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







107th CONGRESS
  1st Session
                                H. R. 1088

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


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 19, 2001

   Mr. Fossella (for himself, Mr. Oxley, Mr. Baker, Mrs. Kelly, Mrs. 
 Maloney of New York, Mr. Menendez, Mr. Reynolds, Mr. Royce, Mr. King, 
  Mr. Ose, Mrs. Roukema, Mr. Foley, Mr. Toomey, Mr. Gillmor, Mr. Gary 
Miller of California, Mr. Rogers of Michigan, Mr. Shadegg, Mr. Grucci, 
   Mr. Weldon of Florida, Mr. Shays, Mr. Manzullo, Mr. Ackerman, Mr. 
Crowley, Mr. Ford, Mr. Moore, Mr. Blagojevich, Mr. Israel, Mr. Bentsen, 
    Mr. Bachus, Ms. Hart, Mr. Jones of North Carolina, Mr. Ney, Mr. 
    Sweeney, Mr. Ross, Ms. Velazquez, and Mr. Engel) introduced the 
   following bill; which was referred to the Committee on Financial 
                                Services

_______________________________________________________________________

                                 A BILL


 
 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 ``$12 per 
        $1,000,000'';
            (2) in the first sentence of subsection (b), by striking 
        ``, except that'' and all that follows through the end of such 
        sentence;
            (3) in paragraph (1) of subsection (d), by striking ``, 
        except that'' and all that follows through the end of such 
        paragraph;
            (4) in subsection (e), by striking ``$0.02'' and inserting 
        ``$0.0072''; and
            (5) 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 equal to 
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 ``security futures 
                products)''; and
                    (D) by striking ``, excluding any sales for which a 
                fee is paid under subsection (c)'';
            (4) in subsection (e)--
                    (A) 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) 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.
            ``(3) Review and effective date.--An adjusted rate 
        prescribed under paragraph (1) or (2) 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; and
                    ``(B) an adjusted rate prescribed under paragraph 
                (2) 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:
      

 
            Fiscal year           Target offsetting collection amount
 
      2002...................                  $585,720,000
      2003...................                  $679,320,000
      2004...................                  $822,240,000
      2005...................                  $976,320,000
      2006...................                $1,148,040,000
      2007...................                  $880,880,000
      2008...................                  $892,080,000
      2009...................                $1,023,120,000
      2010...................                $1,161,440,000
      2011...................                $1,321,040,000
 

            ``(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, and 
        security futures products) 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 $125 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 equal to less than $1,000,000.
            ``(8) Review and effective date.--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) 30 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) 30 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 30 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:
      

 
            Fiscal year           Target offsetting collection amount
 
      2002...................                 $512,500,000
      2003...................                 $589,380,000
      2004...................                 $650,385,000
      2005...................                 $790,075,000
      2006...................                 $949,050,000
      2007...................                 $214,200,000
      2008...................                 $233,700,000
      2009...................                 $284,115,000
      2010...................                 $333,840,000
      2011...................                 $394,110,000
 

                    ``(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 $125 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 equal to less than $1,000,000.
            ``(8) Review and effective date.--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) 30 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) 30 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 30 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 $125 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 equal to less than $1,000,000.
            ``(8) Review and effective date.--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) 30 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) 30 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 30 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. PAY PARITY PROVISIONS.

    (a) Securities and Exchange Commission Employees.--Section 4(b) of 
the Securities Exchange Act of 1934 (15 U.S.C. 78d(b)) is amended--
            (1) by striking paragraphs (1) and (2) and by inserting the 
        following:
            ``(1) Appointment, compensation, and benefits.--
                    ``(A) In general.--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 this 
                Act.
                    ``(B) Rates of pay.--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 of title 5, 
                United States Code.
                    ``(C) Additional compensation and benefits.--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 or, if not then being provided, 
                could be provided by such an agency under applicable 
                provisions of law, rule, or regulation.
            ``(2) Information; comparability.--In establishing and 
        adjusting schedules of compensation and additional benefits for 
        employees of the Commission, which are to be determined solely 
        by the Commission under this subsection, the Commission--
                    ``(A) shall consult with and inform the heads of 
                the agencies referred to under section 1206 of the 
                Financial Institutions Reform, Recovery, and 
                Enforcement Act of 1989;
                    ``(B) shall inform the Congress of such 
                compensation and benefits; and
                    ``(C) shall seek to maintain comparability with 
                such agencies regarding compensation and benefits.''.
    (b) Technical Amendments.--
            (1) Section 3132(a)(1) of title 5, United States Code, is 
        amended--
                    (A) in subparagraph (C), by striking ``or'' after 
                the semicolon;
                    (B) in subparagraph (D), by inserting ``or'' after 
                the semicolon; and
                    (C) by adding at the end of the following:
                    ``(E) the Securities and Exchange Commission.''.
            (2) Section 5373(a) of title 5, United States Code, is 
        amended--
                    (A) in paragraph (2), by striking ``or'' after the 
                semicolon;
                    (B) in paragraph (3), by striking the period and 
                inserting ``; or''; and
                    (C) by adding at the end the following:
            ``(4) section 4(b) of the Securities Exchange Act of 
        1934.''.

SEC. 9. EFFECTIVE DATES.

    (a) In General.--Except as provided in subsection (b), the 
amendments made by this Act shall take effect on October 1, 2001.
    (b) Pay Parity.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by section 8 shall take effect on the date of 
        enactment of this Act.
            (2) Exception.--The amendments made by section 8(b)(1) 
        shall take effect as of such date as the Securities and 
        Exchange Commission shall (by order published in the Federal 
        Register) prescribe, but in no event later than 1 year after 
        the date of enactment of this Act.
                                 <all>