So8 AGRICULTURAL ECONOMICS 



for cotton of grades above or below the basis grade in the settlement 

 of a contract of sale for the future delivery of cotton shall be deter- 

 mined by the actual commercial differences in value thereof on the 

 sixth business day prior to the day fixed .... for delivery of cotton 

 on the contract, established by the sale of spot cotton in the market 

 where the future transaction involved occurs and is consummated if 

 such market be a bona fide spot market [otherwise, the average of 

 five places that are spot markets, etc.]. 



SEC. 7. [Only those markets shall be considered bona fide spot 

 markets which the Secretary of Agriculture shall designate.] 



SEC. 8. [Secretary shall consider only such markets as handle 

 such volume and under such conditions as to reflect accurately the 

 value of middling cotton and the other official grades, etc.] 



SEC. 9. That the Secretary of Agriculture is authorized, from 

 time to time, to establish and promulgate standards of cotton [to be 

 known as the "Official Cotton Standards of the United States"]. 



SEC. 10. That no tax shall be levied under this Act on any con- 

 tract of sale mentioned in section three hereof, if the contract comply 

 with each of the following conditions: 



First. Conform to the rules and regulations made pursuant to 

 this Act. 



Second. Specify the grade, type, sample, or description of the 

 cotton involved in the contract, the price per pound at which such 

 cotton is contracted to be bought or sold, the date of the purchase or 

 sale, and the time when shipment or delivery of such cotton is to be 

 made. 



Third. Provide that cotton of or within the grade or of the type, 

 or according to the sample or description, specified hi the contract 

 shall be delivered thereunder, and that no cotton which does not con- 

 form to the type .... etc shall be tendered or delivered 



thereunder. 



Fourth. Provide that the delivery of cotton under the contract 

 shall not be effected by means of "set-off" or "ring" settlement, but 

 only by the actual transfer of the specified cotton mentioned in the 

 contract 



This Act shall not be construed to impose a tax on any sale of 

 spot cotton 



SEC. ii. That upon each order .... for the making of any 

 contract of sale of cotton grown in the United States for future delivery 

 .... in any exchange .... in any foreign country, there is hereby 



