Trading Facility Law and Legal Definition
(A) In general. The term "trading facility" means “a person or group of persons that constitutes, maintains, or provides a physical or electronic facility or system in which multiple participants have the ability to execute or trade agreements, contracts, or transactions--
(i) by accepting bids or offers made by other participants that are open to multiple participants in the facility or system; or
(ii) through the interaction of multiple bids or multiple offers within a system with a pre-determined non-discretionary automated trade matching and execution algorithm.
(B) Exclusions. The term "trading facility" does not include--
(i) a person or group of persons solely because the person or group of persons constitutes, maintains, or provides an electronic facility or system that enables participants to negotiate the terms of and enter into bilateral transactions as a result of communications exchanged by the parties and not from interaction of multiple bids and multiple offers within a predetermined, nondiscretionary automated trade matching and execution algorithm;
(ii) a government securities dealer or government securities broker, to the extent that the dealer or broker executes or trades agreements, contracts, or transactions in government securities, or assists persons in communicating about, negotiating, entering into, executing, or trading an agreement, contract, or transaction in government securities (as the terms "government securities dealer", "government securities broker", and "government securities" are defined in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a))); or
(iii) facilities on which bids and offers, and acceptances of bids and offers effected on the facility, are not binding.
Any person, group of persons, dealer, broker, or facility described in clause (i) or (ii) is excluded from the meaning of the term "trading facility" for the purposes of this Act [7 USCS §§ 1 et seq.] without any prior specific approval, certification, or other action by the Commission.
(C) Special rule. A person or group of persons that would not otherwise constitute a trading facility shall not be considered to be a trading facility solely as a result of the submission to a derivatives clearing organization of transactions executed on or through the person or group of persons.” (7 USCS § 1a)
Legal Definition list
Related Legal Terms
- Accommodation Trading
- Advanced Nuclear Facility [Energy]
- Advanced Technology User Facility
- Affiliate of a Futures Commission Merchant, Commodity Trading Advisor, Commodity Pool Operator or Introducing Broker
- Air Facility System
- Air Navigation Facility
- Air Navigation Facility Certificate
- Alternative Trading System
- Ammonium Nitrate Facility
- Anonymous Trading