WASHINGTON, DC - Congressman Austin Scott (R-GA), Chairman of the House Agriculture Committee’s Subcommittee on Commodity Exchanges, Energy, and Credit Subcommittee, today held a public hearing to examine the reauthorization of the Commodity Futures Trading Commission (CFTC) and the challenges end-users face as they use these markets.

Authorization for the CFTC lapsed in September 2013. During the 113th Congress, the House of Representatives passed H.R. 4413, the Customer Protection and End-User Relief Act, which would have reauthorized and made improvements to the operations of the CFTC. The Senate did not take up the bill. The House Agriculture Committee began its series of hearings relating to the oversight and reauthorization of the CFTC in February, when it heard from CFTC Chairman Timothy Massad.

"Americans across the country, and many in my home state of Georgia, depend on these well-functioning markets to manage their businesses and mitigate risk,” said Chairman Austin Scott. “From small family farms to large manufacturers, a wide range of end-users have been subject to unintended consequences and unnecessary regulations with the implementation of Title VII. These individuals and companies must be able to easily access risk management tools as they work to feed, clothe, and provide affordable fuel to consumers here and around the world.  As the committee moves towards reauthorization, we will promote policies that enhance stability and confidence in the derivatives markets, as well as strike a balance between access and integrity. These markets must work efficiently for end-users and serve as a tool, rather than a hindrance, for their businesses.”

“I am pleased to have Austin Scott leading our efforts as the Agriculture Committee works towards reauthorization of the CFTC in the coming months,” said Chairman K. Michael Conaway, chairman of the full committee. “We will strive to ensure end-users are able to use futures, swaps and options as seamlessly as possible. Rather than navigating through complex rules and regulations, these individuals and businesses should be able to use that time serving their customers and focusing on their businesses.”

The subcommittee will hold a hearing to examine the views of market participants this Wednesday, March 25, at 1:30 p.m. Details can be found here.

Written testimony provided by the witnesses from today’s hearing is linked below. Click here for more information, including the archived webcast.

Witness List:

Mr. Douglas Christie, President, Cargill Cotton Testifying on Behalf of the Commodity Markets Council  

Mr. Lael E. Campbell, Director Regulatory & Government Affairs, Constellation, an Exelon Company Testifying on Behalf of the Edison Electric Institute  

Ms. Lisa A. Cavallari, Director of Fixed Income Derivatives, Russell Investments Testifying on Behalf of the American Benefits Council  

Mr. Mark Maurer, Chief Executive Officer, INTL FCStone Markets, LLC  

Mr. Howard Peterson, Jr., President & Owner, Peterson Oil Service Testifying on Behalf of the New England Fuel Institute

 Opening Statement of Chairman Austin Scott
House Committee on Agriculture Subcommittee on Commodity Exchanges, Energy, and Credit
RE:  Reauthorizing the CFTC:  End-User Views
(Remarks as Prepared)

Good Afternoon.  I’d like to welcome you to the inaugural hearing of the Commodity Exchanges, Energy and Credit subcommittee of the House Committee on Agriculture.

I am honored that Chairman Conaway asked me to serve the Committee this Congress by Chairing our newest subcommittee.  When Mr. Conaway asked me to step into this role, he said that he wanted to ensure that the Committee never lost sight of the importance of derivatives markets not only to our traditional agricultural firms, but also to the wider economy.?

Today’s hearing will examine the reauthorization of the CFTC and the challenges end-users are facing as they use these markets to manage the risks of doing business in a global market place. 

We are fortunate to be joined today by a panel of distinguished witnesses, each of whom has a unique perspective of the challenges facing the end-users of derivatives.  We look forward to hearing their thoughts on what issues the Committee should be considering during the reauthorization process.

Last week, Chairman Conaway laid out three principles for guiding the committee’s work: Derivatives markets exist to meet the needs of hedgers; regulatory requirements should be both minimized and justified; and regulations should provide clarity and certainty.

These principles, along with the goal to balance access with integrity, will frame our discussion today as we hear from our witnesses. Over the past two Congresses, the Committee has heard from dozens of witnesses who have shared with us the difficulties that they’ve had understanding and complying with the flurry of rulemakings issued because of Dodd-Frank.

As I've listened to them, two things have become clear: first, no witness has called for a repeal of Title VII (seven). In fact, most witnesses have supported the goals of Title VII (seven).  But, and this is my second point, the process of planning, drafting, and enacting the rules could be at best called "troubling." 

Today's task is to look back at the process of the past five years and to examine the places where this committee can take action. We won't be repealing Dodd-Frank, and we won't be working to weaken its market-wide protections of Title VII (seven). But, we will be looking to see where our action can clarify Congressional intent, minimize regulatory burdens, and most importantly, preserve the ability for these necessary risk management markets to serve American farmers, ranchers, and businesses.

I want to thank the witnesses for appearing before us today. I know many of you traveled to be here and worked hard to prepare your remarks over the past week. We are appreciative of your time and efforts.

With that, I'll turn to our Ranking Member and fellow Georgia Representatives, Mr. Scott.

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