An exchange is usually organized as a nonprofit corporation, created to furnish its members with a place for the transaction of their business. The term "exchange" may also mean the exchange hall where the members buy and sell on their own behalf or as brokers for customers. An exchange may be organized for dealings in securities or in commodities and does not participate in the business transacted among its membership, makes no sales or purchases of the securities or commodities traded upon it, and pays no dividends to its membership.
An exchange may be incorporated under general laws or organized under a special charter granted by the legislature, or it may be an unincorporated organization. A security listed on a securities exchange may be withdrawn or stricken from listing pursuant to the rules of the exchange. In addition, provisions of the Securities Exchange Act of 1934 (15 USCS §§ 78a et seq.) permit the Securities and Exchange Commission to order delisting of a security registered with a national exchange upon application by the exchange or the issuer.
Exchanges are governed by such constitution, bylaws and rules and govern the manner in which business is conducted on the exchange and the grounds for discipline and expulsion of members, Transactions on exchanges in commodities requiring future delivery and payment are illegal in some jurisdictions under statutes prohibiting gambling. Commodities in general are economic goods. Commodity exchange rules commonly regulate futures contracts among brokers and the Commodity Exchange Act (7 USCS §§ 1 et seq.) regulates futures transactions conducted through interstate commerce.
