80 FR 78959 - Extensions of Credit by Federal Reserve Banks
FEDERAL RESERVE SYSTEM Federal Register Volume 80, Issue 243 (December 18, 2015)
Federal Register Volume 80, Issue 243 (December 18, 2015)
| Page Range | 78959-78967 | |
| FR Document | 2015-30584 |
[Federal Register Volume 80, Number 243 (Friday, December 18, 2015)] [Rules and Regulations] [Pages 78959-78967] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-30584] ======================================================================== Rules and Regulations Federal Register ________________________________________________________________________ This section of the FEDERAL REGISTER contains regulatory documents having general applicability and legal effect, most of which are keyed to and codified in the Code of Federal Regulations, which is published under 50 titles pursuant to 44 U.S.C. 1510. The Code of Federal Regulations is sold by the Superintendent of Documents. Prices of new books are listed in the first FEDERAL REGISTER issue of each week. ======================================================================== Federal Register / Vol. 80, No. 243 / Friday, December 18, 2015 / Rules and Regulations [[Page 78959]] FEDERAL RESERVE SYSTEM 12 CFR Part 201 [Regulation A; Docket No. R-1476] RIN 7100-AE08 Extensions of Credit by Federal Reserve Banks AGENCY: Board of Governors of the Federal Reserve System. ACTION: Final rule. ----------------------------------------------------------------------- SUMMARY: The Board is adopting amendments to Regulation A (Extensions of Credit by Federal Reserve Banks) to implement the emergency lending authorities provided under the 3rd undesignated paragraph of section 13 of the Federal Reserve Act (the FRA) as amended by sections 1101 and 1103 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act). These provisions of the Dodd-Frank Act require the Board, in consultation with the Secretary of the Treasury, to establish by regulation policies and procedures with respect to emergency lending under section 13(3) of the FRA. DATES: Effective January 1, 2016. FOR FURTHER INFORMATION CONTACT: Laurie S. Schaffer, Associate General Counsel (202) 452-2272, Sophia H. Allison, Special Counsel (202) 452- 3565, or Jay R. Schwarz, Senior Counsel (202) 452-2970, Legal Division. Board of Governors of the Federal Reserve System, 20th Street and Constitution Ave. NW., Washington, DC 20551. For the hearing impaired only, Telecommunications Device for the Deaf (TDD) users may contact (202) 263-4869. SUPPLEMENTARY INFORMATION: I. Introduction On December 23, 2013, the Board invited public comment on proposed amendments to Regulation A (Extensions of Credit by Federal Reserve Banks) to implement sections 1101 and 1103 of the Dodd-Frank Act (Pub. L. 111-203, 124 Stat. 1376).\1\ The purpose of the proposed amendments was to implement the Dodd-Frank Act revisions to the Board's emergency lending authority in section 13(3) of the Federal Reserve Act that limit the use of this authority to the provision of liquidity through broadly-based facilities for solvent firms in a time of crisis. After careful review and consideration of the comments, the final rule adopted by the Board includes a number of changes and additional limitations to address concerns raised by commenters. --------------------------------------------------------------------------- \1\ 79 FR 615 (January 6, 2014). --------------------------------------------------------------------------- Prior to the enactment of the Dodd-Frank Act, section 13(3) provided that the Board may authorize a Federal Reserve Bank to extend credit to any individual, partnership, or corporation subject to four principal conditions. These conditions required that (1) credit be extended only in unusual and exigent circumstances; (2) credit be extended only if the Board authorizes the lending by the affirmative vote of at least five of its members; \2\ (3) the lending Federal Reserve Bank obtain evidence before extending the credit that the borrower is unable to secure adequate credit from other banking institutions; and (4) the extension of credit be indorsed or otherwise secured to the satisfaction of the Federal Reserve Bank. This statutory authority to extend emergency credit to any person in unusual and exigent circumstances was enacted by Congress in 1932 to enable the Federal Reserve, as the nation's central bank, to provide liquidity in times of financial stress.\3\ --------------------------------------------------------------------------- \2\ A lesser number of votes is required in certain emergency situations where at least five members of the Board are unavailable or not in service. 12 U.S.C. 248(r). \3\ See H.R. Rep. No. 1777, at 19, 20 (1932) (Conf. Rep.); S. Rep. No. 102-167, at 202 (1991) (Conf. Rep.). --------------------------------------------------------------------------- Effective on July 21, 2010, the Dodd-Frank Act (Pub. L. 111-203, 124 Stat. 1376) amended section 13(3) to limit this emergency lending authority to broad-based programs and facilities that relieve liquidity pressures in financial markets. To accomplish this, the Dodd-Frank Act amended section 13(3) to remove the general authority to lend to an individual, partnership, or corporation and to replace that general authority with the limited authority to extend emergency credit only to participants in a program or facility with broad-based eligibility designed for the purpose of providing liquidity to the financial system.\4\ In addition, the amendments to section 13(3) provide that a program or facility that is structured to remove assets from the balance sheet of a single and specific company, or that is established for the purpose of assisting a single and specific company avoid bankruptcy or resolution under a Federal or State insolvency proceeding would not be considered a program or facility with broad-based eligibility.\5\ The Dodd-Frank Act also prohibits lending under section 13(3) to insolvent borrowers, and requires that the Board establish policies and procedures that assign a value to all collateral for an emergency loan and that are designed to ensure that the collateral is sufficient to protect taxpayers from losses. Moreover, section 13(3) was amended to provide that a program or facility may not be established without the prior approval of the Secretary of the Treasury. The Dodd-Frank Act also imposed certain publication and congressional reporting requirements regarding lending under section 13(3). --------------------------------------------------------------------------- \4\ Public Law 13-203, Sec. 1101(a)(2): 124 STAT 2113(amending section 13 of the Federal Reserve Act, 12 U.S.C. 343). \5\ Public Law 13-203, Sec. 1101(a)(6): 124 STAT 2113(amending section 13 of the Federal Reserve Act, 12 U.S.C. 343). --------------------------------------------------------------------------- The draft rule proposed by the Board for public comment adopted all of the requirements and much of the specific statutory language contained in the Dodd-Frank Act amendments to section 13(3). The Board received fewer than a dozen comments on the proposed rule from financial institutions, policy institutions, individuals, and members of Congress. While commenters generally expressed support for the proposed rule, most commenters recommended revisions to the proposed rule. Among the suggestions made by the commenters are that the rule:Provide a more specific definition of what it means for a program or facility to be ``broad-based''; adopt a broader definition of insolvency for purposes of the prohibition on lending to insolvent borrowers; [[Page 78960]] clarify that solvent firms may not borrow for the purpose of passing the proceeds of emergency loans on to insolvent firms; specify that emergency loans would only be made at a penalty rate that exceeds the market rate for such loans; include a specific timeline for evaluating whether an emergency lending program or facility should be terminated; limit the classes of collateral that can be accepted for emergency loans and require that the collateral be independently appraised; and require the Board to seek a joint resolution of Congress prior to granting an emergency loan. The final rule adopts all of the limitations and revisions required by the Dodd-Frank Act. In addition, in response to the comments, the Board has revised the final rule in a number of significant ways. In particular, as discussed below, the Board modified the final rule to: Further limit the definition of a broad-based program by including, in addition to the proposed requirement that the program be designed to provide liquidity to an identifiable market or sector of the financial system and not be for the purpose of assisting a specific firm to avoid bankruptcy or other resolution, a requirement that at least five persons be eligible to participate in the facility and a requirement that the facility not be designed to assist any number of identified firms to avoid bankruptcy or resolution; Expand the definition of insolvency to include potential borrowers that are generally not paying their undisputed debts as they become due during the 90 days preceding borrowing from the program, and potential borrowers that are otherwise determined by the Board or the lending Federal Reserve Bank to be insolvent, in addition to the proposal to identify as insolvent any person in a resolution or bankruptcy proceeding; Provide that loans may not be made to companies that are borrowing for the purpose of lending to insolvent companies; Specify that emergency loans must be extended at a penalty rate; Provide that the Board will make public and report to Congress a description of the market or sector of the financial system to which a program or facility with broad-based eligibility is intended to provide liquidity; Provide that the Board will review each program or facility at least every six months and that each program or facility will terminate within one year from the date of its first extension of credit or its latest renewal date unless the Board determines, by a vote of at least five members of the Board \6\ and with the approval of the Secretary of the Treasury, to renew the program or facility; and, --------------------------------------------------------------------------- \6\ A lesser number of votes is required in certain emergency situations where at least five members of the Board are unavailable or not in service. 12 U.S.C. 248(r). --------------------------------------------------------------------------- Clarify that, if a company or its representative is found to have made a knowing material misrepresentation regarding its solvency in obtaining emergency credit, the credit plus all applicable interest, fees, and penalties will become immediately due and payable, and the Federal Reserve will refer the matter to the relevant law enforcement authorities for appropriate action. II. Section by Section Summary of Final Rule A. Section 201.4(d)--Emergency Credit for Others 1. Authorization To Extend Credit Section 201.4(d)(1) of the final rule provides that, in unusual and exigent circumstances, the Board may, upon the affirmative vote of not less than five of its members,\7\ authorize any Federal Reserve Bank to extend credit under section 13(3) of the FRA through a program or facility with broad-based eligibility. This requirement mirrors the statutory requirement and is unchanged from the proposed rule. Conditions governing when a program or facility has broad-based eligibility are discussed below. --------------------------------------------------------------------------- \7\ The rule permits the Board to authorize lending under the rule by a vote of fewer than five members in certain emergency situations permitted by statute where at least five members of the Board are not available or not in service. 12 U.S.C. 248(r). --------------------------------------------------------------------------- In addition, section 201.4(d)(1) provides that any credit extended under section 13(3) of the FRA is subject to such other conditions as the Board may determine. These could include conditions that govern the timing of, collateral supporting, duration of, consideration for, terms of, counterparties to, and other conditions governing the extension of credit. 2. Approval of the Secretary of the Treasury Section 201.4(d)(2) of the final rule provides that a program or facility under section 13(3) of the FRA may not be established without the prior approval of the Secretary of the Treasury. This condition implements a requirement of the Dodd-Frank Act.\8\ --------------------------------------------------------------------------- \8\ 12 U.S.C. 343(3)(B)(iv). --------------------------------------------------------------------------- One commenter suggested that, in addition to this approval, the Board should seek a joint resolution of Congress in connection with the establishment of a program or facility. While Congress in the Dodd- Frank Act imposed a similar requirement as a condition of certain emergency actions by the Federal Deposit Insurance Corporation (FDIC), Congress did not adopt this requirement in connection with emergency lending under section 13(3) of the FRA. Instead, Congress established a number of other specific procedural requirements for emergency lending in section 1101 of the Dodd-Frank Act, including the requirement that the Secretary of the Treasury approve the establishment of a program or facility. The final rule does not adopt a requirement that Congress ratify a lending program or facility. It is the exclusive prerogative of Congress to determine when and on what matters it will act. However, to further Congressional oversight of emergency lending facilities, the Board's final rule establishes a process by which the Board will promptly provide written notice to Congress of any emergency program or facility established under section 13(3) of the FRA. 3. Disclosure of Justification and Terms Section 201.4(d)(3) of the final rule requires that the Board make publicly available, as soon as is reasonably practicable, and no later than 7 days after the Board authorizes the program or facility, a description of the program or facility, the unusual and exigent circumstances that exist, the intended effect of the program or facility, and the terms and conditions for participation in the program or facility. The final rule also provides that, within the same 7-day period, this information will be provided by the Board to the Committee on Banking, Housing and Urban Affairs of the U.S. Senate and the Committee on Financial Services of the U.S. House of Representatives. Some commenters suggested that the Board provide additional clarity regarding the scope of the market that must be eligible for a facility to have ``broad-based eligibility.'' While this is addressed below, as part of its response to this comment, the Board amended section 201.4(d)(3) of the final rule to require that the Board publicly disclose the market or sector of the financial system to which the program or facility is intended to provide liquidity. The Board added this disclosure requirement to help provide transparency regarding the broad-based nature of a program or facility at the time it is created. [[Page 78961]] 4. Definition of Broad-Based Eligibility The Dodd-Frank Act limits emergency lending under section 13(3) of the FRA to lending conducted through a program or facility ``with broad-based eligibility.'' \9\ The draft implementing rule as originally proposed would have implemented this restriction in the Dodd-Frank Act by incorporating the language contained in the Dodd- Frank Act prohibiting lending for the purpose of removing assets from the balance sheet of ``a single and specific company,'' assisting ``a single and specific company'' to avoid bankruptcy, resolution under Title II of the Dodd-Frank Act, or any other Federal or State insolvency proceeding, or aiding a failing financial company.\10\ --------------------------------------------------------------------------- \9\ 12 U.S.C. 343(3)(A). \10\ See 12 U.S.C. 343(3)(B)(iii). --------------------------------------------------------------------------- Several commenters expressed concern that the reference in the proposed rule to ``a single and specific company'' could allow the Board to circumvent the limits imposed by the Dodd-Frank Act by grouping two or more bankrupt or failing firms in a program or facility. Some of these commenters suggested that the Board specify the number of eligible participants that would be required for a program or facility to have broad-based eligibility. One legislative proposal would provide that a program or facility is not broad-based unless at least five persons are eligible to participate in the program or facility. The Board believes that the requirement that a program or facility have ``broad-based eligibility'' cannot be avoided by grouping two or more failing or bankrupt firms into a single facility. Thus, section 201.4(d)(4) of the final rule has been modified to make clear that an emergency program or facility has broad-based eligibility under the final rule only if three conditions are met. First, the program or facility must be designed for the purpose of providing liquidity to an identifiable market or sector of the financial system. Second, the program or facility must not be designed for the purpose of assisting one or more specific companies to avoid bankruptcy or other resolution, including by removing assets from the balance sheet of the company or companies. The original proposal would have adopted the language in the Dodd-Frank Act that a program not be designed for the purpose of assisting ``a single and specific company'' avoid bankruptcy or resolution. The final rule has been changed to provide that a program or facility may not be designed to assist ``one or more'' specific companies to avoid bankruptcy or resolution. This change is intended to accent that a program or facility would not qualify as a broad-based program or facility if it is designed for the purpose of assisting any number of specific persons or entities to avoid resolution. A program or facility that is designed to remove assets from a single and specific firm's balance sheet to help the firm avoid bankruptcy or resolution such as was done with regard to Bear Stearns would not be permissible. Third, the final rule provides that a program or facility would not be considered broad-based if fewer than five persons are eligible to participate in the program or facility. In this context, eligibility would be determined by qualification under all the terms and conditions established for participation in the program or facility. Together, these limitations are designed to ensure that emergency credit programs and facilities are established only to fulfill the central bank's role as lender of last resort to the financial system and not as a lender to troubled firms seeking to avoid resolution or failure. For example, this approach would permit the Federal Reserve to establish programs or facilities like the Term Asset-backed Securities Loan Facility (TALF), which provided several thousand loans that provided liquidity to fund several billion dollars of student loans, car loans, small business loans and other loans in the securitization market; the Commercial Paper Funding Facility (CPFF), which was a program with broad-based eligibility designed to provide liquidity to the commercial paper market; the Asset-backed Commercial Paper Money Market Mutual Fund Liquidity Facility (AMLF) and the Money Market Investor Funding Facility (MMIFF), which were programs with broad-based eligibility designed to provide liquidity to the money market fund sector; and the Primary Dealer Credit Facility (PDCF), which provided liquidity to all primary dealers in support of trading in the U.S. Government securities market. However, these restrictions would not permit emergency lending to remove assets from a failing firm as was done in the case of the emergency loan to Bear Stearns, or to provide credit to prevent a firm from entering bankruptcy as was done in the case of the emergency credit facility established for AIG. Importantly, the final rule would not authorize a program or facility that sought to evade these limitations by grouping multiple failing or insolvent firms in a single program or facility. Thus, the revisions in the final rule would not permit the Federal Reserve to extend emergency credit in a case like the Bear Stearns or AIG situation simply by establishing a single program or facility for the purpose of providing credit to both Bear Stearns and AIG, or any other number of specific failing or insolvent firms.\11\ --------------------------------------------------------------------------- \11\ While the final rule requires that at least five persons be eligible to participate in a program or facility, that requirement is in addition to the restriction on establishing a program or facility for the purpose of providing credit to prevent the failure or resolution of any number of specific failing or insolvent persons, and would not allow a program or facility designed for the purpose of preventing the resolution or failure of more than five persons. --------------------------------------------------------------------------- The Board is adopting section 201.4(d)(4)(iv) as proposed. That section authorizes the Board to determine the type of mechanism or vehicle used to extend credit, so long as the facility is broad-based. For example, liquidity facilities may extend credit directly to participants in those facilities in some cases, or through a special purpose vehicle in other cases. In any case, the extensions of credit would be subject to all of the requirements related to the provision of liquidity under section 13(3) of the FRA. 5. Definition of Insolvency As noted above, section 1101 of the Dodd-Frank Act requires the Board to ``establish procedures to prohibit borrowing from programs and facilities by borrowers that are insolvent.'' Section 1101 also provides that a borrower ``shall be considered insolvent'' if the borrower ``is in bankruptcy, resolution under Title II of [the Dodd- Frank Act], or any other Federal or State insolvency proceeding.'' \12\ Some commenters suggested that section 1101 does not preclude the Board from identifying other situations where a person or entity has not yet entered into formal proceedings but nevertheless should be deemed to be insolvent and encouraged the Board to extend the definition of insolvency to apply to these circumstances. --------------------------------------------------------------------------- \12\ 124 Stat. 1376 at 2113-15. --------------------------------------------------------------------------- As an initial matter, the final rule adopts the insolvency constraint as provided in the Dodd-Frank Act. Section 201.4(d)(5) provides that a Federal Reserve Bank may not extend credit through a program or facility established under section 13(3) of the FRA to any person or entity that is in bankruptcy, resolution under Title II of the Dodd-Frank Act, or any other Federal or State insolvency proceeding. In response to these comments, the Board has amended the final rule to acknowledge that there may be situations that are not identified [[Page 78962]] explicitly in the statute where the Board may determine that an entity is insolvent. In particular, the final rule provides that a person or entity is insolvent if the person or entity is generally not paying its undisputed debts as they become due during the 90 days preceding the date of borrowing under the program or facility. The final rule also provides that the Board or Federal Reserve Bank may determine, based on recent audited financial statements or other relevant documentation, that an entity is otherwise insolvent. Section 201.4(d)(5) of the final rule requires the Board or the lending Federal Reserve Bank, prior to extending credit, to obtain evidence that the person or entity is not insolvent. As provided by the Dodd-Frank Act, the final rule provides that the Board and a Federal Reserve Bank may rely on a written certification from the person, the chief executive officer of the entity or another authorized officer of the entity, at the time the person or entity initially borrows under a program or facility, that the person or entity is not in bankruptcy or in a resolution or other insolvency proceeding. The Board has broadened this part of the final rule to require that the certification also state that the potential borrower has not failed to generally pay its undisputed debts as they become due during the 90 days preceding the date of borrowing. The statute specifically permits the Board to rely on a certification to establish solvency. Use of a certification is particularly important in the context of programs and facilities with broad-based eligibility because these programs and facilities have the potential to involve numerous borrowers seeking credit in unusual periods of severe illiquidity. A binding certification aids in quickly and effectively making liquidity available on safe and reasonable terms in these difficult economic circumstances. The final rule contains a number of provisions designed to ensure the continued accuracy of the certification. First, the final rule provides that a person or entity that submits a written certification must immediately notify the lending Federal Reserve Bank if the information in the certification changes. Section 201.4(d)(5)(vi) of the final rule also provides that a participant that is or has become insolvent would be prohibited from receiving any new extension of credit under the program or facility. Moreover, to improve the reliability of a certification, the final rule provides that, if a participant or a person has provided a certification under section 201.4(d)(5) or (8) that includes a knowing material misrepresentation, all emergency credit extended to the borrower immediately becomes due and payable, and the Federal Reserve will promptly refer the matter to appropriate law enforcement authorities for action under applicable criminal and civil law. Some commenters expressed concern that third-party conduits would be used to evade any insolvency restrictions in the rule by passing borrowed funds on to an entity that is insolvent. Section 201.4(d)(5)(i) of the final rule provides that a Federal Reserve Bank may not extend credit through a program or facility to any person that is borrowing for the purpose of lending the proceeds of the loan to an insolvent entity. Another commenter suggested that the final rule clarify whether conservatorships are eligible to participate in broad-based facilities. Section 13(3) as amended by the Dodd-Frank Act prohibits lending to an insolvent borrower or to aid a failing firm. As a general matter, conservators are appointed to conserve a failing company's assets.\13\ Accordingly, a conservatorship and a company in conservatorship would not be eligible to borrow from a program or facility established under section 13(3) of the FRA. --------------------------------------------------------------------------- \13\ See 12 U.S.C. 1821(c)(5). --------------------------------------------------------------------------- 6. Indorsement or Other Security Prior to the Dodd-Frank Act, section 13(3) provided that any extension of credit under that section must be ``indorsed or otherwise secured to the satisfaction of the Federal Reserve bank.'' \14\ The Dodd-Frank Act retained this provision of the original statute and added two further requirements. First, the Dodd-Frank Act directs the Board to adopt policies and procedures ``designed to ensure . . . that the security for emergency loans is sufficient to protect taxpayers from losses.'' \15\ Second, the Dodd-Frank Act requires that the Board's policies and procedures ``require that a Federal Reserve bank assign, consistent with sound risk management practices and to ensure protection for the taxpayer, a lendable value to all collateral for a loan executed'' under section 13(3) of the FRA.\16\ --------------------------------------------------------------------------- \14\ See 12 U.S.C. 343, 47 Stat. 715. \15\ 12 U.S.C. 343(3)(B)(1). \16\ Id. --------------------------------------------------------------------------- Protecting taxpayers from losses as a result of emergency lending has always been an important concern for the Board, and the Board notes that the extensions of credit under the emergency lending programs it authorized during the recent financial crisis were all repaid in full with interest. The proposed rule incorporated the new statutory requirements from the Dodd-Frank Act into Regulation A. Some commenters argued that the Board should limit the types of collateral the Federal Reserve Banks may accept in support of an emergency credit. Several commenters argued that the Federal Reserve should establish haircuts for collateral accepted by programs and facilities that extend emergency credit. The final rule continues to emphasize the importance of ensuring that the security for emergency loans is sufficient to protect taxpayers from losses. As proposed and as adopted in the final rule, section 201.4(d)(6) provides that all credit extended under emergency lending programs and facilities must be indorsed or otherwise secured to the satisfaction of the lending Federal Reserve Bank. The final rule also requires the Federal Reserve Bank, no later than at the time the credit is initially extended, to assign a lendable value to all collateral for the program or facility, consistent with sound risk management practices and to ensure protection for the taxpayer. The Federal Reserve Banks have long assigned a lendable value to collateral at the time credit is extended. Much of the collateral accepted as security for emergency lending has a readily available market value. In connection with assigning a lendable value to other collateral, Reserve Banks readily take into account independent appraisals of the collateral that may be available. In all cases, the Reserve Bank applies appropriate discounts or ``haircuts'' to the value of the collateral. The haircuts applied to collateral are described in the Federal Reserve Discount Window & Payment System Risk Collateral Margins Table and the Federal Reserve Collateral Guidelines, available on the Federal Reserve Discount Window & Payment System Risk Web site.\17\ The Federal Reserve Banks also consider the financial strength of the borrower, the presence of any indorsement, and other factors, in determining whether the credit is satisfactorily secured. --------------------------------------------------------------------------- \17\ http://www.frbdiscountwindow.org/index.cfm. --------------------------------------------------------------------------- The Board believes that these provisions allow the Federal Reserve to impose collateral and other requirements to protect the taxpayer from loss and address the statutory requirement for policies and procedures that are designed to ensure protection for the taxpayer. [[Page 78963]] 7. Penalty Rate Section 13(3) of the FRA has always provided that emergency credit extended under that section shall be at rates established in accordance with the provisions of section 14(d) of the FRA. Commenters suggested that the Board amend the proposed rule to require that extensions of emergency credit be subject to a penalty rate of interest. The practice of the Federal Reserve in extending emergency credit has been to set the relevant interest rate at a penalty rate designed to encourage borrowers to repay emergency credit as quickly as possible once the unusual and exigent circumstances that justify the program or facility have receded and financial conditions have normalized. This approach has also ensured that the taxpayer is compensated by a higher interest rate than would be charged during normal times for the increased risk taken in extending emergency credit. Indeed, while the Federal Reserve adopted different rates for the various broad-based facilities that it established during the recent financial crisis, in each case, the rate set for the facility exceeded the rate for comparable instruments during normal times. As a result of this practice, emergency broad-based credit facilities established by the Federal Reserve under section 13(3) terminated and wound down as economic conditions normalized. In keeping with this practice, section 201.4(d)(7) of the final rule provides that a penalty rate will be imposed on emergency extensions of credit. Because the appropriate interest rate depends on a number of factors, such as the duration of the credit, the collateral requirements, and the other terms and conditions for the credit, it is not feasible to establish a single penalty rate for all emergency facilities or to set penalty rates in advance of designing the facility. Consequently, the final rule provides that the interest rate for credit extended under section 13(3) must be at a level that is a premium to the market rate in normal circumstances, affords liquidity in unusual and exigent circumstances, and encourages repayment and discourages use of the program as unusual and exigent circumstances normalize. Section 201.4(d)(7)(iii) of the final rule sets forth a non- exhaustive list of factors that the Board will take into account when establishing the penalty rate. These factors include the condition of the affected markets and the financial system generally, the historical rate of interest for loans of comparable terms and maturity during normal times, the purpose of the program or facility, the risk of repayment, the collateral supporting the credit, the duration, terms and amount of the credit, and other factors relevant to ensuring the taxpayer is appropriately compensated for the risks associated with the emergency credit. The final rule also explains that the rate on emergency credit under section 13(3) may be set by auction or other method consistent with section 14(d) of the FRA. Such an auction could be structured with a minimum stop out rate to ensure that the resulting rate would satisfy the requirements of a penalty rate. 8. Evidence Regarding Unavailability of Adequate Credit Accommodation Section 13(3) has always required that a Federal Reserve Bank, prior to extending credit to any participant in a program or facility under that section, obtain evidence that such participant is unable to secure adequate credit accommodations from other banking institutions. The proposed rule incorporated this requirement and provided that this evidence may include evidence based on economic conditions in the market or markets addressed by the program or facility or evidence obtained from other sources, including facility or market participants and certifications from borrowers. In response to comments, the Board has amended the final rule to add as relevant evidence a certification from the participant that it is unable to secure adequate credit accommodations from other banking institutions. 9. Termination of Program or Facility The Dodd-Frank Act requires that the Board's policies and procedures with respect to section 13(3) extensions of credit be designed to ensure that any such program is terminated in a timely and orderly fashion.\18\ In order to address this requirement, the proposed rule would have required the Board periodically to review the existence of unusual and exigent circumstances; the extent of usage of the program or facility; the extent to which the continuing authorization of the program or facility facilitates restoring or sustaining confidence in financial markets; economic and market conditions; the functioning of financial markets; the ongoing need for the liquidity support provided by such program or facility; and such other factors as the Board may deem to be appropriate. --------------------------------------------------------------------------- \18\ Dodd-Frank Act Section 1101(a)(6). --------------------------------------------------------------------------- Some commenters suggested that a specific time period for review be adopted. The Board has amended the draft proposal to adopt this suggestion. Section 201.4(d)(9)(i) of the final rule provides that a program or facility will terminate no later than one year after the date of the first extension of credit under the program or facility. The rule allows the Board to renew the program or facility if it finds, by a vote of five members,\19\ that unusual and exigent circumstances continue to exist, and the Secretary of the Treasury has approved the renewal. Each renewal may extend the program or facility for not more than one year. The final rule requires the Board promptly to report publicly and to the relevant congressional committees any renewal of a program or facility under section 13(3). --------------------------------------------------------------------------- \19\ See 12 U.S.C. 248(r). --------------------------------------------------------------------------- The final rule has been amended to provide that the Board will, not less frequently than every six months, review whether each emergency lending program or facility should be terminated. The final rule provides that the Board may terminate an emergency lending program or facility at any time, and will terminate an emergency program or facility upon finding that conditions no longer warrant continuation of the program or facility. The final rule retains the provisions of the proposed rule providing factors for the Board to consider in conducting this review, with some additional modifications. Specifically, the final rule provides that the Board will consider such factors as the continued existence of unusual and exigent circumstances; the extent of usage of the program or facility; the extent to which the continuing authorization of the program or facility facilitates restoring or sustaining confidence in the identified financial markets; the ongoing need for the liquidity support provided by such program or facility; and other appropriate factors. One commenter suggested that the final rule include procedures for the orderly unwinding of a program or facility, including how the Board will cover any associated losses. The Board expects, as it has with past facilities, to evaluate the appropriate methods for an orderly unwinding of any emergency credit facility at the time the facility is unwound. 10. Reporting Requirements The Dodd-Frank Act contains detailed reporting requirements with respect to section 13(3) extensions of credit.\20\ The proposed rule set forth the statutory requirements as enacted, and no comments were received on those [[Page 78964]] provisions of the proposed rule. Therefore, the Board is adopting these provisions as proposed. The final rule provides that the Board will comply with 12 U.S.C. 248(s) and 12 U.S.C. 343(3)(C) pursuant to their terms. --------------------------------------------------------------------------- \20\ Dodd-Frank Act Sections 1101(a)(6) and 1103(b). --------------------------------------------------------------------------- 11. No Obligation To Extend Credit Section 201.4(d)(11) of the proposed rule provided that Federal Reserve Banks have no obligation to extend credit to any particular person or entity through an emergency lending program or facility. This provision mirrors the provision applicable to lending to depository institutions set forth in section 201.3(b) of Regulation A. No comments were received on this provision, and the Board is adopting it as proposed. 12. Participation in Programs and Facilities and Vendor Selection The final rule reflects existing legal requirements that participation in any program or facility under section 13(3) of the Federal Reserve Act will not be limited or conditioned on the basis of any legally prohibited basis, such as the race, religion, color, gender, national origin, age or disability of the borrower. Moreover, in accordance with existing law, the selection of third-party vendors used in the design, marketing or implementation of any program or facility under this subsection will be without regard to the race, religion, color, gender, national origin, age or disability of the vendor or any principal shareholder of the vendor, and, to the extent possible and consistent with law, will involve a process designed to support equal opportunity and diversity. 13. Short-Term Emergency Credit Secured Solely by United States or Agency Obligations Section 201.4(d)(13) of the proposed rule retained, but relocated, a provision in current Regulation A that authorizes a Federal Reserve Bank to extend credit under section 13(13) of the FRA if the collateral used to secure the credit consists solely of obligations of, or obligations fully guaranteed as to principal and interest by, the United States or an agency of the United States. Section 201.4(d)(13) of the final rule retains the provision that extensions of credit under this section be at a rate above the highest rate in effect for advances to depository institutions. As set forth in section 13(13) of the FRA, section 201.4(d)(13) of the final rule also provides that credit extended under this provision may not be extended for a term exceeding 90 days. One commenter suggested that section 201.4(d)(13) should be revised to limit the number of times a loan issued pursuant to its provisions may be rolled over. However, the commenter did not provide a suggested limit on roll overs and acknowledged that there would need to be exceptions made to any limit imposed. Instead of imposing such a limit, the Board will rely on its ability to assess whether unusual and exigent circumstances continue to exist at the time that the loan is renewed in order to appropriately limit roll overs of such loans. Therefore, the Board is retaining section 201.4(d)(13) as written. B. Section 201.3(b)--No Obligation To Make Advances or Discounts Section 201.3(b) of the final rule reflects a technical change to conform the language of that section with the language of section 201.4(d)(11) of the final rule. III. Administrative Law Matters A. Regulatory Flexibility Act The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) (RFA) requires an agency either to provide an initial regulatory flexibility analysis with a proposed rule for which a general notice of proposed rulemaking is required or to certify that the proposed rule will not have a significant economic impact on a substantial number of small entities. The Board solicited public comment on the rule in a notice of proposed rulemaking. The Board did not receive any comments regarding burden to small banking organizations. In accordance with section 1101 and 1103 of the Dodd-Frank Act, the Board is amending Regulation A (12 CFR part 201 et seq.) to establish policies and procedures for emergency lending under section 13(3) of the FRA. The reasons and justification for the final rule are described in the SUPPLEMENTARY INFORMATION. The Board does not believe that the final rule duplicates, overlaps, or conflicts with any other Federal rules. Under regulations issued by the Small Business Administration (``SBA''), a ``small entity'' includes those firms within the ``Finance and Insurance'' sector with asset sizes that vary from $75.5 million or less in assets to $550 million or less in assets. The Board believes that the Finance and Insurance sector constitutes a reasonable universe of firms for these purposes because such firms generally engage in activities that are financial in nature and the vast majority of emergency loans under section 13(3) during the recent financial crisis were extended to such firms. As discussed in the SUPPLEMENTARY INFORMATION, the final rule would apply to any participant in an emergency lending program or facility with broad-based eligibility. To the extent that small entities are participants in these programs or facilities, they would be receiving extensions of emergency credit from Federal Reserve Banks. It is not possible to ascertain at this time the number of small entities that might participate in these programs and facilities were they to be authorized, or what requirements would be imposed on them if they do so. At a minimum, it is likely that participants would be required to pay interest on credit extended to them and to keep records of the use of proceeds of such extensions of credit. However, the positive economic impact of receiving such a credit is likely to substantially outweigh any economic burden of participating in the program or facility. In light of the foregoing, the Board does not believe that the final rule would have a significant negative economic impact on a substantial number of small entities. B. Paperwork Reduction Act Analysis Certain provisions of the final rule contain ``collection of information'' requirements within the meaning of the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501-3521). In accordance with the requirements of the PRA, the Board may not conduct or sponsor, and the respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number. The OMB control number for the Board is 7100-NEW. The Board reviewed the final rule under the authority delegated to the Board by OMB. The final rule contains requirements subject to the PRA. The reporting requirements are found in section 201.4(d)(5)(iv)(A). The Board indicated in the proposed rule that the reporting requirements associated with the Regulation A would be minimal and no PRA burden was taken. The Board received no comments on this aspect of the proposal. However, based on the comments received for clarifying the proposed rule to prohibit solvent firms from passing the proceeds of emergency loans on to insolvent firms and adopting a broader definition of insolvency, the Board will take reporting burden for this section. The Board has a continuing interest in the public's opinions of collections of information. At any time, comments regarding the burden estimate, or any other aspect of this collection of information, including suggestions for [[Page 78965]] reducing the burden, may be sent to: Secretary, Board of Governors of the Federal Reserve System, 20th and C Streets NW., Washington, DC 20551. A copy of the comments may also be submitted to the OMB desk officer (1) by mail to U.S. Office of Management and Budget, 725 17th Street NW., 10235, Washington, DC 20503; (2) by facsimile to 202-395- 6974; or (3) by email to: oira_submission@omb.eop.gov, Attention, Federal Reserve Board Agency Desk Officer. Proposed Information Collection Title of Information Collection: Reporting Requirements Associated with Regulation A (Extensions of Credit by Federal Reserve Banks). Frequency of Response: Event-generated. Affected Public: Businesses, individuals or other persons. Respondents: Any participant in a program or facility with broad- based eligibility. Abstract: Sections 1101 and 1103 of the Dodd-Frank Act amend the emergency lending authorities provided in section 13(3) of the Federal Reserve Act. The amendments require the Board, in consultation with the Secretary of the Treasury, to establish by regulation policies and procedures with respect to such emergency lending. The purpose of the amendments to Regulation A in this final rule is to implement the Dodd- Frank Act revisions to the Board's emergency lending authority in section 13(3) of the Federal Reserve Act that limit the use of this authority to the provision of liquidity through broadly-based facilities for solvent firms in a time of crisis. Reporting Requirements Section 201.4(d)(5)(iv)(A) provides that a Federal Reserve Bank may rely on a written certification from the person or from the chief executive officer or other authorized officer of the entity, at the time the person or entity initially borrows under the program or facility, that the person or entity is not in bankruptcy, resolution under Title II of Public Law 111-203 (12 U.S.C. 5381 et seq.) or any other Federal or State insolvency proceeding, and has not failed to generally pay its undisputed debts as they become due during the 90 days preceding the date of borrowing under the program or facility, and is not borrowing for the purpose of lending the proceeds of the loan to a person or entity that is insolvent. Estimated Burden per Response: 5 hours. Number of Respondents: 10 (The Federal Reserve is not currently aware of any respondents, but for purposes of the PRA we will assume 10. If or when we receive any certifications we intend to update this data upon the next renewal of the information collection). Total Estimated Annual Burden: 50 hours. C. Invitation for Comments on Use of Plain Language Section 722 of the Gramm-Leach Bliley Act of 1999 requires the Federal banking agencies to use plain language in all proposed and final rules published after January 1, 2000.\21\ The Board received no comments on these matters and believes that the final rule is written plainly and clearly. --------------------------------------------------------------------------- \21\ 12 U.S.C. 4809. --------------------------------------------------------------------------- List of Subjects in 12 CFR Part 201 Banks, Banking, Federal Reserve System, Reporting and recordkeeping requirements. Authority and Issuance For the reasons set forth in the preamble, the Board amends 12 CFR part 201 (Regulation A) as follows: PART 201--EXTENSIONS OF CREDIT BY FEDERAL RESERVE BANKS (REGULATION A) 0 1. The authority citation for part 201 is revised to read as follows: Authority: 12 U.S.C. 248(i)-(j) and (s), 343 et seq., 347a, 347b, 347c, 348 et seq., 357, 374, 374a, and 461. 0 2. Section 201.3 paragraph (b) is revised to read as follows: Sec. 201.3 Extensions of credit generally. * * * * * (b) No obligation to make advances or discounts. This section does not entitle any person or entity to obtain any credit or any increase, renewal or extension of maturity of any credit from a Federal Reserve Bank. * * * * * Sec. 201.109 [Amended] 0 3. In Sec. 201.109, redesignate footnotes 4 through 6 as footnotes 6 through 8. Sec. 201.108 [Amended] 0 4. In Sec. 201.108, redesignate footnotes 2 and 3 as footnotes 4 and 5. Sec. 201.51 [Amended] 0 5. In Sec. 201.51, redesignate footnote 1 as footnote 3. 0 6. Section 201.4 paragraph (d) is revised to read as follows: Sec. 201.4 Availability and terms of credit. * * * * * (d) Emergency credit for others--(1) Authorization to extend credit. In unusual and exigent circumstances, the Board, by the affirmative vote of not less than five members,\1\ may authorize any Federal Reserve Bank, subject to such conditions and during such periods as the Board may determine, to extend credit to any participant in a program or facility with broad-based eligibility established and operated in accordance with this paragraph (d). --------------------------------------------------------------------------- \1\ Unless fewer are authorized pursuant to section 11(r) of the Federal Reserve Act. 12 U.S.C. 248(r). --------------------------------------------------------------------------- (2) Approval of the Secretary of the Treasury. A program or facility may not be established under this paragraph (d) without obtaining the prior approval of the Secretary of the Treasury. (3) Disclosure of justification and terms. As soon as is reasonably practicable, and no later than 7 days after a program or facility is authorized under this paragraph (d), the Board and the authorized Federal Reserve Bank or Federal Reserve Banks, as appropriate, will make publicly available a description of the program or facility, a description of the market or sector of the financial system to which the program or facility is intended to provide liquidity, a description of the unusual and exigent circumstances that exist, the intended effect of the program or facility, and the terms and conditions for participation in the program or facility. In addition, within the same 7-day period, the Board will provide a copy of this information to the Committee on Banking, Housing and Urban Affairs of the U.S. Senate and the Committee on Financial Services of the U.S. House of Representatives. (4) Broad-based eligibility. (i) A program or facility established under this paragraph (d) must have broad-based eligibility in accordance with terms established by the Board. (ii) For purposes of this paragraph (d), a program or facility has broad-based eligibility only if the program or facility is designed to provide liquidity to an identifiable market or sector of the financial system; (iii) A program or facility will not be considered to have broad- based eligibility for purposes of this paragraph (d) if: (A) The program or facility is designed for the purpose of assisting one or more specific companies avoid bankruptcy, resolution under Title II of Dodd-Frank Wall Street Reform and Consumer Protection Act (Pub. L. 111-203, 12 U.S.C. 5381 et seq.), or any other Federal or State insolvency proceeding, including by removing assets from the [[Page 78966]] balance sheet of one or more such company; (B) The program or facility is designed for the purpose of aiding one or more failing financial companies; or (C) Fewer than five persons or entities would be eligible to participate in the program or facility. (iv) A Federal Reserve Bank may extend credit through a program or facility with broad-based eligibility established under this paragraph (d) through such mechanism or vehicle as the Board determines would facilitate the extension of such credit. (5) Insolvency. (i) A Federal Reserve Bank may not extend credit through a program or facility established under this paragraph (d) to any person or entity that is insolvent or to any person or entity that is borrowing for the purpose of lending the proceeds of the loan to a person or entity that is insolvent. (ii) Before extending credit through a program or facility established under this paragraph (d) to any person or entity, the Federal Reserve Bank must obtain evidence that the person or entity is not insolvent. (iii) A person or entity is ``insolvent'' for purposes of this paragraph (d) if: (A) The person or entity is in bankruptcy, resolution under Title II of Public Law 111-203 (12 U.S.C. 5381 et seq.) or any other Federal or State insolvency proceeding; (B) The person or entity is generally not paying its undisputed debts as they become due during the 90 days preceding the date of borrowing under the program or facility; or (C) The Board or Federal Reserve Bank otherwise determines that the person or entity is insolvent. (iv) For purposes of meeting the requirements of this paragraph (d)(5), the Board or Federal Reserve Bank, as relevant, may rely on: (A) A written certification from the person or from the chief executive officer or other authorized officer of the entity, at the time the person or entity initially borrows under the program or facility, that the person or entity is not in bankruptcy, resolution under Title II of Public Law 111-203 (12 U.S.C. 5381 et seq.) or any other Federal or State insolvency proceeding, and has not failed to generally pay its undisputed debts as they become due during the 90 days preceding the date of borrowing under the program or facility; (B) Recent audited financial statements of the person or entity; or (C) Other information that the Board or the Federal Reserve Bank may determine to be relevant. (v) A person or officer (or successor of either) that submits a written certification under this subparagraph must immediately notify the lending Federal Reserve Bank if the information in the certification changes. (vi) Upon a finding by the Board or a Federal Reserve Bank that a participant, including a participant that has provided a certification under this paragraph (d)(5), is or has become insolvent, that participant is not eligible for any new extension of credit from a program or facility established under this paragraph (d) until such time as the Board or a Federal Reserve Bank determines that such participant is no longer insolvent. (vii) If a participant or person has provided a certification under this paragraph (d)(5) or paragraph (d)(8)(ii) of this section that includes a knowing material misrepresentation in the certification, all extensions of credit made pursuant to this paragraph (d) that are outstanding to the relevant participant shall become immediately due and payable, and all accrued interest, fees and penalties shall become immediately due and payable. The Board or the lending Federal Reserve Bank will also refer the matter to the relevant law enforcement authorities for investigation and action in accordance with applicable criminal and civil law. (6) Indorsement or other security. (i) All credit extended under a program or facility established under this paragraph (d) must be indorsed or otherwise secured, in each case, to the satisfaction of the lending Federal Reserve Bank. (ii) In determining whether an extension of credit under any program or facility established under this paragraph (d) is secured to its satisfaction, a Federal Reserve Bank must, prior to or at the time the credit is initially extended, assign a lendable value to all collateral for the program or facility, consistent with sound risk management practices and to ensure protection for the taxpayer. (7) Penalty rate and fees. (i) The Board will determine the interest rate to be charged on any credit extended through a program or facility established under this section in accordance with this paragraph (d) and the provisions of section 14, subdivision (d) of the Federal Reserve Act (12 U.S.C. 357). The Board may determine the interest rate by auction or such other method as the Board determines in accordance with section 14, subdivision (d) of the Federal Reserve Act (12 U.S.C. 357). (ii) The interest rate established for credit extended through a program or facility established under this section will be set at a penalty level that: (A) Is a premium to the market rate in normal circumstances; (B) Affords liquidity in unusual and exigent circumstances; and (C) Encourages repayment of the credit and discourages use of the program or facility as the unusual and exigent circumstances that motivated the program or facility recede and economic conditions normalize. (iii) In determining the rate, the Board will consider the condition of affected markets and the financial system generally, the historical rate of interest for loans of comparable terms and maturity during normal times, the purpose of the program or facility, the risk of repayment, the collateral supporting the credit, the duration, terms and amount of the credit, and any other factor that the Board determines to be relevant to ensuring that the taxpayer is appropriately compensated for the risks associated with the credit extended under the program or facility and the purposes of this paragraph (d) are fulfilled. (iv) In addition to the rate established and charged under this paragraph (d)(7), the Board may require the payment of any fees, penalties, charges or other consideration the Board determines to be appropriate to protect and appropriately compensate the taxpayer for the risks associated with the credit extended under the program or facility. (8) Evidence regarding unavailability of adequate credit accommodation. (i) Each lending Federal Reserve Bank must obtain evidence that, under the prevailing circumstances, participants in a program or facility established under this paragraph (d) are unable to secure adequate credit accommodations from other banking institutions. (ii) Evidence required under this paragraph (d)(8) may be based on economic conditions in the market or markets intended to be addressed by the program or facility, a written certification from the person or from the chief executive officer or other authorized officer of the entity at the time the person or entity initially borrows under the program or facility, or other evidence from participants or other sources. (9) Termination of program or facility. (i) A program or facility established under this paragraph (d) shall cease extending new credit no later than one year after the date of the first extension of credit under the program or facility or the date of any extension of the program or facility by the Board under paragraph (d)(9)(ii) of this section. (ii) A program or facility may be renewed upon the vote of not less than [[Page 78967]] five members of the Board \2\ that unusual and exigent circumstances continue to exist and the program or facility continues to appropriately provide liquidity to the financial system, and the approval of the Secretary of the Treasury. --------------------------------------------------------------------------- \2\ Unless fewer are authorized pursuant to section 11(r) of the Federal Reserve Act. 12 U.S.C. 248(r). --------------------------------------------------------------------------- (iii) The Board shall make the disclosures required under paragraph (d)(3) of this section to the public and the relevant congressional committees no later than 7 days after renewing a program or facility under this paragraph (d)(9). (iv) The Board may at any time terminate a program or facility established under this paragraph (d). To ensure that the program or facility under this paragraph (d) is terminated in a timely and orderly fashion, the Board will periodically review, no less frequently than once every 6 months, the existence of unusual and exigent circumstances, the extent of usage of the program or facility, the extent to which the continuing authorization of the program or facility facilitates restoring or sustaining confidence in the identified financial markets, the ongoing need for the liquidity support provided by such program or facility, and such other factors as the Board may deem to be appropriate. The Board will terminate lending under a program or facility promptly upon finding that conditions no longer warrant the continuation of the program or facility or that continuation of the program or facility is no longer appropriate. (v) A program or facility that has been terminated will cease extending new credit and will collect existing loans pursuant to the applicable terms and conditions. (10) Reporting requirements. The Board will comply with the reporting requirements of 12 U.S.C. 248(s) and 12 U.S.C. 343(3)(C) pursuant to their terms. (11) No obligation to extend credit. This paragraph (d) does not entitle any person or entity to obtain any credit or any increase, renewal or extension of maturity of any credit from a Federal Reserve Bank. (12) Participation in programs and facilities and vendor selection. (i) Participation in any program or facility under this paragraph (d) shall not be limited or conditioned on the basis of any legally prohibited basis, such as the race, religion, color, gender, national origin, age or disability of the borrower. (ii) The selection of any third-party vendor used in the design, marketing or implementation of any program or facility under this paragraph (d) shall be without regard to the race, religion, color, gender, national origin, age or disability of the vendor or any principal shareholder of the vendor, and, to the extent possible and consistent with law, shall involve a process designed to support equal opportunity and diversity. (13) Short-term emergency credit secured solely by United States or agency obligations. In unusual and exigent circumstances and after consultation with the Board, a Federal Reserve Bank may extend credit under section 13(13) of the Federal Reserve Act if the collateral used to secure such credit consists solely of obligations of, or obligations fully guaranteed as to principal and interest by, the United States or an agency thereof. Prior to extending credit under this paragraph (d)(13), the Federal Reserve Bank must obtain evidence that credit is not available from other sources and failure to obtain such credit would adversely affect the economy. Credit extended under this paragraph (d)(13) may not be extended for a term exceeding 90 days, must be extended at a rate above the highest rate in effect for advances to depository institutions as determined in accordance with section 14(d) of the Federal Reserve Act, and is subject to such limitations and conditions as provided by the Board. * * * * * By order of the Board of Governors of the Federal Reserve System, November 30, 2015. Robert deV. Frierson, Secretary of the Board. [FR Doc. 2015-30584 Filed 12-17-15; 8:45 am] BILLING CODE P
![78959
Rules and Regulations Federal Register
Vol. 80, No. 243
Friday, December 18, 2015
This section of the FEDERAL REGISTER (Extensions of Credit by Federal Reserve authority with the limited authority to
contains regulatory documents having general Banks) to implement sections 1101 and extend emergency credit only to
applicability and legal effect, most of which 1103 of the Dodd-Frank Act (Pub. L. participants in a program or facility
are keyed to and codified in the Code of 111–203, 124 Stat. 1376).1 The purpose with broad-based eligibility designed for
Federal Regulations, which is published under of the proposed amendments was to the purpose of providing liquidity to the
50 titles pursuant to 44 U.S.C. 1510.
implement the Dodd-Frank Act financial system.4 In addition, the
The Code of Federal Regulations is sold by revisions to the Board’s emergency amendments to section 13(3) provide
the Superintendent of Documents. Prices of lending authority in section 13(3) of the that a program or facility that is
new books are listed in the first FEDERAL Federal Reserve Act that limit the use of structured to remove assets from the
REGISTER issue of each week. this authority to the provision of balance sheet of a single and specific
liquidity through broadly-based company, or that is established for the
facilities for solvent firms in a time of purpose of assisting a single and
FEDERAL RESERVE SYSTEM crisis. After careful review and specific company avoid bankruptcy or
consideration of the comments, the final resolution under a Federal or State
12 CFR Part 201 rule adopted by the Board includes a insolvency proceeding would not be
[Regulation A; Docket No. R–1476] number of changes and additional considered a program or facility with
limitations to address concerns raised broad-based eligibility.5 The Dodd-
RIN 7100–AE08 by commenters. Frank Act also prohibits lending under
Prior to the enactment of the Dodd- section 13(3) to insolvent borrowers,
Extensions of Credit by Federal
Frank Act, section 13(3) provided that and requires that the Board establish
Reserve Banks the Board may authorize a Federal policies and procedures that assign a
AGENCY: Board of Governors of the Reserve Bank to extend credit to any value to all collateral for an emergency
Federal Reserve System. individual, partnership, or corporation loan and that are designed to ensure that
ACTION: Final rule. subject to four principal conditions. the collateral is sufficient to protect
These conditions required that (1) credit taxpayers from losses. Moreover, section
SUMMARY: The Board is adopting be extended only in unusual and 13(3) was amended to provide that a
amendments to Regulation A exigent circumstances; (2) credit be program or facility may not be
(Extensions of Credit by Federal Reserve extended only if the Board authorizes established without the prior approval
Banks) to implement the emergency the lending by the affirmative vote of at of the Secretary of the Treasury. The
lending authorities provided under the least five of its members; 2 (3) the Dodd-Frank Act also imposed certain
3rd undesignated paragraph of section lending Federal Reserve Bank obtain publication and congressional reporting
13 of the Federal Reserve Act (the FRA) evidence before extending the credit requirements regarding lending under
as amended by sections 1101 and 1103 that the borrower is unable to secure section 13(3).
of the Dodd-Frank Wall Street Reform adequate credit from other banking The draft rule proposed by the Board
and Consumer Protection Act (the institutions; and (4) the extension of for public comment adopted all of the
Dodd-Frank Act). These provisions of credit be indorsed or otherwise secured requirements and much of the specific
the Dodd-Frank Act require the Board, to the satisfaction of the Federal Reserve statutory language contained in the
in consultation with the Secretary of the Bank. This statutory authority to extend Dodd-Frank Act amendments to section
Treasury, to establish by regulation emergency credit to any person in 13(3). The Board received fewer than a
policies and procedures with respect to unusual and exigent circumstances was
dozen comments on the proposed rule
emergency lending under section 13(3) enacted by Congress in 1932 to enable
from financial institutions, policy
of the FRA. the Federal Reserve, as the nation’s
institutions, individuals, and members
DATES: Effective January 1, 2016. central bank, to provide liquidity in
of Congress.
FOR FURTHER INFORMATION CONTACT: times of financial stress.3
Effective on July 21, 2010, the Dodd- While commenters generally
Laurie S. Schaffer, Associate General expressed support for the proposed rule,
Counsel (202) 452–2272, Sophia H. Frank Act (Pub. L. 111–203, 124 Stat.
1376) amended section 13(3) to limit most commenters recommended
Allison, Special Counsel (202) 452– revisions to the proposed rule. Among
3565, or Jay R. Schwarz, Senior Counsel this emergency lending authority to
broad-based programs and facilities that the suggestions made by the
(202) 452–2970, Legal Division. Board of commenters are that the rule:
relieve liquidity pressures in financial
Governors of the Federal Reserve
markets. To accomplish this, the Dodd- • Provide a more specific definition
System, 20th Street and Constitution of what it means for a program or
Frank Act amended section 13(3) to
Ave. NW., Washington, DC 20551. For facility to be ‘‘broad-based’’;
remove the general authority to lend to
the hearing impaired only,
an individual, partnership, or • adopt a broader definition of
Telecommunications Device for the Deaf insolvency for purposes of the
corporation and to replace that general
asabaliauskas on DSK5VPTVN1PROD with RULES
(TDD) users may contact (202) 263– prohibition on lending to insolvent
4869. 1 79 FR 615 (January 6, 2014). borrowers;
SUPPLEMENTARY INFORMATION: 2A lesser number of votes is required in certain
4 Public Law 13–203, Sec. 1101(a)(2): 124 STAT
emergency situations where at least five members
I. Introduction of the Board are unavailable or not in service. 12 2113(amending section 13 of the Federal Reserve
U.S.C. 248(r). Act, 12 U.S.C. 343).
On December 23, 2013, the Board 3 See H.R. Rep. No. 1777, at 19, 20 (1932) (Conf. 5 Public Law 13–203, Sec. 1101(a)(6): 124 STAT
invited public comment on proposed Rep.); S. Rep. No. 102–167, at 202 (1991) (Conf. 2113(amending section 13 of the Federal Reserve
amendments to Regulation A Rep.). Act, 12 U.S.C. 343).
VerDate Sep<11>2014 17:22 Dec 17, 2015 Jkt 238001 PO 00000 Frm 00001 Fmt 4700 Sfmt 4700 E:\FR\FM\18DER1.SGM 18DER1](https://thefederalregister.org/doc/80_FR_79202/page/1.svg)
![Federal Register / Vol. 80, No. 243 / Friday, December 18, 2015 / Rules and Regulations 78961
4. Definition of Broad-Based Eligibility companies to avoid bankruptcy or Federal Reserve to extend emergency
The Dodd-Frank Act limits emergency resolution. This change is intended to credit in a case like the Bear Stearns or
lending under section 13(3) of the FRA accent that a program or facility would AIG situation simply by establishing a
to lending conducted through a program not qualify as a broad-based program or single program or facility for the
or facility ‘‘with broad-based facility if it is designed for the purpose purpose of providing credit to both Bear
of assisting any number of specific Stearns and AIG, or any other number
eligibility.’’ 9 The draft implementing
persons or entities to avoid resolution. of specific failing or insolvent firms.11
rule as originally proposed would have
A program or facility that is designed to The Board is adopting section
implemented this restriction in the
remove assets from a single and specific 201.4(d)(4)(iv) as proposed. That section
Dodd-Frank Act by incorporating the authorizes the Board to determine the
firm’s balance sheet to help the firm
language contained in the Dodd-Frank type of mechanism or vehicle used to
avoid bankruptcy or resolution such as
Act prohibiting lending for the purpose extend credit, so long as the facility is
was done with regard to Bear Stearns
of removing assets from the balance broad-based. For example, liquidity
would not be permissible.
sheet of ‘‘a single and specific Third, the final rule provides that a facilities may extend credit directly to
company,’’ assisting ‘‘a single and program or facility would not be participants in those facilities in some
specific company’’ to avoid bankruptcy, considered broad-based if fewer than cases, or through a special purpose
resolution under Title II of the Dodd- five persons are eligible to participate in vehicle in other cases. In any case, the
Frank Act, or any other Federal or State the program or facility. In this context, extensions of credit would be subject to
insolvency proceeding, or aiding a eligibility would be determined by all of the requirements related to the
failing financial company.10 qualification under all the terms and provision of liquidity under section
Several commenters expressed conditions established for participation 13(3) of the FRA.
concern that the reference in the in the program or facility.
proposed rule to ‘‘a single and specific Together, these limitations are 5. Definition of Insolvency
company’’ could allow the Board to designed to ensure that emergency As noted above, section 1101 of the
circumvent the limits imposed by the credit programs and facilities are Dodd-Frank Act requires the Board to
Dodd-Frank Act by grouping two or established only to fulfill the central ‘‘establish procedures to prohibit
more bankrupt or failing firms in a bank’s role as lender of last resort to the borrowing from programs and facilities
program or facility. Some of these financial system and not as a lender to by borrowers that are insolvent.’’
commenters suggested that the Board troubled firms seeking to avoid Section 1101 also provides that a
specify the number of eligible resolution or failure. For example, this borrower ‘‘shall be considered
participants that would be required for approach would permit the Federal insolvent’’ if the borrower ‘‘is in
a program or facility to have broad- Reserve to establish programs or bankruptcy, resolution under Title II of
based eligibility. One legislative facilities like the Term Asset-backed [the Dodd-Frank Act], or any other
proposal would provide that a program Securities Loan Facility (TALF), which Federal or State insolvency
or facility is not broad-based unless at provided several thousand loans that proceeding.’’ 12 Some commenters
least five persons are eligible to provided liquidity to fund several suggested that section 1101 does not
participate in the program or facility. billion dollars of student loans, car preclude the Board from identifying
The Board believes that the loans, small business loans and other other situations where a person or entity
requirement that a program or facility loans in the securitization market; the has not yet entered into formal
have ‘‘broad-based eligibility’’ cannot be Commercial Paper Funding Facility proceedings but nevertheless should be
avoided by grouping two or more failing (CPFF), which was a program with deemed to be insolvent and encouraged
or bankrupt firms into a single facility. broad-based eligibility designed to the Board to extend the definition of
Thus, section 201.4(d)(4) of the final provide liquidity to the commercial insolvency to apply to these
rule has been modified to make clear paper market; the Asset-backed circumstances.
that an emergency program or facility Commercial Paper Money Market As an initial matter, the final rule
has broad-based eligibility under the Mutual Fund Liquidity Facility (AMLF) adopts the insolvency constraint as
final rule only if three conditions are and the Money Market Investor Funding provided in the Dodd-Frank Act.
met. First, the program or facility must Facility (MMIFF), which were programs Section 201.4(d)(5) provides that a
be designed for the purpose of providing with broad-based eligibility designed to Federal Reserve Bank may not extend
liquidity to an identifiable market or provide liquidity to the money market credit through a program or facility
sector of the financial system. fund sector; and the Primary Dealer established under section 13(3) of the
Second, the program or facility must Credit Facility (PDCF), which provided FRA to any person or entity that is in
not be designed for the purpose of liquidity to all primary dealers in bankruptcy, resolution under Title II of
assisting one or more specific support of trading in the U.S. the Dodd-Frank Act, or any other
companies to avoid bankruptcy or other Government securities market. Federal or State insolvency proceeding.
resolution, including by removing assets However, these restrictions would not In response to these comments, the
from the balance sheet of the company permit emergency lending to remove Board has amended the final rule to
or companies. The original proposal assets from a failing firm as was done in acknowledge that there may be
would have adopted the language in the the case of the emergency loan to Bear situations that are not identified
Dodd-Frank Act that a program not be Stearns, or to provide credit to prevent
designed for the purpose of assisting ‘‘a a firm from entering bankruptcy as was 11 While the final rule requires that at least five
asabaliauskas on DSK5VPTVN1PROD with RULES
done in the case of the emergency credit persons be eligible to participate in a program or
single and specific company’’ avoid facility, that requirement is in addition to the
bankruptcy or resolution. The final rule facility established for AIG. Importantly, restriction on establishing a program or facility for
has been changed to provide that a the final rule would not authorize a the purpose of providing credit to prevent the
program or facility may not be designed program or facility that sought to evade failure or resolution of any number of specific
these limitations by grouping multiple failing or insolvent persons, and would not allow
to assist ‘‘one or more’’ specific a program or facility designed for the purpose of
failing or insolvent firms in a single preventing the resolution or failure of more than
9 12 U.S.C. 343(3)(A). program or facility. Thus, the revisions five persons.
10 See 12 U.S.C. 343(3)(B)(iii). in the final rule would not permit the 12 124 Stat. 1376 at 2113–15.
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![Federal Register / Vol. 80, No. 243 / Friday, December 18, 2015 / Rules and Regulations 78965
reducing the burden, may be sent to: of any respondents, but for purposes of (d) Emergency credit for others—(1)
Secretary, Board of Governors of the the PRA we will assume 10. If or when Authorization to extend credit. In
Federal Reserve System, 20th and C we receive any certifications we intend unusual and exigent circumstances, the
Streets NW., Washington, DC 20551. A to update this data upon the next Board, by the affirmative vote of not less
copy of the comments may also be renewal of the information collection). than five members,1 may authorize any
submitted to the OMB desk officer (1) by Total Estimated Annual Burden: 50 Federal Reserve Bank, subject to such
mail to U.S. Office of Management and hours. conditions and during such periods as
Budget, 725 17th Street NW., 10235, the Board may determine, to extend
C. Invitation for Comments on Use of
Washington, DC 20503; (2) by facsimile credit to any participant in a program or
Plain Language
to 202–395–6974; or (3) by email to: facility with broad-based eligibility
oira_submission@omb.eop.gov, Section 722 of the Gramm-Leach established and operated in accordance
Attention, Federal Reserve Board Bliley Act of 1999 requires the Federal with this paragraph (d).
Agency Desk Officer. banking agencies to use plain language (2) Approval of the Secretary of the
in all proposed and final rules Treasury. A program or facility may not
Proposed Information Collection published after January 1, 2000.21 The be established under this paragraph (d)
Title of Information Collection: Board received no comments on these without obtaining the prior approval of
Reporting Requirements Associated matters and believes that the final rule the Secretary of the Treasury.
with Regulation A (Extensions of Credit is written plainly and clearly. (3) Disclosure of justification and
by Federal Reserve Banks). terms. As soon as is reasonably
Frequency of Response: Event- List of Subjects in 12 CFR Part 201
practicable, and no later than 7 days
generated. Banks, Banking, Federal Reserve after a program or facility is authorized
Affected Public: Businesses, System, Reporting and recordkeeping under this paragraph (d), the Board and
individuals or other persons. requirements. the authorized Federal Reserve Bank or
Respondents: Any participant in a
Authority and Issuance Federal Reserve Banks, as appropriate,
program or facility with broad-based
will make publicly available a
eligibility. For the reasons set forth in the
Abstract: Sections 1101 and 1103 of description of the program or facility, a
preamble, the Board amends 12 CFR
the Dodd-Frank Act amend the description of the market or sector of the
part 201 (Regulation A) as follows:
emergency lending authorities provided financial system to which the program
in section 13(3) of the Federal Reserve PART 201—EXTENSIONS OF CREDIT or facility is intended to provide
Act. The amendments require the Board, BY FEDERAL RESERVE BANKS liquidity, a description of the unusual
in consultation with the Secretary of the (REGULATION A) and exigent circumstances that exist, the
Treasury, to establish by regulation intended effect of the program or
policies and procedures with respect to ■ 1. The authority citation for part 201 facility, and the terms and conditions
such emergency lending. The purpose of is revised to read as follows: for participation in the program or
the amendments to Regulation A in this Authority: 12 U.S.C. 248(i)–(j) and (s), 343 facility. In addition, within the same
final rule is to implement the Dodd- et seq., 347a, 347b, 347c, 348 et seq., 357, 7-day period, the Board will provide a
Frank Act revisions to the Board’s 374, 374a, and 461. copy of this information to the
emergency lending authority in section Committee on Banking, Housing and
■ 2. Section 201.3 paragraph (b) is
13(3) of the Federal Reserve Act that Urban Affairs of the U.S. Senate and the
revised to read as follows:
limit the use of this authority to the Committee on Financial Services of the
provision of liquidity through broadly- § 201.3 Extensions of credit generally. U.S. House of Representatives.
based facilities for solvent firms in a * * * * * (4) Broad-based eligibility. (i) A
time of crisis. (b) No obligation to make advances or program or facility established under
discounts. This section does not entitle this paragraph (d) must have broad-
Reporting Requirements any person or entity to obtain any credit based eligibility in accordance with
Section 201.4(d)(5)(iv)(A) provides or any increase, renewal or extension of terms established by the Board.
that a Federal Reserve Bank may rely on maturity of any credit from a Federal (ii) For purposes of this paragraph (d),
a written certification from the person Reserve Bank. a program or facility has broad-based
or from the chief executive officer or * * * * * eligibility only if the program or facility
other authorized officer of the entity, at is designed to provide liquidity to an
the time the person or entity initially § 201.109 [Amended] identifiable market or sector of the
borrows under the program or facility, ■ 3. In § 201.109, redesignate footnotes financial system;
that the person or entity is not in 4 through 6 as footnotes 6 through 8. (iii) A program or facility will not be
bankruptcy, resolution under Title II of considered to have broad-based
Public Law 111–203 (12 U.S.C. 5381 et § 201.108 [Amended] eligibility for purposes of this paragraph
seq.) or any other Federal or State ■ 4. In § 201.108, redesignate footnotes (d) if:
insolvency proceeding, and has not 2 and 3 as footnotes 4 and 5. (A) The program or facility is
failed to generally pay its undisputed designed for the purpose of assisting
debts as they become due during the 90 § 201.51 [Amended] one or more specific companies avoid
days preceding the date of borrowing ■ 5. In § 201.51, redesignate footnote 1 bankruptcy, resolution under Title II of
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under the program or facility, and is not as footnote 3. Dodd-Frank Wall Street Reform and
borrowing for the purpose of lending the ■ 6. Section 201.4 paragraph (d) is Consumer Protection Act (Pub. L. 111–
proceeds of the loan to a person or revised to read as follows: 203, 12 U.S.C. 5381 et seq.), or any other
entity that is insolvent. Federal or State insolvency proceeding,
Estimated Burden per Response: 5 § 201.4 Availability and terms of credit. including by removing assets from the
hours. * * * * *
Number of Respondents: 10 (The 1 Unless fewer are authorized pursuant to section
Federal Reserve is not currently aware 21 12 U.S.C. 4809. 11(r) of the Federal Reserve Act. 12 U.S.C. 248(r).
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![Federal Register / Vol. 80, No. 243 / Friday, December 18, 2015 / Rules and Regulations 78967
five members of the Board 2 that without regard to the race, religion, SMALL BUSINESS ADMINISTRATION
unusual and exigent circumstances color, gender, national origin, age or
continue to exist and the program or disability of the vendor or any principal 13 CFR Part 120
facility continues to appropriately shareholder of the vendor, and, to the
provide liquidity to the financial Business Loans
extent possible and consistent with law,
system, and the approval of the shall involve a process designed to CFR Correction
Secretary of the Treasury. support equal opportunity and
(iii) The Board shall make the In Title 13 of the Code of Federal
diversity. Regulations, revised as of January 1,
disclosures required under paragraph
(d)(3) of this section to the public and (13) Short-term emergency credit 2015, on page 307, in § 120.802, in the
the relevant congressional committees secured solely by United States or definition of Priority CDC, remove the
no later than 7 days after renewing a agency obligations. In unusual and first instance of ‘‘504’’ and add ‘‘504’’
program or facility under this paragraph exigent circumstances and after before the word ‘‘program’’.
(d)(9). consultation with the Board, a Federal [FR Doc. 2015–31739 Filed 12–17–15; 8:45 am]
(iv) The Board may at any time Reserve Bank may extend credit under BILLING CODE 1505–01–D
terminate a program or facility section 13(13) of the Federal Reserve
established under this paragraph (d). To Act if the collateral used to secure such
ensure that the program or facility under credit consists solely of obligations of, SMALL BUSINESS ADMINISTRATION
this paragraph (d) is terminated in a or obligations fully guaranteed as to
timely and orderly fashion, the Board 13 CFR Part 136
principal and interest by, the United
will periodically review, no less States or an agency thereof. Prior to Enforcement of Nondiscrimination on
frequently than once every 6 months, extending credit under this paragraph the Basis of Handicap in Programs or
the existence of unusual and exigent (d)(13), the Federal Reserve Bank must Activities Conducted by the Small
circumstances, the extent of usage of the obtain evidence that credit is not Business Administration
program or facility, the extent to which available from other sources and failure
the continuing authorization of the to obtain such credit would adversely CFR Correction
program or facility facilitates restoring affect the economy. Credit extended ■ In Title 13 of the Code of Federal
or sustaining confidence in the
under this paragraph (d)(13) may not be Regulations, revised as of January 1,
identified financial markets, the ongoing
extended for a term exceeding 90 days, 2015, on pages 658 and 659, in
need for the liquidity support provided
must be extended at a rate above the § 136.170, remove ‘‘Director, OEEOC’’
by such program or facility, and such
highest rate in effect for advances to each time it appears in paragraphs (h)(1)
other factors as the Board may deem to
depository institutions as determined in and (j)(1) and (2) and add, in its place,
be appropriate. The Board will
accordance with section 14(d) of the ‘‘AA/EEOCCR’’.
terminate lending under a program or
facility promptly upon finding that Federal Reserve Act, and is subject to [FR Doc. 2015–31740 Filed 12–17–15; 8:45 am]
conditions no longer warrant the such limitations and conditions as BILLING CODE 1505–01–D
continuation of the program or facility provided by the Board.
or that continuation of the program or * * * * *
SMALL BUSINESS ADMINISTRATION
facility is no longer appropriate.
By order of the Board of Governors of the
(v) A program or facility that has been 13 CFR Part 140
Federal Reserve System, November 30, 2015.
terminated will cease extending new
credit and will collect existing loans Robert deV. Frierson,
Debt Collection
pursuant to the applicable terms and Secretary of the Board.
conditions. [FR Doc. 2015–30584 Filed 12–17–15; 8:45 am] CFR Correction
(10) Reporting requirements. The BILLING CODE P In Title 13 of the Code of Federal
Board will comply with the reporting Regulations, revised as of January 1,
requirements of 12 U.S.C. 248(s) and 12 2015, on page 665, in § 140.11, in
U.S.C. 343(3)(C) pursuant to their terms. paragraph (i)(3)(ii), remove the term
(11) No obligation to extend credit. SMALL BUSINESS ADMINISTRATION ‘‘the SBA’’ and add ‘‘the Agency’’ in its
This paragraph (d) does not entitle any place.
person or entity to obtain any credit or 13 CFR Part 105 [FR Doc. 2015–31745 Filed 12–17–15; 8:45 am]
any increase, renewal or extension of
BILLING CODE 1505–01–D
maturity of any credit from a Federal Standards of Conduct and Employee
Reserve Bank. Restrictions and Responsibilities
(12) Participation in programs and
facilities and vendor selection. (i) CFR Correction DEPARTMENT OF TRANSPORTATION
Participation in any program or facility
In Title 13 of the Code of Federal Federal Aviation Administration
under this paragraph (d) shall not be
limited or conditioned on the basis of Regulations, revised as of January 1,
2015, on page 34, in § 105.401, in 14 CFR Part 71
any legally prohibited basis, such as the
race, religion, color, gender, national paragraph (b)(3), remove ‘‘Director of [Docket No. FAA–2015–1139; Airspace
asabaliauskas on DSK5VPTVN1PROD with RULES
origin, age or disability of the borrower. Human Resources’’ and add in its place Docket No. 15–AWP–4]
(ii) The selection of any third-party ‘‘Chief Human Capital Officer’’.
vendor used in the design, marketing or [FR Doc. 2015–31738 Filed 12–17–15; 8:45 am]
Establishment of Class E Airspace;
implementation of any program or Los Angeles, CA
BILLING CODE 1505–01–D
facility under this paragraph (d) shall be AGENCY: Federal Aviation
Administration (FAA), DOT.
2 Unless fewer are authorized pursuant to section
ACTION: Final rule.
11(r) of the Federal Reserve Act. 12 U.S.C. 248(r).
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Document Created: 2015-12-18 01:38:36
Document Modified: 2015-12-18 01:38:36
| 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 | Effective January 1, 2016. | |
| Contact | Laurie S. Schaffer, Associate General Counsel (202) 452-2272, Sophia H. Allison, Special Counsel (202) 452- 3565, or Jay R. Schwarz, Senior Counsel (202) 452-2970, Legal Division. Board of Governors of the Federal Reserve System, 20th Street and Constitution Ave. NW., Washington, DC 20551. For the hearing impaired only, Telecommunications Device for the Deaf (TDD) users may contact (202) 263-4869. | |
| FR Citation | 80 FR 78959 | |
| RIN Number | 7100-AE08 | |
| CFR Associated | Banks; Banking; Federal Reserve System and Reporting and Recordkeeping Requirements |
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