Congress is expected to vote Friday to approve the Commodity Futures Modernization Act of 2000, a bill that will reauthorize the Commodity Exchange Act, repeal the ban on single stock futures and provide legal certainty for the swaps market. The legislation generally provides:

• "Legal certainty" for non-retail swaps (if they are not traded on a futures-style trading exchange).

• No new "legal certainty" for retail swaps.

• Bank products are clearly excluded from regulation by the Commodity Futures Trading Commission, as follows:
  
  
  • All banking products commonly offered by any bank on or before Dec. 5, 2000, as certified by the appropriate banking regulator, are excluded from CFTC jurisdiction.
  • Any new banking product that is not indexed to a commodity is excluded from CFTC jurisdiction.
  • Any new hybrid banking product (one that is indexed to a commodity) is excluded from CFTC jurisdiction if it is predominantly a banking product.
  • If the CFTC believes that a new hybrid banking product is not predominantly a banking product, and the CFTC wishes to ban or regulate it, the CFTC must first consult with the Federal Reserve. If the Federal Reserve disagrees with the CFTC, then the issue goes before the DC Appeals Court on an expedited basis -- the so-called jump ball provision.
    

• The Securities and Exchange Commission has enforcement authority, on a case-by-case basis, to take action against persons engaging in insider trading, manipulation, or fraud in connection with equity swaps.