[Federal Register Volume 65, Number 165 (Thursday, August 24, 2000)]
[Rules and Regulations]
[Pages 51521-51522]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-21424]


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EMERGENCY STEEL GUARANTEE LOAN BOARD

13 CFR Part 400

RIN 3003-ZA00


Emergency Steel Guarantee Loan Program; Participation in 
Unguaranteed Tranche

AGENCY: Emergency Steel Guarantee Loan Board.

ACTION: Final rule.

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SUMMARY: The Emergency Steel Guarantee Loan Board (Board) is amending 
the regulations governing the Emergency Steel Guarantee Loan Program 
(Program). These changes are meant to clarify the regulations 
applicable to certain types of loan participations. The intent of these 
changes is to make explicit the Board's position with respect to 
participations in wholly unguaranteed tranches of loans that are 
guaranteed under the Program.

DATES: This rule is effective August 24, 2000.

FOR FURTHER INFORMATION CONTACT: Marguerite S. Owen, General Counsel, 
Emergency Steel Guarantee Loan Board, U.S. Department of Commerce, Room 
H2500, Washington, D.C. 20230, (202) 219-0584.

SUPPLEMENTARY INFORMATION: On October 27, 1999, the Board published a 
final rule codifying at Chapter IV, Title 13, Code of Federal 
Regulations (CFR), regulations implementing the Program, as established 
in Chapter 1 of Public Law 106-51, the Emergency Steel Loan Guarantee 
Act of 1999 (64 FR 57932).
    Section 400.210 sets forth terms and conditions governing 
assignment or transfer of loans and interests in loans between and 
among eligible lenders. This rule adds a new Sec. 400.214 to make clear 
that certain types of participations in unguaranteed portions of loans 
are not transfers or assignments to a lender under the regulations, 
though a lender can participate in an unguaranteed portion of a loan. 
Further, this rule sets forth the terms and conditions governing 
participation in an unguaranteed tranche of a loan guaranteed under the 
Program. It does so by describing categories of entities that may act 
as participants without Board approval and providing that other 
entitites may act as participants with Board approval. This rule also 
contains a requirement for a minimum percentage of the unguaranteed 
portion of a guaranteed loan that a lender is required to hold without 
participation.
Administrative Law Requirements

Executive Order 12866

    This final rule has been determined not to be significant for 
purposes of Executive Order 12866.

Administrative Procedure Act

    This rule is exempt from the rulemaking requirements contained in 5 
U.S.C. 553 pursuant to authority contained in 5 U.S.C. 553(a)(2) as it 
involves a matter relating to loans. As such, prior notice and an 
opportunity for public comment and a delay in effective date otherwise 
required under 5 U.S.C. 553 are inapplicable to this rule.

Regulatory Flexibility Act

    Because this rule is not subject to a requirement to provide prior 
notice and an opportunity for public comment pursuant to 5 U.S.C. 553, 
or any other law, the analytical requirements of the Regulatory 
Flexibility Act, 5 U.S.C. 601 et seq., are inapplicable.

Congressional Review Act

    This rule has been determined to be not major for purposes of the 
Congressional Review Act, 5 U.S.C. 801 et seq.

Intergovernmental Review

    No intergovernmental consultations with State and local officials 
are required because the rule is not subject to the provisions of 
Executive Order 12372 or Executive Order 12875.

Unfunded Mandates Reform Act of 1995

    This rule contains no Federal mandates, as that term is defined in 
the Unfunded Mandates Reform Act, on State, local and tribal 
governments or the private sector.

Executive Order 13132

    This rule does not contain policies having federalism implications 
requiring preparation of a Federalism Summary Impact Statement.

Executive Order 12630

    This rule does not contain policies that have takings implications.

List of Subjects in 13 CFR Part 400

    Administrative practice and procedure, Loan programs--steel, 
Reporting and recordkeeping requirements.

    Dated: August 14, 2000.
Daniel J. Rooney,
Executive Secretary, Emergency Steel Guarantee Loan Board.

    For the reasons set forth in the preamble, 13 CFR part 400 is 
amended to read as follows:

PART 400--EMERGENCY STEEL GUARANTEE LOAN PROGRAM

    1.The authority citation for part 400 continues to read as follows:

    Authority: Pub. L. 106-51, 113 Stat. 255 (15 U.S.C. 1841 note).

    2. New Sec. 400.214 is added to read as follows:


Sec. 400.214  Participation in unguaranteed tranche of guaranteed loan.

    (a) Subject to paragraphs (b) and (c) of this section, a Lender may 
distribute the risk of a wholly unguaranteed tranche of a loan 
guaranteed under the Program by purchase of participations therein from 
the Lender if:
    (1) Neither the loan note nor the Guarantee is assigned, conveyed, 
sold, or transferred in whole or in part;
    (2) The Lender remains solely responsible for the administration of 
the loan; and
    (3) The Board's ability to assert any and all defenses available to 
it under the Guarantee and the law is not adversely affected.

[[Page 51522]]

    (b) The following categories of entities may purchase 
participations:
    (1) Eligible Lenders;
    (2) Private investment funds and insurance companies that do not 
usually invest in commercial loans;
    (3) Steel company suppliers or customers, who are interested in 
participating in the unguaranteed tranche as a means of commencing or 
solidifying the supplier or customer relationship with the borrower; or
    (4) Any other entity approved by the Board on a case-by-case basis.
    (c) The Agent must maintain and may not grant participations in an 
interest in the unguaranteed portion of the loan, which as a percentage 
of the Agent's overall interest in the loan, is no less than the 
aggregate percentage of the loan which is not guaranteed. Every Lender, 
other than the Agent, must maintain and may not grant participations in 
an interest in the unguaranteed portion of the loan representing no 
less than five percent of such Lender's overall interest in the loan, 
except as otherwise provided in Sec. 400.210(c)(3).

[FR Doc. 00-21424 Filed 8-23-00; 8:45 am]
BILLING CODE 3510-NC-P