[House Report 105-794]
[From the U.S. Government Publishing Office]



105th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     105-794
_______________________________________________________________________


 
                     BANKRUPTCY REFORM ACT OF 1998

                                _______
                                

                October 7, 1998.--Ordered to be printed

_______________________________________________________________________


  Mr. Hyde, from the committee of conference, submitted the following

                           CONFERENCE REPORT

                        [To accompany H.R. 3150]

      The committee of conference on the disagreeing votes of 
the two Houses on the amendment of the Senate to the bill (H.R. 
3150), to amend title 11 of the United States Code, and for 
other purposes, having met, after full and free conference, 
have agreed to recommend and do recommend to their respective 
Houses as follows:
      That the House recede from its disagreement to the 
amendment of the Senate and agree to the same with an amendment 
as follows:
      In lieu of the matter proposed to be inserted by the 
Senate amendment, insert the following:

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Bankruptcy 
Reform Act of 1998''.
    (b) Table of Contents.--The table of contents of this Act 
is as follows:

Sec. 1. Short title; table of contents.

                 TITLE I--CONSUMER BANKRUPTCY PROVISIONS

                   Subtitle A--Needs based bankruptcy

Sec. 101. Conversion.
Sec. 102. Dismissal or conversion.
Sec. 103. Notice of alternatives.
Sec. 104. Debtor financial management training test program.

               Subtitle B--Consumer Bankruptcy Protections

Sec. 105. Definitions.
Sec. 106. Disclosures.
Sec. 107. Debtor's bill of rights.
Sec. 108. Enforcement.
Sec. 109. Sense of the congress.
Sec. 110. Discouraging abuse reaffirmation practices.
Sec. 111. Promotion alternative dispute resolution.
Sec. 112. Enhanced disclosure for credit extensions secured by a 
          dwelling.
Sec. 113. Dual use debit card.
Sec. 114. Enhanced disclosures under an open-end credit plan.
Sec. 115. Protection of savings earmarked for the postsecondary 
          education of children.
Sec. 116. Effect of discharge.
Sec. 117. Automatic stay.
Sec. 118. Reinforce the fresh start.
Sec. 119. Discouraging bad faith repeat filings.
Sec. 120. Curbing abusive filings.
Sec. 121. Debtor retention of personal property security.
Sec. 122. Relief from the automatic stay when the debtor does not 
          complete intended surrender of consumer debt collateral.
Sec. 123. Giving secured creditors fair treatment in chapter 13.
Sec. 124. Restraining abusive purchases on secured credit.
Sec. 125. Fair valuation of collateral.
Sec. 126. Exemptions.
Sec. 127. Limitation.
Sec. 128. Rolling stock equipment.
Sec. 129. Discharge under chapter 13.
Sec. 130. Bankruptcy judgeships.
Sec. 131. Additional amendments to title 11, United States code.
Sec. 132. Amendment to section 1325 of title 11, United States code.
Sec. 133. Application of the codebtor stay only when the stay protects 
          the debtor.
Sec. 134. Adequate protection for investors.
Sec. 135. Limitation on luxury goods.
Sec. 136. Giving debtors the ability to keep leased personal property by 
          assumption.
Sec. 137. Adequate protection of lessors and purchase money secured 
          creditors.
Sec. 139. Automatic stay.
Sec. 140. Extend period between bankruptcy discharges.
Sec. 141. Definition of domestic support obligation.
Sec. 142. Priorities for claims for domestic support obligations.
Sec. 143. Requirements to obtain confirmation and discharge in cases 
          involving domestic support obligations.
Sec. 144. Exceptions to automatic stay in domestic support obligation 
          proceedings.
Sec. 145. Nondischargeability of certain debts for alimony, maintenance, 
          and support.
Sec. 146. Continued liability of property.
Sec. 147. Protection of domestic support claims against preferential 
          transfer motions.
Sec. 148. Definition of household goods and antiques.
Sec. 149. Nondischargeable debts.

                 TITLE II--DISCOURAGING BANKRUPTCY ABUSE

Sec. 201. Reenactment of chapter 12.
Sec. 202. Meetings of creditors and equity security holders.
Sec. 203. Protection of retirement savings in bankruptcy.
Sec. 204. Protection of refinance of security interest.
Sec. 205. Executory contracts and unexpired leases.
Sec. 206. Creditors and equity security holders committees.
Sec. 207. Amendment to section 546 of title 11, United States code.
Sec. 208. Limitation.
Sec. 209. Amendment to section 330(a) of title 11, United States code.
Sec. 210. Postpetition disclosure and solicitation.
Sec. 211. Preferences.
Sec. 212. Venue of certain proceedings.
Sec. 213. Period for filing plan under chapter 11.
Sec. 214. Fees arising from certain ownership interests.
Sec. 215. Claims relating to insurance deposits in cases ancillary to 
          foreign proceedings.
Sec. 216. Defaults based on nonmonetary obligations.

            TITLE III--GENERAL BUSINESS BANKRUPTCY PROVISIONS

Sec. 301. Definition of disinterested person.
Sec. 302. Miscellaneous improvements.

             TITLE IV--SMALL BUSINESS BANKRUPTCY PROVISIONS

Sec. 401. Flexible rules for disclosure Statement and plan.
Sec. 402. Definitions.
Sec. 403. Standard form disclosure Statement and plan.
Sec. 404. Uniform national reporting requirements.
Sec. 405. Uniform reporting rules and forms for small business cases.
Sec. 406. Duties in small business cases.
Sec. 407. Plan filing and confirmation deadlines.
Sec. 408. Plan confirmation deadline.
Sec. 409. Prohibition against extension of time.
Sec. 410. Duties of the United States trustee.
Sec. 411. Scheduling conferences.
Sec. 412. Serial filer provisions.
Sec. 413. Expanded grounds for dismissal or conversion and appointment 
          of trustee.
Sec. 414. Study of operation of title 11 of the United States code with 
          respect to small businesses.
Sec. 415. Payment of interest.

                TITLE V--MUNICIPAL BANKRUPTCY PROVISIONS

Sec. 501. Petition and proceedings related to petition.
Sec. 502. Applicability of other sections to chapter 9.

              TITLE VI--STREAMLINING THE BANKRUPTCY SYSTEM

Sec. 601. Creditor representation at first meeting of creditors.
Sec. 602. Audit procedures.
Sec. 603. Giving creditors fair notice in chapter 7 and 13 cases.
Sec. 604. Dismissal for failure to timely file schedules or provide 
          required information.
Sec. 605. Adequate time to prepare for hearing on confirmation of the 
          plan.
Sec. 606. Chapter 13 plans to have a 5-year duration in certain cases.
Sec. 607. Sense of the Congress regarding expansion of rule 9011 of the 
          Federal rules of bankruptcy procedure.
Sec. 608. Elimination of certain fees payable in chapter 11 bankruptcy 
          cases.
Sec. 609. Study of bankruptcy impact of credit extended to dependent 
          students.
Sec. 610. Prompt relief from stay in individual cases.
Sec. 611. Stopping abusive conversions from chapter 13.

                       TITLE VII--BANKRUPTCY DATA

Sec. 701. Improved bankruptcy statistics.
Sec. 702. Uniform rules for the collection of bankruptcy data.
Sec. 703. Sense of the Congress regarding availability of bankruptcy 
          data.

                  TITLE VIII--BANKRUPTCY TAX PROVISIONS

Sec. 801. Treatment of certain liens.
Sec. 802. Effective notice to government.
Sec. 803. Notice of request for a determination of taxes.
Sec. 804. Rate of interest on tax claims.
Sec. 805. Tolling of priority of tax claim time periods.
Sec. 806. Priority property taxes incurred.
Sec. 807. Chapter 13 discharge of fraudulent and other taxes.
Sec. 808. Chapter 11 discharge of fraudulent taxes.
Sec. 809. Stay of tax proceedings.
Sec. 810. Periodic payment of taxes in chapter 11 cases.
Sec. 811. Avoidance of statutory tax liens prohibited.
Sec. 812. Payment of taxes in the conduct of business.
Sec. 813. Tardily filed priority tax claims.
Sec. 814. Income tax returns prepared by tax authorities.
Sec. 815. Discharge of the estate's liability for unpaid taxes.
Sec. 816. Requirement to file tax returns to confirm chapter 13 plans.
Sec. 817. Standards for tax disclosure.
Sec. 818. Setoff of tax refunds.

            TITLE IX--ANCILLARY AND OTHER CROSS-BORDER CASES

Sec. 901. Amendment to add chapter 15 to title 11, United States code.
Sec. 902. Amendments to other chapters in title 11, United States code.

                 TITLE X--FINANCIAL CONTRACT PROVISIONS

Sec. 1001. Treatment of certain agreements by conservators or receivers 
          of insured depository institutions.
Sec. 1002. Authority of the corporation with respect to failed and 
          failing institutions.
Sec. 1003. Amendments relating to transfers of qualified financial 
          contracts.
Sec. 1004. Amendments relating to disaffirmance or repudiation of 
          qualified financial contracts.
Sec. 1005. Clarifying amendment relating to master agreements.
Sec. 1006. Federal deposit insurance corporation improvement act of 
          1991.
Sec. 1007. Bankruptcy code amendments.
Sec. 1008. Recordkeeping requirements.
Sec. 1009. Exemptions from contemporaneous execution requirement.
Sec. 1010. Damage measure.
Sec. 1011. SIPC stay.
Sec. 1012. Asset-backed securitizations.
Sec. 1013. Federal reserve collateral requirements.
Sec. 1014. Severability; effective date; application of amendments.

                     TITLE XI--TECHNICAL CORRECTIONS

Sec. 1101. Definitions.
Sec. 1102. Adjustment of dollar amounts.
Sec. 1103. Extension of time.
Sec. 1104. Technical amendments.
Sec. 1105. Penalty for persons who negligently or fraudulently prepare 
          bankruptcy petitions.
Sec. 1106. Limitation on compensation of professional persons.
Sec. 1107. Special tax provisions.
Sec. 1108. Effect of conversion.
Sec. 1109. Amendment to table of sections.
Sec. 1110. Allowance of administrative expenses.
Sec. 1111. Priorities.
Sec. 1112. Exemptions.
Sec. 1113. Exceptions to discharge.
Sec. 1114. Effect of discharge.
Sec. 1115. Protection against discriminatory treatment.
Sec. 1116. Property of the estate.
Sec. 1117. Preferences.
Sec. 1118. Postpetition transactions.
Sec. 1119. Disposition of property of the estate.
Sec. 1120. General provisions.
Sec. 1121. Appointment of elected trustee.
Sec. 1122. Abandonment of railroad line.
Sec. 1123. Contents of plan.
Sec. 1124. Discharge under chapter 12.
Sec. 1125. Bankruptcy cases and proceedings.
Sec. 1126. Knowing disregard of bankruptcy law or rule.
Sec. 1127. Transfers made by nonprofit charitable corporations.
Sec. 1128. Prohibition on certain actions for failure to incur finance 
          charges.
Sec. 1129. Protection of valid purchase money security interests.
Sec. 1130. Trustees.

      TITLE XII--GENERAL EFFECTIVE DATE; APPLICATION OF AMENDMENTS

Sec. 1201. Effective date; application of amendments.

                TITLE I--CONSUMER BANKRUPTCY PROVISIONS

                   Subtitle A--Needs based bankruptcy

SEC. 101. CONVERSION.

    Section 706(c) of title 11, United States Code, is amended 
by inserting ``or consents to'' after ``requests''.

SEC. 102. DISMISSAL OR CONVERSION.

    (a) In General.--Section 707 of title 11, United States 
Code, is amended--
            (1) by striking the section heading and inserting 
        the following:

``Sec. 707. Dismissal of a case or conversion to a case under chapter 
                    13'';

        and
            (2) in subsection (b)--
                    (A) by inserting ``(1)'' after ``(b)''; and
                    (B) in paragraph (1), as redesignated by 
                subparagraph (A) of this paragraph--
                            (i) in the first sentence--
                                    (I) by striking ``but not 
                                at the request or suggestion'' 
                                and inserting ``, panel trustee 
                                or'';
                                    (II) by inserting ``, or, 
                                with the debtor's consent, 
                                convert such a case to a case 
                                under chapter 13 of this 
                                title,'' after ``consumer 
                                debts''; and
                                    (III) by striking 
                                ``substantial abuse'' and 
                                inserting ``abuse''; and
                            (ii) by striking the last sentence 
                        and inserting the following:
    ``(2)(A)(i) In considering under paragraph (1) whether the 
granting of relief would be an abuse of the provisions of this 
chapter, the court shall presume abuse exists if the debtor's 
current monthly income less amounts set forth in clauses (ii), 
(iii), and (iv), and multiplied by 60 months is not less than 
25 percent of the debtor's nonpriority unsecured claims in the 
case or $5,000, whichever is less.
    ``(ii) The debtor's monthly expenses shall be the 
applicable monthly expenses under National Standards, Local 
Standards, and Other Necessary Expenses allowance (excluding 
payments for debts) issued by the Internal Revenue Service for 
the area in which the debtor resides, as in effect on the date 
of the entry of the order for relief, for the debtor, the 
dependents of the debtor, and the spouse of the debtor in a 
joint case, if the spouse is not otherwise a dependent.
    ``(iii) The debtor's average monthly payments on account of 
secured debts shall be calculated as the total of all amounts 
scheduled as contractually due to secured creditors in each 
month of the 60 months following the date of the petition, and 
dividing that total by 60 months.
    ``(iv) The debtor's expenses for payment of all priority 
claims (including priority child support and alimony claims), 
which shall be calculated as the total amount of debts entitled 
to priority, and dividing the total by 60 months.
    ``(B) In any proceeding brought under this subsection, the 
presumption of abuse may be rebutted only by demonstrating 
extraordinary circumstances that require additional expenses or 
adjustment of current monthly total income. In order to 
establish extraordinary circumstances, the debtor must itemize 
each additional expense or adjustment of income and provide 
documentation for such expenses and a detailed explanation of 
the extraordinary circumstances which make such expenses 
necessary and reasonable. The debtor, and the attorney for the 
debtor if the debtor has an attorney, shall attest under oath 
to the accuracy of any information provided to demonstrate that 
additional expenses or adjustment to income are required. The 
presumption of abuse may be rebutted only if such additional 
expenses or adjustments to income cause the debtor's current 
monthly income less the amounts set forth in clauses (ii), 
(iii), and (iv) of subparagraph (A) when multiplied by 60 to be 
less than 25 percent of the debtor's nonpriority unsecured 
claims $5,000, whichever is less.
    ``(C) As part of the schedule of current income and 
expenditures required under section 521 of this title, the 
debtor shall include a statement of the debtor's current 
monthly income, and the calculations which determine whether a 
presumption arises under subparagraph (A)(i), showing how each 
amount is calculated. The bankruptcy rules promulgated under 
section 2075 of title 28, United States Code, shall prescribe a 
form for such statement and may provide general rules on its 
content.
    ``(3) In considering under paragraph (1) whether the 
granting of relief would be an abuse of the provisions of this 
chapter in a case in which the presumption in subparagraph 
(A)(i) does not apply or has been rebutted, the court shall 
consider--
            ``(A) whether the debtor filed the petition in bad 
        faith; or
            ``(B) the totality of the circumstances (including 
        whether the debtor seeks to reject a personal services 
        contract and the financial need for such rejection as 
        sought by the debtor) of the debtor's financial 
        situation demonstrates abuse.''.
    (b) Definition.--Title 11, United States Code, is amended--
            (1) in section 101 by inserting after paragraph 
        (10) the following:
            ``(10A) `currently monthly income' means the 
        average monthly income from all sources derived which 
        the debtor, or in a joint case, the debtor and the 
        debtor's spouse, receive without regard to whether it 
        is taxable income, in the 180 days preceding the date 
        of determination, and includes any amount paid by 
        anyone other than the debtor or, in a joint case, the 
        debtor and the debtor's spouse, on a regular basis to 
        the household expenses of the debtor or the debtor's 
        dependents and, in a joint case, the debtor's spouse if 
        not otherwise a dependent;''; and
            (2) in section 704--
                    (i) in paragraph (8) by striking ``and'' at 
                the end;
                    (ii) in paragraph (9) by striking the 
                period at the end and inserting ``; and''; and
                    (iii) by adding at the end the following:
    ``(10) With respect to an individual debtor under this 
chapter, the panel trustee or bankruptcy administrator shall 
review all materials filed by the debtor and, 10 days prior to 
the first meeting of creditors, file with the court a statement 
as to whether the debtor's case would be presumed to be an 
abuse under section 707(b) of this title, and the court shall 
provide a copy of such statement to all creditors within 5 
days. If, based on the filing of such statement with the court, 
the panel trustee or bankruptcy administrator determines that 
the debtor's case should be presumed to be an abuse under 
section 707(b) of this title and the debtor's current monthly 
income, when multiplied by 12, is not less than the highest 
national median family income reported for a family of equal or 
lesser size, or in the case of a household of 1 person, the 
national median household income for 1 earner, the panel 
trustee or bankruptcy administrator shall within 30 days file a 
motion to dismiss or convert under section 707(b) of this 
title, or file a statement setting forth the reasons the 
trustee does not believe that such a motion would be 
appropriate.
    ``(3)(A) If a panel trustee appointed under section 
586(a)(1) of title 28 brings a motion for dismissal or 
conversion under this subsection and the court grants that 
motion and finds that the action of the counsel for the debtor 
in filing under this chapter was not substantially justified, 
the court shall order the counsel for the debtor to reimburse 
the trustee for all reasonable costs in prosecuting the motion, 
including reasonable attorneys' fees.
    ``(B) If the court finds that the attorney for the debtor 
violated Rule 9011, at a minimum, the court shall order--
            ``(i) the assessment of an appropriate civil 
        penalty against the counsel for the debtor; and
            ``(ii) the payment of the civil penalty to the 
        panel trustee or the United States trustee.
    ``(C) In the case of a petition referred to in subparagraph 
(B), the signature of an attorney shall constitute a 
certificate that the attorney has--
            ``(i) performed a reasonable investigation into the 
        circumstances that gave rise to the petition; and
            ``(ii) determined that the petition--
                    ``(I) is well grounded in fact; and
                    ``(II) is warranted by existing law or a 
                good faith argument for the extension, 
                modification, or reversal of existing law and 
                does not constitute an abuse under paragraph 
                (1) of this subsection.
    ``(4)(A) Except as provided in subparagraph (B), the court 
may award a debtor all reasonable costs in contesting a motion 
brought by a party in interest (other than a panel trustee or 
United States trustee) under this subsection (including 
reasonable attorneys' fees) if--
            ``(i) the court does not grant the motion; and
            ``(ii) the court finds that--
                    ``(I) the position of the party that 
                brought the motion was not substantially 
                justified; or
                    ``(II) the party brought the motion solely 
                for the purpose of coercing a debtor into 
                waiving a right guaranteed to the debtor under 
                this title.
    ``(B) A party in interest that has a claim of an aggregate 
amount less than $1,000 shall not be subject to subparagraph 
(A).
    ``(5) However, only the judge, United States trustee, 
bankruptcy administrator or panel trustee may bring a motion 
under this section if the debtor and the debtor's spouse 
combined, as of the date of the order for relief, have current 
monthly total income equal to or less than the national median 
household monthly income calculated on a monthly basis for a 
household of equal size. However, for a household of more than 
4 individuals, the median income shall be that of a household 
of 4 individuals plus $583 for each additional member of that 
household.''.
    (c) Clerical Amendment.--The table of sections at the 
beginning of chapter 7 of title 11, United States Code, is 
amended by striking the item relating to section 707 and 
inserting the following:

``707. Dismissal of a case or conversion to a case under chapter 13.''.

SEC. 103. NOTICE OF ALTERNATIVES.

    Section 342(b) of title 11, United States Code, is amended 
to read as follows:
    ``(b) Before the commencement of a case under this title by 
an individual whose debts are primarily consumer debts, that 
individual shall be given or obtain (as required in section 
521(a)(1), as part of the certification process under 
subchapter 1 of chapter 5) a written notice prescribed by the 
United States trustee for the district in which the petition is 
filed pursuant to section 586 of title 28. The notice shall 
contain the following:
            ``(1) A brief description of chapters 7, 11, 12, 
        and 13 and the general purpose, benefits, and costs of 
        proceeding under each of those chapters.
            ``(2) A brief description of services that may be 
        available to that individual from a credit counseling 
        service that is approved by the United States trustee 
        for that district.''.

SEC. 104. DEBTOR FINANCIAL MANAGEMENT TRAINING TEST PROGRAM.

    (a) Development of Financial Management and Training 
Curriculum and Materials.--The Director of the Executive Office 
for United States Trustees (in this section referred to as the 
``Director'') shall consult with a wide range of individuals 
who are experts in the field of debtor education, including 
trustees who are appointed under chapter 13 of title 11 of the 
United States Code and who operate financial management 
education programs for debtors, and shall develop a financial 
management training curriculum and materials that can be used 
to educate individual debtors on how to better manage their 
finances.
    (b) Test--(1) The Director shall select 3 judicial 
districts of the United States in which to test the 
effectiveness of the financial management training curriculum 
and materials developed under subsection (a).
    (2) For a 1-year period beginning not later than 270 days 
after the date of the enactment of this Act, such curriculum 
and materials shall be made available by the Director, directly 
or indirectly, on request to individual debtors in cases filed 
in such 1-year period under chapter 7 or 13 of title 11 of the 
United States Code.
    (c) Evaluation.--(1) During the 1-year period referred to 
in subsection (b), the Director shall evaluate the 
effectiveness of--
            (A) the financial management training curriculum 
        and materials developed under subsection (a); and
            (B) a sample of existing consumer education 
        programs such as those described in the Report of the 
        National Bankruptcy Review Commission (October 20, 
        1997) that are representative of consumer education 
        programs carried out by the credit industry, by 
        trustees serving under chapter 13 of title 11 of the 
        United States Code, and by consumer counselling groups.
    (2) Not later than 3 months after concluding such 
evaluation, the Director shall submit a report to the Speaker 
of the House of Representatives and the President pro tempore 
of the Senate, for referral to the appropriate committees of 
the Congress, containing the findings of the Director regarding 
the effectiveness of such curriculum, such materials, and such 
programs.

              Subtitle B--Consumer Bankruptcy Protections

SEC. 105. DEFINITIONS.

    (a) Definitions.--Section 101 of title 11, United States 
Code, is amended--
            (1) by inserting after paragraph (3) the following:
            ``(3A) `assisted person' means any person whose 
        debts consist primarily of consumer debts and whose 
        non-exempt assets are less than $150,000;'';
            (2) by inserting after paragraph (4) the following:
            ``(4A) `bankruptcy assistance' means any goods or 
        services sold or otherwise provided to an assisted 
        person with the express or implied purpose of providing 
        information, advice, counsel, document preparation or 
        filing, or attendance at a creditors' meeting or 
        appearing in a proceeding on behalf of another or 
        providing legal representation with respect to a 
        proceeding under this title;''; and
            (3) by inserting after paragraph (12A) the 
        following:
            ``(12B) `debt relief agency' means any person who 
        provides any bankruptcy assistance to an assisted 
        person in return for the payment of money or other 
        valuable consideration, or who is a bankruptcy petition 
        preparer pursuant to section 110 of this title, but 
        does not include any person that is any of the 
        following or an officer, director, employee or agent 
        thereof--
                    ``(A) any nonprofit organization which is 
                exempt from taxation under section 501(c)(3) of 
                the Internal Revenue Code of 1986;
                    ``(B) any creditor of the person to the 
                extent the creditor is assisting the person to 
                restructure any debt owed by the person to the 
                creditor; or
                    ``(C) any depository institution (as 
                defined in section 3 of the Federal Deposit 
                Insurance Act) or any Federal credit union or 
                State credit union (as those terms are defined 
                in section 101 of the Federal Credit Union 
                Act), or any affiliate or subsidiary of such a 
                depository institution or credit union;''.
    (b) Conforming Amendment.--In section 104(b)(1) by 
inserting ``101(3),'' after ``sections''.

SEC. 106. DISCLOSURES.

    (a) Disclosures.--Subchapter II of chapter 5 of title 11, 
United States Code, is amended by adding at the end the 
following:

``Sec. 526. Disclosures

    ``(a) A debt relief agency providing bankruptcy assistance 
to an assisted person shall provide the following notices to 
the assisted person:
            ``(1) the written notice required under section 
        342(b)(1) of this title; and
            ``(2) to the extent not covered in the written 
        notice described in paragraph (1) of this section and 
        no later than three business days after the first date 
        on which a debt relief agency first offers to provide 
        any bankruptcy assistance services to an assisted 
        person, a clear and conspicuous written notice advising 
        assisted persons of the following--
                    ``(A) all information the assisted person 
                is required to provide with a petition and 
                thereafter during a case under this title must 
                be complete, accurate and truthful;
                    ``(B) all assets and all liabilities must 
                be completely and accurately disclosed in the 
                documents filed to commence the case, and the 
                replacement value of each asset as defined in 
                section 506 of this title must be stated in 
                those documents where requested after 
                reasonable inquiry to establish such value;
                    ``(C) current monthly total income, 
                projected monthly net income and, in a chapter 
                13case, monthly net income must be stated after 
reasonable inquiry; and
                    ``(D) that information an assisted person 
                provides during their case may be audited 
                pursuant to this title and that failure to 
                provide such information may result in 
                dismissal of the proceeding under this title or 
                other sanction including, in some instances, 
                criminal sanctions.
    ``(b) A debt relief agency providing bankruptcy assistance 
to an assisted person shall provide each assisted person at the 
same time as the notices required under subsection (a)(1) with 
the following statement, to the extent applicable, or one 
substantially similar. The statement shall be clear and 
conspicuous and shall be in a single document separate from 
other documents or notices provided to the assisted person:
    `` `IMPORTANT INFORMATION ABOUT BANKRUPTCY ASSISTANCE 
SERVICES FROM AN ATTORNEY OR BANKRUPTCY PETITION PREPARER
    `` `If you decide to seek bankruptcy relief, you can 
represent yourself, you can hire an attorney to represent you, 
or you can get help in some localities from a bankruptcy 
petition preparer who is not an attorney. THE LAW REQUIRES AN 
ATTORNEY OR BANKRUPTCY PETITION PREPARER TO GIVE YOU A WRITTEN 
CONTRACT SPECIFYING WHAT THE ATTORNEY OR BANKRUPTCY PETITION 
PREPARER WILL DO FOR YOU AND HOW MUCH IT WILL COST. Ask to see 
the contract before you hire anyone.
    `` `The following information helps you understand what 
must be done in a routine bankruptcy case to help you evaluate 
how much service you need. Although bankruptcy can be complex, 
many cases are routine.
    `` `Before filing a bankruptcy case, either you or your 
attorney should analyze your eligibility for different forms of 
debt relief made available by the Bankruptcy Code and which 
form of relief is most likely to be beneficial for you. Be sure 
you understand the relief you can obtain and its limitations. 
To file a bankruptcy case, documents called a Petition, 
Schedules and Statement of Financial Affairs, as well as in 
some cases a Statement of Intention need to be prepared 
correctly and filed with the bankruptcy court. You will have to 
pay a filing fee to the bankruptcy court. Once your case 
starts, you will have to attend the required first meeting of 
creditors where you may be questioned by a court official 
called a ``trustee'' and by creditors.
    `` `If you choose to file a chapter 7 case, you may be 
asked by a creditor to reaffirm a debt. You may want help 
deciding whether to do so and a creditor is not permitted to 
coerce you into reaffirming your debts.
    `` `If you choose to file a chapter 13 case in which you 
repay your creditors what you can afford over three to five 
years, you may also want help with preparing your chapter 13 
plan and with the confirmation hearing on your plan which will 
be before a bankruptcy judge.
    `` `If you select another type of relief under the 
Bankruptcy Code other than chapter 7 or chapter 13, you will 
want to find out what needs to be done from someone familiar 
with that type of relief.
    `` `Your bankruptcy case may also involve litigation. You 
are generally permitted to represent yourself in litigation in 
bankruptcy court, but only attorneys, not bankruptcy petition 
preparers, can give you legal advice.'.
    ``(c) Except to the extent the debt relief agency provides 
the required information itself after reasonably diligent 
inquiry of the assisted person or others so as to obtain such 
information reasonably accurately for inclusion on the 
petition, schedules or statement of financial affairs, a debt 
relief agency providing bankruptcy assistance to an assisted 
person, to the extent permitted by nonbankruptcy law, shall 
provide each assisted person at the time required for the 
notice required under subsection (a)(1) reasonably sufficient 
information (which may be providedorally or in a clear and 
conspicuous writing) to the assisted person on how to provide all the 
information the assisted person is required to provide under this title 
pursuant to section 521, including--
            ``(1) how to value assets at replacement value, 
        determine current monthly total income, projected 
        monthly income and, in a chapter 13 case, net monthly 
        income, and related calculations;
            ``(2) how to complete the list of creditors, 
        including how to determine what amount is owed and what 
        address for the creditor should be shown; and
            ``(3) how to determine what property is exempt and 
        how to value exempt property at replacement value as 
        defined in section 506 of this title.
    ``(d) A debt relief agency shall maintain a copy of the 
notices required under subsection (a) of this section for two 
years after the later of the date on which the notice is given 
the assisted person.''.
    (b) Conforming Amendment.--The table of section for chapter 
5 of title 11, United States Code, is amended by inserting 
after the item relating to section 525 the following:

``526. Disclosures.''.

SEC. 107. DEBTOR'S BILL OF RIGHTS.

    (a) Debtor's Bill of Rights.--Subchapter II of chapter 5 of 
title 11, United States Code, as amended by section 106, is 
amended by adding at the end the following:

``Sec. 527. Debtor's bill of rights

    ``(a) A debt relief agency shall--
            ``(1) no later than five business days after the 
        first date on which a debt relief agency provides any 
        bankruptcy assistance services to an assisted person, 
        but prior to such assisted person's petition under this 
        title being filed, execute a written contract with the 
        assisted person specifying clearly and conspicuously 
        the services the agency will provide the assisted 
        person and the basis on which fees or charges will be 
        made for such services and the terms of payment, and 
        give the assisted person a copy of the fully executed 
        and completed contract in a form the person can keep;
            ``(2) disclose in any advertisement of bankruptcy 
        assistance services or of the benefits of bankruptcy 
        directed to the general public (whether in general 
        media, seminars or specific mailings, telephonic or 
        electronic messages or otherwise) that the services or 
        benefits are with respect to proceedings under this 
        title, clearly and conspicuously using the following 
        statement: `We are a debt relief agency. We help people 
        file Bankruptcy petitions to obtain relief under the 
        Bankruptcy Code.' or a substantially similar statement. 
        An advertisement shall be of bankruptcy assistance 
        services if it describes or offers bankruptcy 
        assistance with a chapter 13 plan, regardless of 
        whether chapter 13 is specifically mentioned, including 
        such statements as `federally supervised repayment 
        plan' or `Federal debt restructuring help' or other 
        similar statements which would lead a reasonable 
        consumer to believe that help with debts was being 
        offered when in fact in most cases the help available 
        is bankruptcy assistance with a chapter 13 plan; and
            ``(3) if an advertisement directed to the general 
        public indicates that the debt relief agency provides 
        assistance with respect to credit defaults, mortgage 
        foreclosures, lease eviction proceedings, excessive 
        debt, debt collection pressure, or inability to pay any 
        consumer debt, disclose conspicuously in that 
        advertisement that the assistance is with respect to or 
        may involve proceedings under this title, using the 
        following statement: ``We are a debt relief agency. We 
        help people file Bankruptcy petitions to obtain relief 
        under the Bankruptcy Code.'' or a substantially similar 
        statement.
    ``(b) A debt relief agency shall not--
            ``(1) fail to perform any service which the debt 
        relief agency has told the assisted person or 
        prospective assisted person the agency would provide 
        that person in connection with the preparation for or 
        activities during a proceeding under this title;
            ``(2) make any statement, or counsel or advise any 
        assisted person to make any statement in any document 
        filed in a proceeding under this title, which is untrue 
        and misleading or which upon the exercise of reasonable 
        care, should be known by the debt relief agency to be 
        untrue or misleading;
            ``(3) misrepresent to any assisted person or 
        prospective assisted person, directly or indirectly, 
        affirmatively or by material omission, what services 
        the debt relief agency can reasonably expect to provide 
        that person, or the benefits an assisted person may 
        obtain or the difficulties the person may experience if 
        the person seeks relief in a proceeding pursuant to 
        this title; or
            ``(4) advise an assisted person or prospective 
        assisted person to incur more debt in contemplation of 
        that person filing a proceeding under this title or in 
        order to pay an attorney or bankruptcy petition 
        preparer fee or charge for services performed as part 
        of preparing for or representing a debtor in a 
        proceeding under this title.''.
    (b) Conforming Amendment.--The table of section for chapter 
5 of title 11, United States Code, as amended by section 106, 
is amended by inserting after the item relating to section 526, 
the following:

``527. Debtor's bill of rights.''.

SEC. 108. ENFORCEMENT.

    (a) Enforcement.--Subchapter II of chapter 5 of title 11, 
United States Code, as amended by sections 106 and 107, is 
amended by adding at the end the following:

``Sec. 528. Debt relief agency enforcement

    ``(a) Assisted Person Waivers Invalid.--Any waiver by any 
assisted person of any protection or right provided by or under 
section 526 or 527 of this title shall be void and may not be 
enforced by any Federal or State court or any other person.
    ``(b) Noncompliance.--
            ``(1) Any contract between a debt relief agency and 
        an assisted person for bankruptcy assistance which does 
        not comply with the material requirements of section 
        526 or 527 of this title shall be treated as void and 
        may not be enforced by any Federal or State court or by 
        any other person.
            ``(2) Any debt relief agency which has been found, 
        after notice and hearing, to have--
                    ``(A) negligently failed to comply with any 
                provision of section 526 or 527 with respect to 
                a bankruptcy case or related proceeding of an 
                assisted person;
                    ``(B) provided bankruptcy assistance to an 
                assisted person in a case or related proceeding 
                which is dismissed or converted because the 
                debt relief agency's negligent failure to file 
                bankruptcy papers, including papers specified 
                in section 521 of this title; or
                    ``(C) negligently or intentionally 
                disregarded the material requirements of this 
                title or the Federal Rules of Bankruptcy 
                Procedure applicable to such debt relief agency 
                shall be liable to the assisted person in the 
                amount of any fees and charges in connection 
                with providing bankruptcy assistance to such 
                person which the debt relief agency has already 
                been paid on account of that proceeding.
            ``(3) In addition to such other remedies as are 
        provided under State law, whenever the chief law 
        enforcement officer of a State, or an official or 
        agency designated by a State, has reason to believe 
        that any person has violated or is violating section 
        526 or 527 of this title, the State--
                    ``(A) may bring an action to enjoin such 
                violation;
                    ``(B) may bring an action on behalf of its 
                residents to recover the actual damages of 
                assisted persons arising from such violation, 
                including any liability under paragraph (2); 
                and
                    ``(C) in the case of any successful action 
                under subparagraph (A) or (B), shall be awarded 
                the costs of the action and reasonable attorney 
                fees as determined by the court.
            ``(4) The United States District Court for any 
        district located in the State shall have concurrent 
        jurisdiction of any action under subparagraph (A) or 
        (B) of paragraph (3).
            ``(5) Notwithstanding any other provision of 
        Federal law, if the court, on its own motion or on the 
        motion of the United States trustee, finds that a 
        person intentionally violated section 526 or 527 of 
        this title, or engaged in a clear and consistent 
        pattern or practice of violating section 526 or 527 of 
        this title, the court may--
                    ``(A) enjoin the violation of such section; 
                or
                    ``(B) impose an appropriate civil penalty 
                against such person.
    ``(c) Relation to State Law.--This section and sections 526 
and 527 shall not annul, alter, affect or exempt any person 
subject to those sections from complying with any law of any 
State except to the extent that such law is inconsistent with 
those sections, and then only to the extent of the 
inconsistency.''.
    (b) Conforming Amendment.--The table of section for chapter 
5 of title 11, United States Code, as amended by sections 106 
and 107, is amended by inserting after the item relating to 
section 527, the following:

``528. Debt relief agency enforcement.''.

SEC. 109. SENSE OF THE CONGRESS.

    It is the sense of the Congress that States should develop 
curricula relating to the subject of personal finance, designed 
for use in elementary and secondary schools.

SEC. 110. DISCOURAGING ABUSE REAFFIRMATION PRACTICES.

    Section 524(c)(2) of title 11, United States Code, is 
amended--
            (1) in subparagraph (A) by striking ``and'' at the 
        end;
            (2) in subparagraph (B) by adding ``and'' at the 
        end; and
            (3) by adding at the end the following:
            ``(C) if the consideration for such agreement is 
        based on a wholly unsecured consumer debt, such 
        agreement contains a clear and conspicuous statement 
        which advises the debtor--
                    ``(i) that the debtor is entitled to a 
                hearing before the court at which the debtor 
                shall appear in person and at which the court 
                will decide whether the agreement is an undue 
                hardship, not in the debtor's best interest, 
                and not the result of a threat by the creditor 
                to take any action that cannot be legally taken 
                or that is not intended to be taken; and
                    ``(ii) that if the debtor is represented by 
                counsel, the debtor may waive the debtor's 
                right to such a hearing by signing a statement 
                waiving the hearing, stating that the debtor is 
                represented by counsel, and identifying such 
                counsel;'';
            (3) in subsection (6)(A)--
                    (A) by striking ``and'' at the end of 
                clause (i);
                    (B) by striking the period at the end of 
                clause (ii) and inserting ``; and'';
                    (C) by adding at the end thereof the 
                following:
                    ``(iii) not entered into by the debtor as 
                the result of a threat by the creditor to take 
                anyaction that cannot be legally taken or that 
is not intended to be taken.''; and
            (4) in the 3d sentence of subsection (d)--
                    (A) by striking ``of this section'' and 
                inserting a comma; and
                    (B) by inserting after ``such agreement'' 
                the following:

``or if the consideration for such agreement is based on a 
wholly unsecured consumer debt (except for debts owed to 
creditors defined in section 461(b)(10)(A)(iv) of title 12, 
United States Code) and the debtor has not waived the debtor's 
right to a hearing on the agreement in accordance with 
subsection (c)(2)(C) of this section''.

SEC. 111. PROMOTION ALTERNATIVE DISPUTE RESOLUTION.

    (a) Reduction of Claim.--Section 502 of title 11, United 
States Code, is amended by adding at the end the following:
    ``(k)(1) The court, on the motion of the debtor and after a 
hearing, may reduce a claim filed under this section based in 
whole on unsecured consumer debts by not more than 20 percent, 
if the debtor can prove by clear and convincing evidence that 
the claim was filed by a creditor who unreasonably refused to 
negotiate a reasonable alternative repayment schedule proposed 
by an approved credit counseling agency acting on behalf of the 
debtor, if--
            ``(A) such offer was made at least 60 days before 
        the filing of the petition;
            ``(B) such offer provided for payment of at least 
        60 percent of the amount of the debtor over a period 
        not to exceed the repayment period of the loan, or a 
        reasonable extension thereof; and
            ``(C) no part of the debt under the alternative 
        repayment schedule is nondischargeable.
    ``(2) The debtor shall have the burden of proving that the 
proposed alternative repayment schedule was made in the 60-day 
period specified in subparagraph (A) and that the creditor 
unreasonably refused to consider the debtor's proposal.''.
    (b) Limitation on Avoidability.--Section 547 of title 11, 
United States Code, is amended by adding at the end the 
following:
    ``(h) The trustee may not avoid a transfer if such transfer 
was made as a part of an alternative repayment plan between the 
debtor and any creditor of the debtor created by an approved 
credit counseling agency.''.

SEC. 112. ENHANCED DISCLOSURE FOR CREDIT EXTENSIONS SECURED BY A 
                    DWELLING.

    (a) Study Required.--During the period beginning 180 days 
after the date of enactment of this Act and ending 18 months 
after the date of the enactment, the Board of Governors of the 
Federal Reserve System (in this section referred to as the 
``Board'') shall conduct a study and submit to Congress a 
report (including recommendations for any appropriate 
legislation) regarding--
            (1) whether a consumer engaging in an open-end 
        credit transaction (as defined pursuant to section 103 
        of the Truth in Lending Act) secured by the consumer's 
        principal dwelling is provided adequate information 
        under Federal law, including under section 127A of the 
        Truth in Lending Act, regarding the tax deductibility 
        of interest paid on such transaction; and
            (2) whether a consumer engaging in a closed-end 
        credit transaction (as defined pursuant to section 103 
        of the Truth in Lending Act) secured by the consumer's 
        principal dwelling is provided adequate information 
        regarding the tax deductibility of interest paid on 
        such transaction.

In conducting such study, the Board shall specifically consider 
whether additional disclosures are necessary with respect to 
such open-end or closed-end credit transactions in which the 
amount of the credit extended exceeds the fair market value of 
the dwelling.
    (b) Regulations.--If the Board determines that additional 
disclosures are necessary in connection with transactions 
described in subsection (a), the Board, pursuant to its 
authority under the Truth in Lending Act, may promulgate 
regulations that would require such additional disclosures. Any 
such regulations promulgated by the Board under this section 
shall not take effect before the end of the 36-month period 
after the date of the enactment of this Act.

SEC. 113. DUAL USE DEBIT CARD.

    (a) Study Required.--The Board of Governors of the Federal 
Reserve System (in this section referred to as the ``Board'') 
shall conduct a study of existing protections provided to 
consumers to limit their liability for unauthorized use or a 
debit card or similar access device.
    (b) Specific Considerations.--In conducting the study 
required by subsection (a), the Board shall specifically 
consider the following--
            (1) the extent to which existing provisions of 
        section 909 of the Electronic Fund Transfer Act and the 
        Board's implementing regulations provide adequate 
        unauthorized use liability protection for consumers;
            (2) the extent to which any voluntary industry 
        rules have enhanced the level of protection afforded 
        consumers in connection with such unauthorized use 
        liability; and
            (3) whether amendments to the Electronic Funds 
        Transfer Act or the Board's implementing regulations 
        thereto are necessary to provide adequate protection 
        for consumers in this area.
    (c) Report and Regulations.--Not later than 2 years after 
the date of the enactment of this Act, the Board shall make 
public a report on its findings with respect to the adequacy of 
existing protections afforded consumers with respect to 
unauthorized-use liability for debit cards and similar access 
devices. If the Board determines that such protections are 
inadequate, the Board, pursuant to its authority under the 
Electronic Funds Transfer Act, may issue regulations to address 
such inadequacy. Any regulations issued by the Board shall not 
be effective before 36 months after the date of the enactment 
of this Act.

SEC. 114. ENHANCED DISCLOSURES UNDER AN OPEN-END CREDIT PLAN.

    (a) Initial and Annual Minimum Payment Disclosure.--Section 
127(a) of the Truth in Lending Act (15 U.S.C. 1637(a)) is 
amended by adding at the end the following:
            ``(9) In the case of any credit or charge card 
        account under an open-end consumer credit plan on which 
        a minimum monthly or periodic payment will be required, 
        other than an account described in paragraph (8)--
                    ``(A) the following statement: `The minimum 
                payment amount shown on your billing statement 
                is the smallest payment which you can make in 
                order to keep the account in good standing. 
                This payment option is offered as a convenience 
                and you may make larger payments at any time. 
                Making only the minimum payment each month will 
                increase the amount of interest you pay and the 
                length of time it takes to repay your 
                outstanding balance.';
                    ``(B) if the plan provides that the 
                consumer will be permitted to forgo making a 
                minimum payment during a specified billing 
                cycle, a statement, if applicable, that if the 
                consumer chooses to forgo making the minimum 
                payment, finance charges will continue to 
                accrue; and
                    ``(C) an example, based on an annual 
                percentage rate and method for determining 
                minimum periodic payments recently in effect 
                for that creditor, and a $500 outstanding 
                balance, showing the estimated minimum periodic 
                payment, and the estimated period of time it 
                would take to repay the $500 outstanding 
                balance if the consumer paid only the minimum 
                periodic payment on each monthly or periodic 
                statement and obtained no additional extensions 
                of credit.
            ``(10) With respect to one billing cycle per 
        calendar year, the creditor shall transmit the 
        information required under paragraph (9) to each 
        consumer to whom the creditor is required to transit a 
        statement pursuant to subsection (b) for such billing 
        cycle. The creditor shall also transmit to such 
        consumer for such cycle a worksheet prescribed by the 
        Board to assist the consumer in determining the 
        consumer's household income and debt obligations.''.
    (b) Period Minimum Payment Disclosures.--Section 127(b) of 
the Truth in Lending Act (15 U.S.C. 1637(b)) is amended by 
adding at the end the following:
            ``(11) The following statement: `The minimum 
        payment amount shown on your billing statement is the 
        smallest payment which you can make in order to keep 
        the account in good standing. This payment option is 
        offered as a convenience and you maymake larger 
payments at any time. Making only the minimum payment each month will 
increase the amount of interest you pay and the length of time it takes 
to repay your outstanding balance.' ''.
    (c) Enforcement.--Section 127 of the Truth in Lending Act 
(15 U.S.C. 1637) is amended by adding at the end the following:
    ``(h) In promulgating regulations to implement the 
disclosure of an example required under subsection (a)(9)(C) 
and (a)(10), the Board shall set forth a model disclosure to 
accompany the example stating that the credit features shown 
are only an example which does not obligate the creditor, but 
is intended to illustrate the approximate length of time it 
could take to repay using the assumptions set forth in 
subsection (a)(9)(C) without regard to any other factors that 
could impact an approximate repayment period, including other 
credit features or the consumer's payment or other behavior 
with respect to the account. Compliance with the disclosures 
required under subsection (a)(9)(C) and (a)(10) shall be 
enforced exclusively by the Federal agencies set forth in 
section 108.''.
    (d) Regulatory Implementation.--The Board of Governors of 
the Federal Reserve System (in this section referred to as the 
``Board'') shall promulgate regulations implementing the 
amendments made by subsections (a) and (b). Such regulations 
shall take effect no earlier than the end of the 36-month 
period beginning on the date of the enactment of this Act.
    (e) Study Required.--The Board shall conduct a study to 
determine whether consumers have adequate information about 
borrowing activities which may result in financial problems. In 
studying this issue, the Board shall consider the extent to 
which--
            (1) consumers, in establishing new credit 
        arrangements, are aware of their existing payment 
        obligations, the need to consider those obligations in 
        deciding to take on new credit, and how taking on 
        excessive credit can result in financial difficulty;
            (2) minimum periodic payment features offered in 
        connection with open-end credit plans impact consumer 
        default rates;
            (3) consumers always make only the minimum payment 
        throughout the life of the plan;
            (4) consumers are aware that making only minimum 
        payments will increase the cost and repayment period of 
        an open-end loan; and
            (5) the availability of low minimum payment options 
        is a cause of consumers experiencing financial 
        difficulty.
    (f) Report to Congress.--Before the end of the 2-year 
period beginning on the date of the enactment of this Act, the 
Board shall submit to Congress a report containing the findings 
of the Board in connection with the study required under 
subsection (b).
    (g) Regulations.--The Board shall, by regulation 
promulgated pursuant to its authority under the Truth in 
Lending Act, require additional disclosures to consumers 
regarding minimum payment features, including periodic 
statement disclosures, if the Board determines that such 
disclosures are necessary based on its findings. Any such 
regulations promulgated by the Board shall not take effect 
earlier than January 1, 2001.

SEC. 115. PROTECTION OF SAVINGS EARMARKED FOR THE POSTSECONDARY 
                    EDUCATION OF CHILDREN.

    (a) In General.--Section 522(b) of title 11, United States 
Code, as amended by section 330, is amended--
            (1) in paragraph (2)--
                    (A) in subparagraph (B), by striking 
                ``and'' at the end;
                    (B) in subparagraph (C), by striking the 
                period at the end and inserting ``; and''; and
                    (C) by adding at the end the following:
            ``(D) postsecondary education accounts as described 
        as follows:
                    ``(i) except as provided under applicable 
                State law or except as provided in paragraph 
                (5), any funds placed in a qualified tuition 
                program (as described in section 529(b) of the 
                Internal Revenue Code of 1986) at least 365 
                days before the date of entry of the order for 
                relief and which has not been pledged or 
                promised to any person in connection with any 
                extension of credit; or
                    ``(ii) except as provided in paragraph (5), 
                any funds placed in an education individual 
                retirement account (as defined in section 
                530(b)(1) of the Internal Revenue Code of 1986) 
                at least 365 days before the date of entry of 
                the order for relief and which has not been 
                pledged or promised to any person in connection 
                with any extension of credit;''; and
            (4) by adding at the end the following:
    ``(5) For purposes of paragraph (3)(D), funds placed in a 
qualified tuition program or in an education individual 
retirement account shall not be exempt under this subsection--
            ``(A) unless the debtor has one or more dependent 
        children less than 22 years of age;
            ``(B) if the amounts in such postsecondary accounts 
        do not exceed the lesser of $50,000 (in the aggregate) 
        in accounts attributable to each such dependent child 
        or $100,000 (in the aggregate) attributable to all such 
        dependent children;
            ``(C) to the extent such funds contributed to such 
        account exceed $500 per year per child; and
            ``(D) any individual (other than the dependent 
        child of the debtor to whom such account is 
        attributable) has any ownership right to such funds, or 
        the right to obtain ownership in the future of any 
        amount of such funds (other than upon the death or 
        serious mental impairment of such child), or direct the 
        application of such funds for any purpose other than 
        the postsecondary education of such child.''.

SEC. 116. EFFECT OF DISCHARGE.

    Section 524 of title 11, United States Code, is amended by 
adding at the end the following:
    ``(i) The willful failure of a creditor to credit payments 
received under a plan confirmed under this title (including a 
plan of reorganization confirmed under chapter 11 of this 
title) in the manner required by the plan (including crediting 
the amounts required under the plan) shall constitute a 
violation of an injunction under subsection (a)(2).
    ``(j)(1) An individual who is injured by the failure of a 
creditor to comply with the requirements for a reaffirmation 
agreement under subsections (c) and (d), or by any willful 
violation of the injunction under subsection (a)(2), shall be 
entitled to recover--
            ``(A) the greater of--
                    ``(i) the amount of actual damages; or
                    ``(ii) $1,000; and
            ``(B) costs and attorneys' fees.
    ``(2) An action to recover for a violation specified in 
paragraph (1) may not be brought as a class action.''.

SEC. 117. AUTOMATIC STAY.

    Section 362(h) of title 11, United States Code, is amended 
to read as follows:
    ``(h)(1) An individual who is injured by any willful 
violation of a stay provided in this section shall be entitled 
to recover--
            ``(A) actual damages; and
            ``(B) reasonable costs, including attorneys' fees.
    ``(2) An action to recover for a violation specified in 
paragraph (1) may not be brought as a class action.''.

SEC. 118. REINFORCE THE FRESH START.

    (a) Restoration of an Effective Discharge.--Section 
523(a)(17) of title 11, United States Code, is amended--
            (1) by striking ``by a court'' and inserting ``on a 
        prisoner by any court'',
            (2) by striking ``section 1915(b) or (f)'' and 
        inserting ``subsection (b) or (f)(2) of section 1915'', 
        and
            (3) by inserting ``(or a similar non-Federal law)'' 
        after ``title 28'' each place it appears.

SEC. 119. DISCOURAGING BAD FAITH REPEAT FILINGS.

    Section 362(c) of title 11, United States Code, is 
amended--
            (1) in paragraph (1) by striking ``and'' at the 
        end;
            (2) in paragraph (2) by striking the period at the 
        end and inserting a semicolon; and
            (3) by adding at the end the following new 
        paragraphs:
            ``(3) If a single or joint case is filed by or 
        against an individual debtor under chapter 7, 11, or 
        13, and if a single or joint case of the debtor was 
        pending within the previous 1-year period but was 
        dismissed, other than a case refiled under a chapter 
        other than chapter 7 after dismissal under section 
        707(b) of this title, the stay under subsection (a) 
        with respect to any action taken with respect to a debt 
        or property securing such debt or with respect to any 
        lease will terminate with respect to the debtor on the 
        30th day after the filing of the later case. Upon 
        motion by a party in interest for continuation of the 
        automatic stay and upon notice and a hearing, the court 
        may extend the stay in particular cases as to any or 
        all creditors (subject to such conditions or 
        limitations as the court may then impose) after notice 
        and a hearing completed before the expiration of the 
        30-day period only if the party in interest 
        demonstrates that the filing of the later case is in 
        good faith as to the creditors to be stayed. A case is 
        presumptively filed not in good faith (but such 
        presumption may be rebutted by clear and convincing 
        evidence to the contrary)--
                    ``(A) as to all creditors if--
                            ``(i) more than 1 previous case 
                        under any of chapters 7, 11, or 13 in 
                        which the individual was a debtor was 
                        pending within such 1-year period;
                            ``(ii) a previous case under any of 
                        chapters 7, 11, or 13 in which the 
                        individual was a debtor was dismissed 
                        within such 1-year period, after the 
                        debtor failed to file or amend the 
                        petition or other documents as required 
                        by this title or the court without 
                        substantial excuse (but mere 
                        inadvertence or negligence shall not be 
                        substantial excuse unless the dismissal 
                        was caused by the negligence of the 
                        debtor's attorney), failed to provide 
                        adequate protection as ordered by the 
                        court, or failed to perform the terms 
                        of a plan confirmed by the court; or
                            ``(iii) there has not been a 
                        substantial change in the financial or 
                        personal affairs of the debtor since 
                        the dismissal of the next most previous 
                        case under any of chapters 7, 11, or 13 
                        of this title, or any other reason to 
                        conclude that the later case will be 
                        concluded, if a case under chapter 7 of 
                        this title, with a discharge, and if a 
                        chapter 11 or 13 case, a confirmed plan 
                        which will be fully performed;
                    ``(B) as to any creditor that commenced an 
                action under subsection (d) in a previous case 
                in which the individual was a debtor if, as of 
                the date of dismissal of such case, that action 
                was still pending or had been resolved by 
                terminating, conditioning, or limiting the stay 
                as to actions of such creditor.
            ``(4) If a single or joint case is filed by or 
        against an individual debtor under this title, and if 2 
        or more single or joint cases of the debtor were 
        pending within the previous year but were dismissed, 
        other than a case refiled under section 707(b) of this 
        title, the stay under subsection (a) will not go into 
        effect upon the filing of the later case. On request of 
        a party in interest, the court shall promptly enter an 
        order confirming that no stay is in effect. If a party 
        in interest requests within 30 days of the filing of 
        the later case, the court may order the stay to take 
        effect in the case as to any or all creditors (subject 
        to such conditions or limitations as the court may 
        impose), after notice and hearing, only if the party in 
        interest demonstrates that the filing of the later case 
        is in good faith as to the creditors to be stayed. A 
        stay imposed pursuant to the preceding sentence will be 
        effective on the date of entry of the order allowing 
        the stay to go into effect. A case is presumptively not 
        filed in good faith (but such presumption may be 
        rebutted by clear and convincing evidence to the 
        contrary)--
                    ``(A) as to all creditors if--
                            ``(i) 2 or more previous cases 
                        under this title in which the 
                        individual was a debtor were pending 
                        within the 1-year period;
                            ``(ii) a previous case under this 
                        title in which the individual was a 
                        debtor was dismissed within the time 
                        period stated in this paragraph after 
                        the debtor failed to file or amend the 
                        petition or other documents as required 
                        by this title or the court without 
                        substantial excuse (but mere 
                        inadvertence or negligence shall not be 
                        substantial excuse unless the dismissal 
                        was caused by the negligence of the 
                        debtor's attorney), failed to pay 
                        adequate protection as ordered by the 
                        court, or failed to perform the terms 
                        of a plan confirmed by the court; or
                            ``(iii) there has not been a 
                        substantial change in the financial or 
                        personal affairs of the debtor since 
                        the dismissal of the next most previous 
                        case under this title, or any other 
                        reason to conclude that the later case 
                        will not be concluded, if a case under 
                        chapter 7, with a discharge, and if a 
                        case under chapter 11 or 13, with a 
                        confirmed plan that will be fully 
                        performed; or
                    ``(B) as to any creditor that commenced an 
                action under subsection (d) in a previous case 
                in which the individual was a debtor if, as of 
                the date of dismissal of such case, such action 
                was still pending or had been resolved by 
                terminating, conditioning, or limiting the stay 
                as to action of such creditor.''.

SEC. 120. CURBING ABUSIVE FILINGS.

    (a) In General.--Section 362(d) of title 11, United States 
Code, is amended--
            (1) in paragraph (2), by striking ``or'' at the 
        end;
            (2) in paragraph (3), by striking the period at the 
        end and inserting ``; or''; and
            (3) by adding at the end the following:
            ``(4) with respect to a stay of an act against real 
        property under subsection (a), by a creditor whose 
        claim is secured by an interest in such real estate, if 
        the court finds that the filing of the bankruptcy 
        petition was part of a scheme to delay, hinder, and 
        defraud creditors that involved either--
                    ``(A) transfer of all or part ownership of, 
                or other interest in, the real property without 
                the consent of the secured creditor or court 
                approval; or
                    ``(B) multiple bankruptcy filings affecting 
                the real property.

If recorded in compliance with applicable State laws governing 
notices of interests or liens in real property, an order 
entered pursuant to this subsection shall be binding in any 
other case under this title purporting to affect the real 
property filed not later than 2 years after that recording, 
except that a debtor in a subsequent case may move for relief 
from such order based upon changed circumstances or for good 
cause shown, after notice and a hearing.''.
    (b) Automatic Stay.--Section 362(b) of title 11, United 
States Code, is amended--
            (1) in paragraph (17), by striking ``or'' at the 
        end;
            (2) in paragraph (18) by striking the period at the 
        end; and
            (3) by inserting after paragraph (18) the 
        following:
            ``(19) under subsection (a), of any act to enforce 
        any lien against or security interest in real property 
        following the entry of an order under section 362(d)(4) 
        of this title as to that property in any prior 
        bankruptcy case for a period of 2 years after entry of 
        such an order. The debtor in a subsequent case, 
        however, may move the court for relief from such order 
        based upon changed circumstances or for other good 
        cause shown, after notice and a hearing; or
            ``(20) under subsection (a), of any act to enforce 
        any lien against or security interest in real 
        property--
                    ``(A) if the debtor is ineligible under 
                section 109(g) of this title to be a debtor in 
                a bankruptcy case; or
                    ``(B) if the bankruptcy case was filed in 
                violation of a bankruptcy court order in a 
                prior bankruptcy case prohibiting the debtor 
                from being a debtor in another bankruptcy 
                case.''.

SEC. 121. DEBTOR RETENTION OF PERSONAL PROPERTY SECURITY.

    Title 11, United States Code, is amended--
            (1) in section 521--
                    (A) in paragraph (4) by striking ``and'' at 
                the end;
                    (B) in paragraph (5) by striking the period 
                at the end and inserting ``; and''; and
                    (C) by adding at the end the following:
            ``(6) in an individual case under chapter 7 of this 
        title, not retain possession of personal property as to 
        which a creditor has an allowed claim for the purchase 
        price secured in whole or in part by an interest in 
        that personal property unless, in the case of an 
        individual debtor, the debtor takes 1 of the following 
        actions within 45 days after the first meeting of 
        creditors under section 341(a)--
                    ``(A) enters into an agreement with the 
                creditor pursuant to section 524(c) of this 
                title with respect to the claim secured by such 
                property; or
                    ``(B) redeems such property from the 
                security interest pursuant to section 722 of 
                this title.

        ``If the debtor fails to so act within the 45-day 
        period, the personal property affected shall no longer 
        be property of the estate, and the creditor may take 
        whatever action as to such property as is permitted by 
        applicable nonbankruptcy law, unless the court 
        determines on the motion of the trustee, and after 
        notice and a hearing, that such property is of 
        consequential value or benefit to the estate.''; and
            (2) in section 722 by inserting ``in full at the 
        time of redemption'' before the period at the end.

SEC. 122. RELIEF FROM THE AUTOMATIC STAY WHEN THE DEBTOR DOES NOT 
                    COMPLETE INTENDED SURRENDER OF CONSUMER DEBT 
                    COLLATERAL.

    Title 11, United States Code, is amended as follows--
            (1) in section 362--
                    (A) by striking ``(e), and (f)'' in 
                subsection (c) and inserting in lieu thereof 
                ``(e), (f), and (h)''; and
                    (B) by redesignating subsection (h), as 
                amended by section 117, as subsection (i) and 
                by inserting after subsection (g) the 
                following:
    ``(h) In an individual case pursuant to chapter 7, 11, or 
13 the stay provided by subsection (a) is terminated with 
respect to property of the estate securing in whole or in part 
a claim, or subject to an unexpired lease, if the debtor fails 
within the applicable time set by section 521(a)(2) of this 
title--
            ``(1) to file timely any statement of intention 
        required under section 521(a)(2) of this title with 
        respect to that property or to indicate therein that 
        the debtor will either surrender the property or retain 
        it and, if retaining it, either redeem the property 
        pursuant to section 722 of this title, reaffirm the 
        debt it secures pursuant to section 524(c) of this 
        title, or assume the unexpired lease pursuant to 
        section 365(p) of this title if the trustee does not do 
        so, as applicable; or
            ``(2) to take timely the action specified in that 
        statement of intention, as it may be amended before 
        expiration of the period for taking action, unless the 
        statement of intention specifies reaffirmation and the 
        creditor refuses to reaffirm on the original contract 
        terms;

unless the court determines on the motion of the trustee, and 
after notice and a hearing, that such property is of 
consequential value or benefit to the estate.''; and
            (2) in section 521, as amended by sections 121 and 
        604--
                    (A) in paragraph (2) by striking 
                ``consumer'';
                    (B) in paragraph (2)(B)--
                            (i) by striking ``forty-five days 
                        after the filing of a notice of intent 
                        under this section'' and inserting ``30 
                        days after the first date set for the 
                        meeting of creditors under section 
                        341(a) of this title''; and
                            (ii) by striking ``forty-five day'' 
                        the second place it appears and 
                        inserting ``30-day'';
                    (C) in paragraph (2)(C) by inserting 
                ``except as provided in section 362(h) of this 
                title'' before the semicolon; and
                    (D) by adding at the end the following:
    ``(c) If the debtor fails timely to take the action 
specified in subsection (a)(6) of this section, or in 
paragraphs (1) and (2) of section 362(h) of this title, with 
respect to property which a lessor or bailor owns and has 
leased, rented, or bailed to the debtor or as to which a 
creditor holds a security interest not otherwise voidable under 
section 522(f), 544, 545, 547, 548, or 549 of this title, 
nothing in this title shall prevent or limit the operation of a 
provision in the underlying lease or agreement which has the 
effect of placing the debtor in default under such lease or 
agreement by reason of the occurrence, pendency, or existence 
of a proceeding under this title or the insolvency of the 
debtor. Nothing in this subsection shall be deemed to justify 
limiting such a provision in any other circumstance.''.

SEC. 123. GIVING SECURED CREDITORS FAIR TREATMENT IN CHAPTER 13.

    Section 1325(a)(5)(B)(i) of title 11, United States Code, 
is amended to read as follows:
                    ``(i) the plan provides that the holder of 
                such claim retain the lien securing such claim 
                until the earlier of payment of the underlying 
                debt determined under nonbankruptcy law or 
                discharge under section 1328 of this title, and 
                that if the case under this chapter is 
                dismissed or converted without completion of 
                the plan, such lien shall also be retained by 
                such holder to the extent recognized by 
                applicable nonbankruptcy law; and''.

SEC. 124. RESTRAINING ABUSIVE PURCHASES ON SECURED CREDIT.

    Section 506 of title 11, United States Code, is amended by 
adding at the end the following:
    ``(e) In an individual case under chapter 7, 11, 12, or 
13--
            ``(1) subsection (a) shall not apply to an allowed 
        claim to the extent attributable in whole or in part to 
        the purchase price of personal property acquired by the 
        debtor within 5 years of the filing of the petition, 
        except for the purpose of applying paragraph (3) of 
        this subsection;
            ``(2) if such allowed claim attributable to the 
        purchase price is secured only by the personal property 
        so acquired, the value of the personal property and the 
        amount of the allowed secured claim shall be the sum of 
        the unpaid principal balance of the purchase price and 
        accrued and unpaid interest and charges at the contract 
        rate;
            ``(3) if such allowed claim attributable to the 
        purchase price is secured by the personal property so 
        acquired and other property, the value of the security 
        may be determined under subsection (a), but the value 
        of the security and the amount of the allowed secured 
        claim shall be not less than the unpaid principal 
        balance of the purchase price of the personal property 
        acquired and unpaid interest and charges at the 
        contract rate; and
            ``(4) in any subsequent case under this title that 
        is filed by or against the debtor in the 2-year period 
        beginning on the date the petition is filed in the 
        original case, the value of the personal property and 
        the amount of the allowed secured claim shall be deemed 
        to be not less than the amount provided under 
        paragraphs (2) and (3).''.

SEC. 125. FAIR VALUATION OF COLLATERAL.

    Section 506(a) of title 11, United States Code, is amended 
by adding at the end the following:

``In the case of an individual debtor under chapters 7 and 13, 
such value with respect to personal property securing an 
allowed claim shall be determined based on the replacement 
value of such property as of the date of filing thepetition 
without deduction for costs of sale or marketing. With respect to 
property acquired for personal, family, or household purpose, 
replacement value shall mean the price a retail merchant would charge 
for property of that kind considering the age and condition of the 
property at the time value is determined.''.

SEC. 126. EXEMPTIONS.

    Section 522(b)(2)(A) of title 11, United States Code, is 
amended--
            (1) by striking ``180'' and inserting ``730''; and
            (2) by striking ``, or for a longer portion of such 
        180-day period than in any other place''.

SEC. 127. LIMITATION.

    Section 522 of title 11, United States Code, is amended--
            (1) in subsection (b)(2)(A) by inserting ``subject 
        to subsection (n),'' before ``any property''; and
            (2) by adding at the end the following:
    ``(n) For purposes of subsection (b)(2)(A) and 
notwithstanding subsection (a), the value of an interest in--
            ``(1) real or personal property that the debtor or 
        a dependent of the debtor uses as a residence;
            ``(2) a cooperative that owns property that the 
        debtor or a dependent of the debtor uses as a 
        residence; or
            ``(3) a burial plot for the debtor or a dependent 
        of the debtor;

shall be reduced to the extent such value is attributable to 
any portion of any property that the debtor disposed of in the 
730-day period ending of the date of the filing of the 
petition, with the intent to hinder, delay, or defraud a 
creditor and that the debtor could not exempt, or that portion 
that the debtor could not exempt, under subsection (b) if on 
such date the debtor had held the property so disposed of.''.

SEC. 128. ROLLING STOCK EQUIPMENT.

    (a) In General.--Section 1168 of title 11, United States 
Code, is amended to read as follows:

``Sec. 1168. Rolling stock equipment.

    ``(a)(1) The right of a secured party with a security 
interest in or of a lessor or conditional vendor of equipment 
described in paragraph (2) to take possession of such equipment 
in compliance with an equipment security agreement, lease, or 
conditional sale contract, and to enforce any of its other 
rights or remedies under such security agreement, lease, or 
conditional sale contract, to sell, lease, or otherwise retain 
or dispose of such equipment, is not limited or otherwise 
affected by any other provision of this title or by any power 
of the court, except that the right to take possession and 
enforce those other rights and remedies shall be subject to 
section 362 of this title, if--
            ``(A) before the date that is 60 days after the 
        date of commencement of a case under this chapter, the 
        trustee, subject to the court's approval, agrees to 
        perform all obligations of the debtor under such 
        security agreement, lease, or conditional sale 
        contract; and
            ``(B) any default, other than a default of a kind 
        described in section 365(b)(2) of this title, under 
        such security agreement, lease, or conditional sale 
        contract--
                    ``(i) that occurs before the date of 
                commencement of the case and is an event of 
                default therewith is cured before the 
                expiration of such 60-day period;
                    ``(ii) that occurs or becomes an event of 
                default after the date of commencement of the 
                case and before the expiration of such 60-day 
                period is cured before the later of--
                            ``(I) the date that is 30 days 
                        after the date of the default or event 
                        of the default; or
                            ``(II) the expiration of such 60-
                        day period; and
                    ``(iii) that occurs on or after the 
                expiration of such 60-day period is cured in 
                accordance with the terms of such security 
                agreement, lease, or conditional sale contract, 
                if cure is permitted under that agreement, 
                lease, or conditional sale contract.
    ``(2) The equipment described in this paragraph--
            ``(A) is rolling stock equipment or accessories 
        used on rolling stock equipment, including 
        superstructures or racks, that is subject to a security 
        interest granted by, leased to, or conditionally sold 
        to a debtor; and
            ``(B) includes all records and documents relating 
        to such equipment that are required, under the terms of 
        the security agreement, lease, or conditional sale 
        contract, that is to be surrendered or returned by the 
        debtor in connection with the surrender or return of 
        such equipment.
    ``(3) Paragraph (1) applies to a secured party, lessor, or 
conditional vendor acting in its own behalf or acting as 
trustee or otherwise in behalf of another party.
    ``(b) The trustee and the secured party, lessor, or 
conditional vendor whose right to take possession is protected 
under subsection (a) may agree, subject to the court's 
approval, to extend the 60-day period specified in subsection 
(a)(1).
    ``(c)(1) In any case under this chapter, the trustee shall 
immediately surrender and return to a secured party, lessor, or 
conditional vendor, described in subsection (a)(1), equipment 
described in subsection (a)(2), if at any time after the date 
of commencement of the case under this chapter such secured 
party, lessor, or conditional vendor is entitled pursuant to 
subsection (a)(1) to take possession of such equipment and 
makes a written demand for such possession of the trustee.
    ``(2) At such time as the trustee is required under 
paragraph (1) to surrender and return equipment described in 
subsection (a)(2), any lease of such equipment, and any 
security agreement or conditional sale contract relating to 
such equipment, if such security agreement or conditional sale 
contract is an executory contract, shall be deemed rejected.
    ``(d) With respect to equipment first placed in service on 
or prior to October 22, 1994, for purposes of this section--
            ``(1) the term `lease' includes any written 
        agreement with respect to which the lessor and the 
        debtor, as lessee, have expressed in the agreement or 
        in a substantially contemporaneous writing that the 
        agreement is to be treated as a lease for Federal 
        income tax purposes; and
            ``(2) the term `security interest' means a 
        purchase-money equipment security interest.
    ``(e) With respect to equipment first placed in service 
after October 22, 1994, for purposes of this section, the term 
`rolling stock equipment' includes rolling stock equipment that 
is substantially rebuilt and accessories used on such 
equipment.''.
    (b) Aircraft Equipment and Vessels.--Section 1110 of title 
11, United States Code, is amended to read as follows:

``Sec. 1110. Aircraft equipment and vessels

    ``(a)(1) Except as provided in paragraph (2) and subject to 
subsection (b), the right of a secured party with a security 
interest in equipment described in paragraph (3), or of a 
lessor or conditional vendor of such equipment, to take 
possession of such equipment in compliance with a security 
agreement, lease, or conditional sale contract, and to enforce 
any of its other rights or remedies, under such security 
agreement, lease, or conditional sale contract, to sell, lease, 
or otherwise retain or dispose of such equipment, is not 
limited or otherwise affected by any other provision of this 
title or by any power of the court.
    ``(2) The right to take possession and to enforce the other 
rights and remedies described in paragraph (1) shall be subject 
to section 362 of this title if--
            ``(A) before the date that is 60 days after the 
        date of the order for relief under this chapter, the 
        trustee, subject to the approval of the court, agrees 
        to perform all obligations of the debtor under such 
        security agreement, lease, or conditional sale 
        contract; and
            ``(B) any default, other than a default of a kind 
        specified in section 365(b)(2) of this title, under 
        such security agreement, lease, or conditional sale 
        contract--
                    ``(i) that occurs before the date of the 
                order is cured before the expiration of such 
                60-day period;
                    ``(ii) that occurs after the date of the 
                order and before the expiration of such 60-day 
                period is cured before the later of--
                            ``(I) the date that is 30 days 
                        after the date of the default; or
                            ``(II) the expiration of such 60-
                        day period; and
                    ``(iii) that occurs on or after the 
                expiration of such 60-day period is cured in 
                compliance with the terms of such security 
                agreement, lease, or conditional sale contract, 
                if a cure is permitted under that agreement, 
                lease, or contract.
    ``(3) The equipment described in this paragraph--
            ``(A) is--
                    ``(i) an aircraft, aircraft engine, 
                propeller, appliance, or spare part (as defined 
                in section 40102 of title 49) that is subject 
                to a security interest granted by, leased to, 
                or conditionally sold to a debtor that, at the 
                time such transaction is entered into, holds an 
                air carrier operating certificate issued 
                pursuant to chapter 447 of title 49 for 
                aircraft capable of carrying 10 or more 
                individuals or 6,000 pounds or more of cargo; 
                or
                    ``(ii) a documented vessel (as defined in 
                section 30101(1) of title 46) that is subject 
                to a security interest granted by, leased to, 
                or conditionally sold to a debtor that is a 
                water carrier that, at the time such 
                transaction is entered into, holds a 
                certificate of public convenience and necessity 
                or permit issued by the Department of 
                Transportation; and
            ``(B) includes all records and documents relating 
        to such equipment that are required, under the terms of 
        the security agreement, lease, or conditional sale 
        contract, to be surrendered or returned by the debtor 
        in connection with the surrender or return of such 
        equipment.
    ``(4) Paragraph (1) applies to a secured party, lessor, or 
conditional vendor acting in its own behalf or acting as 
trustee or otherwise in behalf of another party.
    ``(b) The trustee and the secured party, lessor, or 
conditional vendor whose right to take possession is protected 
under subsection (a) may agree, subject to the approval of the 
court, to extend the 60-day period specified in subsection 
(a)(1).
    ``(c)(1) In any case under this chapter, the trustee shall 
immediately surrender and return to a secured party, lessor, or 
conditional vendor, described in subsection (a)(1), equipment 
described in subsection (a)(3), if at any time after the date 
of the order for relief under this chapter such secured party, 
lessor, or conditional vendor is entitled pursuant to 
subsection (a)(1) to take possession of such equipment and 
makes a written demand for such possession to the trustee.
    ``(2) At such time as the trustee is required under 
paragraph (1) to surrender and return equipment described in 
subsection (a)(3), any lease of such equipment, and any 
security agreement or conditional sale contract relating to 
such equipment, if such security agreement or conditional sale 
contract is an executory contract, shall be deemed rejected.
    ``(d) With respect to equipment first placed in service on 
or before October 22, 1994, for purposes of this section--
            ``(1) the term `lease' includes any written 
        agreement with respect to which the lessor and the 
        debtor, as lessee, have expressed in the agreement or 
        in a substantially contemporaneous writing that the 
        agreement is to be treated as a lease for Federal 
        income tax purposes; and
            ``(2) the term `security interest' means a 
        purchase-money equipment security interest.''.

SEC. 129. DISCHARGE UNDER CHAPTER 13.

    Section 1328(a) of title 11, United States Code, is amended 
by striking paragraphs (1) through (3) and inserting the 
following:
            ``(1) provided for under section 1322(b)(5) of this 
        title;
            ``(2) of the kind specified in paragraph (2), (4), 
        (3)(B), (5), (8), or (9) of section 523(a) of this 
        title;
            ``(3) for restitution, or a criminal fine, included 
        in a sentence on the debtor's conviction of a crime; or
            ``(4) for restitution, or damages, awarded in a 
        civil action against the debtor as a result of willful 
        or malicious injury by the debtor that caused personal 
        injury to an individual or the death of an 
        individual.''.

SEC. 130. BANKRUPTCY JUDGESHIPS.

    (a) Short Title.--This section may be cited as the 
``Bankruptcy Judgeship Act of 1998''.
    (b) Temporary Judgeships.--
            (1) Appointments.--The following judgeship 
        positions shall be filled in the manner prescribed in 
        section 152(a)(1) of title 28, United States Code, for 
        the appointment of bankruptcy judges provided for in 
        section 152(a)(2) of such title:
                    (A) One additional bankruptcy judgeship for 
                the eastern district of California.
                    (B) Four additional bankruptcy judgeships 
                for the central district of California.
                    (C) One additional bankruptcy judgeship for 
                the southern district of Florida.
                    (D) Two additional bankruptcy judgeships 
                for the district of Maryland.
                    (E) One additional bankruptcy judgeship for 
                the eastern district of Michigan.
                    (F) One additional bankruptcy judgeship for 
                the southern district of Mississippi.
                    (G) One additional bankruptcy judgeship for 
                the district of New Jersey.
                    (H) One additional bankruptcy judgeship for 
                the eastern district of New York.
                    (I) One additional bankruptcy judgeship for 
                the northern district of New York.
                    (J) One additional bankruptcy judgeship for 
                the southern district of New York.
                    (K) One additional bankruptcy judgeship for 
                the eastern district of Pennsylvania.
                    (L) One additional bankruptcy judgeship for 
                the middle district of Pennsylvania.
                    (M) One additional bankruptcy judgeship for 
                the western district of Tennessee.
                    (N) One additional bankruptcy judgeship for 
                the eastern district of Virginia.
            (2) Vacancies.--The first vacancy occurring in the 
        office of a bankruptcy judge in each of the judicial 
        districts set forth in paragraph (1) that--
                    (A) results from the death, retirement, 
                resignation, or removal of a bankruptcy judge; 
                and
                    (B) occurs 5 years or more after the 
                appointment date of a bankruptcy judge 
                appointed under paragraph (1);

        shall not be filled.
    (c) Extensions.--
            (1) In general.--The temporary bankruptcy judgeship 
        positions authorized for the northern district of 
        Alabama, the district of Delaware, the district of 
        Puerto Rico, the district of South Carolina, and the 
        eastern district of Tennessee under section 3(a) (1), 
        (3), (7), (8), and (9) of the Bankruptcy Judgeship Act 
        of 1992 (28 U.S.C. 152 note) are extended until the 
        first vacancy occurring in the office of a bankruptcy 
        judge in the applicable district resulting from the 
        death, retirement, resignation, or removal of a 
        bankruptcy judge and occurring--
                    (A) 8 years or more after November 8, 1993, 
                with respect to the northern district of 
                Alabama;
                    (B) 10 years or more after October 28, 
                1993, with respect to the district of Delaware;
                    (C) 8 years or more after August 29, 1994, 
                with respect to the district of Puerto Rico;
                    (D) 8 years or more after June 27, 1994, 
                with respect to the district of South Carolina; 
                and
                    (E) 8 years or more after November 23, 
                1993, with respect to the eastern district of 
                Tennessee.
            (2) Applicability of other provisions.--All other 
        provisions of section 3 of the Bankruptcy Judgeship Act 
        of 1992 remain applicable to such temporary judgeship 
        position.
    (d) Technical Amendment.--The first sentence of section 
152(a)(1) of title 28, United States Code, is amended to read 
as follows: ``Each bankruptcy judge to be appointed for a 
judicial district as provided in paragraph (2) shall be 
appointed by the United States court of appeals for the circuit 
in which such district is located.''.
    (e) Travel Expenses of Bankruptcy Judges.--Section 156 of 
title 28, United States Code, is amended by adding at the end 
the following new subsection:
    ``(g)(1) In this subsection, the term `travel expenses'--
            ``(A) means the expenses incurred by a bankruptcy 
        judge for travel that is not directly related to any 
        case assigned to such bankruptcy judge; and
            ``(B) shall not include the travel expenses of a 
        bankruptcy judge if--
                    ``(i) the payment for the travel expenses 
                is paid by such bankruptcy judge from the 
                personal funds of such bankruptcy judge; and
                    ``(ii) such bankruptcy judge does not 
                receive funds (including reimbursement) from 
                the United States or any other person or entity 
                for the payment of such travel expenses.
    ``(2) Each bankruptcy judge shall annually submit the 
information required under paragraph (3) to the chief 
bankruptcy judge for the district in which the bankruptcy judge 
is assigned.
    ``(3)(A) Each chief bankruptcy judge shall submit an annual 
report to the Director of the Administrative Office of the 
United States Courts on the travel expenses of each bankruptcy 
judge assigned to the applicable district (including the travel 
expenses of the chief bankruptcy judge of such district).
    ``(B) The annual report under this paragraph shall 
include--
            ``(i) the travel expenses of each bankruptcy judge, 
        with the name of the bankruptcy judge to whom the 
        travel expenses apply;
            ``(ii) a description of the subject matter and 
        purpose of the travel relating to each travel expense 
        identified under clause (i), with the name of the 
        bankruptcy judge to whom the travel applies; and
            ``(iii) the number of days of each travel described 
        under clause (ii), with the name of the bankruptcy 
        judge to whom the travel applies.
    ``(4)(A) The Director of the Administrative Office of the 
United States Courts shall--
            ``(i) consolidate the reports submitted under 
        paragraph (3) into a single report; and
            ``(ii) annually submit such consolidated report to 
        Congress.
    ``(B) The consolidated report submitted under this 
paragraph shall include the specific information required under 
paragraph (3)(B), including the name of each bankruptcy judge 
with respect to clauses (i), (ii), and (iii) of paragraph 
(3)(B).''.

SEC. 131. ADDITIONAL AMENDMENTS TO TITLE 11, UNITED STATES CODE.

    (a) Section 507(a) of title 11, United States Code, is 
amended by inserting after paragraph (9) the following:
            ``(10) Tenth, allowed claims for death or personal 
        injuries resulting from the operation of a motor 
        vehicle or vessel if such operation was unlawful 
        because the debtor was intoxicated from using alcohol, 
        a drug or another substance.''.
    (b) Section 523(a)(9) of title 11, United States Code, is 
amended by inserting ``or vessel'' after ``vehicle''.

SEC. 132. AMENDMENT TO SECTION 1325 OF TITLE 11, UNITED STATES CODE.

    Section 1325(b)(2) of title 11, United States Code, is 
amended by inserting after ``received by the debtor'', ``(other 
than child support payments, foster care payments, or 
disability payments for a dependent child made in accordance 
with applicable nonbankruptcy law and which is reasonably 
necessary to be expended)''.

SEC. 133. APPLICATION OF THE CODEBTOR STAY ONLY WHEN THE STAY PROTECTS 
                    THE DEBTOR.

    Section 1301(b) of title 11, United States Code, is 
amended--
            (1) by inserting ``(1)'' after ``(b)''; and
            (2) by adding at the end the following:
    ``(2)(A) Notwithstanding subsection (c) and except as 
provided in subparagraph (B), in any case in which the debtor 
did not receive the consideration for the claim held by a 
creditor, the stay provided by subsection (a) shall apply to 
that creditor for a period not to exceed 30 days beginning on 
the date of the order for relief, to the extent the creditor 
proceeds against--
            ``(i) the individual that received that 
        consideration; or
            ``(ii) property not in the possession of the debtor 
        that secures that claim.
    ``(B) Notwithstanding subparagraph (A), the stay provided 
by subsection (a) shall apply in any case in which the debtor 
is primarily obligated to pay the creditor in whole or in part 
with respect to a claim described in subparagraph (A) under a 
legally binding separation or property settlement agreement or 
divorce or dissolution decree with respect to--
            ``(i) an individual described in subparagraph 
        (A)(i); or
            ``(ii) property described in subparagraph (A)(ii).
    ``(3) Notwithstanding subsection (c), the stay provided by 
subsection (a) shall terminate as of the date of confirmation 
of the plan, in any case in which the plan of the debtor 
provides that the debtor's interest in personal property 
subject to a lease with respect to which the debtor is the 
lessee will be surrendered or abandoned or no payments will be 
made under the plan on account of the debtor's obligations 
under the lease.''.

SEC. 134. ADEQUATE PROTECTION FOR INVESTORS.

    (a) Definition.--Section 101 of title 11, United States 
Code, is amended by inserting after paragraph (48) the 
following:
            ``(48A) `securities self regulatory organization' 
        means either a securities association registered with 
        the Securities and Exchange Commission pursuant to 
        section 15A of the Securities Exchange Act of 1934 or a 
        national securities exchange registered with the 
        Securities and Exchange Commission pursuant to section 
        6 of the Securities Exchange Act of 1934;''.
    (b) Automatic Stay.--Section 362(b) of title 11, United 
States Code, as amended by section 120, is amended--
            (1) in paragraph (19) by striking ``or'' at the 
        end;
            (2) in paragraph (20) by striking the period at the 
        end and a inserting ``; or''; and
            (3) by inserting after paragraph (20) the 
        following:
            ``(21) under subsection (a), of the commencement or 
        continuation of an investigation or action by a 
        securities self regulatory organization to enforce such 
        organization's regulatory power; of the enforcement of 
        an order or decision, other than for monetary 
        sanctions, obtained in an action by the securities self 
        regulatory organization to enforce such organization's 
        regulatory power; or of any act taken by the securities 
        self regulatory organization to delist, delete, or 
        refuse to permit quotation of any stock that does not 
        meet applicable regulatory requirements.''.

SEC. 135. LIMITATION ON LUXURY GOODS.

    Section 523(a)(2)(C) of title 11, United States Code, is 
amended to read as follows:
            ``(C)(i) for purposes of subparagraph (A), consumer 
        debts owed to a single creditor and aggregating more 
        than $250 for `luxury goods or services' incurred by an 
        individual debtor on or within 90 days before the order 
        for relief under this title, or cash advances 
        aggregating more than $250 that are extensions of 
        consumer credit under an open end credit plan obtained 
        by an individual debtor on or within 90 days before the 
        order for relief under this title, are presumed to be 
        nondischargeable; and
            ``(ii) for purposes of this subparagraph--
                    ``(I) the term `luxury goods or services' 
                does not include goods or services reasonably 
                necessary for the support or maintenance of the 
                debtor or a dependent of the debtor; and
                    ``(II) the term `an extension of consumer 
                credit under an open end credit plan' has the 
                same meaning such term has for purposes of the 
                Consumer Credit Protection Act;''.

SEC. 136. GIVING DEBTORS THE ABILITY TO KEEP LEASED PERSONAL PROPERTY 
                    BY ASSUMPTION.

    Section 365 of title 11, United States Code, is amended by 
adding at the end the following:
    ``(p)(1) If a lease of personal property is rejected or not 
timely assumed by the trustee under subsection (d), the leased 
property is no longer property of the estate and the stay under 
section 362(a) of this title is automatically terminated.
    ``(2) In the case of an individual under chapter 7, the 
debtor may notify the creditor in writing that the debtor 
desires to assume the lease. Upon being so notified, the 
creditor may, at its option, notify the debtor that it is 
willing to have the lease assumed by the debtor and may 
condition such assumption on cure of any outstanding default on 
terms set by the contract. If within 30 days of such notice the 
debtor notifies the lessor in writing that the lease is 
assumed, the liability under the lease will be assumed by the 
debtor and not by the estate. The stay under section 362 of 
this title and the injunction under section 524(a)(2) of this 
title shall not be violated by notification of the debtor and 
negotiation of cure under this subsection.
    ``(3) In a case under chapter 11 of this title in which the 
debtor is an individual and in a case under chapter 13 of this 
title, if the debtor is the lessee with respect to personal 
property and the lease is not assumed in the plan confirmed by 
the court, the lease is deemed rejected as of the conclusion of 
the hearing on confirmation. If the lease is rejected, the stay 
under section 362 of this title and any stay under section 1301 
is automatically terminated with respect to the property 
subject to the lease.''.

SEC. 137. ADEQUATE PROTECTION OF LESSORS AND PURCHASE MONEY SECURED 
                    CREDITORS.

    (a) In General.--Chapter 13 of title 11, United States 
Code, is amended by adding after section 1307 the following:

``Sec. 1307A. Adequate protection in chapter 13 cases

    ``(a)(1)(A) On or before the date that is 30 days after the 
filing of a case under this chapter, the debtor shall make cash 
payments in an amount determined under paragraph (2)(A), to--
            ``(i) any lessor of personal property; and
            ``(ii) any creditor holding a claim secured by 
        personal property to the extent that the claim is 
        attributable to the purchase of that property by the 
        debtor.
    ``(B) The debtor or the plan shall continue making the 
adequate protection payments until the earlier of the date on 
which--
            ``(i) the creditor begins to receive actual 
        payments under the plan; or
            ``(ii) the debtor relinquishes possession of the 
        property referred to in subparagraph (A) to--
                    ``(I) the lessor or creditor; or
                    ``(II) any third party acting under claim 
                of right, as applicable.
    ``(2) The payments referred to in paragraph (1)(A) shall be 
the contract amount.
    ``(b)(1) Subject to the limitations under paragraph (2), 
the court may, after notice and hearing, change the amount and 
timing of the dates of payment of payments made under 
subsection (a).
    ``(2)(A) The payments referred to in paragraph (1) shall be 
payable not less frequently than monthly.
    ``(B) The amount of payments referred to in paragraph (1) 
shall not be less than the amount of any weekly, biweekly, 
monthly, or other periodic payment schedules as payable under 
the contract between the debtor and creditor.
    ``(c) Notwithstanding section 1326(b), the payments 
referred to in subsection (a)(1)(A) shall be continued in 
addition to plan payments under a confirmed plan until actual 
payments to the creditor begin under that plan, if the 
confirmed plan provides--
            ``(1) for payments to a creditor or lessor 
        described in subsection (a)(1); and
            ``(2) for the deferral of payments to such creditor 
        or lessor under the plan until the payment of amounts 
        described in section 1326(b).
    ``(d) Notwithstanding sections 362, 542, and 543, a lessor 
or creditor described in subsection (a) may retain possession 
of property described in that subsection that was obtained in 
accordance with applicable law before the date of filing of the 
petition until the first payment under subsection (a)(1)(A) is 
received by the lessor or creditor.
    ``(e) On or before 60 days after the filling of a case 
under this chapter, a debtor retaining possession of personal 
property subject to a lease or securing a claim attributable in 
whole or in part to the purchase price of such property shall 
provide each creditor or lessor reasonable evidence of the 
maintenance of any required insurance coverage with respect to 
the use or ownership of such property and continue to do so for 
so long as the debtor retains possession of such property.''.
    (b) Clerical Amendment.--The table of sections at the 
beginning of chapter 13 of title 11, United States Code, is 
amended by inserting after the item relating to section 1307 
the following:

``1307A. Adequate protection in chapter 13 cases.''.

SEC. 139. AUTOMATIC STAY.

    Section 362(b) of title 11, United States Code, as amended 
by sections 120 and 134, is amended--
            (1) in paragraph (20), by striking ``or'' at the 
        end;
            (2) in paragraph (21), by striking the period at 
        the end and inserting a semicolon; and
            (3) by inserting after paragraph (21) the 
        following:
            ``(22) under subsection (a) of any transfer that is 
        not avoidable under section 544 of this title and that 
        is not avoidable under section 549 of this title;
            ``(23) under subsection (a)(3), of the continuation 
        of any eviction, unlawful detainer action, or similar 
        proceeding by a lessor against a debtor involving 
        residential real property in which the debtor resides 
        as a tenant under a rental agreement and the debtor has 
        not paid rent to the lessor pursuant to the terms of 
        the lease agreement or applicable State law after the 
        commencement and during the course of the case;
            ``(24) under subsection (a)(3), of the commencement 
        or continuation of any eviction, unlawful detainer 
        action, or similar proceeding by a lessor against a 
        debtor involving residential real property in which the 
        debtor resides as a tenant under a rental agreement 
        that has terminated pursuant to the lease agreement or 
        applicable State law;
            ``(25) under subsection (a)(3), of any eviction, 
        unlawful detainer action, or similar proceeding, if the 
        debtor has previously filed within the last year and 
        failed to pay post-petition rent during the course of 
        that case; or
            ``(26) under subsection (a)(3), of eviction actions 
        based on endangerment to property or person or the use 
        of illegal drugs.''.

SEC. 140. EXTEND PERIOD BETWEEN BANKRUPTCY DISCHARGES.

    Title 11, United States Code, is amended--
            (1) in section 727(a)(8) by striking ``six'' and 
        inserting ``8''; and
            (2) in section 1328 by adding at the end the 
        following:
    ``(f) Notwithstanding subsections (a) and (b), the court 
shall not grant a discharge of all debts provided for by the 
plan or disallowed under section 502 of this title if the 
debtor has received a discharge in any case filed under this 
title within 5 years of the order for relief under this 
chapter.''.

SEC. 141. DEFINITION OF DOMESTIC SUPPORT OBLIGATION.

    Section 101 of title 11, United States Code, is amended--
            (1) by striking paragraph (12A); and
            (2) by inserting after paragraph (14) the 
        following:
            ``(14A) `domestic support obligation' means a debt 
        that accrues before or after the entry of an order for 
        relief under this title that is--
                    ``(A) owed to or recoverable by--
                            ``(i) a spouse, former spouse, or 
                        child of the debtor or that child's 
                        legal guardian; or
                            ``(ii) a governmental unit;
                    ``(B) in the nature of alimony, 
                maintenance, or support (including assistance 
                provided by a governmental unit) of such 
                spouse, former spouse, or child, without regard 
                to whether such debt is expressly so 
                designated;
                    ``(C) established or subject to 
                establishment before or after entry of an order 
                for relief under this title, by reason of 
                applicable provisions of--
                            ``(i) a separation agreement, 
                        divorce decree, or property settlement 
                        agreement;
                            ``(ii) an order of a court of 
                        record; or
                            ``(iii) a determination made in 
                        accordance with applicable 
                        nonbankruptcy law by a governmental 
                        unit; and
                    ``(D) not assigned to a nongovernmental 
                entity, unless that obligation is assigned 
                voluntarily by the spouse, former spouse, 
                child, or parent solely for the purpose of 
                collecting the debt.''.

SEC. 142. PRIORITIES FOR CLAIMS FOR DOMESTIC SUPPORT OBLIGATIONS.

    Section 507(a) of title 11, United States Code, is 
amended--
            (1) by striking paragraph (7);
            (2) by redesignating paragraphs (1) through (6) as 
        paragraphs (2) through (7), respectively;
            (3) in paragraph (2), as redesignated, by striking 
        ``First'' and inserting ``Second'';
            (4) in paragraph (3), as redesignated, by striking 
        ``Second'' and inserting ``Third'';
            (5) in paragraph (4), as redesignated, by striking 
        ``Third'' and inserting ``Fourth'';
            (6) in paragraph (5), as redesignated, by striking 
        ``Fourth'' and inserting ``Fifth'';
            (7) in paragraph (6), as redesignated, by striking 
        ``Fifth'' and inserting ``Sixth'';
            (8) in paragraph (7), as redesignated, by striking 
        ``Sixth'' and inserting ``Seventh''; and
            (9) by inserting before paragraph (2), as 
        redesignated, the following:
    ``(1) First, allowed claims for domestic support 
obligations to be paid in the following order on the condition 
that funds received under this paragraph by a governmental unit 
in a case under this title be applied:
            ``(A) Claims that, as of the date of entry of the 
        order for relief, are owed directly to a spouse, former 
        spouse, or child of the debtor, or the parent of such 
        child, without regard to whether the claim is filed by 
        the spouse, former spouse, child, or parent, or is 
        filed by a governmental unit on behalf of that person.
            ``(B) Claims that, as of the date of entry of the 
        order for relief, are assigned by a spouse, former 
        spouse, child of the debtor, or the parent of that 
        child to a governmental unit or are owed directly to a 
        governmental unit under applicable nonbankruptcy 
        law.''.

SEC. 143. REQUIREMENTS TO OBTAIN CONFIRMATION AND DISCHARGE IN CASES 
                    INVOLVING DOMESTIC SUPPORT OBLIGATIONS.

    Title 11, United States Code, is amended--
            (1) in section 1129(a), by adding at the end the 
        following:
            ``(14) If the debtor is required by a judicial or 
        administrative order or statute to pay a domestic 
        support obligation, the debtor has paid all amounts 
        payable under such order or statute for such obligation 
        that become payable after the date on which the 
        petition is filed.'';
            (2) in section 1325(a)--
                    (A) in paragraph (5), by striking ``and'' 
                at the end;
                    (B) in paragraph (6), by striking the 
                period at the end and inserting ``; and''; and
                    (C) by adding at the end the following:
            ``(7) if the debtor is required by a judicial or 
        administrative order or statute to pay a domestic 
        support obligation, the debtor has paid all amounts 
        payable under such order for such obligation that 
        become payable after the date on which the petition is 
        filed.''; and
            (3) in section 1328(a), as amended by section 129, 
        in the matter preceding paragraph (1), by inserting ``, 
        and with respect to a debtor who is required by a 
        judicial or administrative order to pay a domestic 
        support obligation, certifies that all amounts payable 
        under such order or statute that are due on or before 
        the date of the certification (including amounts due 
        before or after the petition was filed) have been 
        paid'' after ``completion by the debtor of all payments 
        under the plan''.

SEC. 144. EXCEPTIONS TO AUTOMATIC STAY IN DOMESTIC SUPPORT OBLIGATION 
                    PROCEEDINGS.

    Section 362(b) of title 11, United States Code, as amended 
by sections 120, 134, and 139, is amended--
            (1) by striking paragraph (2) and inserting the 
        following:
            ``(2) under subsection (a)--
                    ``(A) of the commencement or continuation 
                of an action or proceeding for--
                            ``(i) the establishment of 
                        paternity as a part of an effort to 
                        collect domestic support obligations; 
                        or
                            ``(ii) the establishment or 
                        modification of an order for domestic 
                        support obligations; or
                    ``(B) the collection of a domestic support 
                obligation from property that is not property 
                of the estate;'';
            (2) in paragraph (25), by striking ``or'' at the 
        end;
            (3) in paragraph (26), by striking the period at 
        the end and inserting a semicolon; and
            (4) by inserting after paragraph (26) the 
        following:
            ``(27) under subsection (a) with respect to the 
        withholding of income pursuant to an order as specified 
        in section 466(b) of the Social Security Act (42 U.S.C. 
        666(b)); or
            ``(28) under subsection (a) with respect to--
                    ``(A) the withholding, suspension, or 
                restriction of drivers' licenses, professional 
                and occupational licenses, and recreational 
                licenses pursuant to State law, asspecified in 
section 466(a)(16) of the Social Security Act (42 U.S.C. 666(a)(16)) or 
with respect to the reporting of overdue support owed by an absent 
parent to any consumer reporting agency as specified in section 
466(a)(7) of the Social Security Act (42 U.S.C. 666(a)(7));
                    ``(B) the interception of tax refunds, as 
                specified in sections 464 and 466(a)(3) of the 
                Social Security Act (42 U.S.C. 664 and 
                666(a)(3)); or
                    ``(C) the enforcement of medical 
                obligations as specified under title IV of the 
                Social Security Act (42 U.S.C. 601 et seq.).''.

SEC. 145. NONDISCHARGEABILITY OF CERTAIN DEBTS FOR ALIMONY, 
                    MAINTENANCE, AND SUPPORT.

    Section 523 of title 11, United States Code, is amended--
            (1) in subsection (a), by striking paragraph (5) 
        and inserting the following:
            ``(5) for a domestic support obligation;'';
            (2) in subsection (c), by striking ``(6), or (15)'' 
        and inserting ``or (6)''; and
            (3) in paragraph (15), by striking ``governmental 
        unit'' and all through the end of the paragraph and 
        inserting a semicolon.

SEC. 146. CONTINUED LIABILITY OF PROPERTY.

    Section 522 of title 11, United States Code, is amended--
            (1) in subsection (c), by striking paragraph (1) 
        and inserting the following:
            ``(1) a debt of a kind specified in paragraph (1) 
        or (5) of section 523(a) (in which case, 
        notwithstanding any provision of applicable 
        nonbankruptcy law to the contrary, such property shall 
        be liable for a debt of a kind specified in section 
        523(a)(5);''; and
            (2) in subsection (f)(1)(A), by striking the dash 
        and all that follows through the end of the 
        subparagraph and inserting ``of a kind that is 
        specified in section 523(a)(5); or''.

SEC. 147. PROTECTION OF DOMESTIC SUPPORT CLAIMS AGAINST PREFERENTIAL 
                    TRANSFER MOTIONS.

    Section 547(c)(7) of title 11, United States Code, is 
amended to read as follows:
            ``(7) to the extent such transfer was a bona fide 
        payment of a debt for a domestic support obligation; 
        or''.

SEC. 148. DEFINITION OF HOUSEHOLD GOODS AND ANTIQUES.

    Section 522(f)(1)(B) of title 11, United States Code, is 
amended as follows:
            (1) by inserting ``(i)'' after ``(B)''; and
            (2) by striking ``(i)'' and inserting ``(aa)''; and
            (3) by striking ``(ii)'' and inserting ``(bb)'';
            (4) by striking ``(iii)'' and inserting ``(cc)'';
            (5) by adding at the end thereof the following:
                    ``(ii) `household goods' shall mean for the 
                purposes of this subparagraph (B) clothing; 
                furniture; appliances; one radio; one 
                television; one VCR; linens; china; crockery; 
                kitchenware; educational materials and 
                educational equipment primarily for the use of 
                minor dependent children of the debtor, but 
                only one personal computer only if used 
                primarily for the education or entertainment of 
                such minor children; medical equipment and 
                supplies; furniture exclusively for the use of 
                minor children, elderly or disabled dependents 
                of the debtor; and personal effects (including 
                wedding rings and the toys and hobby equipment 
                of minor dependent children) of the debtor and 
                his or her dependents: Provided, That the 
                following are not included within the scope of 
                the term `household goods':
                            ``(aa) works of art (unless by or 
                        of the debtor or his or her 
                        dependents);
                            ``(bb) electronic entertainment 
                        equipment (except one television, one 
                        radio, and one VCR);
                            ``(cc) items acquired as antiques;
                            ``(dd) jewelry (except wedding 
                        rings);
                            ``(ee) a computer (except as 
                        otherwise provided for in this 
                        section), motor vehicle (including a 
                        tractor or lawn tractor), boat, or a 
                        motorized recreational device, 
                        conveyance, vehicle, watercraft, or 
                        aircraft.''.

SEC. 149. NONDISCHARGEABLE DEBTS.

    Section 523(a) of title 11, United States Code, is amended 
by inserting after paragraph (14) the following:
            ``(14A) incurred to pay a debt that is 
        nondischargeable by reason of section 727, 1141, 
        1228(a), 1228(b), or 1328(b), or any other provision of 
        this subsection, if the debtor incurred the debt to pay 
        such a nondischargeable debt with the intent to 
        discharge in bankruptcy the newly-created debt, except 
        that all debts incurred to pay nondischargeable debts, 
        without regard to intent, are nondischargeable if 
        incurred within 90 days of the filing of the 
        petition;''.

                TITLE II--DISCOURAGING BANKRUPTCY ABUSE

SEC. 201. REENACTMENT OF CHAPTER 12.

    (a) Reenactment.--Chapter 12 of title 11 of the United 
States Code, as in effect on September 30, 1998, is hereby 
reenacted.
    (b) Effective Date.--The amendment made by subsection (a) 
shall take effect on October 1, 1998.

SEC. 202. MEETINGS OF CREDITORS AND EQUITY SECURITY HOLDERS.

    Section 341 of title 11, United States Code, is amended by 
adding at the end the following:
    ``(e) Notwithstanding subsections (a) and (b), the court, 
on the request of a party in interest and after notice and a 
hearing, for cause may order that the United States trustee not 
convene a meeting of creditors or equity security holders if 
the debtor has filed a plan as to which the debtor solicited 
acceptances prior to the commencement of the case.''.

SEC. 203. PROTECTION OF RETIREMENT SAVINGS IN BANKRUPTCY.

    (a) In General.--Section 522 of title 11, United States 
Code, is amended--
            (1) in subsection (b)--
                    (A) in paragraph (2)--
                            (i) by striking ``(2)(A) any 
                        property'' and inserting:
    ``(3) Property listed in this paragraph is--
            ``(A) any property'';
                            (ii) in subparagraph (A), by 
                        striking ``and'' at the end;
                            (iii) in subparagraph (B), by 
                        striking the period at the end and 
                        inserting ``; and''; and
                            (iv) by adding at the end the 
                        following:
            ``(C) retirement funds to the extent that those 
        funds are in a fund or account that is exempt from 
        taxation under section 401, 403, 408, 408A, 414, 457, 
        or 501(a) of the Internal Revenue Code of 1986.'';
                    (B) by striking paragraph (1) and 
                inserting:
    ``(2) Property listed in this paragraph is property that is 
specified under subsection (d), unless the State law that is 
applicable to the debtor under paragraph (3)(A) specifically 
does not so authorize.'';
                    (C) in the matter preceding paragraph (2)--
                            (i) by striking ``(b)'' and 
                        inserting ``(b)(1)'';
                            (ii) by striking ``paragraph (2)'' 
                        both places it appears and inserting 
                        ``paragraph (3)'';
                            (iii) by striking ``paragraph (1)'' 
                        each place it appears and inserting 
                        ``paragraph (2)''; and
                            (iv) by striking ``Such property 
                        is--''; and
                    (D) by adding at the end of the subsection 
                the following:
    ``(4) For purposes of paragraph (3)(C), the following shall 
apply:
            ``(A) If the retirement funds are in a retirement 
        fund that has received a favorable determination 
        pursuant to section 7805 of the Internal Revenue Code 
        of 1986, and that determination is in effect as of the 
        date of the commencement of the case under section 301, 
        302, or 303 of this title, those funds shall be 
        presumed to be exempt from the estate.
            ``(B) If the retirement funds are in a retirement 
        fund that has not received a favorable determination 
        pursuant to such section 7805, those funds are exempt 
        from the estate if the debtor demonstrates that--
                    ``(i) no prior determination to the 
                contrary has been made by a court or the 
                Internal Revenue Service; and
                    ``(ii) the retirement fund is in 
                substantial compliance with the applicable 
                requirements of the Internal Revenue Code of 
                1986.
            ``(C) A direct transfer of retirement funds from 1 
        fund or account that is exempt from taxation under 
        section 401, 403, 408, 408A, 414, 457, or 501(a) of the 
        Internal Revenue Code of 1986, pursuant to section 
        401(a)(31) of the Internal Revenue Code of 1986, or 
        otherwise, shall not cease to qualify for exemption 
        under paragraph (3)(C) by reason of that direct 
        transfer.
            ``(D)(i) Any distribution that qualifies as an 
        eligible rollover distribution within the meaning of 
        section 402(c) of the Internal Revenue Code of 1986 or 
        that is described in clause (ii) shall not cease to 
        qualify for exemption under paragraph (3)(C) by reason 
        of that distribution.
            ``(ii) A distribution described in this clause is 
        an amount that--
                    ``(I) has been distributed from a fund or 
                account that is exempt from taxation under 
                section 401, 403, 408, 408A, 414, 457, or 
                501(a) of the Internal Revenue Code of 1986; 
                and
                    ``(II) to the extent allowed by law, is 
                deposited in such a fund or account not later 
                than 60 days after the distribution of that 
                amount.''; and
            (2) in subsection (d)--
                    (A) in the matter preceding paragraph (1), 
                by striking ``subsection (b)(1)'' and inserting 
                ``subsection (b)(2)''; and
                    (B) by adding at the end the following:
    ``(12) Retirement funds to the extent that those funds are 
in a fund or account that is exempt from taxation under section 
401, 403, 408, 408A, 414, 457, or 501(a) of the Internal 
Revenue Code of 1986.''.
    (b) Automatic Stay.--Section 362(b) of title 11, United 
States Code, as amended by sections 120, 134, 139, and 144 is 
amended--
            (1) in paragraph (27), by striking ``or'' at the 
        end;
            (2) in paragraph (28), by striking the period and 
        inserting ``; or'';
            (3) by inserting after paragraph (28) the 
        following:
            ``(29) under subsection (a), of withholding of 
        income from a debtor's wages and collection of amounts 
        withheld, pursuant to the debtor's agreement 
        authorizing that withholding and collection for the 
        benefit of a pension, profit-sharing, stock bonus, or 
        other plan established under section 401, 403, 408, 
        408A, 414, 457, or 501(a) of the Internal Revenue Code 
        of 1986 that is sponsored by the employer of the 
        debtor, or an affiliate, successor, or predecessor of 
        such employer--
                    ``(A) to the extent that the amounts 
                withheld and collected are used solely for 
                payments relating to a loan from a plan that 
                satisfies the requirements of section 408(b)(1) 
                of the Employee Retirement Income Security Act 
                of 1974 or is subject to section 72(p) of the 
                Internal Revenue Code of 1986; or
                    ``(B) in the case of a loan from a thrift 
                savings plan described in subchapter III of 
                title 5, that satisfies the requirements of 
                section 8433(g) of such title.''; and
            (4) by adding at the end of the flush material 
        following paragraph (19) the following: ``Paragraph 
        (19) does not apply to any amount owed to a plan 
        referred to in that paragraph that is incurred under a 
        loan made during the 1-year period preceding the filing 
        of a petition. Nothing in paragraph (19) may be 
        construed to provide that any loan made under a 
        governmental plan under section 414(d), or a contract 
        or account under section 403(b), of the Internal 
        Revenue Code of 1986 constitutes a claim or a debt 
        under this title.''.
    (c) Exceptions To Discharge.--Section 523(a) of title 11, 
United States Code, is amended--
            (1) by striking ``or'' at the end of paragraph 
        (17);
            (2) by striking the period at the end of paragraph 
        (18) and inserting ``; or''; and
            (3) by adding at the end the following:
            ``(19) owed to a pension, profit-sharing, stock 
        bonus, or other plan established under section 401, 
        403, 408, 408A, 414, 457, or 501(c) of the Internal 
        Revenue Code of 1986, pursuant to--
                    ``(A) a loan permitted under section 
                408(b)(1) of the Employee Retirement Income 
                Security Act of 1974) or subject to section 
                72(p) of the Internal Revenue Code of 1986; or
                    ``(B) a loan from the thrift savings plan 
                described in subchapter III of title 5, that 
                satisfies the requirements of section 8433(g) 
                of such title.
Paragraph (19) does not apply to any amount owed to a plan 
referred to in that paragraph that is incurred under a loan 
made during the 1-year period preceding the filing of a 
petition. Nothing in paragraph (19) may be construed to provide 
that any loan made under a governmental plan under section 
414(d), or a contract or account under section 403(b), of the 
Internal Revenue Code of 1986 constitutes a claim or a debt 
under this title.''.
    (d) Plan Contents.--Section 1322 of title 11, United States 
Code, is amended by adding at the end the following:
    ``(f) A plan may not materially alter the terms of a loan 
described in section 362(b)(19) of this title.''.

SEC. 204. PROTECTION OF REFINANCE OF SECURITY INTEREST.

    Subparagraphs (A), (B), and (C) of section 547(e)(2) of 
title 11, United States Code, are amended by striking ``10'' 
each place it appears and inserting ``30''.

SEC. 205. EXECUTORY CONTRACTS AND UNEXPIRED LEASES.

    Section 365(d)(4) of title 11, United States Code, is 
amended to read as follows:
    ``(4)(A) Subject to subparagraph (B), in any case under any 
chapter of this title, an unexpired lease of nonresidential 
real property under which the debtor is the lessee shall be 
deemed rejected and the trustee shall immediately surrender 
that nonresidential real property to the lessor if the trustee 
does not assume or reject the unexpired lease by the earlier 
of--
            ``(i) the date that is 180 days after the date of 
        the order for relief; or
            ``(ii) the date of the entry of an order confirming 
        a plan.
    ``(B) The court may extend the period determined under 
subparagraph (A) only upon a motion of the lessor.''.

SEC. 206. CREDITORS AND EQUITY SECURITY HOLDERS COMMITTEES.

    Section 1102(a)(2) of title 11, United States Code, is 
amended by inserting before the first sentence the following: 
``On its own motion or on request of a party in interest, and 
after notice and hearing, the court may order a change in the 
membership of a committee appointed under this subsection, if 
the court determines that the change is necessary to ensure 
adequate representation of creditors or equity security 
holders.''.

SEC. 207. AMENDMENT TO SECTION 546 OF TITLE 11, UNITED STATES CODE.

    Section 546 of title 11, United States Code, is amended by 
inserting at the end thereof:
            ``(I) Notwithstanding section 545 (2) and (3) of 
        this title, the trustee may not avoid a warehouseman's 
        lien for storage, transportation or other costs 
        incidental to the storage and handling of goods, as 
        provided by section 7-209 of the Uniform Commercial 
        Code.''.

SEC. 208. LIMITATION.

    Section 546(c)(1)(B) of title 11, United States Code, is 
amended by striking ``20'' and inserting ``45''.

SEC. 209. AMENDMENT TO SECTION 330(A) OF TITLE 11, UNITED STATES CODE.

    Section 330(a) of title 11, United States Code, is 
amended--
            (1) in subsection (3)(A) after the word 
        ``awarded'', by inserting ``to an examiner, chapter 11 
        trustee, or professional person''; and
            (2) by adding at the end of subsection (3)(A) the 
        following:
            ``(3)(B) In determining the amount of reasonable 
        compensation to be awarded a trustee, the court shall 
        treat such compensation as a commission based on the 
        results achieved.''.

SEC. 210. POSTPETITION DISCLOSURE AND SOLICITATION.

    Section 1125 of title 11, United States Code, is amended by 
adding at the end the following:
    ``(g) Notwithstanding subsection (b), an acceptance or 
rejection of the plan may be solicited from a holder of a claim 
or interest if such solicitation complies with applicable 
nonbankruptcy law and if such holder was solicited before the 
commencement of the case in a manner complying with applicable 
nonbankruptcy law.''.

SEC. 211. PREFERENCES.

    Section 547(c) of title 11, United States Code, is 
amended--
            (1) by amending paragraph (2) to read as follows:
            ``(2) to the extent that such transfer was in 
        payment of a debt incurred by the debtor in the 
        ordinary course of business or financial affairs of the 
        debtor and the transferee, and such transfer was--
                    ``(A) made in the ordinary course of 
                business or financial affairs of the debtor and 
                the transferee; or
                    ``(B) made according to ordinary business 
                terms;'';
            (2) in paragraph (7) by striking ``or'' at the end;
            (3) in paragraph (8) by striking the period at the 
        end and inserting ``; or''; and
            (4) by adding at the end the following:
            ``(9) if, in a case filed by a debtor whose debts 
        are not primarily consumer debts, the aggregate value 
        of all property that constitutes or is affected by such 
        transfer is less than $5000.''.

SEC. 212. VENUE OF CERTAIN PROCEEDINGS.

    Section 1409(b) of title 28, United States Code, is amended 
by inserting ``, or a nonconsumer debt against a noninsider of 
less than $10,000,'' after ``$5,000''.

SEC. 213. PERIOD FOR FILING PLAN UNDER CHAPTER 11.

    Section 1121(d) of title 11, United States Code, is 
amended--
            (1) by striking ``On'' and inserting ``(1) Subject 
        to paragraph (1), on''; and
            (2) by adding at the end the following:
    ``(2)(A) Such 120-day period may not be extended beyond a 
date that is 18 months after the date of the order for relief 
under this chapter.
    ``(B) Such 180-day period may not be extended beyond a date 
that is 20 months after the date of the order for relief under 
this chapter.''.

SEC. 214. FEES ARISING FROM CERTAIN OWNERSHIP INTERESTS.

    Section 523(a)(16) of title 11, United States Code, is 
amended--
            (1) by striking ``dwelling'' the first place it 
        appears;
            (2) by striking ``ownership or'' and inserting 
        ``ownership,'';
            (3) by striking ``housing'' the first place it 
        appears; and
            (4) by striking ``but only'' and all that follows 
        through ``such period,'', and inserting ``or a lot in a 
        homeowners association, for as long as the debtor or 
        the trustee has a legal, equitable, or possessory 
        ownership interest in such unit, such corporation, or 
        such lot, and until such time as the debtor or trustee 
        has surrendered any legal, equitable or possessory 
        interest in such unit, such corporation, or such 
        lot,''.

SEC. 215. CLAIMS RELATING TO INSURANCE DEPOSITS IN CASES ANCILLARY TO 
                    FOREIGN PROCEEDINGS.

    Section 304 of title 11, United States Code, is amended to 
read as follows:

``Sec. 304. Cases ancillary to foreign proceedings

    ``(a) For purposes of this section--
            ``(1) the term `domestic insurance company' means a 
        domestic insurance company, as such term is used in 
        section 109(b)(2);
            ``(2) the term `foreign insurance company' means a 
        foreign insurance company, as such term is used in 
        section 109(b)(3);
            ``(3) the term `United States claimant' means a 
        beneficiary of any deposit referred to in subsection 
        (b) or any multibeneficiary trust referred to in 
        subsection (b);
            ``(4) the term `United States creditor' means, with 
        respect to a foreign insurance company--
                    ``(i) a United States claimant; or
                    ``(ii) any business entity that operates in 
                the United States and that is a creditor; and
            ``(5) the term `United States policyholder' means a 
        holder of an insurance policy issued in the United 
        States.
    ``(b) The court may not grant relief under chapter 15 of 
this title with respect to any deposit, escrow, trust fund, or 
other security required or permitted under any applicable State 
insurance law or regulation for the benefit of claim holders in 
the United States.''.

SEC. 215. DEFAULTS BASED ON NONMONETARY OBLIGATIONS.

    (a) Executory Contracts and Unexpired Leases.--Section 365 
of title 11, United States Code, is amended--
            (1) in subsection (b)--
                    (A) in paragraph (1)(A) by striking the 
                semicolon at the end and inserting the 
                following:
        ``other than a default that is a breach of a provision 
        relating to--
                    ``(i) the satisfaction of any provision 
                (other than a penalty rate or penalty 
                provision) relating to a default arising from 
                any failure to perform nonmonetary obligations 
                under an unexpired lease of real property 
                (excluding executory contracts that transfer a 
                right or interest under a filed or issued 
                patent, copyright, trademark, trade dress, or 
                trade secret), if it is impossible for the 
                trustee to cure such default by performing 
                nonmonetary acts at and after the time of 
                assumption; or
                    ``(ii) the satisfaction of any provision 
                (other than a penalty rate or penalty 
                provision) relating to a default arising from 
                any failure to perform nonmonetary obligations 
                under an executory contract, if it is 
                impossible for the trustee to cure such default 
                by performing nonmonetary acts at and after the 
                time of assumption and if the court determines, 
                based on the equities of the case, that this 
                subparagraph should not apply with respect to 
                such default;''; and
                    (B) by amending paragraph (2)(D) to read as 
                follows:
            ``(D) the satisfaction of any penalty rate or 
        penalty provision relating to a default arising from a 
        failure to perform nonmonetary obligations under an 
        executory contract (excluding executory contracts that 
        transfer a right or interest under a filed or issued 
        patent, copyright, trademark, trade dress, or trade 
        secret) or under an unexpired lease of real or personal 
        property.'';
            (2) in subsection (c)--
                    (A) in paragraph (2) by adding ``or'' at 
                the end;
                    (B) in paragraph (3) by striking ``; or'' 
                at the end and inserting a period; and
                    (C) by striking paragraph (4);
            (3) in subsection (d)--
                    (A) by striking paragraphs (5) through (9); 
                and
                    (B) by redesignating paragraph (10) as 
                paragraph (5); and
            (4) in subsection (f)(1) by striking ``; except 
        that'' and all that follows through the end of the 
        paragraph and inserting a period.
    (b) Impairment of Claims or Interests.--Section 1124(2) of 
title 11, United States Code, is amended--
            (1) in subparagraph (A) by inserting ``or of a kind 
        that section 365(b)(1)(A) of this title expressly does 
        not require to be cured'' before the semicolon at the 
        end;
            (2) in subparagraph (C) by striking ``and'' at the 
        end;
            (3) by redesignating subparagraph (D) as 
        subparagraph (E); and
            (4) by inserting after subparagraph (C) the 
        following:
                    ``(D) if such claim or such interest arises 
                from any failure to perform a nonmonetary 
                obligation, compensates the holder of such 
                claim or such interest (other than the debtor 
                or an insider) for any actual pecuniary loss 
                incurred by such holder as a result of such 
                failure; and''.

           TITLE III--GENERAL BUSINESS BANKRUPTCY PROVISIONS

SEC. 301. DEFINITION OF DISINTERESTED PERSON.

    Section 101(14) of title 11, United States Code, is amended 
to read as follows:
            ``(14) `disinterested person' means a person that--
                    ``(A) is not a creditor, an equity security 
                holder, or an insider;
                    ``(B) is not and was not, within 2 years 
                before the date of the filing of the petition, 
                a director, officer, or employee of the debtor; 
                and
                    ``(C) does not have an interest materially 
                adverse to the interest of the estate or of any 
                class of creditors or equity security holders, 
                by reason of any direct or indirect 
                relationship to, connection with, or interest 
                in, the debtor, or for any other reason;''.

SEC. 302. MISCELLANEOUS IMPROVEMENTS.

    (a) Who May Be a Debtor.--Section 109 of title 11, United 
States Code, is amended by adding at the end the following:
    ``(h)(1) Subject to paragraphs (2) and (3) and 
notwithstanding any other provision of this section, an 
individual may not be a debtor under this title unless that 
individual has, during the 90-day period preceding the date of 
filing of the petition of that individual, received credit 
counseling, including, at a minimum, participation in an 
individual or group briefing that outlined the opportunities 
for available credit counseling and assisted that individual in 
performing an initial budget analysis, through a credit 
counseling program (offered through an approved credit 
counseling service described in section 111(a)).
    ``(2)(A) Paragraph (1) shall not apply with respect to a 
debtor who resides in a district for which the United States 
trustee or bankruptcy administrator of the bankruptcy court of 
that district determines that the approved credit counseling 
services for that district are not reasonably able to provide 
adequate services to the additional individuals who would 
otherwise seek credit counselingfrom those programs by reason 
of the requirements of paragraph (1).
    ``(B) Each United States trustee or bankruptcy 
administrator that makes a determination described in 
subparagraph (A) shall review that determination not later than 
one year after the date of that determination, and not less 
frequently than every year thereafter.
    ``(3)(A) Subject to subparagraph (B), the requirements of 
paragraph (1) shall not apply with respect to a debtor who 
submits to the court a certification that--
            ``(i) describes exigent circumstances that merit a 
        waiver of the requirements of paragraph (1);
            ``(ii) states that the debtor requested credit 
        counseling services from an approved credit counseling 
        service, but was unable to obtain the services referred 
        to in paragraph (1) during the 5-day period beginning 
        on the date on which the debtor made that request; and
            ``(iii) is satisfactory to the court.
    ``(B) With respect to a debtor, an exemption under 
subparagraph (A) shall cease to apply to that debtor on the 
date on which the debtor meets the requirements of paragraph 
(1), but in no case may the exemption apply to that debtor 
after the date that is 30 days after the debtor files a 
petition.''.
    (b) Chapter 7 Discharge.--Section 727(a) of title 11, 
United States Code, is amended--
            (1) in paragraph (9), by striking ``or'' at the 
        end;
            (2) in paragraph (10), by striking the period and 
        inserting ``; or''; and
            (3) by adding at the end the following:
            ``(11) after the filing of the petition, the debtor 
        failed to complete an instructional course concerning 
        personal financial management described in section 
        111.''.
    (c) Chapter 13 Discharge.--Section 1328 of title 11, United 
States Code, is amended by adding at the end the following:
    ``(f) The court shall not grant a discharge under this 
section to a debtor, unless after filing a petition the debtor 
has completed an instructional course concerning personal 
financial management described in section 111.
    ``(g) Subsection (f) shall not apply with respect to a 
debtor who resides in a district for which the United States 
trustee or bankruptcy administrator of the bankruptcy court of 
that district determines that the approved instructional 
courses are not adequate to service the additional individuals 
who would be required to complete the instructional course by 
reason of the requirements of this section.
    ``(h) Each United States trustee or bankruptcy 
administrator that makes a determination described in 
subsection (g) shall review that determination not later than 1 
year after the date of that determination, and not less 
frequently than every year thereafter.
    (d) Debtor's Duties.--Section 521 of title 11, United 
States Code, as amended by sections 121, 604, and 122, is 
amended by adding at the end the following:
    ``(d) In addition to the requirements under subsection (a), 
an individual debtor shall file with the court--
            ``(1) a certificate from the credit counseling 
        service that provided the debtor services under section 
        109(h); and
            ``(2) a copy of the debt repayment plan, if any, 
        developed under section 109(h) through the credit 
        counseling service referred to in paragraph (1).''.
    (e) Exceptions to Discharge.--Section 523(d) of title 11, 
United States Code, as amended by section 202 of this Act, is 
amended by striking paragraph (3)(A)(i) and inserting the 
following:
            ``(i) within the applicable period of time 
        prescribed under section 109(h), the debtor received 
        credit counseling through a credit counseling program 
        in accordance with section 109(h); and''.
    (f) General Provisions.--
            (1) In general.--Chapter 1 of title 11, United 
        States Code, is amended by adding at the end the 
        following:

``Sec. 111. Credit counseling services; financial management 
                    instructional courses

    ``(a) The clerk of each district shall maintain a list of 
credit counseling services that provide 1 or more programs 
described in section 109(h) and a list of instructional courses 
concerning personal financial management that have been 
approved by--
            ``(1) the United States trustee; or
            ``(2) the bankruptcy administrator for the 
        district.''.
            (2) Clerical amendment.--The table of sections at 
        the beginning of chapter 1 of title 11, United States 
        Code, is amended by adding at the end the following:

``111. Credit counseling services; financial management instructional 
          courses.''.

    (g) Definitions.--Section 101 of title 11, United States 
Code, as amended by section 317 of this Act, is amended--
            (1) by inserting after paragraph (13) the 
        following:
            ``(13A) `debtor's principal residence'--
                    ``(A) means a residential structure, 
                including incidental property, without regard 
                to whether that structure is attached to real 
                property; and
                    ``(B) includes an individual condominium or 
                cooperative unit;''; and
            (2) by inserting after paragraph (27A), as added by 
        section 318 of this Act, the following:
            ``(27B) `incidental property' means, with respect 
        to a debtor's principal residence--
                    ``(A) property commonly conveyed with a 
                principal residence in the area where the real 
                estate is located;
                    ``(B) all easements, rights, appurtenances, 
                fixtures, rents, royalties, mineral rights, oil 
                or gas rights or profits, water rights, escrow 
                funds, or insurance proceeds; and
                    ``(C) all replacements or additions;''.
    (h) Limitation.--Section 362 of title 11, United States 
Code, is amended by adding at the end the following:
    ``(j) If 1 case commenced under chapter 7, 11, or 13 of 
this title is dismissed due to the creation of a debt repayment 
plan, then for purposes of section 362(c)(3) of this title the 
subsequent case commenced under any such chapter shall not be 
presumed to be filed not in good faith.''.

SEC. 303. EXTENSIONS.

    Section 302(d)(3) of the Bankruptcy, Judges, United States 
Trustees, and Family Farmer Bankruptcy Act of 1986 (28 U.S.C. 
581 note) is amended--
            (1) in subparagraph (A), in the matter following 
        clause (ii), by striking ``or October 1, 2002, 
        whichever occurs first''; and
            (2) in subparagraph (F)--
                    (A) in clause (i)--
                            (i) in subclause (II), by striking 
                        ``or October 1, 2002, whichever occurs 
                        first''; and
                            (ii) in the matter following 
                        subclause (II), by striking ``October 
                        1, 2003, or''; and
                    (B) in clause (ii), in the matter following 
                subclause (II)--
                            (i) by striking ``before October 1, 
                        2003, or''; and
                            (ii) by striking ``, whichever 
                        occurs first''.

             TITLE IV--SMALL BUSINESS BANKRUPTCY PROVISIONS

SEC. 401. FLEXIBLE RULES FOR DISCLOSURE STATEMENT AND PLAN.

    Section 1125(f) of title 11, United States Code, is amended 
to read as follows:
    ``(f) Notwithstanding subsection (b), in a small business 
case--
            ``(1) in determining whether a disclosure statement 
        provides adequate information, the court shall consider 
        the complexity of the case, the benefit of additional 
        information to creditors and other parties in interest, 
        and the cost of providing additional information;
            ``(2) the court may determine that the plan itself 
        provides adequate information and that a separate 
        disclosure statement is not necessary;
            ``(3) the court may approve a disclosure statement 
        submitted on standard forms approved by the court or 
        adopted pursuant to section 2075 of title 28; and
            ``(4)(A) the court may conditionally approve a 
        disclosure statement subject to final approval after 
        notice and a hearing;
            ``(B) acceptances and rejections of a plan may be 
        solicited based on a conditionally approved disclosure 
        statement if the debtor provides adequate information 
        to each holder of a claim or interest that is 
        solicited, but a conditionally approved disclosure 
        statement shall be mailed not less than 20 days before 
        the date of the hearing on confirmation of the plan; 
        and
            ``(C) the hearing on the disclosure statement may 
        be combined with the hearing on confirmation of a 
        plan.''.

SEC. 402. DEFINITIONS.

    (a) Definitions.--Section 101 of title 11, United States 
Code, is amended by striking paragraph (51C) and inserting the 
following:
            ``(51C) `small business case' means a case filed 
        under chapter 11 of this title in which the debtor is a 
        small business debtor;
            ``(51D) `small business debtor' means--
                    ``(A) a person (including affiliates of 
                such person that are also debtors under this 
                title) that has aggregate noncontingent, 
                liquidated secured and unsecured debts as of 
                the date of the petition or the order for 
                relief in an amount not more than $4,000,000 
                (excluding debts owed to 1 or more affiliates 
                or insiders) a case in which the United States 
                trustee has appointed under section 1102(a)(1) 
                of this title a committee of unsecured 
                creditors that `the court has determined' is 
                sufficiently active and representative to 
                provide effective oversight of the debtor, 
                except that if a group of affiliated debtors 
                has aggregate noncontingent liquidated secured 
                and unsecured debts greater than $4,000,000 
                (excluding debt owed to 1 or more affiliates or 
                insiders), then no member of such group is a 
                small business debtor;''.
    (b) Effect of Discharge.--Section 524 of title 11, United 
States Code, as amended by section 402, is amended by adding at 
the end the following:
    ``(k)(1) An individual who is injured by the willful 
failure of a creditor to substantially comply with the 
requirements specified in subsections (c) and (d), or by any 
willful violation of the injunction operating under subsection 
(a)(2), shall be entitled to recover--
            ``(A) the greater of--
                    ``(i) the amount of actual damages; or
                    ``(ii) $1,000; and
            ``(B) costs and attorneys' fees.
    ``(2) An action to recover for a violation specified in 
paragraph (1) may not be brought as a class action.''.
    (c) Conforming Amendment.--Section 1102(a)(3) of title 11, 
United States Code, is amended by inserting ``debtor'' after 
``small business''.

SEC. 403. STANDARD FORM DISCLOSURE STATEMENT AND PLAN.

    The Advisory Committee on Bankruptcy Rules of the Judicial 
Conference of the United States shall, within a reasonable 
period of time after the date of the enactment of this Act, 
propose for adoption standard form disclosure statements and 
plans of reorganization for small business debtors (as defined 
in section 101 of title 11, United States Code, as amended by 
this Act), designed to achieve a practical balance between--
            (1) the reasonable needs of the courts, the United 
        States trustee, creditors, and other parties in 
        interest for reasonably complete information; and
            (2) economy and simplicity for debtors.

SEC. 404. UNIFORM NATIONAL REPORTING REQUIREMENTS.

    (a) Reporting Required.--(1) Title 11 of the United States 
Code is amended by inserting after section 307 the following:

``Sec. 308. Debtor reporting requirements

    ``A small business debtor shall file periodic financial and 
other reports containing information including--
            ``(1) the debtor's profitability, that is, 
        approximately how much money the debtor has been 
        earning or losing during current and recent fiscal 
        periods;
            ``(2) reasonable approximations of the debtor's 
        projected cash receipts and cash disbursements over a 
        reasonable period;
            ``(3) comparisons of actual cash receipts and 
        disbursements with projections in prior reports;
            ``(4) whether the debtor is--
                    ``(A) in compliance in all material 
                respects with postpetition requirements imposed 
                by this title and the Federal Rules of 
                Bankruptcy Procedure; and
                    ``(B) timely filing tax returns and paying 
                taxes and other administrative claims when due, 
                and, if not, what the failures are and how, at 
                what cost, and when the debtor intends to 
                remedy such failures; and
            ``(5) such other matters as are in the best 
        interests of the debtor and creditors, and in the 
        public interest in fair and efficient procedures under 
        chapter 11 of this title.''.
    (2) The table of sections of chapter 3 of title 11, United 
States Code, is amended by inserting after the item relating to 
section 307 the following:

``308. Debtor reporting requirements.''.

    (b) Effective Date.--The amendments made by subsection (a) 
shall take effect 60 days after the date on which rules are 
prescribed pursuant to section 2075, title 28, United States 
Code to establish forms to be used to comply with section 308 
of title 11, United States Code, as added by subsection (a).

SEC. 405. UNIFORM REPORTING RULES AND FORMS FOR SMALL BUSINESS CASES.

    (a) Proposal of Rules and Forms.--The Advisory Committee on 
Bankruptcy Rules of the Judicial Conference of the United 
States shall propose for adoption amended Federal Rules of 
Bankruptcy Procedure and Official Bankruptcy Forms to be used 
by small business debtors to file periodic financial and other 
reports containing information, including information relating 
to--
            (1) the debtor's profitability;
            (2) the debtor's cash receipts and disbursements; 
        and
            (3) whether the debtor is timely filing tax returns 
        and paying taxes and other administrative claims when 
        due.
    (b) Purpose.--The rules and forms proposed under subsection 
(a) shall be designed to achieve a practical balance between--
            (1) the reasonable needs of the bankruptcy court, 
        the United States trustee, creditors, and other parties 
        in interest for reasonably complete information;
            (2) the small business debtor's interest that 
        required reports be easy and inexpensive to complete; 
        and
            (3) the interest of all parties that the required 
        reports help the small business debtor to understand 
        its financial condition and plan its future.

SEC. 406. DUTIES IN SMALL BUSINESS CASES.

    (a) Duties in Chapter 11 Cases.--Title 11 of the United 
States Code is amended by inserting after section 1114 the 
following:

``Sec. 1115. Duties of trustee or debtor in possession in small 
                    business cases

    ``In a small business case, a trustee or the debtor in 
possession, in addition to the duties provided in this title 
and as otherwise required by law, shall--
            ``(1) append to the voluntary petition or, in an 
        involuntary case, file within 3 days after the date of 
        the order for relief--
                    ``(A) its most recent balance sheet, 
                statement of operations, cash-flow statement, 
                Federal income tax return; or
                    ``(B) a statement made under penalty of 
                perjury that no balance sheet, statement of 
                operations, or cash-flow statement has been 
                prepared and no Federal tax return has been 
                filed;
            ``(2) attend, through its senior management 
        personnel and counsel, meetings scheduled by the court 
        or the United States trustee, including initial debtor 
        interviews, scheduling conferences, and meetings of 
        creditors convened under section 341 of this title 
        unless the court waives this requirement after notice 
        and hearing, upon a finding of extraordinary and 
        compelling circumstances;
            ``(3) timely file all schedules and statements of 
        financial affairs, unless the court, after notice and a 
        hearing, grants an extension, which shall not extend 
        such time period to a date later than 30 days after the 
        date of the order for relief, absent extraordinary and 
        compelling circumstances;
            ``(4) file all postpetition financial and other 
        reports required by the Federal Rules of Bankruptcy 
        Procedure or by local rule of the district court;
            ``(5) subject to section 363(c)(2) of this title, 
        maintain insurance customary and appropriate to the 
        industry;
            ``(6)(A) timely file tax returns;
            ``(B) subject to section 363(c)(2) of this title, 
        timely pay all administrative expense tax claims, 
        except those being contested by appropriate proceedings 
        being diligently prosecuted; and
            ``(C) subject to section 363(c)(2) of this title, 
        establish 1 or more separate deposit accounts not later 
        than 10 business days after the date of order for 
        relief (or as soon thereafter as possible if all banks 
        contacted decline the business) and deposit therein, 
        not later than 1 business day after receipt thereof, 
        all taxes payable for periods beginning after the date 
        the case is commenced that are collected or withheld by 
        the debtor for governmental units unless the court 
        waives this requirement after notice and hearing, upon 
        a finding of extraordinary and compelling 
        circumstances; and
            ``(7) allow the United States trustee, or its 
        designated representative, to inspect the debtor's 
        business premises, books, and records at reasonable 
        times, after reasonable prior written notice, unless 
        notice is waived by the debtor.''.
    (b) Technical Amendment.--The table of sections of chapter 
11, United States Code, is amended by inserting after the item 
relating to section 1114 the following:

``1115. Duties of trustee or debtor in possession in small business 
          cases.''.

SEC. 407. PLAN FILING AND CONFIRMATION DEADLINES.

    Section 1121(e) of title 11, United States Code, is amended 
to read as follows:
    ``(e) In a small business case--
            ``(1) only the debtor may file a plan until after 
        90 days after the date of the order for relief, unless 
        shortened on request of a party in interest made during 
        the 90-day period, or unless extended as provided by 
        this subsection, after notice and hearing the court, 
        for cause, orders otherwise;
            ``(2) the plan, and any necessary disclosure 
        statement, shall be filed not later than 90 days after 
        the date of the order for relief; and
            ``(3) the time periods specified in paragraphs (1) 
        and (2), and the time fixed in section 1129(e) of this 
        title, within which the plan shall be confirmed may be 
        extended only if--
                    ``(A) the debtor, after providing notice to 
                parties in interest (including the United 
                States trustee), demonstrates by a 
                preponderance of the evidence that it is more 
                likely than not that the court will confirm a 
                plan within a reasonable time;
                    ``(B) a new deadline is imposed at the time 
                the extension is granted; and
                    ``(C) the order extending time is signed 
                before the existing deadline has expired.''.

SEC. 408. PLAN CONFIRMATION DEADLINE.

    Section 1129 of title 11, United States Code, is amended by 
adding at the end the following:
    ``(e) In a small business case, the plan shall be confirmed 
not later than 150 days after the date of the order for relief 
unless such 150-day period is extended as provided in section 
1121(e)(3) of this title.''.

SEC. 409. PROHIBITION AGAINST EXTENSION OF TIME.

    Section 105(d) of title 11, United States Code, is 
amended--
            (1) in paragraph (2)(B)(vi) by striking the period 
        at the end and inserting ``; and''; and
            (2) by adding at the end the following:
            ``(3) in a small business case, not extend the time 
        periods specified in sections 1121(e) and 1129(e) of 
        this title except as provided in section 1121(e)(3) of 
        this title.''.

SEC. 410. DUTIES OF THE UNITED STATES TRUSTEE.

    (a) Duties of the United States Trustee.--Section 586(a) of 
title 28, United States Code, is amended--
            (1) in paragraph (3)--
                    (A) in subparagraph (G) by striking ``and'' 
                at the end;
                    (B) by redesignating subparagraph (H) as 
                subparagraph (I); and
                    (C) by inserting after subparagraph (G) the 
                following:
                    ``(H) in small business cases (as defined 
                in section 101 of title 11), performing the 
                additional duties specified in title 11 
                pertaining to such cases;'';
            (2) in paragraph (6) by striking ``and'' at the 
        end;
            (3) in paragraph (7) by striking the period at the 
        end and inserting ``; and''; and
            (4) by inserting after paragraph (7) the following:
            ``(8) in each of such small business cases--
                    ``(A) conduct an initial debtor interview 
                as soon as practicable after the entry of order 
                for relief but before the first meeting 
                scheduled under section 341(a) of title 11 at 
                which time the United States trustee shall 
                begin to investigate the debtor's viability, 
                inquire about the debtor's business plan, 
                explain the debtor's obligations to file 
                monthly operating reports and other required 
                reports, attempt to develop an agreed 
                scheduling order, and inform the debtor of 
                other obligations;
                    ``(B) when determined to be appropriate and 
                advisable, visit the appropriate business 
                premises of the debtor and ascertain the state 
                of the debtor's books and records and verify 
                that the debtor has filed its tax returns; and
                    ``(C) review and monitor diligently the 
                debtor's activities, to identify as promptly as 
                possible whether the debtor will be unable to 
                confirm a plan; and
            ``(9) in cases in which the United States trustee 
        finds material grounds for any relief under section 
        1112 of title 11, the United States trustee shall apply 
        promptly to the court for relief.''.

SEC. 411. SCHEDULING CONFERENCES.

    Section 105(d) of title 11, United States Code, is 
amended--
            (1) in the matter preceding paragraph (1) by 
        striking ``, may'';
            (2) by amending paragraph (1) to read as follows:
            ``(1) shall hold such status conferences as are 
        necessary to further the expeditious and economical 
        resolution of the case; and''; and
            (3) in paragraph (2) by striking ``unless 
        inconsistent with another provision of this title or 
        with applicable Federal Rules of Bankruptcy 
        Procedure,'' and inserting ``may''.

SEC. 412. SERIAL FILER PROVISIONS.

    Section 362 of title 11, United States Code, is amended--
            (1) in subsection (i) as so redesignated by section 
        124--
                    (A) by striking ``An'' and inserting ``(1) 
                Except as provided in paragraph (2), an''; and
                    (B) by adding at the end the following:
    ``(2) If such violation is based on an action taken by an 
entity in the good-faith belief that subsection (h) applies to 
the debtor, then recovery under paragraph (1) against such 
entity shall be limited to actual damages.''; and
            (2) by inserting after subsection (i), as 
        redesignated by section 124, the following:
    ``(j) The filing of a petition under chapter 11 of this 
title operates as a stay of the acts described in subsection 
(a) only in an involuntary case involving no collusion by the 
debtor with creditors and in which the debtor--
            ``(1) is a debtor in a small business case pending 
        at the time the petition is filed;
            ``(2) was a debtor in a small business case which 
        was dismissed for any reason by an order that became 
        final in the 2-year period ending on the date of the 
        order for relief entered with respect to the petition;
            ``(3) was a debtor in a small business case in 
        which a plan was confirmed in the 2-year period ending 
        on the date of the order for relief entered with 
        respect to the petition; or
            ``(4) is an entity that has succeeded to 
        substantially all of the assets or business of a small 
        business debtor described in subparagraph (A), (B), or 
        (C); unless the debtor proves, by a preponderance of 
        the evidence, that the filing of such petition resulted 
        from circumstances beyond the control of the debtor not 
        foreseeable at the time the case then pending was 
        filed; and that it is more likely than not that the 
        court will confirm a feasible plan, but not a 
        liquidating plan, within a reasonable time.''.

SEC. 413. EXPANDED GROUNDS FOR DISMISSAL OR CONVERSION AND APPOINTMENT 
                    OF TRUSTEE.

    (a) Expanded Grounds for Dismissal or Conversion.--Section 
1112(b) of title 11, United States Code, is amended to read as 
follows:
    ``(b)(1) Except as provided in paragraph (2), in subsection 
(c), and in section 1104(a)(3) of this title, on request of a 
party in interest, and after notice and a hearing, the court 
shall convert a case under this chapter to a case under chapter 
7 of this title or dismiss a case under this chapter, whichever 
is in the best interest of creditors and the estate, if the 
movant establishes cause.
    ``(2) The relief provided in paragraph (1) shall not be 
granted if the debtor or another party in interest objects and 
establishes, by a preponderance of the evidence that--
            ``(A) it is more likely than not that a plan will 
        be confirmed within a time as fixed by this title or by 
        order of the court entered pursuant to section 
        1121(e)(3), or within a reasonable time if no time has 
        been fixed; and
            ``(B) if the reason is an act or omission of the 
        debtor that--
                    ``(i) there exists a reasonable 
                justification for the act or omission; and
                    ``(ii) the act or omission will be cured 
                within a reasonable time fixed by the court not 
                to exceed 30 days after the court decides the 
                motion, unless the movant expressly consents to 
                a continuance for a specific period of time, or 
                compelling circumstances beyond the control of 
                the debtor justify an extension.
    ``(3) For purposes of this subsection, cause includes--
            ``(A) substantial or continuing loss to or 
        diminution of the estate;
            ``(B) gross mismanagement of the estate;
            ``(C) failure to maintain appropriate insurance;
            ``(D) unauthorized use of cash collateral harmful 
        to 1 or more creditors;
            ``(E) failure to comply with an order of the court;
            ``(F) failure timely to satisfy any filing or 
        reporting requirement established by this title or by 
        any rule applicable to a case under this chapter;
            ``(G) failure to attend the meeting of creditors 
        convened under section 341(a) of this title or an 
        examination ordered under rule 2004 of the Federal 
        Rules of Bankruptcy Procedure;
            ``(H) failure timely to provide information or 
        attend meetings reasonably requested by the United 
        States trustee;
            ``(I) failure timely to pay taxes due after the 
        date of the order for relief or to file tax returns due 
        after the order for relief;
            ``(J) failure to file a disclosure statement, or to 
        file or confirm a plan, within the time fixed by this 
        title or by order of the court;
            ``(K) failure to pay any fees or charges required 
        under chapter 123 of title 28;
            ``(L) revocation of an order of confirmation under 
        section 1144 of this title;
            ``(M) inability to effectuate substantial 
        consummation of a confirmed plan;
            ``(N) material default by the debtor with respect 
        to a confirmed plan; and
            ``(O) termination of a plan by reason of the 
        occurrence of a condition specified in the plan.
    ``(4) The court shall commence the hearing on any motion 
under this subsection not later than 30 days after filing of 
the motion, and shall decide the motion within 15 days after 
commencement of the hearing, unless the movant expressly 
consents to a continuance for a specific period of time or 
compelling circumstances prevent the court from meeting the 
time limits established by this paragraph.''.
    (b) Additional Grounds for Appointment of Trustee.--Section 
1104(a) of title 11, United States Code, is amended--
            (1) in paragraph (1) by striking ``or'' at the end;
            (2) in paragraph (2) by striking the period at the 
        end and inserting ``; or''; and
            (3) by adding at the end the following:
            ``(3) if grounds exist to convert or dismiss the 
        case under section 1112 of this title, but the court 
        determines that the appointment of a trustee is in the 
        best interests of creditors and the estate.''.

SEC. 414. STUDY OF OPERATION OF TITLE 11 OF THE UNITED STATES CODE WITH 
                    RESPECT TO SMALL BUSINESSES.

    Not later than 2 years after the date of the enactment of 
this Act, the Administrator of the Small Business 
Administration, in consultation with the Attorney General, the 
Director of the Administrative Office of United States 
Trustees, and the Director of the Administrative Office of the 
United States Courts, shall--
            (1) conduct a study to determine--
                    (A) the internal and external factors that 
                cause small businesses, especially sole 
                proprietorships, to become debtors in cases 
                under title 11 of the United States Code and 
                that cause certain small businesses to 
                successfully complete cases under chapter 11 of 
                such title; and
                    (B) how Federal laws relating to bankruptcy 
                may be made more effective and efficient in 
                assisting small businesses to remain viable; 
                and
            (2) submit to the President pro tempore of the 
        Senate and the Speaker of the House of Representatives 
        a report summarizing that study.

SEC. 415. PAYMENT OF INTEREST.

    Section 362(d)(3) of title 11, United States Code, is 
amended--
            (1) by inserting ``or 30 days after the court 
        determines that the debtor is subject to this 
        paragraph, whichever is later'' after ``90-day 
        period)''; and
            (2) by amending subparagraph (B) to read as 
        follows:
                    ``(B) the debtor has commenced monthly 
                payments (which payments may, in the debtor's 
                sole discretion, notwithstanding section 
                363(c)(2) of this title, be made from rents or 
                other income generated before or after the 
                commencement of the case by or from the 
                property) to each creditor whose claim is 
                secured by such real estate (other than a claim 
                secured by a judgment lien or by an unmatured 
                statutory lien), which payments are in an 
                amount equal to interest at the then-applicable 
                nondefault contract rate of interest on the 
                value of the creditor's interest in the real 
                estate; or''.

                TITLE V--MUNICIPAL BANKRUPTCY PROVISIONS

SEC. 501. PETITION AND PROCEEDINGS RELATED TO PETITION.

    (a) Technical Amendment Relating to Municipalities.--
Section 921(d) of title 11, United States Code, is amended by 
inserting ``notwithstanding section 301(b)'' before the period 
at the end.
    (b) Conforming Amendment.--Section 301 of title 11, United 
States Code, is amended--
            (1) by inserting ``(a)'' before ``A voluntary''; 
        and
            (2) by amending the last sentence to read as 
        follows:
    ``(b) The commencement of a voluntary case under a chapter 
of this title constitutes an order for relief under such 
chapter.''.

SEC. 502. APPLICABILITY OF OTHER SECTIONS TO CHAPTER 9.

    Section 901 of title 11, United States Code, is amended--
            (1) by inserting ``555, 556,'' after ``553,''; and
            (2) by inserting ``559, 560,'' after ``557,''.

              TITLE VI--STREAMLINING THE BANKRUPTCY SYSTEM

SEC. 601. CREDITOR REPRESENTATION AT FIRST MEETING OF CREDITORS.

    Section 341(c) of title 11, United States Code, is amended 
by inserting after the first sentence the following: 
``Notwithstanding any local court rule, provision of a State 
constitution, any other Federal or State law that is not a 
bankruptcy law, or other requirement that representation at the 
meeting of creditors under subsection (a) be by an attorney, a 
creditor holding a consumer debt or any representative of the 
creditor (which may include an entity or an employee of an 
entity and may be a representative for more than one creditor) 
shall be permitted to appear at and participate in the meeting 
of creditors in a case under chapter 7 or 13, either alone or 
in conjunction with an attorney for the creditor. Nothing in 
this subsection shall be construed to require any creditor to 
be represented by an attorney at any meeting of creditors.''.

SEC. 602. AUDIT PROCEDURES.

    (a) Amendments.--Section 586 of title 28, United States 
Code, is amended--
            (1) in subsection (a) by amending striking 
        paragraph (6) to read as follows:
            ``(6) make such reports as the Attorney General 
        directs, including the results of audits performed 
        under subsection (f); and''; and
            (2) by adding at the end the following:
    ``(f)(1)(A) The Attorney General shall establish procedures 
to determine the accuracy, veracity, and completeness of 
petitions, schedules, and other information which the debtor is 
required to provide under sections 521 and 1322 of title 11, 
and, if applicable, section 111 of title 11, in individual 
cases filed under chapter 7 or 13 of such title. Such audits 
shall be in accordance with generally accepted auditing 
standards and performed by independent certified public 
accountants or independent licensed public accountants.
    ``(B) Those procedures shall--
            ``(i) establish a method of selecting appropriate 
        qualified persons to contract to perform those audits;
            ``(ii) establish a method of randomly selecting 
        cases to be audited, except that not less than 1 out of 
        every 250 cases in each Federal judicial district shall 
        be selected for audit;
            ``(iii) require audits for schedules of income and 
        expenses which reflect greater than average variances 
        from the statistical norm of the district in which the 
        schedules were filed; and
            ``(iv) establish procedures for providing, not less 
        frequently than annually, public information concerning 
        the aggregate results of such audits including the 
        percentage of cases, by district, in which a material 
        misstatement of income or expenditures is reported.
    ``(2) The United States trustee for each district is 
authorized to contract with auditors to perform audits in cases 
designated by the United States trustee according to the 
procedures established under paragraph (1).
    ``(3)(A) The report of each audit conducted under this 
subsection shall be filed with the court and transmitted to the 
United States trustee. Each report shall clearly and 
conspicuously specify any material misstatement ofincome or 
expenditures or of assets identified by the person performing the 
audit. In any case where a material misstatement of income or 
expenditures or of assets has been reported, the clerk of the 
bankruptcy court shall give notice of the misstatement to the creditors 
in the case.
    ``(B) If a material misstatement of income or expenditures 
or of assets is reported, the United States trustee shall--
            ``(i) report the material misstatement, if 
        appropriate, to the United States Attorney pursuant to 
        section 3057 of title 18, United States Code; and
            ``(ii) if advisable, take appropriate action, 
        including but not limited to commencing an adversary 
        proceeding to revoke the debtor's discharge pursuant to 
        section 727(d) of title 11, United States Code.''.
    (b) Amendments to Section 521 of Title 11, U.S.C.--Section 
521(a) of title 11, United States Code, as amended by section 
604, is amended in paragraphs (3) and (4) by adding ``or an 
auditor appointed pursuant to section 586 of title 28, United 
States Code'' after ``serving in the case''.
    (c) Amendments to Section 727 of Title 11, U.S.C.--Section 
727(d) of title 11, United States Code, is amended--
            (1) by deleting ``or'' at the end of paragraph (2);
            (2) by substituting ``; or'' for the period at the 
        end of paragraph (3); and
            (3) by adding the following at the end the 
        following:
            ``(4) the debtor has failed to explain 
        satisfactorily--
                    ``(A) a material misstatement in an audit 
                performed pursuant to section 586(f) of title 
                28, United States Code; or
                    ``(B) a failure to make available for 
                inspection all necessary accounts, papers, 
                documents, financial records, files, and all 
                other papers, things, or property belonging to 
                the debtor that are requested for an audit 
                conducted pursuant to section 586(f) of title 
                28, United States Code.''.
    (d) Effective Date.--The amendments made by this section 
shall take effect 18 months after the date of enactment of this 
Act.

SEC. 603. GIVING CREDITORS FAIR NOTICE IN CHAPTER 7 AND 13 CASES.

    (a) Notice.--Section 342 of title 11, United States Code, 
is amended--
            (1) in subsection (c)--
                    (A) by striking ``, but the failure of such 
                notice to contain such information shall not 
                invalidate the legal effect of such notice''; 
                and
                    (B) by adding the following at the end:

``If the credit agreement between the debtor and the creditor 
or the last communication before the filing of the petition in 
a voluntary case from the creditor to a debtor who is an 
individual states an account number of the debtor which is the 
current account number of the debtor with respect to any debt 
held by the creditor against the debtor, the debtor shall 
include such account number in any notice to the creditor 
required to be given under this title. If the creditor has 
specified to the debtor an address at which the creditor wishes 
to receive correspondence regarding the debtor's account, any 
notice to the creditor required to be given by the debtor under 
this title shall be given at such address. For the purposes of 
this section, `notice' shall include, but shall not be limited 
to, any correspondence from the debtor to the creditor after 
the commencement of the case, any statement of the debtor's 
intention under section 521(a)(2) of this title, notice of the 
commencement of any proceeding in the case to which the 
creditor is a party, and any notice of the hearing under 
section 1324 of this title.'';
            (2) by adding at the end the following:
    ``(d) At any time, a creditor in a case of an individual 
debtor under chapter 7 or 13 may file with the court and serve 
on the debtor a notice of the address to be used to notify the 
creditor in that case. Five days after receipt of such notice, 
if the court or the debtor is required to give the creditor 
notice, such notice shall be given at that address.
    ``(e) An entity may file with the court a notice stating 
its address for notice in cases under chapters 7 and 13. After 
30 days following the filing of such notice, any notice in any 
case filed under chapter 7 or 13 given by the court shall be to 
that address unless specific notice is given under subsection 
(d) with respect to a particular case.
    ``(f) Notice given to a creditor other than as provided in 
this section shall not be effective notice until it has been 
brought to the attention of the creditor. If the creditor has 
designated a person or department to be responsible for 
receiving notices concerning bankruptcy cases and has 
established reasonable procedures so that bankruptcy notices 
received by the creditor will be delivered to such department 
or person, notice will not be brought to the attention of the 
creditor until received by such person or department. No 
sanction under section 362(h) of this title or any other 
sanction which a court may impose on account of violations of 
the stay under section 362(a) of this title or failure to 
comply with section 542 or 543 of this title may be imposed on 
any action of the creditor unless the action takes place after 
the creditor has received notice of the commencement of the 
case effective under this section.''.
    (b) Debtor's Duties.--Section 521 of title 11, United 
States Code, as amended by sections 121, 604, 122, 301, and 
302, is amended--
            (1) by inserting ``(a)'' before ``The debtor 
        shall--'';
            (2) by striking paragraph (1) and inserting the 
        following:
            ``(1) file--
                    ``(A) a list of creditors; and
                    ``(B) unless the court orders otherwise--
                            ``(i) a schedule of assets and 
                        liabilities;
                            ``(ii) a schedule of current income 
                        and current expenditures;
                            ``(iii) a statement of the debtor's 
                        financial affairs and, if applicable, a 
                        certificate--
                                    ``(I) of an attorney whose 
                                name is on the petition as the 
                                attorney forthe debtor or any 
bankruptcy petition preparer signing the petition pursuant to section 
110(b)(1) of this title indicating that such attorney or bankruptcy 
petition preparer delivered to the debtor any notice required by 
section 342(b) of this title; or
                                    ``(II) if no attorney for 
                                the debtor is indicated and no 
                                bankruptcy petition preparer 
                                signed the petition, of the 
                                debtor that such notice was 
                                obtained and read by the 
                                debtor;
                            ``(iv) copies of any Federal tax 
                        returns, including any schedules or 
                        attachments, filed by the debtor for 
                        the 3-year period preceding the order 
                        for relief;
                            ``(v) copies of all payment advices 
                        or other evidence of payment, if any, 
                        received by the debtor from any 
                        employer of the debtor in the period 60 
                        days prior to the filing of the 
                        petition;
                            ``(vi) a statement of the amount of 
                        projected monthly net income, itemized 
                        to show how calculated; and
                            ``(vii) a statement disclosing any 
                        reasonably anticipated increase in 
                        income or expenditures over the 12-
                        month period following the date of 
                        filing;''; and
            (3) by adding at the end the following:
    ``(e)(1) At any time, a creditor, in the case of an 
individual under chapter 7 or 13, may file with the court 
notice that the creditor requests the petition, schedules, and 
a statement of affairs filed by the debtor in the case and the 
court shall make those documents available to the creditor who 
requests those documents.
    ``(2) At any time, a creditor in a case under chapter 13 
may file with the court notice that the creditor requests the 
plan filed by the debtor in the case, and the court shall make 
such plan available to the creditor who requests such plan at a 
reasonable cost and not later than 5 days after such request.
    ``(f) An individual debtor in a case under chapter 7 or 13 
shall file with the court--
            ``(1) at the time filed with the taxing authority, 
        all tax returns, including any schedules or 
        attachments, with respect to the period from the 
        commencement of the case until such time as the case is 
        closed;
            ``(2) at the time filed with the taxing authority, 
        all tax returns, including any schedules or 
        attachments, that were not filed with the taxing 
        authority when the schedules under subsection (a)(1) 
        were filed with respect to the period that is 3 years 
        before the order for relief;
            ``(3) any amendments to any of the tax returns, 
        including schedules or attachments, described in 
        paragraph (1) or (2); and
            ``(4) in a case under chapter 13, a statement 
        subject to the penalties of perjury by the debtor of 
        the debtor's income and expenditures in the preceding 
        tax year and monthly income, that shows how the amounts 
        are calculated--
                    ``(A) beginning on the date that is the 
                later of 90 days after the close of the 
                debtor's tax year or 1 year after the order for 
                relief, unless a plan has been confirmed; and
                    ``(B) thereafter, on or before the date 
                that is 45 days before each anniversary of the 
                confirmation of the plan until the case is 
                closed.
    ``(d)(1) A statement referred to in subsection (c)(4) shall 
disclose--
            ``(A) the amount and sources of income of the 
        debtor;
            ``(B) the identity of any persons responsible with 
        the debtor for the support of any dependents of the 
        debtor; and
            ``(C) the identity of any persons who contributed, 
        and the amount contributed, to the household in which 
        the debtor resides.
    ``(2) The tax returns, amendments, and statement of income 
and expenditures described in paragraph (1) shall be available 
to the United States trustee, any bankruptcy administrator, any 
trustee, and any party in interest for inspection and copying, 
subject to the requirements of subsection (e).
    ``(g)(1) Not later than 30 days after the date of enactment 
of the Consumer Bankruptcy Reform Act of 1998, the Director of 
the Administrative Office of the United States Courts shall 
establish procedures for safeguarding the confidentiality of 
any tax information required to be provided under this section.
    ``(2) The procedures under paragraph (1) shall include 
restrictions on creditor access to tax information that is 
required to be provided under this section.
    ``(3) Not later than 1 year after the date of enactment of 
the Consumer Bankruptcy Reform Act of 1998, the Director of the 
Administrative Office of the United States Courts shall 
prepare, and submit to Congress a report that--
            ``(A) assesses the effectiveness of the procedures 
        under paragraph (1); and
            ``(B) if appropriate, includes proposed 
        legislation--
                    ``(i) to further protect the 
                confidentiality of tax information; and
                    ``(ii) to provide penalties for the 
                improper use by any person of the tax 
                information required to be provided under this 
                section.
    ``(h) If requested by the United States trustee or a 
trustee serving in the case, the debtor provide a document that 
establishes the identity of the debtor, including a driver's 
license, passport, or other document that contains a photograph 
of the debtor and such other personal identifying information 
relating to the debtor that establishes the identity of the 
debtor.''.

SEC. 604. DISMISSAL FOR FAILURE TO TIMELY FILE SCHEDULES OR PROVIDE 
                    REQUIRED INFORMATION.

    Section 521 of title 11, United States Code, is amended--
            (1) by inserting ``(a)'' before ``The debtor''; and
            (2) by adding at the end the following:
    ``(b)(1) Notwithstanding section 707(a) of this title, and 
subject to paragraph (2), if an individual debtor in a 
voluntary case under chapter 7 or 13 fails to file all of the 
information required under subsection (a)(1) within 45 days 
after the filing of the petition commencing the case, the case 
shall be automatically dismissed effective on the 46th day 
after the filing of the petition.
    ``(2) With respect to a case described in paragraph (1), 
any party in interest may request the court to enter an order 
dismissing the case. The court shall, if so requested, enter an 
order of dismissal not later than 5 days after such request.
    ``(3) Upon request of the debtor made within 45 days after 
the filing of the petition commencing a case described in 
paragraph (1), the court may allow the debtor an additional 
period of not to exceed 45 days to file the information 
required under subsection (a)(1) if the court finds 
justification for extending the period for the filing.''.

SEC. 605. ADEQUATE TIME TO PREPARE FOR HEARING ON CONFIRMATION OF THE 
                    PLAN.

    (a) Hearing.--Section 1324 of title 11, United States Code, 
is amended--
            (1) by striking ``After'' and inserting the 
        following:
    ``(a) Except as provided in subsection (b) and after''; and
            (2) by adding at the end the following:
    ``(b) The hearing on confirmation of the plan may be held 
not earlier than 20 days, and not later than 45 days, after the 
meeting of creditors under section 341(a) of this title.''.
    (b) Filing of Plan.--Section 1321 of title 11, United 
States Code, is amended to read as follows:

``Sec. 1321. Filing of plan

    ``The debtor shall file a plan not later than 90 days after 
the order for relief under this chapter, except that the court 
may extend such period if the need for an extension is 
attributable to circumstances for which the debtor should not 
justly be held accountable.''.

SEC. 606. CHAPTER 13 PLANS TO HAVE A 5-YEAR DURATION IN CERTAIN CASES.

    Title 11, United States Code, is amended--
            (1) by amending section 1322(d) to read as follows:
    ``(d) If the current monthly total income of the debtor and 
in a joint case, the debtor and the debtor's spouse combined, 
is not less than the highest national median family income 
reported for a family of equal or lesser size or, in the case 
of a household of 1 person, not less than the national median 
household income for 1 earner, the plan may not provide for 
payments over a period that is longer than 5 years. If the 
current monthly total income of the debtor or in a joint case, 
the debtor and the debtor's spouse combined, is less than the 
highest national median family income reported for a family of 
equal or lesser size, or in the case of a household of 1 person 
less than the national median household income for 1 earner, 
the plan may not provide for payments over a period that is 
longer than 3 years, unless the court, for cause, approves a 
longer period, but the court may not approve a period that is 
longer than 5 years.''; and
            (2) in section 1329--
                    (A) by striking in subsection (c) ``three 
                years'' and inserting ``the applicable 
                commitment period under section 
                1325(b)(1)(B)(ii)''; and
                    (B) by inserting at the end of subsection 
                (c) the following:

``The duration period shall be 5 years if the current monthly 
total income of the debtor, and in a joint case, the debtor and 
the debtor's spouse combined, is not less than the highest 
national median family income reported for a family of equal or 
lesser size or, in the case of a household of 1 person, not 
less than the national median household income for 1 earner, as 
of the date of the modification and shall be 3 years if the 
current monthly total income is less than the highest national 
median family income reported for a family of equal or lesser 
size or, in the case of a household of 1 person, less than the 
national median household income for 1 earner as of the date of 
the modification.''.

SEC. 607. SENSE OF THE CONGRESS REGARDING EXPANSION OF RULE 9011 OF THE 
                    FEDERAL RULES OF BANKRUPTCY PROCEDURE.

    It is the sense of the Congress that rule 9011 of the 
Federal Rules of Bankruptcy Procedure (11 U.S.C. App) should be 
modified to include a requirement that all documents (including 
schedules), signed and unsigned, submitted to the court or to a 
trustee by debtors who represent themselves and debtors who are 
represented by an attorney be submitted only after the debtor 
or the debtor's attorney has made reasonable inquiry to verify 
that the information contained in such documents is well 
grounded in fact, and is warranted by existing law or a good-
faith argument for the extension, modification, or reversal of 
existing law.

SEC. 608. ELIMINATION OF CERTAIN FEES PAYABLE IN CHAPTER 11 BANKRUPTCY 
                    CASES.

    (a) Amendments.--Section 1930(a)(6) of title 28, United 
States Code, is amended--
            (1) in the 1st sentence by striking ``until the 
        case is converted or dismissed, whichever occurs 
        first''; and
            (2) in the 2d sentence--
                    (A) by striking ``The'' and inserting 
                ``Until the plan is confirmed or the case is 
                converted (whichever occurs first) the''; and
                    (B) by striking ``less than $300,000;'' and 
                inserting ``less than $300,000. Until the case 
                is converted, dismissed, or closed (whichever 
                occurs first and without regard to confirmation 
                of the plan) the fee shall be''.
    (b) Delayed Effective Date.--The amendments made by 
subsection (a) shall take effect on October 1, 1999.

SEC. 609. STUDY OF BANKRUPTCY IMPACT OF CREDIT EXTENDED TO DEPENDENT 
                    STUDENTS.

    Not later than 1 year after the date of the enactment of 
this Act, the Comptroller General of the United States shall--
            (1) conduct a study regarding the impact that the 
        extension of credit to individuals who are--
                    (A) claimed as dependents for purposes of 
                the Internal Revenue Code of 1986; and
                    (B) enrolled in post-secondary educational 
                institutions,

        has on the rate of cases filed under title 11 of the 
        United States Code; and
            (2) submit to the Speaker of the House of 
        Representatives and the President pro tempore of the 
        Senate a report summarizing such study.

SEC. 610. PROMPT RELIEF FROM STAY IN INDIVIDUAL CASES.

    Section 362(e) of title 11, United States Code, is 
amended--
            (1) by inserting ``(1)'' after ``(e)''; and
            (2) by adding at the end the following:
    ``(2) Notwithstanding paragraph (1), in the case of an 
individual filing under chapter 7, 11, or 13, the stay under 
subsection (a) shall terminate on the date that is 60 days 
after a request is made by a party in interest under subsection 
(d), unless--
            ``(A) a final decision is rendered by the court 
        during the 60-day period beginning on the date of the 
        request; or
            ``(B) that 60-day period is extended--
                    ``(i) by agreement of all parties in 
                interest; or
                    ``(ii) by the court for such specific 
                period of time as the court finds is required 
                by for good cause as described in findings made 
                by the court.''.

SEC. 611. STOPPING ABUSIVE CONVERSIONS FROM CHAPTER 13.

    Section 348(f)(1) of title 11, United States Code, is 
amended--
            (1) in subparagraph (A), by striking ``and'' at the 
        end;
            (2) in subparagraph (B)--
                    (A) by striking ``in the converted case, 
                with allowed secured claims'' and inserting 
                ``only in a case converted to chapter 11 or 12 
                but not in a case converted to chapter 7, with 
                allowed secured claims in cases under chapters 
                11 and 12''; and
                    (B) by striking the period and inserting 
                ``; and''; and
            (3) by adding at the end the following:
            ``(C) with respect to cases converted from chapter 
        13--
                    ``(i) the claim of any creditor holding 
                security as of the date of the petition shall 
                continue to be secured by that security unless 
                the full amount of such claim determined under 
                applicable nonbankruptcy law has been paid in 
                full as of the date of conversion, 
                notwithstanding any valuation or determination 
                of the amount of an allowed secured claim made 
                for the purposes of the chapter 13 proceeding; 
                and
                    ``(ii) unless a prebankruptcy default has 
                been fully cured pursuant to the plan at the 
                time of conversion, in any proceeding under 
                this title or otherwise, the default shall have 
                the effect given under applicable nonbankruptcy 
                law.''.

                       TITLE VII--BANKRUPTCY DATA

SEC. 701. IMPROVED BANKRUPTCY STATISTICS.

    (a) Amendment.--Chapter 6 of part I of title 28, United 
States Code, is amended by adding at the end the following:

``Sec. 159. Bankruptcy statistics

    ``(a) The clerk of each district shall compile statistics 
regarding individual debtors with primarily consumer debts 
seeking relief under chapters 7, 11, and 13 of title 11. Those 
statistics shall be in a form prescribed by the Director of the 
Administrative Office of the United States Courts (referred to 
in this section as the `Office').
    ``(b) The Director shall--
            ``(1) compile the statistics referred to in 
        subsection (a);
            ``(2) make the statistics available to the public; 
        and
            ``(3) not later than October 31, 1998, and annually 
        thereafter, prepare, and submit to Congress a report 
        concerning the information collected under subsection 
        (a) that contains an analysis of the information.
    ``(c) The compilation required under subsection (b) shall--
            ``(1) be itemized, by chapter, with respect to 
        title 11;
            ``(2) be presented in the aggregate and for each 
        district; and
            ``(3) include information concerning--
                    ``(A) the total assets and total 
                liabilities of the debtors described in 
                subsection (a), and in each category of assets 
                and liabilities, as reported in the schedules 
                prescribed pursuant to section 2075 of this 
                title and filed by those debtors;
                    ``(B) the current total monthly income, 
                projected monthly net income, and average 
                income and average expenses of those debtors as 
                reported on the schedules and statements that 
                each such debtor files under sections 111, 521, 
                and 1322 of title 11;
                    ``(C) the aggregate amount of debt 
                discharged in the reporting period, determined 
                as the difference between the total amount of 
                debt and obligations of a debtor reported on 
                the schedules and the amount of such debt 
                reported in categories which are predominantly 
                nondischargeable;
                    ``(D) the average period of time between 
                the filing of the petition and the closing of 
                the case;
                    ``(E) for the reporting period--
                            ``(i) the number of cases in which 
                        a reaffirmation was filed; and
                            ``(ii)(I) the total number of 
                        reaffirmations filed;
                            ``(II) of those cases in which a 
                        reaffirmation was filed, the number in 
                        which the debtor was not represented by 
                        an attorney; and
                            ``(III) of those cases, the number 
                        of cases in which the reaffirmation was 
                        approved by the court;
                    ``(F) with respect to cases filed under 
                chapter 13 of title 11, for the reporting 
                period--
                            ``(i)(I) the number of cases in 
                        which a final order was entered 
                        determining the value of property 
                        securing a claim in an amount less than 
                        the amount of the claim; and
                            ``(II) the number of final orders 
                        determining the value of property 
                        securing a claim issued;
                            ``(ii) the number of cases 
                        dismissed for failure to make payments 
                        under the plan; and
                            ``(iii) the number of cases in 
                        which the debtor filed another case 
                        within the 6 years previous to the 
                        filing;
                    ``(G) the number of cases in which 
                creditors were fined for misconduct and any 
                amount of punitive damages awarded by the court 
                for creditor misconduct; and
                    ``(H) the number of cases in which 
                sanctions under rule 9011 of the Federal Rules 
                of Bankruptcy Procedure were imposed against 
                debtor's counsel and damages awarded under such 
                Rule.''.
    (b) Clerical Amendment.--The table of sections at the 
beginning of chapter 6 of title 28, United States Code, is 
amended by adding at the end the following:

``159. Bankruptcy statistics.''.

    (c) Effective Date.--The amendments made by this section 
shall take effect 18 months after the date of enactment of this 
Act.

SEC. 702. UNIFORM RULES FOR THE COLLECTION OF BANKRUPTCY DATA.

    (a) Amendment.--Title 28 of the United States Code is 
amended by inserting after section 589a the following:

``Sec. 589b. Bankruptcy data

    ``(a) Rules.--The Attorney General shall, within a 
reasonable time after the effective date of this section, issue 
rules requiring uniform forms for (and from time to time 
thereafter to appropriately modify and approve)--
            ``(1) final reports by trustees in cases under 
        chapters 7, 12, and 13 of title 11; and
            ``(2) periodic reports by debtors in possession or 
        trustees, as the case may be, in cases under chapter 11 
        of title 11.
    ``(b) Reports.--All reports referred to in subsection (a) 
shall be designed (and the requirements as to place and manner 
of filing shall be established) so as to facilitate compilation 
of data and maximum possible access of the public, both by 
physical inspection at 1 or more central filing locations, and 
by electronic access through the Internet or other appropriate 
media.
    ``(c) Required Information.--The information required to be 
filed in the reports referred to in subsection (b) shall be 
that which is in the best interests of debtors and creditors, 
and in the public interest in reasonable and adequate 
information to evaluate the efficiency and practicality of the 
Federal bankruptcy system. In issuing rules proposing the forms 
referred to in subsection (a), the Attorney General shall 
strike the best achievable practical balance between--
            ``(1) the reasonable needs of the public for 
        information about the operational results of the 
        Federal bankruptcy system; and
            ``(2) economy, simplicity, and lack of undue burden 
        on persons with a duty to file reports.
    ``(d) Final Reports.--Final reports proposed for adoption 
by trustees under chapters 7, 12, and 13 of title 11 shall, in 
addition to such other matters as are required by law or as the 
Attorney General in the discretion of the Attorney General, 
shall propose, include with respect to a case under such 
title--
            ``(1) information about the length of time the case 
        was pending;
            ``(2) assets abandoned;
            ``(3) assets exempted;
            ``(4) receipts and disbursements of the estate;
            ``(5) expenses of administration;
            ``(6) claims asserted;
            ``(7) claims allowed; and
            ``(8) distributions to claimants and claims 
        discharged without payment,

in each case by appropriate category and, in cases under 
chapters 12 and 13 of title 11, date of confirmation of the 
plan, each modification thereto, and defaults by the debtor in 
performance under the plan.
    ``(e) Periodic Reports.--Periodic reports proposed for 
adoption by trustees or debtors in possession under chapter 11 
of title 11 shall, in addition to such other matters as are 
required by law or as the Attorney General, in the discretion 
of the Attorney General, shall propose, include--
            ``(1) information about the standard industry 
        classification, published by the Department of 
        Commerce, for the businesses conducted by the debtor;
            ``(2) length of time the case has been pending;
            ``(3) number of full-time employees as at the date 
        of the order for relief and at end of each reporting 
        period since the case was filed;
            ``(4) cash receipts, cash disbursements and 
        profitability of the debtor for the most recent period 
        and cumulatively since the date of the order for 
        relief;
            ``(5) compliance with title 11, whether or not tax 
        returns and tax payments since the date of the order 
        for relief have been timely filed and made;
            ``(6) all professional fees approved by the court 
        in the case for the most recent period and cumulatively 
        since the date of the order for relief (separately 
        reported, in for the professional fees incurred by or 
        on behalf of the debtor, between those that would have 
        been incurred absent a bankruptcy case and those not); 
        and
            ``(7) plans of reorganization filed and confirmed 
        and, with respect thereto, by class, the recoveries of 
        the holders, expressed in aggregate dollar values and, 
        in the case of claims, as a percentage of total claims 
        of the class allowed.''.
    (b) Technical Amendment.--The table of sections of chapter 
39 of title 28, United States Code, is amended by adding at the 
end the following:

``589b. Bankruptcy data.''.

SEC. 703. SENSE OF THE CONGRESS REGARDING AVAILABILITY OF BANKRUPTCY 
                    DATA.

    It is the sense of the Congress that--
            (1) the national policy of the United States should 
        be that all data held by bankruptcy clerks in 
        electronic form, to the extent such data reflects only 
        public records (as defined in section 107 of title 11 
        of the United States Code), should be released in a 
        usable electronic form in bulk to the public subject to 
        such appropriate privacy concerns and safeguards as the 
        Judicial Conference of the United States may determine; 
        and
            (2) there should be established a bankruptcy data 
        system in which--
                    (A) a single set of data definitions and 
                forms are used to collect data nationwide; and
                    (B) data for any particular bankruptcy case 
                are aggregated in the same electronic record.

                 TITLE VIII--BANKRUPTCY TAX PROVISIONS

SEC. 801. TREATMENT OF CERTAIN LIENS.

    (a) Treatment of Certain Liens.--Section 724 of title 11, 
United States Code, is amended--
            (1) in subsection (b), in the matter preceding 
        paragraph (1), by inserting ``(other than to the extent 
        that there is a properly perfected unavoidable tax lien 
        arising in connection with an ad valorem tax on real or 
        personal property of the estate)'' after ``under this 
        title'';
            (2) in subsection (b)(2), after ``507(a)(1)'', 
        insert ``(except that such expenses, other than claims 
        for wages, salaries, or commissions which arise after 
        the filing of a petition, shall be limited to expenses 
        incurred under chapter 7 of this title and shall not 
        include expenses incurred under chapter 11 of this 
        title)''; and
            (3) by adding at the end the following:
    ``(e) Before subordinating a tax lien on real or personal 
property of the estate, the trustee shall--
            ``(1) exhaust the unencumbered assets of the 
        estate; and
            ``(2) in a manner consistent with section 506(c) of 
        this title, recover from property securing an allowed 
        secured claim the reasonable, necessary costs and 
        expenses of preserving or disposing of that property.
    ``(f) Notwithstanding the exclusion of ad valorem tax liens 
set forth in this section and subject to the requirements of 
subsection (e)--
            ``(1) claims for wages, salaries, and commissions 
        that are entitled to priority under section 507(a)(3) 
        of this title; or
            ``(2) claims for contributions to an employee 
        benefit plan entitled to priority under section 
        507(a)(4) of this title,

may be paid from property of the estate which secures a tax 
lien, or the proceeds of such property.''.
    (b) Determination of Tax Liability.--Section 505(a)(2) of 
title 11, United States Code, is amended--
            (1) in subparagraph (A), by striking ``or'' at the 
        end;
            (2) in subparagraph (B), by striking the period at 
        the end and inserting ``; or''; and
            (3) by adding at the end the following:
            ``(C) the amount or legality of any amount arising 
        in connection with an ad valorem tax on real or 
        personal property of the estate, if the applicable 
        period for contesting or redetermining that amountunder 
any law (other than a bankruptcy law) has expired.''.

SEC. 802. EFFECTIVE NOTICE TO GOVERNMENT.

    (a) Effective Notice to Governmental Units.--Section 342 of 
title 11, United States Code, is amended by adding at the end 
the following:
    ``(d) If a debtor lists a governmental unit as a creditor 
in a list or schedule, any notice required to be given by the 
debtor under this title, any rule, any applicable law, or any 
order of the court, shall identify the department, agency, or 
instrumentality through which the debtor is indebted. The 
debtor shall identify (with information such as a taxpayer 
identification number, loan, account or contract number, or 
real estate parcel number, where applicable), and describe the 
underlying basis for the governmental unit's claim. If the 
debtor's liability to a governmental unit arises from a debt or 
obligation owed or incurred by another individual, entity, or 
organization, or under a different name, the debtor shall 
identify such individual, entity, organization, or name.
    ``(e) The clerk shall keep and update quarterly, in the 
form and manner as the Director of the Administrative Office of 
the United States Courts prescribes, and make available to 
debtors, a register in which a governmental unit may designate 
a safe harbor mailing address for service of notice in cases 
pending in the district. A governmental unit may file a 
statement with the clerk designating a safe harbor address to 
which notices are to be sent, unless such governmental unit 
files a notice of change of address.''.
    (b) Adoption of Rules Providing Notice.--The Advisory 
Committee on Bankruptcy Rules of the Judicial Conference shall, 
within a reasonable period of time after the date of the 
enactment of this Act, propose for adoption enhanced rules for 
providing notice to State, Federal, and local government units 
that have regulatory authority over the debtor or which may be 
creditors in the debtor's case. Such rules shall be reasonably 
calculated to ensure that notice will reach the representatives 
of the governmental unit, or subdivision thereof, who will be 
the proper persons authorized to act upon the notice. At a 
minimum, the rules should require that the debtor--
            (1) identify in the schedules and the notice, the 
        subdivision, agency, or entity in respect of which such 
        notice should be received;
            (2) provide sufficient information (such as case 
        captions, permit numbers, taxpayer identification 
        numbers, or similar identifying information) to permit 
        the governmental unit or subdivision thereof, entitled 
        to receive such notice, to identify the debtor or the 
        person or entity on behalf of which the debtor is 
        providing notice where the debtor may be a successor in 
        interest or may not be the same as the person or entity 
        which incurred the debt or obligation; and
            (3) identify, in appropriate schedules, served 
        together with the notice, the property in respect of 
        which the claim or regulatory obligation may have 
        arisen, if any, the nature of such claim or regulatory 
        obligation and the purpose for which notice is being 
        given.
    (c) Effect of Failure of Notice.--Section 342 of title 11, 
United States Code, as amended by subsection (a), is amended by 
adding at the end the following:
    ``(f) A notice that does not comply with subsections (d) 
and (e) shall not be effective unless the debtor demonstrates, 
by clear and convincing evidence, that timely notice was given 
in a manner reasonably calculated to satisfy the requirements 
of this section was given, and that--
            ``(1) either the notice was timely sent to the safe 
        harbor address provided in the register maintained by 
        the clerk of the district in which the case was pending 
        for such purposes; or
            ``(2) no safe harbor address was provided in such 
        list for the governmental unit and that an officer of 
        the governmental unit who is responsible for the matter 
        or claim had actual knowledge of the case in sufficient 
        time to act.''.

SEC. 803. NOTICE OF REQUEST FOR A DETERMINATION OF TAXES.

    Section 505(b) of title 11, United States Code, is amended 
by striking ``Unless'' at the beginning of the second sentence 
thereof and inserting ``If the request is made substantially in 
the manner designated by the governmental unit and unless''.

SEC. 804. RATE OF INTEREST ON TAX CLAIMS.

    Chapter 5 of title 11, United States Code, is amended by 
adding at the end the following:

``Sec. 511. Rate of interest on tax claims

    ``If any provision of this title requires the payment of 
interest on a tax claim or requires the payment of interest to 
enable a creditor to receive the present value of the allowed 
amount of a tax claim, the rate of interest shall be as 
follows:
            ``(1) In the case of ad valorem tax claims, whether 
        secured or unsecured, other unsecured tax claims where 
        interest is required to be paid under section 726(a)(5) 
        of this title, secured tax claims, and administrative 
        tax claims paid under section 503(b)(1) of this title, 
        the rate shall be determined under applicable 
        nonbankruptcy law.
            ``(2) In the case of all other tax claims, the 
        minimum rate of interest shall be the Federal short-
        term rate rounded to the nearest full percent, 
        determined under section 1274(d) of the Internal 
        Revenue Code of 1986, plus 3 percentage points
                    ``(A) In the case of claims for Federal 
                income taxes, such rate shall be subject to any 
                adjustment that may be required under section 
                6621(d) of the Internal Revenue Code of 1986.
                    ``(B) In the case of taxes paid under a 
                confirmed plan or reorganization, such rate 
                shall be determined as of the calendar month in 
                which the plan is confirmed.''.

SEC. 805. TOLLING OF PRIORITY OF TAX CLAIM TIME PERIODS.

    Section 507(a)(9)(A) of title 11, United States Code, as so 
redesignated, is amended--
            (1) in clause (i) by inserting after ``petition'' 
        and before the semicolon ``, plus any time, plus 6 
        months, during which the stay of proceedings was in 
        effect in a prior case under this title''; and
            (2) amend clause (ii) to read as follows:
                            ``(ii) assessed within 240 days 
                        before the date of the filing of the 
                        petition, exclusive of--
                                    ``(I) any time plus 30 days 
                                during which an offer in 
                                compromise with respect of such 
                                tax, was pending or in effect 
                                during such 240-day period;
                                    ``(II) any time plus 30 
                                days during which an 
                                installment agreement with 
                                respect of such tax was pending 
                                or in effect during such 240-
                                day period, up to 1 year; and
                                    ``(III) any time plus 6 
                                months during which a stay of 
                                proceedings against collections 
                                was in effect in a prior case 
                                under this title during such 
                                240-day period.''.

SEC. 806. PRIORITY PROPERTY TAXES INCURRED.

    Section 507(a)(8)(B) of title 11, United States Code, is 
amended by striking ``assessed'' and inserting ``incurred''.

SEC. 807. CHAPTER 13 DISCHARGE OF FRAUDULENT AND OTHER TAXES.

    Section 1328(a)(2) of title 11, United States Code, is 
amended by inserting ``(1),'' after ``paragraph''.

SEC. 808. CHAPTER 11 DISCHARGE OF FRAUDULENT TAXES.

    Section 1141(d) of title 11, United States Code, as amended 
by section 119A, is amended by adding at the end the following:
    ``(6) Notwithstanding the provisions of paragraph (1), the 
confirmation of a plan does not discharge a debtor which is a 
corporation from any debt for a tax or customs duty with 
respect to which the debtor made a fraudulent return or 
willfully attempted in any manner to evade or defeat such 
tax.''.

SEC. 809. STAY OF TAX PROCEEDINGS.

    (a) Section 362 Stay Limited to Prepetition Taxes.--Section 
362(a)(8) of title 11, United States Code, is amended by 
striking the period at the end and inserting ``, in respect of 
a tax liability for a taxable period ending before the order 
for relief.''.
    (b) Appeal of Tax Court Decisions Permitted.--Section 
362(b)(9) of title 11, United States Code, is amended--
            (1) in subparagraph (C) by striking ``or'' at the 
        end;
            (2) in subparagraph (D) by striking the period at 
        the end and inserting ``; or''; and
            (3) by adding at the end the following:
                    ``(E) the appeal of a decision by a court 
                or administrative tribunal which determines a 
                tax liability of the debtor without regard to 
                whether such determination was made prepetition 
                or postpetition.''.

SEC. 810. PERIODIC PAYMENT OF TAXES IN CHAPTER 11 CASES.

    Section 1129(a)(9) of title 11, United States Code, is 
amended--
            (1) in subparagraph (B) by striking ``and'' at the 
        end; and
            (2) in subparagraph (C)--
                    (A) by striking ``deferred cash payments, 
                over a period not exceeding six years after the 
                date of assessment of such claim,'' and 
                inserting ``regular installment payments in 
                cash, but in no case with a balloon provision, 
                and no more than three months apart, beginning 
                no later than the effective date of the plan 
                and ending on the earlier of five years after 
                the petition date or the last date payments are 
                to be made under the plan to unsecured 
                creditors,'';
                    (B) by striking the period at the end and 
                inserting ``; and''; and
            (3) by adding at the end the following:
                    ``(D) with respect to a secured claim which 
                would be described in section 507(a)(8) of this 
                title but for its secured status, the holder of 
                such claim will receive on account of such 
                claim cash payments of not less than is 
                required in subparagraph (C) and over a period 
                no greater than is required in such 
                subparagraph.''.

SEC. 811. AVOIDANCE OF STATUTORY TAX LIENS PROHIBITED.

    Section 545(2) of title 11, United States Code, is amended 
by striking the semicolon at the end and inserting ``, except 
where such purchaser is a purchaser described in section 6323 
of the Internal Revenue Code of 1986 or similar provision of 
State or local law;''.

SEC. 812. PAYMENT OF TAXES IN THE CONDUCT OF BUSINESS.

    (a) Payment of Taxes Required.--Section 960 of title 28, 
United States Code, is amended--
            (1) by inserting ``(a)'' before ``Any''; and
            (2) by adding at the end the following:
    ``(b) Such taxes shall be paid when due in the conduct of 
such business unless--
            ``(1) the tax is a property tax secured by a lien 
        against property that is abandoned within a reasonable 
        time after the lien attaches, by the trustee of a 
        bankruptcy estate, pursuant to section 554 of title 11; 
        or
            ``(2) payment of the tax is excused under a 
        specific provision of title 11.
    ``(c) In a case pending under chapter 7 of title 11, 
payment of a tax may be deferred until final distribution is 
made under section 726 of title 11 if--
            ``(1) the tax was not incurred by a trustee duly 
        appointed under chapter 7 of title 11; or
            ``(2) before the due date of the tax, the court has 
        made a finding of probable insufficiency of funds of 
        the estate to pay in full the administrative expenses 
        allowed under section 503(b) of title 11 that have the 
        same priority in distribution under section 726(b) of 
        title 11 as such tax.''.
    (b) Payment of Ad Valorem Taxes Required.--Section 
503(b)(1)(B) of title 11, United States Code, is amended in 
clause (i) by inserting after ``estate,'' and before ``except'' 
the following: ``whether secured or unsecured, including 
property taxes for which liability is in rem only, in personam 
or both,''.
    (c) Request for Payment of Administrative Expense Taxes 
Eliminated.--Section 503(b)(1) of title 11, United States Code, 
is amended by adding at the end the following:
            ``(D) notwithstanding the requirements of 
        subsection (a) of this section, a governmental unit 
        shall not be required to file a request for the payment 
        of a claim described in subparagraph (B) or (C);''.
    (d) Payment of Taxes and Fees as Secured Claims.--Section 
506 of title 11, United States Code, is amended--
            (1) in subsection (b) by inserting ``or State 
        statute'' after ``agreement''; and
            (2) in subsection (c) by inserting ``, including 
        the payment of all ad valorem property taxes in respect 
        of the property'' before the period at the end.

SEC. 813. TARDILY FILED PRIORITY TAX CLAIMS.

    Section 726(a)(1) of title 11, United States Code, is 
amended by striking ``before the date on which the trustee 
commences distribution under this section'' and inserting ``on 
or before the earlier of 10 days after the mailing to creditors 
of the summary of the trustee's final report or the date on 
which the trustee commences final distribution under this 
section''.

SEC. 814. INCOME TAX RETURNS PREPARED BY TAX AUTHORITIES.

    Section 523(a)(1)(B) of title 11, United States Code, is 
amended--
            (1) by inserting ``or equivalent report or 
        notice,'' after ``a return,'';
            (2) in clause (i)--
                    (A) by inserting ``or given'' after 
                ``filed''; and
                    (B) by striking ``or'' at the end;
            (3) in clause (ii)--
                    (A) by inserting ``or given'' after 
                ``filed''; and
                    (B) by inserting ``, report, or notice'' 
                after ``return''; and
            (4) by adding at the end the following:
                            ``(iii) for purposes of this 
                        subsection, a return--
                                    ``(I) must satisfy the 
                                requirements of applicable 
                                nonbankruptcy law, and includes 
                                a return prepared pursuant to 
                                section 6020(a) of the Internal 
                                Revenue Code of 1986, or 
                                similar State or local law, or 
                                a written stipulation to a 
                                judgment entered by a 
                                nonbankruptcy tribunal, but 
                                does not include a return made 
                                pursuant to section 6020(b) of 
                                the Internal Revenue Code of 
                                1986, or similar State or local 
                                law; and
                                    ``(II) must have been filed 
                                in a manner permitted by 
                                applicable nonbankruptcy law; 
                                or''.

SEC. 815. DISCHARGE OF THE ESTATE'S LIABILITY FOR UNPAID TAXES.

    Section 505(b) of title 11, United States Code, is amended 
in the second sentence by inserting ``the estate,'' after 
``misrepresentation,''.

SEC. 816. REQUIREMENT TO FILE TAX RETURNS TO CONFIRM CHAPTER 13 PLANS.

    (a) Filing of Prepetition Tax Returns Required for Plan 
Confirmation.--Section 1325(a) of title 11, United States Code, 
as amended by section 143, is amended--
            (1) in paragraph (6) by striking ``and'' at the 
        end;
            (2) in paragraph (7) by striking the period at the 
        end and inserting ``; and''; and
            (3) by adding at the end the following:
            ``(8) if the debtor has filed all Federal, State, 
        and local tax returns as required by section 1308 of 
        this title.''.
    (b) Additional Time Permitted for Filing Tax Returns.--(1) 
Chapter 13 of title 11, United States Code, as amended by 
section 137, is amended by adding at the end the following:

``Sec. 1308. Filing of prepetition tax returns

    ``(a) On or before the day prior to the day on which the 
first meeting of the creditors is convened under section 341(a) 
of this title, the debtor shall have filed with appropriate tax 
authorities all tax returns for all taxable periods ending in 
the 3-year period ending on the date of filing of the petition.
    ``(b) If the tax returns required by subsection (a) have 
not been filed by the date on which the first meeting of 
creditors is convened under section 341(a) of this title, the 
trustee may continue such meeting for a reasonable period of 
time, to allow the debtor additional time to file any unfiled 
returns, but such additional time shall be no more than--
            ``(1) for returns that are past due as of the date 
        of the filing of the petition, 120 days from such date;
            ``(2) for returns which are not past due as of the 
        date of the filing of the petition, the later of 120 
        days from such date or the due date for such returns 
        under the last automatic extension of time for filing 
        such returns to which the debtor is entitled,and for 
which request has been timely made, according to applicable 
nonbankruptcy law; and
            ``(3) upon notice and hearing, and order entered 
        before the lapse of any deadline fixed according to 
        this subsection, where the debtor demonstrates, by 
        clear and convincing evidence, that the failure to file 
        the returns as required is because of circumstances 
        beyond the control of the debtor, the court may extend 
        the deadlines set by the trustee as provided in this 
        subsection for--
                    ``(A) a period of no more than 30 days for 
                returns described in paragraph (1) of this 
                subsection; and
                    ``(B) for no more than the period of time 
                ending on the applicable extended due date for 
                the returns described in paragraph (2).
    ``(c) For purposes of this section only, a return includes 
a return prepared pursuant to section 6020 (a) or (b) of the 
Internal Revenue Code of 1986 or similar State or local law, or 
a written stipulation to a judgment entered by a nonbankruptcy 
tribunal.''.
    (2) The table of sections of chapter 13 of title 11, United 
States Code, is amended by inserting after the item relating to 
section 1307 the following:

``1308. Filing of prepetition tax returns.''.

    (c) Dismissal or Conversion on Failure To Comply.--Section 
1307 of title 11, United States Code, is amended--
            (1) by redesignating subsections (e) and (f) as 
        subsections (f) and (g), respectively; and
            (2) by inserting after subsection (d) the 
        following:
    ``(e) Upon the failure of the debtor to file tax returns 
under section 1308 of this title, on request of a party in 
interest or the United States trustee and after notice and a 
hearing, the court shall dismiss a case or convert a case under 
this chapter to a case under chapter 7 of this title, whichever 
is in the best interests of creditors and the estate.''.
    (d) Timely Filed Claims.--Section 502(b)(9) of title 11, 
United States Code, is amended by striking the period at the 
end and inserting ``, and except that in a case under chapter 
13 of this title, a claim of a governmental unit for a tax in 
respect of a return filed under section 1308 of this title 
shall be timely if it is filed on or before 60 days after such 
return or returns were filed as required.''.
    (e) Rules for Objections to Claims and to Confirmation.--It 
is the sense of the Congress that the Advisory Committee on 
Bankruptcy Rules of the Judicial Conference should, within a 
reasonable period of time after the date of the enactment of 
this Act, propose for adoption amended Federal Rules of 
Bankruptcy Procedure which provide that--
            (1) notwithstanding the provisions of Rule 3015(f), 
        in cases under chapter 13 of title 11, United States 
        Code, a governmental unit may object to the 
        confirmation of a plan on or before 60 days after the 
        debtor files all tax returns required under sections 
        1308 and 1325(a)(7) of title 11, United States Code; 
        and
            (2) in addition to the provisions of Rule 3007, in 
        a case under chapter 13 of title 11, United States 
        Code, no objection to a tax in respect of a return 
        required to be filed under such section 1308 shall be 
        filed until such return has been filed as required.

SEC. 817. STANDARDS FOR TAX DISCLOSURE.

    Section 1125(a) of title 11, United States Code, is amended 
in paragraph (1)--
            (1) by inserting after ``records,'' the following: 
        ``including a full discussion of the potential material 
        Federal, State, and local tax consequences of the plan 
        to the debtor, any successor to the debtor, and a 
        hypothetical investor domiciled in the State in which 
        the debtor resides or has its principal place of 
        business typical of the holders of claims or interests 
        in the case,'';
            (2) by inserting ``such'' after ``enable''; and
            (3) by striking ``reasonable'' where it appears 
        after ``hypothetical'' and by striking ``typical of 
        holders of claims or interests'' after ``investor''.

SEC. 818. SETOFF OF TAX REFUNDS.

    Section 362(b) of title 11, United States Code, as amended 
by sections 120, 134, 139, and 203, is amended--
            (1) in paragraph (29) by striking ``or'';
            (2) in paragraph (29) by striking the period at the 
        end and inserting ``; or''; and
            (3) by inserting after paragraph (29) the 
        following:
            ``(30) under subsection (a) of the setoff of an 
        income tax refund, by a governmental unit, in respect 
        of a taxable period which ended before the order for 
        relief against an income tax liability for a taxable 
        period which also ended before the order for relief, 
        unless--
                    ``(A) prior to such setoff, an action to 
                determine the amount or legality of such tax 
                liability under section 505(a) was commenced; 
                or
                    ``(B) where the setoff of an income tax 
                refund is not permitted because of a pending 
                action to determine the amount or legality of a 
                tax liability, the governmental unit may hold 
                the refund pending the resolution of the 
                action.''.

            TITLE IX--ANCILLARY AND OTHER CROSS-BORDER CASES

SEC. 901. AMENDMENT TO ADD CHAPTER 15 TO TITLE 11, UNITED STATES CODE.

    (a) In General.--Title 11, United States Code, is amended 
by inserting after chapter 13 the following:

          ``CHAPTER 15--ANCILLARY AND OTHER CROSS-BORDER CASES

  ``Sec.
``1501. Purpose and scope of application.

                   ``SUBCHAPTER I--GENERAL PROVISIONS

``1502. Definitions.
``1503. International obligations of the United States.
``1504. Commencement of ancillary case.
``1505. Authorization to act in a foreign country.
``1506. Public policy exception.
``1507. Additional assistance.
``1508. Interpretation.

``SUBCHAPTER II--ACCESS OF FOREIGN REPRESENTATIVES AND CREDITORS TO THE 
                                  COURT

``1509. Right of direct access.
``1510. Limited jurisdiction.
``1511. Commencement of case under section 301 or 303.
``1512. Participation of a foreign representative in a case under this 
          title.
``1513. Access of foreign creditors to a case under this title.
``1514. Notification to foreign creditors concerning a case under this 
          title.

    ``SUBCHAPTER III--RECOGNITION OF A FOREIGN PROCEEDING AND RELIEF

``1515. Application for recognition of a foreign proceeding.
``1516. Presumptions concerning recognition.
``1517. Order recognizing a foreign proceeding.
``1518. Subsequent information.
``1519. Relief that may be granted upon petition for recognition of a 
          foreign proceeding.
``1520. Effects of recognition of a foreign main proceeding.
``1521. Relief that may be granted upon recognition of a foreign 
          proceeding.
``1522. Protection of creditors and other interested persons.
``1523. Actions to avoid acts detrimental to creditors.
``1524. Intervention by a foreign representative.

      ``SUBCHAPTER IV--COOPERATION WITH FOREIGN COURTS AND FOREIGN 
                             REPRESENTATIVES

``1525. Cooperation and direct communication between the court and 
          foreign courts or foreign representatives.
``1526. Cooperation and direct communication between the trustee and 
          foreign courts or foreign representatives.
``1527. Forms of cooperation.

                 ``SUBCHAPTER V--CONCURRENT PROCEEDINGS

``1528. Commencement of a case under this title after recognition of a 
          foreign main proceeding.
``1529. Coordination of a case under this title and a foreign 
          proceeding.
``1530. Coordination of more than 1 foreign proceeding.
``1531. Presumption of insolvency based on recognition of a foreign main 
          proceeding.
``1532. Rule of payment in concurrent proceedings.

``Sec. 1501. Purpose and scope of application

    ``(a) The purpose of this of chapter is to incorporate the 
Model Law on Cross-Border Insolvency so as to provide effective 
mechanisms for dealing with cases of cross-border insolvency 
with the objectives of--
            ``(1) cooperation between--
                    ``(A) United States courts, United States 
                Trustees, trustees, examiners, debtors, and 
                debtors in possession; and
                    ``(B) the courts and other competent 
                authorities of foreign countries involved in 
                cross-border insolvency cases;
            ``(2) greater legal certainty for trade and 
        investment;
            ``(3) fair and efficient administration of cross-
        border insolvencies that protects the interests of all 
        creditors, and other interested entities, including the 
        debtor;
            ``(4) protection and maximization of the value of 
        the debtor's assets; and
            ``(5) facilitation of the rescue of financially 
        troubled businesses, thereby protecting investment and 
        preserving employment.
    ``(b) This chapter applies where--
            ``(1) assistance is sought in the United States by 
        a foreign court or a foreign representative in 
        connection with a foreign proceeding;
            ``(2) assistance is sought in a foreign country in 
        connection with a case under this title;
            ``(3) a foreign proceeding and a case under this 
        title with respect to the same debtor are taking place 
        concurrently; or
            ``(4) creditors or other interested persons in a 
        foreign country have an interest in requesting the 
        commencement of, or participating in, a case or 
        proceeding under this title.
    ``(c) This chapter does not apply to--
            ``(1) a proceeding concerning an entity identified 
        by exclusion in subsection 109(b);
            ``(2) an individual, or to an individual and such 
        individual's spouse, who have debts within the limits 
        specified in section 109(e) and who are citizens of the 
        United States or aliens lawfully admitted for permanent 
        residence in the United States; or
            ``(3) an entity subject to a proceeding under the 
        Securities Investor Protection Act, a stockbroker 
        subject to subchapter III of chapter 7 of this title, 
        or a commodity broker subject to subchapter IV of 
        chapter 7 of this title.

                   ``SUBCHAPTER I--GENERAL PROVISIONS

``Sec. 1502. Definitions

    ``For the purposes of this chapter, the term--
            ``(1) `debtor' means an entity that is the subject 
        of a foreign proceeding;
            ``(2) `establishment' means any place of operations 
        where the debtor carries out a nontransitory economic 
        activity;
            ``(3) `foreign court' means a judicial or other 
        authority competent to control or supervise a foreign 
        proceeding;
            ``(4) `foreign main proceeding' means a foreign 
        proceeding taking place in the country where the debtor 
        has the center of its main interests;
            ``(5) `foreign nonmain proceeding' means a foreign 
        proceeding, other than a foreign main proceeding, 
        taking place in a country where the debtor has an 
        establishment;
            ``(6) `trustee' includes a trustee, a debtor in 
        possession in a case under any chapter of this title, 
        or a debtor under chapter 9 of this title; and
            ``(7) `within the territorial jurisdiction of the 
        United States' when used with reference to property of 
        a debtor refers to tangible property located within the 
        territory of the United States and intangible property 
        deemed under applicable nonbankruptcy law to be located 
        within that territory, including any property subject 
        to attachment or garnishment that may properly be 
        seized or garnished by an action in a Federal or State 
        court in the United States.

``Sec. 1503. International obligations of the United States

    ``To the extent that this chapter conflicts with an 
obligation of the United States arising out of any treaty or 
other form of agreement to which it is a party with 1 or more 
other countries, the requirements of the treaty or agreement 
prevail.

``Sec. 1504. Commencement of ancillary case

    ``A case under this chapter is commenced by the filing of a 
petition for recognition of a foreign proceeding under section 
1515.

``Sec. 1505. Authorization to act in a foreign country

    ``A trustee or another entity, including an examiner, may 
be authorized by the court to act in a foreign country on 
behalf of an estate created under section 541. An entity 
authorized to act under this section may act in any way 
permitted by the applicable foreign law.

``Sec. 1506. Public policy exception

    ``Nothing in this chapter prevents the court from refusing 
to take an action governed by this chapter if the action would 
be manifestly contrary to the public policy of the United 
States.

``Sec. 1507. Additional assistance

    ``(a) Subject to the specific limitations stated elsewhere 
in this chapter the court, upon recognition of a foreign 
proceeding, to provide additional assistance to a foreign 
representative under this title or under other laws of the 
United States.
    ``(b) In determining whether to provide additional 
assistance under this title or under other laws of the United 
States, the court shall consider whether such additional 
assistance, consistent with the principles of comity, will 
reasonably assure--
            ``(1) just treatment of all holders of claims 
        against or interests in the debtor's property;
            ``(2) protection of claim holders in the United 
        States against prejudice and inconvenience in the 
        processing of claims in such foreign proceeding;
            ``(3) prevention of preferential or fraudulent 
        dispositions of property of the debtor;
            ``(4) distribution of proceeds of the debtor's 
        property substantially in accordance with the order 
        prescribed by this title; and
            ``(5) if appropriate, the provision of an 
        opportunity for a fresh start for the individual that 
        such foreign proceeding concerns.

``Sec. 1508. Interpretation

    ``In interpreting this chapter, the court shall consider 
its international origin, and the need to promote an 
application of this chapter that is consistent with the 
application of similar statutes adopted by foreign 
jurisdictions.

``SUBCHAPTER II--ACCESS OF FOREIGN REPRESENTATIVES AND CREDITORS TO THE 
                                 COURT

``Sec. 1509. Right of direct access

    ``(a) A foreign representative is entitled to commence a 
case under section 1504 by filing a petition for recognition 
under section 1515, and upon recognition, to apply directly to 
other Federal and State courts for appropriate relief in those 
courts.
    ``(b) Upon recognition, and subject to section 1510, a 
foreign representative has the capacity to sue and be sued, and 
shall be subject to the laws of the United States of general 
applicability.
    ``(c) Subject to section 1510 of this title, a foreign 
representative is subject to laws of general application.
    ``(d) Recognition under this chapter is prerequisite to the 
granting of comity or cooperation to a foreign representative 
in any State or Federal court in the United States. Any request 
for comity or cooperation by a foreign representative in any 
court shall be accompanied by a sworn statement setting forth 
whether recognition under section 1515 has been sought and the 
status of any such petition.
    ``(e) Upon denial of recognition under this chapter, the 
court may issue appropriate orders necessary to prevent an 
attempt to obtain comity or cooperation from courts in the 
United States without such recognition.

``Sec. 1510. Limited jurisdiction

    ``The sole fact that a foreign representative files a 
petition under section 1515 does not subject the foreign 
representative to the jurisdiction of any court in the United 
States for any other purpose.

``Sec. 1511. Commencement of case under section 301 or 303

    ``(a) Upon recognition, a foreign representative may 
commence--
            ``(1) an involuntary case under section 303; or
            ``(2) a voluntary case under section 301 or 302, if 
        the foreign proceeding is a foreign main proceeding.
    ``(b) The petition commencing a case under subsection (a) 
must be accompanied by a statement describing the petition for 
recognition and its current status. The court where the 
petition for recognition has been filed must be advised of the 
foreign representative's intent to commence a case under 
subsection (a) prior to such commencement.

``Sec. 1512. Participation of a foreign representative in a case under 
                    this title

    ``Upon recognition of a foreign proceeding, the foreign 
representative in that proceeding is entitled to participate as 
a party in interest in a case regarding the debtor under this 
title.

``Sec. 1513. Access of foreign creditors to a case under this title

    ``(a) Foreign creditors have the same rights regarding the 
commencement of, and participation in, a case under this title 
as domestic creditors.
    ``(b)(1) Subsection (a) does not change or codify present 
law as to the priority of claims under section 507 or 726 of 
this title, except that the claim of a foreign creditor under 
those sections shall not be given a lower priority than that of 
general unsecured claims without priority solely because the 
holder of such claim is a foreign creditor.
    ``(2)(A) Subsection (a) and paragraph (1) do not change or 
codify present law as to the allowability of foreign revenue 
claims or other foreign public law claims in a proceeding under 
this title.
    ``(B) Allowance and priority as to a foreign tax claim or 
other foreign public law claim shall be governed by any 
applicable tax treaty of the United States, under the 
conditions and circumstances specified therein.

``Sec. 1514. Notification to foreign creditors concerning a case under 
                    this title

    ``(a) Whenever in a case under this title notice is to be 
given to creditors generally or to any class or category of 
creditors, such notice shall also be given to the known 
creditors generally, or to creditors in the notified class or 
category, that do not have addresses in the United States. The 
court may order that appropriate steps be taken with a view to 
notifying any creditor whose address is not yet known.
    ``(b) Such notification to creditors with foreign addresses 
described in subsection (a) shall be given individually, unless 
the court considers that, under the circumstances, some other 
form of notification would be more appropriate. No letters 
rogatory or other similar formality is required.
    ``(c) When a notification of commencement of a case is to 
be given to foreign creditors, the notification shall--
            ``(1) indicate the time period for filing proofs of 
        claim and specify the place for their filing;
            ``(2) indicate whether secured creditors need to 
        file their proofs of claim; and
            ``(3) contain any other information required to be 
        included in such a notification to creditors pursuant 
        to this title and the orders of the court.
    ``(d) Any rule of procedure or order of the court as to 
notice or the filing of a claim shall provide such additional 
time to creditors with foreign addresses as is reasonable under 
the circumstances.

    ``SUBCHAPTER III--RECOGNITION OF A FOREIGN PROCEEDING AND RELIEF

``Sec. 1515. Application for recognition of a foreign proceeding

    ``(a) A foreign representative applies to the court for 
recognition of the foreign proceeding in which the foreign 
representative has been appointed by filing a petition for 
recognition.
    ``(b) A petition for recognition shall be accompanied by--
            ``(1) a certified copy of the decision commencing 
        the foreign proceeding and appointing the foreign 
        representative;
            ``(2) a certificate from the foreign court 
        affirming the existence of the foreign proceeding and 
        of the appointment of the foreign representative; or
            ``(3) in the absence of evidence referred to in 
        paragraphs (1) and (2), any other evidence acceptable 
        to the court of the existence of the foreign proceeding 
        and of the appointment of the foreign representative.
    ``(c) A petition for recognition shall also be accompanied 
by a statement identifying all foreign proceedings with respect 
to the debtor that are known to the foreign representative.
    ``(d) The documents referred to in paragraphs (1) and (2) 
of subsection (b) must be translated into English. The court 
may require a translation into English of additional documents.

``Sec. 1516. Presumptions concerning recognition

    ``(a) If the decision or certificate referred to in section 
1515(b) indicates that the foreign proceeding is a foreign 
proceeding as defined in section 101 and that the person or 
body is a foreign representative as defined in section 101, the 
court is entitled to so presume.
    ``(b) The court is entitled to presume that documents 
submitted in support of the petition for recognition are 
authentic, whether or not they have been legalized.
    ``(c) In the absence of evidence to the contrary, the 
debtor's registered office, or habitual residence in the case 
of an individual, is presumed to be the center of the debtor's 
main interests.

``Sec. 1517. Order recognizing a foreign proceeding

    ``(a) Subject to section 1506, after notice and a hearing 
an order recognizing a foreign proceeding shall be entered if--
            ``(1) the foreign proceeding is a foreign main 
        proceeding or foreign nonmain proceeding within the 
        meaning of section 1502;
            ``(2) the foreign representative applying for 
        recognition is a person or body as defined in section 
        101; and
            ``(3) the petition meets the requirements of 
        section 1515.
    ``(b) The foreign proceeding shall be recognized--
            ``(1) as a foreign main proceeding if it is taking 
        place in the country where the debtor has the center of 
        its main interests; or
            ``(2) as a foreign nonmain proceeding if the debtor 
        has an establishment within the meaning of section 1502 
        in the foreign country where the proceeding is pending.
    ``(c) A petition for recognition of a foreign proceeding 
shall be decided upon at the earliest possible time. Entry of 
an order recognizing a foreign proceeding shall constitute 
recognition under this chapter.
    ``(d) The provisions of this subchapter do not prevent 
modification or termination of recognition if it is shown that 
the grounds for granting it were fully or partially lacking or 
have ceased to exist, but in considering such action the court 
shall give due weight to possible prejudice to parties that 
have relied upon the granting of recognition. The case under 
this chapter may be closed in the manner prescribed for a case 
under section 350.

``Sec. 1518. Subsequent information

    ``From the time of filing the petition for recognition of 
the foreign proceeding, the foreign representative shall file 
with the court promptly a notice of change of status 
concerning--
            ``(1) any substantial change in the status of the 
        foreign proceeding or the status of the foreign 
        representative's appointment; and
            ``(2) any other foreign proceeding regarding the 
        debtor that becomes known to the foreign 
        representative.

``Sec. 1519. Relief that may be granted upon petition for recognition 
                    of a foreign proceeding

    ``(a) From the time of filing a petition for recognition 
until the petition is decided upon, the court may, at the 
request of the foreign representative, where relief is urgently 
needed to protect the assets of the debtor or the interests of 
the creditors, grant relief of a provisional nature, 
including--
            ``(1) staying execution against the debtor's 
        assets;
            ``(2) entrusting the administration or realization 
        of all or part of the debtor's assets located in the 
        United States to the foreign representative or another 
        person authorized by the court, including an examiner, 
        in order to protect and preserve the value of assets 
        that, by their nature or because of other 
        circumstances, are perishable, susceptible to 
        devaluation or otherwise in jeopardy; and
            ``(3) any relief referred to in paragraph (3), (4), 
        or (7) of section 1521(a).
    ``(b) Unless extended under section 1521(a)(6), the relief 
granted under this section terminates when the petition for 
recognition is decided upon.
    ``(c) It is a ground for denial of relief under this 
section that such relief would interfere with the 
administration of a foreign main proceeding.
    ``(d) The court may not enjoin a police or regulatory act 
of a governmental unit, including a criminal action or 
proceeding, under this section.
    ``(e) The standards, procedures, and limitations applicable 
to an injunction shall apply to relief under this section.

``Sec. 1520. Effects of recognition of a foreign main proceeding

    ``(a) Upon recognition of a foreign proceeding that is a 
foreign main proceeding--
            ``(1) section 362 applies with respect to the 
        debtor and that property of the debtor that is within 
        the territorial jurisdiction of the United States;
            ``(2) a transfer, an encumbrance, or any other 
        disposition of an interest of the debtor in property 
        within the territorial jurisdiction of the United 
        States is restrained as and to the extent that is 
        provided for property of an estate under sections 363, 
        549, and 552; and
            ``(3) unless the court orders otherwise, the 
        foreign representative may operate the debtor's 
        business and may exercise the powers of a trustee under 
        section 549, subject to sections 363 and 552.
    ``(b) The scope, and the modification or termination, of 
the stay and restraints referred to in subsection (a) are 
subject to the exceptions and limitations provided in 
subsections (b), (c), and (d) of section 362, subsections (b) 
and (c) of section 363, and sections 552, 555 through 557, 559, 
and 560.
    ``(c) Subsection (a) does not affect the right to commence 
individual actions or proceedings in a foreign country to the 
extent necessary to preserve a claim against the debtor.
    ``(d) Subsection (a) does not affect the right of a foreign 
representative or an entity to file a petition commencing a 
case under this title or the right of any party to file claims 
or take other proper actions in such a case.

``Sec. 1521. Relief that may be granted upon recognition of a foreign 
                    proceeding

    ``(a) Upon recognition of a foreign proceeding, whether 
main or nonmain, where necessary to effectuate the purpose of 
this chapter and to protect the assets of the debtor or the 
interests of the creditors, the court may, at the request of 
the foreign representative, grant any appropriate relief, 
including--
            ``(1) staying the commencement or continuation of 
        individual actions or individual proceedings concerning 
        the debtor's assets, rights, obligations or liabilities 
        to the extent they have not been stayed under section 
        1520(a);
            ``(2) staying execution against the debtor's assets 
        to the extent it has not been stayed under section 
        1520(a);
            ``(3) suspending the right to transfer, encumber or 
        otherwise dispose of any assets of the debtor to the 
        extent this right has not been suspended under section 
        1520(a);
            ``(4) providing for the examination of witnesses, 
        the taking of evidence or the delivery of information 
        concerning the debtor's assets, affairs, rights, 
        obligations or liabilities;
            ``(5) entrusting the administration or realization 
        of all or part of the debtor's assets within the 
        territorial jurisdiction of the United States to the 
        foreign representative or another person, including an 
        examiner, authorized by the court;
            ``(6) extending relief granted under section 
        1519(a); and
            ``(7) granting any additional relief that may be 
        available to a trustee, except for relief available 
        under sections 522, 544, 545, 547, 548, 550, and 
        724(a).
    ``(b) Upon recognition of a foreign proceeding, whether 
main or nonmain, the court may, at the request of the foreign 
representative, entrust the distribution of all or part of the 
debtor's assets located in the United States to the foreign 
representative or another person, including an examiner, 
authorized by the court, provided that the court is satisfied 
that the interests of creditors in the United States are 
sufficiently protected.
    ``(c) In granting relief under this section to a 
representative of a foreign nonmain proceeding, the court must 
be satisfied that the relief relates to assets that, under the 
law of the United States, should be administered in the foreign 
nonmain proceeding or concerns information required in that 
proceeding.
    ``(d) The court may not enjoin a police or regulatory act 
of a governmental unit, including a criminal action or 
proceeding, under this section.
    ``(e) The standards, procedures, and limitations applicable 
to an injunction shall apply to relief under paragraphs (1), 
(2), (3), and (6) of subsection (a).

``Sec. 1522. Protection of creditors and other interested persons

    ``(a) The court may grant relief under section 1519 or 
1521, or may modify or terminate relief under subsection (c), 
only if the interests of the creditors and other interested 
entities, including the debtor, are sufficiently protected.
    ``(b) The court may subject relief granted under section 
1519 or 1521, or the operation of the debtor's business under 
section 1520(a)(2) of this title, to conditions it considers 
appropriate, including the giving of security or the filing of 
a bond.
    ``(c) The court may, at the request of the foreign 
representative or an entity affected by relief granted under 
section 1519 or 1521, or at its own motion, modify or terminate 
such relief.
    ``(d) Section 1104(d) shall apply to the appointment of an 
examiner under this chapter. Any examiner shall comply with the 
qualification requirements imposed on a trustee by section 322.

``Sec. 1523. Actions to avoid acts detrimental to creditors

    ``(a) Upon recognition of a foreign proceeding, the foreign 
representative has standing in a case concerning the debtor 
pending under another chapter of this title to initiate actions 
under sections 522, 544, 545, 547, 548, 550, and 724(a).
    ``(b) When the foreign proceeding is a foreign nonmain 
proceeding, the court must be satisfied that an action under 
subsection (a) relates to assets that, under United States law, 
should be administered in the foreign nonmain proceeding.

``Sec. 1524. Intervention by a foreign representative

    ``Upon recognition of a foreign proceeding, the foreign 
representative may intervene in any proceedings in a State or 
Federal court in the United States in which the debtor is a 
party.

     ``SUBCHAPTER IV--COOPERATION WITH FOREIGN COURTS AND FOREIGN 
                            REPRESENTATIVES

``Sec. 1525. Cooperation and direct communication between the court and 
                    foreign courts or foreign representatives

    ``(a) Consistent with section 1501, the court shall 
cooperate to the maximum extent possible with foreign courts or 
foreign representatives, either directly or through the 
trustee.
    ``(b) The court is entitled to communicate directly with, 
or to request information or assistance directly from, foreign 
courts or foreign representatives, subject to the rights of 
parties in interest to notice and participation.

``Sec. 1526. Cooperation and direct communication between the trustee 
                    and foreign courts or foreign representatives

    ``(a) Consistent with section 1501, the trustee or other 
person, including an examiner, authorized by the court, shall, 
subject to the supervision of the court, cooperate to the 
maximum extent possible with foreign courts or foreign 
representatives.
    ``(b) The trustee or other person, including an examiner, 
authorized by the court is entitled, subject to the supervision 
of the court, to communicate directly with foreign courts or 
foreign representatives.

``Sec. 1527. Forms of cooperation

    ``Cooperation referred to in sections 1525 and 1526 may be 
implemented by any appropriate means, including--
            ``(1) appointment of a person or body, including an 
        examiner, to act at the direction of the court;
            ``(2) communication of information by any means 
        considered appropriate by the court;
            ``(3) coordination of the administration and 
        supervision of the debtor's assets and affairs;
            ``(4) approval or implementation of agreements 
        concerning the coordination of proceedings; and
            ``(5) coordination of concurrent proceedings 
        regarding the same debtor.

                 ``SUBCHAPTER V--CONCURRENT PROCEEDINGS

``Sec. 1528. Commencement of a case under this title after recognition 
                    of a foreign main proceeding

    ``After recognition of a foreign main proceeding, a case 
under another chapter of this title may be commenced only if 
the debtor has assets in the United States. The effects of such 
case shall be restricted to the assets of the debtor that are 
within the territorial jurisdiction of the United States and, 
to the extent necessary to implement cooperation and 
coordination under sections 1525, 1526, and 1527, to other 
assets of the debtor that are within the jurisdiction of the 
court under sections 541(a) of this title, and 1334(e) of title 
28, to the extent that such other assets are not subject to the 
jurisdiction and control of a foreign proceeding that has been 
recognized under this chapter.

``Sec. 1529. Coordination of a case under this title and a foreign 
                    proceeding

    ``Where a foreign proceeding and a case under another 
chapter of this title are taking place concurrently regarding 
the same debtor, the court shall seek cooperation and 
coordination under sections 1525, 1526, and 1527, and the 
following shall apply:
            ``(1) When the case in the United States is taking 
        place at the time the petition for recognition of the 
        foreign proceeding is filed--
                    ``(A) any relief granted under sections 
                1519 or 1521 must be consistent with the relief 
                granted in the case in the United States; and
                    ``(B) even if the foreign proceeding is 
                recognized as a foreign main proceeding, 
                section 1520 does not apply.
            ``(2) When a case in the United States under this 
        title commences after recognition, or after the filing 
        of the petition for recognition, of the foreign 
        proceeding--
                    ``(A) any relief in effect under sections 
                1519 or 1521 shall be reviewed by the court and 
                shall be modified or terminated if inconsistent 
                with the case in the United States; and
                    ``(B) if the foreign proceeding is a 
                foreign main proceeding, the stay and 
                suspension referred to in section 1520(a) shall 
                be modified or terminated if inconsistent with 
                the relief granted in the case in the United 
                States.
            ``(3) In granting, extending, or modifying relief 
        granted to a representative of a foreign nonmain 
        proceeding, the court must be satisfied that the relief 
        relates to assets that, under the law of the United 
        States, should be administered in the foreign nonmain 
        proceeding or concerns information required in that 
        proceeding.
            ``(4) In achieving cooperation and coordination 
        under sections 1528 and 1529, the court may grant any 
        of the relief authorized under section 305.

``Sec. 1530. Coordination of more than 1 foreign proceeding

    ``In matters referred to in section 1501, with respect to 
more than 1 foreign proceeding regarding the debtor, the court 
shall seek cooperation and coordination under sections 1525, 
1526, and 1527, and the following shall apply:
            ``(1) Any relief granted under section 1519 or 1521 
        to a representative of a foreign nonmain proceeding 
        after recognition of a foreign main proceeding must be 
        consistent with the foreign main proceeding.
            ``(2) If a foreign main proceeding is recognized 
        after recognition, or after the filing of a petition 
        for recognition, of a foreign nonmain proceeding, any 
        relief in effect under section 1519 or 1521 shall be 
        reviewed by the court and shall be modified or 
        terminated if inconsistent with the foreign main 
        proceeding.
            ``(3) If, after recognition of a foreign nonmain 
        proceeding, another foreign nonmain proceeding is 
        recognized, the court shall grant, modify, or terminate 
        relief for the purpose of facilitating coordination of 
        the proceedings.

``Sec. 1531. Presumption of insolvency based on recognition of a 
                    foreign main proceeding

    ``In the absence of evidence to the contrary, recognition 
of a foreign main proceeding is for the purpose of commencing a 
proceeding under section 303, proof that the debtor is 
generally not paying its debts as such debts become due.

``Sec. 1532. Rule of payment in concurrent proceedings

    ``Without prejudice to secured claims or rights in rem, a 
creditor who has received payment with respect to its claim in 
a foreign proceeding pursuant to a law relating to insolvency 
may not receive a payment for the same claim in a case under 
any other chapter of this title regarding the debtor, so long 
as the payment to other creditors of the same class is 
proportionately less than the payment the creditor has already 
received.''.
    (b) Clerical Amendment.--The table of chapters for title 
11, United States Code, is amended by inserting after the item 
relating to chapter 13 the following:

``15. Ancillary and Other Cross-Border Cases.....................1501''.

SEC. 902. AMENDMENTS TO OTHER CHAPTERS IN TITLE 11, UNITED STATES CODE.

    (a) Applicability of Chapters.--Section 103 of title 11, 
United States Code, is amended--
            (1) in subsection (a), by inserting before the 
        period the following: ``, and this chapter, sections 
        307, 304, 555 through 557, 559, and 560 apply in a case 
        under chapter 15''; and
            (2) by adding at the end the following:
    ``(j) Chapter 15 applies only in a case under such chapter, 
except that--
            ``(1) sections 1513 and 1514 apply in all cases 
        under this title; and
            ``(2) section 1505 applies to trustees and to any 
        other entity (including an examiner) authorized by the 
        court under chapters 7, 11, and 12, to debtors in 
        possession under chapters 11 and 12, and to debtors 
        under chapter 9 who are authorized to act under section 
        1505.''.
    (b) Definitions.--Paragraphs (23) and (24) of title 11, 
United States Code, are amended to read as follows:
            ``(23) `foreign proceeding' means a collective 
        judicial or administrative proceeding in a foreign 
        country, including an interim proceeding, pursuant to a 
        law relating to insolvency in which proceeding the 
        assets and affairs of the debtor are subject to control 
        or supervision by a foreign court, for the purpose of 
        reorganization or liquidation;
            ``(24) `foreign representative' means a person or 
        body, including a person or body appointed on an 
        interim basis, authorized in a foreign proceeding to 
        administer the reorganization or the liquidation of the 
        debtor's assets or affairs or to act as a 
        representative of the foreign proceeding;''.
    (c) Amendments to Title 28, United States Code.--
            (1) Procedures.--Section 157(b)(2) of title 28, 
        United States Code, is amended--
                    (A) in subparagraph (N), by striking 
                ``and'' at the end;
                    (B) in subparagraph (O), by striking the 
                period at the end and inserting ``; and''; and
                    (C) by adding at the end the following:
            ``(P) recognition of foreign proceedings and other 
        matters under chapter 15 of title 11.''.
            (2) Bankruptcy cases and proceedings.--Section 
        1334(c)(1) of title 28, United States Code, is amended 
        by striking ``Nothing in'' and inserting ``Except with 
        respect to a case under chapter 15 of title 11, nothing 
        in''.
            (3) Duties of trustees.--Section 586(a)(3) of title 
        28, United States Code, is amended by inserting ``15,'' 
        after ``chapter''.

                 TITLE X--FINANCIAL CONTRACT PROVISIONS

SEC. 1001. TREATMENT OF CERTAIN AGREEMENTS BY CONSERVATORS OR RECEIVERS 
                    OF INSURED DEPOSITORY INSTITUTIONS.

    (a) Definition of Qualified Financial Contract.--Section 
11(e)(8)(D)(i) of the Federal Deposit Insurance Act (12 U.S.C. 
1821(e)(8)(D)(i)) is amended by inserting ``, resolution or 
order'' after ``any similar agreement that the Corporation 
determines by regulation''.
    (b) Definition of Securities Contract.--Section 
11(e)(8)(D)(ii) of the Federal Deposit Insurance Act (12 U.S.C. 
1821(e)(8)(D)(ii)) is amended to read as follows:
                            ``(ii) Securities contract.--The 
                        term `securities contract'--
                                    ``(I) means a contract for 
                                the purchase, sale, or loan of 
                                a security, a certificate of 
                                deposit, a mortgage loan, or 
                                any interest in a mortgage 
                                loan, a group or index of 
                                securities, certificates of 
                                deposit, or mortgage loans or 
                                interests therein (including 
                                any interest therein or based 
                                on the value thereof) or any 
                                option on any of the foregoing, 
                                including any option to 
                                purchase or sell any such 
                                security, certificate of 
                                deposit, loan, interest, group 
                                or index, or option;
                                    ``(II) does not include any 
                                purchase, sale, or repurchase 
                                obligation under a 
                                participation in a commercial 
                                mortgage loan unless the 
                                Corporation determines by 
                                regulation, resolution, or 
                                order to include any such 
                                agreement within the meaning of 
                                such term;
                                    ``(III) means any option 
                                entered into on a national 
                                securities exchange relating to 
                                foreign currencies;
                                    ``(IV) means the guarantee 
                                by or to any securities 
                                clearing agency of any 
                                settlement of cash, securities, 
                                certificates of deposit, 
                                mortgage loans or interests 
                                therein, group or index of 
                                securities, certificates of 
                                deposit, or mortgage loans or 
                                interests therein (including 
                                any interest therein or based 
                                on the value thereof) or option 
                                on any of the foregoing, 
                                including any option to 
                                purchase or sell any such 
                                security, certificate of 
                                deposit, loan, interest, group 
                                or index or option;
                                    ``(V) means any margin 
                                loan;
                                    ``(VI) means any other 
                                agreement or transaction that 
                                is similar to any agreement or 
                                transaction referred to in this 
                                clause;
                                    ``(VII) means any 
                                combination of the agreements 
                                or transactions referred to in 
                                this clause;
                                    ``(VIII) means any option 
                                to enter into any agreement or 
                                transaction referred to in this 
                                clause;
                                    ``(IX) means a master 
                                agreement that provides for an 
                                agreement or transaction 
                                referred to in subclause (I), 
                                (III), (IV), (V), (VI), (VII), 
                                or (VIII), together with all 
                                supplements to any such master 
                                agreement, without regard to 
                                whether the master agreement 
                                provides for an agreement or 
                                transaction that is not a 
                                securities contract under this 
                                clause, except that the master 
                                agreement shall be considered 
                                to be a securities contract 
                                under this clause only with 
                                respect to each agreement or 
                                transaction under the master 
                                agreement that is referred to 
                                in subclause (I), (III), (IV), 
                                (V), (VI), (VII), or (VIII); 
                                and
                                    ``(X) means any security 
                                agreement or arrangement or 
                                other credit enhancement 
                                related to any agreement or 
                                transaction referred to in this 
                                clause.''.
    (c) Definition of Commodity Contract.--Section 
11(e)(8)(D)(iii) of the Federal Deposit Insurance Act (12 
U.S.C. 1821(e)(8)(D)(iii)) is amended to read as follows:
                            ``(iii) Commodity contract.--The 
                        term `commodity contract' means--
                                    ``(I) with respect to a 
                                futures commission merchant, a 
                                contract for the purchase or 
                                sale of a commodity for future 
                                delivery on, or subject to the 
                                rules of, a contract market or 
                                board of trade;
                                    ``(II) with respect to a 
                                foreign futures commission 
                                merchant, a foreign future;
                                    ``(III) with respect to a 
                                leverage transaction merchant, 
                                a leverage transaction;
                                    ``(IV) with respect to a 
                                clearing organization, a 
                                contract for the purchase or 
                                sale of a commodity for future 
                                delivery on, or subject to the 
                                rules of, a contract market or 
                                board of trade that is cleared 
                                by such clearing organization, 
                                or commodity option traded on, 
                                or subject to the rules of, a 
                                contract market or board of 
                                trade that is cleared by such 
                                clearing organization;
                                    ``(V) with respect to a 
                                commodity options dealer, a 
                                commodity option;
                                    ``(VI) any other agreement 
                                or transaction that is similar 
                                to any agreement or transaction 
                                referred to in this clause;
                                    ``(VII) any combination of 
                                the agreements or transactions 
                                referred to in this clause;
                                    ``(VIII) any option to 
                                enter into any agreement or 
                                transaction referred to in this 
                                clause;
                                    ``(IX) a master agreement 
                                that provides for an agreement 
                                or transaction referred to in 
                                subclause (I), (II), (III), 
                                (IV), (V), (VI), (VII), or 
                                (VIII), together with all 
                                supplements to any such master 
                                agreement, without regard to 
                                whether the master agreement 
                                provides for an agreement or 
                                transaction that is not a 
                                commodity contract under this 
                                clause, except that the master 
                                agreement shall be considered 
                                to be a commodity contract 
                                under this clause only with 
                                respect to each agreement or 
                                transaction under the master 
                                agreement that is referred to 
                                in subclause (I), (II), (III), 
                                (IV), (V), (VI), (VII), or 
                                (VIII); or
                                    ``(X) a security agreement 
                                or arrangement or other credit 
                                enhancement related to any 
                                agreement or transaction 
                                referred to in this clause.''.
    (d) Definition of Forward Contract.--Section 
11(e)(8)(D)(iv) of the Federal Deposit Insurance Act (12 U.S.C. 
1821(e)(8)(D)(iv)) is amended to read as follows:
                            ``(iv) Forward contract.--The term 
                        `forward contract' means--
                                    ``(I) a contract (other 
                                than a commodity contract) for 
                                the purchase, sale, or transfer 
                                of a commodity or any similar 
                                good, article, service, right, 
                                or interest which is presently 
                                or in the future becomes the 
                                subject of dealing in the 
                                forward contract trade,or 
product or byproduct thereof, with a maturity date more than 2 days 
after the date the contract is entered into, including a repurchase 
agreement, reverse repurchase agreement, consignment, lease, swap, 
hedge transaction, deposit, loan, option, allocated transaction, 
unallocated transaction, or any other similar agreement;
                                    ``(II) any combination of 
                                agreements or transactions 
                                referred to in subclauses (I) 
                                and (III);
                                    ``(III) any option to enter 
                                into any agreement or 
                                transaction referred to in 
                                subclause (I) or (II);
                                    ``(IV) a master agreement 
                                that provides for an agreement 
                                or transaction referred to in 
                                subclauses (I), (II), or (III), 
                                together with all supplements 
                                to any such master agreement, 
                                without regard to whether the 
                                master agreement provides for 
                                an agreement or transaction 
                                that is not a forward contract 
                                under this clause, except that 
                                the master agreement shall be 
                                considered to be a forward 
                                contract under this clause only 
                                with respect to each agreement 
                                or transaction under the master 
                                agreement that is referred to 
                                in subclause (I), (II), or 
                                (III); or
                                    ``(V) a security agreement 
                                or arrangement or other credit 
                                enhancement related to any 
                                agreement or transaction 
                                referred to in subclause (I), 
                                (II), (III), or (IV).''.
    (e) Definition of Repurchase Agreement.--Section 
11(e)(8)(D)(v) of the Federal Deposit Insurance Act (12 U.S.C. 
1821(e)(8)(D)(v)) is amended to read as follows:
                            ``(v) Repurchase agreement.--The 
                        terms `repurchase agreement' and 
                        `reverse repurchase agreement'--
                                    ``(I) mean an agreement, 
                                including related terms, which 
                                provides for the transfer of 1 
                                or more certificates of 
                                deposit, mortgage-related 
                                securities (as such term is 
                                defined in the Securities 
                                Exchange Act of 1934), mortgage 
                                loans, interests in mortgage-
                                related securities or mortgage 
                                loans, eligible bankers' 
                                acceptances, qualified foreign 
                                government securities or 
                                securities that are direct 
                                obligations of, or that are 
                                fully guaranteed by, the United 
                                States or any agency of the 
                                United States against the 
                                transfer of funds by the 
                                transferee of such certificates 
                                of deposit, eligible bankers' 
                                acceptances, securities, loans, 
                                or interests with a 
                                simultaneous agreement by such 
                                transferee to transfer to the 
                                transferor thereof certificates 
                                of deposit, eligible bankers' 
                                acceptances, securities, loans, 
                                or interests as described 
                                above, at a date certain not 
                                later than 1 year after such 
                                transfers or on demand, against 
                                the transfer of funds, or any 
                                other similar agreement;
                                    ``(II) does not include any 
                                repurchase obligation under a 
                                participation in a commercial 
                                mortgage loan unless the 
                                Corporation determines by 
                                regulation, resolution, or 
                                order to include any such 
                                participation within the 
                                meaning of such term;
                                    ``(III) means any 
                                combination of agreements or 
                                transactions referred to in 
                                subclauses (I) and (IV);
                                    ``(IV) means any option to 
                                enter into any agreement or 
                                transaction referred to in 
                                subclause (I) or (III);
                                    ``(V) means a master 
                                agreement that provides for an 
                                agreement or transaction 
                                referred to in subclause (I), 
                                (III), or (IV), together with 
                                all supplements to any such 
                                master agreement, without 
                                regard to whether the master 
                                agreement provides for an 
                                agreement or transaction that 
                                is not a repurchase agreement 
                                under this clause, except that 
                                the master agreement shall be 
                                considered to be a repurchase 
                                agreement under this subclause 
                                only with respect to each 
                                agreement or transaction under 
                                the master agreement that is 
                                referred to in subclause (I), 
                                (III), or (IV); and
                                    ``(VI) means a security 
                                agreement or arrangement or 
                                other credit enhancement 
                                related to any agreement or 
                                transaction referred to in 
                                subclause (I), (III), (IV), or 
                                (V).

                        For purposes of this clause, the term 
                        `qualified foreign government security' 
                        means a security that is a direct 
                        obligation of, or that is fully 
                        guaranteed by, the central government 
                        of a member of the Organization for 
                        Economic Cooperation and Development 
                        (as determined by regulation or order 
                        adopted by the appropriate Federal 
                        banking authority).''.
    (f) Definition of Swap Agreement.--The Federal Deposit 
Insurance Act (12 U.S.C. 1821(e)(8)(D)(vi)) is amended to read 
as follows:
                            ``(vi) Swap agreement.--The term 
                        `swap agreement' means--
                                    ``(I) any agreement, 
                                including the terms and 
                                conditions incorporated by 
                                reference in any such 
                                agreement, which is an interest 
                                rate swap, option, future, or 
                                forward agreement, including a 
                                rate floor, rate cap, rate 
                                collar,cross-currency rate 
swap, and basis swap; a spot, same day-tomorrow, tomorrow-next, 
forward, or other foreign exchange or precious metals agreement; a 
currency swap, option, future, or forward agreement; an equity index or 
equity swap, option, future, or forward agreement; a debt index or debt 
swap, option, future, or forward agreement; a credit spread or credit 
swap, option, future, or forward agreement; a commodity index or 
commodity swap, option, future, or forward agreement;
                                    ``(II) any agreement or 
                                transaction similar to any 
                                other agreement or transaction 
                                referred to in this clause that 
                                is presently, or in the future 
                                becomes, regularly entered into 
                                in the swap market (including 
                                terms and conditions 
                                incorporated by reference in 
                                such agreement) and that is a 
                                forward, swap, future, or 
                                option on 1 or more rates, 
                                currencies, commodities, equity 
                                securities or other equity 
                                instruments, debt securities or 
                                other debt instruments, or 
                                economic indices or measures of 
                                economic risk or value;
                                    ``(III) any combination of 
                                agreements or transactions 
                                referred to in this clause;
                                    ``(IV) any option to enter 
                                into any agreement or 
                                transaction referred to in this 
                                clause;
                                    ``(V) a master agreement 
                                that provides for an agreement 
                                or transaction referred to in 
                                subclause (I), (II), (III), or 
                                (IV), together with all 
                                supplements to any such master 
                                agreement, without regard to 
                                whether the master agreement 
                                contains an agreement or 
                                transaction that is not a swap 
                                agreement under this clause, 
                                except that the master 
                                agreement shall be considered 
                                to be a swap agreement under 
                                this clause only with respect 
                                to each agreement or 
                                transaction under the master 
                                agreement that is referred to 
                                in subclause (I), (II), (III), 
                                or (IV); and
                                    ``(VI) any security 
                                agreement or arrangement or 
                                other credit enhancement 
                                related to any agreements or 
                                transactions referred to in 
                                subparagraph (I), (II), (III), 
                                or (IV).

                        Such term is applicable for purposes of 
                        this Act only and shall not be 
                        construed or applied so as to challenge 
                        or affect the characterization, 
                        definition, or treatment of any swap 
                        agreement under any other statute, 
                        regulation, or rule, including the 
                        Securities Act of 1933, the Securities 
                        Exchange Act of 1934, the Public 
                        Utility Holding Company Act of 1935, 
                        the Trust Indenture Act of 1939, the 
                        Investment Company Act of 1940, the 
                        Investment Advisers Act of 1940, the 
                        Securities Investor Protection Act of 
                        1970, the Commodity Exchange Act, and 
                        the regulations promulgated by the 
                        Securities and Exchange Commission or 
                        the Commodity Futures Trading 
                        Commission.''.
    (g) Definition of Transfer.--Section 11(e)(8)(D)(viii) of 
the Federal Deposit Insurance Act (12 U.S.C. 
1821(e)(8)(D)(viii)) is amended to read as follows:
                            ``(viii) Transfer.--The term 
                        `transfer' means every mode, direct or 
                        indirect, absolute or conditional, 
                        voluntary or involuntary, of disposing 
                        of or parting with property or with an 
                        interest in property, including 
                        retention of title as a security 
                        interest and foreclosure of the 
                        depository institutions's equity of 
                        redemption.''.
    (h) Treatment of Qualified Financial Contracts.--Section 
11(e)(8) of the Federal Deposit Insurance Act (12 U.S.C. 
1821(e)(8)) is amended--
            (1) in subparagraph (A), by striking ``paragraph 
        (10)'' and inserting ``paragraphs (9) and (10)'';
            (2) in subparagraph (A)(i), by striking ``to cause 
        the termination or liquidation'' and inserting ``such 
        person has to cause the termination, liquidation, or 
        acceleration'';
            (3) by amending subparagraph (A)(ii) to read as 
        follows:
                            ``(ii) any right under any security 
                        agreement or arrangement or other 
                        credit enhancement related to 1 or more 
                        qualified financial contracts described 
                        in clause (i);''; and
            (4) by amending subparagraph (E)(ii) to read as 
        follows:
                            ``(ii) any right under any security 
                        agreement or arrangement or other 
                        credit enhancement related to 1 or more 
                        qualified financial contracts described 
                        in clause (i);''.
    (i) Avoidance of Transfers.--Section 11(e)(8)(C)(i) of the 
Federal Deposit Insurance Act (12 U.S.C. 1821(e)(8)(C)(i)) is 
amended by inserting ``section 5242 of the Revised Statutes (12 
U.S.C. 91) or any other Federal or State law relating to the 
avoidance of preferential or fraudulent transfers,'' before 
``the Corporation''.

SEC. 1002. AUTHORITY OF THE CORPORATION WITH RESPECT TO FAILED AND 
                    FAILING INSTITUTIONS.

    (a) In General.--Section 11(e)(8) of the Federal Deposit 
Insurance Act (12 U.S.C. 1821(e)(8)) is amended--
            (1) in subparagraph (E), by striking ``other than 
        paragraph (12) of this subsection, subsection (d)(9)'' 
        and inserting ``other than subsections (d)(9) and 
        (e)(10)''; and
            (2) by adding at the end the following new 
        subparagraphs:
                    ``(F) Clarification.--No provision of law 
                shall be construed as limiting the right or 
                power of the Corporation, or authorizing any 
                court or agency to limit or delay, in any 
                manner, the right or power of the Corporation 
                to transfer any qualified financial contract in 
                accordance with paragraphs (9) and (10) of this 
                subsection or to disaffirm or repudiate any 
                such contract in accordance with subsection 
                (e)(1) of this section.
                    ``(G) Walkaway clauses not effective.--
                            ``(i) In general.--Notwithstanding 
                        the provisions of subparagraphs (A) and 
                        (E), and sections 403 and 404 of the 
                        Federal Deposit Insurance Corporation 
                        Improvement Act of 1991, no walkaway 
                        clause shall be enforceable in a 
                        qualified financial contract of an 
                        insured depository institution in 
                        default.
                            ``(ii) Walkaway clause defined.--
                        For purposes of this subparagraph, the 
                        term `walkaway clause' means a 
                        provision in a qualified financial 
                        contract that, after calculation of a 
                        value of a party's position or an 
                        amount due to or from 1 of the parties 
                        in accordance with its terms upon 
                        termination, liquidation, or 
                        acceleration of the qualified financial 
                        contract, either does not create a 
                        payment obligation of a party or 
                        extinguishes a payment obligation of a 
                        party in whole or in part solely 
                        because of such party's status as a 
                        nondefaulting party.''.
    (b) Technical and Conforming Amendment.--Section 
11(e)(12)(A) of the Federal Deposit Insurance Act (12 U.S.C. 
1821(e)(12)(A)) is amended by inserting ``or the exercise of 
rights or powers'' after ``the appointment''.

SEC. 1003. AMENDMENTS RELATING TO TRANSFERS OF QUALIFIED FINANCIAL 
                    CONTRACTS.

    (a) Transfers of Qualified Financial Contracts to Financial 
Institutions.--Section 11(e)(9) of the Federal Deposit 
Insurance Act (12 U.S.C. 1821(e)(9)) is amended to read as 
follows:
            ``(9) Transfer of qualified financial contracts.--
                    ``(A) In general.--In making any transfer 
                of assets or liabilities of a depository 
                institution in default which includes any 
                qualified financial contract, the conservator 
                or receiver for such depository institution 
                shall either--
                            ``(i) transfer to 1 financial 
                        institution, other than a financial 
                        institution for which a conservator, 
                        receiver, trustee in bankruptcy, or 
                        other legal custodian has been 
                        appointed or which is otherwise the 
                        subject of a bankruptcy or insolvency 
                        proceeding--
                                    ``(I) all qualified 
                                financial contracts between any 
                                person or any affiliate of such 
                                person and the depository 
                                institution in default;
                                    ``(II) all claims of such 
                                person or any affiliate of such 
                                person against such depository 
                                institution under any such 
                                contract (other than any claim 
                                which, under the terms of any 
                                such contract, is subordinated 
                                to the claims of general 
                                unsecured creditors of such 
                                institution);
                                    ``(III) all claims of such 
                                depository institution against 
                                such person or any affiliate of 
                                such person under any such 
                                contract; and
                                    ``(IV) all property 
                                securing or any other credit 
                                enhancement for any contract 
                                described in subclause (I) or 
                                any claim described in 
                                subclause (II) or (III) under 
                                any such contract; or
                            ``(ii) transfer none of the 
                        qualified financial contracts, claims, 
                        property or other credit enhancement 
                        referred to in clause (i) (with respect 
                        to such person and any affiliate of 
                        such person).
                    ``(B) Transfer to foreign bank, foreign 
                financial institution, or branch or agency of a 
                foreign bank or financial institution.--In 
                transferring any qualified financial contracts 
                and related claims and property pursuant to 
                subparagraph (A)(i), the conservator or 
                receiver for such depository institution shall 
                not make such transfer to a foreign bank, 
                financial institution organized under the laws 
                of a foreign country, or a branch or agency of 
                a foreign bank or financial institution unless, 
                under the law applicable to such bank, 
                financial institution, branch or agency, to the 
                qualified financial contracts, and to any 
                netting contract, any security agreement or 
                arrangement or other credit enhancement related 
                to 1 or more qualified financial contracts the 
                contractual rights of the parties to such 
                qualified financial contracts, netting 
                contracts, security agreements or arrangements, 
                or other credit enhancements are enforceable 
                substantially to the same extent as permitted 
                under this section.
                    ``(C) Transfer of contracts subject to the 
                rules of a clearing organization.--In the event 
                that a conservator or receiver transfers any 
                qualified financial contract and related 
                claims, property and credit enhancements 
                pursuant to subparagraph (A)(i) and such 
                contract is subject to the rules of a clearing 
                organization, the clearing organization shall 
                not be required to accept the transferee as a 
                member by virtue of the transfer.
                    ``(D) Definition.--For purposes of this 
                section, the term `financial institution' means 
                a broker or dealer, a depository institution, a 
                futures commission merchant, or any other 
                institution as determined by the Corporation by 
                regulation to be a financial institution.''.
    (b) Notice to Qualified Financial Contract 
Counterparties.--Section 11(e)(10)(A) of the Federal Deposit 
Insurance Act (12 U.S.C. 1821(e)(10)(A)) is amended by amending 
the flush material following clause (ii) to read as follows: 
``the conservator or receiver shall notify any person who is a 
party to any such contract of such transfer by 5:00 p.m. 
(eastern time) on the business day following the date of the 
appointment of the receiver, in the case of a receivership, or 
the business day following such transfer, in the case of a 
conservatorship.''.
    (c) Rights Against Receiver and Treatment of Bridge 
Banks.--Section 11(e)(10) of the Federal Deposit Insurance Act 
(12 U.S.C. 1821(e)(10)) is further amended--
            (1) by redesignating subparagraph (B) as 
        subparagraph (D); and
            (2) by inserting after subparagraph (A) the 
        following new subparagraphs:
                    ``(B) Certain rights not enforceable.--
                            ``(i) Receivership.--A person who 
                        is a party to a qualified financial 
                        contract with an insured depository 
                        institution may not exercise any right 
                        such person has to terminate, 
                        liquidate, or net such contract under 
                        paragraph (8)(A) or section 403 or 404 
                        of the Federal Deposit Insurance 
                        Corporation Improvement Act of 1991 
                        solely by reason of or incidental to 
                        the appointment of a receiver for the 
                        depository institution (or the 
                        insolvency or financial condition of 
                        the depository institution for which 
                        the receiver has been appointed)--
                                    ``(I) until 5:00 p.m. 
                                (eastern time) on the business 
                                day following the date of the 
                                appointment of the receiver; or
                                    ``(II) after the person has 
                                received notice that the 
                                contract has been transferred 
                                pursuant to paragraph (9)(A).
                            ``(ii) Conservatorship.--A person 
                        who is a party to a qualified financial 
                        contract with an insured depository 
                        institution may not exercise any right 
                        such person has to terminate, 
                        liquidate, or net such contract under 
                        paragraph (8)(E) or sections 403 or 404 
                        of the Federal Deposit Insurance 
                        Corporation Improvement Act of 1991, 
                        solely by reason of or incidental to 
                        the appointment of a conservator for 
                        the depository institution (or the 
                        insolvency or financial condition of 
                        the depository institution for which 
                        the conservator has been appointed).
                            ``(iii) Notice.--For purposes of 
                        this subsection, the Corporation as 
                        receiver or conservator of an insured 
                        depository institution shall be deemed 
                        to have notified a person who is a 
                        party to a qualified financial contract 
                        with such depository institution if the 
                        Corporation has taken steps reasonably 
                        calculated to provide notice to such 
                        person by the time specified in 
                        subparagraph (A) of this subsection.
                    ``(C) Treatment of bridge banks.--The 
                following institutions shall not be considered 
                a financial institution for which a 
                conservator, receiver, trustee in bankruptcy, 
                or other legal custodian has been appointed or 
                which is otherwise the subject of a bankruptcy 
                or insolvency proceeding for purposes of 
                subsection (e)(9)--
                            ``(i) a bridge bank; or
                            ``(ii) a depository institution 
                        organized by the Corporation, for which 
                        a conservator is appointed either--
                                    ``(I) immediately upon the 
                                organization of the 
                                institution; or
                                    ``(II) at the time of a 
                                purchase and assumption 
                                transaction between such 
                                institution and the Corporation 
                                as receiver for a depository 
                                institution in default.''.

SEC. 1004. AMENDMENTS RELATING TO DISAFFIRMANCE OR REPUDIATION OF 
                    QUALIFIED FINANCIAL CONTRACTS.

    Section 11(e) of the Federal Deposit Insurance Act (12 
U.S.C. 1821(e)) is further amended--
            (1) by redesignating paragraphs (11) through (15) 
        as paragraphs (12) through (16), respectively; and
            (2) by inserting after paragraph (10) the following 
        new paragraph:
            ``(11) Disaffirmance or repudiation of qualified 
        financial contracts.--In exercising the rights of 
        disaffirmance or repudiation of a conservator or 
        receiver with respect to any qualified financial 
        contract to which an insured depository institution is 
        a party, the conservator or receiver for such 
        institution shall either--
                    ``(A) disaffirm or repudiate all qualified 
                financial contracts between--
                            ``(i) any person or any affiliate 
                        of such person; and
                            ``(ii) the depository institution 
                        in default; or
                    ``(B) disaffirm or repudiate none of the 
                qualified financial contracts referred to in 
                subparagraph (A) (with respect to such person 
                or any affiliate of such person).''.

SEC. 1005. CLARIFYING AMENDMENT RELATING TO MASTER AGREEMENTS.

    Section 11(e)(8)(D)(vii) of the Federal Deposit Insurance 
Act (12 U.S.C. 1821(e)(8)(D)(vii)) is amended to read as 
follows:
                            ``(vii) Treatment of master 
                        agreement as 1 agreement.--Any master 
                        agreement for any contract or agreement 
                        described in any preceding clause of 
                        this subparagraph (or any master 
                        agreement for such master agreement or 
                        agreements), together with all 
                        supplements to such master agreement, 
                        shall be treated asa single agreement 
and a single qualified financial contract. If a master agreement 
contains provisions relating to agreements or transactions that are not 
themselves qualified financial contracts, the master agreement shall be 
deemed to be a qualified financial contract only with respect to those 
transactions that are themselves qualified financial contracts.''.

SEC. 1006. FEDERAL DEPOSIT INSURANCE CORPORATION IMPROVEMENT ACT OF 
                    1991.

    (a) Definitions.--Section 402 of the Federal Deposit 
Insurance Corporation Improvement Act of 1991 (12 U.S.C. 4402) 
is amended--
            (1) in paragraph (6)--
                    (A) by redesignating subparagraphs (B) 
                through (D) as subparagraphs (C) through (E), 
                respectively;
                    (B) by inserting after subparagraph (A) the 
                following new subparagraph:
                    ``(B) an uninsured national bank or an 
                uninsured State bank that is a member of the 
                Federal Reserve System if the national bank or 
                State member bank is not eligible to make 
                application to become an insured bank under 
                section 5 of the Federal Deposit Insurance 
                Act;''; and
                    (C) by amending subparagraph (C) (as 
                redesignated) to read as follows:
                    ``(C) a branch or agency of a foreign bank, 
                a foreign bank and any branch or agency of the 
                foreign bank, or the foreign bank that 
                established the branch or agency, as those 
                terms are defined in section 1(b) of the 
                International Banking Act of 1978;'';
            (2) in paragraph (11), by adding before the period 
        ``and any other clearing organization with which such 
        clearing organization has a netting contract'';
            (3) by amending paragraph (14)(A)(i) to read as 
        follows:
                            ``(i) means a contract or agreement 
                        between 2 or more financial 
                        institutions, clearing organizations, 
                        or members that provides for netting 
                        present or future payment obligations 
                        or payment entitlements (including 
                        liquidation or closeout values relating 
                        to such obligations or entitlements) 
                        among the parties to the agreement; 
                        and''; and
            (4) by adding at the end the following new 
        paragraph:
            ``(15) Payment.--The term `payment' means a payment 
        of United States dollars, another currency, or a 
        composite currency, and a noncash delivery, including a 
        payment or delivery to liquidate an unmatured 
        obligation.''.
    (b) Enforceability of Bilateral Netting Contracts.--Section 
403 of the Federal Deposit Insurance Corporation Improvement 
Act of 1991 (12 U.S.C. 4403) is amended--
            (1) by amending subsection (a) to read as follows:
    ``(a) General Rule.--Notwithstanding any other provision of 
State or Federal law (other than paragraphs (8)(E), (8)(F), and 
(10)(B) of section 11(e) of the Federal Deposit Insurance Act 
or any order authorized under section 5(b)(2) of the Securities 
Investor Protection Act of 1970, the covered contractual 
payment obligations and the covered contractual payment 
entitlements between any 2 financial institutions shall be 
netted in accordance with, and subject to the conditions of, 
the terms of any applicable netting contract (except as 
provided in section 561(b)(2) of title 11).''; and
            (2) by adding at the end the following new 
        subsection:
    ``(f) Enforceability of Security Agreements.--The 
provisions of any security agreement or arrangement or other 
credit enhancement related to 1 or more netting contracts 
between any 2 financial institutions shall be enforceable in 
accordance with their terms (except as provided in section 
561(b)(2) of title 11) and shall not be stayed, avoided, or 
otherwise limited by any State or Federal law (other than 
paragraphs (8)(E), (8)(F), and (10)(B) of section 11(e) of the 
Federal Deposit Insurance Act and section 5(b)(2) of the 
Securities Investor Protection Act of 1970).''.
    (c) Enforceability of Clearing Organization Netting 
Contracts.--Section 404 of the Federal Deposit Insurance 
Corporation Improvement Act of 1991 (12 U.S.C. 4404) is 
amended--
            (1) by amending subsection (a) to read as follows:
    ``(a) General Rule.--Notwithstanding any other provision of 
State or Federal law (other than paragraphs (8)(E), (8)(F), and 
(10)(B) of section 11(e) of the Federal Deposit Insurance Act 
and any order authorized under section 5(b)(2) of the 
Securities Investor Protection Act of 1970, the covered 
contractual payment obligations and the covered contractual 
payment entitlements of a member of a clearing organization to 
and from all other members of a clearing organization shall be 
netted in accordance with and subject to the conditions of any 
applicable netting contract (except as provided in section 
561(b)(2) of title 11, United States Code).''; and
            (2) by adding at the end the following new 
        subsection:
    ``(h) Enforceability of Security Agreements.--The 
provisions of any security agreement or arrangement or other 
credit enhancement related to 1 or more netting contracts 
between any 2 members of a clearing organization shall be 
enforceable in accordance with their terms (except as provided 
in section 561(b)(2) of title 11, United States Code) and shall 
not be stayed, avoided, or otherwise limited by any State or 
Federal law other than paragraphs (8)(E), (8)(F), and (10)(B) 
of section 11(e) of the Federal Deposit Insurance Act and 
section 5(b)(2) of the Securities Investor Protection Act of 
1970.''.
    (d) Enforceability of Contracts With Uninsured National 
Banks and Uninsured Federal Branches and Agencies.--The Federal 
Deposit Insurance Corporation Improvement Act of 1991 (12 
U.S.C. 4401 et seq.) is amended--
            (1) by redesignating section 407 as section 408; 
        and
            (2) by adding after section 406 the following new 
        section:

``SEC. 407. TREATMENT OF CONTRACTS WITH UNINSURED NATIONAL BANKS AND 
                    UNINSURED FEDERAL BRANCHES AND AGENCIES.

    ``(a) In General.--Notwithstanding any other provision of 
law, paragraphs (8), (9), (10), and (11) of section 11(e) of 
the Federal Deposit Insurance Act shall apply to an uninsured 
national bank or uninsured Federal branch or Federal agency 
except--
            ``(1) any reference to the `Corporation as 
        receiver' or `the receiver or the Corporation' shall 
        refer to the receiver of an uninsured national bank or 
        uninsured Federal branch or Federal agency appointed by 
        the Comptroller of the Currency;
            ``(2) any reference to the `Corporation' (other 
        than in section 11(e)(8)(D) of such Act), the 
        `Corporation, whether acting as such or as conservator 
        or receiver', a `receiver', or a `conservator' shall 
        refer to the receiver or conservator of an uninsured 
        national bank or uninsured Federal branch or Federal 
        agency appointed by the Comptroller of the Currency; 
        and
            ``(3) any reference to an `insured depository 
        institution' or `depository institution' shall refer to 
        an uninsured national bank or an uninsured Federal 
        branch or Federal agency.
    ``(b) Liability.--The liability of a receiver or 
conservator of an uninsured national bank or uninsured Federal 
branch or agency shall be determined in the same manner and 
subject to the same limitations that apply to receivers and 
conservators of insured depository institutions under section 
11(e) of the Federal Deposit Insurance Act.
    ``(c) Regulatory Authority.--
            ``(1) In general.--The Comptroller of the Currency, 
        in consultation with the Federal Deposit Insurance 
        Corporation, may promulgate regulations to implement 
        this section.
            ``(2) Specific requirement.--In promulgating 
        regulations to implement this section, the Comptroller 
        of the Currency shall ensure that the regulations 
        generally are consistent with the regulations and 
        policies of the Federal Deposit Insurance Corporation 
        adopted pursuant to the Federal Deposit Insurance Act.
    ``(d) Definitions.--For purposes of this section, the terms 
`Federal branch', `Federal agency', and `foreign bank' have the 
same meaning as in section 1(b) of the International Banking 
Act.''.

SEC. 1007. BANKRUPTCY CODE AMENDMENTS.

    (a) Definitions of Forward Contract, Repurchase Agreement, 
Securities Clearing Agency, Swap Agreement, Commodity Contract, 
and Securities Contract.--Title 11, United States Code, is 
amended--
            (1) in section 101--
                    (A) in paragraph (25)--
                            (i) by striking ``means a 
                        contract'' and inserting ``means--
                    ``(A) a contract'';
                            (ii) by striking ``, or any 
                        combination thereof or option 
                        thereon;'' and inserting ``, or any 
                        other similar agreement;''; and
                            (iii) by adding at the end the 
                        following:
                    ``(B) a combination of agreements or 
                transactions referred to in subparagraphs (A) 
                and (C);
                    ``(C) an option to enter into an agreement 
                or transaction referred to in subparagraph (A) 
                or (B);
                    ``(D) a master netting agreement that 
                provides for an agreement or transaction 
                referred to in subparagraph (A), (B), or (C), 
                together with all supplements to such master 
                netting agreement, without regard to whether 
                such master netting agreement provides for an 
                agreement or transaction that is not a forward 
                contract under this paragraph, except that such 
                master netting agreement shall be considered to 
                be a forward contract under this paragraph only 
                with respect to each agreement or transaction 
                under such master netting agreement that is 
                referred to in subparagraph (A), (B) or (C); or
                    ``(E) a security agreement or arrangement, 
                or other credit enhancement, directly 
                pertaining to a contract, option, agreement, or 
                transaction referred to in subparagraph (A), 
                (B), (C), or (D), but not to exceed the actual 
                value of such contract, option, agreement, or 
                transaction on the date of the filing of the 
                petition;'';
                    (B) by amending paragraph (47) to read as 
                follows:
            ``(47) `repurchase agreement' and `reverse 
        repurchase agreement'--
                    ``(A) mean--
                            ``(i) an agreement, including 
                        related terms, which provides for the 
                        transfer of--
                                    ``(I) a certificate of 
                                deposit, mortgage-related 
                                security (as defined in the 
                                Securities Exchange Act of 
                                1934), mortgage loan, interest 
                                in a mortgage-related security 
                                or mortgage loan, eligible 
                                bankers' acceptance, qualified 
                                foreign government security; or
                                    ``(II) security that is a 
                                direct obligation of, or that 
                                is fully guaranteed by, the 
                                United States or an agency of 
                                the United States against the 
                                transfer of funds by the 
                                transferee of such certificate 
                                of deposit, eligible bankers' 
                                acceptance, security, loan, or 
                                interest;
                        with a simultaneous agreement by such 
                        transferee to transfer to the 
                        transferor thereof a certificate of 
                        deposit, eligible bankers' acceptance, 
                        security, loan, or interest of the kind 
                        described in subclause (I) or (II), at 
                        a date certain not later than 1 year 
                        after the transferor's transfer or on 
                        demand, against the transfer of funds;
                            ``(ii) a combination of agreements 
                        or transactions referred to in clauses 
                        (i) and (iii);
                            ``(iii) an option to enter into an 
                        agreement or transaction referred to in 
                        clause (i) or (ii);
                            ``(iv) a master netting agreement 
                        that provides for an agreement or 
                        transaction referred to in clause (i), 
                        (ii), or (iii), together with all 
                        supplements to such master netting 
                        agreement, without regard to whether 
                        such master netting agreement provides 
                        for an agreement or transaction that is 
                        not a repurchase agreement under this 
                        subparagraph, except that such master 
                        netting agreement shall be considered 
                        to be a repurchase agreement under this 
                        subparagraph only with respect to each 
                        agreement or transaction under such 
                        master netting agreement that is 
                        referred to in clause (i), (ii), or 
                        (iii); or
                            ``(v) a security agreement or 
                        arrangement, or other credit 
                        enhancement, directly pertaining to a 
                        contract referred to in clause (i), 
                        (ii), (iii), or (iv), but not to exceed 
                        the actual value of such contract on 
                        the date of the filing of the petition; 
                        and
                    ``(B) do not include a repurchase 
                obligation under a participation in a 
                commercial mortgage loan;

        and, for purposes of this paragraph, the term 
        `qualified foreign government security' means a 
        security that is a direct obligation of, or that is 
        fully guaranteed by, the central government of a member 
        of the Organization for Economic Cooperation and 
        Development;'';
                    (C) in paragraph (48) by inserting ``or 
                exempt from such registration under such 
                section pursuant to an order of the Securities 
                and Exchange Commission'' after ``1934''; and
                    (D) by amending paragraph (53B) to read as 
                follows:
            ``(53B) `swap agreement' means--
                    ``(A) an agreement, including the terms and 
                conditions incorporated by reference in such 
                agreement, that is--
                            ``(i) an interest rate swap, 
                        option, future, or forward agreement, 
                        including a rate floor, rate cap, rate 
                        collar, cross-currency rate swap, and 
                        basis swap;
                            ``(ii) a spot, same day-tomorrow, 
                        tomorrow-next, forward, or other 
                        foreign exchange or precious metals 
                        agreement;
                            ``(iii) a currency swap, option, 
                        future, or forward agreement;
                            ``(iv) an equity index or an equity 
                        swap, option, future, or forward 
                        agreement;
                            ``(v) a debt index or a debt swap, 
                        option, future, or forward agreement;
                            ``(vi) a credit spread or a credit 
                        swap, option, future, or forward 
                        agreement; or
                            ``(vii) a commodity index or a 
                        commodity swap, option, future, or 
                        forward agreement;
                    ``(B) an agreement or transaction similar 
                to an agreement or transaction referred to in 
                this paragraph that--
                            ``(i) is currently, or in the 
                        future becomes, regularly entered into 
                        in the swap market (including terms and 
                        conditions incorporated by reference 
                        therein); and
                            ``(ii) is a forward, swap, future, 
                        or option on a rate, currency, 
                        commodity, equity security, or other 
                        equity instrument, on a debt security 
                        or other debt instrument, or on an 
                        economic index or measure of economic 
                        risk or value;
                    ``(C) a combination of agreements or 
                transactions referred to in this paragraph;
                    ``(D) an option to enter into an agreement 
                or transaction referred to in this paragraph;
                    ``(E) a master netting agreement that 
                provides for an agreement or transaction 
                referred to in subparagraph (A), (B), (C), or 
                (D), together with all supplements to such 
                master netting agreement and without regard to 
                whether such master netting agreement contains 
                an agreement or transaction described in any 
                such subparagraph, but only with respect to 
                each agreement or transaction referred to in 
                any such subparagraph that is under such master 
                netting agreement; or
                    ``(F) is applicable for purposes of this 
                title only and shall not be construed or 
                applied so as to challenge or affect the 
                characterization, definition, or treatment of 
                any swap agreement under any other statute, 
                regulation, or rule, including the Securities 
                Act of 1933, the Securities Exchange Act of 
                1934, the Public Utility Holding Company Act of 
                1935, the Trust Indenture Act of 1939, the 
                Investment Company Act of 1940, the Investment 
                Advisers Act of 1940, the Securities Investor 
                Protection Act of 1970, the Commodity Exchange 
                Act, and the regulations prescribed by the 
                Securities and Exchange Commission or the 
                Commodity Futures Trading Commission.'';
            (2) by amending section 741(7) to read as follows:
            ``(7) `securities contract'--
                    ``(A) means--
                            ``(i) a contract for the purchase, 
                        sale, or loan of a security, a mortgage 
                        loan or an interest in a mortgage loan, 
                        a group or index of securities, or 
                        mortgage loans or interests therein 
                        (including an interest therein or based 
                        on the value thereof), or option on any 
                        of the foregoing, including an option 
                        to purchase or sell any of the 
                        foregoing;
                            ``(ii) an option entered into on a 
                        national securities exchange relating 
                        to foreign currencies;
                            ``(iii) the guarantee by or to a 
                        securities clearing agency of a 
                        settlement of cash, securities, 
                        mortgage loans or interests therein, 
                        group or index of securities, or 
                        mortgage loans or interests therein 
                        (including any interest therein or 
                        based on the value thereof), or option 
                        on any of the foregoing, including an 
                        option to purchase or sell any of the 
                        foregoing;
                            ``(iv) a margin loan;
                            ``(v) any other agreement or 
                        transaction that is similar to an 
                        agreement or transaction referred to in 
                        this subparagraph;
                            ``(vi) a combination of the 
                        agreements or transactions referred to 
                        in this subparagraph;
                            ``(vii) an option to enter into an 
                        agreement or transaction referred to in 
                        this subparagraph;
                            ``(viii) a master netting agreement 
                        that provides for an agreement or 
                        transaction referred to in clause (i), 
                        (ii), (iii), (iv), (v), (vi), or (vii), 
                        together with all supplements to such 
                        master netting agreement, without 
                        regard to whether such master netting 
                        agreement provides for an agreement or 
                        transaction that is not a securities 
                        contract under this subparagraph, 
                        except that such master netting 
                        agreement shall be considered to be a 
                        securities contract under this 
                        subparagraph only with respect to each 
                        agreement or transaction under such 
                        master netting agreement that is 
                        referred to in clause (i), (ii), (iii), 
                        (iv), (v), (vi), or (vii); or
                            ``(ix) a security agreement or 
                        arrangement, or other credit 
                        enhancement, directly pertaining to a 
                        contract referred to in this 
                        subparagraph, but not to exceed the 
                        actual value of such contract on the 
                        date of the filing of the petition; and
                    ``(B) does not include a purchase, sale, or 
                repurchase obligation under a participation in 
                a commercial mortgage loan;''; and
            (3) in section 761(4)--
                    (A) by striking ``or'' at the end of 
                subparagraph (D); and
                    (B) by adding at the end the following:
                    ``(F) any other agreement or transaction 
                that is similar to an agreement or transaction 
                referred to in this paragraph;
                    ``(G) a combination of the agreements or 
                transactions referred to in this paragraph;
                    ``(H) an option to enter into an agreement 
                or transaction referred to in this paragraph;
                    ``(I) a master netting agreement that 
                provides for an agreement or transaction 
                referred to in subparagraph (A), (B), (C), (D), 
                (E), (F), (G), or (H), together with all 
                supplements to such master netting agreement, 
                without regard to whether such master netting 
                agreement provides for an agreement or 
                transaction that is not a commodity contract 
                under this paragraph, except that such master 
                netting agreement shall be considered to be a 
                commodity contract under this paragraph only 
                with respect to each agreement or transaction 
                under such master netting agreement that is 
                referred to in subparagraph (A), (B), (C), (D), 
                (E), (F), (G), or (H); or
                    ``(J) a security agreement or arrangement, 
                or other credit enhancement, directly 
                pertaining to a contract referred to in this 
                paragraph, but not to exceed the actual value 
                of such contract on the date of the filing of 
                the petition;''.
    (b) Definitions of Financial Institution, Financial 
Participant, and Forward Contract Merchant.--Section 101 of 
title 11, United States Code, is amended--
            (1) by amending paragraph (22) to read as follows:
            ``(22) `financial institution' means--
                    ``(A) a Federal reserve bank, or an entity 
                that is a commercial or savings bank, 
                industrial savings bank, savings and loan 
                association, trust company, or receiver or 
                conservator for such entity and, when such 
                Federal reserve bank, receiver, or conservator 
                or entity is acting as agent or custodian for a 
                customer in connection with a securities 
                contract, as defined in section 741 of this 
                title, such customer; or
                    ``(B) in connection with a securities 
                contract, as defined in section 741 of this 
                title, an investment company registered under 
                the Investment Company Act of 1940;'';
            (2) by inserting after paragraph (22) the 
        following:
            ``(22A) `financial participant' means an entity 
        that is a party to a securities contract, commodity 
        contract or forward contract, or on the date of the 
        filing of the petition, has a commodity contract (as 
        defined in section 761 of this title) with the debtor 
        or any other entity (other than an affiliate) of a 
        total gross dollar value of at least $1,000,000,000 in 
        notional or actual principal amount outstanding on any 
        day during the previous 15-month period, or has gross 
        mark-to-market positions of at least $100,000,000 
        (aggregated across counterparties) in any such 
        agreement or transaction with the debtor or any other 
        entity (other than an affiliate) on any day during the 
        previous 15-month period;''; and
            (3) by amending paragraph (26) to read as follows:
            ``(26) `forward contract merchant' means a Federal 
        reserve bank, or an entity whose business consists in 
        whole or in part of entering into forward contracts as 
        or with merchants or in a commodity, as defined or in 
        section 761 of this title, or any similar good, 
        article, service, right, or interest which is presently 
        or in the future becomes the subject of dealing or in 
        the forward contract trade;''.
    (c) Definition of Master Netting Agreement and Master 
Netting Agreement Participant.--Section 101 of title 11, United 
States Code, is amended by inserting after paragraph (38) the 
following new paragraphs:
            ``(38A) the term `master netting agreement' means 
        an agreement providing for the exercise of rights, 
        including rights of netting, setoff, liquidation, 
        termination, acceleration, or closeout, under or in 
        connection with 1 or more contracts that are described 
        in any 1 or more of paragraphs (1) through (5) of 
        section 561(a), or any security agreement or 
        arrangement or other credit enhancement related to 1 or 
        more of the foregoing. If a master netting agreement 
        contains provisions relating to agreements or 
        transactions that are not contracts described in 
        paragraphs (1) through (5) of section 561(a), the 
        master netting agreement shall be deemed to be a master 
        netting agreement only with respect to those agreements 
        or transactions that are described in any 1 or more of 
        the paragraphs (1) through (5) of section 561(a);
            ``(38B) the term `master netting agreement 
        participant' means an entity that, at any time before 
        the filing of the petition, is a party to an 
        outstanding master netting agreement with the 
        debtor;''.
    (d) Swap Agreements, Securities Contracts, Commodity 
Contracts, Forward Contracts, Repurchase Agreements, and Master 
Netting Agreements Under the Automatic-Stay.--
            (1) In general.--Section 362(b) of title 11, United 
        States Code, as amended by sections 120, 134, 139, 203 
        and 818, is amended--
                    (A) in paragraph (6), by inserting ``, 
                pledged to, and under the control of,'' after 
                ``held by'';
                    (B) in paragraph (7), by inserting ``, 
                pledged to, and under the control of,'' after 
                ``held by'';
                    (C) by amending paragraph (17) to read as 
                follows:
            ``(17) under subsection (a), of the setoff by a 
        swap participant of a mutual debt and claim under or in 
        connection with a swap agreement that constitutes the 
        setoff of a claim against the debtor for a payment or 
        transfer due from the debtor under or in connection 
        with a swap agreement against a payment due to the 
        debtor from the swap participant under or in connection 
        with a swap agreement or against cash, securities, or 
        other property held by, pledged to, and under the 
        control of, or due from such swap participant to 
        guarantee, secure, or settle a swap agreement;'';
                    (D) in paragraph (27), by striking ``or'' 
                at the end;
                    (E) in paragraph (28) by striking the 
                period at the end and inserting ``; and''; and
                    (F) by inserting after paragraph (28) the 
                following new paragraph:
            ``(29) under subsection (a), of the setoff by a 
        master netting agreement participant of a mutual debt 
        and claim under or in connection with 1 or more master 
        netting agreements or any contract or agreement subject 
        to such agreements that constitutes the setoff of a 
        claim against the debtor for any payment or other 
        transfer of property due from the debtor under or in 
        connection with such agreements or any contract or 
        agreement subject to such agreements against any 
        payment due to the debtor from such master netting 
        agreement participant under or in connection with such 
        agreements or any contract or agreement subject to such 
        agreements oragainst cash, securities, or other 
property held by, pledged or and under the control of, or due from such 
master netting agreement participant to margin, guarantee, secure, or 
settle such agreements or any contract or agreement subject to such 
agreements, to the extent such participant is eligible to exercise such 
offset rights under paragraph (6), (7), or (17) for each individual 
contract covered by the master netting agreement in issue.''.
            (2) Limitation.--Section 362 of title 11, United 
        States Code, is amended by adding at the end the 
        following:
    ``(i) Limitation.--The exercise of rights not subject to 
the stay arising under subsection (a) pursuant to paragraph 
(6), (7), or (17) of subsection (b) shall not be stayed by an 
order of a court or administrative agency in any proceeding 
under this title.''.
    (e) Limitation of Avoidance Powers Under Master Netting 
Agreement.--Section 546 of title 11, United States Code, is 
amended--
            (1) in subsection (g) (as added by section 103 of 
        Public Law 101-311)--
                    (A) by striking ``under a swap agreement'';
                    (B) by striking ``in connection with a swap 
                agreement'' and inserting ``under or in 
                connection with any swap agreement'';
            (2) by redesignating subsection (g) (as added by 
        section 222(a) of Public Law 103-394) as subsection 
        (i); and
            (3) by inserting before subsection (i) (as 
        redesignated) the following new subsection:
    ``(h) Notwithstanding sections 544, 545, 547, 548(a)(2)(B), 
and 548(b) of this title, the trustee may not avoid a transfer 
made by or to a master netting agreement participant under or 
in connection with any master netting agreement or any 
individual contract covered thereby that is made before the 
commencement of the case, and except to the extent the trustee 
could otherwise avoid such a transfer made under an individual 
contract covered by such master netting agreement, except under 
section 548(a)(1)(A) of this title.''.
    (f) Fraudulent Transfers of Master Netting Agreements.--
Section 548(d)(2) of title 11, United States Code, is amended--
            (1) in subparagraph (C), by striking ``and'';
            (2) in subparagraph (D), by striking the period and 
        inserting ``; and''; and
            (3) by adding at the end the following new 
        subparagraph:
                    ``(E) a master netting agreement 
                participant that receives a transfer in 
                connection with a master netting agreement or 
                any individual contract covered thereby takes 
                for value to the extent of such transfer, 
                except, with respect to a transfer under any 
                individual contract covered thereby, to the 
                extent such master netting agreement 
                participant otherwise did not take (or is 
                otherwise not deemed to have taken) such 
                transfer for value.''.
    (g) Termination or Acceleration of Securities Contracts.--
Section 555 of title 11, United States Code, is amended--
            (1) by amending the section heading to read as 
        follows:

``Sec. 555. Contractual right to liquidate, terminate, or accelerate a 
                    securities contract''; and

            (2) in the first sentence, by striking 
        ``liquidation'' and inserting ``liquidation, 
        termination, or acceleration''.
    (h) Termination or Acceleration of Commodities or Forward 
Contracts.--Section 556 of title 11, United States Code, is 
amended--
            (1) by amending the section heading to read as 
        follows:

``Sec. 556. Contractual right to liquidate, terminate, or accelerate a 
                    commodities contract or forward contract''; and

            (2) in the first sentence, by striking 
        ``liquidation'' and inserting ``liquidation, 
        termination, or acceleration''.
    (i) Termination or Acceleration of Repurchase Agreements.--
Section 559 of title 11, United States Code, is amended--
            (1) by amending the section heading to read as 
        follows:

``Sec. 559. Contractual right to liquidate, terminate, or accelerate a 
                    repurchase agreement''; and

            (2) in the first sentence, by striking 
        ``liquidation'' and inserting ``liquidation, 
        termination, or acceleration''.
    (j) Liquidation, Termination, or Acceleration of Swap 
Agreements.--Section 560 of title 11, United States Code, is 
amended--
            (1) by amending the section heading to read as 
        follows:

``Sec. 560. Contractual right to liquidate, terminate, or accelerate a 
                    swap agreement''; and

            (2) in the first sentence, by striking 
        ``termination of a swap agreement'' and inserting 
        ``liquidation, termination, or acceleration of a swap 
        agreement''; and
            (3) by striking ``in connection with any swap 
        agreement'' and inserting ``in connection with the 
        termination, liquidation, or acceleration of a swap 
        agreement''.
    (k) Liquidation, Termination, Acceleration, or Offset Under 
a Master Netting Agreement and Across Contracts.--Title 11, 
United States Code, is amended by inserting after section 560 
the following new section:

``Sec. 561. Contractual right to terminate, liquidate, accelerate, or 
                    offset under a master netting agreement and across 
                    contracts

    ``(a) In General.--Subject to subsection (b), the exercise 
of any contractual right, because of a condition of the kind 
specified in section 365(e)(1), to cause the termination, 
liquidation, or acceleration of or to offset or net termination 
values, payment amounts or other transfer obligations arising 
under or in connection with 1 or more (or the termination, 
liquidation, or acceleration of 1 or more--
            ``(1) securities contracts, as defined in section 
        741(7);
            ``(2) commodity contracts, as defined in section 
        761(4);
            ``(3) forward contracts;
            ``(4) repurchase agreements;
            ``(5) swap agreements; or
            ``(6) master netting agreements,
shall not be stayed, avoided, or otherwise limited by operation 
of any provision of this title or by any order of a court or 
administrative agency in any proceeding under this title.
    ``(b) Exception.--
            ``(1) A party may exercise a contractual right 
        described in subsection (a) to terminate, liquidate, or 
        accelerate only to the extent that such party could 
        exercise such a right under section 555, 556, 559, or 
        560 for each individual contract covered by the master 
        netting agreement in issue.
            ``(2) If a debtor is a commodity broker subject to 
        subchapter IV of chapter 7 of this title--
                    ``(A) a party may not net or offset an 
                obligation to the debtor arising under, or in 
                connection with, a commodity contract against 
                any claim arising under, or in connection with, 
                other instruments, contracts, or agreements 
                listed in subsection (a) except to the extent 
                the party has no positive net equity in the 
                commodity accounts at the debtor, as calculated 
                under subchapter IV;
                    ``(B) another commodity broker may not net 
                or offset an obligation to the debtor arising 
                under, or in connection with, a commodity 
                contract entered into or held on behalf of a 
                customer of the debtor against any claim 
                arising under, or in connection with, other 
                instruments, contracts, or agreements listed in 
                subsection (a).
    ``(c) Definition.--As used in this section, the term 
`contractual right' includes a right set forth in a rule or 
bylaw of a national securities exchange, a national securities 
association, or a securities clearing agency, a right set forth 
in a bylaw of a clearing organization or contract market or in 
a resolution of the governing board thereof, and a right, 
whether or not evidenced in writing, arising under common law, 
under law merchant, or by reason of normal business 
practice.''.
    (l) Municipal Bankruptcies.--Section 901 of title 11, 
United States Code, is amended--
            (1) by inserting ``, 555, 556'' after ``553''; and
            (2) by inserting ``, 559, 560, 561,'' after 
        ``557''.
    (m) Ancillary Proceedings.--Section 304 of title 11, United 
States Code, is amended by adding at the end the following:
    ``(d) Any provisions of this title relating to securities 
contracts, commodity contracts, forward contracts, repurchase 
agreements, swap agreements, or master netting agreements shall 
apply in a case ancillary to a foreign proceeding under this 
section or any other section of this title, so that enforcement 
of contractual provisions of such contracts and agreements in 
accordance with their terms will not be stayed or otherwise 
limited by operation of any provision of this title or by order 
of a court in any case under this title, and to limit avoidance 
powers to the same extent as in a proceeding under chapter 7 or 
11 of this title (such enforcement not to be limited based on 
the presence or absence of assets of the debtor in the United 
States).''.
    (n) Commodity Broker Liquidations.--Title 11, United States 
Code, is amended by inserting after section 766 the following:

``Sec. 767. Commodity broker liquidation and forward contract 
                    merchants, commodity brokers, stockbrokers, 
                    financial institutions, securities clearing 
                    agencies, swap participants, repo participants, and 
                    master netting agreement participants

    ``Notwithstanding any other provision of this title, the 
exercise of rights by a forward contract merchant, commodity 
broker, stockbroker, financial institution, securities clearing 
agency, swap participant, repo participant, or master netting 
agreement participant under this title shall not affect the 
priority of any unsecured claim it may have after the exercise 
of such rights.''.
    (o) Stockbroker Liquidations.--Title 11, United States 
Code, is amended by inserting after section 752 the following:

``Sec. 753. Stockbroker liquidation and forward contract merchants, 
                    commodity brokers, stockbrokers, financial 
                    institutions, securities clearing agencies, swap 
                    participants, repo participants, and master netting 
                    agreement participants

    ``Notwithstanding any other provision of this title, the 
exercise of rights by a forward contract merchant, commodity 
broker, stockbroker, financial institution, securities clearing 
agency, swap participant, repo participant, financial 
participant, or master netting agreement participant under this 
title shall not affect the priority of any unsecured claim it 
may have after the exercise of such rights.''.
    (p) Setoff.--Section 553 of title 11, United States Code, 
is amended--
            (1) in subsection (a)(3)(C), by inserting ``(except 
        for a setoff of a kind described in section 362(b)(6), 
        362(b)(7), 362(b)(17), 362(b)(19), 555, 556, 559, or 
        560 of this title)'' before the period; and
            (2) in subsection (b)(1), by striking 
        ``362(b)(14),'' and inserting ``362(b)(17), 362(b)(19), 
        555, 556, 559, 560,''.
    (q) Securities Contracts, Commodity Contracts, and Forward 
Contracts.--Title 11, United States Code, is amended--
            (1) in section 362(b)(6), by striking ``financial 
        institutions,'' each place such term appears and 
        inserting ``financial institution, financial 
        participant'';
            (2) in section 546(e), by inserting ``financial 
        participant'' after ``financial institution,'';
            (3) in section 548(d)(2)(B), by inserting 
        ``financial participant'' after ``financial 
        institution,'';
            (4) in section 555--
                    (A) by inserting ``financial participant'' 
                after ``financial institution,''; and
                    (B) by inserting before the period ``, a 
                right set forth in a bylaw of a clearing 
                organization or contract market or in a 
                resolution of the governing board thereof, and 
                a right, whether or not in writing, arising 
                under common law, under law merchant, or by 
                reason of normal business practice''; and
            (5) in section 556, by inserting ``, financial 
        participant'' after ``commodity broker''.
    (r) Conforming Amendments.--Title 11 of the United States 
Code is amended--
            (1) in the table of sections of chapter 5--
                    (A) by amending the items relating to 
                sections 555 and 556 to read as follows:

``555. Contractual right to liquidate, terminate, or accelerate a 
          securities contract.
``556. Contractual right to liquidate, terminate, or accelerate a 
          commodities contract or forward contract.''; and

                    (B) by amending the items relating to 
                sections 555 and 556 to read as follows:

``559. Contractual right to liquidate, terminate, or accelerate a 
          repurchase agreement.
``560. Contractual right to liquidate, terminate, or accelerate a swap 
          agreement.''; and

            (2) in the table of sections of chapter 7--
                    (A) by inserting after the item relating to 
                section 766 the following:

``767. Commodity broker liquidation and forward contract merchants, 
          commodity brokers, stockbrokers, financial institutions, 
          securities clearing agencies, swap participants, repo 
          participants, and master netting agreement participants.''; 
          and

                    (B) by inserting after the item relating to 
                section 752 the following:

``753. Stockbroker liquidation and forward contract merchants, commodity 
          brokers, stockbrokers, financial institutions, securities 
          clearing agencies, swap participants, repo participants, and 
          master netting agreement participants.''.

SEC. 1008. RECORDKEEPING REQUIREMENTS.

    Section 11(e)(8) of the Federal Deposit Insurance Act (12 
U.S.C. 1821(e)(8)) is amended by adding at the end the 
following new subparagraph:
                    ``(H) Recordkeeping requirements.--The 
                Corporation, in consultation with the 
                appropriate Federal banking agencies, may 
                prescribe regulations requiring more detailed 
                recordkeeping with respect to qualified 
                financial contracts (including market 
                valuations) by insured depository 
                institutions.''.

SEC. 1009. EXEMPTIONS FROM CONTEMPORANEOUS EXECUTION REQUIREMENT.

    Section 13(e)(2) of the Federal Deposit Insurance Act (12 
U.S.C. 1823(e)(2)) is amended to read as follows:
            ``(2) Exemptions from contemporaneous execution 
        requirement.--An agreement to provide for the lawful 
        collateralization of--
                    ``(A) deposits of, or other credit 
                extension by, a Federal, State, or local 
                governmental entity, or of any depositor 
                referred to in section 11(a)(2), including an 
                agreement to provide collateral in lieu of a 
                surety bond;
                    ``(B) bankruptcy estate funds pursuant to 
                section 345(b)(2) of title 11, United States 
                Code;
                    ``(C) extensions of credit, including any 
                overdraft, from a Federal reserve bank or 
                Federal home loan bank; or
                    ``(D) 1 or more qualified financial 
                contracts, as defined in section 11(e)(8)(D),

        shall not be deemed invalid pursuant to paragraph 
        (1)(B) solely because such agreement was not executed 
        contemporaneously with the acquisition of the 
        collateral or because of pledges, delivery, or 
        substitution of the collateral made in accordance with 
        such agreement.''.

SEC. 1010. DAMAGE MEASURE.

    (a) Title 11, United States Code, is amended--
            (1) by inserting after section 561 the following:

``Sec. 562. Damage measure in connection with swap agreements, 
                    securities contracts, forward contracts, commodity 
                    contracts, repurchase agreements, or master netting 
                    agreements

    ``If the trustee rejects a swap agreement, securities 
contract as defined in section 741 of this title, forward 
contract, commodity contract (as defined in section 761 of this 
title) repurchase agreement, or master netting agreement 
pursuant to section 365(a) of this title, or if a forward 
contract merchant, stockbroker, financial institution, 
securities clearing agency, repo participant, financial 
participant, master netting agreement participant, or swap 
participant liquidates, terminates, or accelerates such 
contract or agreement, damages shall be measured as of the 
earlier of--
            ``(1) the date of such rejection; or
            ``(2) the date of such liquidation, termination, or 
        acceleration.''; and
            (2) in the table of sections of chapter 5 by 
        inserting after the item relating to section 561 the 
        following:

``562. Damage measure in connection with swap agreements, securities 
          contracts, forward contracts, commodity contracts, repurchase 
          agreements, or master netting agreements.''.

    (b) Claims Arising From Rejection.--Section 502(g) of title 
11, United States Code, is amended--
            (1) by designating the existing text as paragraph 
        (1); and
            (2) by adding at the end the following:
    ``(2) A claim for damages calculated in accordance with 
section 561 of this title shall be allowed under subsection 
(a), (b), or (c), or disallowed under subsection (d) or (e), as 
if such claim had arisen before the date of the filing of the 
petition.''.

SEC. 1011. SIPC STAY.

    Section 5(b)(2) of the Securities Investor Protection Act 
of 1970 (15 U.S.C. 78eee(b)(2)) is amended by adding after 
subparagraph (B) the following new subparagraph:
                    ``(C) Exception from stay.--
                            ``(i) Notwithstanding section 362 
                        of title 11, United States Code, 
                        neither the filing of an application 
                        under subsection (a)(3) nor any order 
                        or decree obtained by Securities 
                        Investor Protection Corporation from 
                        the court shall operate as a stay of 
                        any contractual rights of a creditor to 
                        liquidate, terminate, or accelerate a 
                        securities contract, commodity 
                        contract, forward contract, repurchase 
                        agreement, swap agreement, or master 
                        netting agreement, each as defined in 
                        title 11, to offset or net termination 
                        values, payment amounts, or other 
                        transfer obligations arising under or 
                        in connection with 1 or more of such 
                        contracts or agreements, or to 
                        foreclose on any cash collateral 
                        pledged by the debtor whether or not 
                        with respect to 1 or more of such 
                        contracts or agreements.
                            ``(ii) Notwithstanding clause (i), 
                        such application, order, or decree may 
                        operate as a stay of the foreclosure on 
                        securities collateral pledged by the 
                        debtor, whether or not with respect to 
                        1 or more of such contracts or 
                        agreements, securities sold by the 
                        debtor under a repurchase agreement or 
                        securities lent under a securities 
                        lending agreement.
                            ``(iii) As used in this section, 
                        the term `contractual right' includes a 
                        right set forth in a rule or bylaw of a 
                        national securities exchange, a 
                        national securities association, or a 
                        securities clearing agency, a right set 
                        forth in a bylaw of a clearing 
                        organization or contract market or in a 
                        resolution of the governing board 
                        thereof, and a right, whether or not in 
                        writing, arisingunder common law, under 
law merchant, or by reason of normal business practice.''.

SEC. 1012. ASSET-BACKED SECURITIZATIONS.

    Section 541 of title 11, United States Code, is amended--
            (1) in subsection (b), by striking ``or'' at the 
        end of paragraph (4);
            (2) by redesignating paragraph (5) of subsection 
        (b) as paragraph (6);
            (3) by inserting after paragraph (4) of subsection 
        (b) the following new paragraph:
            ``(5) any eligible asset (or proceeds thereof), to 
        the extent that such eligible asset was transferred by 
        the debtor, before the date of commencement of the 
        case, to an eligible entity in connection with an 
        asset-backed securitization, except to the extent such 
        asset (or proceeds or value thereof) may be recovered 
        by the trustee under section 550 by virtue of avoidance 
        under section 548(a); or''; and
            (4) by adding at the end the following new 
        subsection:
    ``(e) Definitions.--For purposes of this section, the 
following definitions shall apply:
            ``(1) Asset-backed securitization.--The term 
        `asset-backed securitization' means a transaction in 
        which eligible assets transferred to an eligible entity 
        are used as the source of payment on securities, the 
        most senior of which are rated investment grade by 1 or 
        more nationally recognized securities rating 
        organizations, issued by an issuer;
            ``(2) Eligible asset.--The term `eligible asset' 
        means--
                    ``(A) financial assets (including interests 
                therein and proceeds thereof), either fixed or 
                revolving, including residential and commercial 
                mortgage loans, consumer receivables, trade 
                receivables, and lease receivables, that, by 
                their terms, convert into cash within a finite 
                time period, plus any rights or other assets 
                designed to assure the servicing or timely 
                distribution of proceeds to security holders;
                    ``(B) cash; and
                    ``(C) securities.
            ``(3) Eligible entity.--The term `eligible entity' 
        means--
                    ``(A) an issuer; or
                    ``(B) a trust, corporation, partnership, or 
                other entity engaged exclusively in the 
                business of acquiring and transferring eligible 
                assets directly or indirectly to an issuer and 
                taking actions ancillary thereto;
            ``(4) Issuer.--The term `issuer' means a trust, 
        corporation, partnership, or other entity engaged 
        exclusively in the business of acquiring and holding 
        eligible assets, issuing securities backed by eligible 
        assets, and taking actions ancillary thereto.
            ``(5) Transferred.--The term `transferred' means 
        the debtor, pursuant to a written agreement, 
        represented and warranted that eligible assets were 
        sold, contributed, or otherwise conveyed with the 
        intention of removing them from the estate of the 
        debtor pursuant to subsection (b)(5), irrespective, 
        without limitation of--
                    ``(A) whether the debtor directly or 
                indirectly obtained or held an interest in the 
                issuer or in any securities issued by the 
                issuer;
                    ``(B) whether the debtor had an obligation 
                to repurchase or to service or supervise the 
                servicing of all or any portion of such 
                eligible assets; or
                    ``(C) the characterization of such sale, 
                contribution, or other conveyance for tax, 
                accounting, regulatory reporting, or other 
                purposes.''.

SEC. 1013. FEDERAL RESERVE COLLATERAL REQUIREMENTS.

    The 2d sentence of the 2d undesignated paragraph of section 
16 of the Federal Reserve Act (12 U.S.C. 412) is amended by 
striking ``acceptances acquired under section 13 of this Act'' 
and inserting ``acceptances acquired under section 10A, 10B, 
13, or 13A of this Act''.

SEC. 1014. SEVERABILITY; EFFECTIVE DATE; APPLICATION OF AMENDMENTS.

    (a) Severability.--If any provision of this Act or any 
amendment made by this Act, or the application of any such 
provision or amendment to any person or circumstance, is held 
to be unconstitutional, the remaining provisions of and 
amendments made by this Act and the application of such other 
provisions and amendments to any person or circumstance shall 
not be affected thereby.
    (b) Effective Date.--This Act shall take effect on the date 
of the enactment of this Act.
    (c) Application of Amendments.--The amendments made by this 
Act shall apply with respect to cases commenced or appointments 
made under any Federal or State law after the date of enactment 
of this Act, but shall not apply with respect to cases 
commenced or appointments made under any Federal or State law 
before the date of enactment of this Act.

                    TITLE XI--TECHNICAL CORRECTIONS

SEC. 1101. DEFINITIONS.

    Section 101 of title 11, United States Code, as amended by 
section 317, is amended--
            (1) by striking ``In this title--'' and inserting 
        ``In this title:'';
            (2) in each paragraph, by inserting ``The term'' 
        after the paragraph designation;
            (3) in paragraph (35)(B), by striking ``paragraphs 
        (21B) and (33)(A)'' and inserting ``paragraphs (23) and 
        (35)'';
            (4) in each of paragraphs (35A) and (38), by 
        striking ``; and'' at the end and inserting a period;
            (5) in paragraph (51B)--
                    (A) by inserting ``who is not a family 
                farmer'' after ``debtor'' the first place it 
                appears; and
                    (B) by striking ``thereto having 
                aggregate'' and all that follows through the 
                end of the paragraph;
            (6) by amending paragraph (54) to read as follows:
            ``(54) The term `transfer' means--
                    ``(A) the creation of a lien;
                    ``(B) the retention of title as a security 
                interest;
                    ``(C) the foreclosure of a debtor's equity 
                of redemption; or
                    ``(D) each mode, direct or indirect, 
                absolute or conditional, voluntary or 
                involuntary, of disposing of or parting with--
                            ``(i) property; or
                            ``(ii) an interest in property;'';
            (7) in each of paragraphs (1) through (35), in each 
        of paragraphs (36) and (37), and in each of paragraphs 
        (40) through (55) (including paragraph (54), as amended 
        by paragraph (6) of this section), by striking the 
        semicolon at the end and inserting a period; and
            (8) by redesignating paragraphs (4) through (55), 
        including paragraph (54), as amended by paragraph (6) 
        of this section, in entirely numerical sequence.

SEC. 1102. ADJUSTMENT OF DOLLAR AMOUNTS.

    Section 104 of title 11, United States Code, is amended by 
inserting ``522(f)(3), 707(b)(5),'' after ``522(d),'' each 
place it appears.

SEC. 1103. EXTENSION OF TIME.

    Section 108(c)(2) of title 11, United States Code, is 
amended by striking ``922'' and all that follows through 
``or'', and inserting ``922, 1201, or''.

SEC. 1104. TECHNICAL AMENDMENTS.

    Title 11 of the United States Code is amended--
            (1) in section 109(b)(2) by striking ``subsection 
        (c) or (d) of'';
            (2) in section 541(b)(4) by adding ``or'' at the 
        end; and
            (3) in section 552(b)(1) by striking ``product'' 
        each place it appears and inserting ``products''.

SEC. 1105. PENALTY FOR PERSONS WHO NEGLIGENTLY OR FRAUDULENTLY PREPARE 
                    BANKRUPTCY PETITIONS.

    Section 110(j)(3) of title 11, United States Code, is 
amended by striking ``attorney's'' and inserting ``attorneys' 
''.

SEC. 1106. LIMITATION ON COMPENSATION OF PROFESSIONAL PERSONS.

    Section 328(a) of title 11, United States Code, is amended 
by inserting ``on a fixed or percentage fee basis,'' after 
``hourly basis,''.

SEC. 1107. SPECIAL TAX PROVISIONS.

    Section 346(g)(1)(C) of title 11, United States Code, is 
amended by striking ``, except'' and all that follows through 
``1986''.

SEC. 1108. EFFECT OF CONVERSION.

    Section 348(f)(2) of title 11, United States Code, is 
amended by inserting ``of the estate'' after ``property'' the 
first place it appears.

SEC. 1109. AMENDMENT TO TABLE OF SECTIONS.

    The table of sections for chapter 5 of title 11, United 
States Code, is amended by striking the item relating to 
section 556 and inserting the following:

``556. Contractual right to liquidate a commodities contract or forward 
          contract.''.

SEC. 1110. ALLOWANCE OF ADMINISTRATIVE EXPENSES.

    Section 503(b)(4) of title 11, United States Code, is 
amended by inserting ``subparagraph (A), (B), (C), (D), or (E) 
of'' before ``paragraph (3)''.

SEC. 1111. PRIORITIES.

    Section 507(a) of title 11, United States Code, as amended 
by section 323, is amended--
            (1) in paragraph (3)(B), by striking the semicolon 
        at the end and inserting a period; and
            (2) in paragraph (7), by inserting ``unsecured'' 
        after ``allowed''.

SEC. 1112. EXEMPTIONS.

    Section 522 of title 11, United States Code, as amended by 
section 320, is amended--
            (1) in subsection (f)(1)(A)(ii)(II)--
                    (A) by striking ``includes a liability 
                designated as'' and inserting ``is for a 
                liability that is designated as, and is 
                actually in the nature of,''; and
                    (B) by striking ``, unless'' and all that 
                follows through ``support''; and
            (2) in subsection (g)(2), by striking ``subsection 
        (f)(2)'' and inserting ``subsection (f)(1)(B)''.

SEC. 1113. EXCEPTIONS TO DISCHARGE.

    Section 523 of title 11, United States Code, is amended--
            (1) in subsection (a)(3), by striking ``or (6)'' 
        each place it appears and inserting ``(6), or (15)'';
            (2) as amended by section 304(e) of Public Law 103-
        394 (108 Stat. 4133), in paragraph (15), by 
        transferring such paragraph so as to insert it after 
        paragraph (14) of subsection (a);
            (3) in subsection (a)(9), by inserting ``, 
        watercraft, or aircraft'' after ``motor vehicle'';
            (4) in subsection (a)(15), as so redesignated by 
        paragraph (2) of this subsection, by inserting ``to a 
        spouse, former spouse, or child of the debtor and'' 
        after ``(15)'';
            (5) in subsection (a)(17)--
                    (A) by striking ``by a court'' and 
                inserting ``on a prisoner by any court'';
                    (B) by striking ``section 1915 (b) or (f)'' 
                and inserting ``subsection (b) or (f)(2) of 
                section 1915''; and
                    (C) by inserting ``(or a similar non-
                Federal law)'' after ``title 28'' each place it 
                appears; and
            (6) in subsection (e), by striking ``a insured'' 
        and inserting ``an insured''.

SEC. 1114. EFFECT OF DISCHARGE.

    Section 524(a)(3) of title 11, United States Code, is 
amended by striking ``section 523'' and all that follows 
through ``or that'' and inserting ``section 523, 1228(a)(1), or 
1328(a)(1) of this title, or that''.

SEC. 1115. PROTECTION AGAINST DISCRIMINATORY TREATMENT.

    Section 525(c) of title 11, United States Code, is 
amended--
            (1) in paragraph (1), by inserting ``student'' 
        before ``grant'' the second place it appears; and
            (2) in paragraph (2), by striking ``the program 
        operated under part B, D, or E of'' and inserting ``any 
        program operated under''.

SEC. 1116. PROPERTY OF THE ESTATE.

    Section 541(b)(4)(B)(ii) of title 11, United States Code, 
is amended by inserting ``365 or'' before ``542''.

SEC. 1117. PREFERENCES.

    Section 547 of title 11, United States Code, is amended--
            (1) in subsection (b), by striking ``subsection 
        (c)'' and inserting ``subsections (c) and (h)''; and
            (2) by adding at the end the following:
    ``(h) If the trustee avoids under subsection (b) a security 
interest given between 90 days and 1 year before the date of 
the filing of the petition, by the debtor to an entity that is 
not an insider for the benefit of a creditor that is an 
insider, such security interest shall be considered to be 
avoided under this section only with respect to the creditor 
that is an insider.''.

SEC. 1118. POSTPETITION TRANSACTIONS.

    Section 549(c) of title 11, United States Code, is 
amended--
            (1) by inserting ``an interest in'' after 
        ``transfer of'';
            (2) by striking ``such property'' and inserting 
        ``such real property''; and
            (3) by striking ``the interest'' and inserting 
        ``such interest''.

SEC. 1119. DISPOSITION OF PROPERTY OF THE ESTATE.

    Section 726(b) of title 11, United States Code, is amended 
by striking ``1009,''.

SEC. 1120. GENERAL PROVISIONS.

    Section 901(a) of title 11, United States Code, as amended 
by section 408, is amended by inserting ``1123(d),'' after 
``1123(b),''.

SEC. 1121. APPOINTMENT OF ELECTED TRUSTEE.

    Section 1104(b) of title 11, United States Code, is 
amended--
            (1) by inserting ``(1)'' after ``(b)''; and
            (2) by adding at the end the following:
    ``(2)(A) If an eligible, disinterested trustee is elected 
at a meeting of creditors under paragraph (1), the United 
States trustee shall file a report certifying that election. 
Upon the filing of a report under the preceding sentence--
            ``(i) the trustee elected under paragraph (1) shall 
        be considered to have been selected and appointed for 
        purposes of this section; and
            ``(ii) the service of any trustee appointed under 
        subsection (d) shall terminate.
    ``(B) In the case of any dispute arising out of an election 
under subparagraph (A), the court shall resolve the dispute.''.

SEC. 1122. ABANDONMENT OF RAILROAD LINE.

    Section 1170(e)(1) of title 11, United States Code, is 
amended by striking ``section 11347'' and inserting ``section 
11326(a)''.

SEC. 1123. CONTENTS OF PLAN.

    Section 1172(c)(1) of title 11, United States Code, is 
amended by striking ``section 11347'' and inserting ``section 
11326(a)''.

SEC. 1124. DISCHARGE UNDER CHAPTER 12.

    Subsections (a) and (c) of section 1228 of title 11, United 
States Code, are amended by striking ``1222(b)(10)'' each place 
it appears and inserting ``1222(b)(9)''.

SEC. 1125. BANKRUPTCY CASES AND PROCEEDINGS.

    Section 1334(d) of title 28, United States Code, is 
amended--
            (1) by striking ``made under this subsection'' and 
        inserting ``made under subsection (c)''; and
            (2) by striking ``This subsection'' and inserting 
        ``Subsection (c) and this subsection''.

SEC. 1126. KNOWING DISREGARD OF BANKRUPTCY LAW OR RULE.

    Section 156(a) of title 18, United States Code, is 
amended--
            (1) in the first undesignated paragraph--
                    (A) by inserting ``(1) the term'' before `` 
                `bankruptcy''; and
                    (B) by striking the period at the end and 
                inserting ``; and''; and
            (2) in the second undesignated paragraph--
                    (A) by inserting ``(2) the term'' before `` 
                `document''; and
                    (B) by striking ``this title'' and 
                inserting ``title 11''.

SEC. 1127. TRANSFERS MADE BY NONPROFIT CHARITABLE CORPORATIONS.

    (a) Sale of Property of Estate.--Section 363(d) of title 
11, United States Code, is amended--
            (1) by striking ``only'' and all that follows 
        through the end of the subsection and inserting 
        ``only--
            ``(1) in accordance with applicable nonbankruptcy 
        law that governs the transfer of property by a 
        corporation or trust that is not a moneyed, business, 
        or commercial corporation or trust; and
            ``(2) to the extent not inconsistent with any 
        relief granted under subsection (c), (d), (e), or (f) 
        of section 362 of this title.''.
    (b) Confirmation of Plan for Reorganization.--Section 
1129(a) of title 11, United States Code, as amended by section 
143, is amended by adding at the end the following:
            ``(15) All transfers of property of the plan shall 
        be made in accordance with any applicable provisions of 
        nonbankruptcy law that govern the transfer of property 
        by a corporation or trust that is not a moneyed, 
        business, or commercial corporation or trust.''.
    (c) Transfer of Property.--Section 541 of title 11, United 
States Code, is amended by adding at the end the following:
    ``(e) Notwithstanding any other provision of this title, 
property that is held by a debtor that is a corporation 
described in section 501(c)(3) of the Internal Revenue Code of 
1986 and exempt from tax under section 501(a) of such Code may 
be transferred to an entity that is not such a corporation, but 
only under the same conditions as would apply if the debtor had 
not filed a case under this title.''.
    (d) Applicability.--The amendments made by this section 
shall apply to a case pending under title 11, United States 
Code, on the date of enactment of this Act, except that the 
court shall not confirm a plan under chapter 11 of this title 
without considering whether this section would substantially 
affect the rights of a party in interest who first acquired 
rights with respect to the debtor after the date of the 
petition. The parties who may appear and be heard in a 
proceeding under this section include the attorney general of 
the State in which the debtor is incorporated, was formed, or 
does business.
    (e) Rule of Construction.--Nothing in this section shall be 
deemed to require the court in which a case under chapter 11 is 
pending to remand or refer any proceeding, issue, or 
controversy to any other court or to require the approval of 
any other court for the transfer of property.

SEC. 1128. PROHIBITION ON CERTAIN ACTIONS FOR FAILURE TO INCUR FINANCE 
                    CHARGES.

    Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is 
amended by adding at the end the following:
    ``(h) Prohibition on Certain Actions for Failure To Incur 
Finance Charges.--A creditor of an account under an open end 
consumer credit plan may not terminate an account prior to its 
expiration date solely because the consumer has not incurred 
finance charges on the account. Nothing in this subsection 
shall prohibit a creditor from terminating an account for 
inactivity in 3 or more consecutive months.''.

SEC. 1129. PROTECTION OF VALID PURCHASE MONEY SECURITY INTERESTS.

    Section 547(c)(3)(B) of title 11, United States Code, is 
amended by striking ``20'' and inserting ``30''.

SEC. 1130. TRUSTEES.

    (a) Suspension and Termination of Panel Trustees and 
Standing Trustees.--Section 586(d) of title 28, United States 
Code, is amended--
            (1) by inserting ``(1)'' after ``(d)''; and
            (2) by adding at the end the following:
    ``(2) A trustee whose appointment under subsection (a)(1) 
or under subsection (b) is terminated or who ceases to be 
assigned to cases filed under title 11 of the United States 
Code may obtain judicial review of the final agency decision by 
commencing an action in the United States district court for 
the district for which the panel to which the trustee is 
appointed under subsection (a)(1), or in the United States 
district court for the district in which the trustee is 
appointed under subsection (b) resides, after first exhausting 
all available administrative remedies, which if the trustee so 
elects, shall also include an administrative hearing on the 
record. Unless the trustee elects to have an administrative 
hearing on the record, the trustee shall be deemed to have 
exhausted all administrative remedies for purposes of this 
paragraph if the agency fails to make a final agency decision 
within 90 days after the trustee requests administrative 
remedies. The Attorney General shall prescribe procedures to 
implement this paragraph. The decision of the agency shall be 
affirmed by the district court unless it is unreasonable and 
without cause based on the administrative record before the 
agency.''.
    (b) Expenses of Standing Trustees.--Section 586(e) of title 
28, United States Code, is amended by adding at the end the 
following:
    ``(3) After first exhausting all available administrative 
remedies, an individual appointed under subsection (b) may 
obtain judicial review of final agency action to deny a claim 
of actual, necessary expenses under this subsection by 
commencing an action in the United States district court in the 
district where the individual resides. The decision of the 
agency shall be affirmed by the district court unless it is 
unreasonable or without cause based upon the administrative 
record before the agency.
    ``(4) The Attorney General shall prescribe procedures to 
implement this subsection.''.

      TITLE XII--GENERAL EFFECTIVE DATE; APPLICATION OF AMENDMENTS

SEC. 1201. EFFECTIVE DATE; APPLICATION OF AMENDMENTS.

    (a) Effective Date.--Except as provided otherwise in this 
Act, this Act and the amendments made by this Act shall take 
effect 180 days after the date of the enactment of this Act.
    (b) Application of Amendments.--The amendments made by this 
Act shall not apply with respect to cases commenced under title 
11 of the United States Code before the effective date of this 
Act.
      And the Senate agree to the same.

                From the Committee on the Judiciary, for 
                consideration of the House bill and the Senate 
                amendment, and modifications committed to 
                conference:
                                   Henry Hyde,
                                   Bill McCollum,
                                   George W. Gekas,
                                   Bob Goodlatte,
                                   Ed Bryant,
                                   Steve Chabot,
                                   Rick Boucher,
                                 Managers on the Part of the House.

                                   Orrin G. Hatch,
                                   Chuck Grassley,
                                   Jeff Sessions,
                                Managers on the Part of the Senate.

       JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE

      The managers on the part of the House and the Senate at 
the Conference on the disagreeing votes of the two Houses on 
the amendment of the Senate to the bill (H.R. 3150), to amend 
title 11 of the United States Code, and for other purposes, 
submit the following joint statement to the House and Senate in 
explanation of the effect of the action agreed upon by the 
managers and recommended in the accompanying conference report:
      Differences between the House and Senate bills on several 
primary issues were the focus of discussions at the Conference.

                             means testing

      The House version contained a pre-filing formula to steer 
debtors with repayment capacity into Chapter 13 repayment 
plans. The Senate bill directed bankruptcy judges to consider 
the repayment capacity of debtors who had filed in Chapter 7 
bankruptcy to determine whether they were appropriately filed. 
The compromise combines the best aspects of both approaches. It 
adopts the procedural approach of the Senate bill directing 
bankruptcy judges to consider repayment capacity, while 
instructing that such repayment capacity shall be presumed by 
the judge if the individual meets certain bright-line standards 
for measuring such repayment capacity. This approach preserves 
the right of a debtor in bankruptcy to have a judge review his 
or her individual case so that the debtor's unique 
circumstances could be taken into account.

                          non-dischargeability

      The House bill contained a provision that any debts 
incurred within 90 days of declaring bankruptcy, other than 
reasonably necessary living expenses not exceeding $250, were 
presumed to be nondischargeable. The House bill capped 
necessary living expenses at $250. The Senate bill contained a 
provision that debts other than reasonably necessary living 
expenses incurred within 90 days of declaring bankruptcy were 
presumed non-dischargeable. The Senate bill exempted all 
expenses, whether reasonable or not, up to $400. The Conferees 
reached a compromise between these provisions that new debts 
incurred within 90 days of bankruptcy for luxury goods over 
$250 in value would be presumed non-dischargeable. The 
compromise provides no limitation for reasonably necessary 
living expenses.
      In addition, the House bill contained a provision that 
any debt incurred to pay non-dischargeable debt is also non-
dischargeable. Under the Senate bill, debts incurred to pay 
non-dischargeable debts were only non-dischargeable if the 
debtor intended to discharge the newly created debt in 
bankruptcy. Under the Committee compromise, only debts incurred 
within 90 days prior to filing for bankruptcy to pay non-
dischargeable debts are non-dischargeable, however, debts 
incurred prior to 90 days prior to filing for bankruptcy to pay 
nondischargeable debts are nondischargeable only if the debtor 
intended to discharge the newly created debt in bankruptcy.

              ENHANCED DISCLOSURES AND CREDITOR PENALTIES

      The House bill contained disclosure requirements for 
debtor lawyers who advertise debt relief services to ensure 
that unwary consumers were not lured into bankruptcy without 
being fully aware of their alternatives. The Senate bill 
contained provisions which required certain lenders to make 
disclosures, regarding minimum monthly payments, total costs, 
among others. The House bill contained no such provisions on 
enhanced consumer disclosures for credit extensions. The 
Conferees agreed to retain the disclosure provisions for debtor 
attorneys and to direct the Board of Governors of the Federal 
Reserve to develop appropriate and meaningful additional 
disclosure requirements for the use of consumers. In addition, 
several of the Senate bill provisions which assessed stiff 
fines on creditors who used abusive collection techniques, were 
adopted in the final Conference Report. The Conference Report 
also specifies that the new penalties will not give rise to 
class action liability.

                             REAFFIRMATIONS

      The House bill contained no comparable provision to the 
Senate bill, which imposed a requirement for a hearing before a 
judge for certain types of reaffirmations by debtors. The 
Conference Committee streamlined these judicial procedures by 
ensuring that every debtor who reaffirms unsecured debt has the 
opportunity to appear before a judge. Under the compromise an 
enhanced standard is provided for the review of certain 
reaffirmation agreements. The judge is now required to 
determine that the reaffirmation was in the best interest of 
the debtor, would not impose an undue hardship, and was not the 
result of coercion.

                               CRAMDOWNS

      The House bill prohibited cramdowns for certain secured 
debts incurred within 180 days prior to bankruptcy. The Senate 
bill contained an absolute prohibition on cramdowns in Chapter 
13 cases. The Committee compromised by prohibiting cramdowns on 
debts securing personal property incurred within five years of 
filing for bankruptcy.

                          HOMESTEAD EXEMPTION

      The House version of the homestead exemption required a 
one-year residency prior to being able to claim the homestead 
exemption. The Senate versions capped all homestead exemptions 
at $100,000. The Committee compromise imposes a two-year 
residency requirement before a debtor can claim the homestead 
exemption available in a particular state.
      Other differences between the bills that were resolved by 
the Committee of Conference are apparent from a comparison of 
the two bills.

                        CURBING ABUSIVE FILINGS

    The conferees have added a new paragraph to section 707(b) 
to make clear that, among the considerations in applying the 
``totality of the circumstances'' test for ``abuse'' is whether 
an individual debtor seeks to reject a personal services 
contract and the financial need for such rejection as sought by 
the debtor. This is intended to remedy problems brought to the 
attention of Congress involving bankruptcy filings that were 
motivated in material part in order to reject executory 
contracts for personal services so that the debtor could 
negotiate a new and better contract with a different company. 
This problem was initially addressed in Section 212 of H.R. 
3150, and the solution contained in that provision was targeted 
at this particular form of abuse of the bankruptcy process. 
With the new standard for ``abuse'' in Section 707(b)(2)(C), 
the conferees have determined that the specific provisions of 
Section 212 are no longer necessary, as the bankruptcy court 
will not have the authority to identify and remedy such abuses. 
The conferees intend that, under the ``totality of the 
circumstances'' test, an ``abuse'' of Chapter 7 exists when 
rejection of the personal services contract was a material 
reason for commencing the bankruptcy case, and economic 
rehabilitation of the debtor's finances can be achieved absent 
rejection of the contract. The conferees also intend that 
application of the existing judicially-determined ``bad faith'' 
standard now be used in these circumstances in Chapter 7 cases 
and in Chapter 11 and Chapter 13 cases, in which the debtor or 
debtors are parties to a single personal services contract.

                From the Committee on the Judiciary, for 
                consideration of the House bill and the Senate 
                amendment, and modifications committed to 
                conference:
                                   Henry Hyde,
                                   Bill McCollum,
                                   George W. Gekas,
                                   Bob Goodlatte,
                                   Ed Bryant,
                                   Steve Chabot,
                                   Rick Boucher,
                                 Managers on the Part of the House.

                                   Orrin G. Hatch,
                                   Chuck Grassley,
                                   Jeff Sessions,
                                Managers on the Part of the Senate.

                                
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