[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1088 Engrossed in House (EH)]

  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
107th CONGRESS
  1st Session
                                H. R. 1088

_______________________________________________________________________

                                 AN ACT


 
 To amend the Securities Exchange Act of 1934 to reduce fees collected 
   by the Securities and Exchange Commission, 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.

    This Act may be cited as the ``Investor and Capital Markets Fee 
Relief Act''.

SEC. 2. IMMEDIATE TRANSACTION FEE REDUCTIONS.

    Section 31 of the Securities Exchange Act of 1934 (15 U.S.C. 78ee) 
is amended--
            (1) by striking ``\1/300\ of one percent'' each place it 
        appears in subsections (b) and (d) and inserting ``$15 per 
        $1,000,000'';
            (2) by striking ``and security futures products'' each 
        place it appears in such subsections and inserting ``security 
        futures products, and options on securities indexes (excluding 
        a narrow-based security index)'';
            (3) in the first sentence of subsection (b), by striking 
        ``, except that'' and all that follows through the end of such 
        sentence and inserting a period;
            (4) in paragraph (1) of subsection (d), by striking ``, 
        except that'' and all that follows through the end of such 
        paragraph and inserting a period;
            (5) in subsection (e), by striking ``$0.02'' and inserting 
        ``$0.009''; and
            (6) by adding at the end the following new subsection:
    ``(i) Pro Rata Application.--The rates per $1,000,000 required by 
this section shall be applied pro rata to amounts and balances of less 
than $1,000,000.''.

SEC. 3. REVISION OF SECURITIES TRANSACTION FEE PROVISIONS; ADDITIONAL 
              FEE REDUCTIONS.

    (a) Pooling and Allocation of Collections.--Section 31 of the 
Securities Exchange Act of 1934 (15 U.S.C. 78ee) is further amended--
            (1) in subsection (b)--
                    (A) by striking ``Every'' and inserting ``Subject 
                to subsection (j), each''; and
                    (B) by striking the last sentence;
            (2) by striking subsection (c);
            (3) in subsection (d)--
                    (A) by striking paragraphs (2) and (3);
                    (B) by striking the following:
    ``(d) Off-Exchange Trades of Last-Sale-Reported Securities.--
            ``(1) Covered transactions.--Each national securities''
                and inserting the following:
    ``(c) Off-Exchange Trades of Exchange Registered and Last-Sale-
Reported Securities.--Subject to subsection (j), each national 
securities'';
                    (C) by inserting ``registered on a national 
                securities exchange or'' after ``narrow-based security 
                index))'' (as added by section 2(2)); and
                    (D) by striking ``, excluding any sales for which a 
                fee is paid under subsection (c)'';
            (4) in subsection (e), by striking ``except that for fiscal 
        year 2007'' and all that follows through the end of such 
        subsection and inserting the following: ``except that for 
        fiscal year 2007 and each succeeding fiscal year such 
        assessment shall be equal to $0.0042 for each such 
        transaction.'';
            (5) in subsection (f), by striking ``Dates for Payment of 
        Fees.--The fees required'' and inserting ``Dates for 
        Payments.--The fees and assessments required'';
            (6) by redesignating subsections (e) through (i) (as added 
        by section 2(5)) as subsections (d) through (h), respectively;
            (7) by adding at the end the following new subsection:
    ``(i) Deposit of Fees.--
            ``(1) Offsetting collections.--Fees collected pursuant to 
        subsections (b), (c), and (d) for any fiscal year--
                    ``(A) shall be deposited and credited as offsetting 
                collections to the account providing appropriations to 
                the Commission; and
                    ``(B) except as provided in subsection (k), shall 
                not be collected for any fiscal year except to the 
                extent provided in advance in appropriation Acts.
            ``(2) General revenues prohibited.--No fees collected 
        pursuant to subsections (b), (c), and (d) for fiscal year 2002 
        or any succeeding fiscal year shall be deposited and credited 
        as general revenue of the Treasury.''.
    (b) Additional Reductions of Fees.--
            (1) Amendment.--Section 31 of the Securities Exchange Act 
        of 1934 (15 U.S.C. 78ee) is further amended by adding after 
        subsection (i) (as added by subsection (a)(7)) the following 
        new subsections:
    ``(j) Recapture of Projection Windfalls for Further Rate 
Reductions.--
            ``(1) Annual adjustment.--For each of the fiscal years 2003 
        through 2011, the Commission shall by order adjust each of the 
        rates applicable under subsections (b) and (c) for such fiscal 
        year to a uniform adjusted rate that, when applied to the 
        baseline estimate of the aggregate dollar amount of sales for 
        such fiscal year, is reasonably likely to produce aggregate fee 
        collections under this section (including assessments collected 
        under subsection (d)) that are equal to the target offsetting 
        collection amount for such fiscal year.
            ``(2) Mid-year adjustment.--For each of the fiscal years 
        2002 through 2011, the Commission shall determine, by March 1 
        of such fiscal year, whether, based on the actual aggregate 
        dollar volume of sales during the first 5 months of such fiscal 
        year, the baseline estimate of the aggregate dollar volume of 
        sales used under paragraph (1) for such fiscal year (or 
        $48,800,000,000,000 in the case of fiscal year 2002) is 
        reasonably likely to be 10 percent (or more) greater or less 
        than the actual aggregate dollar volume of sales for such 
        fiscal year. If the Commission so determines, the Commission 
        shall by order, no later than such March 1, adjust each of the 
        rates applicable under subsections (b) and (c) for such fiscal 
        year to a uniform adjusted rate that, when applied to the 
        revised estimate of the aggregate dollar amount of sales for 
        the remainder of such fiscal year, is reasonably likely to 
        produce aggregate fee collections under this section (including 
        fees collected during such 5-month period and assessments 
        collected under subsection (d)) that are equal to the target 
        offsetting collection amount for such fiscal year. In making 
        such revised estimate, the Commission shall, after consultation 
        with the Congressional Budget Office and the Office of 
        Management and Budget, use the same methodology required by 
        subsection (l)(2).
            ``(3) Final rate adjustment.--For fiscal year 2012 and all 
        of the succeeding fiscal years, the Commission shall by order 
        adjust each of the rates applicable under subsections (b) and 
        (c) for all of such fiscal years to a uniform adjusted rate 
        that, when applied to the baseline estimate of the aggregate 
        dollar amount of sales for fiscal year 2012, is reasonably 
        likely to produce aggregate fee collections under this section 
        in fiscal year 2012 (including assessments collected under 
        subsection (d)) equal to the target offsetting collection 
        amount for fiscal year 2011.
            ``(4) Review and effective date.-- In exercising its 
        authority under this subsection, the Commission shall not be 
        required to comply with the provisions of section 553 of title 
        5, United States Code. An adjusted rate prescribed under 
        paragraph (1), (2), or (3) and published under subsection (g) 
        shall not be subject to judicial review. Subject to subsections 
        (i)(1)(B) and (k)--
                    ``(A) an adjusted rate prescribed under paragraph 
                (1) shall take effect on the later of--
                            ``(i) the first day of the fiscal year to 
                        which such rate applies; or
                            ``(ii) 30 days after the date on which a 
                        regular appropriation to the Commission for 
                        such fiscal year is enacted;
                    ``(B) an adjusted rate prescribed under paragraph 
                (2) shall take effect on April 1 of the fiscal year to 
                which such rate applies; and
                    ``(C) an adjusted rate prescribed under paragraph 
                (3) shall take effect on the later of--
                            ``(i) the first day of fiscal year 2012; or
                            ``(ii) 30 days after the date on which a 
                        regular appropriation to the Commission for 
                        fiscal year 2012 is enacted.
    ``(k) Lapse of Appropriation.--If on the first day of a fiscal year 
a regular appropriation to the Commission has not been enacted, the 
Commission shall continue to collect (as offsetting collections) the 
fees and assessments under subsections (b), (c), and (d) at the rate in 
effect during the preceding fiscal year, until 30 days after the date 
such a regular appropriation is enacted.
    ``(l) Definitions.--For purposes of this section:
            ``(1) Target offsetting collection amount.--The target 
        offsetting collection amount for each of the fiscal years 2002 
        through 2011 is determined according to the following table:

  
                                                      Target offsetting
``Fiscal year:
                                                      collection amount

  2002...............................................     $732,000,000 
  2003...............................................     $849,000,000 
  2004...............................................   $1,028,000,000 
  2005...............................................   $1,220,000,000 
  2006...............................................   $1,435,000,000 
  2007...............................................     $881,000,000 
  2008...............................................     $892,000,000 
  2009...............................................   $1,023,000,000 
  2010...............................................   $1,161,000,000 
  2011...............................................   $1,321,000,000 
            ``(2) Baseline estimate of the aggregate dollar amount of 
        sales.--The baseline estimate of the aggregate dollar amount of 
        sales for any fiscal year is the baseline estimate of the 
        aggregate dollar amount of sales of securities (other than 
        bonds, debentures, other evidences of indebtedness, security 
        futures products, and options on securities indexes (excluding 
        a narrow-based security index)) to be transacted on each 
        national securities exchange and by or through any member of 
        each national securities association (otherwise than on a 
        national securities exchange) during such fiscal year as 
        determined by the Commission, after consultation with the 
        Congressional Budget Office and the Office of Management and 
        Budget, using the methodology required for making projections 
        pursuant to section 257 of the Balanced Budget and Emergency 
        Deficit Control Act of 1985.''.
            (2) Conforming amendment.--Section 31(g) of such Act (as 
        redesignated by subsection (a)(6) of this section) is amended 
        by inserting before the period at the end the following: ``not 
        later than April 30 of the fiscal year preceding the fiscal 
        year to which such rate applies, together with any estimates or 
        projections on which such fees are based''.

SEC. 4. REDUCTION OF REGISTRATION FEES.

    Section 6(b) of the Securities Act of 1933 (15 U.S.C. 77f(b)) is 
amended by striking paragraphs (2) through (5) and inserting the 
following:
            ``(2) Fee payment required.--At the time of filing a 
        registration statement, the applicant shall pay to the 
        Commission a fee at a rate that shall be equal to $92 per 
        $1,000,000 of the maximum aggregate price at which such 
        securities are proposed to be offered, except that during 
        fiscal year 2003 and any succeeding fiscal year such fee shall 
        be adjusted pursuant to paragraph (5) or (6).
            ``(3) Offsetting collections.--Fees collected pursuant to 
        this subsection for any fiscal year--
                    ``(A) shall be deposited and credited as offsetting 
                collections to the account providing appropriations to 
                the Commission; and
                    ``(B) except as provided in paragraph (9), shall 
                not be collected for any fiscal year except to the 
                extent provided in advance in appropriation Acts.
            ``(4) General revenues prohibited.--No fees collected 
        pursuant to this subsection for fiscal year 2002 or any 
        succeeding fiscal year shall be deposited and credited as 
        general revenue of the Treasury.
            ``(5) Annual adjustment.--For each of the fiscal years 2003 
        through 2011, the Commission shall by order adjust the rate 
        required by paragraph (2) for such fiscal year to a rate that, 
        when applied to the baseline estimate of the aggregate maximum 
        offering prices for such fiscal year, is reasonably likely to 
        produce aggregate fee collections under this subsection that 
        are equal to the target offsetting collection amount for such 
        fiscal year.
            ``(6) Final rate adjustment.--For fiscal year 2012 and all 
        of the succeeding fiscal years, the Commission shall by order 
        adjust the rate required by paragraph (2) for all of such 
        fiscal years to a rate that, when applied to the baseline 
        estimate of the aggregate maximum offering prices for fiscal 
        year 2012, is reasonably likely to produce aggregate fee 
        collections under this subsection in fiscal year 2012 equal to 
        the target offsetting collection amount for fiscal year 2011.
            ``(7) Pro rata application.--The rates per $1,000,000 
        required by this subsection shall be applied pro rata to 
        amounts and balances of less than $1,000,000.
            ``(8) Review and effective date.-- In exercising its 
        authority under this subsection, the Commission shall not be 
        required to comply with the provisions of section 553 of title 
        5, United States Code. An adjusted rate prescribed under 
        paragraph (5) or (6) and published under paragraph (10) shall 
        not be subject to judicial review. Subject to paragraphs (3)(B) 
        and (9)--
                    ``(A) an adjusted rate prescribed under paragraph 
                (5) shall take effect on the later of--
                            ``(i) the first day of the fiscal year to 
                        which such rate applies; or
                            ``(ii) 5 days after the date on which a 
                        regular appropriation to the Commission for 
                        such fiscal year is enacted; and
                    ``(B) an adjusted rate prescribed under paragraph 
                (6) shall take effect on the later of--
                            ``(i) the first day of fiscal year 2012; or
                            ``(ii) 5 days after the date on which a 
                        regular appropriation to the Commission for 
                        fiscal year 2012 is enacted.
            ``(9) Lapse of appropriation.--If on the first day of a 
        fiscal year a regular appropriation to the Commission has not 
        been enacted, the Commission shall continue to collect fees (as 
        offsetting collections) under this subsection at the rate in 
        effect during the preceding fiscal year, until 5 days after the 
        date such a regular appropriation is enacted.
            ``(10) Publication.--The Commission shall publish in the 
        Federal Register notices of the rate applicable under this 
        subsection and under sections 13(e) and 14(g) for each fiscal 
        year not later than April 30 of the fiscal year preceding the 
        fiscal year to which such rate applies, together with any 
        estimates or projections on which such rate is based.
            ``(11) Definitions.--For purposes of this subsection:
                    ``(A) Target offsetting collection amount.--The 
                target offsetting collection amount for each of the 
                fiscal years 2002 through 2011 is determined according 
                to the following table:

  
                                                      Target offsetting
``Fiscal year:
                                                      collection amount
  2002...............................................      $337,000,000
  2003...............................................      $435,000,000
  2004...............................................      $467,000,000
  2005...............................................      $570,000,000
  2006...............................................      $689,000,000
  2007...............................................      $214,000,000
  2008...............................................      $234,000,000
  2009...............................................      $284,000,000
  2010...............................................      $334,000,000
  2011...............................................      $394,000,000

                    ``(B) Baseline estimate of the aggregate maximum 
                offering prices.--The baseline estimate of the 
                aggregate maximum offering prices for any fiscal year 
                is the baseline estimate of the aggregate maximum 
                offering price at which securities are proposed to be 
                offered pursuant to registration statements filed with 
                the Commission during such fiscal year as determined by 
                the Commission, after consultation with the 
                Congressional Budget Office and the Office of 
                Management and Budget, using the methodology required 
                for projections pursuant to section 257 of the Balanced 
                Budget and Emergency Deficit Control Act of 1985.''.

SEC. 5. FEES FOR STOCK REPURCHASE STATEMENTS.

    Section 13(e) of the Securities Exchange Act of 1934 (15 U.S.C. 
78m(e)) is amended
            (1) in paragraph (3), by striking ``a fee of \1/50\ of 1 
        per centum of the value of securities proposed to be 
        purchased'' and inserting ``a fee at a rate that, subject to 
        paragraphs (5) and (6), is equal to $92 per $1,000,000 of the 
        value of securities proposed to be purchased'';
            (2) by inserting after paragraph (3) the following new 
        paragraphs:
            ``(4) Offsetting collections.--Fees collected pursuant to 
        this subsection for any fiscal year shall be deposited and 
        credited as offsetting collections to the account providing 
        appropriations to the Commission, and, except as provided in 
        paragraph (9), shall not be collected for any fiscal year 
        except to the extent provided in advance in appropriation Acts. 
        No fees collected pursuant to this subsection for fiscal year 
        2002 or any succeeding fiscal year shall be deposited and 
        credited as general revenue of the Treasury.
            ``(5) Annual adjustment.--For each of the fiscal years 2003 
        through 2011, the Commission shall by order adjust the rate 
        required by paragraph (3) for such fiscal year to a rate that 
        is equal to the rate (expressed in dollars per million) that is 
        applicable under section 6(b) of the Securities Act of 1933 for 
        such fiscal year.
            ``(6) Final rate adjustment.--For fiscal year 2012 and all 
        of the succeeding fiscal years, the Commission shall by order 
        adjust the rate required by paragraph (3) for all of such 
        fiscal years to a rate that is equal to the rate (expressed in 
        dollars per million) that is applicable under section 6(b) of 
        the Securities Act of 1933 for all of such fiscal years.
            ``(7) Pro rata application.--The rates per $1,000,000 
        required by this subsection shall be applied pro rata to 
        amounts and balances of less than $1,000,000.
            ``(8) Review and effective date.-- In exercising its 
        authority under this subsection, the Commission shall not be 
        required to comply with the provisions of section 553 of title 
        5, United States Code. An adjusted rate prescribed under 
        paragraph (5) or (6) and published under paragraph (10) shall 
        not be subject to judicial review. Subject to paragraphs (4) 
        and (9)--
                    ``(A) an adjusted rate prescribed under paragraph 
                (5) shall take effect on the later of--
                            ``(i) the first day of the fiscal year to 
                        which such rate applies; or
                            ``(ii) 5 days after the date on which a 
                        regular appropriation to the Commission for 
                        such fiscal year is enacted; and
                    ``(B) an adjusted rate prescribed under paragraph 
                (6) shall take effect on the later of--
                            ``(i) the first day of fiscal year 2012; or
                            ``(ii) 5 days after the date on which a 
                        regular appropriation to the Commission for 
                        fiscal year 2012 is enacted.
            ``(9) Lapse of appropriation.--If on the first day of a 
        fiscal year a regular appropriation to the Commission has not 
        been enacted, the Commission shall continue to collect fees (as 
        offsetting collections) under this subsection at the rate in 
        effect during the preceding fiscal year, until 5 days after the 
        date such a regular appropriation is enacted.
            ``(10) Publication.--The rate applicable under this 
        subsection for each fiscal year is published pursuant to 
        section 6(b)(10) of the Securities Act of 1933.''.

SEC. 6. FEES FOR PROXY SOLICITATIONS AND STATEMENTS IN CORPORATE 
              CONTROL TRANSACTIONS.

    Section 14(g) of the Securities Exchange Act of 1934 (15 U.S.C. 
78m(e)(3)) is amended--
            (1) in paragraphs (1) and (3), by striking ``a fee of \1/
        50\ of 1 per centum of'' each place it appears and inserting 
        ``a fee at a rate that, subject to paragraphs (5) and (6), is 
        equal to $92 per $1,000,000 of'';
            (2) by redesignating paragraph (4) as paragraph (11); and
            (3) by inserting after paragraph (3) the following new 
        paragraphs:
            ``(4) Offsetting collections.--Fees collected pursuant to 
        this subsection for any fiscal year shall be deposited and 
        credited as offsetting collections to the account providing 
        appropriations to the Commission, and, except as provided in 
        paragraph (9), shall not be collected for any fiscal year 
        except to the extent provided in advance in appropriation Acts. 
        No fees collected pursuant to this subsection for fiscal year 
        2002 or any succeeding fiscal year shall be deposited and 
        credited as general revenue of the Treasury.
            ``(5) Annual adjustment.--For each of the fiscal years 2003 
        through 2011, the Commission shall by order adjust each of the 
        rates required by paragraphs (1) and (3) for such fiscal year 
        to a rate that is equal to the rate (expressed in dollars per 
        million) that is applicable under section 6(b) of the 
        Securities Act of 1933 for such fiscal year.
            ``(6) Final rate adjustment.--For fiscal year 2012 and all 
        of the succeeding fiscal years, the Commission shall by order 
        adjust each of the rates required by paragraphs (1) and (3) for 
        all of such fiscal years to a rate that is equal to the rate 
        (expressed in dollars per million) that is applicable under 
        section 6(b) of the Securities Act of 1933 for all of such 
        fiscal years.
            ``(7) Pro rata application.--The rates per $1,000,000 
        required by this subsection shall be applied pro rata to 
        amounts and balances of less than $1,000,000.
            ``(8) Review and effective date.-- In exercising its 
        authority under this subsection, the Commission shall not be 
        required to comply with the provisions of section 553 of title 
        5, United States Code. An adjusted rate prescribed under 
        paragraph (5) or (6) and published under paragraph (10) shall 
        not be subject to judicial review. Subject to paragraphs (4) 
        and (9)--
                    ``(A) an adjusted rate prescribed under paragraph 
                (5) shall take effect on the later of--
                            ``(i) the first day of the fiscal year to 
                        which such rate applies; or
                            ``(ii) 5 days after the date on which a 
                        regular appropriation to the Commission for 
                        such fiscal year is enacted; and
                    ``(B) an adjusted rate prescribed under paragraph 
                (6) shall take effect on the later of--
                            ``(i) the first day of fiscal year 2012; or
                            ``(ii) 5 days after the date on which a 
                        regular appropriation to the Commission for 
                        fiscal year 2012 is enacted.
            ``(9) Lapse of appropriation.--If on the first day of a 
        fiscal year a regular appropriation to the Commission has not 
        been enacted, the Commission shall continue to collect fees (as 
        offsetting collections) under this subsection at the rate in 
        effect during the preceding fiscal year, until 5 days after the 
        date such a regular appropriation is enacted.
            ``(10) Publication.--The rate applicable under this 
        subsection for each fiscal year is published pursuant to 
        section 6(b)(10) of the Securities Act of 1933.''.

SEC. 7. TRUST INDENTURE ACT FEE.

    Section 307(b) of the Trust Indenture Act of 1939 (15 U.S.C. 
77ggg(b)) is amended by striking ``Commission, but, in the case'' and 
all that follows and inserting ``Commission.''.

SEC. 8. COMPARABILITY PROVISIONS.

    (a) Commission Demonstration Project.--Subpart C of part III of 
title 5, United States Code, is amended by adding at the end the 
following:

          ``CHAPTER 48--AGENCY PERSONNEL DEMONSTRATION PROJECT

``Sec.
``4801. Nonapplicability of chapter 47.
``4802. Securities and Exchange Commission.
``Sec. 4801. Nonapplicability of chapter 47
    ``Chapter 47 shall not apply to this chapter.
``Sec. 4802. Securities and Exchange Commission
    ``(a) In this section, the term `Commission' means the Securities 
and Exchange Commission.
    ``(b) The Commission may appoint and fix the compensation of such 
officers, attorneys, economists, examiners, and other employees as may 
be necessary for carrying out its functions under the securities laws 
as defined under section 3 of the Securities Exchange Act of 1934 (15 
U.S.C. 78c).
    ``(c) Rates of basic pay for all employees of the Commission may be 
set and adjusted by the Commission without regard to the provisions of 
chapter 51 or subchapter III of chapter 53.
    ``(d) The Commission may provide additional compensation and 
benefits to employees of the Commission if the same type of 
compensation or benefits are then being provided by any agency referred 
to under section 1206 of the Financial Institutions Reform, Recovery, 
and Enforcement Act of 1989 (12 U.S.C. 1833b) or, if not then being 
provided, could be provided by such an agency under applicable 
provisions of law, rule, or regulation. In setting and adjusting the 
total amount of compensation and benefits for employees, the Commission 
shall consult with, and seek to maintain comparability with, the 
agencies referred to under section 1206 of the Financial Institutions 
Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1833b).
    ``(e) The Commission shall consult with the Office of Personnel 
Management in the implementation of this section.
    ``(f) This section shall be administered consistent with merit 
system principles.''.
    (b) Employees Represented by Labor Organizations.--To the extent 
that any employee of the Securities and Exchange Commission is 
represented by a labor organization with exclusive recognition in 
accordance with chapter 71 of title 5, United States Code, no reduction 
in base pay of such employee shall be made by reason of enactment of 
this section (including the amendments made by this section).
    (c) Implementation Plan and Report.--
            (1) Implementation plan.--
                    (A) In general.--The Securities and Exchange 
                Commission shall develop a plan to implement section 
                4802 of title 5, United States Code, as added by this 
                section.
                    (B) Inclusion in annual performance plan and 
                report.--The Securities and Exchange Commission shall 
                include--
                            (i) the plan developed under this paragraph 
                        in the annual program performance plan 
                        submitted under section 1115 of title 31, 
                        United States Code; and
                            (ii) the effects of implementing the plan 
                        developed under this paragraph in the annual 
                        program performance report submitted under 
                        section 1116 of title 31, United States Code.
            (2) Implementation report.--
                    (A) In general.--Before implementing the plan 
                developed under paragraph (1), the Securities and 
                Exchange Commission shall submit a report to the 
                Committee on Governmental Affairs and the Committee on 
                Banking, Housing, and Urban Affairs of the Senate, the 
                Committee on Government Reform and the Committee on 
                Financial Services of the House of Representatives, and 
                the Office of Personnel Management on the details of 
                the plan.
                    (B) Content.--The report under this paragraph shall 
                include--
                            (i) evidence and supporting documentation 
                        justifying the plan; and
                            (ii) budgeting projections on costs and 
                        benefits resulting from the plan.
    (d) Technical and Conforming Amendments.--
            (1) Amendments to title 5, united states code.--
                    (A) The table of chapters for part III of title 5, 
                United States Code, is amended by adding at the end of 
                subpart C the following:

``48. Agency Personnel Demonstration Project...............    4801.''.
                    (B) Section 3132(a)(1) of title 5, United States 
                Code, is amended--
                            (i) in subparagraph (C), by striking ``or'' 
                        after the semicolon;
                            (ii) in subparagraph (D), by inserting 
                        ``or'' after the semicolon; and
                            (iii) by adding at the end the following:
                    ``(E) the Securities and Exchange Commission;''.
                    (C) Section 5373(a) of title 5, United States Code, 
                is amended--
                            (i) in paragraph (2), by striking ``or'' 
                        after the semicolon;
                            (ii) in paragraph (3), by striking the 
                        period and inserting ``; or''; and
                            (iii) by adding at the end the following:
            ``(4) section 4802.''.
            (2) Amendment to securities exchange act of 1934.--Section 
        4(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78d(b)) 
        is amended by striking paragraphs (1) and (2) and inserting the 
        following:
            ``(1) Appointment and compensation.--The Commission shall 
        appoint and compensate officers, attorneys, economists, 
        examiners, and other employees in accordance with section 4802 
        of title 5, United States Code.
            ``(2) Reporting of information.--In establishing and 
        adjusting schedules of compensation and benefits for officers, 
        attorneys, economists, examiners, and other employees of the 
        Commission under applicable provisions of law, the Commission 
        shall inform the heads of the agencies referred to under 
        section 1206 of the Financial Institutions Reform, Recovery, 
        and Enforcement Act of 1989 (12 U.S.C. 1833b) and Congress of 
        such compensation and benefits and shall seek to maintain 
        comparability with such agencies regarding compensation and 
        benefits.''.
            (3) Amendment to firrea of 1989.--Section 1206 of the 
        Financial Institutions Reform, Recovery, and Enforcement Act of 
        1989 (12 U.S.C. 1833b) is amended by striking ``the Thrift 
        Depositor Protection Oversight Board of the Resolution Trust 
        Corporation''.

SEC. 9. STUDY OF THE EFFECT OF FEE REDUCTIONS.

    (a) Study.--The Office of Economic Analysis of the Securities and 
Exchange Commission (hereinafter referred to as the ``Office'') shall 
conduct a study of the extent to which the benefits of reductions in 
fees effected as a result of this Act are passed on to investors.
    (b) Factors for Consideration.--In conducting the study under 
subsection (a), the Office shall--
            (1) consider the various elements of the securities 
        industry directly and indirectly benefitting from the fee 
        reductions, including purchasers and sellers of securities, 
        members of national securities exchanges, issuers, broker-
        dealers, underwriters, participants in investment companies, 
        retirement programs, and others;
            (2) consider the impact on different types of investors, 
        such as individual equity holders, individual investment 
        company shareholders, businesses, and other types of investors;
            (3) include in the interpretation of the term ``investor'' 
        shareholders of entities subject to the fee reductions; and
            (4) consider the economic benefits to investors flowing 
        from the fee reductions to include such factors as market 
        efficiency, expansion of investment opportunities, and enhanced 
        liquidity and capital formation.
    (c) Report to Congress.--Not later than 2 years after the date of 
enactment of this Act, the Securities and Exchange Commission shall 
submit to the Congress the report prepared by the Office on the 
findings of the study conducted under subsection (a).

SEC. 10. STUDY OF CONVERSION TO SELF-FUNDING.

    (a) GAO Study Required.--The Comptroller General shall conduct a 
study of the impact, implications, and consequences of converting the 
Securities and Exchange Commission to a self-funded basis. Such study 
shall include analysis of the following issues:
            (1) SEC operations.--The impact of such conversion on the 
        Commission's operations, including staff quality, recruitment, 
        and retention.
            (2) Congressional oversight.--The implications for 
        congressional oversight of the Commission, including whether 
        imposing annual expenditure limitations would be beneficial to 
        such oversight.
            (3) Fees.--The likely consequences of the conversion on the 
        rates, collection procedures, and predictability of fees 
        collected by the Commission.
            (4) Appropriations.--The methods by which the conversion 
        may be accomplished without reducing the availability of 
        offsetting collections for appropriations.
            (5) Other matters.--Such other impacts, implications, and 
        consequences as the Comptroller General may consider relevant 
        to congressional consideration of the question of such 
        conversion.
    (b) Submission of Report.--The Comptroller General shall submit to 
the Committees on Financial Services and Government Reform of the House 
of Representatives and the Committees on Banking, Housing, and Urban 
Affairs and Governmental Affairs of the Senate a report on the study 
required by subsection (a) no later than 180 after the date of 
enactment of this Act.
    (c) Definition.--For the purposes of this section, the term ``self-
funded basis'' means that--
            (1) an agency is authorized to deposit the receipts of its 
        collections in the Treasury of the United States, or in a 
        depository institution, but such deposits are not treated as 
        Government funds or appropriated monies, and are available for 
        the salaries and other expenses of the Commission and its 
        employees without annual appropriation or apportionment; and
            (2) the agency is authorized to employ and fix the salaries 
        and other compensation of its officers and employees, and such 
        salaries and other compensation are paid without regard to the 
        provisions of other laws applicable to officers and employees 
        of the United States.

SEC. 11. EFFECTIVE DATES.

    (a) In General.--Except as provided in subsections (b) and (c), the 
amendments made by this Act shall take effect on October 1, 2001.
    (b) Immediate Transaction Fee Reductions.--The amendments made by 
section 2 shall take effect on the later of--
            (1) the first day of fiscal year 2002; or
            (2) 30 days after the date on which a regular appropriation 
        to the Commission for such fiscal year is   enacted.
    (c) Additional Exceptions.--The authorities provided by section 
6(b)(9) of the Securities Act of 1933 and sections 13(e)(9), 14(g)(9) 
and 31(k) of the Securities Exchange Act of 1934, as so designated by 
this Act, shall not apply until October 1, 2002.

            Passed the House of Representatives June 14, 2001.

            Attest:

                                                                 Clerk.
107th CONGRESS

  1st Session

                               H. R. 1088

_______________________________________________________________________

                                 AN ACT

 To amend the Securities Exchange Act of 1934 to reduce fees collected 
   by the Securities and Exchange Commission, and for other purposes.