing broker operating pursuant to, or who has filed concurrently with its application for registration, a guarantee agreement and who is not also a securities broker or dealer), who knows or should have known that its adjusted net capital at any time is less than the minimum required by §1.17 or by the capital rule of any self-regulatory organization to which such person is subject, or the minimum net capital requirements of the Securities and Exchange Commission if the applicant or registrant is registered with the Securities and Exchange Commission, must:

(1) Give notice, as set forth in paragraph (n) of this section that the applicant's or registrant's capital is below the applicable minimum requirement. Such notice must be given immediately after the applicant or registrant knows or should have known that its adjusted net capital or net capital, as applicable, is less than minimum required amount; and

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(b) *  *  *

(3) 150 percent of the amount of adjusted net capital required by a registered futures association of which it is a member, unless such amount has been determined by a margin-based capital computation set forth in the rules of the registered futures association, and such amount meets or exceeds the amount of adjusted net capital required under the margin-based capital computation set forth in §1.17(a)(1)(i)(B), in which case the required percentage is 110 percent;

(4) For securities brokers or dealers, the amount of net capital specified in Rule 17a-11(b) of the Securities and Exchange Commission (17 CFR 240.17a-11(b)); or

(5) For security-based swap dealers or major security-based swap participants, the amount of net capital specified in Rule 18a-8(b) of the Securities and Exchange Commission (17 CFR 240.18a-8(b)), must file notice to that effect, as soon as possible and no later than twenty-four (24) hours of such event.

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