Congresswoman Maxine Waters, Ranking Member of the House Financial Services Committee, and Congressman Collin C. Peterson, Ranking Member of the House Committee on Agriculture have submitted a motion for leave to file an amicus brief with the U.S. Court of Appeals focusing on the position limits rule promulgated by the Commodity Futures Trading Commission (CFTC).
The CFTC’s rule would limit the amount of certain commodity futures, options or swaps that an investor (who does not make any use of the commodity in question) may own. Congress mandated the rule in the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 in order to protect consumers and the nation’s economy from excessive speculation in agricultural and energy markets such as natural gas and crude oil.
The amicus brief was originally submitted on April 10, 2012 to the U.S. District Court by the 17 sitting Democratic Members of Congress who served on the Conference Committee that drafted the final text of the Wall Street reform law. In September 2012, the District Court struck down the CFTC’s position limits rule and remanded it back to the CFTC, suggesting that the commission was required to make certain factual findings before issuing its rule. Ranking Member Waters’ and Representative Peterson’s motion is a procedural step in the litigation, limited to asking the Appeals Court whether it will consider the amicus brief when it rules on CFTC’s appeal of the District Court ruling.
The Democrats’ brief argues that Congressional intent in enacting Section 737 of Dodd-Frank was to require the CFTC to promulgate a rule on commodity position limits without leaving it discretion to make a finding of necessity prior to imposing position limits. The brief provides the legislative history of the position limit requirement, demonstrating that CFTC’s rulemaking is entirely consistent with Congressional intent.
“As a member of the Dodd-Frank Conference Committee, I know full well that Congress intended for CFTC to act to end speculation in key commodities markets,” Waters stated. “I will continue to work to make sure that happens.”