[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 1518 Introduced in Senate (IS)]







105th CONGRESS
  1st Session
                                S. 1518

To require publicly traded corporations to make specific disclosures in 
 their initial offering statements and quarterly reports regarding the 
  ability of their computer systems to operate after January 1, 2000.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           November 10, 1997

  Mr. Bennett introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
To require publicly traded corporations to make specific disclosures in 
 their initial offering statements and quarterly reports regarding the 
  ability of their computer systems to operate after January 1, 2000.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Year 2000 Computer Remediation and 
Shareholder (CRASH) Protection Act of 1997''.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--Congress finds that--
            (1) most computer systems in the United States and around 
        the world are not prepared to operate successfully after 
        January 1, 2000;
            (2) the failure of computer systems to operate correctly 
        after January 1, 2000 threatens the interest of consumers and 
        investors, the financial results of United States corporations, 
        and the continued soundness of the global economy;
            (3) corporations have not provided adequate disclosure on 
        the Year 2000 readiness of their computer systems, the costs of 
        remediation, and their ability to manage the business risks 
        associated with possible computer system problems after January 
        1, 2000;
            (4) corporations may resist making specific disclosures 
        about their management of the ``Year 2000 Problem'' fearing 
        competitive disadvantage; and
            (5) disclosure of Year 2000 readiness by publicly traded 
        corporations will promote the free flow of information on this 
        issue, further the remediation effort, and help business and 
        government leaders avert a potential economic downturn.
    (b) Purposes.--The purposes of this Act are to ensure that--
            (1) publicly traded corporations disclose specific 
        information about the Year 2000 readiness of their computer 
        systems and their ability to manage the business risks 
        associated with possible computer system problems after January 
        1, 2000; and
            (2) the interests of consumers and investors are adequately 
        protected.

SEC. 3. DISCLOSURES.

    (a) Incorporated Definitions.--In this section, the terms 
``Commission'', ``issuer'', and ``security'' have the meanings given 
those terms in section 3 of the Securities Exchange Act of 1934 (15 
U.S.C. 78c).
    (b) Disclosures Required.--Not later than 120 days after the date 
of enactment of this Act, the Commission shall amend the regulations 
promulgated pursuant to section 13 of the Securities Exchange Act of 
1934 (15 U.S.C. 78m) to require each issuer of a security registered 
pursuant to section 12 of that Act (15 U.S.C. 78l) to include, in each 
initial offering statement and in each quarterly report filed with the 
Commission under section 13 of that Act--
            (1) a description of the progress of the issuer in 
        completing the 5 recognized phases of Year 2000 remediation 
        (i.e., awareness, assessment, renovation, validation, and 
        implementation), by division, department, or other appropriate 
        business unit of the issuer;
            (2) a summary of costs incurred by the issuer in connection 
        with any remediation effort described in paragraph (1) and an 
        estimate of additional costs that the issuer expects to incur 
        in connection with future remediation efforts;
            (3) an estimate of anticipated litigation costs and 
        liability outlays associated with the defense of legal actions 
        against the issuer (or the directors or officers of the issuer) 
        as a result of Year 2000 computer system problems, including 
        breach of contract, tort, shareholder class action, and product 
        liability actions;
            (4) information relating to the existence of any insurance 
        policies of the issuer that cover specific Year 2000 computer 
        system problems, as well as the defense of legal actions 
        against the issuer (and the officers and directors of the 
        issuer) in connection with those problems; and
            (5) information relating to any contingency plans developed 
        by the issuer to ensure continued operation of the essential 
        business functions of the issuer in the event of a Year 2000 
        computer system problem by the issuer itself or by a vendor, 
        partner, or other affiliate of the issuer.
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