WASHINGTON, July 24, 2026 — The U.S. Commodity Futures Trading Commission’s Division of Market Oversight (DMO) issued an advisory Friday reminding designated contract markets (DCMs) that Broad Template Certifications for event contracts should not be submitted under Commission Regulation 40.2(a). The division said the practice limits its ability to evaluate proposed contracts and determine whether DCMs have provided the information required under the Commodity Exchange Act and Commission regulations.
Broad template certifications under scrutiny
The advisory addresses what DMO describes as “Broad Template Certifications,” in which a DCM bundles multiple potential event contract variations with differing settlement sources or methodologies into a single certification. According to the division, the practice hampers its ability to determine whether a DCM has provided the information, explanation and analysis required under Regulation 40.2 and whether it has adequately evaluated the settlement methodologies, data sources and compliance with applicable core principles for all contract variations it intends to list.
It also states that Broad Template Certifications prevent market participants from accessing and evaluating that information.
Class certification requirements outlined
DMO advised that an event contract series certification should instead be filed pursuant to Commission Regulation 40.2(d) or Commission Regulation 40.3. To qualify for class certification under Regulation 40.2(d), an event contract series must reference a prior, specific contract that was certified under Regulation 40.2(a) or approved under Regulation 40.3.
Among other regulatory conditions, contracts within the class must use identical pricing sources, formulas, procedures and methodologies for calculating reference prices and payment obligations. A DCM may reference only its own previously certified or approved contracts, rather than contracts submitted by another designated contract market.
Sports, elections and weather contracts cited
The advisory provides several examples of event contract series that could potentially qualify for class certification when the applicable regulatory conditions are satisfied. These include outcomes of games in a tournament or series governed by identical rules, election outcomes arising from a single ballot, nominees in a single awards show selected through the same process, and daily rainfall totals reported by the same official weather station using the same measurement methodology.
DMO said a DCM could potentially certify a series covering all matches in the 2026 FIFA World Cup by referencing a previously certified Regulation 40.2(a) contract involving Mexico and South Africa, provided the contracts use identical pricing sources, formulas, procedures and methodologies for calculating reference prices and payment obligations.
However, the advisory says a DCM should not certify a series covering the 2026 MLS Leagues Cup by referencing that FIFA World Cup contract because the competitions have different rules and therefore different contract pricing sources, formulas, procedures and methodologies for calculating reference prices and payment obligations. It notes, for example, that the 2026 FIFA World Cup permits draws during the first round of the tournament, while the 2026 MLS Leagues Cup does not.
Settlement sources expected before listing
DMO said DCMs are expected to identify specifically in their certifications the settlement sources upon which an event contract or class of contracts relies before listing. According to the advisory, identifying those settlement sources is necessary to enable a complete evaluation of a contract’s compliance with applicable core principles.
The advisory states that cash-settled derivatives, including event contracts, may create an incentive to manipulate or artificially influence the data from which a product’s price is derived. DCMs are therefore expected to consider the potential for manipulation or distortion of the cash-settlement price, the reliability of that price as an indicator of cash-market values, and the commercial acceptability, public availability and timeliness of the price series used to calculate cash-settlement prices.
Inadequate certifications may face further review
Where DMO determines that the self-certification of a contract or series of contracts is inadequate, it may recommend that the Commission stay the listing under Commission Regulation 40.2(c). The Commission may also require a DCM to withdraw a class certification and resubmit each individual contract, or certain individual contracts, for review under Commission Regulation 40.2 or Commission Regulation 40.3.
The advisory states that DCMs should not assume that certifying multiple contracts in a single filing insulates any individual contract from separate review. It also encourages DCMs developing event contracts or event contract series that raise unique or novel questions regarding the appropriate certification approach to consult DMO staff before filing.
Consolidated submissions remain available
The advisory clarifies that DCMs may continue using the CFTC’s consolidated submission functionality to submit a single set of supporting documents applicable to separate but related contract certifications. Common rulebooks, settlement-source analyses, terms and conditions, and other shared exhibits may be submitted once and incorporated by reference across related certifications.
However, each contract must still be certified individually under Commission Regulation 40.2(a) or as part of an eligible class under Commission Regulation 40.2(d), and the submission must include all documents and information required by Regulation 40.2.
Why it matters
The advisory provides additional guidance on how DMO expects DCMs to submit event contract series for review.
While the advisory does not create new binding rules, amend existing regulations or establish a no-action position, it clarifies when closely related event contracts may qualify for class certification under Commission Regulation 40.2(d) and reiterates that Broad Template Certifications should not be submitted under Commission Regulation 40.2(a).
