[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[S. 1802 Introduced in Senate (IS)]

114th CONGRESS
  1st Session
                                S. 1802

To protect the investment choices of American investors, and for other 
                               purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 16, 2015

  Mr. Toomey (for himself, Mr. Manchin, Mr. Crapo, and Mr. Menendez) 
introduced the following bill; which was read twice and referred to the 
            Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
To protect the investment choices of American investors, 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 ``Consumer Financial Choice and 
Capital Markets Protection Act of 2015''.

SEC. 2. TREATMENT OF MONEY MARKET FUNDS UNDER THE INVESTMENT COMPANY 
              ACT OF 1940.

    The Investment Company Act of 1940 (15 U.S.C. 80a et seq.) is 
amended by adding at the end the following:

``SEC. 66. MONEY MARKET FUNDS.

    ``(a) Election To Be Treated as Money Market Fund.--Notwithstanding 
any other provision of this title, any open-end investment company (or 
a separate series thereof) may elect, in its registration statement 
filed under section 8, to be a money market fund and may compute the 
current price per share, for purposes of distribution or redemption and 
repurchase, of any redeemable security issued by the company using the 
amortized cost method of valuation, or the penny-rounding method of 
pricing, regardless of whether its shareholders are limited to natural 
persons, if--
            ``(1) the company or series has as its objective the 
        generation of income and preservation of capital through 
        investment in short-term, high-quality debt securities;
            ``(2) if the company or series elects to maintain a stable 
        net asset value per share or stable price per share, by virtue 
        of the amortized cost valuation method, as that term is defined 
        in section 270.2a-7(a)(2) of title 17, Code of Federal 
        Regulations, as in effect on the date of enactment of this 
        section, and in accordance with the requirements specified with 
        respect to the use of the amortized cost valuation method as 
        set forth in that section, as in effect on the date of 
        enactment of this section, or the penny-rounding pricing 
        method, as that term is defined in section 270.2a-7(a)(21) of 
        title 17, Code of Federal Regulations, as in effect on the date 
        of enactment of this section, and in accordance with the 
        requirements specified with respect to the use of the penny-
        rounding pricing method as set forth in that section, as in 
        effect on the date of enactment of this section, the board of 
        directors of the company has determined, in good faith, that--
                    ``(A) it is in the best interests of the company or 
                series, and its shareholders, to do so; and
                    ``(B) the money market fund will continue to use 
                such method or methods only as long as the board of 
                directors believes that the resulting share price 
                fairly reflects the market-based net asset value per 
                share of the company or series; and
            ``(3) the company or series agrees to comply with such 
        quality, maturity, diversification, and liquidity requirements, 
        including reasonable procedural and recordkeeping requirements 
        and provisions relating to liquidity fees and restrictions on 
        redemptions, as the Commission, by rule or regulation or order, 
        may prescribe or has prescribed as necessary or appropriate in 
        the public interest or for the protection of investors to the 
        extent that such requirements and provisions are not 
        inconsistent with this section.
    ``(b) Prohibition Against Federal Government Bailouts of Money 
Market Funds.--
            ``(1) Definitions.--In this subsection--
                    ``(A) the term `covered Federal assistance' means 
                Federal assistance used for the purpose of--
                            ``(i) making any loan to, or purchasing any 
                        stock, equity interest, or debt obligation of, 
                        any money market fund;
                            ``(ii) guaranteeing any loan or debt 
                        issuance of any money market fund; or
                            ``(iii) entering into any assistance 
                        arrangement (including tax breaks), loss 
                        sharing, or profit sharing with any money 
                        market fund; and
                    ``(B) the term `Federal assistance' means--
                            ``(i) insurance or guarantees by the 
                        Federal Deposit Insurance Corporation;
                            ``(ii) transactions involving the Secretary 
                        of the Treasury; or
                            ``(iii) the use of any advances from any 
                        Federal Reserve credit facility or discount 
                        window that is not part of a program or 
                        facility with broad-based eligibility 
                        established in unusual or exigent 
                        circumstances.
            ``(2) Prohibition.--Notwithstanding any other provision of 
        law (including regulations), covered Federal assistance may not 
        be provided directly to any money market fund.
    ``(c) Disclosure of the Prohibition Against Federal Government 
Bailouts of Money Market Funds.--No principal underwriter of a 
redeemable security issued by a money market fund nor any dealer shall 
offer or sell any such security to any person unless the prospectus of 
the money market fund and any advertising or sales literature for such 
fund prominently discloses the prohibition against direct covered 
Federal assistance as described in subsection (b). The Commission may, 
after consultation with and taking into account the views of the Board 
of Governors of the Federal Reserve System, the Federal Deposit 
Insurance Corporation, and the Department of the Treasury, adopt rules 
and regulations, and issue orders consistent with the protection of 
investors, prescribing the manner in which the disclosure under this 
subsection shall be provided.
    ``(d) Continuing Obligation To Meet Requirements of This Title.--A 
company that elects to be a money market fund in accordance with 
subsection (a) or is otherwise a money market fund operating in 
accordance with the rules and regulations of the Commission applicable 
to money market funds shall remain subject to the provisions of this 
title and the rules and regulations of the Commission thereunder that 
would otherwise apply to a registered open-end company, as long as 
those provisions do not conflict with the provisions of this 
section.''.
                                 <all>