[Congressional Record (Bound Edition), Volume 152 (2006), Part 14]
[Senate]
[Pages 19147-19148]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           TEXT OF AMENDMENTS

  SA 5035. Mr. McCONNELL (for Mr. Shelby (for himself and Mr. 
Sarbanes)) proposed an amendment to the bill S. 3850, to improve 
ratings quality for the protection of investors and in the public 
interest by fostering accountability, transparency, and competition in 
the credit rating agency industry; as follows:

       On page 8, line 23, insert before the semicolon ``, except 
     as provided in subparagraph (D)''.
       On page 10, line 3, strike ``(D)'' and insert ``(E)''.
       On page 10, between lines 2 and 3, insert the following:
       ``(D) Exemption from certification requirement.--A written 
     certification under subparagraph (B)(ix) is not required with 
     respect to any credit rating agency which has received, or 
     been the subject of, a non-action letter from the staff of 
     the Commission prior to August 2, 2006, stating that such 
     staff would not recommend enforcement action against any 
     broker or dealer that considers credit ratings issued by such 
     credit rating agency to be ratings from a nationally 
     recognized statistical rating organization.''.
       On page 14, line 15, strike ``the authority'' and insert 
     ``exclusive authority''.
       On page 15, line 11, strike ``organizations,'' and all that 
     follows through line 15 and insert the following: 
     ``organizations. Notwithstanding any other provision of law, 
     neither the Commission nor any State (or political 
     subdivision thereof) may regulate the substance of credit 
     ratings or the procedures and methodologies by which any 
     nationally recognized statistical rating organization 
     determines credit ratings.''.
       On page 27, between lines 5 and 6, insert the following:
       ``(o) NRSROs Subject to Commission Authority.--
       ``(1) In general.--No provision of the laws of any State or 
     political subdivision thereof requiring the registration, 
     licensing, or qualification as a credit rating agency or a 
     nationally recognized statistical rating organization shall 
     apply to any nationally recognized statistical rating 
     organization or person employed by or working under the 
     control of a nationally recognized statistical rating 
     organization.
       ``(2) Limitation.--Nothing in this subsection prohibits the 
     securities commission (or any agency or office performing 
     like functions) of any State from investigating and bringing 
     an enforcement action with respect to fraud or deceit against 
     any nationally recognized statistical rating organization or 
     person associated with a nationally recognized statistical 
     rating organization.''.
       On page 27, line 6, strike ``(o)'' and insert ``(p)''.
       On page 27, strike lines 6 and 7, and insert the following:
       ``(p) Applicability.--This section, other than subsection 
     (n), which shall apply on the date of enactment of this 
     section, shall apply on the earlier of--''.
       On page 28, line 25, strike ``and'' and all that follows 
     through ``(B) in'' on page 29, line 1, and insert the 
     following:
       ``(B) in section 202(a)(11) (15 U.S.C. 80b-2(a)(11)), by 
     striking `or (F)' and inserting the following: `(F) any 
     nationally recognized statistical rating organization, as 
     that term is defined in section 3(a)(62) of the Securities 
     Exchange Act of 1934, unless such organization engages in 
     issuing recommendations as to purchasing, selling, or holding 
     securities

[[Page 19148]]

     or in managing assets, consisting in whole or in part of 
     securities, on behalf of others; or (G)'; and
       ``(C) in''.
       On page 33, strike lines 1 through 5.

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