80 FR 21153 - Submission of Credit Card Agreements Under the Truth in Lending Act (Regulation Z)
BUREAU OF CONSUMER FINANCIAL PROTECTION Federal Register Volume 80, Issue 74 (April 17, 2015)
Federal Register Volume 80, Issue 74 (April 17, 2015)
| Page Range | 21153-21158 | |
| FR Document | 2015-09000 |
[Federal Register Volume 80, Number 74 (Friday, April 17, 2015)] [Rules and Regulations] [Pages 21153-21158] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-09000] ======================================================================= ----------------------------------------------------------------------- BUREAU OF CONSUMER FINANCIAL PROTECTION 12 CFR Part 1026 [Docket No. CFPB-2015-0006] RIN 3170-AA50 Submission of Credit Card Agreements Under the Truth in Lending Act (Regulation Z) AGENCY: Bureau of Consumer Financial Protection. ACTION: Final rule. ----------------------------------------------------------------------- SUMMARY: The Bureau of Consumer Financial Protection (Bureau) is amending Regulation Z, which implements the Truth in Lending Act, and the official interpretation to that regulation, to temporarily suspend card issuers' obligations to submit credit card agreements to the Bureau for a period of one year (i.e., four quarterly submissions), in order to reduce burden while the Bureau works to develop a more streamlined and automated electronic submission system. Other requirements, including card issuers' obligations to post currently- offered agreements on their own Web sites, remain unaffected. DATES: This final rule is effective on April 17, 2015. FOR FURTHER INFORMATION CONTACT: Thomas L. Devlin, Counsel, or Kristine M. Andreassen, Senior Counsel, Office of Regulations, at (202) 435- 7700. SUPPLEMENTARY INFORMATION: I. Summary of the Rule The Truth in Lending Act (TILA), in section 122(d), requires creditors to post agreements for open-end consumer credit card plans on the creditors' Web sites and to submit those agreements to the Bureau. 15 U.S.C. 1632(d). These provisions are implemented in Sec. 1026.58 of Regulation Z.\1\ 12 CFR 1026.58. The Bureau is finalizing amendments that it proposed in February 2015 \2\ to suspend temporarily the requirement in Sec. 1026.58(c) that card issuers submit credit card agreements to the Bureau for a period of one year (i.e., four quarterly submissions), in order to reduce burden while the Bureau works to develop a more streamlined and automated electronic submission system. Specifically, the Bureau is suspending the submissions that would otherwise have been due to the Bureau by the first business day on or after April 30, 2015; July 31, 2015; October 31, 2015; and January 31, 2016. Beginning with the submission due on the first business day on or after April 30, 2016, card issuers shall resume submitting credit card agreements on a quarterly basis to the Bureau. The Bureau expects to consult with interested stakeholders before that date regarding resumption of the submission requirements and technical specifications for the new system. Other requirements under Sec. 1026.58, including card issuers' obligations to post currently-offered agreements on their own Web sites under Sec. 1026.58(d), remain unaffected. --------------------------------------------------------------------------- \1\ Section 1026.58 uses the terms card issuer (or issuer) and credit card agreement (or agreement) in lieu of the terms creditor and open-end consumer credit card plan, respectively, that are used in section 122(d) of TILA. \2\ 80 FR 10417 (Feb. 26, 2015). --------------------------------------------------------------------------- II. Background A. The Statute and Regulation In 2009, Congress enhanced protections for credit cards in the Credit Card Accountability Responsibility and Disclosure Act (CARD Act), which it enacted to ``establish fair and transparent practices related to the extension of credit'' in the credit card market.\3\ The Board of Governors of the Federal Reserve System (Board) generally implemented the CARD Act's provisions in subpart G of Regulation Z. Section 204 of the CARD Act added new TILA section 122(d) to require creditors to post agreements for open-end consumer credit card plans on the [[Page 21154]] creditors' Web sites and to submit those agreements to the Board for posting on a publicly available Web site established and maintained by the Board. 15 U.S.C. 1632(d). --------------------------------------------------------------------------- \3\ Public Law 111-24, 123 Stat. 1734 (2009). --------------------------------------------------------------------------- Specifically, TILA section 122(d)(1) requires each creditor to post its credit card agreements on its own Web site, and section 122(d)(2) requires the creditor to provide its agreements to the Bureau (formerly the Board). TILA section 122(d)(3) requires the Bureau (formerly the Board) to establish and maintain on its publicly available Web site a central repository of the agreements it receives under section 122(d)(2). The Board implemented these provisions in 12 CFR 226.58. With the adoption of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), authority to implement TILA transferred to the Bureau \4\ and the Bureau renumbered this provision in Regulation Z as Sec. 1026.58.\5\ --------------------------------------------------------------------------- \4\ Public Law 111-203, section 1100A, 124 Stat. 2081 (2010) (codified at 15 U.S.C. 1602 et seq.). \5\ 76 FR 79768 (Dec. 22, 2011). --------------------------------------------------------------------------- While TILA section 122(d) requires that creditors provide agreements to the Bureau, it does not specify the frequency or timing for these submissions. The implementing regulations in Regulation Z provide that submission of currently-offered agreements must be made quarterly. See Sec. 1026.58(c)(1). These quarterly submissions must be sent to the Bureau no later than the first business day on or after January 31, April 30, July 31, and October 31 of each year. The regulation also provides that, except in certain circumstances, card issuers must post and maintain on their publicly available Web sites the credit card agreements that the issuers are required to submit to the Bureau. See Sec. 1026.58(d). Under the current process, which has been used by the Bureau since its inception, card issuers submit agreements and agreement information to the Bureau manually via email. The Bureau believes this process may be unnecessarily cumbersome for issuers and may make issuers' own internal tracking of previously submitted agreements difficult. In addition, the current process for Bureau staff to manually review, catalog, and upload new or revised agreements to the Bureau's Web site, and to remove outdated agreements, can extend for several months after the quarterly submission deadline.\6\ The Bureau is working to develop a more streamlined and automated electronic submission system which would allow issuers to upload agreements directly to the Bureau's database. The Bureau intends for its new submission system to be less burdensome and easier for issuers to use. It also intends for the new system to enable faster posting of new and revised agreements on the Bureau's Web site. --------------------------------------------------------------------------- \6\ The Bureau's database of credit card agreements is available at http://www.consumerfinance.gov/credit-cards/agreements/. --------------------------------------------------------------------------- In order to reduce the burden on card issuers of continuing to use manual submission methods while the Bureau works to design, test, and implement a more streamlined and automated electronic submission system, the Bureau is temporarily suspending issuers' obligations to submit credit card agreements to the Bureau for a period of one year (i.e., four quarterly submissions), as described in more detail in the section-by-section analysis below. Issuers' obligations to post currently-offered agreements on their own Web sites are unaffected. The Bureau recognizes that its temporary suspension of the requirement that card issuers submit credit card agreements to the Bureau will temporarily reduce the access consumers, other external parties, and the Bureau itself have to a single repository of the agreements that would have been submitted during this one-year period. However, the Bureau expects that this temporary reduction will not impose significant costs on consumers, other external parties, or the Bureau itself for at least two key reasons. First, the Bureau is not modifying the requirement that card issuers post currently-offered agreements on their own Web sites in a manner that is prominent and readily accessible by the public (Sec. 1026.58(d)) or that card issuers make all open agreements available on their Web sites or to cardholders upon request (Sec. 1026.58(e)). Second, the Bureau intends to manually compile credit card agreements from certain large card issuers' Web sites as of approximately September 2015. Given the longstanding concentration in the credit card market, the Bureau believes that uploading agreements obtained from a relatively small number of issuers' Web sites to the Bureau's own Web site is sufficient to provide the agreement terms available to the overwhelming majority of credit card consumers in the U.S. as of the mid-point of the proposed suspension period.\7\ This will allow consumers to continue to use the Bureau's Web site to effectively compare agreements offered by various issuers. --------------------------------------------------------------------------- \7\ See, e.g., CFPB, CARD Act Report, at 13-14 (Oct. 1, 2013), available at http://files.consumerfinance.gov/f/201309_cfpb_card-act-report.pdf. --------------------------------------------------------------------------- Overall, the Bureau expects that the marginal costs to consumers and other external parties from interrupted access during the suspension period are outweighed by the anticipated benefits of increased usability of the agreements and expedited availability of agreements on the Bureau's Web site after the Bureau implements a more streamlined and automated submission system. The Bureau intends to explore potential functionality for the new system that would improve external parties' ability to use the information efficiently and effectively, such as through improved reporting capabilities. In addition, by streamlining the submission process, the Bureau intends for the new system to also reduce burden on card issuers. B. Comments on the Proposed Rule On February 26, 2015, the Bureau proposed to amend Sec. 1026.58, the Regulation Z provision on internet availability of credit card agreements, to temporarily suspend the requirement in Sec. 1026.58(c) that card issuers submit credit card agreements to the Bureau for a period of one year (i.e., four quarterly submissions), in order to reduce burden while the Bureau works to develop a more streamlined and automated electronic submission system. The comment period closed on March 13, 2015. In response to the proposal, the Bureau received seven comments from financial institutions, credit union trade associations, and others. The Bureau discusses relevant comments in the section-by- section analysis below. Several commenters also urged the Bureau to take other actions beyond the scope of the proposal. III. Legal Authority The Bureau is issuing this final rule pursuant to its authority under TILA sections 105(a) and 122(d)(5). TILA section 105(a) authorizes the Bureau to prescribe regulations to carry out the purposes of TILA. These regulations may contain such classifications, differentiations, or other provisions, and may provide for such adjustments and exceptions for any class of transactions, that in the Bureau's judgment are necessary or proper to effectuate the purposes of TILA, facilitate compliance with TILA, or prevent circumvention or evasion of TILA. TILA section 122(d)(5) authorizes the Bureau to promulgate regulations to implement section 122(d), including, among other things, establishing exceptions to TILA sections 122(d)(1) and (2) in any case where the [[Page 21155]] administrative burden outweighs the benefits of increased transparency. The Bureau is exercising its rulemaking authority pursuant to TILA sections 105(a) and 122(d)(5) to, in effect, change the period for creditors' submission of agreements to the Bureau from quarterly to annually, for a period of one year. The Bureau is also exercising its exception authority under TILA sections 105(a) and 122(d)(5) to temporarily suspend the agreement submission requirements in Sec. 1026.58(c), as it concludes that the burden to issuers of continuing to submit agreements under the current cumbersome, manual process while the Bureau works to develop a more streamlined and automated electronic submission system outweighs the benefits of transparency to consumers and other external parties of access to those agreements via the Bureau's Web site during the suspension period. Further, the Bureau believes that a temporary suspension will effectuate the purposes of TILA and facilitate compliance therewith. IV. Section-by-Section Analysis Regulation Z Subpart G--Special Rules Applicable to Credit Card Accounts and Open- End Credit Offered to College Students Section 1026.58 Internet Posting of Credit Card Agreements 58(g) Temporary Suspension of Agreement Submission Requirement Proposed Rule As discussed above, Sec. 1026.58 describes how card issuers must comply with the provisions of TILA, as amended by the CARD Act, that require creditors to post agreements for open-end consumer credit card plans on the creditors' Web sites and to submit those agreements to the Bureau. Specifically, Sec. 1026.58(c) governs submission of agreements to the Bureau, Sec. 1026.58(d) governs the requirement that issuers post currently-offered agreements on the issuers' own Web sites, and Sec. 1026.58(e) governs the requirement that issuers make cardholder agreements for currently open accounts available to cardholders. In the proposed rule, the Bureau proposed to add Sec. 1026.58(g) to Sec. 1026.58. The Bureau proposed, in Sec. 1026.58(g)(1), to temporarily suspend the quarterly credit card agreement submission requirement in Sec. 1026.58(c) for submissions that would otherwise be due to the Bureau by the first business day on or after April 30, 2015; July 31, 2015; October 31, 2015; and January 31, 2016. The Bureau proposed to add comments 58(g)-1 and -2 to further clarify the terms of the suspension, and to explain in more detail what issuers must include in their submissions due on the first business day on or after April 30, 2016. Section 1026.58(d) requires a card issuer to post and maintain on its publicly available Web site the credit card agreements that the issuer is required to submit to the Bureau under Sec. 1026.58(c). The Bureau proposed Sec. 1026.58(g)(2) to provide that the suspended submission requirement in proposed Sec. 1026.58(g)(1) would not affect card issuers' obligations to post agreements on their own Web sites as required by Sec. 1026.58(d) during the temporary suspension period. The Bureau proposed comment 58(g)-3 to further explain this provision and provide several examples. Comments The Bureau solicited comment on its proposal to temporarily suspend the obligation card issuers would otherwise have had under Sec. 1026.58(c) to submit credit card agreements to the Bureau for the four quarterly submissions that would otherwise be due to the Bureau by the first business day on or after April 30, 2015; July 31, 2015; October 31, 2015; and January 31, 2016. Commenters generally supported the proposed rule, and no commenter opposed the proposed temporary suspension. All of the trade association commenters stated that they found the current manual submission system for credit card agreements to be cumbersome. Those same commenters, along with others, agreed that issuers' continuing obligation to post currently-offered credit card agreements on their Web sites would ensure that most interested consumers could access available credit card agreements. Trade association commenters urged that the Bureau should consult with financial institutions before finalizing new technical specifications for the submission of credit card agreements, including one commenter who supported releasing those specifications through the notice-and-comment process. The Bureau did not solicit comment regarding the technical specifications that will be associated with a new submission system; nonetheless, the Bureau expects to consult with financial institutions, trade associations, or both to test and refine the system before using it with industry generally. The Bureau does not anticipate soliciting comment regarding the technical specifications that will be associated with a new submission system. A commenter from an academic public policy center suggested that, rather than temporarily suspending the submission requirement for a period of one year, the Bureau should remove the submission requirement entirely.\8\ --------------------------------------------------------------------------- \8\ As noted above, the submission requirement was mandated by Congress's amendments to TILA in the CARD Act. --------------------------------------------------------------------------- One commenter addressed an option that the Bureau considered but ultimately did not propose, under which credit card issuers would be required, at the end of the one-year suspension period, to submit all agreements that they would have been required to submit during the suspension period. That commenter argued that the burden imposed by such a requirement would not be justified by the limited benefit resulting from a more complete database of agreements. Final Rule The Bureau is adopting Sec. 1026.58(g), and the proposed commentary to that section, as proposed. As noted above, none of the comments received opposed the one-year temporary suspension, and most supported the Bureau's efforts to develop a more streamlined and efficient electronic submission system for credit card agreements. None of the comments discussed the specific language of the proposed regulatory text or commentary. After reviewing the comments received in response to the proposal, the Bureau believes that a one-year suspension represents the best balance between fulfilling the Congressional mandate in TILA section 122(d) and easing the compliance burden on credit card issuers arising from the manual submission system inherited by the Bureau while the Bureau works to develop a more streamlined and automated electronic submission system. V. Effective Date The Bureau proposed to make its temporary suspension of Sec. 1026.58(c) effective immediately after publication of this final rule in the Federal Register. The Bureau sought comment on the proposed effective date, including on whether a later effective date would be more appropriate. None of the comments received by the Bureau explicitly addressed the proposed effective date. An agency must allow 30 days before a substantive rule is made effective, unless, among other things, the rule ``grants or recognizes an exemption or relieves a restriction'' \9\ or ``as otherwise provided by the agency for good cause [[Page 21156]] found and published with the rule.'' \10\ The Bureau believes that this rule recognizes an exemption from or relieves a restriction on issuers' obligations to submit credit card agreements to the Bureau, and does not create any new requirement. Accordingly, the 30-day delay in effective date does not apply and the Bureau finds good cause to make this rule effective immediately upon publication in the Federal Register, in order to reduce burden while the Bureau works to develop a more streamlined and automated electronic submission system for credit card agreements. --------------------------------------------------------------------------- \9\ 5 U.S.C. 553(d)(1). \10\ 5 U.S.C. 553(d)(3). --------------------------------------------------------------------------- VI. Section 1022(b)(2) of the Dodd-Frank Act A. Overview In developing this rule, the Bureau has considered potential benefits, costs, and impacts.\11\ The Bureau has consulted, or offered to consult with, the prudential regulators, the Department of the Treasury, and the Federal Trade Commission, including regarding consistency with any prudential, market, or systemic objectives administered by such agencies. --------------------------------------------------------------------------- \11\ Specifically, section 1022(b)(2)(A) of the Dodd-Frank Act calls for the Bureau to consider the potential benefits and costs of a regulation to consumers and covered persons, including the potential reduction of access by consumers to consumer financial products or services; the impact on depository institutions and credit unions with $10 billion or less in total assets as described in section 1026 of the Dodd-Frank Act; and the impact on consumers in rural areas. --------------------------------------------------------------------------- Pursuant to TILA section 122(d)(3), the Bureau maintains on its public Web site a repository of the consumer credit card agreements that card issuers submit pursuant to TILA section 122(d)(2), as implemented in Sec. 1026.58(c). The electronic folders in the repository are organized by quarter, back to the third quarter of 2011, reflecting the transfer of authority to implement TILA from the Board to the Bureau pursuant to the Dodd-Frank Act. For each quarter, the repository contains a copy of each agreement, in PDF format, that was available to consumers as of the end of that quarter. The repository also contains, for each quarter, a spreadsheet that provides certain identifying information about each agreement and the issuer thereof. The Bureau proposed to amend Sec. 1026.58(g) to temporarily suspend the requirement in Sec. 1026.58(c) for card issuers to submit credit card agreements to the Bureau. The Bureau is finalizing the amendments to Sec. 1026.58(g) as proposed. Card issuers will not be required to make quarterly submissions to the Bureau for the submissions that would otherwise be due by the first business day on or after April 30, 2015; July 31, 2015; October 31, 2015; and January 31, 2016. Consequently, the Bureau will not provide these agreements on its Web site. As discussed previously, however, the Bureau intends to manually compile credit card agreements from certain large card issuer Web sites as of approximately September 2015 and post those agreements on its Web site. Card issuers will resume submitting agreements on a quarterly basis to the Bureau beginning with the submission due by the first business day on or after April 30, 2016. The Bureau is not modifying the requirement that card issuers post currently-offered agreements on their own Web sites in a manner that is prominent and readily accessible by the public (Sec. 1026.58(d)) or that card issuers make all open agreements available on their Web sites or to cardholders upon request (Sec. 1026.58(e)). B. Potential Benefits and Costs to Consumers and Covered Persons The Bureau is not aware of any significant costs to consumers that might arise from the temporary suspension of the quarterly submission requirement and the absence of these agreements on the Bureau's Web site. While the Bureau's Web site can assist consumers in comparing credit card agreements when shopping for a new card, the Bureau believes that most consumers are not likely to use the repository to identify desirable credit cards, in part because they would not know if they qualified for the cards they identified. The Bureau believes that consumers are more likely to identify a number of cards for which they qualify before comparing the terms and conditions for those cards. These terms and conditions will remain readily available to consumers on the issuers' Web sites. Similarly, a consumer who wanted to replace a lost agreement would likely find it easier to contact the issuer than to search the repository because the agreement might no longer be available to new cardholders, in which case the consumer would need to search across multiple quarters to find the agreement, and even then might lack confidence that she had found the version of the agreement that applied to her. On the other hand, the Bureau recognizes that consumers who would qualify for almost any card on the market and who want to learn about the features of a large number of products might find the repository useful. The final rule might increase the cost to these consumers of searching for desirable credit cards. The Bureau believes that this cost would be small, however, given that the Bureau is suspending the submission requirement for just four quarters. In addition, as discussed in more detail below, the Bureau will manually collect agreements from certain large issuers' Web sites at the midpoint of the suspension period, which will mitigate this cost to consumers. The Bureau requested comment on this point but did not receive any responses. Similarly, the Bureau recognizes the possibility that entities may use the information in the repository to develop more competitive products or extract information that they could sell or otherwise provide to consumers or third parties. However, the Bureau believes that this is unlikely given that the agreements, while generally in searchable PDF format, do not contain uniform data or text fields that would provide the same type of information in fixed locations across files. The Bureau requested comment on this point as well but did not receive any responses. A commenter from an academic public policy center noted that the information that these entities need would remain on the issuers' Web sites. The Bureau believes that the final rule will provide issuers with a minor but tangible benefit. For the third quarter of 2014, 446 issuers had 1,833 agreements in the Bureau's database. While 169 issuers had just one agreement, the median number of agreements per issuer was two and the average was four. Four issuers had over 50 agreements. In the third quarter alone, 103 issuers submitted 429 agreements; the median and mean were again two and four, respectively. Three issuers submitted over 25 agreements. All issuers will be able to suspend their submissions for four quarters, which will remove some compliance burden. The Bureau believes that the burden is small on average, although it may be higher for the entities that provide a large number of agreements.\12\ The Bureau requested [[Page 21157]] comment on this point but did not receive any responses. --------------------------------------------------------------------------- \12\ The Bureau notes that card issuers who submit a smaller number of agreements to the Bureau, but that only submit new and amended agreements and notice of withdrawn agreements, may have higher compliance costs than issuers who resubmit each quarter all agreements that are currently available to consumers. Thus, using the number of agreements submitted each quarter does not strictly track compliance cost. However, the Bureau expects that the number of agreements submitted and compliance cost are correlated even for those who submit all available agreements each quarter because they still have to ensure they are not sending agreements that are no longer offered to new customers or are entirely defunct. --------------------------------------------------------------------------- As noted above, the Bureau recognizes the possibility that entities could use the information in the repository to develop more competitive products or extract information that they could sell or otherwise provide to consumers or third parties. However, as mentioned above, the Bureau believes that this is unlikely given the difficulties in using files in PDF format for this purpose. To the extent that entities are inclined to use the files in the repository to extract information, the Bureau believes that manual collection of the credit card agreements from certain large card issuer Web sites as of approximately September 2015 and posting those agreements on the Bureau Web site will mitigate the impact of the proposed rule on these entities. A commenter from an academic public policy center argued that the submission and record repository requirements in TILA sections 122(d)(2)-(3), implemented in Sec. 1026.58(c), impose costs without evidence of benefits (and most likely with few benefits). This commenter recommended that the Bureau suspend the submission requirement permanently instead of temporarily. The commenter did not, however, dispute the Bureau's consideration of the benefits and costs of Sec. 1026.58(g) relative to the baseline defined by the current statute and implementing regulation. More generally, the Bureau seeks through this rulemaking and the associated development of a more streamlined and automated electronic submission system to increase the benefits and reduce the costs of the submission and repository requirements, and is not considering other changes at this time. As an alternative, the Bureau considered coupling the temporary suspension with a requirement to provide the Bureau, after the suspension expired, with the agreements that they would have been required to submit if not for the suspension. Compared to the final rule, this alternative would have imposed smaller costs on consumers and provided smaller benefits to issuers. Since the costs to consumers under the final rule are small to begin with, the Bureau believes that the final rule is superior to the alternative. A commenter from an academic public policy center opposed this alternative, arguing that the additional compliance costs associated with requiring issuers to collect and submit the additional agreement was not justified by the marginal benefit to consumers. C. Impact on Covered Persons With No More Than $10 Billion in Assets The majority of banks and credit unions that provide agreements under Sec. 1026.58(c) have no more than $10 billion in assets. Thus, the majority of banks and credit unions that will benefit from the final rule have no more than $10 billion in assets. On the other hand, larger banks and credit unions generally provide the Bureau with more agreements each quarter. Thus, the final rule will generally provide larger banks and credit unions with a greater reduction in burden compared to that obtained by banks and credit unions with no more than $10 billion in assets. One trade association commenter noted the discussion of these effects in the proposal and urged the Bureau to consider the implementation and ongoing costs associated with the new process. As explained in the Background section of the proposed rule, the Bureau intends for its new submission system to be less burdensome and easier for issuers to use. Thus, the Bureau intends the new system to reduce ongoing costs to covered persons relative to the baseline. The Bureau expects that any one-time transition cost will be small and quickly recovered through lower ongoing costs. D. Impact on Access to Credit The Bureau does not believe that there will be an adverse impact on access to credit, or any other consumer financial products or services, resulting from the final rule. The final rule imposes no direct requirements on consumer financial products or services or providers of consumer financial products or services or on the eligibility of consumers for consumer financial products or services. As discussed above, the final rule imposes at most a minor additional cost on certain consumers searching for a credit card. As noted above, the Bureau recognizes the possibility that entities could use the information in the repository to develop more competitive products or extract information that they could sell or otherwise provide to consumers or third parties. However, the Bureau believes that this is unlikely given the difficulties in using files in PDF format for this purpose and the fact that the suspension would last for just four quarters. Thus, the final rule should not inhibit activities that would improve access to credit such as the development of more competitive credit products or products that would reduce search costs. E. Impact on Consumers in Rural Areas The Bureau does not believe that the final rule will have a unique impact on consumers in rural areas. VII. Regulatory Flexibility Analysis The Regulatory Flexibility Act (RFA), as amended by the Small Business Regulatory Enforcement Fairness Act of 1996, requires each agency to consider the potential impact of its regulations on small entities, including small businesses, small governmental units, and small nonprofit organizations. The RFA defines a ``small business'' as a business that meets the size standard developed by the Small Business Administration pursuant to the Small Business Act. The RFA generally requires an agency to conduct an initial regulatory flexibility analysis (IRFA) and a final regulatory flexibility analysis (FRFA) of any rule subject to notice-and-comment rulemaking requirements, unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. The Bureau also is subject to certain additional procedures under the RFA involving the convening of a panel to consult with small business representatives prior to proposing a rule for which an IRFA is required. Neither an IRFA nor a FRFA is required for this rule because it will not have a significant economic impact on a substantial number of small entities. The Bureau does not expect the rule to impose costs on small entities. As discussed above, the Bureau believes that the rule will cause a small reduction in costs on all issuers, including small entity issuers, who would otherwise be required to submit agreements to the Bureau. Accordingly, the undersigned certifies that the final rule will not have a significant economic impact on a substantial number of small entities. VIII. Paperwork Reduction Act Analysis Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501 et seq.), Federal agencies are generally required to seek the Office of Management and Budget (OMB) approval for information collection requirements prior to implementation. This final rule will amend Regulation Z, 12 CFR part 1026. The collections of information affected by this final rule have been previously reviewed and approved by OMB in accordance with the PRA and assigned OMB Control Number 3170-0052. Under the PRA, the Bureau may not conduct or sponsor and, [[Page 21158]] notwithstanding any other provision of law, a person is not required to respond to an information collection unless the information collection displays a valid control number assigned by OMB. The Bureau has determined that this final rule will not impose any new recordkeeping, reporting, or disclosure requirements on covered entities or members of the public that would constitute collections of information requiring approval under the PRA. List of Subjects in 12 CFR Part 1026 Advertising, Consumer protection, Credit, Credit unions, Mortgages, National banks, Reporting and recordkeeping requirements, Savings associations, Truth in lending. Authority and Issuance For the reasons set forth in the preamble, the Bureau amends 12 CFR part 1026, as follows: PART 1026--TRUTH IN LENDING (REGULATION Z) 0 1. The authority citation for part 1026 continues to read as follows: Authority: 12 U.S.C. 2601, 2603-2605, 2607, 2609, 2617, 5511, 5512, 5532, 5581; 15 U.S.C. 1601 et seq. Subpart G--Special Rules Applicable to Credit Card Accounts and Open-End Credit Offered to College Students 0 2. Section 1026.58 is amended by adding paragraph (g) to read as follows: Sec. 1026.58 Internet posting of credit card agreements. * * * * * (g) Temporary suspension of agreement submission requirement--(1) Quarterly submissions. The quarterly submission requirement in paragraph (c) of this section is suspended for the submissions that would otherwise be due to the Bureau by the first business day on or after April 30, 2015; July 31, 2015; October 31, 2015; and January 31, 2016. (2) Posting of agreements offered to the public. Nothing in paragraph (g)(1) of this section shall affect the agreement posting requirements in paragraph (d) of this section. 0 3. In Supplement I to Part 1026, under Section 1026.58--Internet Posting of Credit Card Agreements, add 58(g) Temporary Suspension of Agreement Submission Requirement to read as follows: Supplement I to Part 1026--Official Interpretations * * * * * Section 1026.58--Internet Posting of Credit Card Agreements * * * * * 58(g) Temporary Suspension of Agreement Submission Requirement 1. Suspended quarterly submission requirement. Pursuant to Sec. 1026.58(g)(1), card issuers are not required to make quarterly submissions to the Bureau, as otherwise required by Sec. 1026.58(c), for the submissions that would otherwise be due by the first business day on or after April 30, 2015; July 31, 2015; October 31, 2015; and January 31, 2016. Specifically, a card issuer is not required to submit information about the issuer and its agreements pursuant to Sec. 1026.58(c)(1)(i), new credit card agreements pursuant to Sec. 1026.58(c)(1)(ii), amended agreements pursuant to Sec. 1026.58(c)(1)(iii) and (c)(3), or notification of withdrawn agreements pursuant to Sec. 1026.58(c)(1)(iv) and (c)(4) through (7) for those four quarters. 2. Resuming submission of credit card agreements to the Bureau. Beginning with the submission due on the first business day on or after April 30, 2016, card issuers shall resume submitting credit card agreements on a quarterly basis to the Bureau pursuant to Sec. 1026.58(c). A card issuer shall submit agreements for the prior calendar quarter (that is, the calendar quarter ending March 31, 2016), as specified in Sec. 1026.58(c)(1)(ii) through (iv) and (c)(3) through (7), to the Bureau no later than the first business day on or after April 30, 2016. i. Specifically, the submission due on the first business day on or after April 30, 2016 shall contain, as applicable: A. Identifying information about the card issuer and the agreements submitted, including the issuer's name, address, and identifying number (such as an RSSD ID number or tax identification number), pursuant to Sec. 1026.58(c)(1)(i); B. The credit card agreements that the card issuer offered to the public as of the last business day of the calendar quarter ending March 31, 2016 that the card issuer had not previously submitted to the Bureau as of the first business day on or after January 31, 2015, pursuant to Sec. 1026.58(c)(1)(ii); C. Any credit card agreement previously submitted to the Bureau that was amended since the last business day of the calendar quarter ending December 31, 2014 and that the card issuer offered to the public as of the last business day of the calendar quarter ending March 31, 2016, pursuant to Sec. 1026.58(c)(1)(iii) and (c)(3); and D. Notification regarding any credit card agreement previously submitted to the Bureau that the issuer is withdrawing, pursuant to Sec. 1026.58(c)(1)(iv) and (c)(4) through (7). ii. In lieu of the submission described in comment 58(g)-2.i.B through D, Sec. 1026.58(c)(1) permits a card issuer to submit to the Bureau a complete, updated set of the credit card agreements the card issuer offered to the public as of the calendar quarter ending March 31, 2016. See comment 58(c)(1)-3. 3. Continuing obligation to post agreements on a card issuer's own Web site. Section 1026.58(d) requires a card issuer to post and maintain on its publicly available Web site the credit card agreements that the issuer is required to submit to the Bureau under Sec. 1026.58(c). Pursuant to Sec. 1026.58(g)(2), during the temporary suspension period set forth in Sec. 1026.58(g)(1), a card issuer shall continue to post its agreements to its own publicly available Web site as required by Sec. 1026.58(d) using the agreements it would have otherwise submitted to the Bureau under Sec. 1026.58(c). For example, for purposes of Sec. 1026.58(d)(4), a card issuer must continue to update the agreements posted on its own Web site at least as frequently as the quarterly schedule required for submission of agreements to the Bureau set forth in Sec. 1026.58(c)(1), notwithstanding the temporary suspension of submission requirements in Sec. 1026.58(g)(1). Similarly, for purposes of Sec. 1026.58(d)(2), agreements posted by a card issuer on its own Web site must continue to conform to the form and content requirements set forth in Sec. 1026.58(c)(8). * * * * * Dated: April 13, 2015. Richard Cordray, Director, Bureau of Consumer Financial Protection. [FR Doc. 2015-09000 Filed 4-15-15; 4:15 pm] BILLING CODE 4810-AM-P
![21153
Rules and Regulations Federal Register
Vol. 80, No. 74
Friday, April 17, 2015
This section of the FEDERAL REGISTER PART 1201—PRACTICES AND agreements for open-end consumer
contains regulatory documents having general PROCEDURES credit card plans on the creditors’ Web
applicability and legal effect, most of which sites and to submit those agreements to
are keyed to and codified in the Code of ■ 1. The authority citation for 5 CFR the Bureau. 15 U.S.C. 1632(d). These
Federal Regulations, which is published under part 1201 continues to read as follows: provisions are implemented in
50 titles pursuant to 44 U.S.C. 1510.
Authority: 5 U.S.C. 1204, 1305, and 7701, § 1026.58 of Regulation Z.1 12 CFR
The Code of Federal Regulations is sold by and 38 U.S.C. 4331, unless otherwise noted. 1026.58. The Bureau is finalizing
the Superintendent of Documents. Prices of amendments that it proposed in
new books are listed in the first FEDERAL § 1201.183 [Amended] February 2015 2 to suspend temporarily
REGISTER issue of each week. the requirement in § 1026.58(c) that card
■ 2. Amend § 1201.183 by removing issuers submit credit card agreements to
paragraph (c)(3). the Bureau for a period of one year (i.e.,
MERIT SYSTEMS PROTECTION William D. Spencer, four quarterly submissions), in order to
BOARD Clerk of the Board. reduce burden while the Bureau works
[FR Doc. 2015–08880 Filed 4–16–15; 8:45 am] to develop a more streamlined and
5 CFR Part 1201 automated electronic submission
BILLING CODE 7400–01–P
system. Specifically, the Bureau is
Practices and Procedures suspending the submissions that would
AGENCY: Merit Systems Protection otherwise have been due to the Bureau
BUREAU OF CONSUMER FINANCIAL by the first business day on or after
Board. PROTECTION April 30, 2015; July 31, 2015; October
ACTION: Final rule. 31, 2015; and January 31, 2016.
12 CFR Part 1026
Beginning with the submission due on
SUMMARY: The Merit Systems Protection [Docket No. CFPB–2015–0006] the first business day on or after April
Board (MSPB or the Board) hereby 30, 2016, card issuers shall resume
amends its rules of practice and RIN 3170–AA50
submitting credit card agreements on a
procedure in order to correct a minor quarterly basis to the Bureau. The
drafting error in the Board’s regulations. Submission of Credit Card Agreements
Under the Truth in Lending Act Bureau expects to consult with
DATES: Effective April 17, 2015. (Regulation Z) interested stakeholders before that date
FOR FURTHER INFORMATION CONTACT: regarding resumption of the submission
AGENCY: Bureau of Consumer Financial requirements and technical
William D. Spencer, Clerk of the Board,
Protection. specifications for the new system. Other
Merit Systems Protection Board, 1615 M
Street NW., Washington, DC 20419; ACTION: Final rule. requirements under § 1026.58, including
phone: (202) 653–7200; fax: (202) 653– card issuers’ obligations to post
SUMMARY: The Bureau of Consumer currently-offered agreements on their
7130; or email: mspb@mspb.gov. Financial Protection (Bureau) is own Web sites under § 1026.58(d),
SUPPLEMENTARY INFORMATION: On amending Regulation Z, which remain unaffected.
October 12, 2012, the MSPB published implements the Truth in Lending Act,
a final rule that made numerous and the official interpretation to that II. Background
amendments to its regulations. 77 FR regulation, to temporarily suspend card A. The Statute and Regulation
62350. In making these amendments, issuers’ obligations to submit credit card
the MSPB inadvertently repeated the In 2009, Congress enhanced
agreements to the Bureau for a period of
language of 5 CFR 1201.183(c)(2) in 5 protections for credit cards in the Credit
one year (i.e., four quarterly
CFR 1201.183(c)(3). Accordingly, the Card Accountability Responsibility and
submissions), in order to reduce burden
Board now removes 5 CFR Disclosure Act (CARD Act), which it
while the Bureau works to develop a
1201.183(c)(3) as unnecessary and enacted to ‘‘establish fair and
more streamlined and automated
duplicative. transparent practices related to the
electronic submission system. Other
extension of credit’’ in the credit card
This amendment removing 5 CFR requirements, including card issuers’
market.3 The Board of Governors of the
1201.183(c)(3) corrects a minor drafting obligations to post currently-offered
agreements on their own Web sites, Federal Reserve System (Board)
error and makes no substantive change
remain unaffected. generally implemented the CARD Act’s
to the MSPB’s regulations. As a result,
provisions in subpart G of Regulation Z.
the Board finds good cause to forego DATES: This final rule is effective on Section 204 of the CARD Act added new
notice and comment rulemaking and to April 17, 2015. TILA section 122(d) to require creditors
make this final rule effective upon FOR FURTHER INFORMATION CONTACT: to post agreements for open-end
publication.
asabaliauskas on DSK5VPTVN1PROD with RULES
Thomas L. Devlin, Counsel, or Kristine consumer credit card plans on the
List of Subjects in 5 CFR Part 1201 M. Andreassen, Senior Counsel, Office
of Regulations, at (202) 435–7700. 1 Section 1026.58 uses the terms card issuer (or
Administrative practice and issuer) and credit card agreement (or agreement) in
SUPPLEMENTARY INFORMATION:
procedure. lieu of the terms creditor and open-end consumer
I. Summary of the Rule credit card plan, respectively, that are used in
Accordingly, for the reasons set forth section 122(d) of TILA.
in the preamble, the Board amends 5 The Truth in Lending Act (TILA), in 2 80 FR 10417 (Feb. 26, 2015).
CFR part 1201 as follows: section 122(d), requires creditors to post 3 Public Law 111–24, 123 Stat. 1734 (2009).
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![21158 Federal Register / Vol. 80, No. 74 / Friday, April 17, 2015 / Rules and Regulations
notwithstanding any other provision of Section 1026.58—Internet Posting of Credit maintain on its publicly available Web site
law, a person is not required to respond Card Agreements the credit card agreements that the issuer is
to an information collection unless the * * * * * required to submit to the Bureau under
§ 1026.58(c). Pursuant to § 1026.58(g)(2),
information collection displays a valid 58(g) Temporary Suspension of Agreement during the temporary suspension period set
control number assigned by OMB. The Submission Requirement forth in § 1026.58(g)(1), a card issuer shall
Bureau has determined that this final 1. Suspended quarterly submission continue to post its agreements to its own
rule will not impose any new requirement. Pursuant to § 1026.58(g)(1), card publicly available Web site as required by
recordkeeping, reporting, or disclosure issuers are not required to make quarterly § 1026.58(d) using the agreements it would
requirements on covered entities or submissions to the Bureau, as otherwise have otherwise submitted to the Bureau
members of the public that would required by § 1026.58(c), for the submissions under § 1026.58(c). For example, for
constitute collections of information that would otherwise be due by the first purposes of § 1026.58(d)(4), a card issuer
business day on or after April 30, 2015; July must continue to update the agreements
requiring approval under the PRA.
31, 2015; October 31, 2015; and January 31, posted on its own Web site at least as
List of Subjects in 12 CFR Part 1026 2016. Specifically, a card issuer is not frequently as the quarterly schedule required
required to submit information about the for submission of agreements to the Bureau
Advertising, Consumer protection, issuer and its agreements pursuant to set forth in § 1026.58(c)(1), notwithstanding
Credit, Credit unions, Mortgages, § 1026.58(c)(1)(i), new credit card agreements the temporary suspension of submission
National banks, Reporting and pursuant to § 1026.58(c)(1)(ii), amended requirements in § 1026.58(g)(1). Similarly, for
recordkeeping requirements, Savings agreements pursuant to § 1026.58(c)(1)(iii) purposes of § 1026.58(d)(2), agreements
associations, Truth in lending. and (c)(3), or notification of withdrawn posted by a card issuer on its own Web site
agreements pursuant to § 1026.58(c)(1)(iv) must continue to conform to the form and
Authority and Issuance and (c)(4) through (7) for those four quarters. content requirements set forth in
2. Resuming submission of credit card § 1026.58(c)(8).
For the reasons set forth in the agreements to the Bureau. Beginning with
preamble, the Bureau amends 12 CFR * * * * *
the submission due on the first business day
part 1026, as follows: on or after April 30, 2016, card issuers shall Dated: April 13, 2015.
resume submitting credit card agreements on Richard Cordray,
PART 1026—TRUTH IN LENDING a quarterly basis to the Bureau pursuant to Director, Bureau of Consumer Financial
(REGULATION Z) § 1026.58(c). A card issuer shall submit Protection.
agreements for the prior calendar quarter
[FR Doc. 2015–09000 Filed 4–15–15; 4:15 pm]
■ 1. The authority citation for part 1026 (that is, the calendar quarter ending March
continues to read as follows: 31, 2016), as specified in § 1026.58(c)(1)(ii) BILLING CODE 4810–AM–P
through (iv) and (c)(3) through (7), to the
Authority: 12 U.S.C. 2601, 2603–2605,
Bureau no later than the first business day on
2607, 2609, 2617, 5511, 5512, 5532, 5581; 15
or after April 30, 2016. DEPARTMENT OF TRANSPORTATION
U.S.C. 1601 et seq.
i. Specifically, the submission due on the
first business day on or after April 30, 2016 Federal Aviation Administration
Subpart G—Special Rules Applicable
shall contain, as applicable:
to Credit Card Accounts and Open-End A. Identifying information about the card
Credit Offered to College Students 14 CFR Parts 71 and 73
issuer and the agreements submitted,
including the issuer’s name, address, and [Docket No. FAA–2015–0924; Airspace
■ 2. Section 1026.58 is amended by identifying number (such as an RSSD ID Docket No. 15–AWA–2]
adding paragraph (g) to read as follows: number or tax identification number),
pursuant to § 1026.58(c)(1)(i); Amendment of Authority Citation for
§ 1026.58 Internet posting of credit card B. The credit card agreements that the card Part 71: Designation of Class A, B, C,
agreements. issuer offered to the public as of the last D, and E Airspace Areas; Air Traffic
* * * * * business day of the calendar quarter ending Service Routes; and Reporting Points,
(g) Temporary suspension of March 31, 2016 that the card issuer had not and Part 73: Special Use Airspace
agreement submission requirement—(1) previously submitted to the Bureau as of the
Quarterly submissions. The quarterly first business day on or after January 31, AGENCY: Federal Aviation
2015, pursuant to § 1026.58(c)(1)(ii); Administration (FAA), DOT.
submission requirement in paragraph (c)
C. Any credit card agreement previously
of this section is suspended for the ACTION: Final rule, technical
submitted to the Bureau that was amended
submissions that would otherwise be since the last business day of the calendar amendment.
due to the Bureau by the first business quarter ending December 31, 2014 and that SUMMARY: The FAA is amending the
day on or after April 30, 2015; July 31, the card issuer offered to the public as of the
authority citation for part 71 and part 73
2015; October 31, 2015; and January 31, last business day of the calendar quarter
ending March 31, 2016, pursuant to by adding an additional citation at the
2016.
§ 1026.58(c)(1)(iii) and (c)(3); and beginning of the authority citation
(2) Posting of agreements offered to
D. Notification regarding any credit card string. This action updates and clarifies
the public. Nothing in paragraph (g)(1)
agreement previously submitted to the the Administrator’s rulemaking
of this section shall affect the agreement Bureau that the issuer is withdrawing, authority to be consistent with other
posting requirements in paragraph (d) of pursuant to § 1026.58(c)(1)(iv) and (c)(4) parts of Title 14, Code of Federal
this section. through (7). Regulations.
■ 3. In Supplement I to Part 1026, under ii. In lieu of the submission described in
comment 58(g)–2.i.B through D, DATES: Effective 0901 UTC, April 17,
Section 1026.58—Internet Posting of
asabaliauskas on DSK5VPTVN1PROD with RULES
Credit Card Agreements, add 58(g) § 1026.58(c)(1) permits a card issuer to 2015.
submit to the Bureau a complete, updated set ADDRESSES: For 14 CFR part 71: FAA
Temporary Suspension of Agreement
of the credit card agreements the card issuer
Submission Requirement to read as Order 7400.9Y, Airspace Designations
offered to the public as of the calendar
follows: quarter ending March 31, 2016. See comment and Reporting Points and subsequent
58(c)(1)–3. amendments can be viewed online at
Supplement I to Part 1026—Official http://www.faa.gov/airtraffic/
3. Continuing obligation to post agreements
Interpretations publications/. FAA Order 7400.9,
on a card issuer’s own Web site. Section
* * * * * 1026.58(d) requires a card issuer to post and Airspace Designations and Reporting
VerDate Sep<11>2014 16:14 Apr 16, 2015 Jkt 235001 PO 00000 Frm 00006 Fmt 4700 Sfmt 4700 E:\FR\FM\17APR1.SGM 17APR1](https://thefederalregister.org/doc/80_FR_21227/page/6.svg)
Document Created: 2015-12-18 11:20:26
Document Modified: 2015-12-18 11:20:26
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Rules and Regulations | |
| Action | Final rule. | |
| Dates | This final rule is effective on April 17, 2015. | |
| Contact | Thomas L. Devlin, Counsel, or Kristine M. Andreassen, Senior Counsel, Office of Regulations, at (202) 435- 7700. | |
| FR Citation | 80 FR 21153 | |
| RIN Number | 3170-AA50 | |
| CFR Associated | Advertising; Consumer Protection; Credit; Credit Unions; Mortgages; National Banks; Reporting and Recordkeeping Requirements; Savings Associations and Truth in Lending |
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