[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 833 Reported in House (RH)]
Union Calendar No. 66
106th CONGRESS
1st Session
H. R. 833
[Report No. 106-123]
_______________________________________________________________________
A BILL
To amend title 11 of the United States Code, and for other purposes.
_______________________________________________________________________
April 29, 1999
Reported from the Committee on the Judiciary with an amendment
April 29, 1999
Referral to the Committee on Banking and Financial Services extended
for a period ending not later than April 29, 1999
April 29, 1999
Committee on Banking and Financial Services discharged; committed to
the Committee of the Whole House on the State of the Union and ordered
to be printed
Union Calendar No. 66
106th CONGRESS
1st Session
H. R. 833
[Report No. 106-123]
To amend title 11 of the United States Code, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 24, 1999
Mr. Gekas (for himself, Mr. Boucher, Mr. McCollum, Mr. Moran of
Virginia, Mr. Armey, Mr. Frost, Mr. Menendez, Ms. Pryce of Ohio, Mrs.
Fowler, Mr. Kennedy of Rhode Island, Mr. Dreier, Mr. Canady of Florida,
Mr. Goodlatte, Mr. Chabot, Mr. Bryant, Mr. Rothman, Mrs. Bono, Mr.
Andrews, Mr. Baker, Mr. Bereuter, Mr. Cunningham, Mr. Dooley of
California, Ms. Dunn, Ms. Hooley of Oregon, Mrs. Kelly, Mr. Largent,
Mr. Maloney of Connecticut, Mr. Riley, Mr. Roemer, Mr. Sessions, Mr.
Smith of Washington, Mrs. Tauscher, Ms. Velazquez, Mr. Wynn, Mr. Davis
of Virginia, Mr. Davis of Florida, and Mr. Hall of Texas) introduced
the following bill; which was referred to the Committee on the
Judiciary, and in addition to the Committee on Banking and Financial
Services, for a period to be subsequently determined by the Speaker, in
each case for consideration of such provisions as fall within the
jurisdiction of the committee concerned
April 29, 1999
Additional sponsors: Mr. Cook, Mr. Cooksey, Mr. English, Mr. Goode, Mr.
Hill of Montana, Mr. Hilleary, Mr. Metcalf, Mr. Oxley, Mr. Royce, Mr.
Sisisky, Mr. Stump, Mr. Tanner, Mr. Tauzin, Mr. Barton of Texas, Mr.
Buyer, Mrs. Capps, Mr. Ehrlich, Mr. Graham, Mr. Hunter, Mr. Smith of
Michigan, Mr. Strickland, Mr. Sununu, Mr. Talent, Mr. Bliley, Mr.
Burton of Indiana, Mr. Crane, Mr. Hoyer, Mr. Pickett, Mr. Weller, Mr.
Boehner, Mr. Blumenauer, Mr. Foley, Mr. Holden, Mr. Aderholt, Mr.
Jenkins, Mr. Condit, Mr. Cramer, Mr. Deutsch, Mr. Linder, Mrs. Myrick,
Mr. Nethercutt, Mr. Peterson of Pennsylvania, Mr. Terry, Mr. Weldon of
Florida, Mr. Barr of Georgia, Ms. Eddie Bernice Johnson of Texas, Mr.
Kleczka, Mrs. Northup, Mr. Pastor, Ms. Berkley, Mr. Blagojevich, Mr.
Lucas of Kentucky, Mr. Sensenbrenner, Mr. Burr of North Carolina, Mr.
Ney, Mr. Sandlin, Mr. Boyd, Mr. Collins, Mr. Gordon, Mr. McIntosh, Mr.
Scarborough, Mr. Barcia, Mrs. Chenoweth, Mr. Upton, Mr. Camp, Mr.
Simpson, Mr. Castle, Mr. John, Mr. Norwood, and Mr. Sweeney
Deleted sponsor: Mr. Brady of Pennsylvania (added March 23, 1999;
deleted April 28, 1999)
April 29, 1999
Reported from the Committee on the Judiciary with an amendment
[Strike out all after the enacting clause and insert the part printed
in italic]
April 29, 1999
Referral to the Committee on Banking and Financial Services extended
for a period ending not later than April 29, 1999
April 29, 1999
Committee on Banking and Financial Services discharged; committed to
the Committee of the Whole House on the State of the Union and ordered
to be printed
[For text of introduced bill, see copy of bill as introduced on
February 24, 1999]
A BILL
To amend title 11 of the United States Code, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Bankruptcy Reform
Act of 1999''.
(b) Table of Contents.--The table of contents of this Act is as
follows:
Sec. 1. Short title; table of contents.
TITLE I--CONSUMER BANKRUPTCY PROVISIONS
Subtitle A--Needs based bankruptcy
Sec. 101. Conversion.
Sec. 102. Dismissal or conversion.
Sec. 103. Notice of alternatives.
Sec. 104. Debtor financial management training test program.
Subtitle B--Consumer Bankruptcy Protections
Sec. 105. Definitions.
Sec. 106. Enforcement.
Sec. 107. Sense of the congress.
Sec. 108. Discouraging abusive reaffirmation practices.
Sec. 109. Promotion of alternative dispute resolution.
Sec. 110. Enhanced disclosure for credit extensions secured by a
dwelling.
Sec. 111. Dual use debit card.
Sec. 112. Enhanced disclosures under an open-end credit plan.
Sec. 113. Protection of savings earmarked for the postsecondary
education of children.
Sec. 114. Effect of discharge.
Sec. 115. Limiting trustee liability.
Sec. 116. Reinforce the fresh start.
Sec. 117. Discouraging bad faith repeat filings.
Sec. 118. Curbing abusive filings.
Sec. 119. Debtor retention of personal property security.
Sec. 120. Relief from the automatic stay when the debtor does not
complete intended surrender of consumer
debt collateral.
Sec. 121. Giving secured creditors fair treatment in chapter 13.
Sec. 122. Restraining abusive purchases on secured credit.
Sec. 123. Fair valuation of collateral.
Sec. 124. Domiciliary requirements for exemptions.
Sec. 125. Restrictions on certain exempt property obtained through
fraud.
Sec. 126. Rolling stock equipment.
Sec. 127. Discharge under chapter 13.
Sec. 128. Bankruptcy judgeships.
Sec. 129. Additional amendments to title 11, United States Code.
Sec. 130. Amendment to section 1325 of title 11, United States Code.
Sec. 131. Application of the codebtor stay only when the stay protects
the debtor.
Sec. 132. Adequate protection for investors.
Sec. 133. Limitation on luxury goods.
Sec. 134. Giving debtors the ability to keep leased personal property
by assumption.
Sec. 135. Adequate protection of lessors and purchase money secured
creditors.
Sec. 136. Automatic stay.
Sec. 137. Extend period between bankruptcy discharges.
Sec. 138. Definition of domestic support obligation.
Sec. 139. Priorities for claims for domestic support obligations.
Sec. 140. Requirements to obtain confirmation and discharge in cases
involving domestic support obligations.
Sec. 141. Exceptions to automatic stay in domestic support obligation
proceedings.
Sec. 142. Nondischargeability of certain debts for alimony,
maintenance, and support.
Sec. 143. Continued liability of property.
Sec. 144. Protection of domestic support claims against preferential
transfer motions.
Sec. 145. Clarification of meaning of household goods.
Sec. 146. Nondischargeable debts.
Sec. 147. Monetary limitation on certain exempt property.
Sec. 148. Bankruptcy fees.
Sec. 149. Collection of child support.
Sec. 150. Excluding employee benefit plan participant contributions and
other property from the estate.
Sec. 151. Clarification of postpetition wages and benefits.
Sec. 152. Exceptions to automatic stay in domestic support obligation
proceedings.
Sec. 153. Automatic stay inapplicable to certain proceedings against
the debtor.
TITLE II--DISCOURAGING BANKRUPTCY ABUSE
Sec. 201. Reenactment of chapter 12.
Sec. 202. Meetings of creditors and equity security holders.
Sec. 203. Protection of retirement savings in bankruptcy.
Sec. 204. Protection of refinance of security interest.
Sec. 205. Executory contracts and unexpired leases.
Sec. 206. Creditors and equity security holders committees.
Sec. 207. Amendment to section 546 of title 11, United States Code.
Sec. 208. Limitation.
Sec. 209. Amendment to section 330(a) of title 11, United States Code.
Sec. 210. Postpetition disclosure and solicitation.
Sec. 211. Preferences.
Sec. 212. Venue of certain proceedings.
Sec. 213. Period for filing plan under chapter 11.
Sec. 214. Fees arising from certain ownership interests.
Sec. 215. Claims relating to insurance deposits in cases ancillary to
foreign proceedings.
Sec. 216. Defaults based on nonmonetary obligations.
Sec. 217. Sharing of compensation.
Sec. 218. Priority for administrative expenses.
TITLE III--GENERAL BUSINESS BANKRUPTCY PROVISIONS
Sec. 301. Definition of disinterested person.
Sec. 302. Miscellaneous improvements.
Sec. 303. Extensions.
Sec. 304. Local filing of bankruptcy cases.
Sec. 305. Permitting assumption of contracts.
TITLE IV SMALL BUSINESS BANKRUPTCY PROVISIONS
Sec. 401. Flexible rules for disclosure Statement and plan.
Sec. 402. Definitions.
Sec. 403. Standard form disclosure Statement and plan.
Sec. 404. Uniform national reporting requirements.
Sec. 405. Uniform reporting rules and forms for small business cases.
Sec. 406. Duties in small business cases.
Sec. 407. Plan filing and confirmation deadlines.
Sec. 408. Plan confirmation deadline.
Sec. 409. Prohibition against extension of time.
Sec. 410. Duties of the United States trustee.
Sec. 411. Scheduling conferences.
Sec. 412. Serial filer provisions.
Sec. 413. Expanded grounds for dismissal or conversion and appointment
of trustee or examiner.
Sec. 414. Study of operation of title 11 of the United States Code with
respect to small businesses.
Sec. 415. Payment of interest.
TITLE V--MUNICIPAL BANKRUPTCY PROVISIONS
Sec. 501. Petition and proceedings related to petition.
Sec. 502. Applicability of other sections to chapter 9.
TITLE VI--STREAMLINING THE BANKRUPTCY SYSTEM
Sec. 601. Creditor representation at first meeting of creditors.
Sec. 602. Audit procedures.
Sec. 603. Giving creditors fair notice in chapter 7 and 13 cases.
Sec. 604. Dismissal for failure to timely file schedules or provide
required information.
Sec. 605. Adequate time to prepare for hearing on confirmation of the
plan.
Sec. 606. Chapter 13 plans to have a 5-year duration in certain cases.
Sec. 607. Sense of the Congress regarding expansion of rule 9011 of the
Federal Rules of Bankruptcy Procedure.
Sec. 608. Elimination of certain fees payable in chapter 11 bankruptcy
cases.
Sec. 609. Study of bankruptcy impact of credit extended to dependent
students.
Sec. 610. Prompt relief from stay in individual cases.
Sec. 611. Stopping abusive conversions from chapter 13.
Sec. 612. Bankruptcy appeals.
Sec. 613. GAO study.
TITLE VII--BANKRUPTCY DATA
Sec. 701. Improved bankruptcy statistics.
Sec. 702. Uniform rules for the collection of bankruptcy data.
Sec. 703. Sense of the Congress regarding availability of bankruptcy
data.
TITLE VIII--BANKRUPTCY TAX PROVISIONS
Sec. 801. Treatment of certain liens.
Sec. 802. Effective notice to government.
Sec. 803. Notice of request for a determination of taxes.
Sec. 804. Rate of interest on tax claims.
Sec. 805. Tolling of priority of tax claim time periods.
Sec. 806. Priority property taxes incurred.
Sec. 807. Chapter 13 discharge of fraudulent and other taxes.
Sec. 808. Chapter 11 discharge of fraudulent taxes.
Sec. 809. Stay of tax proceedings.
Sec. 810. Periodic payment of taxes in chapter 11 cases.
Sec. 811. Avoidance of statutory tax liens prohibited.
Sec. 812. Payment of taxes in the conduct of business.
Sec. 813. Tardily filed priority tax claims.
Sec. 814. Income tax returns prepared by tax authorities.
Sec. 815. Discharge of the estate's liability for unpaid taxes.
Sec. 816. Requirement to file tax returns to confirm chapter 13 plans.
Sec. 817. Standards for tax disclosure.
Sec. 818. Setoff of tax refunds.
TITLE IX--ANCILLARY AND OTHER CROSS-BORDER CASES
Sec. 901. Amendment to add chapter 15 to title 11, United States Code.
Sec. 902. Amendments to other chapters in title 11, United States Code.
TITLE X--FINANCIAL CONTRACT PROVISIONS
Sec. 1001. Treatment of certain agreements by conservators or --
receivers of insured depository
institutions.
Sec. 1002. Authority of the corporation with respect to failed and
failing institutions.
Sec. 1003. Amendments relating to transfers of qualified financial
contracts.
Sec. 1004. Amendments relating to disaffirmance or repudiation of
qualified financial contracts.
Sec. 1005. Clarifying amendment relating to master agreements.
Sec. 1006. Federal Deposit Insurance Corporation Improvement Act of
1991.
Sec. 1007. Bankruptcy Code amendments.
Sec. 1008. Recordkeeping requirements.
Sec. 1009. Exemptions from contemporaneous execution ---requirement.
Sec. 1010. Damage measure.
Sec. 1011. Sipc stay.
Sec. 1012. Asset-backed securitizations.
Sec. 1013. Federal Reserve collateral requirements.
Sec. 1014. Effective date; application of ---amendments.
TITLE XI--TECHNICAL CORRECTIONS
Sec. 1101. Definitions.
Sec. 1102. Adjustment of dollar amounts.
Sec. 1103. Extension of time.
Sec. 1104. Technical amendments.
Sec. 1105. Penalty for persons who negligently or fraudulently prepare
bankruptcy petitions.
Sec. 1106. Limitation on compensation of professional persons.
Sec. 1107. Special tax provisions.
Sec. 1108. Effect of conversion.
Sec. 1109. Allowance of administrative expenses.
Sec. 1110. Priorities.
Sec. 1111. Exemptions.
Sec. 1112. Exceptions to discharge.
Sec. 1113. Effect of discharge.
Sec. 1114. Protection against discriminatory treatment.
Sec. 1115. Property of the estate.
Sec. 1116. Preferences.
Sec. 1117. Postpetition transactions.
Sec. 1118. Disposition of property of the estate.
Sec. 1119. General provisions.
Sec. 1120. Appointment of elected trustee.
Sec. 1121. Abandonment of railroad line.
Sec. 1122. Contents of plan.
Sec. 1123. Discharge under chapter 12.
Sec. 1124. Bankruptcy cases and proceedings.
Sec. 1125. Knowing disregard of bankruptcy law or rule.
Sec. 1126. Transfers made by nonprofit charitable corporations.
Sec. 1127. Prohibition on certain actions for failure to incur finance
charges.
Sec. 1128. Protection of valid purchase money security interests.
Sec. 1129. Trustees.
TITLE XII--GENERAL EFFECTIVE DATE; APPLICATION OF AMENDMENTS
Sec. 1201. Effective date; application of amendments.
TITLE I--CONSUMER BANKRUPTCY PROVISIONS
Subtitle A--Needs based bankruptcy
SEC. 101. CONVERSION.
Section 706(c) of title 11, United States Code, is amended by
inserting ``or consents to'' after ``requests''.
SEC. 102. DISMISSAL OR CONVERSION.
(a) In General.--Section 707 of title 11, United States Code, is
amended--
(1) by striking the section heading and inserting the
following:
``Sec. 707. Dismissal of a case or conversion to a case under chapter
13'';
and
(2) in subsection (b)--
(A) by inserting ``(1)'' after ``(b)''; and
(B) in paragraph (1), as redesignated by
subparagraph (A) of this paragraph--
(i) in the first sentence--
(I) by striking ``but not at the
request or suggestion of'' and
inserting ``the trustee, or'';
(II) by inserting ``, or, with the
debtor's consent, convert such a case
to a case under chapter 13 of this
title,'' after ``consumer debts''; and
(III) by striking ``substantial
abuse'' and inserting ``abuse''; and
(ii) by striking the second and third
sentences and inserting the following:
``(2)(A)(i) In considering under paragraph (1) whether the granting
of relief would be an abuse of the provisions of this chapter, the
court shall presume abuse exists if the debtor's current monthly income
less estimated administrative expenses and reasonable attorneys' fees,
and amounts set forth in clauses (ii) for monthly expenses (which shall
include, if applicable, the continuation of actual expenses of a
dependent child under the age of 18 for tuition, books, and required
fees at a private elementary or secondary school, not exceeding $10,000
per year, which amount shall be adjusted pursuant to section 104(b)),
(iii) for monthly payments on account of secured debts, and (iv) for
monthly unsecured priority debt payments, and multiplied by 60 months
is not less than $6,000.
``(ii) The debtor's monthly expenses shall be the debtor's
applicable monthly expense amounts specified under the National
Standards and Local Standards, and the debtor's applicable monthly
expenses for the categories specifically listed as Other Necessary
Expenses issued by the Internal Revenue Service for the area in which
the debtor resides, as in effect on the date of the entry of the order
for relief, for the debtor, the dependents of the debtor, and the
spouse of the debtor in a joint case, if the spouse is not otherwise a
dependent. In addition, if it is demonstrated that it is reasonable and
necessary, the debtor may also subtract an allowance of up to 5% of the
food and clothing categories as specified by the National Standards
issued by the Internal Revenue Service. Notwithstanding any other
provision of this clause, the debtor's monthly expenses shall not
include any payments for debts.
``(iii) The debtor's average monthly payments on account of secured
debts shall be calculated as the total of all amounts scheduled as
contractually due to secured creditors in each month of the 60 months
following the date of the petition, and dividing that total by 60
months.
``(iv) The debtor's monthly unsecured priority debt payments
(including payments for priority child support and alimony claims)
shall be calculated as the total amount of unsecured debts entitled to
priority, and dividing the total by 60 months.
``(v) For the purposes of this subsection, a family or household
shall consist of the debtor, the debtor's spouse, and the debtor's
dependents, but not a legally separated spouse unless the spouse files
a joint case with the debtor.
``(B) In any proceeding brought under this subsection, the
presumption of abuse may be rebutted only by demonstrating
extraordinary circumstances that require additional expenses or
adjustment of current monthly income. In order to establish
extraordinary circumstances, the debtor must itemize each additional
expense or adjustment of income and provide documentation for such
expenses or adjustment of income and a detailed explanation of the
extraordinary circumstances which make such expenses or adjustment of
income necessary and reasonable. The debtor shall attest under oath to
the accuracy of any information provided to demonstrate that additional
expenses or adjustment to income are required. The presumption of abuse
may be rebutted only if such additional expenses or adjustments to
income cause the debtor's current monthly income less estimated
administrative expenses and reasonable attorneys' fees, and the amounts
set forth in clauses (ii), (iii), and (iv) of subparagraph (A) when
multiplied by 60 to be less than $6,000.
``(C) As part of the schedule of current income and expenditures
required under section 521 of this title, the debtor shall include a
statement of the debtor's current monthly income, and the calculations
which determine whether a presumption arises under subparagraph (A)(i),
showing how each amount is calculated. The bankruptcy rules promulgated
under section 2075 of title 28, United States Code, shall prescribe a
form for such statement and may provide general rules on its content.
``(D) No judge, United States trustee, panel trustee, bankruptcy
administrator or other party in interest shall bring a motion under
this paragraph if the debtor and the debtor's spouse combined, as of
the date of the order for relief, have current monthly total income
equal to or less than the regional median household monthly income
calculated on a semiannual basis for a household of equal size.
However, for a household of more than 4 individuals, the median income
shall be that of a household of 4 individuals plus $583 for each
additional member of that household.
``(3) In considering under paragraph (1) whether the granting of
relief would be an abuse of the provisions of this chapter in a case in
which the presumption in paragraph (2)(A)(i) does not apply or has been
rebutted, the court shall consider--
``(A) whether the debtor filed the petition in bad faith;
or
``(B) the totality of the circumstances (including whether
the debtor seeks to reject a personal services contract and the
financial need for such rejection as sought by the debtor) of
the debtor's financial situation demonstrates abuse.
``(4)(A) If a panel trustee appointed under section 586(a)(1) of
title 28 or bankruptcy administrator brings a motion for dismissal or
conversion under this subsection and the court grants that motion and
finds that the action of the counsel for the debtor in filing under
this chapter violated Rule 9011, the court shall assess damages which
may include ordering:
``(i) the counsel for the debtor to reimburse the trustee
for all reasonable costs in prosecuting the motion, including
reasonable attorneys' fees.
``(ii) the assessment of an appropriate civil penalty
against the counsel for the debtor; and
``(iii) the payment of the civil penalty to the panel
trustee, bankruptcy administrator or the United States trustee.
``(B) In the case of a petition filed under sections 301, 302, or
303 of this title and supporting lists, schedules and documents filed
under section 521(a)(1) of this title, the signature of an attorney on
the petition shall constitute a certificate that the attorney has--
``(i) performed a reasonable investigation into the
circumstances that gave rise to the petition; and
``(ii) determined that the petition, lists, schedules, and
documents--
``(I) are well grounded in fact; and
``(II) are warranted by existing law or a good
faith argument for the extension, modification, or
reversal of existing law and do not constitute an abuse
under paragraph (1) of this subsection.
``(5) The court may award a debtor all reasonable costs in
contesting a motion filed by a party in interest (not including a
trustee or the United States trustee) under this subsection (including
reasonable attorneys' fees) if--
``(A) the court does not grant the motion; and
``(B) the court finds that--
``(i) the position of the party that brought the
motion was not substantially justified; or
``(ii) the party brought the motion solely for the
purpose of coercing a debtor into waiving a right
guaranteed to the debtor under this title.
``(6) However, only the court, the United States trustee, or the
trustee may file a motion to dismiss or convert a case under this
subsection if the current monthly income of the debtor and the debtor's
spouse combined, as of the date of the order for relief, when
multiplied by 12, is less than the highest national median family
income last reported by the Bureau of the Census for a family of equal
or lesser size, or in the case of a household of 1 person, the national
median household income for 1 earner. Notwithstanding the foregoing,
the national median family income for a family of more than 4
individuals shall be the national median family income last reported by
the Bureau of the Census for a family of 4 individuals plus $583 for
each additional member of the family.
``(7) In making a determination whether to dismiss a case under
this section, the court may not take into consideration whether a
debtor has made, or continues to make, charitable contributions (that
meet the definition of `charitable contribution' under section
548(d)(3)) to any qualified religious or charitable entity or
organization (as that term is defined in section 548(d)(4)).
``(8) Not later than 3 years after the date of enactment of the
Bankruptcy Reform Act of 1999, the Director of the Executive Office for
United States Trustees shall submit a report, to the Committee on the
Judiciary of the House of Representatives and the Committee on the
Judiciary of the Senate, containing its findings regarding the
utilization of the Internal Revenue Service standards for determining
the current monthly expenses under section 707(b)(1)(A)(ii) of title
11, United States Code, of debtors and the impact that the application
of such standards has had on debtors and on the bankruptcy courts. Such
report may include recommendations for amendments to such title,
consistent with the Director's findings.''.
(b) Definitions.--Section 101 of title 11, United States Code, is
amended--
(1) by inserting after paragraph (10) the following:
``(10A) `current monthly income' means the average monthly
income from all sources derived which the debtor, or in a joint
case, the debtor and the debtor's spouse, receive without
regard to whether it is taxable income, in the 180 days
preceding the date of determination, and includes any amount
paid by anyone other than the debtor or, in a joint case, the
debtor and the debtor's spouse, on a regular basis to the
household expenses of the debtor or the debtor's dependents
and, in a joint case, the debtor's spouse if not otherwise a
dependent, but excludes payments to victims of war crimes or
crimes against humanity;''; and
(2) by inserting after paragraph (17) the following:
``(17A) `estimated administrative expenses and reasonable
attorneys' fees' means 10 percent of projected payments under a
chapter 13 plan;''.
(c) Administrative Provisions.--Section 704 of title 11, United
States Code, is amended--
(1) in paragraph (8) by striking ``and'' at the end;
(2) in paragraph (9) by striking the period at the end and
inserting ``; and''; and
(3) by adding at the end the following:
``(10)(A) With respect to an individual debtor, the trustee
shall review all materials filed by the debtor, consider all
information presented at the first meeting of creditors, and
within 10 days after the first meeting of creditors file with
the court a statement as to whether the debtor's case should be
presumed to be an abuse under section 707(b) of this title. The
court shall provide a copy of such statement to all creditors
within 5 days after such statement is filed. If, based on the
filing of such statement with the court, the trustee determines
that the debtor's case should be presumed to be an abuse under
section 707(b) of this title and if the current monthly income
of the debtor and the debtor's spouse combined, as of the date
of the order for relief, when multiplied by 12, is not less
than the highest national median family income reported for a
family of equal or lesser size, or in the case of a household
of 1 person, the national median household income for 1 earner,
then the trustee shall within 30 days of the filing of such
statement, either--
``(i) file a motion to dismiss or convert under
section 707(b) of this title; or
``(ii) file a statement setting forth the reasons
the trustee or bankruptcy administrator does not
believe that such a motion would be appropriate.
``(B) Notwithstanding subparagraph (A), for purposes of
this paragraph the national family income for a family of more
than 4 individuals shall be the national median family income
last reported by the Bureau of the Census for a family of 4
individuals plus $583 for each additional member of the family.''.
(d) Clerical Amendment.--The table of sections at the beginning of
chapter 7 of title 11, United States Code, is amended by striking the
item relating to section 707 and inserting the following:
``707. Dismissal of a case or conversion to a case under chapter 13.''.
SEC. 103. NOTICE OF ALTERNATIVES.
Section 342(b) of title 11, United States Code, is amended to read
as follows:
``(b) Before the commencement of a case under this title by an
individual whose debts are primarily consumer debts, the clerk shall
give to such individual written notice containing--
``(1) a brief description of--
``(A) chapters 7, 11, 12, and 13 and the general
purpose, benefits, and costs of proceeding under each
of those chapters; and
``(B) the types of services available from credit
counseling agencies; and
``(2) statements specifying that--
``(A) a person who knowingly and fraudulently
conceals assets or makes a false oath or statement
under penalty of perjury in connection with a
bankruptcy case shall be subject to fine, imprisonment,
or both; and
``(B) all information supplied by a debtor in
connection with a bankruptcy case is subject to
examination by the Attorney General.''.
SEC. 104. DEBTOR FINANCIAL MANAGEMENT TRAINING TEST PROGRAM.
(a) Development of Financial Management and Training Curriculum and
Materials.--The Director of the Executive Office for United States
Trustees (in this section referred to as the ``Director'') shall
consult with a wide range of individuals who are experts in the field
of debtor education, including trustees who are appointed under chapter
13 of title 11 of the United States Code and who operate financial
management education programs for debtors, and shall develop a
financial management training curriculum and materials that can be used
to educate individual debtors on how to better manage their finances.
(b) Test--(1) The Director shall select 6 judicial districts of the
United States in which to test the effectiveness of the financial
management training curriculum and materials developed under subsection
(a).
(2) For a 18-month period beginning not later than 270 days after
the date of the enactment of this Act, such curriculum and materials
shall be, for the 6 judicial districts selected under paragraph (1),
used as the instructional course concerning personal financial
management for purposes of section 111 of this title.
(c) Evaluation.--(1) During the 1-year period referred to in
subsection (b), the Director shall evaluate the effectiveness of--
(A) the financial management training curriculum and
materials developed under subsection (a); and
(B) a sample of existing consumer education programs such
as those described in the Report of the National Bankruptcy
Review Commission (October 20, 1997) that are representative of
consumer education programs carried out by the credit industry,
by trustees serving under chapter 13 of title 11 of the United
States Code, and by consumer counselling groups.
(2) Not later than 3 months after concluding such evaluation, the
Director shall submit a report to the Speaker of the House of
Representatives and the President pro tempore of the Senate, for
referral to the appropriate committees of the Congress, containing the
findings of the Director regarding the effectiveness of such
curriculum, such materials, and such programs and their costs.
Subtitle B--Consumer Bankruptcy Protections
SEC. 105. DEFINITIONS.
(a) Definitions.--Section 101 of title 11, United States Code, is
amended--
(1) by inserting after paragraph (2) the following:
``(3) `assisted person' means any person whose debts
consist primarily of consumer debts and whose non-exempt assets
are less than $150,000;'';
(2) by inserting after paragraph (4) the following:
``(4A) `bankruptcy assistance' means any goods or services
sold or otherwise provided to an assisted person with the
express or implied purpose of providing information, advice,
counsel, document preparation or filing, or attendance at a
creditors' meeting or appearing in a proceeding on behalf of
another or providing legal representation with respect to a
proceeding under this title;''; and
(3) by inserting after paragraph (12A) the following:
``(12B) `debt relief agency' means any person who provides
any bankruptcy assistance to an assisted person in return for
the payment of money or other valuable consideration, or who is
a bankruptcy petition preparer pursuant to section 110 of this
title, but does not include any person that is any of the
following or an officer, director, employee or agent thereof--
``(A) any nonprofit organization which is exempt
from taxation under section 501(c)(3) of the Internal
Revenue Code of 1986;
``(B) any creditor of the person to the extent the
creditor is assisting the person to restructure any
debt owed by the person to the creditor; or
``(C) any depository institution (as defined in
section 3 of the Federal Deposit Insurance Act) or any
Federal credit union or State credit union (as those
terms are defined in section 101 of the Federal Credit
Union Act), or any affiliate or subsidiary of such a
depository institution or credit union;''.
(b) Conforming Amendment.--In section 104(b)(1) by inserting
``101(3),'' after ``sections''.
SEC. 106. ENFORCEMENT.
(a) Enforcement.--Subchapter II of chapter 5 of title 11, United
States Code, is amended by adding at the end the following:
``Sec. 526. Debt relief agency enforcement
``(a) A debt relief agency shall not--
``(1) fail to perform any service which the debt relief
agency has told the assisted person or prospective assisted
person the agency would provide that person in connection with
the preparation for or activities during a proceeding under
this title;
``(2) make any statement, or counsel or advise any assisted
person to make any statement in any document filed in a
proceeding under this title, which is untrue and misleading or
which upon the exercise of reasonable care, should be known by
the debt relief agency to be untrue or misleading;
``(3) misrepresent to any assisted person or prospective
assisted person, directly or indirectly, affirmatively or by
material omission, what services the debt relief agency can
reasonably expect to provide that person, or the benefits an
assisted person may obtain or the difficulties the person may
experience if the person seeks relief in a proceeding pursuant
to this title; or
``(4) advise an assisted person or prospective assisted
person to incur more debt in contemplation of that person
filing a proceeding under this title or in order to pay an
attorney or bankruptcy petition preparer fee or charge for
services performed as part of preparing for or representing a
debtor in a proceeding under this title.''.
``(b) Assisted Person Waivers Invalid.--Any waiver by any assisted
person of any protection or right provided by or under this section
shall not be enforceable against the debtor by any Federal or State
court or any other person, but may be enforced against a debt relief
agency.
``(c) Noncompliance.--
``(1) Any contract between a debt relief agency and an
assisted person for bankruptcy assistance which does not comply
with the material requirements of this section shall be treated
as void and may not be enforced by any Federal or State court
or by any other person.
``(2) Any debt relief agency shall be liable to an assisted
person in the amount of any fees or charges in connection with
providing bankruptcy assistance to such person which the debt
relief agency has received, for actual damages, and for
reasonable attorneys' fees and costs if the debt relief agency
is found, after notice and hearing, to have--
``(A) intentionally or negligently failed to comply
with any provision of this section with respect to a
bankruptcy case or related proceeding of the assisted
person;
``(B) provided bankruptcy assistance to an assisted
person in a case or related proceeding which is
dismissed or converted because of the debt relief
agency's intentional or negligent failure to file
bankruptcy papers, including papers specified in
section 521 of this title; or
``(C) intentionally or negligently disregarded the
material requirements of this title or the Federal
Rules of Bankruptcy Procedure applicable to such debt
relief agency.
``(3) In addition to such other remedies as are provided
under State law, whenever the chief law enforcement officer of
a State, or an official or agency designated by a State, has
reason to believe that any person has violated or is violating
this section, the State--
``(A) may bring an action to enjoin such violation;
``(B) may bring an action on behalf of its
residents to recover the actual damages of assisted
persons arising from such violation, including any
liability under paragraph (2); and
``(C) in the case of any successful action under
subparagraph (A) or (B), shall be awarded the costs of
the action and reasonable attorney fees as determined
by the court.
``(4) The United States District Court for any district
located in the State shall have concurrent jurisdiction of any
action under subparagraph (A) or (B) of paragraph (3).
``(5) Notwithstanding any other provision of Federal law
and in addition to any other remedy provided under Federal or
State law, if the court, on its own motion or on the motion of
the United States trustee or the debtor, finds that a person
intentionally violated this section, or engaged in a clear and
consistent pattern or practice of violating this section, the
court may--
``(A) enjoin the violation of such section; or
``(B) impose an appropriate civil penalty against
such person.
``(c) Relation to State Law.--This section shall not annul, alter,
affect or exempt any person subject to those sections from complying
with any law of any State except to the extent that such law is
inconsistent with those sections, and then only to the extent of the
inconsistency.''.
(b) Conforming Amendment.--The table of sections for chapter 5 of
title 11, United States Code, is amended by inserting after the item
relating to section 527, the following:
``526. Debt relief agency enforcement.''.
SEC. 107. SENSE OF THE CONGRESS.
It is the sense of the Congress that States should develop
curricula relating to the subject of personal finance, designed for use
in elementary and secondary schools.
SEC. 108. DISCOURAGING ABUSIVE REAFFIRMATION PRACTICES.
Section 524 of title 11, United States Code, is amended--
(1) in subsection (c)--
(A) in paragraph (2)--
(i) in subparagraph (A) by striking ``and''
at the end;
(ii) in subparagraph (B) by adding ``and''
at the end; and
(iii) by adding at the end the following:
``(C) if the consideration for such agreement is based on a
wholly unsecured consumer debt (except for debts owed to
creditors defined in section 461(b)(1)(A)(iv) of title 12,
United States Code), such agreement contains a clear and
conspicuous statement which advises the debtor--
``(i) that the debtor is entitled to a hearing
before the court at which the debtor shall appear in
person and at which the court will decide whether the
agreement is an undue hardship, not in the debtor's
best interest, and not the result of a threat by the
creditor to take any action that cannot be legally
taken or that is not intended to be taken; and
``(ii) that if the debtor is represented by
counsel, the debtor may waive the debtor's right to
such a hearing by signing a statement waiving the
hearing, stating that the debtor is represented by
counsel, and identifying such counsel;''; and
(B) in paragraph (6)(A)--
(i) by striking ``and'' at the end of
clause (i);
(ii) by striking the period at the end of
clause (ii) and inserting ``; and''; and
(iii) by adding at the end thereof the
following:
``(iii) not entered into by the debtor as the
result of a threat by the creditor to take any action
that cannot be legally taken or that is not intended to
be taken.''; and
(2) in the 3d sentence of subsection (d)--
(A) by striking ``of this section'' and inserting a
comma; and
(B) by inserting after ``such agreement'' the
following:
``or if the consideration for such agreement is based on a wholly
unsecured consumer debt (except for debts owed to creditors defined in
section 461(b)(1)(A)(iv) of title 12, United States Code) and the
debtor has not waived the debtor's right to a hearing on the agreement
in accordance with subsection (c)(2)(C) of this section''.
SEC. 109. PROMOTION OF ALTERNATIVE DISPUTE RESOLUTION.
(a) Reduction of Claim.--Section 502 of title 11, United States
Code, is amended by adding at the end the following:
``(k)(1) The court, on the motion of the debtor and after a
hearing, may reduce a claim filed under this section based wholly on
unsecured consumer debts by not more than 20 percent, if the debtor can
prove by clear and convincing evidence that the claim was filed by a
creditor who unreasonably refused to negotiate a reasonable alternative
repayment schedule proposed by an approved credit counseling agency
acting on behalf of the debtor, and if--
``(A) such offer was made within the period beginning 60
days before the filing of the petition;
``(B) such offer provided for payment of at least 60
percent of the amount of the debt over a period not to exceed
the repayment period of the loan, or a reasonable extension
thereof; and
``(C) no part of the debt under the alternative repayment
schedule is nondischargeable, is entitled to priority under
section 507 of this title, or would be paid a greater
percentage in a chapter 13 proceeding than offered by the
debtor.
``(2) The debtor shall have the burden of proving that the proposed
alternative repayment schedule was made in the 60-day period specified
in subparagraph (A) and that the creditor unreasonably refused to
consider the debtor's proposal.''.
(b) Limitation on Avoidability.--Section 547 of title 11, United
States Code, is amended by adding at the end the following:
``(h) The trustee may not avoid a transfer if such transfer was
made as a part of an alternative repayment plan between the debtor and
any creditor of the debtor created by an approved credit counseling
agency.''.
SEC. 110. ENHANCED DISCLOSURE FOR CREDIT EXTENSIONS SECURED BY A
DWELLING.
(a) Study Required.--During the period beginning 180 days after the
date of enactment of this Act and ending 18 months after the date of
the enactment, the Board of Governors of the Federal Reserve System (in
this section referred to as the ``Board'') shall conduct a study and
submit to Congress a report (including recommendations for any
appropriate legislation) regarding--
(1) whether a consumer engaging in an open-end credit
transaction (as defined pursuant to section 103 of the Truth in
lending Act) secured by the consumer's principal dwelling is
provided adequate information under Federal law, including
under section 127A of the Truth in Lending Act, regarding the
tax deductibility of interest paid on such transaction; and
(2) whether a consumer engaging in a closed-end credit
transaction (as defined pursuant to section 103 of the Truth in
Lending Act) secured by the consumer's principal dwelling is
provided adequate information regarding the tax deductibility
of interest paid on such transaction.
In conducting such study, the Board shall specifically consider whether
additional disclosures are necessary with respect to such open-end or
closed-end credit transactions in which the amount of the credit
extended exceeds the fair market value of the dwelling.
(b) Regulations.--If the Board determines that additional
disclosures are necessary in connection with transactions described in
subsection (a), the Board, pursuant to its authority under the Truth in
Lending Act, may promulgate regulations that would require such
additional disclosures. Any such regulations promulgated by the Board
under this section shall not take effect before the end of the 36-month
period after the date of the enactment of this Act.
SEC. 111. DUAL USE DEBIT CARD.
(a) Study Required.--The Board of Governors of the Federal Reserve
System (in this section referred to as the ``Board'') shall conduct a
study of existing protections provided to consumers to limit their
liability for unauthorized use of a debit card or similar access
device.
(b) Specific Considerations.--In conducting the study required by
subsection (a), the Board shall specifically consider the following--
(1) the extent to which existing provisions of section 909
of the Electronic Fund Transfer Act and the Board's
implementing regulations provide adequate unauthorized use
liability protection for consumers;
(2) the extent to which any voluntary industry rules have
enhanced the level of protection afforded consumers in
connection with such unauthorized use liability; and
(3) whether amendments to the Electronic Funds Transfer Act
or the Board's implementing regulations thereto are necessary
to provide adequate protection for consumers in this area.
(c) Report and Regulations.--Not later than 2 years after the date
of the enactment of this Act, the Board shall make public a report on
its findings with respect to the adequacy of existing protections
afforded consumers with respect to unauthorized-use liability for debit
cards and similar access devices. If the Board determines that such
protections are inadequate, the Board, pursuant to its authority under
the Electronic Funds Transfer Act, may issue regulations to address
such inadequacy. Any regulations issued by the Board shall not be
effective before 36 months after the date of the enactment of this Act.
SEC. 112. ENHANCED DISCLOSURES UNDER AN OPEN-END CREDIT PLAN.
(a) Initial and Annual Minimum Payment Disclosure.--Section 127(a)
of the Truth in Lending Act (15 U.S.C. 1637(a)) is amended by adding at
the end the following:
``(9) In the case of any credit or charge card account
under an open-end consumer credit plan on which a minimum
monthly or periodic payment will be required, other than an
account described in paragraph (8)--
``(A) the following statement: `The minimum payment
amount shown on your billing statement is the smallest
payment which you can make in order to keep the account
in good standing. This payment option is offered as a
convenience and you may make larger payments at any
time. Making only the minimum payment each month will
increase the amount of interest you pay and the length
of time it takes to repay your outstanding balance.';
``(B) if the plan provides that the consumer will
be permitted to forgo making a minimum payment during a
specified billing cycle, a statement, if applicable,
that if the consumer chooses to forgo making the
minimum payment, finance charges will continue to
accrue; and
``(C) an example, based on an annual percentage
rate and method for determining minimum periodic
payments recently in effect for that creditor, and a
$500 outstanding balance, showing the estimated minimum
periodic payment, and the estimated period of time it
would take to repay the $500 outstanding balance if the
consumer paid only the minimum periodic payment on each
monthly or periodic statement and obtained no
additional extensions of credit.
``(10) With respect to one billing cycle per calendar year,
the creditor shall transmit the information required under
paragraph (9) to each consumer to whom the creditor is required
to transit a statement pursuant to subsection (b) for such
billing cycle. The creditor shall also transmit to such
consumer for such cycle a worksheet prescribed by the Board to
assist the consumer in determining the consumer's household
income and debt obligations.''.
(b) Periodic Minimum Payment Disclosures.--Section 127(b) of the
Truth in Lending Act (15 U.S.C. 1637(b)) is amended by adding at the
end the following:
``(11) The following statement: `The minimum payment amount
shown on your billing statement is the smallest payment which
you can make in order to keep the account in good standing.
This payment option is offered as a convenience and you may
make larger payments at any time. Making only the minimum
payment each month will increase the amount of interest you pay
and the length of time it takes to repay your outstanding
balance.'''.
(c) Enforcement.--Section 127 of the Truth in Lending Act (15
U.S.C. 1637) is amended by adding at the end the following:
``(h) In promulgating regulations to implement the disclosure of an
example required under subsection (a)(9)(C) and (a)(10), the Board
shall set forth a model disclosure to accompany the example stating
that the credit features shown are only an example which does not
obligate the creditor, but is intended to illustrate the approximate
length of time it could take to repay using the assumptions set forth
in subsection (a)(9)(C) without regard to any other factors that could
impact an approximate repayment period, including other credit features
or the consumer's payment or other behavior with respect to the
account. Compliance with the disclosures required under subsection
(a)(9)(C) and (a)(10) shall be enforced exclusively by the Federal
agencies set forth in section 108.''.
(d) Regulatory Implementation.--The Board of Governors of the
Federal Reserve System (in this section referred to as the ``Board'')
shall promulgate regulations implementing the amendments made by
subsections (a) and (b). Such regulations shall take effect no earlier
than the end of the 36-month period beginning on the date of the
enactment of this Act.
(e) Study Required.--The Board shall conduct a study to determine
whether consumers have adequate information about borrowing activities
which may result in financial problems. In studying this issue, the
Board shall consider the extent to which--
(1) consumers, in establishing new credit arrangements, are
aware of their existing payment obligations, the need to
consider those obligations in deciding to take on new credit,
and how taking on excessive credit can result in financial
difficulty;
(2) minimum periodic payment features offered in connection
with open-end credit plans impact consumer default rates;
(3) consumers always make only the minimum payment
throughout the life of the plan;
(4) consumers are aware that making only minimum payments
will increase the cost and repayment period of an open-end
loan; and
(5) the availability of low minimum payment options is a
cause of consumers experiencing financial difficulty.
(f) Report to Congress.--Before the end of the 2-year period
beginning on the date of the enactment of this Act, the Board shall
submit to Congress a report containing the findings of the Board in
connection with the study required under subsection (e).
(g) Regulations.--The Board shall, by regulation promulgated
pursuant to its authority under the Truth in Lending Act, require
additional disclosures to consumers regarding minimum payment features,
including periodic statement disclosures, if the Board determines that
such disclosures are necessary based on its findings. Any such
regulations promulgated by the Board shall not take effect earlier than
January 1, 2002.
SEC. 113. PROTECTION OF SAVINGS EARMARKED FOR THE POSTSECONDARY
EDUCATION OF CHILDREN.
Section 522 of title 11, United States Code, is amended--
(1) in subsection (b)(2)--
(A) in subparagraph (A) by striking ``and'' at the
end;
(B) in subparagraph (B) by striking the period at
the end and inserting ``; and''; and
(C) by adding at the end the following:
``(C) except as provided in paragraph (n), funds placed in
an education individual retirement account (as defined in
section 530(b)(1) of the Internal Revenue Code of 1986) not
less than 365 days before the date of entry of the order of
relief but only to the extent such funds--
``(i) are not pledged or promised to any entity in
connection with any extension of credit; and
``(ii) are not excess contributions (as described
in section 4973(e) of the Internal Revenue Code of
1986).''; and
(2) by adding at the end the following:
``(n) For purposes of subsection (b)(3)(C), funds placed in an
education individual retirement account shall not be exempt under this
subsection--
``(1) unless the designated beneficiary of such account was
a dependent child of the debtor for the taxable year for which
the funds were placed in such account; and
``(2) to the extent such funds exceed--
``(A) $50,000 in the aggregate in all such accounts
having the same designated beneficiary; or
``(B) $100,000 in the aggregate in all such
accounts attributable to all such dependent children of
the debtor.''.
SEC. 114. EFFECT OF DISCHARGE.
Section 524 of title 11, United States Code, is amended by adding
at the end the following:
``(i) The willful failure of a creditor to credit payments received
under a plan confirmed under this title (including a plan of
reorganization confirmed under chapter 11 of this title) in the manner
required by the plan (including crediting the amounts required under
the plan) shall constitute a violation of any injunction under
subsection (a)(2) which has arisen at the time of the failure.
``(j)(1) An individual who is injured by the willful failure of a
creditor to comply with the requirements for a reaffirmation agreement
under subsections (c) and (d), or by any willful violation of the
injunction under subsection (a)(2), shall be entitled to recover--
``(A) the greater of--
``(i) the amount of actual damages; or
``(ii) $1,000; and
``(B) costs and attorneys' fees.
``(2) An action to recover for a violation specified in paragraph
(1) may not be brought as a class action.''.
SEC. 115. LIMITING TRUSTEE LIABILITY.
(a) Qualification of Trustee.--Section 322 of title 11, United
States Code, is amended--
(1) in subsection (a) by adding at the end the following:
``The trustee in a case under this title is not liable
personally or on such trustee's bond for acts taken within the
scope of the trustee's duties or authority as delineated by
other sections of this title or by order of the court, except
to the extent that the trustee acted with gross negligence.
Gross negligence shall be defined as reckless indifference or
deliberate disregard of the trustee's fiduciary duty.''; and
(2) in subsection (c) by inserting ``for any acts within
the scope of the trustee's authority defined in subsection
(a)'' before the period at the end.
(b) Role and Capacity of Trustee.--Section 323 of title 11, United
States Code, is amended--
(1) in subsection (b) by inserting at the end the
following: ``in the trustee's official capacity as
representative of the estate'' before the period at the end;
and
(2) by adding at the end the following:
``(c) The trustee in a case under this title may not be sued,
either personally, in a representative capacity, or against the
trustee's bond in favor of the United States--
``(1) for acts taken in furtherance of the trustee's duties
or authority in a case in which the debtor is subsequently
determined to be ineligible for relief under the chapter in
which the trustee was appointed; or
``(2) for the dissemination of statistics and other
information regarding a case or cases, unless the trustee has
actual knowledge that the information is false.
``(d) The trustee in a case under this title may not be sued in a
personal capacity without leave of the bankruptcy court in which the
case is pending.''.
SEC. 116. REINFORCE THE FRESH START.
(a) Restoration of an Effective Discharge.--Section 523(a)(17) of
title 11, United States Code, is amended--
(1) by striking ``by a court'' and inserting ``by any
court'',
(2) by striking ``section 1915(b) or (f)'' and inserting
``subsection (b) or (f)(2) of section 1915'', and
(3) by inserting ``(or a similar non-Federal law)'' after
``title 28'' each place it appears.
SEC. 117. DISCOURAGING BAD FAITH REPEAT FILINGS.
Section 362(c) of title 11, United States Code, is amended--
(1) in paragraph (1) by striking ``and'' at the end;
(2) in paragraph (2) by striking the period at the end and
inserting a semicolon; and
(3) by adding at the end the following new paragraphs:
``(3) If a single or joint case is filed by or against an
individual debtor under chapter 7, 11, or 13 (other than a case
refiled under a chapter other than chapter 7 after dismisssal
under section 707(b) of this title), and if a single or joint
case of the debtor was pending within the previous 1-year
period but was dismissed, the stay under subsection (a) with
respect to any action taken with respect to a debt or property
securing such debt or with respect to any lease will terminate
with respect to the debtor on the 30th day after the filing of
the later case. Upon motion by a party in interest for
continuation of the automatic stay and upon notice and a
hearing, the court may extend the stay in particular cases as
to any or all creditors (subject to such conditions or
limitations as the court may then impose) after notice and a
hearing completed before the expiration of the 30-day period
only if the party in interest demonstrates that the filing of
the later case is in good faith as to the creditors to be
stayed. A case is presumptively filed not in good faith (but
such presumption may be rebutted by clear and convincing
evidence to the contrary)--
``(A) as to all creditors if--
``(i) more than 1 previous case under any
of chapter 7, 11, or 13 in which the individual
was a debtor was pending within such 1-year
period;
``(ii) a previous case under any of
chapters 7, 11, or 13 in which the individual
was a debtor was dismissed within such 1-year
period, after the debtor failed to file or
amend the petition or other documents as
required by this title or the court without
substantial excuse (but mere inadvertence or
negligence shall not be substantial excuse
unless the dismissal was caused by the
negligence of the debtor's attorney), failed to
provide adequate protection as ordered by the
court, or failed to perform the terms of a plan
confirmed by the court; or
``(iii) there has not been a substantial
change in the financial or personal affairs of
the debtor since the dismissal of the next most
previous case under any of chapters 7, 11, or
13 of this title, or there is not any other
reason to conclude that the later case will be
concluded, if a case under chapter 7 of this
title, with a discharge, and if a chapter 11 or
13 case, a confirmed plan which will be fully
performed;
``(B) as to any creditor that commenced an action
under subsection (d) in a previous case in which the
individual was a debtor if, as of the date of dismissal
of such case, that action was still pending or had been
resolved by terminating, conditioning, or limiting the
stay as to actions of such creditor.
``(4) If a single or joint case is filed by or against an
individual debtor under this title (other than a case refiled
under a chapter other than chapter 7 after a dismissal under
section 707(b) of this title), and if 2 or more single or joint
cases of the debtor were pending within the previous year but
were dismissed, the stay under subsection (a) will not go into
effect upon the filing of the later case. On request of a party
in interest, the court shall promptly enter an order confirming
that no stay is in effect. If a party in interest requests
within 30 days of the filing of the later case, the court may
order the stay to take effect in the case as to any or all
creditors (subject to such conditions or limitations as the
court may impose), after notice and hearing, only if the party
in interest demonstrates that the filing of the later case is in good
faith as to the creditors to be stayed. A stay imposed pursuant to the
preceding sentence will be effective on the date of entry of the order
allowing the stay to go into effect. A case is presumptively not filed
in good faith (but such presumption may be rebutted by clear and
convincing evidence to the contrary)--
``(A) as to all creditors if--
``(i) 2 or more previous cases under this
title in which the individual was a debtor were
pending within the 1-year period;
``(ii) a previous case under this title in
which the individual was a debtor was dismissed
within the time period stated in this paragraph
after the debtor failed to file or amend the
petition or other documents as required by this
title or the court without substantial excuse
(but mere inadvertence or negligence shall not
be substantial excuse unless the dismissal was
caused by the negligence of the debtor's
attorney), failed to provide adequate
protection as ordered by the court, or failed
to perform the terms of a plan confirmed by the
court; or
``(iii) there has not been a substantial
change in the financial or personal affairs of
the debtor since the dismissal of the next most
previous case under this title, or there is not
any other reason to conclude that the later
case will be concluded, if a case under chapter
7, with a discharge, and if a case under
chapter 11 or 13, with a confirmed plan that
will be fully performed; or
``(B) as to any creditor that commenced an action
under subsection (d) in a previous case in which the
individual was a debtor if, as of the date of dismissal
of such case, such action was still pending or had been
resolved by terminating, conditioning, or limiting the
stay as to action of such creditor.''.
SEC. 118. CURBING ABUSIVE FILINGS.
(a) In General.--Section 362(d) of title 11, United States Code, is
amended--
(1) in paragraph (2), by striking ``or'' at the end;
(2) in paragraph (3), by striking the period at the end and
inserting ``; or''; and
(3) by adding at the end the following:
``(4) with respect to a stay of an act against real
property under subsection (a), by a creditor whose claim is
secured by an interest in such real estate, if the court finds
that the filing of the bankruptcy petition was part of a scheme
to delay, hinder, and defraud creditors that involved either--
``(A) transfer of all or part ownership of, or
other interest in, the real property without the
consent of the secured creditor or court approval; or
``(B) multiple bankruptcy filings affecting the
real property.
If recorded in compliance with applicable State laws governing notices
of interests or liens in real property, an order entered pursuant to
this subsection shall be binding in any other case under this title
purporting to affect the real property filed not later than 2 years
after that recording, except that a debtor in a subsequent case may
move for relief from such order based upon changed circumstances or for
good cause shown, after notice and a hearing. Any Federal, State, or
local governmental unit which accepts notices of interests or liens in
real property shall accept any certified copy of an order described in
this subsection for indexing and recording.''.
(b) Automatic Stay.--Section 362(b) of title 11, United States
Code, is amended--
(1) in paragraph (17), by striking ``or'' at the end;
(2) in paragraph (18) by striking the period at the end and
inserting a semicolon; and
(3) by inserting after paragraph (18) the following:
``(19) under subsection (a), of any act to enforce any lien
against or security interest in real property following the
entry of an order under section 362(d)(4) of this title as to
that property in any prior bankruptcy case for a period of 2
years after entry of such an order. The debtor in a subsequent
case, however, may move the court for relief from such order
based upon changed circumstances or for other good cause shown
(consistent with the standards for good faith in subsection
(c)), after notice and a hearing; or
``(20) under subsection (a), of any act to enforce any lien
against or security interest in real property--
``(A) if the debtor is ineligible under section
109(g) of this title to be a debtor in a bankruptcy
case; or
``(B) if the bankruptcy case was filed in violation
of a bankruptcy court order in a prior bankruptcy case
prohibiting the debtor from being a debtor in another
bankruptcy case.''.
SEC. 119. DEBTOR RETENTION OF PERSONAL PROPERTY SECURITY.
Title 11, United States Code, is amended--
(1) in section 521--
(A) in paragraph (4) by striking ``, and'' at the
end and inserting a semicolon;
(B) in paragraph (5) by striking the period at the
end and inserting ``; and''; and
(C) by adding at the end the following:
``(6) in an individual case under chapter 7 of this title,
not retain possession of personal property as to which a
creditor has an allowed claim for the purchase price secured in
whole or in part by an interest in that personal property
unless, in the case of an individual debtor, the debtor takes 1
of the following actions within 45 days after the first meeting
of creditors under section 341(a)--
``(A) enters into an agreement with the creditor
pursuant to section 524(c) of this title with respect
to the claim secured by such property; or
``(B) redeems such property from the security
interest pursuant to section 722 of this title.
``If the debtor fails to so act within the 45-day period, the
stay under section 362(a) of this title is terminated with
respect to the personal property of the estate or of the debtor
which is affected, such property shall no longer be property of
the estate, and the creditor may take whatever action as to
such property as is permitted by applicable nonbankruptcy law,
unless the court determines on the motion of the trustee
brought before the expiration of such 45-day period, and after
notice and a hearing, that such property is of consequential
value or benefit to the estate, orders appropriate adequate
protection of the creditor's interest, and orders the debtor to
deliver any collateral in the debtor's possession to the
trustee.''; and
(2) in section 722 by inserting ``in full at the time of
redemption'' before the period at the end.
SEC. 120. RELIEF FROM THE AUTOMATIC STAY WHEN THE DEBTOR DOES NOT
COMPLETE INTENDED SURRENDER OF CONSUMER DEBT COLLATERAL.
Title 11, United States Code, is amended as follows--
(1) in section 362--
(A) by striking ``(e), and (f)'' in subsection (c)
and inserting in lieu thereof ``(e), (f), and (h)'';
and
(B) by redesignating subsection (h) as subsection
(i) and by inserting after subsection (g) the
following:
``(h) In an individual case pursuant to chapter 7, 11, or 13 the
stay provided by subsection (a) is terminated with respect to personal
property of the estate or of the debtor securing in whole or in part a
claim, or subject to an unexpired lease, and such personal property
shall no longer be property of the estate if the debtor fails within
the applicable time set by section 521(a)(2) of this title--
``(1) to file timely any statement of intention required
under section 521(a)(2) of this title with respect to that
property or to indicate therein that the debtor will either
surrender the property or retain it and, if retaining it,
either redeem the property pursuant to section 722 of this
title, reaffirm the debt it secures pursuant to section 524(c)
of this title, or assume the unexpired lease pursuant to
section 365(p) of this title if the trustee does not do so, as
applicable; or
``(2) to take timely the action specified in that statement
of intention, as it may be amended before expiration of the
period for taking action, unless the statement of intention specifies
reaffirmation and the creditor refuses to reaffirm on the original
contract terms;
unless the court determines on the motion of the trustee filed before
the expiration of the applicable time set by section 521(a)(2), and
after notice and a hearing, that such property is of consequential
value or benefit to the estate, orders appropriate adequate protection
of the creditor's interest, and orders the debtor to deliver any
collateral in the debtor's possession to the trustee. If the court does
not so determine an order, the stay shall terminate upon the conclusion
of the proceeding on the motion.''; and
(2) in section 521, as amended by sections 603 and 604--
(A) in paragraph (2) by striking ``consumer'';
(B) in paragraph (2)(B)--
(i) by striking ``forty-five days after the
filing of a notice of intent under this
section'' and inserting ``30 days after the
first date set for the meeting of creditors
under section 341(a) of this title''; and
(ii) by striking ``forty-five day'' the
second place it appears and inserting ``30-
day'';
(C) in paragraph (2)(C) by inserting ``except as
provided in section 362(h) of this title'' before the
semicolon; and
(D) by inserting after subsection (b) the
following:
``(c) If the debtor fails timely to take the action specified in
subsection (a)(6) of this section, or in paragraphs (1) and (2) of
section 362(h) of this title, with respect to property which a lessor
or bailor owns and has leased, rented, or bailed to the debtor or as to
which a creditor holds a security interest not otherwise voidable under
section 522(f), 544, 545, 547, 548, or 549 of this title, nothing in
this title shall prevent or limit the operation of a provision in the
underlying lease or agreement which has the effect of placing the
debtor in default under such lease or agreement by reason of the
occurrence, pendency, or existence of a proceeding under this title or
the insolvency of the debtor. Nothing in this subsection shall be
deemed to justify limiting such a provision in any other
circumstance.''.
SEC. 121. GIVING SECURED CREDITORS FAIR TREATMENT IN CHAPTER 13.
Section 1325(a)(5)(B)(i) of title 11, United States Code, is
amended to read as follows:
``(i) the plan provides that the holder of such
claim retain the lien securing such claim until the
earlier of payment of the underlying debt determined
under nonbankruptcy law or discharge under section 1328
of this title, and that if the case under this chapter
is dismissed or converted without completion of the
plan, such lien shall also be retained by such holder
to the extent recognized by applicable nonbankruptcy
law; and''.
SEC. 122. RESTRAINING ABUSIVE PURCHASES ON SECURED CREDIT.
Section 506 of title 11, United States Code, is amended by adding
at the end the following:
``(e) In an individual case under chapter 7, 11, 12, or 13--
``(1) subsection (a) shall not apply to an allowed claim to
the extent attributable in whole or in part to the purchase
price of personal property acquired by the debtor within 5
years of the filing of the petition, except for the purpose of
applying paragraph (3) of this subsection;
``(2) if such allowed claim attributable to the purchase
price is secured only by the personal property so acquired, the
value of the personal property and the amount of the allowed
secured claim shall be the sum of the unpaid principal balance
of the purchase price and accrued and unpaid interest and
charges at the contract rate;
``(3) if such allowed claim attributable to the purchase
price is secured by the personal property so acquired and other
property, the value of the security may be determined under
subsection (a), but the value of the security and the amount of
the allowed secured claim shall be not less than the unpaid
principal balance of the purchase price of the personal
property acquired and unpaid interest and charges at the
contract rate; and
``(4) in any subsequent case under this title that is filed
by or against the debtor in the 2-year period beginning on the
date the petition is filed in the original case, the value of
the personal property and the amount of the allowed secured
claim shall be deemed to be not less than the amount provided
under paragraphs (2) and (3) less any payments actually
received.''.
SEC. 123. FAIR VALUATION OF COLLATERAL.
Section 506(a) of title 11, United States Code, is amended by
adding at the end the following:
``In the case of an individual debtor under chapters 7 and 13, such
value with respect to personal property securing an allowed claim shall
be determined based on the replacement value of such property as of the
date of filing the petition without deduction for costs of sale or
marketing. With respect to property acquired for personal, family, or
household purpose, replacement value shall mean the price a retail
merchant would charge for property of that kind considering the age and
condition of the property at the time value is determined.''.
SEC. 124. DOMICILIARY REQUIREMENTS FOR EXEMPTIONS.
Section 522(b)(2)(A) of title 11, United States Code, is amended--
(1) by striking ``180'' and inserting ``730''; and
(2) by striking ``, or for a longer portion of such 180-day
period than in any other place'' and inserting ``or if the
debtor's domicile has not been located at a single State for
such 730-day period, the place in which the debtor's domicile
was located for 180 days immediately preceding the 730-day
period or for a longer portion of such 180-day period than in
any other place''.
SEC. 125. RESTRICTIONS ON CERTAIN EXEMPT PROPERTY OBTAINED THROUGH
FRAUD.
Section 522 of title 11, United States Code, as amended by section
113, is amended--
(1) in subsection (b)(2)(A) by inserting ``subject to
subsection (o),'' before ``any property''; and
(2) by adding at the end the following:
``(o) For purposes of subsection (b)(3)(A) and notwithstanding
subsection (a), the value of an interest in--
``(1) real or personal property that the debtor or a
dependent of the debtor uses as a residence;
``(2) a cooperative that owns property that the debtor or a
dependent of the debtor uses as a residence; or
``(3) a burial plot for the debtor or a dependent of the
debtor;
shall be reduced to the extent such value is attributable to any
portion of any property that the debtor disposed of in the 730-day
period ending of the date of the filing of the petition, with the
intent to hinder, delay, or defraud a creditor and that the debtor
could not exempt, or that portion that the debtor could not exempt,
under subsection (b) if on such date the debtor had held the property
so disposed of.''.
SEC. 126. ROLLING STOCK EQUIPMENT.
(a) In General.--Section 1168 of title 11, United States Code, is
amended to read as follows:
``Sec. 1168. Rolling stock equipment
``(a)(1) The right of a secured party with a security interest in
or of a lessor or conditional vendor of equipment described in
paragraph (2) to take possession of such equipment in compliance with
an equipment security agreement, lease, or conditional sale contract,
and to enforce any of its other rights or remedies under such security
agreement, lease, or conditional sale contract, to sell, lease, or
otherwise retain or dispose of such equipment, is not limited or
otherwise affected by any other provision of this title or by any power
of the court, except that the right to take possession and enforce
those other rights and remedies shall be subject to section 362 of this
title, if--
``(A) before the date that is 60 days after the date of
commencement of a case under this chapter, the trustee, subject
to the court's approval, agrees to perform all obligations of
the debtor under such security agreement, lease, or conditional
sale contract; and
``(B) any default, other than a default of a kind described
in section 365(b)(2) of this title, under such security
agreement, lease, or conditional sale contract--
``(i) that occurs before the date of commencement
of the case and is an event of default therewith is
cured before the expiration of such 60-day period;
``(ii) that occurs or becomes an event of default
after the date of commencement of the case and before
the expiration of such 60-day period is cured before
the later of--
``(I) the date that is 30 days after the
date of the default or event of the default; or
``(II) the expiration of such 60-day
period; and
``(iii) that occurs on or after the expiration of
such 60-day period is cured in accordance with the
terms of such security agreement, lease, or conditional
sale contract, if cure is permitted under that
agreement, lease, or conditional sale contract.
``(2) The equipment described in this paragraph--
``(A) is rolling stock equipment or accessories used on
rolling stock equipment, including superstructures or racks,
that is subject to a security interest granted by, leased to,
or conditionally sold to a debtor; and
``(B) includes all records and documents relating to such
equipment that are required, under the terms of the security
agreement, lease, or conditional sale contract, that is to be
surrendered or returned by the debtor in connection with the
surrender or return of such equipment.
``(3) Paragraph (1) applies to a secured party, lessor, or
conditional vendor acting in its own behalf or acting as trustee or
otherwise in behalf of another party.
``(b) The trustee and the secured party, lessor, or conditional
vendor whose right to take possession is protected under subsection (a)
may agree, subject to the court's approval, to extend the 60-day period
specified in subsection (a)(1).
``(c)(1) In any case under this chapter, the trustee shall
immediately surrender and return to a secured party, lessor, or
conditional vendor, described in subsection (a)(1), equipment described
in subsection (a)(2), if at any time after the date of commencement of
the case under this chapter such secured party, lessor, or conditional
vendor is entitled pursuant to subsection (a)(1) to take possession of
such equipment and makes a written demand for such possession of the
trustee.
``(2) At such time as the trustee is required under paragraph (1)
to surrender and return equipment described in subsection (a)(2), any
lease of such equipment, and any security agreement or conditional sale
contract relating to such equipment, if such security agreement or
conditional sale contract is an executory contract, shall be deemed
rejected.
``(d) With respect to equipment first placed in service on or prior
to October 22, 1994, for purposes of this section--
``(1) the term `lease' includes any written agreement with
respect to which the lessor and the debtor, as lessee, have
expressed in the agreement or in a substantially
contemporaneous writing that the agreement is to be treated as
a lease for Federal income tax purposes; and
``(2) the term `security interest' means a purchase-money
equipment security interest.
``(e) With respect to equipment first placed in service after
October 22, 1994, for purposes of this section, the term `rolling stock
equipment' includes rolling stock equipment that is substantially
rebuilt and accessories used on such equipment.''.
(b) Aircraft Equipment and Vessels.--Section 1110 of title 11,
United States Code, is amended to read as follows:
``Sec. 1110. Aircraft equipment and vessels
``(a)(1) Except as provided in paragraph (2) and subject to
subsection (b), the right of a secured party with a security interest
in equipment described in paragraph (3), or of a lessor or conditional
vendor of such equipment, to take possession of such equipment in
compliance with a security agreement, lease, or conditional sale
contract, and to enforce any of its other rights or remedies, under
such security agreement, lease, or conditional sale contract, to sell,
lease, or otherwise retain or dispose of such equipment, is not limited
or otherwise affected by any other provision of this title or by any
power of the court.
``(2) The right to take possession and to enforce the other rights
and remedies described in paragraph (1) shall be subject to section 362
of this title if--
``(A) before the date that is 60 days after the date of the
order for relief under this chapter, the trustee, subject to
the approval of the court, agrees to perform all obligations of
the debtor under such security agreement, lease, or conditional
sale contract; and
``(B) any default, other than a default of a kind specified
in section 365(b)(2) of this title, under such security
agreement, lease, or conditional sale contract--
``(i) that occurs before the date of the order is
cured before the expiration of such 60-day period;
``(ii) that occurs after the date of the order and
before the expiration of such 60-day period is cured
before the later of--
``(I) the date that is 30 days after the
date of the default; or
``(II) the expiration of such 60-day
period; and
``(iii) that occurs on or after the expiration of
such 60-day period is cured in compliance with the
terms of such security agreement, lease, or conditional
sale contract, if a cure is permitted under that
agreement, lease, or contract.
``(3) The equipment described in this paragraph--
``(A) is--
``(i) an aircraft, aircraft engine, propeller,
appliance, or spare part (as defined in section 40102
of title 49) that is subject to a security interest
granted by, leased to, or conditionally sold to a
debtor that, at the time such transaction is entered
into, holds an air carrier operating certificate issued
pursuant to chapter 447 of title 49 for aircraft
capable of carrying 10 or more individuals or 6,000
pounds or more of cargo; or
``(ii) a documented vessel (as defined in section
30101(1) of title 46) that is subject to a security
interest granted by, leased to, or conditionally sold
to a debtor that is a water carrier that, at the time
such transaction is entered into, holds a certificate
of public convenience and necessity or permit issued by
the Department of Transportation; and
``(B) includes all records and documents relating to such
equipment that are required, under the terms of the security
agreement, lease, or conditional sale contract, to be
surrendered or returned by the debtor in connection with the
surrender or return of such equipment.
``(4) Paragraph (1) applies to a secured party, lessor, or
conditional vendor acting in its own behalf or acting as trustee or
otherwise in behalf of another party.
``(b) The trustee and the secured party, lessor, or conditional
vendor whose right to take possession is protected under subsection (a)
may agree, subject to the approval of the court, to extend the 60-day
period specified in subsection (a)(1).
``(c)(1) In any case under this chapter, the trustee shall
immediately surrender and return to a secured party, lessor, or
conditional vendor, described in subsection (a)(1), equipment described
in subsection (a)(3), if at any time after the date of the order for
relief under this chapter such secured party, lessor, or conditional
vendor is entitled pursuant to subsection (a)(1) to take possession of
such equipment and makes a written demand for such possession to the
trustee.
``(2) At such time as the trustee is required under paragraph (1)
to surrender and return equipment described in subsection (a)(3), any
lease of such equipment, and any security agreement or conditional sale
contract relating to such equipment, if such security agreement or
conditional sale contract is an executory contract, shall be deemed
rejected.
``(d) With respect to equipment first placed in service on or
before October 22, 1994, for purposes of this section--
``(1) the term `lease' includes any written agreement with
respect to which the lessor and the debtor, as lessee, have
expressed in the agreement or in a substantially
contemporaneous writing that the agreement is to be treated as
a lease for Federal income tax purposes; and
``(2) the term `security interest' means a purchase-money
equipment security interest.''.
SEC. 127. DISCHARGE UNDER CHAPTER 13.
Section 1328(a) of title 11, United States Code, is amended by
striking paragraphs (1) through (3) and inserting the following:
``(1) provided for under section 1322(b)(5) of this title;
``(2) of the kind specified in paragraph (2), (4), (3)(B),
(5), (8), or (9) of section 523(a) of this title;
``(3) for restitution, or a criminal fine, included in a
sentence on the debtor's conviction of a crime; or
``(4) for restitution, or damages, awarded in a civil
action against the debtor as a result of willful or malicious
injury by the debtor that caused personal injury to an
individual or the death of an individual.''.
SEC. 128. BANKRUPTCY JUDGESHIPS.
(a) Short Title.--This section may be cited as the ``Bankruptcy
Judgeship Act of 1999''.
(b) Temporary Judgeships.--
(1) Appointments.--The following judgeship positions shall
be filled in the manner prescribed in section 152(a)(1) of
title 28, United States Code, for the appointment of
bankruptcy judges provided for in section 152(a)(2) of such title:
(A) One additional bankruptcy judgeship for the
eastern district of California.
(B) Four additional bankruptcy judgeships for the
central district of California.
(C) One additional bankruptcy judgeship for the
southern district of Florida.
(D) Two additional bankruptcy judgeships for the
district of Maryland.
(E) One additional bankruptcy judgeship for the
eastern district of Michigan.
(F) One additional bankruptcy judgeship for the
southern district of Mississippi.
(G) One additional bankruptcy judgeship for the
district of New Jersey.
(H) One additional bankruptcy judgeship for the
eastern district of New York.
(I) One additional bankruptcy judgeship for the
northern district of New York.
(J) One additional bankruptcy judgeship for the
southern district of New York.
(K) One additional bankruptcy judgeship for the
eastern district of Pennsylvania.
(L) One additional bankruptcy judgeship for the
middle district of Pennsylvania.
(M) One additional bankruptcy judgeship for the
western district of Tennessee.
(N) One additional bankruptcy judgeship for the
eastern district of Virginia.
(2) Vacancies.--The first vacancy occurring in the office
of a bankruptcy judge in each of the judicial districts set
forth in paragraph (1) that--
(A) results from the death, retirement,
resignation, or removal of a bankruptcy judge; and
(B) occurs 5 years or more after the appointment
date of a bankruptcy judge appointed under paragraph
(1);
shall not be filled.
(c) Extensions.--
(1) In general.--The temporary bankruptcy judgeship
positions authorized for the northern district of Alabama, the
district of Delaware, the district of Puerto Rico, the district
of South Carolina, and the eastern district of Tennessee under
section 3(a) (1), (3), (7), (8), and (9) of the Bankruptcy
Judgeship Act of 1992 (28 U.S.C. 152 note) are extended until
the first vacancy occurring in the office of a bankruptcy judge
in the applicable district resulting from the death,
retirement, resignation, or removal of a bankruptcy judge and
occurring--
(A) 8 years or more after November 8, 1993, with
respect to the northern district of Alabama;
(B) 10 years or more after October 28, 1993, with
respect to the district of Delaware;
(C) 8 years or more after August 29, 1994, with
respect to the district of Puerto Rico;
(D) 8 years or more after June 27, 1994, with
respect to the district of South Carolina; and
(E) 8 years or more after November 23, 1993, with
respect to the eastern district of Tennessee.
(2) Applicability of other provisions.--All other
provisions of section 3 of the Bankruptcy Judgeship Act of 1992
remain applicable to such temporary judgeship position.
(d) Technical Amendment.--The first sentence of section 152(a)(1)
of title 28, United States Code, is amended to read as follows: ``Each
bankruptcy judge to be appointed for a judicial district as provided in
paragraph (2) shall be appointed by the United States court of appeals
for the circuit in which such district is located.''.
(e) Travel Expenses of Bankruptcy Judges.--Section 156 of title 28,
United States Code, is amended by adding at the end the following new
subsection:
``(g)(1) In this subsection, the term `travel expenses'--
``(A) means the expenses incurred by a bankruptcy judge for
travel that is not directly related to any case assigned to
such bankruptcy judge; and
``(B) shall not include the travel expenses of a bankruptcy
judge if--
``(i) the payment for the travel expenses is paid
by such bankruptcy judge from the personal funds of
such bankruptcy judge; and
``(ii) such bankruptcy judge does not receive funds
(including reimbursement) from the United States or any
other person or entity for the payment of such travel
expenses.
``(2) Each bankruptcy judge shall annually submit the information
required under paragraph (3) to the chief bankruptcy judge for the
district in which the bankruptcy judge is assigned.
``(3)(A) Each chief bankruptcy judge shall submit an annual report
to the Director of the Administrative Office of the United States
Courts on the travel expenses of each bankruptcy judge assigned to the
applicable district (including the travel expenses of the chief
bankruptcy judge of such district).
``(B) The annual report under this paragraph shall include--
``(i) the travel expenses of each bankruptcy judge, with
the name of the bankruptcy judge to whom the travel expenses
apply;
``(ii) a description of the subject matter and purpose of
the travel relating to each travel expense identified under
clause (i), with the name of the bankruptcy judge to whom the
travel applies; and
``(iii) the number of days of each travel described under
clause (ii), with the name of the bankruptcy judge to whom the
travel applies.
``(4)(A) The Director of the Administrative Office of the United
States Courts shall--
``(i) consolidate the reports submitted under paragraph (3)
into a single report; and
``(ii) annually submit such consolidated report to
Congress.
``(B) The consolidated report submitted under this paragraph shall
include the specific information required under paragraph (3)(B),
including the name of each bankruptcy judge with respect to clauses
(i), (ii), and (iii) of paragraph (3)(B).''.
SEC. 129. ADDITIONAL AMENDMENTS TO TITLE 11, UNITED STATES CODE.
Section 507(a) of title 11, United States Code, is amended by
inserting after paragraph (9) the following:
``(10) Tenth, allowed claims for death or personal injuries
resulting from the operation of a motor vehicle or vessel if
such operation was unlawful because the debtor was intoxicated
from using alcohol, a drug or another substance.''.
SEC. 130. AMENDMENT TO SECTION 1325 OF TITLE 11, UNITED STATES CODE.
Section 1325(b) of title 11, United States Code, is amended--
(1) in paragraph (1), by inserting ``to unsecured
creditors'' after ``to make payments'';
(2) in paragraph (2)--
(A) by inserting ``current monthly'' before
``income'';
(B) by striking ``and which is not'' and inserting
``less amounts'';
(C) by inserting after ``received by the debtor'',
``(other than child support payments, foster care
payments, or disability payments for a dependent child
made in accordance with applicable nonbankruptcy law
and which is reasonably necessary to be expended)'';
and
(D) in subparagraph (A) by inserting after
``dependent of the debtor'' the following: ``, as
determined in accordance with section 707(b)(2)(A) and
if applicable 707(b)(2)(B)''.
SEC. 131. APPLICATION OF THE CODEBTOR STAY ONLY WHEN THE STAY PROTECTS
THE DEBTOR.
Section 1301(b) of title 11, United States Code, is amended--
(1) by inserting ``(1)'' after ``(b)''; and
(2) by adding at the end the following:
``(2)(A) Notwithstanding subsection (c) and except as provided in
subparagraph (B), in any case in which the debtor did not receive the
consideration for the claim held by a creditor, the stay provided by
subsection (a) shall apply to that creditor for a period not to exceed
30 days beginning on the date of the order for relief, to the extent
the creditor proceeds against--
``(i) the individual that received that consideration; or
``(ii) property not in the possession of the debtor that
secures that claim.
``(B) Notwithstanding subparagraph (A), the stay provided by
subsection (a) shall apply in any case in which the debtor is primarily
obligated to pay the creditor in whole or in part with respect to a
claim described in subparagraph (A) under a legally binding separation
or property settlement agreement or divorce or dissolution decree with
respect to--
``(i) an individual described in subparagraph (A)(i); or
``(ii) property described in subparagraph (A)(ii).
``(3) Notwithstanding subsection (c), the stay provided by
subsection (a) shall terminate as of the date of confirmation of the
plan, in any case in which the plan of the debtor provides that the
debtor's interest in personal property subject to a lease with respect
to which the debtor is the lessee will be surrendered or abandoned or
no payments will be made under the plan on account of the debtor's
obligations under the lease.''.
SEC. 132. ADEQUATE PROTECTION FOR INVESTORS.
(a) Definition.--Section 101 of title 11, United States Code, is
amended by inserting after paragraph (48) the following:
``(48A) `securities self regulatory organization' means
either a securities association registered with the Securities
and Exchange Commission pursuant to section 15A of the
Securities Exchange Act of 1934 or a national securities
exchange registered with the Securities and Exchange Commission
pursuant to section 6 of the Securities Exchange Act of
1934;''.
(b) Automatic Stay.--Section 362(b) of title 11, United States
Code, as amended by section 118, is amended--
(1) in paragraph (19) by striking ``or'' at the end;
(2) in paragraph (20) by striking the period at the end and
a inserting ``; or''; and
(3) by inserting after paragraph (20) the following:
``(21) under subsection (a), of the commencement or
continuation of an investigation or action by a securities self
regulatory organization to enforce such organization's
regulatory power; of the enforcement of an order or decision,
other than for monetary sanctions, obtained in an action by the
securities self regulatory organization to enforce such
organization's regulatory power; or of any act taken by the
securities self regulatory organization to delist, delete, or
refuse to permit quotation of any stock that does not meet
applicable regulatory requirements.''.
SEC. 133. LIMITATION ON LUXURY GOODS.
Section 523(a)(2)(C) of title 11, United States Code, is amended to
read as follows:
``(C)(i) for purposes of subparagraph (A), consumer
debts owed to a single creditor and aggregating more
than $250 for `luxury goods or services' incurred by an
individual debtor on or within 90 days before the order
for relief under this title, or cash advances
aggregating more than $250 that are extensions of
consumer credit under an open end credit plan obtained
by an individual debtor on or within 90 days before the
order for relief under this title, are presumed to be
nondischargeable; and
``(ii) for purposes of this subparagraph--
``(I) the term `luxury goods or services'
does not include goods or services reasonably
necessary for the support or maintenance of the
debtor or a dependent of the debtor; and
``(II) the term `an extension of consumer
credit under an open end credit plan' has the
same meaning such term has for purposes of the
Consumer Credit Protection Act;''.
SEC. 134. GIVING DEBTORS THE ABILITY TO KEEP LEASED PERSONAL PROPERTY
BY ASSUMPTION.
Section 365 of title 11, United States Code, is amended by adding
at the end the following:
``(p)(1) If a lease of personal property is rejected or not timely
assumed by the trustee under subsection (d), the leased property is no
longer property of the estate and the stay under section 362(a) of this
title is automatically terminated.
``(2) In the case of an individual under chapter 7, the debtor may
notify the creditor in writing that the debtor desires to assume the
lease. Upon being so notified, the creditor may, at its option, notify
the debtor that it is willing to have the lease assumed by the debtor
and may, at its option, condition such assumption on cure of any
outstanding default on terms set by the contract. If within 30 days of
the notice from the creditor the debtor notifies the lessor in writing
that the lease is assumed, the liability under the lease will be
assumed by the debtor and not by the estate. The stay under section 362
of this title and the injunction under section 524(a) of this title
shall not be violated by notification of the debtor and negotiation of
cure under this subsection. Nothing in this paragraph shall require a
debtor to assume a lease, or a creditor to permit assumption.
``(3) In a case under chapter 11 of this title in which the debtor
is an individual and in a case under chapter 13 of this title, if the
debtor is the lessee with respect to personal property and the lease is
not assumed in the plan confirmed by the court, the lease is deemed
rejected as of the conclusion of the hearing on confirmation. If the
lease is rejected, the stay under section 362 of this title and any
stay under section 1301 is automatically terminated with respect to the
property subject to the lease.''.
SEC. 135. ADEQUATE PROTECTION OF LESSORS AND PURCHASE MONEY SECURED
CREDITORS.
(a) In General.--Chapter 13 of title 11, United States Code, is
amended by adding after section 1307 the following:
``Sec. 1307A. Adequate protection in chapter 13 cases
``(a)(1)(A) On or before the date that is 30 days after the filing
of a case under this chapter, the debtor shall make cash payments in an
amount determined under paragraph (2), to--
``(i) any lessor of personal property; and
``(ii) any creditor holding a claim secured by personal
property to the extent that the claim is attributable to the
purchase of that property by the debtor.
``(B) The debtor or the plan shall continue making the adequate
protection payments required under subparagraph (A) until the earlier
of the date on which--
``(i) the creditor begins to receive actual payments under
the plan; or
``(ii) the debtor relinquishes possession of the property
referred to in subparagraph (A) to--
``(I) the lessor or creditor; or
``(II) any third party acting under claim of right,
as applicable.
``(2) The payments referred to in paragraph (1)(A) shall be the
contract amount and shall reduce any amount payable under section
1326(a) of the title.
``(b)(1) Subject to the limitations under paragraph (2), the court
may, after notice and hearing, change the amount and timing of the
dates of payment of payments made under subsection (a).
``(2)(A) The payments referred to in paragraph (1) shall be payable
not less frequently than monthly.
``(B) The amount of payments referred to in paragraph (1) shall not
be less than the amount of any weekly, biweekly, monthly, or other
periodic payment scheduled as payable under the contract between the
debtor and creditor.
``(c) Notwithstanding section 1326(b), the payments referred to in
subsection (a)(1)(A) shall be continued in addition to plan payments
under a confirmed plan until actual payments to the creditor begin
under that plan, if the confirmed plan provides--
``(1) for payments to a creditor or lessor described in
subsection (a)(1); and
``(2) for the deferral of payments to such creditor or
lessor under the plan until the payment of amounts described in
section 1326(b).
``(d) Notwithstanding sections 362, 542, and 543, a lessor or
creditor described in subsection (a) may retain possession of property
described in that subsection that was obtained in accordance with
applicable law before the date of filing of the petition until the
first payment under subsection (a)(1)(A) is received by the lessor or
creditor.
``(e) On or before 60 days after the filling of a case under this
chapter, a debtor retaining possession of personal property subject to
a lease or securing a claim attributable in whole or in part to the
purchase price of such property shall provide each creditor or lessor
reasonable evidence of the maintenance of any required insurance
coverage with respect to the use or ownership of such property and
continue to do so for so long as the debtor retains possession of such
property.''.
(b) Clerical Amendment.--The table of sections at the beginning of
chapter 13 of title 11, United States Code, is amended by inserting
after the item relating to section 1307 the following:
``1307A. Adequate protection in chapter 13 cases.''.
SEC. 136. AUTOMATIC STAY.
Section 362(b) of title 11, United States Code, as amended by
sections 118 and 132, is amended--
(1) in paragraph (20), by striking ``or'' at the end;
(2) in paragraph (21), by striking the period at the end
and inserting a semicolon; and
(3) by inserting after paragraph (21) the following:
``(22) under subsection (a) of any transfer that is not
avoidable under section 544 of this title and that is not
avoidable under section 549 of this title;
``(23) under subsection (a)(3), of the continuation of any
eviction, unlawful detainer action, or similar proceeding by a
lessor against a debtor involving residential real property in
which the debtor resides as a tenant under a rental agreement
and the debtor has not paid rent to the lessor pursuant to the
terms of the lease agreement or applicable State law after the
commencement and during the course of the case;
``(24) under subsection (a)(3), of the commencement or
continuation of any eviction, unlawful detainer action, or
similar proceeding by a lessor against a debtor involving
residential real property in which the debtor resides as a
tenant under a rental agreement that has terminated pursuant to
the lease agreement or applicable State law;
``(25) under subsection (a)(3), of any eviction, unlawful
detainer action, or similar proceeding, if the debtor has
previously filed within the last year and failed to pay post-
petition rent during the course of that case; or
``(26) under subsection (a)(3), of eviction actions based
on endangerment to property or person or the use of illegal
drugs.''.
SEC. 137. EXTEND PERIOD BETWEEN BANKRUPTCY DISCHARGES.
Title 11, United States Code, is amended--
(1) in section 727(a)(8) by striking ``six'' and inserting
``8''; and
(2) in section 1328 by adding at the end the following:
``(f) Notwithstanding subsections (a) and (b), the court shall not
grant a discharge of all debts provided for by the plan or disallowed
under section 502 of this title if the debtor has received a discharge
in any case filed under this title within 5 years of the order for
relief under this chapter.''.
SEC. 138. DEFINITION OF DOMESTIC SUPPORT OBLIGATION.
Section 101 of title 11, United States Code, is amended--
(1) by striking paragraph (12A); and
(2) by inserting after paragraph (14) the following:
``(14A) `domestic support obligation' means a debt that
accrues before or after the entry of an order for relief under
this title that is--
``(A) owed to or recoverable by--
``(i) a spouse, former spouse, or child of
the debtor or that child's legal guardian; or
``(ii) a governmental unit;
``(B) in the nature of alimony, maintenance, or
support (including assistance provided by a
governmental unit) of such spouse, former spouse, or
child, without regard to whether such debt is expressly
so designated;
``(C) established or subject to establishment
before or after entry of an order for relief under this
title, by reason of applicable provisions of--
``(i) a separation agreement, divorce
decree, or property settlement agreement;
``(ii) an order of a court of record; or
``(iii) a determination made in accordance
with applicable nonbankruptcy law by a
governmental unit; and
``(D) not assigned to a nongovernmental entity,
unless that obligation is assigned voluntarily by the
spouse, former spouse, child, or parent solely for the
purpose of collecting the debt.''.
SEC. 139. PRIORITIES FOR CLAIMS FOR DOMESTIC SUPPORT OBLIGATIONS.
Section 507(a) of title 11, United States Code, is amended--
(1) by striking paragraph (7);
(2) by redesignating paragraphs (1) through (6) as
paragraphs (2) through (7), respectively;
(3) in paragraph (2), as redesignated, by striking
``First'' and inserting ``Second'';
(4) in paragraph (3), as redesignated, by striking
``Second'' and inserting ``Third'';
(5) in paragraph (4), as redesignated, by striking
``Third'' and inserting ``Fourth'';
(6) in paragraph (5), as redesignated, by striking
``Fourth'' and inserting ``Fifth'';
(7) in paragraph (6), as redesignated, by striking
``Fifth'' and inserting ``Sixth'';
(8) in paragraph (7), as redesignated, by striking
``Sixth'' and inserting ``Seventh''; and
(9) by inserting before paragraph (2), as redesignated, the
following:
``(1) First, allowed claims for domestic support
obligations to be paid in the following order on the condition
that funds received under this paragraph by a governmental unit
in a case under this title be applied:
``(A) Claims that, as of the date of entry of the
order for relief, are owed directly to a spouse, former
spouse, or child of the debtor, or the parent of such
child, without regard to whether the claim is filed by
the spouse, former spouse, child, or parent, or is
filed by a governmental unit on behalf of that person.
``(B) Claims that, as of the date of entry of the
order for relief, are assigned by a spouse, former
spouse, child of the debtor, or the parent of that
child to a governmental unit or are owed directly to a
governmental unit under applicable nonbankruptcy
law.''.
SEC. 140. REQUIREMENTS TO OBTAIN CONFIRMATION AND DISCHARGE IN CASES
INVOLVING DOMESTIC SUPPORT OBLIGATIONS.
Title 11, United States Code, is amended--
(1) in section 1129(a), by adding at the end the following:
``(14) If the debtor is required by a judicial or
administrative order or statute to pay a domestic support
obligation, the debtor has paid all amounts payable under such
order or statute for such obligation that become payable after
the date on which the petition is filed.'';
(2) in section 1325(a)--
(A) in paragraph (5), by striking ``and'' at the
end;
(B) in paragraph (6), by striking the period at the
end and inserting ``; and''; and
(C) by adding at the end the following:
``(7) if the debtor is required by a judicial or
administrative order or statute to pay a domestic support
obligation, the debtor has paid all amounts payable under such
order for such obligation that become payable after the date on
which the petition is filed.''; and
(3) in section 1328(a), as amended by section 127, in the
matter preceding paragraph (1), by inserting ``, and with
respect to a debtor who is required by a judicial or
administrative order to pay a domestic support obligation,
certifies that all amounts payable under such order or statute
that are due on or before the date of the certification
(including amounts due before or after the petition was filed)
have been paid'' after ``completion by the debtor of all
payments under the plan''.
SEC. 141. EXCEPTIONS TO AUTOMATIC STAY IN DOMESTIC SUPPORT OBLIGATION
PROCEEDINGS.
Section 362(b) of title 11, United States Code, as amended by
sections 118, 132, and 136, is amended--
(1) by striking paragraph (2) and inserting the following:
``(2) under subsection (a)--
``(A) of the commencement or continuation of an
action or proceeding for--
``(i) the establishment of paternity; or
``(ii) the establishment or modification of
an order for domestic support obligations; or
``(B) the collection of a domestic support
obligation from property that is not property of the
estate;'';
(2) in paragraph (25), by striking ``or'' at the end;
(3) in paragraph (26), by striking the period at the end
and inserting a semicolon; and
(4) by inserting after paragraph (26) the following:
``(27) under subsection (a) with respect to the withholding
of income pursuant to an order as specified in section 466(b)
of the Social Security Act (42 U.S.C. 666(b)); or
``(28) under subsection (a) with respect to--
``(A) the withholding, suspension, or restriction
of drivers' licenses, professional and occupational
licenses, and recreational licenses pursuant to State
law, as specified in section 466(a)(16) of the Social
Security Act (42 U.S.C. 666(a)(16)) or with respect to
the reporting of overdue support owed by an absent
parent to any consumer reporting agency as specified in
section 466(a)(7) of the Social Security Act (42 U.S.C.
666(a)(7));
``(B) the interception of tax refunds, as specified
in sections 464 and 466(a)(3) of the Social Security
Act (42 U.S.C. 664 and 666(a)(3)); or
``(C) the enforcement of medical obligations as
specified under title IV of the Social Security Act (42
U.S.C. 601 et seq.).''.
SEC. 142. NONDISCHARGEABILITY OF CERTAIN DEBTS FOR ALIMONY,
MAINTENANCE, AND SUPPORT.
Section 523 of title 11, United States Code, is amended--
(1) in subsection (a), by striking paragraph (5) and
inserting the following:
``(5) for a domestic support obligation;'';
(2) in subsection (a)(15)--
(A) by inserting ``or'' after ``court of record,'';
(B) by striking ``unless--'' and all that follows
through ``debtor'' the last place it appears; and
(3) in subsection (c), by striking ``(6), or (15)'' each
place it appears and inserting ``or (6)''.
SEC. 143. CONTINUED LIABILITY OF PROPERTY.
Section 522 of title 11, United States Code, is amended--
(1) in subsection (c), by striking paragraph (1) and
inserting the following:
``(1) a debt of a kind specified in paragraph (1) or (5) of
section 523(a) (in which case, notwithstanding any provision of
applicable nonbankruptcy law to the contrary, such property
shall be liable for a debt of a kind specified in section
523(a)(5);''; and
(2) in subsection (f)(1)(A), by striking the dash and all
that follows through the end of the subparagraph and inserting
``of a kind that is specified in section 523(a)(5); or''.
SEC. 144. PROTECTION OF DOMESTIC SUPPORT CLAIMS AGAINST PREFERENTIAL
TRANSFER MOTIONS.
Section 547(c)(7) of title 11, United States Code, is amended to
read as follows:
``(7) to the extent such transfer was a bona fide payment
of a debt for a domestic support obligation; or''.
SEC. 145. CLARIFICATION OF MEANING OF HOUSEHOLD GOODS.
Section 101 of title 11, United States Code, is amended by
inserting after paragraph (27) the following:
``(27A) `household goods' includes tangible personal
property normally found in or around a residence, but does not
include motorized vehicles used for transportation purposes;''.
SEC. 146. NONDISCHARGEABLE DEBTS.
Section 523(a) of title 11, United States Code, is amended by
inserting after paragraph (14) the following:
``(14A) incurred to pay a debt that is nondischargeable by
reason of section 727, 1141, 1228(a), 1228(b), or 1328(c), or
any other provision of this subsection, if the debtor incurred
the debt to pay such a nondischargeable debt with the intent to
discharge in bankruptcy the newly-created debt, except that all
debts incurred to pay nondischargeable debts, without regard to
intent, are nondischargeable if incurred within 90 days of the
filing of the petition;''.
SEC. 147. MONETARY LIMITATION ON CERTAIN EXEMPT PROPERTY.
Section 522 of title 11, United States Code, as amended by section
125, is amended--
(1) in subsection (b)(2)(A) by striking ``subsection (o)''
and inserting ``subsections (o) and (p)'' before ``any
property''; and
(2) by adding at the end the following:
``(p)(1) Except as provided in paragraphs (2) and (3), as a result
of electing under subsection (b)(3)(A) to exempt property under State
or local law, a debtor may not exempt any interest that exceeds
$250,000 in value, in the aggregate, in--
``(A) real or personal property that the debtor or a
dependent of the debtor uses as a residence;
``(B) a cooperative that owns property that the debtor or a
dependent of the debtor uses as a residence; or
``(C) a burial plot for the debtor or a dependent of the
debtor.
``(2) The limitation under paragraph (1) shall not apply to an
exemption claimed under subsection (b)(3)(A) by a family farmer for the
principal residence of that farmer.
``(3) Paragraph (1) shall not apply to debtors if applicable State
law expressly provides by a statute enacted after the effective date of
this paragraph that such paragraph shall not apply to debtors.''.
SEC. 148. BANKRUPTCY FEES.
Section 1930 of title 28, United States Code, is amended--
(1) in subsection (a) by striking ``Notwithstanding section
1915 of this title, the'' and inserting ``The''; and
(2) by adding at the end the following:
``(f)(1) Pursuant to procedures prescribed by the Judicial
Conference of the United States, the district court or the bankruptcy
court may waive the filing fee in a case under chapter 7 of title 11
for an individual debtor who is unable to pay such fee in installments.
For purposes of this paragraph, the term `filing fee' means the filing
fee required by subsection (a), or any other fee prescribed by the
Judicial Conference under subsections (b) and (c) that is payable to
the clerk upon the commencement of a case under chapter 7 of title 11.
``(2) The district court or the bankruptcy court may also waive for
such debtors other fees prescribed pursuant to subsections (b) and (c).
``(3) This subsection does not restrict the district court or the
bankruptcy court from waiving, in accordance with Judicial Conference
policy, fees prescribed pursuant to such subsections for other debtors
and creditors.''.
SEC. 149. COLLECTION OF CHILD SUPPORT.
(a) Duties of Trustee Under Chapter 7.--Section 704 of title 11,
United States Code, as amended by section 102, is amended--
(1) by inserting ``(a)'' before ``The trustee'',
(2) in paragraph (9) by striking ``and'' at the end,
(3) in paragraph (10) by striking the period and inserting
``; and'', and
(4) by adding at the end the following:
``(11) if, with respect to an individual debtor, there is a
claim for support of a child of the debtor or a custodial
parent of such child entitled to receive priority under section
507(a)(1) of this title, provide the applicable notification
specified in subsection (b).
``(b)(1) In any case described in subsection (a)(11), the trustee
shall--
``(A)(i) notify in writing the holder of the claim of the
right of such holder to use the services of a State child
support enforcement agency established under sections 464 and
466 of the Social Security Act for the State in which the
holder resides; and
``(ii) include in the notice under this paragraph the
address and telephone number of the child support enforcement
agency; and
``(B)(i) notify in writing the State child support agency
of the State in which the holder of the claim resides of the
claim;
``(ii) include in the notice under this paragraph the name,
address, and telephone number of the holder of the claim; and
``(iii) at such time as the debtor is granted a discharge
under section 727 of this title, notify the holder of such
claim and the State child support agency of the State in which
such holder resides of--
``(I) the granting of the discharge;
``(II) the last recent known address of the debtor;
and
``(III) with respect to the debtor's case, the name
of each creditor that holds a claim that is not
discharged under paragraph (2), (4), or (14A) of
section 523(a) of this title or that was reaffirmed by
the debtor under section 524(c) of this title.
``(2)(A) If, after receiving a notice under paragraph (1)(B)(iii),
a holder of a claim or a State child support agency is unable to locate
the debtor that is the subject of the notice, such holder or such
agency may request from a creditor described in paragraph
(1)(B)(iii)(III) the last known address of the debtor.
``(B) Notwithstanding any other provision of law, a creditor that
makes a disclosure of a last known address of a debtor in connection
with a request made under subparagraph (A) shall not be liable to the
debtor or any other person by reason of making such disclosure.''.
(b) Duties of Trustee Under Chapter 13.--Section 1302 of title 11,
United States Code, is amended--
(1) in subsection (b)--
(A) in paragraph (4) by striking ``and'' at the
end,
(B) in paragraph (5) by striking the period and
inserting ``; and'', and
(C) by adding at the end the following:
``(6) if, with respect to an individual debtor, there is a
claim for support of a child of the debtor or a custodial
parent of such child entitled to receive priority under section
507(a)(1) of this title, provide the applicable notification
specified in subsection (d).'', and
(2) by adding at the end the following:
``(d)(1) In any case described in subsection (b)(6), the trustee
shall--
``(A)(i) notify in writing the holder of the claim of the
right of such holder to use the services of a State child
support enforcement agency established under sections 464 and
466 of the Social Security Act for the State in which the
holder resides; and
``(ii) include in the notice under this paragraph the
address and telephone number of the child support enforcement
agency; and
``(B)(i) notify in writing the State child support agency
of the State in which the holder of the claim resides of the
claim; and
``(ii) include in the notice under this paragraph the name,
address, and telephone number of the holder of the claim;
``(iii) at such time as the debtor is granted a discharge
under section 1328 of this title, notify the holder of the
claim and the State child support agency of the State in which
such holder resides of--
``(I) the granting of the discharge;
``(II) the last recent known address of the debtor;
and
``(III) with respect to the debtor's case, the name
of each creditor that holds a claim that is not
discharged under paragraph (2), (4), or (14A) of
section 523(a) of this title or that was reaffirmed by
the debtor under section 524(c) of this title.
``(2)(A) If, after receiving a notice under paragraph (1)(B)(iii),
a holder of a claim or a State child support agency is unable to locate
the debtor that is the subject of the notice, such holder or such
agency may request from a creditor described in paragraph (1)(B)(iii)
the last known address of the debtor.
``(B) Notwithstanding any other provision of law, a creditor that
makes a disclosure of a last known address of a debtor in connection
with a request made under subparagraph (A) shall not be liable to the
debtor or any other person by reason of making such disclosure.''.
SEC. 150. EXCLUDING EMPLOYEE BENEFIT PLAN PARTICIPANT CONTRIBUTIONS AND
OTHER PROPERTY FROM THE ESTATE.
(a) In General.--Section 541(b) of title 11 of the United States
Code is amended--
(1) by striking ``or'' at the end of paragraph (4)(B)(ii);
(2) by striking the period at the end of paragraph (5) and
inserting ``; or''; and
(3) by inserting after paragraph (5) the following:
``(7) any amount or interest in property to the extent that
an employer has withheld amounts from the wages of employees
for contribution to an employee benefit plan subject to title I
of the Employee Retirement Income Security Act of 1974, or to
the extent that the employer has received amounts as a result
of payments by participants or beneficiaries to an employer for
contribution to an employee benefit plan subject to title I of
the Employee Retirement Income Security Act of 1974.''.
(b) Application of Amendment.--The amendment made by this section
shall not apply to cases commenced under title 11 of the United States
Code before the expiration of the 180-day period beginning on the date
of the enactment of this Act.
SEC. 151. CLARIFICATION OF POSTPETITION WAGES AND BENEFITS.
Section 503(b)(1)(A) of title 11, United States Code, is amended to
read as follows:
``(A) the actual, necessary costs and expenses of
preserving the estate, including wages, salaries, or
commissions for services rendered after the commencement of the
case, and wages and benefits attributable to any period of time
after commencement of the case as a result of the debtor's
violation of Federal law, without regard to when the original
unlawful act occurred or to whether any services were
rendered;''.
SEC. 152. EXCEPTIONS TO AUTOMATIC STAY IN DOMESTIC SUPPORT OBLIGATION
PROCEEDINGS.
Section 362(b)(2) of title 11, United States Code, is amended--
(1) in subparagraph (A) by striking ``or'' at the end;
(2) in subparagraph (B) by adding ``or'' at the end; and
(3) by adding at the end the following:
``(C) under subsection (a) of--
``(i) the withholding of income for payment
of a domestic support obligation pursuant to a
judicial or administrative order or statute for
such obligation that first becomes payable
after the date on which the petition is filed;
or
``(ii) the withholding of income for
payment of a domestic support obligation owed
directly to the spouse, former spouse or child
of the debtor or the parent of such child,
pursuant to a judicial or administrative order
or statute for such obligation that becomes
payable before the date on which the petition
is filed unless the court finds, after notice
and hearing, that such withholding would render
the plan infeasible;''.
SEC. 153. AUTOMATIC STAY INAPPLICABLE TO CERTAIN PROCEEDINGS AGAINST
THE DEBTOR.
Section 362(b)(2) of title 11, United States Code, as amended by
section 153, is amended--
(1) in subparagraph (B) by striking ``or'' at the end;
(2) by inserting after subparagraph (C) the following:
``(D) the commencement or continuation of a
proceeding concerning a child custody or visitation;
``(E) the commencement or continuation of a
proceeding alleging domestic violence; or
``(F) the commencement or continuation of a
proceeding seeking a dissolution of marriage, except to
the extent the proceeding concerns property of the
estate;''.
TITLE II--DISCOURAGING BANKRUPTCY ABUSE
SEC. 201. REENACTMENT OF CHAPTER 12.
(a) Reenactment.--Chapter 12 of title 11 of the United States Code,
as in effect on March 31, 1999, is hereby reenacted.
(b) Effective Date.--The amendment made by subsection (a) shall
take effect on March 31, 1999.
SEC. 202. MEETINGS OF CREDITORS AND EQUITY SECURITY HOLDERS.
Section 341 of title 11, United States Code, is amended by adding
at the end the following:
``(e) Notwithstanding subsections (a) and (b), the court, on the
request of a party in interest and after notice and a hearing, for
cause may order that the United States trustee not convene a meeting of
creditors or equity security holders if the debtor has filed a plan as
to which the debtor solicited acceptances prior to the commencement of
the case.''.
SEC. 203. PROTECTION OF RETIREMENT SAVINGS IN BANKRUPTCY.
(a) In General.--Section 522 of title 11, United States Code, as
amended by sections 113, 125, and 147 is amended--
(1) in subsection (b)--
(A) in paragraph (2)--
(i) by striking ``(2)(A)'' and inserting:
``(3) Property listed in this paragraph is--
``(A) subject to subsections (o) and (p),'';
(ii) in subparagraph (B), by striking
``and'' at the end;
(iii) in subparagraph (C), by striking the
period at the end and inserting ``; and''; and
(iv) by adding at the end the following:
``(D) retirement funds to the extent that those funds are
in a fund or account that is exempt from taxation under section
401, 403, 408, 408A, 414, 457, or 501(a) of the Internal
Revenue Code of 1986.'';
(B) by striking paragraph (1) and inserting:
``(2) Property listed in this paragraph is property that is
specified under subsection (d), unless the State law that is applicable
to the debtor under paragraph (3)(A) specifically does not so
authorize.'';
(C) in the matter preceding paragraph (2)--
(i) by striking ``(b)'' and inserting
``(b)(1)'';
(ii) by striking ``paragraph (2)'' both
places it appears and inserting ``paragraph
(3)'';
(iii) by striking ``paragraph (1)'' each
place it appears and inserting ``paragraph
(2)''; and
(iv) by striking ``Such property is--'';
and
(D) by adding at the end of the subsection the
following:
``(4) For purposes of paragraph (3)(D) and subsection (d)(12), the
following shall apply:
``(A) If the retirement funds are in a retirement fund that
has received a favorable determination pursuant to section 7805
of the Internal Revenue Code of 1986, and that determination is
in effect as of the date of the commencement of the case under
section 301, 302, or 303 of this title, those funds shall be
presumed to be exempt from the estate.
``(B) If the retirement funds are in a retirement fund that
has not received a favorable determination pursuant to such
section 7805, those funds are exempt from the estate if the
debtor demonstrates that--
``(i) no prior determination to the contrary has
been made by a court or the Internal Revenue Service;
and
``(ii) the retirement fund is in substantial
compliance with the applicable requirements of the
Internal Revenue Code of 1986.
``(C) A direct transfer of retirement funds from 1 fund or
account that is exempt from taxation under section 401, 403,
408, 408A, 414, 457, or 501(a) of the Internal Revenue Code of
1986, pursuant to section 401(a)(31) of the Internal Revenue
Code of 1986, or otherwise, shall not cease to qualify for
exemption under paragraph (3)(D) or subsection (d)(12) by
reason of that direct transfer.
``(D)(i) Any distribution that qualifies as an eligible
rollover distribution within the meaning of section 402(c) of
the Internal Revenue Code of 1986 or that is described in
clause (ii) shall not cease to qualify for exemption under
paragraph (3)(D) or subsection (d)(12) by reason of that
distribution.
``(ii) A distribution described in this clause is an amount
that--
``(I) has been distributed from a fund or account
that is exempt from taxation under section 401, 403,
408, 408A, 414, 457, or 501(a) of the Internal Revenue
Code of 1986; and
``(II) to the extent allowed by law, is deposited
in such a fund or account not later than 60 days after
the distribution of that amount.''; and
(2) in subsection (d)--
(A) in the matter preceding paragraph (1), by
striking ``subsection (b)(1)'' and inserting
``subsection (b)(2)''; and
(B) by adding at the end the following:
``(12) Retirement funds to the extent that those funds are
in a fund or account that is exempt from taxation under section
401, 403, 408, 408A, 414, 457, or 501(a) of the Internal
Revenue Code of 1986.''.
(b) Automatic Stay.--Section 362(b) of title 11, United States
Code, as amended by sections 118, 132, 136, and 141 is amended--
(1) in paragraph (27), by striking ``or'' at the end;
(2) in paragraph (28), by striking the period and inserting
``; or'';
(3) by inserting after paragraph (28) the following:
``(29) under subsection (a), of withholding of income from
a debtor's wages and collection of amounts withheld, pursuant
to the debtor's agreement authorizing that withholding and
collection for the benefit of a pension, profit-sharing, stock
bonus, or other plan established under section 401, 403, 408,
408A, 414, 457, or 501(a) of the Internal Revenue Code of 1986
that is sponsored by the employer of the debtor, or an
affiliate, successor, or predecessor of such employer--
``(A) to the extent that the amounts withheld and
collected are used solely for payments relating to a
loan from a plan that satisfies the requirements of
section 408(b)(1) of the Employee Retirement Income
Security Act of 1974 or is subject to section 72(p) of
the Internal Revenue Code of 1986; or
``(B) in the case of a loan from a thrift savings
plan described in subchapter III of title 5, that
satisfies the requirements of section 8433(g) of such
title.''; and
(4) by adding at the end of the flush material following
paragraph (29) the following: ``Paragraph (29) does not apply
to any amount owed to a plan referred to in that paragraph that
is incurred under a loan made during the 1-year period preceding the
filing of a petition. Nothing in paragraph (29) may be construed to
provide that any loan made under a governmental plan under section
414(d), or a contract or account under section 403(b), of the Internal
Revenue Code of 1986 constitutes a claim or a debt under this title.''.
(c) Exceptions to Discharge.--Section 523(a) of title 11, United
States Code, is amended--
(1) by striking ``or'' at the end of paragraph (17);
(2) by striking the period at the end of paragraph (18) and
inserting ``; or''; and
(3) by adding at the end the following:
``(19) owed to a pension, profit-sharing, stock bonus, or
other plan established under section 401, 403, 408, 408A, 414,
457, or 501(c) of the Internal Revenue Code of 1986, pursuant
to--
``(A) a loan permitted under section 408(b)(1) of
the Employee Retirement Income Security Act of 1974) or
subject to section 72(p) of the Internal Revenue Code
of 1986; or
``(B) a loan from the thrift savings plan described
in subchapter III of title 5, that satisfies the
requirements of section 8433(g) of such title.
Paragraph (19) does not apply to any amount owed to a plan referred to
in that paragraph that is incurred under a loan made during the 1-year
period preceding the filing of a petition. Nothing in paragraph (19)
may be construed to provide that any loan made under a governmental
plan under section 414(d), or a contract or account under section
403(b), of the Internal Revenue Code of 1986 constitutes a claim or a
debt under this title.''.
(d) Plan Contents.--Section 1322 of title 11, United States Code,
is amended by adding at the end the following:
``(f) A plan may not materially alter the terms of a loan described
in section 362(b)(29) of this title.''.
SEC. 204. PROTECTION OF REFINANCE OF SECURITY INTEREST.
Subparagraphs (A), (B), and (C) of section 547(e)(2) of title 11,
United States Code, are amended by striking ``10'' each place it
appears and inserting ``30''.
SEC. 205. EXECUTORY CONTRACTS AND UNEXPIRED LEASES.
Section 365(d)(4) of title 11, United States Code, is amended to
read as follows:
``(4)(A) Subject to subparagraph (B), in any case under any chapter
in this title, an unexpired lease of nonresidential real property under
which the debtor is the lessee shall be deemed rejected, and the
trustee shall immediately surrender such property to the lessor, if the
trustee does not assume or reject the unexpired lease by the earlier
of--
``(i) the date that is 120 days after the date of the order
for relief; or
``(ii) the date of the entry of an order confirming a plan.
``(B)(i) The court may extend the period determined under
subparagraph (A) for 120 days upon motion of the trustee or the lessor
for cause.
``(ii) If the court grants an extension under clause (i), the court
may grant a subsequent extension only upon prior written consent of the
lessor.''.
SEC. 206. CREDITORS AND EQUITY SECURITY HOLDERS COMMITTEES.
Section 1102(a)(2) of title 11, United States Code, is amended by
inserting before the first sentence the following: ``On its own motion
or on request of a party in interest, and after notice and hearing, the
court may order a change in the membership of a committee appointed
under this subsection, if the court determines that the change is
necessary to ensure adequate representation of creditors or equity
security holders.''.
SEC. 207. AMENDMENT TO SECTION 546 OF TITLE 11, UNITED STATES CODE.
Section 546 of title 11, United States Code, is amended by
inserting at the end thereof:
``(i) Notwithstanding section 545 (2) and (3) of this title, the
trustee may not avoid a warehouseman's lien for storage, transportation
or other costs incidental to the storage and handling of goods, as
provided by section 7-209 of the Uniform Commercial Code.''.
SEC. 208. LIMITATION.
Section 546(c)(1)(B) of title 11, United States Code, is amended by
striking ``20'' and inserting ``45''.
SEC. 209. AMENDMENT TO SECTION 330(A) OF TITLE 11, UNITED STATES CODE.
Section 330(a) of title 11, United States Code, is amended--
(1) in paragraph (3)--
(A) in subparagraph (A) after ``awarded'', by
inserting ``to an examiner, chapter 11 trustee, or
professional person''; and
(B) by redesignating subdivisions (A) through (E)
as clauses (i) through (iv), respectively; and
(2) by adding at the the following:
``(B) In determining the amount of reasonable compensation
to be awarded a trustee, the court shall treat such
compensation as a commission based on the results achieved.''.
SEC. 210. POSTPETITION DISCLOSURE AND SOLICITATION.
Section 1125 of title 11, United States Code, is amended by adding
at the end the following:
``(g) Notwithstanding subsection (b), an acceptance or rejection of
the plan may be solicited from a holder of a claim or interest if such
solicitation complies with applicable nonbankruptcy law and if such
holder was solicited before the commencement of the case in a manner
complying with applicable nonbankruptcy law.''.
SEC. 211. PREFERENCES.
Section 547(c) of title 11, United States Code, is amended--
(1) by amending paragraph (2) to read as follows:
``(2) to the extent that such transfer was in payment of a
debt incurred by the debtor in the ordinary course of business
or financial affairs of the debtor and the transferee, and such
transfer was--
``(A) made in the ordinary course of business or
financial affairs of the debtor and the transferee; or
``(B) made according to ordinary business terms;'';
(2) in paragraph (7) by striking ``or'' at the end;
(3) in paragraph (8) by striking the period at the end and
inserting ``; or''; and
(4) by adding at the end the following:
``(9) if, in a case filed by a debtor whose debts are not
primarily consumer debts, the aggregate value of all property
that constitutes or is affected by such transfer is less than
$5,000.''.
SEC. 212. VENUE OF CERTAIN PROCEEDINGS.
Section 1409(b) of title 28, United States Code, is amended by
inserting ``, or a nonconsumer debt against a noninsider of less than
$10,000,'' after ``$5,000''.
SEC. 213. PERIOD FOR FILING PLAN UNDER CHAPTER 11.
Section 1121(d) of title 11, United States Code, is amended--
(1) by striking ``On'' and inserting ``(1) Subject to
paragraph (1), on''; and
(2) by adding at the end the following:
``(2)(A) Such 120-day period may not be extended beyond a date that
is 18 months after the date of the order for relief under this chapter.
``(B) Such 180-day period may not be extended beyond a date that is
20 months after the date of the order for relief under this chapter.''.
SEC. 214. FEES ARISING FROM CERTAIN OWNERSHIP INTERESTS.
Section 523(a)(16) of title 11, United States Code, is amended--
(1) by striking ``dwelling'' the first place it appears;
(2) by striking ``ownership or'' and inserting
``ownership,'';
(3) by striking ``housing'' the first place it appears; and
(4) by striking ``but only'' and all that follows through
``such period,'', and inserting ``or a lot in a homeowners
association, for as long as the debtor or the trustee has a
legal, equitable, or possessory ownership interest in such
unit, such corporation, or such lot,''.
SEC. 215. CLAIMS RELATING TO INSURANCE DEPOSITS IN CASES ANCILLARY TO
FOREIGN PROCEEDINGS.
Section 304 of title 11, United States Code, is amended to read as
follows:
``Sec. 304. Cases ancillary to foreign proceedings
``(a) For purposes of this section--
``(1) the term `domestic insurance company' means a
domestic insurance company, as such term is used in section
109(b)(2);
``(2) the term `foreign insurance company' means a foreign
insurance company, as such term is used in section 109(b)(3);
``(3) the term `United States claimant' means a beneficiary
of any deposit referred to in subsection (b) or any
multibeneficiary trust referred to in subsection (b);
``(4) the term `United States creditor' means, with respect
to a foreign insurance company--
``(A) a United States claimant; or
``(B) any business entity that operates in the
United States and that is a creditor; and
``(5) the term `United States policyholder' means a holder
of an insurance policy issued in the United States.
``(b) The court may not grant relief under chapter 15 of this title
with respect to any deposit, escrow, trust fund, or other security
required or permitted under any applicable State insurance law or
regulation for the benefit of claim holders in the United States.''.
SEC. 216. DEFAULTS BASED ON NONMONETARY OBLIGATIONS.
(a) Executory Contracts and Unexpired Leases.--Section 365 of title
11, United States Code, is amended--
(1) in subsection (b)--
(A) in paragraph (1)(A) by striking the semicolon
at the end and inserting the following:
``other than a default that is a breach of a provision relating
to--
``(i) the satisfaction of any provision (other than
a penalty rate or penalty provision) relating to a
default arising from any failure to perform nonmonetary
obligations under an unexpired lease of real property
(excluding executory contracts that transfer a right or
interest under a filed or issued patent, copyright,
trademark, trade dress, or trade secret), if it is
impossible for the trustee to cure such default by
performing nonmonetary acts at and after the time of
assumption; or
``(ii) the satisfaction of any provision (other
than a penalty rate or penalty provision) relating to a
default arising from any failure to perform nonmonetary
obligations under an executory contract, if it is
impossible for the trustee to cure such default by
performing nonmonetary acts at and after the time of
assumption and if the court determines, based on the
equities of the case, that this subparagraph should not
apply with respect to such default;''; and
(B) by amending paragraph (2)(D) to read as
follows:
``(D) the satisfaction of any penalty rate or penalty
provision relating to a default arising from a failure to
perform nonmonetary obligations under an executory contract
(excluding executory contracts that transfer a right or
interest under a filed or issued patent, copyright, trademark,
trade dress, or trade secret) or under an unexpired lease of
real or personal property.'';
(2) in subsection (c)--
(A) in paragraph (2) by adding ``or'' at the end;
(B) in paragraph (3) by striking ``; or'' at the
end and inserting a period; and
(C) by striking paragraph (4);
(3) in subsection (d)--
(A) by striking paragraphs (5) through (9); and
(B) by redesignating paragraph (10) as paragraph
(5); and
(4) in subsection (f)(1) by striking ``; except that'' and
all that follows through the end of the paragraph and inserting
a period.
(b) Impairment of Claims or Interests.--Section 1124(2) of title
11, United States Code, is amended--
(1) in subparagraph (A) by inserting ``or of a kind that
section 365(b)(1)(A) of this title expressly does not require
to be cured'' before the semicolon at the end;
(2) in subparagraph (C) by striking ``and'' at the end;
(3) by redesignating subparagraph (D) as subparagraph (E);
and
(4) by inserting after subparagraph (C) the following:
``(D) if such claim or such interest arises from
any failure to perform a nonmonetary obligation,
compensates the holder of such claim or such interest
(other than the debtor or an insider) for any actual
pecuniary loss incurred by such holder as a result of
such failure; and''.
SEC. 217. SHARING OF COMPENSATION.
Section 504 of title 11, United States Code, is amended by adding
at the end the following:
``(c) This section shall not apply with respect to sharing, or
agreeing to share, compensation with a bona fide public service
attorney referral program that operates in accordance with non-Federal
law regulating attorney referral services and with rules of
professional responsibility applicable to attorney acceptance of
referrals.''.
SEC. 218. PRIORITY FOR ADMINISTRATIVE EXPENSES.
Section 503(b) of title 11, United States Code, is amended--
(1) by deleting ``and'' at the end of paragraph (5);
(2) by striking the period at the end of paragraph (6) and
inserting ``; and'';
(3) by inserting the following after paragraph (6):
``(7) with respect to a nonresidential real property lease
previously assumed under section 365, and subsequently
rejected, a sum equal to all monetary obligations due,
excluding those arising from or relating to a failure to
operate or penalty provisions, for the period of one year
following the later of the rejection date or date of actual
turnover of the premises, without reduction or setoff for any
reason whatsoever except for sums actually received or to be
received from a nondebtor; and the claim for remaining sums due
for the balance of the term of the lease shall be a claim under
section 502(b)(6).''.
TITLE III--GENERAL BUSINESS BANKRUPTCY PROVISIONS
SEC. 301. DEFINITION OF DISINTERESTED PERSON.
Section 101(14) of title 11, United States Code, is amended to read
as follows:
``(14) `disinterested person' means a person that--
``(A) is not a creditor, an equity security holder,
or an insider;
``(B) is not and was not, within 2 years before the
date of the filing of the petition, a director,
officer, or employee of the debtor; and
``(C) does not have an interest materially adverse
to the interest of the estate or of any class of
creditors or equity security holders, by reason of any
direct or indirect relationship to, connection with, or
interest in, the debtor, or for any other reason;''.
SEC. 302. MISCELLANEOUS IMPROVEMENTS.
(a) Who May Be a Debtor.--Section 109 of title 11, United States
Code, is amended by adding at the end the following:
``(h)(1) Subject to paragraphs (2) and (3) and notwithstanding any
other provision of this section, an individual may not be a debtor
under this title unless that individual has, during the 90-day period
preceding the date of filing of the petition of that individual,
received credit counseling, including, at a minimum, participation in
an individual or group briefing that outlined the opportunities for
available credit counseling and assisted that individual in performing
an initial budget analysis, through a credit counseling program
(offered through an approved credit counseling service described in
section 111(a)).
``(2)(A) Paragraph (1) shall not apply with respect to a debtor who
resides in a district for which the United States trustee or bankruptcy
administrator of the bankruptcy court of that district determines that
the approved credit counseling services for that district are not
reasonably able to provide adequate services to the additional
individuals who would otherwise seek credit counseling from those
programs by reason of the requirements of paragraph (1).
``(B) Each United States trustee or bankruptcy administrator that
makes a determination described in subparagraph (A) shall review that
determination not later than one year after the date of that
determination, and not less frequently than every year thereafter.
``(3)(A) Subject to subparagraph (B), the requirements of paragraph
(1) shall not apply with respect to a debtor who submits to the court a
certification that--
``(i) describes exigent circumstances that merit a waiver
of the requirements of paragraph (1);
``(ii) states that the debtor requested credit counseling
services from an approved credit counseling service, but was
unable to obtain the services referred to in paragraph (1)
during the 5-day period beginning on the date on which the
debtor made that request or that the exigent circumstances
require filing before such 5-day period expires; and
``(iii) is satisfactory to the court.
``(B) With respect to a debtor, an exemption under subparagraph (A)
shall cease to apply to that debtor on the date on which the debtor
meets the requirements of paragraph (1), but in no case may the
exemption apply to that debtor after the date that is 30 days after the
debtor files a petition.''.
(b) Chapter 7 Discharge.--Section 727(a) of title 11, United States
Code, is amended--
(1) in paragraph (9), by striking ``or'' at the end;
(2) in paragraph (10), by striking the period and inserting
``; or''; and
(3) by adding at the end the following:
``(11) after the filing of the petition, the debtor failed
to complete an instructional course concerning personal
financial management described in section 111 unless the debtor
resides in a district for which the United States trustee or
bankruptcy administrator of the bankruptcy court of that
district determines that the approved instructional courses are
not adequate to provide service to the additional individuals
who would be required to compete the instructional course by
reason of the requirements of this section. Each United States
trustee or bankruptcy administrator that makes such a
determination shall review that determination not later than 1
year after the date of that determination, and not less
frequently than every year thereafter.''.
(c) Chapter 13 Discharge.--Section 1328 of title 11, United States
Code, as amended by section 137, is amended by adding at the end the
following:
``(g) The court shall not grant a discharge under this section to a
debtor, unless after filing a petition the debtor has completed an
instructional course concerning personal financial management described
in section 111.
``(h) Subsection (g) shall not apply with respect to a debtor who
resides in a district for which the United States trustee or bankruptcy
administrator of the bankruptcy court of that district determines that
the approved instructional courses are not adequate to provide service
to the additional individuals who would be required to complete the
instructional course by reason of the requirements of this section.
``(i) Each United States trustee or bankruptcy administrator that
makes a determination described in subsection (h) shall review that
determination not later than 1 year after the date of that
determination, and not less frequently than every year thereafter.''.
(d) Debtor's Duties.--Section 521 of title 11, United States Code,
as amended by sections 604 and 120, is amended by adding at the end the
following:
``(d) In addition to the requirements under subsection (a), an
individual debtor shall file with the court--
``(1) a certificate from the credit counseling service that
provided the debtor services under section 109(h); and
``(2) a copy of the debt repayment plan, if any, developed
under section 109(h) through the credit counseling service
referred to in paragraph (1).''.
(e) General Provisions.--
(1) In general.--Chapter 1 of title 11, United States Code,
is amended by adding at the end the following:
``Sec. 111. Credit counseling services; financial management
instructional courses
``The clerk of each district shall maintain a list of credit
counseling services that provide 1 or more programs described in
section 109(h) and a list of instructional courses concerning personal
financial management that have been approved by--
``(1) the United States trustee; or
``(2) the bankruptcy administrator for the district.''.
(2) Clerical amendment.--The table of sections at the
beginning of chapter 1 of title 11, United States Code, is
amended by adding at the end the following:
``111. Credit counseling services; financial management instructional
courses.''.
(e) Definitions.--Section 101 of title 11, United States Code, is
amended--
(1) by inserting after paragraph (13) the following:
``(13A) `debtor's principal residence' means a residential
structure including incidental property when the structure
contains 1 to 4 units, whether or not that structure is
attached to real property, and includes, without limitation, an
individual condominium or cooperative unit or mobile or
manufactured home or trailer;'';
(2) by inserting after paragraph (27A), as added by section
318 of this Act, the following:
``(27B) `incidental property' means property incidental to
such residence including, without limitation, property commonly
conveyed with a principal residence where the real estate is
located, window treatments, carpets, appliances and equipment
located in the residence, and easements, appurtenances,
fixtures, rents, royalties, mineral rights, oil and gas rights,
escrow funds and insurance proceeds;'';
(3) in section 362(b), as amended by sections 117, 118,
132, 136, 141 203, 818, and 1007,--
(A) in paragraph (28) by striking ``or'' at the end
thereof;
(B) in paragraph (29) by striking the period at the
end and inserting ``; or''; and
(C) by inserting after paragraph (29) the
following:
``(30) under subsection (a), until a prepetition default is
cured fully in a case under chapter 13 of this title by actual
payment of all arrears as required by the plan, of the
postponement, continuation or other similar delay of a
prepetition foreclosure proceeding or sale in accordance with
applicable nonbankruptcy law, but nothing herein shall imply
that such postponement, continuation or other similar delay is
a violation of the stay under subsection (a).''; and
(4) by amending section 1322(b)(2) to read as follows:
``(2) modify the rights of holders of secured claims, other
than a claim secured primarily by a security interest in
property used as the debtor's principal residence at any time
during 180 days prior to the filing of the petition, or of
holders of unsecured claims, or leave unaffected the rights of
holders of any class of claims;''.
(f) Limitation.--Section 362 of title 11, United States Code, is
amended by adding at the end the following:
``(j) If one case commenced under chapter 7, 11, or 13 of this
title is dismissed due to the creation of a debt repayment plan
administered by a credit counseling agency approved pursuant to section
111 of this title, then for purposes of section 362(c)(3) of this title
the subsequent case commenced under any such chapter shall not be
presumed to be filed not in good faith.''.
(g) Return of Goods Shipped.--Section 546(g) of title 11, United
States Code, as added by section 222(a) of Public Law 103-394, is
amended to read as follows:
``(h) Notwithstanding the rights and powers of a trustee under
sections 544(a), 545, 547, 549, and 553 of this title, if the court
determines on a motion by the trustee made not later than 120 days
after the date of the order for relief in a case under chapter 11 of
this title and after notice and hearing, that a return is in the best
interests of the estate, the debtor, with the consent of the creditor,
and subject to the prior rights, if any, of third parties in such
goods, may return goods shipped to the debtor by the creditor before
the commencement of the case, and the creditor may offset the purchase
price of such goods against any claim of the creditor against the
debtor that arose before the commencement of the case.''.
SEC. 303. EXTENSIONS.
Section 302(d)(3) of the Bankruptcy, Judges, United States
Trustees, and Family Farmer Bankruptcy Act of 1986 (28 U.S.C. 581 note)
is amended--
(1) in subparagraph (A), in the matter following clause
(ii), by striking ``or October 1, 2002, whichever occurs
first''; and
(2) in subparagraph (F)--
(A) in clause (i)--
(i) in subclause (II), by striking ``or
October 1, 2002, whichever occurs first''; and
(ii) in the matter following subclause
(II), by striking ``October 1, 2003, or''; and
(B) in clause (ii), in the matter following
subclause (II)--
(i) by striking ``before October 1, 2003,
or''; and
(ii) by striking ``, whichever occurs
first''.
SEC. 304. LOCAL FILING OF BANKRUPTCY CASES.
Section 1408 of title 28, United States Code, is amended--
(1) by striking ``Except'' and inserting ``(a) Except'';
and
(2) by adding at the end the following:
``(b) For the purposes of subsection (a), if the debtor is a
corporation, the domicile and residence of the debtor are conclusively
presumed to be where the debtor's principal place of business in the
United States is located.''.
SEC. 305. PERMITTING ASSUMPTION OF CONTRACTS.
(a) Section 365(c) of title 11, United States Code, is amended to
read as follows:
``(c)(1) The trustee may not assume or assign an executory contract
or unexpired lease of the debtor, whether or not the contract or lease
prohibits or restricts assignment of rights or delegation of duties,
if--
``(A)(i) applicable law excuses a party to the contract or
lease from accepting performance from or rendering performance
to an assignee of the contract or lease, whether or not the
contract or lease prohibits or restricts assignment of rights
or delegation of duties; and
``(ii) the party does not consent to the assumption or
assignment; or
``(B) the contract is a contract to make a loan, or extend
other debt financing or financial accommodations, to or for the
benefit of the debtor, or to issue a security of the debtor.
``(2) Notwithstanding paragraph (1)(A) and applicable nonbankruptcy
law, in a case under chapter 11 of this title, a trustee in a case in
which a debtor is a corporation, or a debtor in possession, may assume
an executory contract or unexpired lease of the debtor, whether or not
the contract or lease prohibits or restricts assignment of rights or
delegation of duties.
``(3) The trustee may not assume or assign an unexpired lease of
the debtor of nonresidential real property, whether or not the contract
or lease prohibits or restricts assignment of rights or delegation of
duties, if the lease has been terminated under applicable nonbankruptcy
law before the order for relief.''.
(b) Section 365(d) of title 11, United States Code, is amended by
striking paragraphs (5), (6), (7), (8), and (9), and redesignating
paragraph (10) as paragraph (5).
(c) Section 365(e) of title 11, United States Code, is amended to
read as follows:
``(e)(1) Notwithstanding a provision in an executory contract or
unexpired lease, or in applicable law, an executory contract or
unexpired lease of the debtor may not be terminated or modified, and
any right or obligation under such contract or lease may not be
terminated or modified, at any time after the commencement of the case
solely because of a provision in such contract or lease that is
conditioned on--
``(A) the insolvency or financial condition of the debtor
at any time before the closing of the case;
``(B) the commencement of a case under this title; or
``(C) the appointment of or taking possession by a trustee
in a case under this title or a custodian before such
commencement.
``(2) Paragraph (1) does not apply to an executory contract or
unexpired lease of the debtor if the trustee may not assume or assign,
and the debtor in possession may not assume, the contract or lease by
reason of the provisions of subsection (c) of this section.''.
(d) Section 365(f)(1) of title 11, United States Code, is amended
by striking the semicolon and all that follows through ``event''.
TITLE IV SMALL BUSINESS BANKRUPTCY PROVISIONS
SEC. 401. FLEXIBLE RULES FOR DISCLOSURE STATEMENT AND PLAN.
(a) Section 1125(a)(1) of title 11, United States Code, is amended
by inserting before the semicolon following:
``and in determining whether a disclosure statement provides adequate
information, the court shall consider the complexity of the case, the
benefit of additional information to creditors and other parties in
interest, and the cost of providing additional information''.
(b) Section 1125(f) of title 11, United States Code, is amended to
read as follows:
``(f) Notwithstanding subsection (b)--
``(1) the court may determine that the plan itself provides
adequate information and that a separate disclosure statement
is not necessary;
``(2) the court may approve a disclosure statement
submitted on standard forms approved by the court or adopted
pursuant to section 2075 of title 28; and
``(3)(A) the court may conditionally approve a disclosure
statement subject to final approval after notice and a hearing;
``(B) acceptances and rejections of a plan may be solicited
based on a conditionally approved disclosure statement if the
debtor provides adequate information to each holder of a claim
or interest that is solicited, but a conditionally approved
disclosure statement shall be mailed not less than 20 days
before the date of the hearing on confirmation of the plan; and
``(C) the hearing on the disclosure statement may be combined with
the hearing on confirmation of a plan.''.
SEC. 402. DEFINITIONS.
(a) Definitions. Section 101 of title 11, United States Code, is
amended by striking paragraph (51C) and inserting the following:
``(51C) `small business case' means a case filed under
chapter 11 of this title in which the debtor is a small
business debtor; and
``(51D) `small business debtor' means (A) a person
(including affiliates of such person that are also debtors
under this title) that has aggregate noncontingent, liquidated
secured and unsecured debts as of the date of the petition or
the order for relief in an amount not more than $4,000,000
(excluding debts owed to 1 or more affiliates or insiders),
except that if a group of affiliated debtors has aggregate
noncontingent liquidated secured and unsecured debts greater
than $4,000,000 (excluding debt owed to 1 or more affiliates or
insiders), then no member of such group is a small business
debtor;''.
(b) Conforming Amendment.--Section 1102(a)(3) of title 11, United
States Code, is amended by inserting ``debtor'' after ``small
business'' .
SEC. 403. STANDARD FORM DISCLOSURE STATEMENT AND PLAN.
The Advisory Committee on Bankruptcy Rules of the Judicial
Conference of the United States shall, within a reasonable period of
time after the date of the enactment of this Act, propose for adoption
standard form disclosure statements and plans of reorganization for
small business debtors (as defined in section 101 of title 11, United
States Code, as amended by this Act), designed to achieve a practical
balance between--
(1) the reasonable needs of the courts, the United States
trustee, creditors, and other parties in interest for
reasonably complete information; and
(2) economy and simplicity for debtors.
SEC. 404. UNIFORM NATIONAL REPORTING REQUIREMENTS.
(a) Reporting Required.--
(1) Title 11 of the United States Code is amended by
inserting after section 307 the following:
``Sec. 308. Debtor reporting requirements
``A small business debtor shall file periodic financial and other
reports containing information including--
``(1) the debtor's profitability, that is, approximately
how much money the debtor has been earning or losing during
current and recent fiscal periods;
``(2) reasonable approximations of the debtor's projected
cash receipts and cash disbursements over a reasonable period;
``(3) comparisons of actual cash receipts and disbursements
with projections in prior reports; and
``(4) whether the debtor is--
``(A) in compliance in all material respects with
postpetition requirements imposed by this title and the
Federal Rules of Bankruptcy Procedure; and
``(B) timely filing tax returns and paying taxes
and other administrative claims when due, and, if not,
what the failures are and how, at what cost, and when
the debtor intends to remedy such failures; and
``(5) such other matters as are in the best interests of
the debtor and creditors, and in the public interest in fair
and efficient procedures under chapter 11 of this title.''.
(2) The table of sections of chapter 3 of title 11, United
States Code, is amended by inserting after the item relating to
section 307 the following:
``308. Debtor reporting requirements.''.
(b) Effective Date.--The amendments made by subsection (a) shall
take effect 60 days after the date on which rules are prescribed
pursuant to section 2075, title 28, United States Code to establish
forms to be used to comply with section 308 of title 11, United States
Code, as added by subsection (a).
SEC. 405. UNIFORM REPORTING RULES AND FORMS FOR SMALL BUSINESS CASES.
(a) Proposal of Rules and Forms.--The Advisory Committee on
Bankruptcy Rules of the Judicial Conference of the United States shall
propose for adoption amended Federal Rules of Bankruptcy Procedure and
Official Bankruptcy Forms to be used by small business debtors to file
periodic financial and other reports containing information, including
information relating to--
(1) the debtor's profitability;
(2) the debtor's cash receipts and disbursements; and
(3) whether the debtor is timely filing tax returns and
paying taxes and other administrative claims when due.
(b) Purpose.--The rules and forms proposed under subsection (a)
shall be designed to achieve a practical balance between--
(1) the reasonable needs of the bankruptcy court, the
United States trustee, creditors, and other parties in interest
for reasonably complete information;
(2) the small business debtor's interest that required
reports be easy and inexpensive to complete; and
(3) the interest of all parties that the required reports
help the small business debtor to understand its financial
condition and plan its future.
SEC. 406. DUTIES IN SMALL BUSINESS CASES.
(a) Duties in Chapter 11 Cases.--Title 11 of the United States Code
is amended by inserting after section 1114 the following:
``Sec. 1115. Duties of trustee or debtor in possession in small
business cases
``(a) In a small business case, a trustee or the debtor in
possession, in addition to the duties provided in this title and as
otherwise required by law, shall--
``(1) append to the voluntary petition or, in an
involuntary case, file within 3 days after the date of the
order for relief--
``(A) its most recent balance sheet, statement of
operations, cash-flow statement, Federal income tax
return; or
``(B) a statement made under penalty of perjury
that no balance sheet, statement of operations, or
cash-flow statement has been prepared and no Federal
tax return has been filed;
``(2) attend, through its responsible individual, meetings
scheduled by the court or the United States trustee, including
initial debtor interviews and meetings of creditors convened
under section 341 of this title;
``(3) timely file all schedules and statements of financial
affairs, unless the court, after notice and a hearing, grants
an extension, which shall not extend such time period to a date
later than 30 days after the date of the order for relief,
absent extraordinary and compelling circumstances;
``(4) file all postpetition financial and other reports
required by the Federal Rules of Bankruptcy Procedure or by
local rule of the district court;
``(5) subject to section 363(c)(2) of this title, maintain
insurance customary and appropriate to the industry;
``(6)(A) timely file tax returns;
``(B) subject to section 363(c)(2) of this title, timely
pay all administrative expense tax claims, except those being
contested by appropriate proceedings being diligently
prosecuted; and
``(C) subject to section 363(c)(2) of this title, establish
1 or more separate deposit accounts not later than 10 business
days after the date of order for relief (or as soon thereafter
as possible if all banks contacted decline the business) and
deposit therein, not later than 1 business day after receipt
thereof or a responsible time set by the court, all taxes
payable for periods beginning after the date the case is
commenced that are collected or withheld by the debtor for
governmental units unless the court waives this requirement
after notice and hearing; and
``(7) allow the United States trustee, or its designated
representative, to inspect the debtor's business premises,
books, and records at reasonable times, after reasonable prior
written notice, unless notice is waived by the debtor.''.
(b) Technical Amendment.--The table of sections of chapter 11,
United States Code, is amended by inserting after the item relating to
section 1114 the following:
``1115. Duties of trustee or debtor in possession in small business
cases.''.
SEC. 407. PLAN FILING AND CONFIRMATION DEADLINES.
Section 1121(e) of title 11, United States Code, is amended to read
as follows:
``(e) In a small business case--
``(1) only the debtor may file a plan until after 90 days
after the date of the order for relief, unless a trustee has
been appointed under this chapter, or unless the court, on
request of a party in interest and after notice and hearing,
shortens such time;
``(2) the debtor shall file a plan, and any necessary
disclosure statement, not later than 90 days after the date of
the order for relief, unless the United States Trustee has
appointed under section 1102(a)(1) of this title a committee of
unsecured creditors that the court has determined, before the
90 days has expired, is sufficiently active and representative
to provide effective oversight of the debtor; and
``(3) the time periods specified in paragraphs (1) and (2)
of this subsection and the time fixed in section 1129(e) of
this title for confirmation of a plan, may be extended only as
follows:
``(A) On request of a party in interest made within
the respective periods, and after notice and hearing,
the court may for cause grant one or more extensions,
cumulatively not to exceed 60 days, if the movant
establishes--
``(i) that no cause exists to dismiss or
convert the case or appoint a trustee or
examiner under subparagraphs (A) (I) of section
1112(b) of this title; and
``(ii) that there is a reasonable
possibility the court will confirm a plan
within a reasonable time;
``(B) On request of a party in interest made within
the respective periods, and after notice and hearing,
the court may for cause grant one or more extensions in
excess of those authorized under subparagraph (A) of
this paragraph, if the movant establishes:
``(i) that no cause exists to dismiss or
convert the case or appoint a trustee or
examiner under subparagraphs (A) (I) of section
1112(b)(3) of this title; and
``(ii) that it is more likely than not that
the court will confirm a plan within a
reasonable time; and
``(C) a new deadline shall be imposed whenever an
extension is granted.''.
SEC. 408. PLAN CONFIRMATION DEADLINE.
Section 1129 of title 11, United States Code, is amended by adding
at the end the following:
``(e) In a small business case, the debtor shall confirm a plan not
later than 150 days after the date of the order for relief unless--
``(1) the United States Trustee has appointed, under
section 1102(a)(1) of this title, a committee of unsecured
creditors that the court has determined, before the 150 days
has expired, is sufficiently active and representative to
provide effective oversight of the debtor; or
``(2) such 150-day period is extended as provided in
section 1121(e)(3) of this title.''.
SEC. 409. PROHIBITION AGAINST EXTENSION OF TIME.
Section 105(d) of title 11, United States Code, is amended--
(1) in paragraph (2)(B)(vi) by striking the period at the
end and inserting ``; and''; and
(2) by adding at the end the following:
``(3) in a small business case, not extend the time periods
specified in sections 1121(e) and 1129(e) of this title except
as provided in section 1121(e)(3) of this title.''.
SEC. 410. DUTIES OF THE UNITED STATES TRUSTEE.
(a) Duties of the United States Trustee.--
Section 586(a) of title 28, United States Code, is amended--
(1) in paragraph (3)--
(A) in subparagraph (G) by striking ``and at the
end'';
(B) by redesignating subparagraph (H) as
subparagraph (I); and
(C) by inserting after subparagraph (G) the
following:
``(H) in small business cases (as defined in
section 101 of title 11), performing the additional
duties specified in title 11 pertaining to such
cases'';
(2) in paragraph (5) by striking ``and at the end'';
(3) in paragraph (6) by striking the period at the end and
inserting ``; and''; and
(4) by inserting after paragraph (7) the following:
``(7) in each of such small business cases--
``(A) conduct an initial debtor interview as soon
as practicable after the entry of order for relief but
before the first meeting scheduled under section 341(a)
of title 11 at which time the United States trustee
shall begin to investigate the debtor's viability,
inquire about the debtor's business plan, explain the
debtor's obligations to file monthly operating reports
and other required reports, attempt to develop an
agreed scheduling order, and inform the debtor of other
obligations;
``(B) when determined to be appropriate and
advisable, visit the appropriate business premises of
the debtor and ascertain the state of the debtor's
books and records and verify that the debtor has filed
its tax returns; and
``(C) review and monitor diligently the debtor's
activities, to identify as promptly as possible whether
the debtor will be unable to confirm a plan; and
``(8) in cases in which the United States trustee finds
material grounds for any relief under section 1112 of title 11,
the United States trustee shall apply promptly to the court for
relief.''.
SEC. 411. SCHEDULING CONFERENCES.
Section 105(d) of title 11, United States Code, is amended--
(1) in the matter preceding paragraph (1) by striking ``,
may'';
(2) by amending paragraph (1) to read as follows:
``(1) shall hold such status conferences as are necessary
to further the expeditious and economical resolution of the
case; and''; and
(3) in paragraph (2) by striking ``unless inconsistent with
another provision of this title or with applicable Federal
Rules of Bankruptcy Procedure'', and inserting ``may''.
SEC. 412. SERIAL FILER PROVISIONS.
Section 362 of title 11, United States Code, as amended by section
302, is amended--
(1) in subsection (i) as so redesignated by section 122--
(A) by striking ``An'' and inserting ``(1) Except
as provided in paragraph (2), an''; and
(B) by adding at the end the following:
``(2) If such violation is based on an action taken by an entity in
the good-faith belief that subsection (h) applies to the debtor, then
recovery under paragraph (1) against such entity shall be limited to
actual damages.''; and
(2) by inserting after subsection (j), as added by section
302, the following:
``(k)(1) Except as provided in paragraph (2) of this subsection,
the provisions of subsection (a) of thissection shall not apply in a
case in which the debtor--
``(A) is a debtor in a case under this title pending at the
time the petition is filed;
``(B) was a debtor in a case under this title which was
dismissed for any reason by an order that became final in the
2-year period ending on the date of the order for relief
entered with respect to the petition;
``(C) was a debtor in a case under this title in which a
chapter 11, 12, or 13 plan was confirmed in the 2-year period
ending on the date of the order for relief entered with respect
to the petition; or
``(D) is an entity that has succeeded to substantially all
of the assets or business of a debtor described in subparagraph
(A), (B), or (C).
``(2) This subsection shall not apply--
``(A) to a case initiated by an involuntary petition filed
by a creditor that is not an insider or affiliate of the
debtor; or
``(B) after such time as the debtor, after notice and a
hearing, demonstrates by a preponderance of the evidence, that
the filing of such petition resulted from circumstances beyond
the control of the debtor and not foreseeable at the time the
earlier case was filed; and that it is more likely than not
that the court will confirm a plan, other than a liquidating
plan, within a reasonable time.''.
SEC. 413. EXPANDED GROUNDS FOR DISMISSAL OR CONVERSION AND APPOINTMENT
OF TRUSTEE OR EXAMINER.
(a) Expanded Grounds for Dismissal or Conversion.--Section 1112(b)
of title 11, United States Code, is amended to read as follows:
``(b)(1) Except as provided in paragraphs (2) and (4) of this
subsection, and in subsection (c) of this section, on request of a
party in interest, and after notice and a hearing, the court shall
convert a case under this chapter to a case under chapter 7 of this
title or dismiss a case under this chapter, or appoint a trustee or
examiner under section 1104(e) of this title, whichever is in the best
interest of creditors and the estate, if the movant establishes cause.
``(2) The court may decline to grant the relief specified in
paragraph (1) of this subsection if the debtor or another party in
interest objects and establishes by a preponderance of the evidence
that--
``(A) it is more likely than not that a plan will be
confirmed within a time as fixed by this title or by order of
the court entered pursuant to section 1121(e)(3), or within a
reasonable time if no time has been fixed; and
``(B) if the cause is an act or omission of the debtor
that--
``(i) there exists a reasonable justification for
the act or omission; and
``(ii) the act or omission will be cured within a
reasonable time fixed by the court not to exceed 30
days after the court decides the motion, unless the
movant expressly consents to a continuance for a
specific period of time, or compelling circumstances
beyond the control of the debtor justify an extension.
``(3) For purposes of this subsection, cause includes--
``(A) substantial or continuing loss to or diminution of
the estate;
``(B) gross mismanagement of the estate;
``(C) failure to maintain insurance that poses a material
risk to the estate or the public;
``(D) unauthorized use of cash collateral harmful to 1 or
more creditors;
``(E) failure to comply with an order of the court;
``(F) failure timely to satisfy any filing or reporting
requirement established by this title or by any rule applicable
to a case under this chapter;
``(G) failure to attend the meeting of creditors convened
under section 341(a) of this title;
``(H) failure timely to provide information or attend
meetings reasonably requested by the United States trustee or
bankruptcy administrator;
``(I) failure timely to pay taxes due after the date of the
order for relief or to file tax returns due after the order for
relief;
``(J) failure to file a disclosure statement, or to file or
confirm a plan, within the time fixed by this title or by order
of the court;
``(K) failure to pay any fees or charges required under
chapter 123 of title 28;
``(L) revocation of an order of confirmation under section
1144 of this title;
``(M) inability to effectuate substantial consummation of a
confirmed plan;
``(N) material default by the debtor with respect to a
confirmed plan; and
``(O) termination of a plan by reason of the occurrence of
a condition specified in the plan.
``(4) The court may grant relief under this subsection for cause as
defined in subparagraphs C, F, G, H, or K of paragraph 3 of this
subsection only upon motion of the United States trustee or bankruptcy
administrator or upon the court s own motion.
``(5) The court shall commence the hearing on any motion under this
subsection not later than 30 days after filing of the motion, and shall
decide the motion within 15 days after commencement of the hearing,
unless the movant expressly consents to a continuance for a specific
period of time or compelling circumstances prevent the court from
meeting the time limits established by this paragraph.''.
(b) Additional Grounds for Appointment of Trustee or Examiner.--
Section 1104 of title 11, United States Code, is amended by adding at
the end the following:
``(e) If grounds exist to convert or dismiss the case under section
1112 of this title, the court may instead appoint a trustee or
examiner, if it determines that such appointment is in the best
interests of creditors and the estate.''.
SEC. 414. STUDY OF OPERATION OF TITLE 11 OF THE UNITED STATES CODE WITH
RESPECT TO SMALL BUSINESSES.
Not later than 2 years after the date of the enactment of this Act,
the Administrator of the Small Business Administration, in consultation
with the Attorney General, the Director of the Administrative Office of
United States Trustees, and the Director of the Administrative Office
of the United States Courts, shall--
(1) conduct a study to determine--
(A) the internal and external factors that cause
small businesses, especially sole proprietorships, to
become debtors in cases under title 11 of the United
States Code and that cause certain small businesses to
successfully complete cases under chapter 11 of such
title; and
(B) how Federal laws relating to bankruptcy may be
made more effective and efficient in assisting small
businesses to remain viable; and
(2) submit to the President pro tempore of the Senate and
the Speaker of the House of Representatives a report
summarizing that study.
SEC. 415. PAYMENT OF INTEREST.
Section 362(d)(3) of title 11, United States Code, is amended--
(1) by inserting ``or 30 days after the court determines
that the debtor is subject to this paragraph, whichever is
later'' after ``90-day period)''; and
(2) by amending subparagraph (B) to read as follows:
``(B) the debtor has commenced monthly payments
(which payments may, in the debtor's sole discretion,
notwithstanding section 363(c)(2) of this title, be
made from rents or other income generated before or
after the commencement of the case by or from the
property) to each creditor whose claim is secured by
such real estate (other than a claim secured by a
judgment lien or by an unmatured statutory lien), which
payments are in an amount equal to interest at the
then-applicable nondefault contract rate of interest on
the value of the creditor's interest in the real
estate; or''.
TITLE V--MUNICIPAL BANKRUPTCY PROVISIONS
SEC. 501. PETITION AND PROCEEDINGS RELATED TO PETITION.
(a) Technical Amendment Relating to Municipalities.--Section 921(d)
of title 11, United States Code, is amended by inserting
``notwithstanding section 301(b)'' before the period at the end.
(b) Conforming Amendment.--Section 301 of title 11, United States
Code, is amended--
(1) by inserting ``(a)'' before ``A voluntary''; and
(2) by amending the last sentence to read as follows:
``(b) The commencement of a voluntary case under a chapter of this
title constitutes an order for relief under such chapter.''.
SEC. 502. APPLICABILITY OF OTHER SECTIONS TO CHAPTER 9.
Section 901(a) of title 11, United States Code, is amended--
(1) by inserting ``555, 556,'' after ``553,''; and
(2) by inserting ``559, 560, 561, 562'' after ``557,''.
TITLE VI--STREAMLINING THE BANKRUPTCY SYSTEM
SEC. 601. CREDITOR REPRESENTATION AT FIRST MEETING OF CREDITORS.
Section 341(c) of title 11, United States Code, is amended by
inserting after the first sentence the following: ``Notwithstanding any
local court rule, provision of a State constitution, any other Federal
or State law that is not a bankruptcy law, or other requirement that
representation at the meeting of creditors under subsection (a) be by
an attorney, a creditor holding a consumer debt or any representative
of the creditor (which may include an entity or an employee of an
entity and may be a representative for more than one creditor) shall be
permitted to appear at and participate in the meeting of creditors and
activities related thereto in a case under chapter 7 or 13, either
alone or in conjunction with an attorney for the creditor. Nothing in
this subsection shall be construed to require any creditor to be
represented by an attorney at any meeting of creditors.''.
SEC. 602. AUDIT PROCEDURES.
(a) Amendments.--Section 586 of title 28, United States Code, is
amended--
(1) in subsection (a) by amending striking paragraph (6) to
read as follows:
``(6) make such reports as the Attorney General directs,
including the results of audits performed under subsection (f);
and''; and
(2) by adding at the end the following:
``(f)(1)(A) The Attorney General shall establish procedures to
determine the accuracy, veracity, and completeness of petitions,
schedules, and other information which the debtor is required to
provide under sections 521 and 1322 of title 11, and, if applicable,
section 111 of title 11, in individual cases filed under chapter 7 or
13 of such title. Such audits shall be in accordance with generally
accepted auditing standards and performed by independent certified
public accountants or independent licensed public accountants.
``(B) Those procedures shall--
``(i) establish a method of selecting appropriate qualified
persons to contract to perform those audits;
``(ii) establish a method of randomly selecting cases to be
audited, except that not less than 1 out of every 250 cases in
each Federal judicial district shall be selected for audit;
``(iii) require audits for schedules of income and expenses
which reflect greater than average variances from the
statistical norm of the district in which the schedules were
filed; and
``(iv) establish procedures for providing, not less
frequently than annually, public information concerning the
aggregate results of such audits including the percentage of
cases, by district, in which a material misstatement of income
or expenditures is reported.
``(2) The United States trustee for each district is authorized to
contract with auditors to perform audits in cases designated by the
United States trustee according to the procedures established under
paragraph (1).
``(3)(A) The report of each audit conducted under this subsection
shall be filed with the court and transmitted to the United States
trustee. Each report shall clearly and conspicuously specify any
material misstatement of income or expenditures or of assets identified
by the person performing the audit. In any case where a material
misstatement of income or expenditures or of assets has been reported,
the clerk of the bankruptcy court shall give notice of the misstatement
to the creditors in the case.
``(B) If a material misstatement of income or expenditures or of
assets is reported, the United States trustee shall--
``(i) report the material misstatement, if appropriate, to
the United States Attorney pursuant to section 3057 of title
18, United States Code; and
``(ii) if advisable, take appropriate action, including but
not limited to commencing an adversary proceeding to revoke the
debtor's discharge pursuant to section 727(d) of title 11,
United States Code.''.
(b) Amendments to Section 521 of Title 11, U.S.C.--Section 521(a)
of title 11, United States Code, as amended by section 603, is amended
in paragraphs (3) and (4) by adding ``or an auditor appointed pursuant
to section 586 of title 28, United States Code'' after ``serving in the
case''.
(c) Amendments to Section 727 of Title 11, U.S.C.--Section 727(d)
of title 11, United States Code, is amended--
(1) by deleting ``or'' at the end of paragraph (2);
(2) by substituting ``; or'' for the period at the end of
paragraph (3); and
(3) by adding the following at the end the following:
``(4) the debtor has failed to explain satisfactorily--
``(A) a material misstatement in an audit performed
pursuant to section 586(f) of title 28, United States
Code; or
``(B) a failure to make available for inspection
all necessary accounts, papers, documents, financial
records, files, and all other papers, things, or property belonging to
the debtor that are requested for an audit conducted pursuant to
section 586(f) of title 28, United States Code.''.
(d) Effective Date.--The amendments made by this section shall take
effect 18 months after the date of enactment of this Act.
SEC. 603. GIVING CREDITORS FAIR NOTICE IN CHAPTER 7 AND 13 CASES.
(a) Notice.--Section 342 of title 11, United States Code, is
amended--
(1) in subsection (c)--
(A) by striking ``, but the failure of such notice
to contain such information shall not invalidate the
legal effect of such notice''; and
(B) by adding the following at the end:
``If the credit agreement between the debtor and the creditor or the
last communication before the filing of the petition in a voluntary
case from the creditor to a debtor who is an individual states an
account number of the debtor which is the current account number of the
debtor with respect to any debt held by the creditor against the
debtor, the debtor shall include such account number in any notice to
the creditor required to be given under this title. If the creditor has
specified to the debtor an address at which the creditor wishes to
receive correspondence regarding the debtor's account, any notice to
the creditor required to be given by the debtor under this title shall
be given at such address. For the purposes of this section, `notice'
shall include, but shall not be limited to, any correspondence from the
debtor to the creditor after the commencement of the case, any
statement of the debtor's intention under section 521(a)(2) of this
title, notice of the commencement of any proceeding in the case to
which the creditor is a party, and any notice of the hearing under
section 1324 of this title.'';
(2) by adding at the end the following:
``(d) At any time, a creditor in a case of an individual debtor
under chapter 7 or 13 may file with the court and serve on the debtor a
notice of the address to be used to notify the creditor in that case.
After 5 days following receipt of such notice, any notice the court or
the debtor is required to give the creditor shall be given at that
address.
``(e) An entity may file with the court a notice stating its
address for notice in cases under chapters 7 and 13. After 30 days
following the filing of such notice, any notice in any case filed under
chapter 7 or 13 given by the court shall be to that address unless
specific notice is given under subsection (d) with respect to a
particular case.
``(f) Notice given to a creditor other than as provided in this
section shall not be effective notice until it has been brought to the
attention of the creditor. If the creditor has designated a person or
department to be responsible for receiving notices concerning
bankruptcy cases and has established reasonable procedures so that
bankruptcy notices received by the creditor will be delivered to such
department or person, notice will not be brought to the attention of
the creditor until received by such person or department. No sanction
under section 362(h) of this title or any other sanction which a court
may impose on account of violations of the stay under section 362(a) of
this title or failure to comply with section 542 or 543 of this title
may be imposed on any action of the creditor unless the action takes
place after the creditor has received notice of the commencement of the
case effective under this section.''.
(b) Debtor's Duties.--Section 521 of title 11, United States Code,
as amended by sections 604, 120, and 302, is amended--
(1) by inserting ``(a)'' before ``The debtor shall--'';
(2) by striking paragraph (1) and inserting the following:
``(1) file--
``(A) a list of creditors; and
``(B) unless the court orders otherwise--
``(i) a schedule of assets and liabilities;
``(ii) a schedule of current monthly income
and current expenditures prepared in accordance
with section 707(b)(2);
``(iii) a statement of the debtor's
financial affairs and, if applicable, a
certificate--
``(I) of an attorney whose name is
on the petition as the attorney for the
debtor or any bankruptcy petition
preparer signing the petition pursuant
to section 110(b)(1) of this title
indicating that such attorney or
bankruptcy petition preparer delivered
to the debtor any notice required by
section 342(b) of this title; or
``(II) if no attorney for the
debtor is indicated and no bankruptcy
petition preparer signed the petition,
of the debtor that such notice was
obtained and read by the debtor;
``(iv) copies of any Federal tax returns,
including any schedules or attachments, filed
by the debtor for the 3-year period preceding
the order for relief;
``(v) copies of all payment advices or
other evidence of payment, if any, received by
the debtor from any employer of the debtor in
the period 60 days prior to the filing of the
petition; and
``(vi) a statement disclosing any
reasonably anticipated increase in income or
expenditures over the 12-month period following
the date of filing;'';
(3) by adding at the end the following:
``(e)(1) At any time, a creditor, in the case of an individual
under chapter 7 or 13, may file with the court notice that the creditor
requests the petition, schedules, and a statement of affairs filed by
the debtor in the case and the court shall make those documents
available to the creditor who requests those documents at a reasonable
cost within 5 business days after such request.
``(2) At any time, a creditor in a case under chapter 13 may file
with the court notice that the creditor requests the plan filed by the
debtor in the case, and the court shall make such plan available to the
creditor who requests such plan at a reasonable cost and not later than
5 days after such request.
``(f) An individual debtor in a case under chapter 7 or 13 shall
file with the court--
``(1) at the time filed with the taxing authority, all tax
returns, including any schedules or attachments, with respect
to the period from the commencement of the case until such time
as the case is closed;
``(2) at the time filed with the taxing authority, all tax
returns, including any schedules or attachments, that were not
filed with the taxing authority when the schedules under
subsection (a)(1) were filed with respect to the period that is
3 years before the order for relief;
``(3) any amendments to any of the tax returns, including
schedules or attachments, described in paragraph (1) or (2);
and
``(4) in a case under chapter 13, a statement subject to
the penalties of perjury by the debtor of the debtor's current
monthly income and expenditures in the preceding tax year and
current monthly income less expenditures for the month
preceding the statement prepared in accordance with section
707(b)(2) that shows how the amounts are calculated--
``(A) beginning on the date that is the later of 90
days after the close of the debtor's tax year or 1 year
after the order for relief, unless a plan has been
confirmed; and
``(B) thereafter, on or before the date that is 45
days before each anniversary of the confirmation of the
plan until the case is closed.
``(g)(1) A statement referred to in subsection (f)(4) shall
disclose--
``(A) the amount and sources of income of the debtor;
``(B) the identity of any persons responsible with the
debtor for the support of any dependents of the debtor; and
``(C) the identity of any persons who contributed, and the
amount contributed, to the household in which the debtor
resides.
``(2) The tax returns, amendments, and statement of income and
expenditures described in paragraph (1) shall be available to the
United States trustee, any bankruptcy administrator, any trustee, and
any party in interest for inspection and copying, subject to the
requirements of subsection (h).
``(h)(1) Not later than 30 days after the date of enactment of the
Consumer Bankruptcy Reform Act of 1999, the Director of the
Administrative Office of the United States Courts shall establish
procedures for safeguarding the confidentiality of any tax information
required to be provided under this section.
``(2) The procedures under paragraph (1) shall include reasonable
restrictions on creditor access to tax information that is required to
be provided under this section to verify creditor identity and to
restrict use of the information except with respect to the case.
``(3) Not later than 1 year after the date of enactment of the
Consumer Bankruptcy Reform Act of 1999, the Director of the
Administrative Office of the United States Courts shall prepare, and
submit to Congress a report that--
``(A) assesses the effectiveness of the procedures under
paragraph (1) to provide timely and sufficient information to
creditors concerning the case; and
``(B) if appropriate, includes proposed legislation--
``(i) to further protect the confidentiality of tax
information or to make it better available to
creditors; and
``(ii) to provide penalties for the improper use by
any person of the tax information required to be
provided under this section.
``(i) If requested by the United States trustee or a trustee
serving in the case, the debtor provide a document that establishes the
identity of the debtor, including a driver's license, passport, or
other document that contains a photograph of the debtor and such other
personal identifying information relating to the debtor that
establishes the identity of the debtor.''.
(c) Section 1324 of title 11, United States Code, is amended--
(1) by inserting ``(a)'' before ``After''; and
(2) by inserting at the end thereof--
``(c) Whenever a party in interest is given notice of a hearing on
the confirmation or modification of a plan under this chapter, such
notice shall include the information provided by the debtor on the most
recent statement filed with the court pursuant to section
521(a)(1)(B)(ii) or (f)(4) of this title.''.
SEC. 604. DISMISSAL FOR FAILURE TO TIMELY FILE SCHEDULES OR PROVIDE
REQUIRED INFORMATION.
Section 521 of title 11, United States Code, as amended by section
603 is amended by inserting after subsection (a) the following:
``(b)(1) Notwithstanding section 707(a) of this title, and subject
to paragraph (2), if an individual debtor in a voluntary case under
chapter 7 or 13 fails to file all of the information required under
subsection (a)(1) within 45 days after the filing of the petition
commencing the case, the case shall be automatically dismissed
effective on the 46th day after the filing of the petition.
``(2) With respect to a case described in paragraph (1), any party
in interest may request the court to enter an order dismissing the
case. The court shall, if so requested, enter an order of dismissal not
later than 5 days after such request.
``(3) Upon request of the debtor made within 45 days after the
filing of the petition commencing a case described in paragraph (1),
the court may allow the debtor an additional period not to exceed 45
days to file the information required under subsection (a)(1) if the
court finds justification for extending the period for the filing.''.
SEC. 605. ADEQUATE TIME TO PREPARE FOR HEARING ON CONFIRMATION OF THE
PLAN.
(a) Hearing.--Section 1324 of title 11, United States Code, is
amended--
(1) by striking ``After'' and inserting the following:
``(a) Except as provided in subsection (b) and after''; and
(2) by adding at the end the following:
``(b) The hearing on confirmation of the plan may be held not
earlier than 20 days, and not later than 45 days, after the meeting of
creditors under section 341(a) of this title.''.
SEC. 606. CHAPTER 13 PLANS TO HAVE A 5-YEAR DURATION IN CERTAIN CASES.
Title 11, United States Code, is amended--
(1) by amending section 1322(d) to read as follows:
``(d) If the current monthly income of the debtor and the debtor's
spouse combined, when multiplied by 12, is not less than the highest
national median family income last reported by the Bureau of the Census
for a family of equal or lesser size or, in the case of a household of
1 person, not less than the national median household income for 1
earner, the plan may not provide for payments over a period that is
longer than 5 years. If the current monthly income of the debtor and
the debtor's spouse combined, when multiplied by 12, is less than the
highest national median family income for a family of equal or lesser
size, or in the case of a household of 1 person, the national median
household income for 1 earner, the plan may not provide for payments
over a period that is longer than 3 years, unless the court, for cause,
approves a longer period, but the court may not approve a period that
is longer than 5 years. Notwithstanding the foregoing, the national
median family income for a family of more than 4 individuals shall be
the national median family income last reported by the Bureau of the
Census for a family of 4 individuals plus $583 for each additional
member of the family.'';
(2) in section 1325(b)(1)(B) as amended by section 130--
(A) by striking ``three year period'' and inserting
``applicable commitment period''; and
(B) by inserting at the end of subparagraph (B) the
following: ``The `applicable commitment period' shall
be not less than 5 years if the current monthly income
of the debtor and the debtor's spouse combined, when
multiplied by 12, is not less than the highest national
median family income last reported by the Bureau of the
Census for a family of equal or lesser size, or in the
case of a household of 1 person, the national median
household income for 1 earner. Notwithstanding the
foregoing, the national median family income for a
family of more than 4 individuals shall be the national
median family income last reported by the Bureau of the
Census for a family of 4 individuals plus $583 for each
additional member of the family.''; and
(3) in section 1329--
(A) by striking in subsection (c) ``three years''
and inserting ``the applicable commitment period under
section 1325(b)(1)(B)''; and
(B) by inserting at the end of subsection (c) the
following:
``The duration period shall be 5 years if the current monthly income of
the debtor and the debtor's spouse combined, when multiplied by 12, is
not less than the highest national median family income last reported
by the Bureau of the Census for a family of equal or lesser size or, in
the case of a household of 1 person, the national median household
income for 1 earner, as of the date of the modification and shall be 3
years if the current monthly total income of the debtor and the
debtor's spouse combined, when multiplied by 12, is less than the
highest national median family income last reported by the Bureau of
the Census for a family of equal or lesser size or, in the case of a
household of 1 person, less than the national median household income
for 1 earner as of the date of the modification. Notwithstanding the
foregoing, the national median family income for a family of more than
4 individuals shall be the national median family income last reported
by the Bureau of the Census for a family of 4 individuals plus $583 for
each additional member of the family.''.
SEC. 607. SENSE OF THE CONGRESS REGARDING EXPANSION OF RULE 9011 OF THE
FEDERAL RULES OF BANKRUPTCY PROCEDURE.
It is the sense of the Congress that rule 9011 of the Federal Rules
of Bankruptcy Procedure (11 U.S.C. App) should be modified to include a
requirement that all documents (including schedules), signed and
unsigned, submitted to the court or to a trustee by debtors who
represent themselves and debtors who are represented by an attorney be
submitted only after the debtor or the debtor's attorney has made
reasonable inquiry to verify that the information contained in such
documents is well grounded in fact, and is warranted by existing law or
a good-faith argument for the extension, modification, or reversal of
existing law.
SEC. 608. ELIMINATION OF CERTAIN FEES PAYABLE IN CHAPTER 11 BANKRUPTCY
CASES.
(a) Amendments.--Section 1930(a)(6) of title 28, United States
Code, is amended--
(1) in the 1st sentence by striking ``until the case is
converted or dismissed, whichever occurs first''; and
(2) in the 2d sentence--
(A) by striking ``The'' and inserting ``Until the
plan is confirmed or the case is converted (whichever
occurs first) the''; and
(B) by striking ``less than $300,000;'' and
inserting ``less than $300,000. Until the case is
converted, dismissed, or closed (whichever occurs first
and without regard to confirmation of the plan) the fee
shall be''.
(b) Delayed Effective Date.--The amendments made by subsection (a)
shall take effect on October 1, 1999.
SEC. 609. STUDY OF BANKRUPTCY IMPACT OF CREDIT EXTENDED TO DEPENDENT
STUDENTS.
Not later than 1 year after the date of the enactment of this Act,
the Comptroller General of the United States shall--
(1) conduct a study regarding the impact that the extension
of credit to individuals who are--
(A) claimed as dependents for purposes of the
Internal Revenue Code of 1986; and
(B) enrolled in post-secondary educational
institutions,
has on the rate of cases filed under title 11 of the United
States Code; and
(2) submit to the Speaker of the House of Representatives
and the President pro tempore of the Senate a report
summarizing such study.
SEC. 610. PROMPT RELIEF FROM STAY IN INDIVIDUAL CASES.
Section 362(e) of title 11, United States Code, is amended--
(1) by inserting ``(1)'' after ``(e)''; and
(2) by adding at the end the following:
``(2) Notwithstanding paragraph (1), in the case of an individual
filing under chapter 7, 11, or 13, the stay under subsection (a) shall
terminate on the date that is 60 days after a request is made by a
party in interest under subsection (d), unless--
``(A) a final decision is rendered by the court during the
60-day period beginning on the date of the request; or
``(B) that 60-day period is extended--
``(i) by agreement of all parties in interest; or
``(ii) by the court for such specific period of
time as the court finds is required by for good cause
as described in findings made by the court.''.
SEC. 611. STOPPING ABUSIVE CONVERSIONS FROM CHAPTER 13.
Section 348(f)(1) of title 11, United States Code, is amended--
(1) in subparagraph (A), by striking ``and'' at the end;
(2) in subparagraph (B)--
(A) by striking ``in the converted case, with
allowed secured claims'' and inserting ``only in a case
converted to chapter 11 or 12 but not in a case
converted to chapter 7, with allowed secured claims in
cases under chapters 11 and 12''; and
(B) by striking the period and inserting ``; and'';
and
(3) by adding at the end the following:
``(C) with respect to cases converted from chapter 13--
``(i) the claim of any creditor holding security as
of the date of the petition shall continue to be
secured by that security unless the full amount of such
claim determined under applicable nonbankruptcy law has
been paid in full as of the date of conversion,
notwithstanding any valuation or determination of the
amount of an allowed secured claim made for the
purposes of the chapter 13 proceeding; and
``(ii) unless a prebankruptcy default has been
fully cured pursuant to the plan at the time of
conversion, in any proceeding under this title or
otherwise, the default shall have the effect given
under applicable nonbankruptcy law.''.
SEC. 612. BANKRUPTCY APPEALS.
Title 28 of the United States Code is amended by inserting after
section 1292 the following:
``Sec. 1293. Bankruptcy appeals
``(a) The courts of appeals (other than the United States Court of
Appeals for the Federal Circuit) shall have jurisdiction of appeals
from the following:
``(1) Final orders and judgments entered by bankruptcy
courts and district courts in cases under title 11, in
proceedings arising under title 11, and in proceedings arising
in or related to a case under title 11, including final orders
in proceedings regarding the automatic stay of section 362 of
title 11.
``(2) Interlocutory orders entered by bankruptcy courts and
district courts granting, continuing, modifying, refusing or
dissolving injunctions, or refusing to dissolve or modify
injunctions in cases under title 11, in proceedings arising
under title 11, and in proceedings arising in or related to a
case under title 11, other than interlocutory orders in
proceedings regarding the automatic stay of section 362 of
title 11.
``(3) Interlocutory orders of bankruptcy courts and
district courts entered under section 1104(a) or 1121(d) of
title 11, or the refusal to enter an order under such section.
``(4) An interlocutory order of a bankruptcy court or
district court entered in a case under title 11, in a
proceeding arising under title 11, or in a proceeding arising
in or related to a case under title 11, if the court of appeals
that would have jurisdiction of an appeal of a final order
entered in such case or such proceeding permits, in its
discretion, appeal to be taken from such interlocutory order.
``(b) Final decisions, judgments, orders, and decrees entered by a
bankruptcy appellate panel under subsection (b) of this section.
``(c)(1) The judicial council of a circuit may establish a
bankruptcy appellate panel composed of bankruptcy judges in the circuit
who are appointed by the judicial council, which panel shall exercise
the jurisdiction to review orders and judgments of bankruptcy courts
described in paragraphs (1)-(4) of subsection (a) of this section
unless--
``(A) the appellant elects at the time of filing the
appeal; or
``(B) any other party elects, not later than 10 days after
service of the notice of the appeal;
to have such jurisdiction exercised by the court of appeals.
``(2) An appeal to be heard by a bankruptcy appellate panel under
this subsection (b) shall be heard by 3 members of the bankruptcy
appellate panel, provided that a member of such panel may not hear an
appeal originating in the district for which such member is appointed
or designated under section 152 of this title.
``(3) If authorized by the Judicial Conference of the United
States, the judicial councils of 2 or more circuits may establish a
joint bankruptcy appellate panel.''.
SEC. 613. GAO STUDY.
(a) Study.--Not later than 270 days after the date of the enactment
of this Act, the Comptroller General of the United States shall conduct
a study of the feasibility, effectiveness, and cost of requiring
trustees appointed under title 11 of the United States Code, or the
bankruptcy courts, to provide to the Office of Child Support
Enforcement promptly after the commencement of cases by individual
debtors under such title, the names and social security numbers of such
debtors for the purposes of allowing such Office to determine whether
such debtors have outstanding obligations for child support (as
determined on the basis of information in the Federal Case Registry or
other national database).
(b) Report.--Not later than 300 days after the date of the
enactment of this Act, the Comptroller General shall submit to the
Speaker of the House of Representatives and the President pro tempore
of the Senate, a report containing the results of the study required by
subsection (a).
TITLE VII--BANKRUPTCY DATA
SEC. 701. IMPROVED BANKRUPTCY STATISTICS.
(a) Amendment.--Chapter 6 of part I of title 28, United States
Code, is amended by adding at the end the following:
``Sec. 159. Bankruptcy statistics
``(a) The clerk of each district shall compile statistics regarding
individual debtors with primarily consumer debts seeking relief under
chapters 7, 11, and 13 of title 11. Those statistics shall be in a form
prescribed by the Director of the Administrative Office of the United
States Courts (referred to in this section as the `Office').
``(b) The Director shall--
``(1) compile the statistics referred to in subsection (a);
``(2) make the statistics available to the public; and
``(3) not later than October 31, 2000, and annually
thereafter, prepare, and submit to Congress a report concerning
the information collected under subsection (a) that contains an
analysis of the information.
``(c) The compilation required under subsection (b) shall--
``(1) be itemized, by chapter, with respect to title 11;
``(2) be presented in the aggregate and for each district;
and
``(3) include information concerning--
``(A) the total assets and total liabilities of the
debtors described in subsection (a), and in each
category of assets and liabilities, as reported in the
schedules prescribed pursuant to section 2075 of this
title and filed by those debtors;
``(B) the current monthly income, and average
income and average expenses of those debtors as
reported on the schedules and statements that each such
debtor files under sections 521 and 1322 of title 11;
``(C) the aggregate amount of debt discharged in
the reporting period, determined as the difference
between the total amount of debt and obligations of a
debtor reported on the schedules and the amount of such
debt reported in categories which are predominantly
nondischargeable;
``(D) the average period of time between the filing
of the petition and the closing of the case;
``(E) for the reporting period--
``(i) the number of cases in which a
reaffirmation was filed; and
``(ii)(I) the total number of
reaffirmations filed;
``(II) of those cases in which a
reaffirmation was filed, the number in which
the debtor was not represented by an attorney;
and
``(III) of those cases, the number of cases
in which the reaffirmation was approved by the
court;
``(F) with respect to cases filed under chapter 13
of title 11, for the reporting period--
``(i)(I) the number of cases in which a
final order was entered determining the value
of property securing a claim in an amount less
than the amount of the claim; and
``(II) the number of final orders
determining the value of property securing a
claim issued;
``(ii) the number of cases dismissed, the
number of cases dismissed for failure to make
payments under the plan, the number of cases
refiled after dismissal, and the number of
cases in which the plan was completed,
separately itemized with respect to the number
of modifications made before completion of the
plan, if any; and
``(iii) the number of cases in which the
debtor filed another case within the 6 years
previous to the filing;
``(G) the number of cases in which creditors were
fined for misconduct and any amount of punitive damages
awarded by the court for creditor misconduct; and
``(H) the number of cases in which sanctions under
rule 9011 of the Federal Rules of Bankruptcy Procedure
were imposed against debtor's counsel and damages
awarded under such Rule.''.
(b) Clerical Amendment.--The table of sections at the beginning of
chapter 6 of title 28, United States Code, is amended by adding at the
end the following:
``159. Bankruptcy statistics.''.
(c) Effective Date.--The amendments made by this section shall take
effect 18 months after the date of enactment of this Act.
SEC. 702. UNIFORM RULES FOR THE COLLECTION OF BANKRUPTCY DATA.
(a) Amendment.--Title 28 of the United States Code is amended by
inserting after section 589a the following:
``Sec. 589b. Bankruptcy data
``(a) Rules.--The Attorney General shall, within a reasonable time
after the effective date of this section, issue rules requiring uniform
forms for (and from time to time thereafter to appropriately modify and
approve)--
``(1) final reports by trustees in cases under chapters 7,
12, and 13 of title 11; and
``(2) periodic reports by debtors in possession or
trustees, as the case may be, in cases under chapter 11 of
title 11.
``(b) Reports.--All reports referred to in subsection (a) shall be
designed (and the requirements as to place and manner of filing shall
be established) so as to facilitate compilation of data and maximum
possible access of the public, both by physical inspection at 1 or more
central filing locations, and by electronic access through the Internet
or other appropriate media.
``(c) Required Information.--The information required to be filed
in the reports referred to in subsection (b) shall be that which is in
the best interests of debtors and creditors, and in the public interest
in reasonable and adequate information to evaluate the efficiency and
practicality of the Federal bankruptcy system. In issuing rules
proposing the forms referred to in subsection (a), the Attorney General
shall strike the best achievable practical balance between--
``(1) the reasonable needs of the public for information
about the operational results of the Federal bankruptcy system;
and
``(2) economy, simplicity, and lack of undue burden on
persons with a duty to file reports.
``(d) Final Reports.--Final reports proposed for adoption by
trustees under chapters 7, 12, and 13 of title 11 shall, in addition to
such other matters as are required by law or as the Attorney General in
the discretion of the Attorney General, shall propose, include with
respect to a case under such title--
``(1) information about the length of time the case was
pending;
``(2) assets abandoned;
``(3) assets exempted;
``(4) receipts and disbursements of the estate;
``(5) expenses of administration;
``(6) claims asserted;
``(7) claims allowed; and
``(8) distributions to claimants and claims discharged
without payment,
in each case by appropriate category and, in cases under chapters 12
and 13 of title 11, date of confirmation of the plan, each modification
thereto, and defaults by the debtor in performance under the plan.
``(e) Periodic Reports.--Periodic reports proposed for adoption by
trustees or debtors in possession under chapter 11 of title 11 shall,
in addition to such other matters as are required by law or as the
Attorney General, in the discretion of the Attorney General, shall
propose, include--
``(1) information about the standard industry
classification, published by the Department of Commerce, for
the businesses conducted by the debtor;
``(2) length of time the case has been pending;
``(3) number of full-time employees as at the date of the
order for relief and at end of each reporting period since the
case was filed;
``(4) cash receipts, cash disbursements and profitability
of the debtor for the most recent period and cumulatively since
the date of the order for relief;
``(5) compliance with title 11, whether or not tax returns
and tax payments since the date of the order for relief have
been timely filed and made;
``(6) all professional fees approved by the court in the
case for the most recent period and cumulatively since the date
of the order for relief (separately reported, in for the
professional fees incurred by or on behalf of the debtor,
between those that would have been incurred absent a bankruptcy
case and those not); and
``(7) plans of reorganization filed and confirmed and, with
respect thereto, by class, the recoveries of the holders,
expressed in aggregate dollar values and, in the case of
claims, as a percentage of total claims of the class
allowed.''.
(b) Technical Amendment.--The table of sections of chapter 39 of
title 28, United States Code, is amended by adding at the end the
following:
``589b. Bankruptcy data.''.
SEC. 703. SENSE OF THE CONGRESS REGARDING AVAILABILITY OF BANKRUPTCY
DATA.
It is the sense of the Congress that--
(1) the national policy of the United States should be that
all data held by bankruptcy clerks in electronic form, to the
extent such data reflects only public records (as defined in
section 107 of title 11 of the United States Code), should be
released in a usable electronic form in bulk to the public
subject to such appropriate privacy concerns and safeguards as
the Judicial Conference of the United States may determine; and
(2) there should be established a bankruptcy data system in
which--
(A) a single set of data definitions and forms are
used to collect data nationwide; and
(B) data for any particular bankruptcy case are
aggregated in the same electronic record.
TITLE VIII--BANKRUPTCY TAX PROVISIONS
SEC. 801. TREATMENT OF CERTAIN LIENS.
(a) Treatment of Certain Liens.--Section 724 of title 11, United
States Code, is amended--
(1) in subsection (b), in the matter preceding paragraph
(1), by inserting ``(other than to the extent that there is a
properly perfected unavoidable tax lien arising in connection
with an ad valorem tax on real or personal property of the
estate)'' after ``under this title'';
(2) in subsection (b)(2), after ``507(a)(1)'', insert
``(except that such expenses, other than claims for wages,
salaries, or commissions which arise after the filing of a
petition, shall be limited to expenses incurred under chapter 7
of this title and shall not include expenses incurred under
chapter 11 of this title)''; and
(3) by adding at the end the following:
``(e) Before subordinating a tax lien on real or personal property
of the estate, the trustee shall--
``(1) exhaust the unencumbered assets of the estate; and
``(2) in a manner consistent with section 506(c) of this
title, recover from property securing an allowed secured claim
the reasonable, necessary costs and expenses of preserving or
disposing of that property.
``(f) Notwithstanding the exclusion of ad valorem tax liens set
forth in this section and subject to the requirements of subsection
(e)--
``(1) claims for wages, salaries, and commissions that are
entitled to priority under section 507(a)(3) of this title; or
``(2) claims for contributions to an employee benefit plan
entitled to priority under section 507(a)(4) of this title,
may be paid from property of the estate which secures a tax lien, or
the proceeds of such property.''.
(b) Determination of Tax Liability.--Section 505(a)(2) of title 11,
United States Code, is amended--
(1) in subparagraph (A), by striking ``or'' at the end;
(2) in subparagraph (B), by striking the period at the end
and inserting ``; or''; and
(3) by adding at the end the following:
``(C) the amount or legality of any amount arising in
connection with an ad valorem tax on real or personal property
of the estate, if the applicable period for contesting or
redetermining that amount under any law (other than a
bankruptcy law) has expired.''.
SEC. 802. EFFECTIVE NOTICE TO GOVERNMENT.
(a) Effective Notice to Governmental Units.--Section 342 of title
11, United States Code, as amended by section 603, is amended by adding
at the end the following:
``(g) If a debtor lists a governmental unit as a creditor in a list
or schedule, any notice required to be given by the debtor under this
title, any rule, any applicable law, or any order of the court, shall
identify the department, agency, or instrumentality through which the
debtor is indebted. The debtor shall identify (with information such as
a taxpayer identification number, loan, account or contract number, or
real estate parcel number, where applicable), and describe the
underlying basis for the governmental unit's claim. If the debtor's
liability to a governmental unit arises from a debt or obligation owed
or incurred by another individual, entity, or organization, or under a
different name, the debtor shall identify such individual, entity,
organization, or name.
``(h) The clerk shall keep and update quarterly, in the form and
manner as the Director of the Administrative Office of the United
States Courts prescribes, and make available to debtors, a register in
which a governmental unit may designate a safe harbor mailing address
for service of notice in cases pending in the district. A governmental
unit may file a statement with the clerk designating a safe harbor
address to which notices are to be sent, unless such governmental unit
files a notice of change of address.''.
(b) Adoption of Rules Providing Notice.--The Advisory Committee on
Bankruptcy Rules of the Judicial Conference shall, within a reasonable
period of time after the date of the enactment of this Act, propose for
adoption enhanced rules for providing notice to State, Federal, and
local government units that have regulatory authority over the debtor
or which may be creditors in the debtor's case. Such rules shall be
reasonably calculated to ensure that notice will reach the
representatives of the governmental unit, or subdivision thereof, who
will be the proper persons authorized to act upon the notice. At a
minimum, the rules should require that the debtor--
(1) identify in the schedules and the notice, the
subdivision, agency, or entity in respect of which such notice
should be received;
(2) provide sufficient information (such as case captions,
permit numbers, taxpayer identification numbers, or similar
identifying information) to permit the governmental unit or
subdivision thereof, entitled to receive such notice, to
identify the debtor or the person or entity on behalf of which
the debtor is providing notice where the debtor may be a
successor in interest or may not be the same as the person or
entity which incurred the debt or obligation; and
(3) identify, in appropriate schedules, served together
with the notice, the property in respect of which the claim or
regulatory obligation may have arisen, if any, the nature of
such claim or regulatory obligation and the purpose for which
notice is being given.
(c) Effect of Failure of Notice.--Section 342 of title 11, United
States Code, as amended by section 603 and subsection (a), is amended
by adding at the end the following:
``(i) A notice that does not comply with subsections (d) and (e)
shall not be effective unless the debtor demonstrates, by clear and
convincing evidence, that timely notice was given in a manner
reasonably calculated to satisfy the requirements of this section was
given, and that--
``(1) either the notice was timely sent to the safe harbor
address provided in the register maintained by the clerk of the
district in which the case was pending for such purposes; or
``(2) no safe harbor address was provided in such list for
the governmental unit and that an officer of the governmental
unit who is responsible for the matter or claim had actual
knowledge of the case in sufficient time to act.''.
SEC. 803. NOTICE OF REQUEST FOR A DETERMINATION OF TAXES.
Section 505(b) of title 11, United States Code, is amended by
striking ``Unless'' at the beginning of the second sentence thereof and
inserting ``If the request is made substantially in the manner
designated by the governmental unit and unless''.
SEC. 804. RATE OF INTEREST ON TAX CLAIMS.
(a) Amendment.--Chapter 5 of title 11, United States Code, is
amended by adding at the end the following:
``Sec. 511. Rate of interest on tax claims
``If any provision of this title requires the payment of interest
on a tax claim or requires the payment of interest to enable a creditor
to receive the present value of the allowed amount of a tax claim, the
rate of interest shall be as follows:
``(1) In the case of ad valorem tax claims, whether secured
or unsecured, other unsecured tax claims where interest is
required to be paid under section 726(a)(5) of this title,
secured tax claims, and administrative tax claims paid under
section 503(b)(1) of this title, the rate shall be determined
under applicable nonbankruptcy law.
``(2) In the case of all other tax claims, the minimum rate
of interest shall be the Federal short-term rate rounded to the
nearest full percent, determined under section 1274(d) of the
Internal Revenue Code of 1986, plus 3 percentage points.
``(A) In the case of claims for Federal income
taxes, such rate shall be subject to any adjustment
that may be required under section 6621(d) of the
Internal Revenue Code of 1986.
``(B) In the case of taxes paid under a confirmed
plan or reorganization, such rate shall be determined
as of the calendar month in which the plan is
confirmed.''.
(b) Conforming Amendment.--The table of sections of chapter 5 of
title 11, United States Code, is amended by inserting after the item
relating to section 510 the following:
``511. Rate of interest on tax claims.''.
SEC. 805. TOLLING OF PRIORITY OF TAX CLAIM TIME PERIODS.
Section 507(a)(8)(A) of title 11, United States Code, as so
redesignated, is amended--
(1) in clause (i) by inserting after ``petition'' and
before the semicolon ``, plus any time, plus 6 months, during
which the stay of proceedings was in effect in a prior case
under this title''; and
(2) amend clause (ii) to read as follows:
``(ii) assessed within 240 days before the
date of the filing of the petition, exclusive
of--
``(I) any time plus 30 days during
which an offer in compromise with
respect of such tax, was pending or in
effect during such 240-day period;
``(II) any time plus 30 days during
which an installment agreement with
respect of such tax was pending or in
effect during such 240-day period, up
to 1 year; and
``(III) any time plus 6 months
during which a stay of proceedings
against collections was in effect in a
prior case under this title during such
240-day period.''.
SEC. 806. PRIORITY PROPERTY TAXES INCURRED.
Section 507(a)(8)(B) of title 11, United States Code, is amended by
striking ``assessed'' and inserting ``incurred''.
SEC. 807. CHAPTER 13 DISCHARGE OF FRAUDULENT AND OTHER TAXES.
Section 1328(a)(2) of title 11, United States Code, is amended by
inserting ``(1),'' after ``paragraph''.
SEC. 808. CHAPTER 11 DISCHARGE OF FRAUDULENT TAXES.
Section 1141(d) of title 11, United States Code, is amended by
adding at the end the following:
``(6) Notwithstanding the provisions of paragraph (1), the
confirmation of a plan does not discharge a debtor which is a
corporation from any debt for a tax or customs duty with respect to
which the debtor made a fraudulent return or willfully attempted in any
manner to evade or defeat such tax.''.
SEC. 809. STAY OF TAX PROCEEDINGS.
(a) Section 362 Stay Limited to Prepetition Taxes.--Section
362(a)(8) of title 11, United States Code, is amended by striking the
period at the end and inserting ``, in respect of a tax liability for a
taxable period ending before the order for relief.''.
(b) Appeal of Tax Court Decisions Permitted.--Section 362(b)(9) of
title 11, United States Code, is amended--
(1) in subparagraph (C) by striking ``or'' at the end;
(2) in subparagraph (D) by striking the period at the end
and inserting ``; or''; and
(3) by adding at the end the following:
``(E) the appeal of a decision by a court or
administrative tribunal which determines a tax
liability of the debtor without regard to whether such
determination was made prepetition or postpetition.''.
SEC. 810. PERIODIC PAYMENT OF TAXES IN CHAPTER 11 CASES.
Section 1129(a)(9) of title 11, United States Code, is amended--
(1) in subparagraph (B) by striking ``and'' at the end; and
(2) in subparagraph (C)--
(A) by striking ``deferred cash payments, over a
period not exceeding six years after the date of
assessment of such claim,'' and inserting ``regular
installment payments in cash, but in no case with a
balloon provision, and no more than three months apart,
beginning no later than the effective date of the plan
and ending on the earlier of five years after the
petition date or the last date payments are to be made
under the plan to unsecured creditors,'';
(B) by striking the period at the end and inserting
``; and''; and
(3) by adding at the end the following:
``(D) with respect to a secured claim which would
be described in section 507(a)(8) of this title but for
its secured status, the holder of such claim will
receive on account of such claim cash payments of not
less than is required in subparagraph (C) and over a
period no greater than is required in such
subparagraph.''.
SEC. 811. AVOIDANCE OF STATUTORY TAX LIENS PROHIBITED.
Section 545(2) of title 11, United States Code, is amended by
striking the semicolon at the end and inserting ``, except where such
purchaser is a purchaser described in section 6323 of the Internal
Revenue Code of 1986 or similar provision of State or local law;''.
SEC. 812. PAYMENT OF TAXES IN THE CONDUCT OF BUSINESS.
(a) Payment of Taxes Required.--Section 960 of title 28, United
States Code, is amended--
(1) by inserting ``(a)'' before ``Any''; and
(2) by adding at the end the following:
``(b) Such taxes shall be paid when due in the conduct of such
business unless--
``(1) the tax is a property tax secured by a lien against
property that is abandoned within a reasonable time after the
lien attaches, by the trustee of a bankruptcy estate, pursuant
to section 554 of title 11; or
``(2) payment of the tax is excused under a specific
provision of title 11.
``(c) In a case pending under chapter 7 of title 11, payment of a
tax may be deferred until final distribution is made under section 726
of title 11 if--
``(1) the tax was not incurred by a trustee duly appointed
under chapter 7 of title 11; or
``(2) before the due date of the tax, the court has made a
finding of probable insufficiency of funds of the estate to pay
in full the administrative expenses allowed under section
503(b) of title 11 that have the same priority in distribution
under section 726(b) of title 11 as such tax.''.
(b) Payment of Ad Valorem Taxes Required.--Section 503(b)(1)(B) of
title 11, United States Code, is amended in clause (i) by inserting
after ``estate,'' and before ``except'' the following: ``whether
secured or unsecured, including property taxes for which liability is
in rem only, in personam or both,''.
(c) Request for Payment of Administrative Expense Taxes
Eliminated.--Section 503(b)(1) of title 11, United States Code, is
amended by adding at the end the following:
``(D) notwithstanding the requirements of subsection (a) of
this section, a governmental unit shall not be required to file
a request for the payment of a claim described in subparagraph
(B) or (C);''.
(d) Payment of Taxes and Fees as Secured Claims.--Section 506 of
title 11, United States Code, is amended--
(1) in subsection (b) by inserting ``or State statute''
after ``agreement''; and
(2) in subsection (c) by inserting ``, including the
payment of all ad valorem property taxes in respect of the
property'' before the period at the end.
SEC. 813. TARDILY FILED PRIORITY TAX CLAIMS.
Section 726(a)(1) of title 11, United States Code, is amended by
striking ``before the date on which the trustee commences distribution
under this section'' and inserting ``on or before the earlier of 10
days after the mailing to creditors of the summary of the trustee's
final report or the date on which the trustee commences final
distribution under this section''.
SEC. 814. INCOME TAX RETURNS PREPARED BY TAX AUTHORITIES.
Section 523(a)(1)(B) of title 11, United States Code, is amended--
(1) by inserting ``or equivalent report or notice,'' after
``a return,'';
(2) in clause (i)--
(A) by inserting ``or given'' after ``filed''; and
(B) by striking ``or'' at the end;
(3) in clause (ii)--
(A) by inserting ``or given'' after ``filed''; and
(B) by inserting ``, report, or notice'' after
``return''; and
(4) by adding at the end the following:
``(iii) for purposes of this subsection, a
return--
``(I) must satisfy the requirements
of applicable nonbankruptcy law, and
includes a return prepared pursuant to
section 6020(a) of the Internal Revenue
Code of 1986, or similar State or local
law, or a written stipulation to a
judgment entered by a nonbankruptcy
tribunal, but does not include a return
made pursuant to section 6020(b) of the
Internal Revenue Code of 1986, or
similar State or local law; and
``(II) must have been filed in a
manner permitted by applicable
nonbankruptcy law; or''.
SEC. 815. DISCHARGE OF THE ESTATE'S LIABILITY FOR UNPAID TAXES.
Section 505(b) of title 11, United States Code, is amended in the
second sentence by inserting ``the estate,'' after
``misrepresentation,''.
SEC. 816. REQUIREMENT TO FILE TAX RETURNS TO CONFIRM CHAPTER 13 PLANS.
(a) Filing of Prepetition Tax Returns Required for Plan
Confirmation.--Section 1325(a) of title 11, United States Code, as
amended by section 140, is amended--
(1) in paragraph (6) by striking ``and'' at the end;
(2) in paragraph (7) by striking the period at the end and
inserting ``; and''; and
(3) by adding at the end the following:
``(8) if the debtor has filed all Federal, State, and local
tax returns as required by section 1308 of this title.''.
(b) Additional Time Permitted for Filing Tax Returns.--(1) Chapter
13 of title 11, United States Code, as amended by section 135, is
amended by adding at the end the following:
``Sec. 1308. Filing of prepetition tax returns
``(a) On or before the day prior to the day on which the first
meeting of the creditors is convened under section 341(a) of this
title, the debtor shall have filed with appropriate tax authorities all
tax returns for all taxable periods ending in the 3-year period ending
on the date of filing of the petition.
``(b) If the tax returns required by subsection (a) have not been
filed by the date on which the first meeting of creditors is convened
under section 341(a) of this title, the trustee may continue such
meeting for a reasonable period of time, to allow the debtor additional
time to file any unfiled returns, but such additional time shall be no
more than--
``(1) for returns that are past due as of the date of the
filing of the petition, 120 days from such date;
``(2) for returns which are not past due as of the date of
the filing of the petition, the later of 120 days from such
date or the due date for such returns under the last automatic
extension of time for filing such returns to which the debtor
is entitled, and for which request has been timely made,
according to applicable nonbankruptcy law; and
``(3) upon notice and hearing, and order entered before the
lapse of any deadline fixed according to this subsection, where
the debtor demonstrates, by clear and convincing evidence, that
the failure to file the returns as required is because of
circumstances beyond the control of the debtor, the court may
extend the deadlines set by the trustee as provided in this
subsection for--
``(A) a period of no more than 30 days for returns
described in paragraph (1) of this subsection; and
``(B) for no more than the period of time ending on
the applicable extended due date for the returns
described in paragraph (2).
``(c) For purposes of this section only, a return includes a return
prepared pursuant to section 6020 (a) or (b) of the Internal Revenue
Code of 1986 or similar State or local law, or a written stipulation to
a judgment entered by a nonbankruptcy tribunal.''.
(2) The table of sections of chapter 13 of title 11, United States
Code, is amended by inserting after the item relating to section 1307
the following:
``1308. Filing of prepetition tax returns.''.
(c) Dismissal or Conversion on Failure To Comply.--Section 1307 of
title 11, United States Code, is amended--
(1) by redesignating subsections (e) and (f) as subsections
(f) and (g), respectively; and
(2) by inserting after subsection (d) the following:
``(e) Upon the failure of the debtor to file tax returns under
section 1308 of this title, on request of a party in interest or the
United States trustee and after notice and a hearing, the court shall
dismiss a case or convert a case under this chapter to a case under
chapter 7 of this title, whichever is in the best interests of
creditors and the estate.''.
(d) Timely Filed Claims.--Section 502(b)(9) of title 11, United
States Code, is amended by striking the period at the end and inserting
``, and except that in a case under chapter 13 of this title, a claim
of a governmental unit for a tax in respect of a return filed under
section 1308 of this title shall be timely if it is filed on or before
60 days after such return or returns were filed as required.''.
(e) Rules for Objections to Claims and to Confirmation.--It is the
sense of the Congress that the Advisory Committee on Bankruptcy Rules
of the Judicial Conference should, within a reasonable period of time
after the date of the enactment of this Act, propose for adoption
amended Federal Rules of Bankruptcy Procedure which provide that--
(1) notwithstanding the provisions of Rule 3015(f), in
cases under chapter 13 of title 11, United States Code, a
governmental unit may object to the confirmation of a plan on
or before 60 days after the debtor files all tax returns
required under sections 1308 and 1325(a)(7) of title 11, United
States Code; and
(2) in addition to the provisions of Rule 3007, in a case
under chapter 13 of title 11, United States Code, no objection
to a tax in respect of a return required to be filed under such
section 1308 shall be filed until such return has been filed as
required.
SEC. 817. STANDARDS FOR TAX DISCLOSURE.
Section 1125(a) of title 11, United States Code, is amended in
paragraph (1)--
(1) by inserting after ``records,'' the following:
``including a full discussion of the potential material
Federal, State, and local tax consequences of the plan to the
debtor, any successor to the debtor, and a hypothetical
investor domiciled in the State in which the debtor resides or
has its principal place of business typical of the holders of
claims or interests in the case,'';
(2) by inserting ``such'' after ``enable''; and
(3) by striking ``reasonable'' where it appears after
``hypothetical'' and by striking ``typical of holders of claims
or interests'' after ``investor''.
SEC. 818. SETOFF OF TAX REFUNDS.
Section 362(b) of title 11, United States Code, as amended by
sections 118, 132, 136, and 203, is amended--
(1) in paragraph (29) by striking ``or'';
(2) in paragraph (30) by striking the period at the end and
inserting ``; or''; and
(3) by inserting after paragraph (30) the following:
``(31) under subsection (a) of the setoff of an income tax
refund, by a governmental unit, in respect of a taxable period
which ended before the order for relief against an income tax
liability for a taxable period which also ended before the
order for relief, unless--
``(A) prior to such setoff, an action to determine
the amount or legality of such tax liability under
section 505(a) was commenced; or
``(B) where the setoff of an income tax refund is
not permitted because of a pending action to determine
the amount or legality of a tax liability, the
governmental unit may hold the refund pending the
resolution of the action.''.
TITLE IX--ANCILLARY AND OTHER CROSS-BORDER CASES
SEC. 901. AMENDMENT TO ADD CHAPTER 15 TO TITLE 11, UNITED STATES CODE.
(a) In General.--Title 11, United States Code, is amended by
inserting after chapter 13 the following:
``CHAPTER 15--ANCILLARY AND OTHER CROSS-BORDER CASES
``Sec.
``1501. Purpose and scope of application.
``SUBCHAPTER I--GENERAL PROVISIONS
``1502. Definitions.
``1503. International obligations of the United States.
``1504. Commencement of ancillary case.
``1505. Authorization to act in a foreign country.
``1506. Public policy exception.
``1507. Additional assistance.
``1508. Interpretation.
``SUBCHAPTER II--ACCESS OF FOREIGN REPRESENTATIVES AND CREDITORS TO THE
COURT
``1509. Right of direct access.
``1510. Limited jurisdiction.
``1511. Commencement of case under section 301 or 303.
``1512. Participation of a foreign representative in a case under this
title.
``1513. Access of foreign creditors to a case under this title.
``1514. Notification to foreign creditors concerning a case under this
title.
``SUBCHAPTER III--RECOGNITION OF A FOREIGN PROCEEDING AND RELIEF
``1515. Application for recognition of a foreign proceeding.
``1516. Presumptions concerning recognition.
``1517. Order recognizing a foreign proceeding.
``1518. Subsequent information.
``1519. Relief that may be granted upon petition for recognition of a
foreign proceeding.
``1520. Effects of recognition of a foreign main proceeding.
``1521. Relief that may be granted upon recognition of a foreign
proceeding.
``1522. Protection of creditors and other interested persons.
``1523. Actions to avoid acts detrimental to creditors.
``1524. Intervention by a foreign representative.
``SUBCHAPTER IV--COOPERATION WITH FOREIGN COURTS AND FOREIGN
REPRESENTATIVES
``1525. Cooperation and direct communication between the court and
foreign courts or foreign representatives.
``1526. Cooperation and direct communication between the trustee and
foreign courts or foreign representatives.
``1527. Forms of cooperation.
``SUBCHAPTER V--CONCURRENT PROCEEDINGS
``1528. Commencement of a case under this title after recognition of a
foreign main proceeding.
``1529. Coordination of a case under this title and a foreign
proceeding.
``1530. Coordination of more than 1 foreign proceeding.
``1531. Presumption of insolvency based on recognition of a foreign
main proceeding.
``1532. Rule of payment in concurrent proceedings.
``Sec. 1501. Purpose and scope of application
``(a) The purpose of this chapter is to incorporate the Model Law
on Cross-Border Insolvency so as to provide effective mechanisms for
dealing with cases of cross-border insolvency with the objectives of--
``(1) cooperation between--
``(A) United States courts, United States trustees,
trustees, examiners, debtors, and debtors in
possession; and
``(B) the courts and other competent authorities of
foreign countries involved in cross-border insolvency
cases;
``(2) greater legal certainty for trade and investment;
``(3) fair and efficient administration of cross-border
insolvencies that protects the interests of all creditors, and
other interested entities, including the debtor;
``(4) protection and maximization of the value of the
debtor's assets; and
``(5) facilitation of the rescue of financially troubled
businesses, thereby protecting investment and preserving
employment.
``(b) This chapter applies where--
``(1) assistance is sought in the United States by a
foreign court or a foreign representative in connection with a
foreign proceeding;
``(2) assistance is sought in a foreign country in
connection with a case under this title;
``(3) a foreign proceeding and a case under this title with
respect to the same debtor are taking place concurrently; or
``(4) creditors or other interested persons in a foreign
country have an interest in requesting the commencement of, or
participating in, a case or proceeding under this title.
``(c) This chapter does not apply to--
``(1) a proceeding concerning an entity identified by
exclusion in subsection 109(b);
``(2) an individual, or to an individual and such
individual's spouse, who have debts within the limits specified
in section 109(e) and who are citizens of the United States or
aliens lawfully admitted for permanent residence in the United
States; or
``(3) an entity subject to a proceeding under the
Securities Investor Protection Act, a stockbroker subject to
subchapter III of chapter 7 of this title, or a commodity
broker subject to subchapter IV of chapter 7 of this title.
``SUBCHAPTER I--GENERAL PROVISIONS
``Sec. 1502. Definitions
``For the purposes of this chapter, the term--
``(1) `debtor' means an entity that is the subject of a
foreign proceeding;
``(2) `establishment' means any place of operations where
the debtor carries out a nontransitory economic activity;
``(3) `foreign court' means a judicial or other authority
competent to control or supervise a foreign proceeding;
``(4) `foreign main proceeding' means a foreign proceeding
taking place in the country where the debtor has the center of
its main interests;
``(5) `foreign nonmain proceeding' means a foreign
proceeding, other than a foreign main proceeding, taking place
in a country where the debtor has an establishment;
``(6) `trustee' includes a trustee, a debtor in possession
in a case under any chapter of this title, or a debtor under
chapter 9 of this title; and
``(7) `within the territorial jurisdiction of the United
States' when used with reference to property of a debtor refers
to tangible property located within the territory of the United
States and intangible property deemed under applicable
nonbankruptcy law to be located within that territory,
including any property subject to attachment or garnishment
that may properly be seized or garnished by an action in a
Federal or State court in the United States.
``Sec. 1503. International obligations of the United States
``To the extent that this chapter conflicts with an obligation of
the United States arising out of any treaty or other form of agreement
to which it is a party with 1 or more other countries, the requirements
of the treaty or agreement prevail.
``Sec. 1504. Commencement of ancillary case
``A case under this chapter is commenced by the filing of a
petition for recognition of a foreign proceeding under section 1515.
``Sec. 1505. Authorization to act in a foreign country
``A trustee or another entity (including an examiner) may be
authorized by the court to act in a foreign country on behalf of an
estate created under section 541. An entity authorized to act under
this section may act in any way permitted by the applicable foreign
law.
``Sec. 1506. Public policy exception
``Nothing in this chapter prevents the court from refusing to take
an action governed by this chapter if the action would be manifestly
contrary to the public policy of the United States.
``Sec. 1507. Additional assistance
``(a) Subject to the specific limitations stated elsewhere in this
chapter the court, upon recognition of a foreign proceeding, the court
may provide additional assistance to a foreign representative under
this title or under other laws of the United States.
``(b) In determining whether to provide additional assistance under
this title or under other laws of the United States, the court shall
consider whether such additional assistance, consistent with the
principles of comity, will reasonably assure--
``(1) just treatment of all holders of claims against or
interests in the debtor's property;
``(2) protection of claim holders in the United States
against prejudice and inconvenience in the processing of claims
in such foreign proceeding;
``(3) prevention of preferential or fraudulent dispositions
of property of the debtor;
``(4) distribution of proceeds of the debtor's property
substantially in accordance with the order prescribed by this
title; and
``(5) if appropriate, the provision of an opportunity for a
fresh start for the individual that such foreign proceeding
concerns.
``Sec. 1508. Interpretation
``In interpreting this chapter, the court shall consider its
international origin, and the need to promote an application of this
chapter that is consistent with the application of similar statutes
adopted by foreign jurisdictions.
``SUBCHAPTER II--ACCESS OF FOREIGN REPRESENTATIVES AND CREDITORS TO THE
COURT
``Sec. 1509. Right of direct access
``(a) A foreign representative may commence a case under section
1504 of this title by filing with the court a petition for recognition
of a foreign proceeding under section 1515 of this title.
``(b) If the court grants recognition under section 1515 of this
title, and subject to any limitations that the court may impose
consistent with the policy of this chapter--
``(1) the foreign representative has the capacity to sue
and be sued in a court in the United States;
``(2) the foreign representative may apply directly to a
court in the United States for appropriate relief in that
court; and
``(3) a court in the United States shall grant comity or
cooperation to the foreign representative.
``(c) A request for comity or cooperation by a foreign
representative in a court in the United States shall be accompanied by
a certified copy of an order granting recognition under section 1517 of
this title.
``(d) If the court denies recognition under this chapter, the court
may issue any appropriate order necessary to prevent the foreign
representative from obtaining comity or cooperation from courts in the
United States.
``(e) Whether or not the court grants recognition, and subject to
sections 306 and 1510 of this title, a foreign representative is
subject to applicable nonbankruptcy law.
``(f) Notwithstanding any other provision of this section, the
failure of a foreign representative to commence a case or to obtain
recognition under this chapter does not affect any right the foreign
representative may have to sue in a court in the United State to
collect or recover a claim which is the property of the debtor.''.
``Sec. 1510. Limited jurisdiction
``The sole fact that a foreign representative files a petition
under section 1515 does not subject the foreign representative to the
jurisdiction of any court in the United States for any other purpose.
``Sec. 1511. Commencement of case under section 301 or 303
``(a) Upon recognition, a foreign representative may commence--
``(1) an involuntary case under section 303; or
``(2) a voluntary case under section 301 or 302, if the
foreign proceeding is a foreign main proceeding.
``(b) The petition commencing a case under subsection (a) must be
accompanied by certified copy of an order granting recognition. The
court where the petition for recognition has been filed must be advised
of the foreign representative's intent to commence a case under
subsection (a) prior to such commencement.
``Sec. 1512. Participation of a foreign representative in a case under
this title
``Upon recognition of a foreign proceeding, the foreign
representative in that proceeding is entitled to participate as a party
in interest in a case regarding the debtor under this title.
``Sec. 1513. Access of foreign creditors to a case under this title
``(a) Foreign creditors have the same rights regarding the
commencement of, and participation in, a case under this title as
domestic creditors.
``(b)(1) Subsection (a) does not change or codify present law as to
the priority of claims under section 507 or 726 of this title, except
that the claim of a foreign creditor under those sections shall not be
given a lower priority than that of general unsecured claims without
priority solely because the holder of such claim is a foreign creditor.
``(2)(A) Subsection (a) and paragraph (1) do not change or codify
present law as to the allowability of foreign revenue claims or other
foreign public law claims in a proceeding under this title.
``(B) Allowance and priority as to a foreign tax claim or other
foreign public law claim shall be governed by any applicable tax treaty
of the United States, under the conditions and circumstances specified
therein.
``Sec. 1514. Notification to foreign creditors concerning a case under
this title
``(a) Whenever in a case under this title notice is to be given to
creditors generally or to any class or category of creditors, such
notice shall also be given to the known creditors generally, or to
creditors in the notified class or category, that do not have addresses
in the United States. The court may order that appropriate steps be
taken with a view to notifying any creditor whose address is not yet
known.
``(b) Such notification to creditors with foreign addresses
described in subsection (a) shall be given individually, unless the
court considers that, under the circumstances, some other form of
notification would be more appropriate. No letters rogatory or other
similar formality is required.
``(c) When a notification of commencement of a case is to be given
to foreign creditors, the notification shall--
``(1) indicate the time period for filing proofs of claim
and specify the place for their filing;
``(2) indicate whether secured creditors need to file their
proofs of claim; and
``(3) contain any other information required to be included
in such a notification to creditors under this title and the
orders of the court.
``(d) Any rule of procedure or order of the court as to notice or
the filing of a claim shall provide such additional time to creditors
with foreign addresses as is reasonable under the circumstances.
``SUBCHAPTER III--RECOGNITION OF A FOREIGN PROCEEDING AND RELIEF
``Sec. 1515. Application for recognition of a foreign proceeding
``(a) A foreign representative applies to the court for recognition
of the foreign proceeding in which the foreign representative has been
appointed by filing a petition for recognition.
``(b) A petition for recognition shall be accompanied by--
``(1) a certified copy of the decision commencing the
foreign proceeding and appointing the foreign representative;
``(2) a certificate from the foreign court affirming the
existence of the foreign proceeding and of the appointment of
the foreign representative; or
``(3) in the absence of evidence referred to in paragraphs
(1) and (2), any other evidence acceptable to the court of the
existence of the foreign proceeding and of the appointment of
the foreign representative.
``(c) A petition for recognition shall also be accompanied by a
statement identifying all foreign proceedings with respect to the
debtor that are known to the foreign representative.
``(d) The documents referred to in paragraphs (1) and (2) of
subsection (b) must be translated into English. The court may require a
translation into English of additional documents.
``Sec. 1516. Presumptions concerning recognition
``(a) If the decision or certificate referred to in section 1515(b)
indicates that the foreign proceeding is a foreign proceeding as
defined in section 101 and that the person or body is a foreign
representative as defined in section 101, the court is entitled to so
presume.
``(b) The court is entitled to presume that documents submitted in
support of the petition for recognition are authentic, whether or not
they have been legalized.
``(c) In the absence of evidence to the contrary, the debtor's
registered office, or habitual residence in the case of an individual,
is presumed to be the center of the debtor's main interests.
``Sec. 1517. Order recognizing a foreign proceeding
``(a) Subject to section 1506, after notice and a hearing an order
recognizing a foreign proceeding shall be entered if--
``(1) the foreign proceeding is a foreign main proceeding
or foreign nonmain proceeding within the meaning of section
1502;
``(2) the foreign representative applying for recognition
is a person or body as defined in section 101; and
``(3) the petition meets the requirements of section 1515.
``(b) The foreign proceeding shall be recognized--
``(1) as a foreign main proceeding if it is taking place in
the country where the debtor has the center of its main
interests; or
``(2) as a foreign nonmain proceeding if the debtor has an
establishment within the meaning of section 1502 in the foreign
country where the proceeding is pending.
``(c) A petition for recognition of a foreign proceeding shall be
decided upon at the earliest possible time. Entry of an order
recognizing a foreign proceeding constitutes recognition under this
chapter.
``(d) The provisions of this subchapter do not prevent modification
or termination of recognition if it is shown that the grounds for
granting it were fully or partially lacking or have ceased to exist,
but in considering such action the court shall give due weight to
possible prejudice to parties that have relied upon the granting of
recognition. The case under this chapter may be closed in the manner
prescribed under section 350.
``Sec. 1518. Subsequent information
``From the time of filing the petition for recognition of the
foreign proceeding, the foreign representative shall file with the
court promptly a notice of change of status concerning--
``(1) any substantial change in the status of the foreign
proceeding or the status of the foreign representative's
appointment; and
``(2) any other foreign proceeding regarding the debtor
that becomes known to the foreign representative.
``Sec. 1519. Relief that may be granted upon petition for recognition
of a foreign proceeding
``(a) From the time of filing a petition for recognition until the
court rules on the petition, the court may, at the request of the
foreign representative, where relief is urgently needed to protect the
assets of the debtor or the interests of the creditors, grant relief of
a provisional nature, including--
``(1) staying execution against the debtor's assets;
``(2) entrusting the administration or realization of all
or part of the debtor's assets located in the United States to
the foreign representative or another person authorized by the
court, including an examiner, in order to protect and preserve
the value of assets that, by their nature or because of other
circumstances, are perishable, susceptible to devaluation or
otherwise in jeopardy; and
``(3) any relief referred to in paragraph (3), (4), or (7)
of section 1521(a).
``(b) Unless extended under section 1521(a)(6), the relief granted
under this section terminates when the petition for recognition is
decided upon.
``(c) It is a ground for denial of relief under this section that
such relief would interfere with the administration of a foreign main
proceeding.
``(d) The court may not enjoin a police or regulatory act of a
governmental unit, including a criminal action or proceeding, under
this section.
``(e) The standards, procedures, and limitations applicable to an
injunction shall apply to relief under this section.
``Sec. 1520. Effects of recognition of a foreign main proceeding
``(a) Upon recognition of a foreign proceeding that is a foreign
main proceeding--
``(1) sections 361 and 362 with respect to the debtor and
that property of the debtor that is within the territorial
jurisdiction of the United States;
``(2) sections 363, 549, and 552 of this title apply to a
transfer of an interest of the debtor in property that is
within the territorial jurisdiction of the United States to the
same extent that the sections would apply to property of an
estate;
``(3) unless the court orders otherwise, the foreign
representative may operate the debtor's business and may
exercise the rights and powers of a trustee under and to the
extent provided by sections 363 and 552; and
``(4) section 552 applies to property of the debtor that is
within the territorial jurisdiction of the United States.''.
``(b) Subsection (a) does not affect the right to commence an
individual action or proceeding in a foreign country to the extent
necessary to preserve a claim against the debtor.
``(c) Subsection (a) does not affect the right of a foreign
representative or an entity to file a petition commencing a case under
this title or the right of any party to file claims or take other
proper actions in such a case.
``Sec. 1521. Relief that may be granted upon recognition of a foreign
proceeding
``(a) Upon recognition of a foreign proceeding, whether main or
nonmain, where necessary to effectuate the purpose of this chapter and
to protect the assets of the debtor or the interests of the creditors,
the court may, at the request of the foreign representative, grant any
appropriate relief, including--
``(1) staying the commencement or continuation of an
individual action or proceeding concerning the debtor's assets,
rights, obligations or liabilities to the extent they have not
been stayed under section 1520(a);
``(2) staying execution against the debtor's assets to the
extent it has not been stayed under section 1520(a);
``(3) suspending the right to transfer, encumber or
otherwise dispose of any assets of the debtor to the extent
this right has not been suspended under section 1520(a);
``(4) providing for the examination of witnesses, the
taking of evidence or the delivery of information concerning
the debtor's assets, affairs, rights, obligations or
liabilities;
``(5) entrusting the administration or realization of all
or part of the debtor's assets within the territorial
jurisdiction of the United States to the foreign representative
or another person, including an examiner, authorized by the
court;
``(6) extending relief granted under section 1519(a); and
``(7) granting any additional relief that may be available
to a trustee, except for relief available under sections 522,
544, 545, 547, 548, 550, and 724(a).
``(b) Upon recognition of a foreign proceeding, whether main or
nonmain, the court may, at the request of the foreign representative,
entrust the distribution of all or part of the debtor's assets located
in the United States to the foreign representative or another person,
including an examiner, authorized by the court, provided that the court
is satisfied that the interests of creditors in the United States are
sufficiently protected.
``(c) In granting relief under this section to a representative of
a foreign nonmain proceeding, the court must be satisfied that the
relief relates to assets that, under the law of the United States,
should be administered in the foreign nonmain proceeding or concerns
information required in that proceeding.
``(d) The court may not enjoin a police or regulatory act of a
governmental unit, including a criminal action or proceeding, under
this section.
``(e) The standards, procedures, and limitations applicable to an
injunction shall apply to relief under paragraphs (1), (2), (3), and
(6) of subsection (a).
``Sec. 1522. Protection of creditors and other interested persons
``(a) The court may grant relief under section 1519 or 1521, or may
modify or terminate relief under subsection (c), only if the interests
of the creditors and other interested entities, including the debtor,
are sufficiently protected.
``(b) The court may subject relief granted under section 1519 or
1521, or the operation of the debtor's business under section
1520(a)(3) of this title, to conditions it considers appropriate,
including the giving of security or the filing of a bond.
``(c) The court may, at the request of the foreign representative
or an entity affected by relief granted under section 1519 or 1521, or
at its own motion, modify or terminate such relief.
``(d) Section 1104(d) shall apply to the appointment of an examiner
under this chapter. Any examiner shall comply with the qualification
requirements imposed on a trustee by section 322.
``Sec. 1523. Actions to avoid acts detrimental to creditors
``(a) Upon recognition of a foreign proceeding, the foreign
representative has standing in a case concerning the debtor pending
under another chapter of this title to initiate actions under sections
522, 544, 545, 547, 548, 550, and 724(a).
``(b) When the foreign proceeding is a foreign nonmain proceeding,
the court must be satisfied that an action under subsection (a) relates
to assets that, under United States law, should be administered in the
foreign nonmain proceeding.
``Sec. 1524. Intervention by a foreign representative
``Upon recognition of a foreign proceeding, the foreign
representative may intervene in any proceedings in a State or Federal
court in the United States in which the debtor is a party.
``SUBCHAPTER IV--COOPERATION WITH FOREIGN COURTS AND FOREIGN
REPRESENTATIVES
``Sec. 1525. Cooperation and direct communication between the court and
foreign courts or foreign representatives
``(a) Consistent with section 1501, the court shall cooperate to
the maximum extent possible with foreign courts or foreign
representatives, either directly or through the trustee.
``(b) The court is entitled to communicate directly with, or to
request information or assistance directly from, foreign courts or
foreign representatives, subject to the rights of parties in interest
to notice and participation.
``Sec. 1526. Cooperation and direct communication between the trustee
and foreign courts or foreign representatives
``(a) Consistent with section 1501, the trustee or other person,
including an examiner, authorized by the court, shall, subject to the
supervision of the court, cooperate to the maximum extent possible with
foreign courts or foreign representatives.
``(b) The trustee or other person, including an examiner,
authorized by the court is entitled, subject to the supervision of the
court, to communicate directly with foreign courts or foreign
representatives.
``Sec. 1527. Forms of cooperation
``Cooperation referred to in sections 1525 and 1526 may be
implemented by any appropriate means, including--
``(1) appointment of a person or body, including an
examiner, to act at the direction of the court;
``(2) communication of information by any means considered
appropriate by the court;
``(3) coordination of the administration and supervision of
the debtor's assets and affairs;
``(4) approval or implementation of agreements concerning
the coordination of proceedings; and
``(5) coordination of concurrent proceedings regarding the
same debtor.
``SUBCHAPTER V--CONCURRENT PROCEEDINGS
``Sec. 1528. Commencement of a case under this title after recognition
of a foreign main proceeding
``After recognition of a foreign main proceeding, a case under
another chapter of this title may be commenced only if the debtor has
assets in the United States. The effects of such case shall be
restricted to the assets of the debtor that are within the territorial
jurisdiction of the United States and, to the extent necessary to
implement cooperation and coordination under sections 1525, 1526, and
1527, to other assets of the debtor that are within the jurisdiction of
the court under sections 541(a) of this title, and 1334(e) of title 28,
to the extent that such other assets are not subject to the
jurisdiction and control of a foreign proceeding that has been
recognized under this chapter.
``Sec. 1529. Coordination of a case under this title and a foreign
proceeding
``Where a foreign proceeding and a case under another chapter of
this title are taking place concurrently regarding the same debtor, the
court shall seek cooperation and coordination under sections 1525,
1526, and 1527, and the following shall apply:
``(1) When the case in the United States is taking place at
the time the petition for recognition of the foreign proceeding
is filed--
``(A) any relief granted under sections 1519 or
1521 must be consistent with the relief granted in the
case in the United States; and
``(B) even if the foreign proceeding is recognized
as a foreign main proceeding, section 1520 does not
apply.
``(2) When a case in the United States under this title
commences after recognition, or after the filing of the
petition for recognition, of the foreign proceeding--
``(A) any relief in effect under sections 1519 or
1521 shall be reviewed by the court and shall be
modified or terminated if inconsistent with the case in
the United States; and
``(B) if the foreign proceeding is a foreign main
proceeding, the stay and suspension referred to in
section 1520(a) shall be modified or terminated if
inconsistent with the relief granted in the case in the
United States.
``(3) In granting, extending, or modifying relief granted
to a representative of a foreign nonmain proceeding, the court
must be satisfied that the relief relates to assets that, under
the law of the United States, should be administered in the
foreign nonmain proceeding or concerns information required in
that proceeding.
``(4) In achieving cooperation and coordination under
sections 1528 and 1529, the court may grant any of the relief
authorized under section 305.
``Sec. 1530. Coordination of more than 1 foreign proceeding
``In matters referred to in section 1501, with respect to more than
1 foreign proceeding regarding the debtor, the court shall seek
cooperation and coordination under sections 1525, 1526, and 1527, and
the following shall apply:
``(1) Any relief granted under section 1519 or 1521 to a
representative of a foreign nonmain proceeding after
recognition of a foreign main proceeding must be consistent
with the foreign main proceeding.
``(2) If a foreign main proceeding is recognized after
recognition, or after the filing of a petition for recognition,
of a foreign nonmain proceeding, any relief in effect under
section 1519 or 1521 shall be reviewed by the court and shall
be modified or terminated if inconsistent with the foreign main
proceeding.
``(3) If, after recognition of a foreign nonmain
proceeding, another foreign nonmain proceeding is recognized,
the court shall grant, modify, or terminate relief for the
purpose of facilitating coordination of the proceedings.
``Sec. 1531. Presumption of insolvency based on recognition of a
foreign main proceeding
``In the absence of evidence to the contrary, recognition of a
foreign main proceeding is for the purpose of commencing a proceeding
under section 303, proof that the debtor is generally not paying its
debts as such debts become due.
``Sec. 1532. Rule of payment in concurrent proceedings
``Without prejudice to secured claims or rights in rem, a creditor
who has received payment with respect to its claim in a foreign
proceeding pursuant to a law relating to insolvency may not receive a
payment for the same claim in a case under any other chapter of this
title regarding the debtor, so long as the payment to other creditors
of the same class is proportionately less than the payment the creditor
has already received.''.
(b) Clerical Amendment.--The table of chapters for title 11, United
States Code, is amended by inserting after the item relating to chapter
13 the following:
``15. Ancillary and Other Cross-Border Cases................ 1501''.
SEC. 902. AMENDMENTS TO OTHER CHAPTERS IN TITLE 11, UNITED STATES CODE.
(a) Applicability of Chapters.--Section 103 of title 11, United
States Code, is amended--
(1) in subsection (a), by inserting before the period the
following: ``, and this chapter, sections 307, 304, 555 through
557, 559, and 560 apply in a case under chapter 15''; and
(2) by adding at the end the following:
``(j) Chapter 15 applies only in a case under such chapter, except
that--
``(1) sections 1505, 1513, and 1514 apply in all cases
under this title; and
``(2) section 1509 applies whether or not a case under this
title is pending.''.
(b) Definitions.--Paragraphs (23) and (24) of title 11, United
States Code, are amended to read as follows:
``(23) `foreign proceeding' means a collective judicial or
administrative proceeding in a foreign country, including an
interim proceeding, under a law relating to insolvency or
adjustment of debt in which proceeding the assets and affairs
of the debtor are subject to control or supervision by a
foreign court, for the purpose of reorganization or
liquidation;
``(24) `foreign representative' means a person or body,
including a person or body appointed on an interim basis,
authorized in a foreign proceeding to administer the
reorganization or the liquidation of the debtor's assets or
affairs or to act as a representative of the foreign
proceeding;''.
(c) Amendments to Title 28, United States Code.--
(1) Procedures.--Section 157(b)(2) of title 28, United
States Code, is amended--
(A) in subparagraph (N), by striking ``and'' at the
end;
(B) in subparagraph (O), by striking the period at
the end and inserting ``; and''; and
(C) by adding at the end the following:
``(P) recognition of foreign proceedings and other matters
under chapter 15 of title 11.''.
(2) Bankruptcy cases and proceedings.--Section 1334(c) of
title 28, United States Code, is amended by striking ``Nothing
in'' and inserting ``Except with respect to a case under
chapter 15 of title 11, nothing in''.
(3) Duties of trustees.--Section 586(a)(3) of title 28,
United States Code, is amended by striking ``or 13'' and
inserting ``13, or 15,'' after ``chapter''.
(4) Section 305(a)(2) of title 11, United States Code, is
amended to read:
``(2)(A) a petition under section 1515 of this title for
recognition of a foreign proceeding has been granted; and
``(B) the purposes of chapter 15 of this title would be
best served by such dismissal or suspension.''.
(5) Section 508 of title 11, United States Code, is amended
by striking subsection (a) and by striking out the letter
``(b)'' at the beginning of the second paragraph.
TITLE X--FINANCIAL CONTRACT PROVISIONS
SEC. 1001. TREATMENT OF CERTAIN AGREEMENTS BY CONSERVATORS OR --
RECEIVERS OF INSURED DEPOSITORY INSTITUTIONS.
(a) Definition of Qualified Financial Contract.--Section
11(e)(8)(D)(i) of the Federal Deposit Insurance Act (12 U.S.C.
1821(e)(8)(D)(i)) is amended by inserting ``, resolution or order''
after ``any similar agreement that the Corporation determines by
regulation''.
(b) Definition of Securities Contract.--Section 11(e)(8)(D)(ii) of
the Federal Deposit Insurance Act (12 U.S.C. 1821(e)(8)(D)(ii)) is
amended to read as follows:
``(ii) Securities contract.--The term
`securities contract'--
``(I) means a contract for the
purchase, sale, or loan of a security,
a certificate of deposit, a mortgage
loan, or any interest in a mortgage
loan, a group or index of securities,
certificates of deposit, or mortgage
loans or interests therein (including
any interest therein or based on the
value thereof) or any option on any of
the foregoing, including any option to
purchase or sell any such security,
certificate of deposit, loan, interest, group or index, or option;
``(II) does not include any
purchase, sale, or repurchase
obligation under a participation in a
commercial mortgage loan unless the
Corporation determines by regulation,
resolution, or order to include any
such agreement within the meaning of
such term;
``(III) means any option entered
into on a national securities exchange
relating to foreign currencies;
``(IV) means the guarantee by or to
any securities clearing agency of any
settlement of cash, securities,
certificates of deposit, mortgage loans
or interests therein, group or index of
securities, certificates of deposit, or
mortgage loans or interests therein
(including any interest therein or
based on the value thereof) or option
on any of the foregoing, including any
option to purchase or sell any such
security, certificate of deposit, loan,
interest, group or index or option;
``(V) means any margin loan;
``(VI) means any other agreement or
transaction that is similar to any
agreement or transaction referred to in
this clause;
``(VII) means any combination of
the agreements or transactions referred
to in this clause;
``(VIII) means any option to enter
into any agreement or transaction
referred to in this clause;
``(IX) means a master agreement
that provides for an agreement or
transaction referred to in subclause
(I), (III), (IV), (V), (VI), (VII), or
(VIII), together with all supplements
to any such master agreement, without
regard to whether the master agreement
provides for an agreement or
transaction that is not a securities
contract under this clause, except that
the master agreement shall be
considered to be a securities contract
under this clause only with respect to
each agreement or transaction under the
master agreement that is referred to in
subclause (I), (III), (IV), (V), (VI),
(VII), or (VIII); and
``(X) means any security agreement
or arrangement or other credit
enhancement related to any agreement or
transaction referred to in this
clause.''.
(c) Definition of Commodity Contract.--Section 11(e)(8)(D)(iii) of
the Federal Deposit Insurance Act (12 U.S.C. 1821(e)(8)(D)(iii)) is
amended to read as follows:
``(iii) Commodity contract.--The term
`commodity contract' means--
``(I) with respect to a futures
commission merchant, a contract for the
purchase or sale of a commodity for
future delivery on, or subject to the
rules of, a contract market or board of
trade;
``(II) with respect to a foreign
futures commission merchant, a foreign
future;
``(III) with respect to a leverage
transaction merchant, a leverage
transaction;
``(IV) with respect to a clearing
organization, a contract for the
purchase or sale of a commodity for
future delivery on, or subject to the
rules of, a contract market or board of
trade that is cleared by such clearing
organization, or commodity option
traded on, or subject to the rules of,
a contract market or board of trade
that is cleared by such clearing
organization;
``(V) with respect to a commodity
options dealer, a commodity option;
``(VI) any other agreement or
transaction that is similar to any
agreement or transaction referred to in
this clause;
``(VII) any combination of the
agreements or transactions referred to
in this clause;
``(VIII) any option to enter into
any agreement or transaction referred
to in this clause;
``(IX) a master agreement that
provides for an agreement or
transaction referred to in subclause
(I), (II), (III), (IV), (V), (VI),
(VII), or (VIII), together with all
supplements to any such master
agreement, without regard to whether
the master agreement provides for an
agreement or transaction that is not a
commodity contract under this clause,
except that the master agreement shall
be considered to be a commodity
contract under this clause only with
respect to each agreement or
transaction under the master agreement
that is referred to in subclause (I),
(II), (III), (IV), (V), (VI), (VII), or
(VIII); or
``(X) a security agreement or
arrangement or other credit enhancement
related to any agreement or transaction
referred to in this clause.''.
(d) Definition of Forward Contract.--Section 11(e)(8)(D)(iv) of the
Federal Deposit Insurance Act (12 U.S.C. 1821(e)(8)(D)(iv)) is amended
to read as follows:
``(iv) Forward contract.--The term `forward
contract' means--
``(I) a contract (other than a
commodity contract) for the purchase,
sale, or transfer of a commodity or any
similar good, article, service, right,
or interest which is presently or in
the future becomes the subject of
dealing in the forward contract trade,
or product or byproduct thereof, with a
maturity date more than 2 days after
the date the contract is entered into,
including, but not limited to, a
repurchase agreement, reverse
repurchase agreement, consignment,
lease, swap, hedge transaction,
deposit, loan, option, allocated
transaction, unallocated transaction,
or any other similar agreement;
``(II) any combination of
agreements or transactions referred to
in subclauses (I) and (III);
``(III) any option to enter into
any agreement or transaction referred
to in subclause (I) or (II);
``(IV) a master agreement that
provides for an agreement or
transaction referred to in subclauses
(I), (II), or (III), together with all
supplements to any such master
agreement, without regard to whether
the master agreement provides for an
agreement or transaction that is not a
forward contract under this clause,
except that the master agreement shall
be considered to be a forward contract
under this clause only with respect to
each agreement or transaction under the
master agreement that is referred to in
subclause (I), (II), or (III); or
``(V) a security agreement or
arrangement or other credit enhancement
related to any agreement or transaction
referred to in subclause (I), (II),
(III), or (IV).''.
(e) Definition of Repurchase Agreement.--Section 11(e)(8)(D)(v) of
the Federal Deposit Insurance Act (12 U.S.C. 1821(e)(8)(D)(v)) is
amended to read as follows:
``(v) Repurchase agreement.--The term
`repurchase agreement' (which definition also
applies to a reverse repurchase agreement)--
``(I) mean an agreement, including
related terms, which provides for the
transfer of 1 or more certificates of
deposit, mortgage-related securities
(as such term is defined in the
Securities Exchange Act of 1934),
mortgage loans, interests in mortgage-
related securities or mortgage loans,
eligible bankers' acceptances,
qualified foreign government securities
or securities that are direct
obligations of, or that are fully
guaranteed by, the United States or any
agency of the United States against the
transfer of funds by the transferee of
such certificates of deposit, eligible
bankers' acceptances, securities,
loans, or interests with a simultaneous
agreement by such transferee to
transfer to the transferor thereof
certificates of deposit, eligible
bankers' acceptances, securities,
loans, or interests as described above,
at a date certain not later than 1 year
after such transfers or on demand,
against the transfer of funds, or any
other similar agreement;
``(II) does not include any
repurchase obligation under a
participation in a commercial mortgage
loan unless the Corporation determines
by regulation, resolution, or order to
include any such participation within
the meaning of such term;
``(III) means any combination of
agreements or transactions referred to
in subclauses (I) and (IV);
``(IV) means any option to enter
into any agreement or transaction
referred to in subclause (I) or (III);
``(V) means a master agreement that
provides for an agreement or
transaction referred to in subclause
(I), (III), or (IV), together with all
supplements to any such master
agreement, without regard to whether
the master agreement provides for an
agreement or transaction that is not a
repurchase agreement under this clause,
except that the master agreement shall
be considered to be a repurchase
agreement under this subclause only
with respect to each agreement or
transaction under the master agreement
that is referred to in subclause (I),
(III), or (IV); and
``(VI) means a security agreement
or arrangement or other credit
enhancement related to any agreement or
transaction referred to in subclause
(I), (III), (IV), or (V).
For purposes of this clause, the term
`qualified foreign government security' means a
security that is a direct obligation of, or
that is fully guaranteed by, the central
government of a member of the Organization for
Economic Cooperation and Development (as
determined by regulation or order adopted by
the appropriate Federal banking authority).''.
(f) Definition of Swap Agreement.--Section 11(e)(8)(D)(iv) of the
Federal Deposit Insurance Act (12 U.S.C. 1821(e)(8)(D)(vi)) is amended
to read as follows:
``(vi) Swap agreement.--The term `swap
agreement' means--
``(I) any agreement, including the
terms and conditions incorporated by
reference in any such agreement, which
is an interest rate swap, option,
future, or forward agreement, including
a rate floor, rate cap, rate collar,
cross-currency rate swap, and basis
swap; a spot, same day-tomorrow,
tomorrow-next, forward, or other
foreign exchange or precious metals
agreement; a currency swap, option,
future, or forward agreement; an equity
index or equity swap, option, future,
or forward agreement; a debt index or
debt swap, option, future, or forward
agreement; a credit spread or credit
swap, option, future, or forward
agreement; a commodity index or
commodity swap, option, future, or
forward agreement;
``(II) any agreement or transaction
similar to any other agreement or
transaction referred to in this clause
that is presently, or in the future
becomes, regularly entered into in the
swap market (including terms
and conditions incorporated by reference in such agreement) and that is
a forward, swap, future, or option on 1 or more rates, currencies,
commodities, equity securities or other equity instruments, debt
securities or other debt instruments, or economic indices or measures
of economic risk or value;
``(III) any combination of
agreements or transactions referred to
in this clause;
``(IV) any option to enter into any
agreement or transaction referred to in
this clause;
``(V) a master agreement that
provides for an agreement or
transaction referred to in subclause
(I), (II), (III), or (IV), together
with all supplements to any such master
agreement, without regard to whether
the master agreement contains an
agreement or transaction that is not a
swap agreement under this clause,
except that the master agreement shall
be considered to be a swap agreement
under this clause only with respect to
each agreement or transaction under the
master agreement that is referred to in
subclause (I), (II), (III), or (IV);
and
``(VI) any security agreement or
arrangement or other credit enhancement
related to any agreements or
transactions referred to in
subparagraph (I), (II), (III), or (IV).
Such term is applicable for purposes of this
title only and shall not be construed or
applied so as to challenge or affect the
characterization, definition, or treatment of
any swap agreement under any other statute,
regulation, or rule, including the Securities
Act of 1933, the Securities Exchange Act of
1934, the Public Utility Holding Company Act of
1935, the Trust Indenture Act of 1939, the
Investment Company Act of 1940, the Investment
Advisers Act of 1940, the Securities Investor
Protection Act of 1970, the Commodity Exchange
Act, and the regulations promulgated by the
Securities and Exchange Commission or the
Commodity Futures Trading Commission.''.
(g) Definition of Transfer.--Section 11(e)(8)(D)(viii) of the
Federal Deposit Insurance Act (12 U.S.C. 1821(e)(8)(D)(viii)) is
amended to read as follows:
``(viii) Transfer.--The term `transfer'
means every mode, direct or indirect, absolute
or conditional, voluntary or involuntary, of
disposing of or parting with property or with
an interest in property, including retention of
title as a security interest and foreclosure of
the depository institutions's equity of
redemption.''.
(h) Treatment of Qualified Financial Contracts.--Section 11(e)(8)
of the Federal Deposit Insurance Act (12 U.S.C. 1821(e)(8)) is
amended--
(1) in subparagraph (A), by striking ``paragraph (10)'' and
inserting ``paragraphs (9) and (10)'';
(2) in subparagraph (A)(i), by striking ``to cause the
termination or liquidation'' and inserting ``such person has to
cause the termination, liquidation, or acceleration'';
(3) by amending subparagraph (A)(ii) to read as follows:
``(ii) any right under any security
agreement or arrangement or other credit
enhancement related to 1 or more qualified
financial contracts described in clause (i);'';
and
(4) by amending subparagraph (E)(ii) to read as follows:
``(ii) any right under any security
agreement or arrangement or other credit
enhancement related to 1 or more qualified
financial contracts described in clause (i);''.
(i) Avoidance of Transfers.--Section 11(e)(8)(C)(i) of the Federal
Deposit Insurance Act (12 U.S.C. 1821(e)(8)(C)(i)) is amended by
inserting ``section 5242 of the Revised Statutes of the United States
(12 U.S.C. 91) or any other Federal or State law relating to the
avoidance of preferential or fraudulent transfers,'' before ``the
Corporation''.
SEC. 1002. AUTHORITY OF THE CORPORATION WITH RESPECT TO FAILED AND
FAILING INSTITUTIONS.
(a) In General.--Section 11(e)(8) of the Federal Deposit Insurance
Act (12 U.S.C. 1821(e)(8)) is amended--
(1) in subparagraph (E), by striking ``other than paragraph
(12) of this subsection, subsection (d)(9)'' and inserting
``other than subsections (d)(9) and (e)(10)''; and
(2) by adding at the end the following new subparagraphs:
``(F) Clarification.--No provision of law shall be
construed as limiting the right or power of the
Corporation, or authorizing any court or agency to
limit or delay, in any manner, the right or power of
the Corporation to transfer any qualified financial
contract in accordance with paragraphs (9) and (10) of
this subsection or to disaffirm or repudiate any such
contract in accordance with subsection (e)(1) of this
section.
``(G) Walkaway clauses not effective.--
``(i) In general.--Notwithstanding the
provisions of subparagraphs (A) and (E), and
sections 403 and 404 of the Federal Deposit
Insurance Corporation Improvement Act of 1991,
no walkaway clause shall be enforceable in a
qualified financial contract of an insured
depository institution in default.
``(ii) Walkaway clause defined.--For
purposes of this subparagraph, the term
`walkaway clause' means a provision in a
qualified financial contract that, after
calculation of a value of a party's position or
an amount due to or from 1 of the parties in
accordance with its terms upon termination,
liquidation, or acceleration of the qualified
financial contract, either does not create a
payment obligation of a party or extinguishes a
payment obligation of a party in whole or in
part solely because of such party's status as a
nondefaulting party.''.
(b) Technical and Conforming Amendment.--Section 11(e)(12)(A) of
the Federal Deposit Insurance Act (12 U.S.C. 1821(e)(12)(A)) is amended
by inserting ``or the exercise of rights or powers'' after ``the
appointment''.
SEC. 1003. AMENDMENTS RELATING TO TRANSFERS OF QUALIFIED FINANCIAL
CONTRACTS.
(a) Transfers of Qualified Financial Contracts to Financial
Institutions.--Section 11(e)(9) of the Federal Deposit Insurance Act
(12 U.S.C. 1821(e)(9)) is amended to read as follows:
``(9) Transfer of qualified financial contracts.--
``(A) In general.--In making any transfer of assets
or liabilities of a depository institution in default
which includes any qualified financial contract, the
conservator or receiver for such depository institution
shall either--
``(i) transfer to 1 financial institution,
other than a financial institution for which a
conservator, receiver, trustee in bankruptcy,
or other legal custodian has been appointed or
which is otherwise the subject of a bankruptcy
or insolvency proceeding--
``(I) all qualified financial
contracts between any person or any
affiliate of such person and the
depository institution in default;
``(II) all claims of such person or
any affiliate of such person against
such depository institution under any
such contract (other than any claim
which, under the terms of any such
contract, is subordinated to the claims
of general unsecured creditors of such
institution);
``(III) all claims of such
depository institution against such
person or any affiliate of such person
under any such contract; and
``(IV) all property securing or any
other credit enhancement for any
contract described in subclause (I) or
any claim described in subclause (II)
or (III) under any such contract; or
``(ii) transfer none of the qualified
financial contracts, claims, property or other
credit enhancement referred to in clause (i)
(with respect to such person and any affiliate
of such person).
``(B) Transfer to foreign bank, foreign financial
institution, or branch or agency of a foreign bank or
financial institution.--In transferring any qualified
financial contracts and related claims and property
pursuant to subparagraph (A)(i), the conservator or
receiver for such depository institution shall not make
such transfer to a foreign bank, financial institution
organized under the laws of a foreign country, or a
branch or agency of a foreign bank or financial
institution unless, under the law applicable to such
bank, financial institution, branch or agency, to the
qualified financial contracts, and to any netting
contract, any security agreement or arrangement or
other credit enhancement related to 1 or more qualified
financial contracts, the contractual rights of the
parties to such qualified financial contracts, netting
contracts, security agreements or arrangements, or
other credit enhancements are enforceable substantially
to the same extent as permitted under this section.
``(C) Transfer of contracts subject to the rules of
a clearing organization.--In the event that a
conservator or receiver transfers any qualified
financial contract and related claims, property and
credit enhancements pursuant to subparagraph (A)(i) and
such contract is subject to the rules of a clearing
organization, the clearing organization shall not be
required to accept the transferee as a member by virtue
of the transfer.
``(D) Definition.--For purposes of this section,
the term `financial institution' means a broker or
dealer, a depository institution, a futures commission
merchant, or any other institution as determined by the
Corporation by regulation to be a financial
institution.''.
(b) Notice to Qualified Financial Contract Counterparties.--Section
11(e)(10)(A) of the Federal Deposit Insurance Act (12 U.S.C.
1821(e)(10)(A)) is amended by amending the flush material following
clause (ii) to read as follows: ``the conservator or receiver shall
notify any person who is a party to any such contract of such transfer
by 5:00 p.m. (eastern time) on the business day following the date of
the appointment of the receiver, in the case of a receivership, or the
business day following such transfer, in the case of a
conservatorship.''.
(c) Rights Against Receiver and Treatment of Bridge Banks.--Section
11(e)(10) of the Federal Deposit Insurance Act (12 U.S.C. 1821(e)(10))
is further amended--
(1) by redesignating subparagraph (B) as subparagraph (D);
and
(2) by inserting after subparagraph (A) the following new
subparagraphs:
``(B) Certain rights not enforceable.--
``(i) Receivership.--A person who is a
party to a qualified financial contract with an
insured depository institution may not exercise
any right such person has to terminate,
liquidate, or net such contract under paragraph
(8)(A) or section 403 or 404 of the Federal
Deposit Insurance Corporation Improvement Act
of 1991 solely by reason of or incidental to
the appointment of a receiver for the
depository institution (or the insolvency or
financial condition of the depository
institution for which the receiver has been
appointed)--
``(I) until 5:00 p.m. (eastern
time) on the business day following the
date of the appointment of the
receiver; or
``(II) after the person has
received notice that the contract has
been transferred pursuant to paragraph
(9)(A).
``(ii) Conservatorship.--A person who is a
party to a qualified financial contract with an
insured depository institution may not exercise
any right such person has to terminate,
liquidate, or net such contract under paragraph
(8)(E) or sections 403 or 404 of the Federal
Deposit Insurance Corporation Improvement Act
of 1991, solely by reason of or incidental to
the appointment of a conservator for the
depository institution (or the insolvency or
financial condition of the depository
institution for which the conservator has been
appointed).
``(iii) Notice.--For purposes of this
subsection, the Corporation as receiver or
conservator of an insured depository
institution shall be deemed to have notified a
person who is a party to a qualified financial
contract with such depository institution if
the Corporation has taken steps reasonably
calculated to provide notice to such person by
the time specified in subparagraph (A) of this
subsection.
``(C) Treatment of bridge banks.--The following
institutions shall not be considered a financial
institution for which a conservator, receiver, trustee
in bankruptcy, or other legal custodian has been
appointed or which is otherwise the subject of a
bankruptcy or insolvency proceeding for purposes of
subsection (e)(9)--
``(i) a bridge bank; or
``(ii) a depository institution organized
by the Corporation, for which a conservator is
appointed either--
``(I) immediately upon the
organization of the institution; or
``(II) at the time of a purchase
and assumption transaction between such
institution and the Corporation as
receiver for a depository institution
in default.''.
SEC. 1004. AMENDMENTS RELATING TO DISAFFIRMANCE OR REPUDIATION OF
QUALIFIED FINANCIAL CONTRACTS.
Section 11(e) of the Federal Deposit Insurance Act (12 U.S.C.
1821(e)) is further amended--
(1) by redesignating paragraphs (11) through (15) as
paragraphs (12) through (16), respectively; and
(2) by inserting after paragraph (10) the following new
paragraph:
``(11) Disaffirmance or repudiation of qualified financial
contracts.--In exercising the rights of disaffirmance or
repudiation of a conservator or receiver with respect to any
qualified financial contract to which an insured depository
institution is a party, the conservator or receiver for such
institution shall either--
``(A) disaffirm or repudiate all qualified
financial contracts between--
``(i) any person or any affiliate of such
person; and
``(ii) the depository institution in
default; or
``(B) disaffirm or repudiate none of the qualified
financial contracts referred to in subparagraph (A)
(with respect to such person or any affiliate of such
person).''.
SEC. 1005. CLARIFYING AMENDMENT RELATING TO MASTER AGREEMENTS.
Section 11(e)(8)(D)(vii) of the Federal Deposit Insurance Act (12
U.S.C. 1821(e)(8)(D)(vii)) is amended to read as follows:
``(vii) Treatment of master agreement as 1
agreement.--Any master agreement for any
contract or agreement described in any
preceding clause of this subparagraph (or any
master agreement for such master agreement or
agreements), together with all supplements to
such master agreement, shall be treated as a
single agreement and a single qualified
financial contract. If a master agreement
contains provisions relating to agreements or
transactions that are not themselves qualified
financial contracts, the master agreement shall
be deemed to be a qualified financial contract
only with respect to those transactions that are themselves qualified
financial contracts.''.
SEC. 1006. FEDERAL DEPOSIT INSURANCE CORPORATION IMPROVEMENT ACT OF
1991.
(a) Definitions.--Section 402 of the Federal Deposit Insurance
Corporation Improvement Act of 1991 (12 U.S.C. 4402) is amended--
(1) in paragraph (6)--
(A) by redesignating subparagraphs (B) through (D)
as subparagraphs (C) through (E), respectively;
(B) by inserting after subparagraph (A) the
following new subparagraph:
``(B) an uninsured national bank or an uninsured
State bank that is a member of the Federal Reserve
System if the national bank or State member bank is not
eligible to make application to become an insured bank
under section 5 of the Federal Deposit Insurance
Act;''; and
(C) by amending subparagraph (C) (as redesignated)
to read as follows:
``(C) a branch or agency of a foreign bank, a
foreign bank and any branch or agency of the foreign
bank, or the foreign bank that established the branch
or agency, as those terms are defined in section 1(b)
of the International Banking Act of 1978;'';
(2) in paragraph (11), by adding before the period ``and
any other clearing organization with which such clearing
organization has a netting contract'';
(3) by amending paragraph (14)(A)(i) to read as follows:
``(i) means a contract or agreement between
2 or more financial institutions, clearing
organizations, or members that provides for
netting present or future payment obligations
or payment entitlements (including liquidation
or closeout values relating to such obligations
or entitlements) among the parties to the
agreement; and''; and
(4) by adding at the end the following new paragraph:
``(15) Payment.--The term `payment' means a payment of
United States dollars, another currency, or a composite
currency, and a noncash delivery, including a payment or
delivery to liquidate an unmatured obligation.''.
(b) Enforceability of Bilateral Netting Contracts.--Section 403 of
the Federal Deposit Insurance Corporation Improvement Act of 1991 (12
U.S.C. 4403) is amended--
(1) by amending subsection (a) to read as follows:
``(a) General Rule.--Notwithstanding any other provision of State
or Federal law (other than paragraphs (8)(E), (8)(F), and (10)(B) of
section 11(e) of the Federal Deposit Insurance Act or any order
authorized under section 5(b)(2) of the Securities Investor Protection
Act of 1970, the covered contractual payment obligations and the
covered contractual payment entitlements between any 2 financial
institutions shall be netted in accordance with, and subject to the
conditions of, the terms of any applicable netting contract (except as
provided in section 561(b)(2) of title 11).''; and
(2) by adding at the end the following new subsection:
``(f) Enforceability of Security Agreements.--The provisions of any
security agreement or arrangement or other credit enhancement related
to 1 or more netting contracts between any 2 financial institutions
shall be enforceable in accordance with their terms (except as provided
in section 561(b)(2) of title 11) and shall not be stayed, avoided, or
otherwise limited by any State or Federal law (other than paragraphs
(8)(E), (8)(F), and (10)(B) of section 11(e) of the Federal Deposit
Insurance Act and section 5(b)(2) of the Securities Investor Protection
Act of 1970).''.
(c) Enforceability of Clearing Organization Netting Contracts.--
Section 404 of the Federal Deposit Insurance Corporation Improvement
Act of 1991 (12 U.S.C. 4404) is amended--
(1) by amending subsection (a) to read as follows:
``(a) General Rule.--Notwithstanding any other provision of State
or Federal law (other than paragraphs (8)(E), (8)(F), and (10)(B) of
section 11(e) of the Federal Deposit Insurance Act and any order
authorized under section 5(b)(2) of the Securities Investor Protection
Act of 1970, the covered contractual payment obligations and the
covered contractual payment entitlements of a member of a clearing
organization to and from all other members of a clearing organization
shall be netted in accordance with and subject to the conditions of any
applicable netting contract (except as provided in section 561(b)(2) of
title 11, United States Code).''; and
(2) by adding at the end the following new subsection:
``(h) Enforceability of Security Agreements.--The provisions of any
security agreement or arrangement or other credit enhancement related
to 1 or more netting contracts between any 2 members of a clearing
organization shall be enforceable in accordance with their terms
(except as provided in section 561(b)(2) of title 11, United States
Code) and shall not be stayed, avoided, or otherwise limited by any
State or Federal law other than paragraphs (8)(E), (8)(F), and (10)(B)
of section 11(e) of the Federal Deposit Insurance Act and section
5(b)(2) of the Securities Investor Protection Act of 1970.''.
(d) Enforceability of Contracts With Uninsured National Banks and
Uninsured Federal Branches and Agencies.--The Federal Deposit Insurance
Corporation Improvement Act of 1991 (12 U.S.C. 4401 et seq.) is
amended--
(1) by redesignating section 407 as section 408; and
(2) by adding after section 406 the following new section:
``SEC. 407. TREATMENT OF CONTRACTS WITH UNINSURED NATIONAL BANKS AND
UNINSURED FEDERAL BRANCHES AND AGENCIES.
``(a) In General.--Notwithstanding any other provision of law,
paragraphs (8), (9), (10), and (11) of section 11(e) of the Federal
Deposit Insurance Act shall apply to an uninsured national bank or
uninsured Federal branch or Federal agency except--
``(1) any reference to the `Corporation as receiver' or
`the receiver or the Corporation' shall refer to the receiver
of an uninsured national bank or uninsured Federal branch or
Federal agency appointed by the Comptroller of the Currency;
``(2) any reference to the `Corporation' (other than in
section 11(e)(8)(D) of such Act), the `Corporation, whether
acting as such or as conservator or receiver', a `receiver', or
a `conservator' shall refer to the receiver or conservator of
an uninsured national bank or uninsured Federal branch or
Federal agency appointed by the Comptroller of the Currency;
and
``(3) any reference to an `insured depository institution'
or `depository institution' shall refer to an uninsured
national bank or an uninsured Federal branch or Federal agency.
``(b) Liability.--The liability of a receiver or conservator of an
uninsured national bank or uninsured Federal branch or agency shall be
determined in the same manner and subject to the same limitations that
apply to receivers and conservators of insured depository institutions
under section 11(e) of the Federal Deposit Insurance Act.
``(c) Regulatory Authority.--
``(1) In general.--The Comptroller of the Currency, in
consultation with the Federal Deposit Insurance Corporation,
may promulgate regulations to implement this section.
``(2) Specific requirement.--In promulgating regulations to
implement this section, the Comptroller of the Currency shall
ensure that the regulations generally are consistent with the
regulations and policies of the Federal Deposit Insurance
Corporation adopted pursuant to the Federal Deposit Insurance
Act.
``(d) Definitions.--For purposes of this section, the terms
`Federal branch', `Federal agency', and `foreign bank' have the same
meaning as in section 1(b) of the International Banking Act.''.
SEC. 1007. BANKRUPTCY CODE AMENDMENTS.
(a) Definitions of Forward Contract, Repurchase Agreement,
Securities Clearing Agency, Swap Agreement, Commodity Contract, and
Securities Contract.--Title 11, United States Code, is amended--
(1) in section 101--
(A) in paragraph (25)--
(i) by striking ``means a contract'' and
inserting ``means--
``(A) a contract'';
(ii) by striking ``, or any combination
thereof or option thereon;'' and inserting ``,
or any other similar agreement;''; and
(iii) by adding at the end the following:
``(B) any combination of agreements or transactions
referred to in subparagraphs (A) and (C);
``(C) any option to enter into an agreement or
transaction referred to in subparagraph (A) or (B);
``(D) a master agreement that provides for an
agreement or transaction referred to in subparagraph
(A), (B), or (C), together with all supplements to any
such master agreement, without regard to whether such
master agreement provides for an agreement or
transaction that is not a forward contract under this
paragraph, except that such master agreement shall be
considered to be a forward contract under this
paragraph only with respect to each agreement or
transaction under such master agreement that is
referred to in subparagraph (A), (B) or (C); or
``(E) a security agreement or arrangement, or other
credit enhancement related to any agreement or
transaction referred to in subparagraph (A), (B), (C),
or (D), but not to exceed the actual value of such
contract, option, agreement, or transaction on the date
of the filing of the petition;'';
(B) in paragraph (46), by striking ``on any day
during the period beginning 90 days before the date
of'' and replacing it with ``at any time before'';
(C) by amending paragraph (47) to read as follows:
``(47) `repurchase agreement' (which definition also
applies to a reverse repurchase agreement) means--
``(i) an agreement, including related
terms, which provides for the transfer of 1 or
more certificates of deposit, mortgage-related
securities (as defined in the Securities
Exchange Act of 1934), mortgage loans,
interests in mortgage-related securities or
mortgage loans, eligible bankers' acceptances,
qualified foreign government securities; or
securities that are direct obligations of, or
that are fully guaranteed by, the United States
or any agency of the United States against the
transfer of funds by the transferee of such
certificates of deposit, eligible bankers'
acceptances, securities, loans, or interests;
with a simultaneous agreement by such
transferee to transfer to the transferor
thereof certificates of deposit, eligible
bankers' acceptance, securities, loans, or
interests of the kind described above, at a
date certain not later than 1 year after such
transfer or on demand, against the transfer of
funds;
``(ii) any combination of agreements or
transactions referred to in clauses (i) and
(iii);
``(iii) an option to enter into an
agreement or transaction referred to in clause
(i) or (ii);
``(iv) a master agreement that provides for
an agreement or transaction referred to in
clause (i), (ii), or (iii), together with all
supplements to any such master agreement,
without regard to whether such master agreement provides for an
agreement or transaction that is not a repurchase agreement under this
paragraph, except that such master agreement shall be considered to be
a repurchase agreement under this paragraph only with respect to each
agreement or transaction under the master agreement that is referred to
in clause (i), (ii), or (iii); or
``(v) a security agreement or arrangement
or other credit enhancement related to any
agreement or transaction referred to in clause
(i), (ii), (iii), or (iv), but not to exceed
the actual value of such contract on the date
of the filing of the petition; and
``(B) does not include a repurchase obligation
under a participation in a commercial mortgage loan;
and, for purposes of this paragraph, the term `qualified
foreign government security' means a security that is a direct
obligation of, or that is fully guaranteed by, the central
government of a member of the Organization for Economic
Cooperation and Development;'';
(D) in paragraph (48) by inserting ``or exempt from
such registration under such section pursuant to an
order of the Securities and Exchange Commission'' after
``1934''; and
(E) by amending paragraph (53B) to read as follows:
``(53B) `swap agreement'
``(A) means--
``(i) any agreement, including the terms
and conditions incorporated by reference in
such agreement, which is an interest rate swap,
option, future, or forward agreement, including
a rate floor, rate cap, rate collar, cross-
currency rate swap, and basis swap; a spot,
same day-tomorrow, tomorrow-next, forward, or
other foreign exchange or precious metals
agreement; a currency swap, option, future, or
forward agreement; an equity index or an equity
swap, option, future, or forward agreement; a
debt index or a debt swap, option, future, or
forward agreement; a credit spread or a credit
swap, option, future, or forward agreement; or
a commodity index or a commodity swap, option,
future, or forward agreement;
``(ii) any agreement or transaction similar
to any other agreement or transaction referred
to in this paragraph that--
``(I) is presently, or in the
future becomes, regularly entered into
in the swap market (including terms and
conditions incorporated by reference
therein); and
``(II) is a forward, swap, future,
or option on 1 or more rates,
currencies commodities, equity
securities, or other equity
instruments, debt securities or other
debt instruments, or on an economic
index or measure of economic risk or
value;
``(iii) any combination of agreements or
transactions referred to in this paragraph;
``(iv) any option to enter into an
agreement or transaction referred to in this
paragraph;
``(v) a master agreement that provides for
an agreement or transaction referred to in
clause (i), (ii), (iii), or (iv), together with
all supplements to any such master agreement,
and without regard to whether the master
agreement contains an agreement or transaction
that is not a swap agreement under this
paragraph, except that the master agreement
shall be considered to be a swap agreement
under this paragraph only with respect to each
agreement or transaction under the master
agreement that is referred to in clause (i),
(ii), (iii), or (iv); or
``(B) any security agreement or arrangement or
other credit enhancement related to any agreements or
transactions referred to in subparagraph (A); and
``(C) is applicable for purposes of this title only
and shall not be construed or applied so as to
challenge or affect the characterization, definition,
or treatment of any swap agreement under any other
statute, regulation, or rule, including the Securities
Act of 1933, the Securities Exchange Act of 1934, the
Public Utility Holding Company Act of 1935, the Trust
Indenture Act of 1939, the Investment Company Act of
1940, the Investment Advisers Act of 1940, the
Securities Investor Protection Act of 1970, the
Commodity Exchange Act, and the regulations prescribed
by the Securities and Exchange Commission or the
Commodity Futures Trading Commission.'';
(2) by amending section 741(7) to read as follows:
``(7) `securities contract'--
``(A) means--
``(i) a contract for the purchase, sale, or
loan of a security, a certificate of deposit, a
mortgage loan or any interest in a mortgage
loan, a group or index of securities,
certificates of deposit or mortgage loans or
interests therein (including an interest
therein or based on the value thereof), or
option on any of the foregoing, including an
option to purchase or sell any such security
certificate of deposit, loan, interest, group
or index or option;
``(ii) any option entered into on a
national securities exchange relating to
foreign currencies;
``(iii) the guarantee by or to any
securities clearing agency of a settlement of
cash, securities, certificates of deposit
mortgage loans or interests therein, group or
index of securities, or mortgage loans or
interests therein (including any interest
therein or based on the value thereof), or
option on any of the foregoing, including an
option to purchase or sell any such security
certificate of deposit, loan, interest, group
or index or option;
``(iv) any margin loan;
``(v) any other agreement or transaction
that is similar to an agreement or transaction
referred to in this paragraph;
``(vi) any combination of the agreements or
transactions referred to in this paragraph;
``(vii) any option to enter into any
agreement or transaction referred to in this
paragraph;
``(viii) a master agreement that provides
for an agreement or transaction referred to in
clause (i), (ii), (iii), (iv), (v), (vi), or
(vii), together with all supplements to any
such master agreement, without regard to
whether the master agreement provides for an
agreement or transaction that is not a
securities contract under this paragraph,
except that such master agreement shall be
considered to be a securities contract under this paragraph only with
respect to each agreement or transaction under such master agreement
that is referred to in clause (i), (ii), (iii), (iv), (v), (vi), or
(vii); or
``(ix) any security agreement or
arrangement, or other credit enhancement,
related to any agreement or transaction
referred to in this paragraph, but not to
exceed the actual value of such contract on the
date of the filing of the petition; and
``(B) does not include any purchase, sale, or
repurchase obligation under a participation in a
commercial mortgage loan.''; and
(3) in section 761(4)--
(A) by striking ``or'' at the end of subparagraph
(D); and
(B) by adding at the end the following:
``(F) any other agreement or transaction that is
similar to an agreement or transaction referred to in
this paragraph;
``(G) any combination of the agreements or
transactions referred to in this paragraph;
``(H) any option to enter into an agreement or
transaction referred to in this paragraph;
``(I) a master agreement that provides for an
agreement or transaction referred to in subparagraph
(A), (B), (C), (D), (E), (F), (G), or (H), together
with all supplements to such master netting agreement,
without regard to whether the master netting agreement
provides for an agreement or transaction that is not a
commodity contract under this paragraph, except that
the master agreement shall be considered to be a
commodity contract under this paragraph only with
respect to each agreement or transaction under the
master agreement that is referred to in subparagraph
(A), (B), (C), (D), (E), (F), (G), or (H); or
``(J) a security agreement or arrangement, or other
credit enhancement related to any agreement or
transaction referred to in this paragraph, but not to
exceed the actual value of such contract on the date of
the filing of the petition;''.
(b) Definitions of Financial Institution, Financial Participant,
and Forward Contract Merchant.--Section 101 of title 11, United States
Code, is amended--
(1) by amending paragraph (22) to read as follows:
``(22) `financial institution' means--
``(A) a Federal reserve bank, or an entity
(domestic or foreign) that is a commercial or savings
bank, industrial savings bank, savings and loan
association, trust company, or receiver or conservator
for such entity and, when any such Federal reserve
bank, receiver, conservator or entity is acting as
agent or custodian for a customer in connection with a
securities contract, as defined in section 741 of this
title, such customer; or
``(B) in connection with a securities contract, as
defined in section 741 of this title, an investment
company registered under the Investment Company Act of
1940;'';
(2) by inserting after paragraph (22) the following:
``(22A) `financial participant' means an entity that, at
the time it enters into a securities contract, commodity
contract or forward contract, or at the time of the filing of
the petition, has 1 or more agreements or transactions that is
described in section 561(a)(2) with the debtor or any other
entity (other than an affiliate) of a total gross dollar value
of at least $1,000,000,000 in notional or actual principal
amount outstanding on any day during the previous 15-month
period, or has gross mark-to-market positions of at least
$100,000,000 (aggregated across counterparties) in 1 or more
such agreement or transaction with the debtor or any other
entity (other than an affiliate) on any day during the previous
15-month period;''; and
(3) by amending paragraph (26) to read as follows:
``(26) `forward contract merchant' means a Federal reserve
bank, or an entity whose business consists in whole or in part
of entering into forward contracts as or with merchants or in a
commodity, as defined or in section 761 of this title, or any
similar good, article, service, right, or interest which is
presently or in the future becomes the subject of dealing or in
the forward contract trade;''.
(c) Definition of Master Netting Agreement and Master Netting
Agreement Participant.--Section 101 of title 11, United States Code, is
amended by inserting after paragraph (38) the following new paragraphs:
``(38A) `master netting agreement' means an agreement
providing for the exercise of rights, including rights of
netting, setoff, liquidation, termination, acceleration, or
closeout, under or in connection with 1 or more contracts that
are described in any 1 or more of paragraphs (1) through (5) of
section 561(a), or any security agreement or arrangement or
other credit enhancement related to 1 or more of the foregoing.
If a master netting agreement contains provisions relating to
agreements or transactions that are not contracts described in
paragraphs (1) through (5) of section 561(a), the master
netting agreement shall be deemed to be a master netting
agreement only with respect to those agreements or transactions
that are described in any 1 or more of the paragraphs (1)
through (5) of section 561(a);
``(38B) `master netting agreement participant' means an
entity that, at any time before the filing of the petition, is
a party to an outstanding master netting agreement with the
debtor;''.
(d) Swap Agreements, Securities Contracts, Commodity Contracts,
Forward Contracts, Repurchase Agreements, and Master Netting Agreements
Under the Automatic-Stay.--
(1) In general.--Section 362(b) of title 11, United States
Code, as amended by sections 118, 132, 136, 142, 203 and 818,
is amended--
(A) in paragraph (6), by inserting ``, pledged to,
and under the control of,'' after ``held by'';
(B) in paragraph (7), by inserting ``, pledged to,
and under the control of,'' after ``held by'';
(C) by amending paragraph (17) to read as follows:
``(17) under subsection (a), of the setoff by a swap
participant of a mutual debt and claim under or in connection
with 1 or more swap agreements that constitutes the setoff of a
claim against the debtor for any payment or other transfer of
property due from the debtor under or in connection with any
swap agreement against any payment due to the debtor from the
swap participant under or in connection with any swap agreement
or against cash, securities, or other property held by, pledged
to, and under the control of, or due from such swap participant
to margin guarantee, secure, or settle a swap agreement;'';
(D) in paragraph (30) by striking ``or'' at the
end;
(E) in paragraph (31) by striking the period at the
end and inserting ``; or''; and
(F) by inserting after paragraph (31) the following
new paragraph:
``(32) under subsection (a), of the setoff by a master
netting agreement participant of a mutual debt and claim under
or in connection with 1 or more master netting agreements or
any contract or agreement subject to such agreements that
constitutes the setoff of a claim against the debtor for any
payment or other transfer of property due from the debtor under
or in connection with such agreements or any contract or
agreement subject to such agreements against any payment due to
the debtor from such master netting agreement participant under
or in connection with such agreements or any contract or
agreement subject to such agreements or against cash,
securities, or other property held by, pledged or and under the
control of, or due from such master netting agreement
participant to margin, guarantee, secure, or settle such
agreements or any contract or agreement subject to such
agreements, to the extent such participant is eligible to
exercise such offset rights under paragraph (6), (7), or (17)
for each individual contract covered by the master netting
agreement in issue.''.
(2) Limitation.--Section 362 of title 11, United States
Code, as amended by sections 120, 302, and 412, is amended by
adding at the end the following:
``(l) Limitation.--The exercise of rights not subject to the stay
arising under subsection (a) pursuant to paragraph (6), (7), or (17),
or (31) of subsection (b) shall not be stayed by any order of a court
or administrative agency in any proceeding under this title.''.
(e) Limitation of Avoidance Powers Under Master Netting
Agreement.--Section 546 of title 11, United States Code, as amended by
sections 207 and 302, is amended--
(1) in subsection (g) (as added by section 103 of Public
Law 101-311)--
(A) by striking ``under a swap agreement'';
(B) by striking ``in connection with a swap
agreement'' and inserting ``under or in connection with
any swap agreement''; and
(2) by adding at the end the following:
``(j) Notwithstanding sections 544, 545, 547, 548(a)(2)(B), and
548(b) of this title, the trustee may not avoid a transfer made by or
to a master netting agreement participant under or in connection with
any master netting agreement or any individual contract covered thereby
that is made before the commencement of the case, except under section
548(a)(1)(A) of this title, and except to the extent the trustee could
otherwise avoid such a transfer made under an individual contract
covered by such master netting agreement.''.
(f) Fraudulent Transfers of Master Netting Agreements.--Section
548(d)(2) of title 11, United States Code, is amended--
(1) in subparagraph (C), by striking ``and'';
(2) in subparagraph (D), by striking the period and
inserting ``; and''; and
(3) by adding at the end the following new subparagraph:
``(E) a master netting agreement participant that receives
a transfer in connection with a master netting agreement or any
individual contract covered thereby takes for value to the
extent of such transfer, except, with respect to a transfer
under any individual contract covered thereby, to the extent
such master netting agreement participant otherwise did not
take (or is otherwise not deemed to have taken) such transfer
for value.''.
(g) Termination or Acceleration of Securities Contracts.--Section
555 of title 11, United States Code, is amended--
(1) by amending the section heading to read as follows:
``Sec. 555. Contractual right to liquidate, terminate, or accelerate a
securities contract''; and
(2) in the first sentence, by striking ``liquidation'' and
inserting ``liquidation, termination, or acceleration''.
(h) Termination or Acceleration of Commodities or Forward
Contracts.--Section 556 of title 11, United States Code, is amended--
(1) by amending the section heading to read as follows:
``Sec. 556. Contractual right to liquidate, terminate, or accelerate a
commodities contract or forward contract''; and
(2) in the first sentence, by striking ``liquidation'' and
inserting ``liquidation, termination, or acceleration''.
(i) Termination or Acceleration of Repurchase Agreements.--Section
559 of title 11, United States Code, is amended--
(1) by amending the section heading to read as follows:
``Sec. 559. Contractual right to liquidate, terminate, or accelerate a
repurchase agreement''; and
(2) in the first sentence, by striking ``liquidation'' and
inserting ``liquidation, termination, or acceleration''.
(j) Liquidation, Termination, or Acceleration of Swap Agreements.--
Section 560 of title 11, United States Code, is amended--
(1) by amending the section heading to read as follows:
``Sec. 560. Contractual right to liquidate, terminate, or accelerate a
swap agreement''; and
(2) in the first sentence, by striking ``termination of a
swap agreement'' and inserting ``liquidation, termination, or
acceleration of 1 or more swap agreements''; and
(3) by striking ``in connection with any swap agreement''
and inserting ``in connection with the termination,
liquidation, or acceleration of 1 or more swap agreements''.
(k) Liquidation, Termination, Acceleration, or Offset Under a
Master Netting Agreement and Across Contracts.--(1) Title 11, United
States Code, is amended by inserting after section 560 the following:
``Sec. 561. Contractual right to terminate, liquidate, accelerate, or
offset under a master netting agreement and across
contracts
``(a) In General.--Subject to subsection (b), the exercise of any
contractual right, because of a condition of the kind specified in
section 365(e)(1), to cause the termination, liquidation, or
acceleration of or to offset or net termination values, payment amounts
or other transfer obligations arising under or in connection with 1 or
more (or the termination, liquidation, or acceleration of 1 or more)--
``(1) securities contracts, as defined in section 741(7);
``(2) commodity contracts, as defined in section 761(4);
``(3) forward contracts;
``(4) repurchase agreements;
``(5) swap agreements; or
``(6) master netting agreements,
shall not be stayed, avoided, or otherwise limited by operation of any
provision of this title or by any order of a court or administrative
agency in any proceeding under this title.
``(b) Exception.--
``(1) A party may exercise a contractual right described in
subsection (a) to terminate, liquidate, or accelerate only to
the extent that such party could exercise such a right under
section 555, 556, 559, or 560 for each individual contract
covered by the master netting agreement in issue.
``(2) If a debtor is a commodity broker subject to
subchapter IV of chapter 7 of this title--
``(A) a party may not net or offset an obligation
to the debtor arising under, or in connection with, a
commodity contract against any claim arising under, or
in connection with, other instruments, contracts, or
agreements listed in subsection (a) except to the
extent the party has positive net equity in the
commodity accounts at the debtor, as calculated under
subchapter IV; and
``(B) another commodity broker may not net or
offset an obligation to the debtor arising under, or in
connection with, a commodity contract entered into or
held on behalf of a customer of the debtor against any
claim arising under, or in connection with, other
instruments, contracts, or agreements listed in
subsection (a).
``(c) Definition.--As used in this section, the term `contractual
right' includes a right set forth in a rule or bylaw of a national
securities exchange, a national securities association, or a securities
clearing agency, a right set forth in a bylaw of a clearing
organization or contract market or in a resolution of the governing
board thereof, and a right, whether or not evidenced in writing,
arising under common law, under law merchant, or by reason of normal
business practice.''.
(2) Conforming amendment.--The table of sections of chapter 9 of
title 11, United States Code, is amended by inserting after the item
relating to section 560 the following:
``561. Contractual right to terminate, liquidate, accelerate, or offset
under a master netting agreement and across
contracts.
(l) Ancillary Proceedings.--Section 304 of title 11, United States
Code, as amended by section 215, is amended by adding at the end the
following:
``(c) Any provisions of this title relating to securities
contracts, commodity contracts, forward contracts, repurchase
agreements, swap agreements, or master netting agreements shall apply
in a case ancillary to a foreign proceeding under this section or any
other section of this title, so that enforcement of contractual
provisions of such contracts and agreements in accordance with their
terms will not be stayed or otherwise limited by operation of any
provision of this title or by order of a court in any case under this
title, and to limit avoidance powers to the same extent as in a
proceeding under chapter 7 or 11 of this title (such enforcement not to
be limited based on the presence or absence of assets of the debtor in
the United States).''.
(m) Commodity Broker Liquidations.--Title 11, United States Code,
is amended by inserting after section 766 the following:
``Sec. 767. Commodity broker liquidation and forward contract
merchants, commodity brokers, stockbrokers, financial
institutions, securities clearing agencies, swap
participants, repo participants, and master netting
agreement participants
``Notwithstanding any other provision of this title, the exercise
of rights by a forward contract merchant, commodity broker,
stockbroker, financial institution, securities clearing agency, swap
participant, repo participant, or master netting agreement participant
under this title shall not affect the priority of any unsecured claim
it may have after the exercise of such rights.''.
(n) Stockbroker Liquidations.--Title 11, United States Code, is
amended by inserting after section 752 the following:
``Sec. 753. Stockbroker liquidation and forward contract merchants,
commodity brokers, stockbrokers, financial institutions,
securities clearing agencies, swap participants, repo
participants, and master netting agreement participants
``Notwithstanding any other provision of this title, the exercise
of rights by a forward contract merchant, commodity broker,
stockbroker, financial institution, securities clearing agency, swap
participant, repo participant, financial participant, or master netting
agreement participant under this title shall not affect the priority of
any unsecured claim it may have after the exercise of such rights.''.
(o) Setoff.--Section 553 of title 11, United States Code, is
amended--
(1) in subsection (a)(3)(C), by inserting ``(except for a
setoff of a kind described in section 362(b)(6), 362(b)(7),
362(b)(17), 362(b)(19), 555, 556, 559, 560 or 561 of this
title)'' before the period; and
(2) in subsection (b)(1), by striking ``362(b)(14),'' and
inserting ``362(b)(17), 362(b)(19), 555, 556, 559, 560, 561''.
(p) Securities Contracts, Commodity Contracts, and Forward
Contracts.--Title 11, United States Code, is amended--
(1) in section 362(b)(6), by striking ``financial
institutions,'' each place such term appears and inserting
``financial institution, financial participant'';
(2) in section 546(e), by inserting ``financial
participant,'' after ``financial institution,'';
(3) in section 548(d)(2)(B), by inserting ``financial
participant,'' after ``financial institution,'';
(4) in section 555--
(A) by inserting ``financial participant,'' after
``financial institution,''; and
(B) by inserting before the period at the end ``, a
right set forth in a bylaw of a clearing organization
or contract market or in a resolution of the governing
board thereof, and a right, whether or not in writing,
arising under common law, under law merchant, or by
reason of normal business practice''; and
(5) in section 556, by inserting ``, financial
participant'' after ``commodity broker''.
(q) Conforming Amendments.--Title 11 of the United States Code is
amended--
(1) in the table of sections of chapter 5--
(A) by amending the items relating to sections 555
and 556 to read as follows:
``555. Contractual right to liquidate, terminate, or accelerate a
securities contract.
``556. Contractual right to liquidate, terminate, or accelerate a
commodities contract or forward
contract.''; and
(B) by amending the items relating to sections 559
and 560 to read as follows:
``559. Contractual right to liquidate, terminate, or accelerate a
repurchase agreement.
``560. Contractual right to liquidate, terminate, or accelerate a swap
agreement.''; and
(2) in the table of sections of chapter 7--
(A) by inserting after the item relating to section
766 the following:
``767. Commodity broker liquidation and forward contract merchants,
commodity brokers, stockbrokers, financial
institutions, securities clearing agencies,
swap participants, repo participants, and
master netting agreement participants.'';
and
(B) by inserting after the item relating to section
752 the following:
``753. Stockbroker liquidation and forward contract merchants,
commodity brokers, stockbrokers, financial
institutions, securities clearing agencies,
swap participants, repo participants, and
master netting agreement participants.''.
SEC. 1008. RECORDKEEPING REQUIREMENTS.
Section 11(e)(8) of the Federal Deposit Insurance Act (12 U.S.C.
1821(e)(8)) is amended by adding at the end the following new
subparagraph:
``(H) Recordkeeping requirements.--The Corporation,
in consultation with the appropriate Federal banking
agencies, may prescribe regulations requiring more
detailed recordkeeping with respect to qualified
financial contracts (including market valuations) by
insured depository institutions.''.
SEC. 1009. EXEMPTIONS FROM CONTEMPORANEOUS EXECUTION ---REQUIREMENT.
Section 13(e)(2) of the Federal Deposit Insurance Act (12 U.S.C.
1823(e)(2)) is amended to read as follows:
``(2) Exemptions from contemporaneous execution
requirement.--An agreement to provide for the lawful
collateralization of--
``(A) deposits of, or other credit extension by, a
Federal, State, or local governmental entity, or of any
depositor referred to in section 11(a)(2), including an
agreement to provide collateral in lieu of a surety
bond;
``(B) bankruptcy estate funds pursuant to section
345(b)(2) of title 11, United States Code;
``(C) extensions of credit, including any
overdraft, from a Federal reserve bank or Federal home
loan bank; or
``(D) 1 or more qualified financial contracts, as
defined in section 11(e)(8)(D),
shall not be deemed invalid pursuant to paragraph (1)(B) solely
because such agreement was not executed contemporaneously with
the acquisition of the collateral or because of pledges,
delivery, or substitution of the collateral made in accordance
with such agreement.''.
SEC. 1010. DAMAGE MEASURE.
(a) Title 11, United States Code, as amended by section 1007, is
amended--
(1) by inserting after section 561 the following:
``Sec. 562. Damage measure in connection with swap agreements,
securities contracts, forward contracts, commodity
contracts, repurchase agreements, or master netting
agreements
``If the trustee rejects a swap agreement, securities contract as
defined in section 741 of this title, forward contract, commodity
contract (as defined in section 761 of this title) repurchase
agreement, or master netting agreement pursuant to section 365(a) of
this title, or if a forward contract merchant, stockbroker, financial
institution, securities clearing agency, repo participant, financial
participant, master netting agreement participant, or swap participant
liquidates, terminates, or accelerates such contract or agreement,
damages shall be measured as of the earlier of--
``(1) the date of such rejection; or
``(2) the date of such liquidation, termination, or
acceleration.''; and
(2) in the table of sections of chapter 5 by inserting
after the item relating to section 561 the following:
``562. Damage measure in connection with swap agreements, securities
contracts, forward contracts, commodity
contracts, repurchase agreements, or master
netting agreements.''.
(b) Claims Arising From Rejection.--Section 502(g) of title 11,
United States Code, is amended--
(1) by designating the existing text as paragraph (1); and
(2) by adding at the end the following:
``(2) A claim for damages calculated in accordance with section 561
of this title shall be allowed under subsection (a), (b), or (c), or
disallowed under subsection (d) or (e), as if such claim had arisen
before the date of the filing of the petition.''.
SEC. 1011. SIPC STAY.
Section 5(b)(2) of the Securities Investor Protection Act of 1970
(15 U.S.C. 78eee(b)(2)) is amended by adding after subparagraph (B) the
following new subparagraph:
``(C) Exception from stay.--
``(i) Notwithstanding section 362 of title
11, United States Code, neither the filing of
an application under subsection (a)(3) nor any
order or decree obtained by Securities Investor
Protection Corporation from the court shall
operate as a stay of any contractual rights of
a creditor to liquidate, terminate, or
accelerate a securities contract, commodity
contract, forward contract, repurchase
agreement, swap agreement, or master netting
agreement, each as defined in title 11, to
offset or net termination values, payment
amounts, or other transfer obligations arising
under or in connection with 1 or more of such
contracts or agreements, or to foreclose on any
cash collateral pledged by the debtor whether
or not with respect to 1 or more of such
contracts or agreements.
``(ii) Notwithstanding clause (i), such
application, order, or decree may operate as a
stay of the foreclosure on securities
collateral pledged by the debtor, whether or
not with respect to 1 or more of such contracts
or agreements, securities sold by the debtor
under a repurchase agreement or securities lent
under a securities lending agreement.
``(iii) As used in this section, the term
`contractual right' includes a right set forth
in a rule or bylaw of a national securities
exchange, a national securities association, or
a securities clearing agency, a right set forth
in a bylaw of a clearing organization or
contract market or in a resolution of the
governing board thereof, and a right, whether
or not in writing, arising under common law,
under law merchant, or by reason of normal
business practice.''.
SEC. 1012. ASSET-BACKED SECURITIZATIONS.
Section 541 of title 11, United States Code, as amended by section
150, is amended--
(1) by redesignating paragraph (5) of subsection (b) as
paragraph (6);
(2) by inserting after paragraph (4) of subsection (b) the
following new paragraph:
``(5) any eligible asset (or proceeds thereof), to the
extent that such eligible asset was transferred by the debtor,
before the date of commencement of the case, to an eligible
entity in connection with an asset-backed securitization,
except to the extent such asset (or proceeds or value thereof)
may be recovered by the trustee under section 550 by virtue of
avoidance under section 548(a);''; and
(3) by adding at the end the following new subsection:
``(e) For purposes of this section, the following definitions shall
apply:
``(1) the term `asset-backed securitization' means a
transaction in which eligible assets transferred to an eligible
entity are used as the source of payment on securities, the
most senior of which are rated investment grade by 1 or more
nationally recognized securities rating organizations, issued
by an issuer;
``(2) the term `eligible asset' means--
``(A) financial assets (including interests therein
and proceeds thereof), either fixed or revolving,
including residential and commercial mortgage loans,
consumer receivables, trade receivables, and lease
receivables, that, by their terms, convert into cash
within a finite time period, plus any residual interest
in property subject to receivables included in such
financial assets plus any rights or other assets
designed to assure the servicing or timely distribution
of proceeds to security holders;
``(B) cash; and
``(C) securities.
``(3) the term `eligible entity' means--
``(A) an issuer; or
``(B) a trust, corporation, partnership, or other
entity engaged exclusively in the business of acquiring
and transferring eligible assets directly or indirectly
to an issuer and taking actions ancillary thereto;
``(4) the term `issuer' means a trust, corporation,
partnership, or other entity engaged exclusively in the
business of acquiring and holding eligible assets, issuing
securities backed by eligible assets, and taking actions
ancillary thereto; and
``(5) the term `transferred' means the debtor, pursuant to
a written agreement, represented and warranted that eligible
assets were sold, contributed, or otherwise conveyed with the
intention of removing them from the estate of the debtor
pursuant to subsection (b)(5), irrespective, without limitation
of--
``(A) whether the debtor directly or indirectly
obtained or held an interest in the issuer or in any
securities issued by the issuer;
``(B) whether the debtor had an obligation to
repurchase or to service or supervise the servicing of
all or any portion of such eligible assets; or
``(C) the characterization of such sale,
contribution, or other conveyance for tax, accounting,
regulatory reporting, or other purposes.''.
SEC. 1013. FEDERAL RESERVE COLLATERAL REQUIREMENTS.
The 3d sentence of the 3d undesignated paragraph of section 16 of
the Federal Reserve Act (12 U.S.C. 412) is amended by striking
``acceptances acquired under the provisions of section 13 of this Act''
and inserting ``acceptances acquired under section 10A, 10B, 13, or 13A
of this Act''.
SEC. 1014. EFFECTIVE DATE; APPLICATION OF ---AMENDMENTS.
(a) Effective Date.--This title shall take effect on the date of
the enactment of this Act.
(b) Application of Amendments.--The amendments made by this title
shall apply with respect to cases commenced or appointments made under
any Federal or State law after the date of enactment of this Act, but
shall not apply with respect to cases commenced or appointments made
under any Federal or State law before the date of enactment of this
Act.
TITLE XI--TECHNICAL CORRECTIONS
SEC. 1101. DEFINITIONS.
Section 101 of title 11, United States Code, as amended by sections
102, 105, 132, 138, 301, 302, 402, 902, and 1007, is amended--
(1) by striking ``In this title--'' and inserting ``In this
title:'';
(2) in each paragraph, by inserting ``The term'' after the
paragraph designation;
(3) in paragraph (35)(B), by striking ``paragraphs (21B)
and (33)(A)'' and inserting ``paragraphs (23) and (35)'';
(4) in each of paragraphs (35A) and (38), by striking ``;
and'' at the end and inserting a period;
(5) in paragraph (51B)--
(A) by inserting ``who is not a family farmer''
after ``debtor'' the first place it appears; and
(B) by striking ``thereto having aggregate'' and
all that follows through the end of the paragraph;
(6) by amending paragraph (54) to read as follows:
``(54) The term `transfer' means--
``(A) the creation of a lien;
``(B) the retention of title as a security
interest;
``(C) the foreclosure of a debtor's equity of
redemption; or
``(D) each mode, direct or indirect, absolute or
conditional, voluntary or involuntary, of disposing of
or parting with--
``(i) property; or
``(ii) an interest in property;'';
(7) in each of paragraphs (1) through (35), in each of
paragraphs (36) and (37), and in each of paragraphs (40)
through (55) (including paragraph (54), as amended by paragraph
(6) of this section), by striking the semicolon at the end and
inserting a period; and
(8) by redesignating paragraphs (4) through (55), including
paragraph (54), as amended by paragraph (6) of this section, in
entirely numerical sequence.
SEC. 1102. ADJUSTMENT OF DOLLAR AMOUNTS.
Section 104 of title 11, United States Code, is amended by
inserting ``522(f)(3), 707(b)(5),'' after ``522(d),'' each place it
appears.
SEC. 1103. EXTENSION OF TIME.
Section 108(c)(2) of title 11, United States Code, is amended by
striking ``922'' and all that follows through ``or'', and inserting
``922, 1201, or''.
SEC. 1104. TECHNICAL AMENDMENTS.
Title 11 of the United States Code is amended--
(1) in section 109(b)(2) by striking ``subsection (c) or
(d) of''; and
(2) in section 552(b)(1) by striking ``product'' each place
it appears and inserting ``products''.
SEC. 1105. PENALTY FOR PERSONS WHO NEGLIGENTLY OR FRAUDULENTLY PREPARE
BANKRUPTCY PETITIONS.
Section 110(j)(3) of title 11, United States Code, is amended by
striking ``attorney's'' and inserting ``attorneys' ''.
SEC. 1106. LIMITATION ON COMPENSATION OF PROFESSIONAL PERSONS.
Section 328(a) of title 11, United States Code, is amended by
inserting ``on a fixed or percentage fee basis,'' after ``hourly
basis,''.
SEC. 1107. SPECIAL TAX PROVISIONS.
Section 346(g)(1)(C) of title 11, United States Code, is amended by
striking ``, except'' and all that follows through ``1986''.
SEC. 1108. EFFECT OF CONVERSION.
Section 348(f)(2) of title 11, United States Code, is amended by
inserting ``of the estate'' after ``property'' the first place it
appears.
SEC. 1109. ALLOWANCE OF ADMINISTRATIVE EXPENSES.
Section 503(b)(4) of title 11, United States Code, is amended by
inserting ``subparagraph (A), (B), (C), (D), or (E) of'' before
``paragraph (3)''.
SEC. 1110. PRIORITIES.
Section 507(a) of title 11, United States Code, as amended by
section 323, is amended in paragraph (4), as so redesignated by section
142, by striking the semicolon at the end and inserting a period.
SEC. 1111. EXEMPTIONS.
Section 522(g)(2) of title 11, United States Code, is amended by
striking ``subsection (f)(2)'' and inserting ``subsection (f)(1)(B)''.
SEC. 1112. EXCEPTIONS TO DISCHARGE.
Section 523 of title 11, United States Code, as amended by section
146, is amended--
(1) in subsection (a)(3), by striking ``or (6)'' each place
it appears and inserting ``(6), or (15)'';
(2) as amended by section 304(e) of Public Law 103-394 (108
Stat. 4133), in paragraph (15), by transferring such paragraph
so as to insert it after paragraph (14A) of subsection (a);
(3) in subsection (a)(9), by inserting ``, watercraft, or
aircraft'' after ``motor vehicle'';
(4) in subsection (a)(15), as so redesignated by paragraph
(2) of this subsection, by inserting ``to a spouse, former
spouse, or child of the debtor and'' after ``(15)''; and
(5) in subsection (e), by striking ``a insured'' and
inserting ``an insured''.
SEC. 1113. EFFECT OF DISCHARGE.
Section 524(a)(3) of title 11, United States Code, is amended by
striking ``section 523'' and all that follows through ``or that'' and
inserting ``section 523, 1228(a)(1), or 1328(a)(1) of this title, or
that''.
SEC. 1114. PROTECTION AGAINST DISCRIMINATORY TREATMENT.
Section 525(c) of title 11, United States Code, is amended--
(1) in paragraph (1), by inserting ``student'' before
``grant'' the second place it appears; and
(2) in paragraph (2), by striking ``the program operated
under part B, D, or E of'' and inserting ``any program operated
under''.
SEC. 1115. PROPERTY OF THE ESTATE.
Section 541(b)(4)(B)(ii) of title 11, United States Code, is
amended by inserting ``365 or'' before ``542''.
SEC. 1116. PREFERENCES.
(a) In General.--Section 547 of title 11, United States Code, is
amended--
(1) in subsection (b), by striking ``subsection (c)'' and
inserting ``subsections (c) and (i)''; and
(2) by adding at the end the following:
``(i) If the trustee avoids under subsection (b) a transfer made
between 90 days and 1 year before the date of the filing of the
petition, by the debtor to an entity that is not an insider for the
benefit of a creditor that is an insider, such transfer may be avoided
under this section only with respect to the creditor that is an
insider.''.
(b) Applicability.--The amendments made by this section shall apply
to any case that is pending or commenced on or after the date of
enactment of this Act.
SEC. 1117. POSTPETITION TRANSACTIONS.
Section 549(c) of title 11, United States Code, is amended--
(1) by inserting ``an interest in'' after ``transfer of'';
(2) by striking ``such property'' and inserting ``such real
property''; and
(3) by striking ``the interest'' and inserting ``such
interest''.
SEC. 1118. DISPOSITION OF PROPERTY OF THE ESTATE.
Section 726(b) of title 11, United States Code, is amended by
striking ``1009,''.
SEC. 1119. GENERAL PROVISIONS.
Section 901(a) of title 11, United States Code, is amended by
inserting ``1123(d),'' after ``1123(b),''.
SEC. 1120. APPOINTMENT OF ELECTED TRUSTEE.
Section 1104(b) of title 11, United States Code, is amended--
(1) by inserting ``(1)'' after ``(b)''; and
(2) by adding at the end the following:
``(2)(A) If an eligible, disinterested trustee is elected at a
meeting of creditors under paragraph (1), the United States trustee
shall file a report certifying that election. Upon the filing of a
report under the preceding sentence--
``(i) the trustee elected under paragraph (1) shall be
considered to have been selected and appointed for purposes of
this section; and
``(ii) the service of any trustee appointed under
subsection (d) shall terminate.
``(B) In the case of any dispute arising out of an election under
subparagraph (A), the court shall resolve the dispute.''.
SEC. 1121. ABANDONMENT OF RAILROAD LINE.
Section 1170(e)(1) of title 11, United States Code, is amended by
striking ``section 11347'' and inserting ``section 11326(a)''.
SEC. 1122. CONTENTS OF PLAN.
Section 1172(c)(1) of title 11, United States Code, is amended by
striking ``section 11347'' and inserting ``section 11326(a)''.
SEC. 1123. DISCHARGE UNDER CHAPTER 12.
Subsections (a) and (c) of section 1228 of title 11, United States
Code, are amended by striking ``1222(b)(10)'' each place it appears and
inserting ``1222(b)(9)''.
SEC. 1124. BANKRUPTCY CASES AND PROCEEDINGS.
Section 1334(d) of title 28, United States Code, is amended--
(1) by striking ``made under this subsection'' and
inserting ``made under subsection (c)''; and
(2) by striking ``This subsection'' and inserting
``Subsection (c) and this subsection''.
SEC. 1125. KNOWING DISREGARD OF BANKRUPTCY LAW OR RULE.
Section 156(a) of title 18, United States Code, is amended--
(1) in the first undesignated paragraph--
(A) by inserting ``(1) the term'' before
```bankruptcy''; and
(B) by striking the period at the end and inserting
``; and''; and
(2) in the second undesignated paragraph--
(A) by inserting ``(2) the term'' before
```document''; and
(B) by striking ``this title'' and inserting
``title 11''.
SEC. 1126. TRANSFERS MADE BY NONPROFIT CHARITABLE CORPORATIONS.
(a) Sale of Property of Estate.--Section 363(d) of title 11, United
States Code, is amended--
(1) by striking ``only'' and all that follows through the
end of the subsection and inserting ``only--
``(1) in accordance with applicable nonbankruptcy law that
governs the transfer of property by a corporation or trust that
is not a moneyed, business, or commercial corporation or trust;
and
``(2) to the extent not inconsistent with any relief
granted under subsection (c), (d), (e), or (f) of section 362
of this title.''.
(b) Confirmation of Plan for Reorganization.--Section 1129(a) of
title 11, United States Code, as amended by section 140, is amended by
adding at the end the following:
``(15) All transfers of property of the plan shall be made
in accordance with any applicable provisions of nonbankruptcy
law that govern the transfer of property by a corporation or
trust that is not a moneyed, business, or commercial
corporation or trust.''.
(c) Transfer of Property.--Section 541 of title 11, United States
Code, as amended by section 1102, is amended by adding at the end the
following:
``(f) Notwithstanding any other provision of this title, property
that is held by a debtor that is a corporation described in section
501(c)(3) of the Internal Revenue Code of 1986 and exempt from tax
under section 501(a) of such Code may be transferred to an entity that
is not such a corporation, but only under the same conditions as would
apply if the debtor had not filed a case under this title.''.
(d) Applicability.--The amendments made by this section shall apply
to a case pending under title 11, United States Code, on the date of
enactment of this Act, except that the court shall not confirm a plan
under chapter 11 of this title without considering whether this section
would substantially affect the rights of a party in interest who first
acquired rights with respect to the debtor after the date of the
petition. The parties who may appear and be heard in a proceeding under
this section include the attorney general of the State in which the
debtor is incorporated, was formed, or does business.
(e) Rule of Construction.--Nothing in this section shall be deemed
to require the court in which a case under chapter 11 is pending to
remand or refer any proceeding, issue, or controversy to any other
court or to require the approval of any other court for the transfer of
property.
SEC. 1127. PROHIBITION ON CERTAIN ACTIONS FOR FAILURE TO INCUR FINANCE
CHARGES.
Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is amended
by adding at the end the following:
``(i) Prohibition on Certain Actions for Failure To Incur Finance
Charges.--A creditor of an account under an open end consumer credit
plan may not terminate an account prior to its expiration date solely
because the consumer has not incurred finance charges on the account.
Nothing in this subsection shall prohibit a creditor from terminating
an account for inactivity in 3 or more consecutive months.''.
SEC. 1128. PROTECTION OF VALID PURCHASE MONEY SECURITY INTERESTS.
Section 547(c)(3)(B) of title 11, United States Code, is amended by
striking ``20'' and inserting ``30''.
SEC. 1129. TRUSTEES.
(a) Suspension and Termination of Panel Trustees and Standing
Trustees.--Section 586(d) of title 28, United States Code, is amended--
(1) by inserting ``(1)'' after ``(d)''; and
(2) by adding at the end the following:
``(2) A trustee whose appointment under subsection (a)(1) or under
subsection (b) is terminated or who ceases to be assigned to cases
filed under title 11 of the United States Code may obtain judicial
review of the final agency decision by commencing an action in the
United States district court for the district for which the panel to
which the trustee is appointed under subsection (a)(1), or in the
United States district court for the district in which the trustee is
appointed under subsection (b) resides, after first exhausting all
available administrative remedies, which if the trustee so elects,
shall also include an administrative hearing on the record. Unless the
trustee elects to have an administrative hearing on the record, the
trustee shall be deemed to have exhausted all administrative remedies
for purposes of this paragraph if the agency fails to make a final
agency decision within 90 days after the trustee requests
administrative remedies. The Attorney General shall prescribe
procedures to implement this paragraph. The decision of the agency
shall be affirmed by the district court unless it is unreasonable and
without cause based on the administrative record before the agency.''.
(b) Expenses of Standing Trustees.--Section 586(e) of title 28,
United States Code, is amended by adding at the end the following:
``(3) After first exhausting all available administrative remedies,
an individual appointed under subsection (b) may obtain judicial review
of final agency action to deny a claim of actual, necessary expenses
under this subsection by commencing an action in the United States
district court in the district where the individual resides. The
decision of the agency shall be affirmed by the district court unless
it is unreasonable and without cause based upon the administrative
record before the agency.
``(4) The Attorney General shall prescribe procedures to implement
this subsection.''.
TITLE XII--GENERAL EFFECTIVE DATE; APPLICATION OF AMENDMENTS
SEC. 1201. EFFECTIVE DATE; APPLICATION OF AMENDMENTS.
(a) Effective Date.--Except as provided otherwise in this Act, this
Act and the amendments made by this Act shall take effect 180 days
after the date of the enactment of this Act.
(b) Application of Amendments.--Except as otherwise provided in
this Act, the amendments made by this Act shall not apply with respect
to cases commenced under title 11 of the United States Code before the
effective date of this Act.