Following last week’s ruling by a federal court in Washington, DC, throwing out the CFTC position limit rule, CME Group said Wednesday it is scrapping revisions to its current position limit rules, which the exchange operator had planned in order to comply with the new regulatory landscape.

Last Friday the position limit rule was “vacated and remanded to the Commission for further proceeding” by District Judge Robert Wilkins, a move that is viewed as a major victory for market speculators (see Daily GPI, Oct. 1). Two Wall Street groups challenged the rule in court in December, arguing that the U.S. Commodity Futures Trading Commission (CFTC) adopted the rule without first determining that there was excessive speculation in commodity and swaps markets and failed to conduct a meaningful cost-benefit analysis of the rule.

Following the court’s action last week, the CFTC fired back Tuesday as commissioners Gary Gensler and Bart Chilton said they will attempt to have the rule — which is a key provision of the Dodd-Frank Wall Street Reform Act — reinstated (see Daily GPI, Oct. 3). “I, for one, will continue to push hard for what Congress mandated: a position limits rule. I think the court opinion is deeply flawed,” Chilton said in a speech to the G-20’s Agricultural Market Information System Roundtable on Public-Private Dialogue in Rome, Italy.

On Wednesday CME Group said it has changed course. “In light of the action by the district court, the exchanges have withdrawn Submission No. 12-299, which was submitted to the CFTC on Sept. 27, 2012, and indicated that the exchanges were adopting revisions to Rule 559 (Position Limits and Exemptions) in connection with the Commission’s Position Limits Rule,” CME said in an email notice. “The exchanges will not be adopting any revisions to Rule 559 at this time and will continue to consider all requests for exemptions subject to the existing provisions of Rule 559.”

A year ago the Commission narrowly voted out the rule, which established limits to curb “excessive speculation” in 28 core physical commodity contracts, four of which are energy contracts: Nymex Henry Hub Natural Gas, Nymex Light Sweet Crude Oil, Nymex New York Harbor Gasoline Blendstock and Nymex New York Harbor Heating Oil (see Daily GPI, Oct. 19, 2011).

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