Subject: FW: Electronic Trading Facilities for Transaction in Exempt Commodities
From: [email-masked]
To: [email-masked]
Cc: [email-masked], [email-masked], [email-masked], [email-masked], [email-masked]
Date: Wed, 2 May 2001 01:51:00 -0700 (PDT)

Mark,

Thank you for the attached information on the impact of EnronOnline becoming 
"Regulated".

I would appreciate it if you could confirm my understanding of the following 
points, which I took from our conversation yesterday:

- It is possible that EnronOnline could become "regulated" as soon as a third 
party company manages a product which is the same as a Product which Enron 
(or another company) is managing, even if the product is physical. You are 
going to investigate and confirm whether or not this applies both to physical 
and financial products or financial only.
- If we become "regulated", the regulations would apply only to the 
Product(s) in which more than one company is posting. In other words, by 
inviting a 3rd party company to manage a product which is the same as one 
managed by Enron, we invite regulation only for that Product. The rest of 
EnronOnline is unaffected.
- The impacts of becoming "regulated" are spelled out in your attached 
document, but the primary impact is additional reporting requirements to the 
CFTC.
- There are no additional issues associated with posting FX products (as far 
as Enron is concerned), but any bank posting their products will need to 
ensure they are compliant with any regulations affecting their activities and 
appropriate reps and warranties to this effect would need to be added to our 
contract with them.
- It is your opinion that the reporting requirements imposed by the CFTC 
would not be such that Enron would be required to reveal sensitive 
information such as volume of buys or volume of sells to market (but it is 
possible that we may be required to add buys and sells together to report 
total transaction volume).
- The $10 million capital adequacy requirement for companies transacting on 
financial products is unchanged, whether we are regulated or unregulated.

Thanks,

Dave

 -----Original Message-----
From:  Taylor, Mark  
Sent: Friday, April 27, 2001 3:32 PM
To: Forster, David; Zipper, Andy
Cc: Greenberg, Mark
Subject: Electronic Trading Facilities for Transaction in Exempt Commodities

Attached is a brief outline of the requirements for electronic trading 
facilities for transactions in exempt commodities.  Exempt commodities are 
all commodities other than financial commodities (e.g. interest rates, 
currencies, securities) and agricultural commodities.