[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 143 Introduced in Senate (IS)]
107th CONGRESS
1st Session
S. 143
To amend the Securities Act of 1933 and the Securities Exchange Act of
1934, to reduce securities fees in excess of those required to fund the
operations of the Securities and Exchange Commission, to adjust
compensation provisions for employees of the Commission, and for other
purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
January 22, 2001
Mr. Gramm (for himself, Mr. Schumer, Mr. Hagel, Mr. Enzi, Mr. Bennett,
Mr. Bunning, Mr. Bond, Mr. Torricelli, Mr. Allard, and Mr. Crapo)
introduced the following bill; which was read twice and referred to the
Committee on Banking, Housing, and Urban Affairs
_______________________________________________________________________
A BILL
To amend the Securities Act of 1933 and the Securities Exchange Act of
1934, to reduce securities fees in excess of those required to fund the
operations of the Securities and Exchange Commission, to adjust
compensation provisions for employees of the 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; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Competitive Market
Supervision Act of 2001''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Reduction in registration fee rates; elimination of general
revenue component.
Sec. 3. Reduction in merger and tender fee rates; reclassification as
offsetting collections.
Sec. 4. Reduction in transaction fees; elimination of general revenue
component.
Sec. 5. Adjustments to fee rates.
Sec. 6. Comparability provisions.
Sec. 7. Effective date.
SEC. 2. REDUCTION IN REGISTRATION FEE RATES; ELIMINATION OF GENERAL
REVENUE COMPONENT.
Section 6(b) of the Securities Act of 1933 (15 U.S.C. 77f(b)) is
amended--
(1) by striking paragraph (2) 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 that shall be equal to the amount determined
under the rate established by paragraph (3). The Commission
shall publish in the Federal Register notices of the fee rate
applicable under this section for each fiscal year.'';
(2) by striking paragraph (3);
(3) by redesignating paragraphs (4) and (5) as paragraphs
(3) and (4), respectively;
(4) in paragraph (3), as redesignated--
(A) by striking subparagraph (A) and inserting the
following:
``(A) In general.--Except as provided in
subparagraphs (B) and (C), the rate determined under
this paragraph is a rate equal to the following amount
per $1,000,000 of the maximum aggregate price at which
the securities are proposed to be offered:
``(i) $67 for each of fiscal years 2002
through 2006.
``(ii) $33 for fiscal year 2007 and each
fiscal year thereafter.''; and
(B) in subparagraph (B), by striking ``this
paragraph (4)'' and inserting ``this paragraph''; and
(5) by striking paragraph (4), as redesignated, and
inserting the following:
``(4) Pro rata application of rate.--The rate required by
this subsection shall be applied pro rata to amounts and
balances equal to or less than $1,000,000.''.
SEC. 3. REDUCTION IN MERGER AND TENDER FEE RATES; RECLASSIFICATION AS
OFFSETTING COLLECTIONS.
(a) Section 13.--Section 13(e)(3) of the Securities Exchange Act of
1934 (15 U.S.C. 78m(e)(3)) is amended to read as follows:
``(3) Fees.--
``(A) In general.--At the time of the filing of any
statement that the Commission may require by rule
pursuant to paragraph (1), the person making the filing
shall pay to the Commission a fee equal to--
``(i) $67 for each $1,000,000 of the value
of the securities proposed to be purchased, for
each of fiscal years 2002 through 2006; and
``(ii) $33 for each $1,000,000 of the value
of securities proposed to be purchased, for
fiscal year 2007 and each fiscal year
thereafter.
``(B) Reduction.--The fee required by this
paragraph shall be reduced with respect to securities
in an amount equal to any fee paid with respect to any
securities issued in connection with the proposed
transaction under section 6(b) of the Securities Act of
1933, or the fee paid under that section shall be
reduced in an amount equal to the fee paid to the
Commission in connection with such transaction under
this paragraph.
``(C) Limitation; deposit of fees.--
``(i) Limitation.--Except as provided in
subparagraph (D), no amounts shall be collected
pursuant to this paragraph for any fiscal year,
except to the extent provided in advance in
appropriations Acts.
``(ii) Deposit of fees.--Fees collected
during any fiscal year pursuant to this
paragraph shall be deposited and credited as
offsetting collections in accordance with
appropriations Acts.
``(D) Lapse of appropriations.--If, on the first
day of a fiscal year, a regular appropriation to the
Commission has not been enacted for that fiscal year,
the Commission shall continue to collect fees (as
offsetting collections) under this paragraph at the
rate in effect during the preceding fiscal year, until
such a regular appropriation is enacted.
``(E) Pro rata application of rate.--The rate
required by this paragraph shall be applied pro rata to
amounts and balances equal to or less than
$1,000,000.''.
(b) Section 14.--
(1) Preliminary proxy solicitations.--Section 14(g)(1) of
the Securities Exchange Act of 1934 (15 U.S.C. 78n(g)(1)) is
amended--
(A) in subparagraph (A), by striking ``Commission
the following fees'' and all that follows through the
end of the subparagraph and inserting ``Commission--
``(i) for preliminary proxy solicitation
material involving an acquisition, merger, or
consolidation, if there is a proposed payment
of each or transfer of securities or property
to shareholders, a fee equal to--
``(I) $67 for each $1,000,000 of
such proposed payment, or of the value
of such securities or other property
proposed to be transferred, for each of
fiscal years 2002 through 2006; and
``(II) $33 for each $1,000,000 of
such proposed payment, or of the value
of such securities or other property
proposed to be transferred, for fiscal
year 2007 and each fiscal year
thereafter; and
``(ii) for preliminary proxy solicitation
material involving a proposed sale or other
disposition of substantially all of the assets
of a company, a fee equal to--
``(I) $67 for each $1,000,000 of
the cash or of the value of any
securities or other property proposed
to be received upon such sale or
disposition, for each of fiscal years
2002 through 2006; and
``(II) $33 for each $1,000,000 of
the cash or of the value of any
securities or other property proposed
to be received upon such sale or
disposition, for fiscal year 2007 and
each fiscal year thereafter.'';
(B) in subparagraph (B), by inserting
``Reduction.--'' before ``The fee''; and
(C) by adding at the end the following:
``(C) Limitation; deposit of fees.--
``(i) Limitation.--Except as provided in
subparagraph (D), no amounts shall be collected
pursuant to this paragraph for any fiscal year,
except to the extent provided in advance in
appropriations Acts.
``(ii) Deposit of fees.--Fees collected
during any fiscal year pursuant to this
paragraph shall be deposited and credited as
offsetting collections in accordance with
appropriations Acts.
``(D) Lapse of appropriations.--If, on the first
day of a fiscal year, a regular appropriation to the
Commission has not been enacted for that fiscal year,
the Commission shall continue to collect fees (as
offsetting collections) under this paragraph at the
rate in effect during the preceding fiscal year, until
such a regular appropriation is enacted.
``(E) Pro rata application of rate.--The rate
required by this paragraph shall be applied pro rata to
amounts and balances equal to or less than
$1,000,000.''.
(2) Other filings.--Section 14(g)(3) of the Securities
Exchange Act of 1934 (15 U.S.C. 78n(g)(3)) is amended--
(A) by striking ``At the time'' and inserting the
following: ``Other filings.--
``(A) Fee rate.--At the time'';
(B) by striking ``the Commission a fee of'' and all
that follows through ``The fee'' and inserting the
following: ``the Commission a fee equal to--
``(i) $67 for each $1,000,000 of the
aggregate amount of cash or of the value of
securities or other property proposed to be
offered, for each of fiscal years 2002 through
2006; and
``(ii) $33 for each $1,000,000 of the
aggregate amount of cash or of the value of
securities or other property proposed to be
offered, for fiscal year 2007 and each fiscal
year thereafter.
``(B) Reduction.--The fee required under
subparagraph (A)''; and
(C) by adding at the end the following:
``(C) Limitation; deposit of fees.--
``(i) Limitation.--Except as provided in
subparagraph (D), no amounts shall be collected
pursuant to this paragraph for any fiscal year,
except to the extent provided in advance in
appropriations Acts.
``(ii) Deposit of fees.--Fees collected
during any fiscal year pursuant to this
paragraph shall be deposited and credited as
offsetting collections in accordance with
appropriations Acts.
``(D) Lapse of appropriations.--If, on the first
day of a fiscal year, a regular appropriation to the
Commission has not been enacted for that fiscal year,
the Commission shall continue to collect fees (as
offsetting collections) under this paragraph at the
rate in effect during the preceding fiscal year, until
such a regular appropriation is enacted.
``(E) Pro rata application of rate.--The rate
required by this paragraph shall be applied pro rata to
amounts and balances equal to or less than
$1,000,000.''.
SEC. 4. REDUCTION IN TRANSACTION FEES; ELIMINATION OF GENERAL REVENUE
COMPONENT.
Section 31 of the Securities Exchange Act of 1934 (15 U.S.C. 78ee)
is amended--
(1) by striking subsections (b) through (d) and inserting
the following:
``(b) Transaction Fees.--
``(1) In general.--Each national securities exchange and
national securities association shall pay to the Commission a
fee at a rate equal to the transaction offsetting collection
rate described in paragraph (2) of the aggregate dollar amount
of sales of securities (other than bonds, debentures, and other
evidences of indebtedness)--
``(A) transacted on such national securities
exchange;
``(B) transacted by or through any member of such
association otherwise than on a national securities
exchange of securities registered on such an exchange;
and
``(C) transacted by or through any member of such
association otherwise than on a national securities
exchange of securities that are subject to prompt last
sale reporting pursuant to the rules of the Commission
or a registered national securities association,
excluding any sales for which a fee is paid under
subparagraph (B).
``(2) Fee rate.--
``(A) Transaction offsetting collection rate.--For
purposes of this subsection, the `transaction
offsetting collection rate' for a fiscal year--
``(i) is the uniform rate required to reach
the transaction fee cap for that fiscal year;
and
``(ii) shall become effective on the later
of the beginning of that fiscal year or the
date of enactment of appropriations legislation
setting such rate.
``(B) Transaction fee cap.--For purposes of this
paragraph, the `transaction fee cap' shall be equal
to--
``(i) $497,000,000 for fiscal year 2002;
``(ii) $607,000,000 for fiscal year 2003;
``(iii) $706,000,000 for fiscal year 2004;
``(iv) $896,000,000 for fiscal year 2005;
``(v) $1,094,000,000 for fiscal year 2006;
``(vi) $554,000,000 for fiscal year 2007;
``(vii) $580,000,000 for fiscal year 2008;
``(viii) $719,000,000 for fiscal year 2009;
and
``(ix) $884,000,000 for fiscal year 2010
and each fiscal year thereafter.
``(c) Limitation; Deposit of Fees.--
``(1) Limitation.--Except as provided in subsection (d), no
amount may be collected pursuant to subsection (b) for any
fiscal year, except to the extent provided in advance in
appropriation Acts.
``(2) Deposit of fees.--Fees collected during any fiscal
year pursuant to this section shall be deposited and credited
as offsetting collections in accordance with appropriations
Acts.
``(d) Lapse of Appropriations.--If, on the first day of a fiscal
year, a regular appropriation to the Commission has not been enacted
for that fiscal year, the Commission shall continue to collect fees (as
offsetting collections) under this section at the rate in effect during
the preceding fiscal year (prior to adjustments, if any, under
subsections (b) and (c) of section 5 of the Competitive Market
Supervision Act), until such a regular appropriation is enacted.'';
(2) in subsection (e), by striking ``subsections (b), (c),
and (d)'' and inserting ``subsection (b)''; and
(3) in subsection (g), by striking ``rates'' and inserting
``rate''.
SEC. 5. ADJUSTMENTS TO FEE RATES.
(a) Estimates of Collections.--
(1) Fee projections.--The Securities and Exchange
Commission (hereafter in this Act referred to as the
``Commission'') shall, 1 month after submission of its initial
report under subsection (e)(1) and on a monthly basis
thereafter, project the aggregate amount of fees from all
sources likely to be collected by the Commission during the
current fiscal year.
(2) Submission of information.--Each national securities
exchange and national securities association shall file with
the Commission, not later than 10 days after the end of each
month--
(A) an estimate of the fee required to be paid
pursuant to section 31 of the Securities Exchange Act
of 1934 by such national securities exchange or
national securities association for transactions and
sales occurring during such month; and
(B) such other information and documents as the
Commission may require, as necessary or appropriate to
project the aggregate amount of fees pursuant to
paragraph (1).
(b) Floor for Total Fee Collections.--If, at any time after the end
of the first half of the fiscal year, the Commission projects under
subsection (a) that the aggregate amount of fees collected by the
Commission will, during that fiscal year, fall below an amount equal to
the floor for total fee collections, the Commission may by order,
subject to subsection (e), increase the fee rate established under
section 31 of the Securities Exchange Act of 1934 to the extent
necessary to bring estimated collections to an amount equal to the
floor for total fee collections. Such increase shall apply only to
transactions and sales occurring on or after the effective date
specified in such order through August 31 of that fiscal year. Such
increase shall not affect the obligation of each national securities
exchange and national securities association to pay the Commission the
fee required by section 31 of the Securities Exchange Act of 1934 at
the fee rate in effect prior to the effective date of such order for
transactions and sales occurring prior to the effective date of such
order. 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.
(c) Cap on Total Fee Collections.--If, at any time after the end of
the first half of the fiscal year, the Commission projects under
subsection (a) that the aggregate amount of fees collected by the
Commission will exceed the cap on total fee collections by more than 5
percent during any fiscal year, the Commission shall by order, subject
to subsection (e), decrease the fee rate or suspend collection of fees
under section 31 of the Securities Exchange Act of 1934 to the extent
necessary to bring estimated collections to an amount equal to the cap
on total fee collections. Such decrease or suspension shall apply only
to transactions and sales occurring on or after the effective date
specified in such order through August 31 of that fiscal year. Such
decrease or suspension shall not affect the obligation of each national
securities exchange and national securities association to pay the
Commission the fee required by section 31 of the Securities Exchange
Act of 1934 at the fee rate in effect prior to the effective date of
such order for transactions and sales occurring prior to the effective
date of such order. 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.
(d) Definitions.--For purposes of this section--
(1) the term ``floor for total fee collections'' means the
greater of--
(A) the total amount appropriated to the Commission
for fiscal year 2002 (adjusted annually, based on the
annual percentage change, if any, in the Consumer Price
Index for all urban consumers, as published by the
Department of Labor); or
(B) the amount authorized for the Commission
pursuant to section 35 of the Securities Exchange Act
of 1934 (15 U.S.C. 78kk), if applicable; and
(2) the term ``cap on total fee collections'' means--
(A) for fiscal years 2002 through 2010, the
baseline amount for aggregate offsetting collections
for such fiscal year under section 6(b) of the
Securities Act of 1933 and section 31 of the Securities
Exchange Act of 1934, as projected for such fiscal year
by the Congressional Budget Office pursuant to section
257 of the Balanced Budget and Emergency Deficit
Control Act of 1985 in its most recently published
report of its baseline projection before the date of
enactment of this Act; and
(B) for fiscal years 2011 and thereafter, the
amount authorized for the Commission pursuant to
section 35 of the Securities Exchange Act of 1934 (15
U.S.C. 78kk).
(e) Reports to Congress; Judicial Review; Notice.--
(1) Initial report.--Not later than 90 days after the date
of enactment of this Act, the Commission shall report to the
Committee on Banking, Housing, and Urban Affairs of the Senate
and the Committee on Financial Services of the House of
Representatives to explain the methodology used by the
Commission to make projections under subsection (a). Not later
than 30 days after the beginning of each fiscal year, the
Commission may report to the Committee on Banking, Housing, and
Urban Affairs of the Senate and the Committee on Financial
Services of the House of Representatives on revisions to the
methodology used by the Commission to make projections under
subsection (a) for such fiscal year and subsequent fiscal
years.
(2) Judicial review; reports of intent to act.--The
determinations made and the actions taken by the Commission
under this subsection shall not be subject to judicial review.
Not later than 45 days before taking action under subsection
(b) or (c), the Commission shall report to the Committee on
Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of Representatives
on its intent to take such action.
(3) Notice.--Not later than 30 days before taking action
under subsection (b) or (c), the Commission shall notify each
national securities exchange and national securities
association of its intent to take such action.
SEC. 6. COMPARABILITY PROVISIONS.
(a) Securities and Exchange Commission Employees.--
(1) In general.--Section 4(b) of the Securities Exchange
Act of 1934 (15 U.S.C. 78d(b)) is amended--
(A) by striking paragraphs (1) and (2) and
inserting the following:
``(1) Appointment and compensation.--
``(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) Comparability.--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(a) 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(a) of the Financial Institutions
Reform, Recovery, and Enforcement Act of 1989 (12
U.S.C. 1833b).''; and
(B) by redesignating paragraph (3) as paragraph
(2).
(2) Employees represented by labor organizations.--To the
extent that any employee of the 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 subsection.
(b) Reporting on Information by the Commission.--Section 1206 of
the Financial Institutions Reform, Recovery, and Enforcement Act of
1989 (12 U.S.C. 1833b) is amended--
(1) by inserting ``(a) In General.--'' before ``The Federal
Deposit'';
(2) by striking ``the Thrift Depositor Protection Oversight
Board of the Resolution Trust Corporation''; and
(3) by adding at the end the following:
``(b) In establishing and adjusting schedules of compensation and
benefits for employees of the Securities and Exchange Commission under
applicable provisions of law, the Commission shall inform the heads of
the agencies referred to under subsection (a) and Congress of such
compensation and benefits and shall seek to maintain comparability with
such agencies regarding compensation and benefits.''.
(c) 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 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. 7. EFFECTIVE DATE.
(a) In General.--Subject to subsection (b), this Act and the
amendments made by this Act shall become effective on October 1, 2001.
(b) Exceptions.--The authorities provided by section 13(e)(3)(D),
section 14(g)(1)(D), section 14(g)(3)(D), and section 31(d) of the
Securities Exchange Act of 1934, as so designated by this Act, shall
not apply until October 1, 2002.
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