Sub Chapter IV Commodity Broker Liquidation
Sec. 764. Voidable transfer
(a) Except as otherwise provided in this section, any transfer by
the debtor of property that, but for such transfer, would have been
customer property, may be avoided by the trustee, and such property
shall be treated as customer property, if and to the extent that the
trustee avoids such transfer under section 544, 545, 547, 548, 549, or
724(a) of this title. For the purpose of such sections, the property so
transferred shall be deemed to have been property of the debtor, and, if
such transfer was made to a customer or for a customer's benefit, such
customer shall be deemed, for the purposes of this section, to have been
(b) Notwithstanding sections 544, 545, 547, 548, 549, and 724(a) of
this title, the trustee may not avoid a transfer made before five days
after the order for relief, if such transfer is approved by the
Commission by rule or order, either before or after such transfer, and
if such transfer is--
(1) a transfer of a commodity contract entered into or carried
by or through the debtor on behalf of a customer, and of any cash,
securities, or other property margining or securing such commodity
(2) the liquidation of a commodity contract entered into or
carried by or through the debtor on behalf of a customer.
(Pub. L. 95-598, Nov. 6, 1978, 92 Stat. 2618; Pub. L. 97-222, Sec. 17,
July 27, 1982, 96 Stat. 240; Pub. L. 98-353, title III, Sec. 487, July
10, 1984, 98 Stat. 383.)
Historical and Revision Notes
Section 764 of the House amendment is derived from the House bill.
senate report no. 95-989
Section 764 permits the trustee to void any transfer of property
that, except for such transfer, would have been customer property, to
the extent permitted under section 544, 545, 547, 548, 549, or 724(a).
house report no. 95-595
Section 764 indicates the extent to which the avoiding powers may be
used by the trustee under subchapter IV of chapter 7. If property
recovered would have been customer property if never transferred, then
subsection (a) indicates that it will be so treated when recovered.
Subsection (b) prohibits avoiding any transaction that occurs before
or within five days after the petition if the transaction is approved by
the Commission and concerns an open contractual commitment. This enables
the Commission to exercise its discretion to protect the integrity of
the market by insuring that transactions cleared with other brokers will
not be undone on a preference or a fraudulent transfer theory.
Subsection (c) insulates variation margin payments and other
deposits from the avoiding powers except to the extent of actual fraud
under section 548(a)(1). This facilitates prepetition transfers and
protects the ordinary course of business in the market.
1984--Subsec. (a). Pub. L. 98-353 substituted ``any transfer by the
debtor'' for ``any transfer''.
1982--Subsec. (a). Pub. L. 97-222, Sec. 17(a), substituted ``but''
for ``except'', inserted ``such property'' after ``trustee, and'', and
substituted ``shall be'' for ``is'' wherever appearing.
Subsec. (b). Pub. L. 97-222, Sec. 17(b), substituted ``order for
relief'' for ``date of the filing of the petition''.
Subsec. (c). Pub. L. 97-222, Sec. 17(c), struck out subsec. (c)
which provided that the trustee could not avoid a transfer that was a
margin payment to or deposit with a commodity broker or forward contract
merchant or was a settlement payment made by a clearing organization and
that occurred before the commencement of the case.
Effective Date of 1984 Amendment
Amendment by Pub. L. 98-353 effective with respect to cases filed 90
days after July 10, 1984, see section 552(a) of Pub. L. 98-353, set out
as a note under section 101 of this title.
Section Referred to in Other Sections
This section is referred to in section 106 of this title.