[Federal Register Volume 66, Number 153 (Wednesday, August 8, 2001)]
[Rules and Regulations]
[Pages 41439-41440]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-19811]


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FEDERAL RESERVE SYSTEM

12 CFR Parts 202, 205, 213, 226, and 230

[Regulations B, E, M, Z, and DD; Docket Nos. R-1040, R-1041, R-1042, R-
1043, and R-1044]


Equal Credit Opportunity; Electronic Fund Transfers; Consumer 
Leasing; Truth in Lending; Truth in Savings

AGENCY: Board of Governors of the Federal Reserve System.

ACTION: Interim final rules; lifting mandatory compliance date.

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SUMMARY: On March 30, and April 4, 2001, the Board published interim 
final rules to establish uniform standards for using electronic 
communication to deliver disclosures required under five

[[Page 41440]]

consumer protection regulations: B (Equal Credit Opportunity), E 
(Electronic Fund Transfers), M (Consumer Leasing), Z (Truth in 
Lending), and DD (Truth in Savings). The Board established October 1, 
2001 as the mandatory compliance date for the interim final rules. To 
address commenters' concerns, the Board is considering adjustments to 
the rules to provide additional flexibility. Therefore, the Board is 
lifting the mandatory compliance date for the interim rules. Once 
permanent final rules are issued, the Board expects to afford 
institutions a reasonable period of time to comply with those rules.

DATES: The October 1, 2001, mandatory compliance date for the interim 
final rules published at 66 FR 17322 and 17329 (March 30, 2001) and at 
66 FR 17779, 17786 and 17795 (April 4, 2001) is lifted.

FOR FURTHER INFORMATION CONTACT: David A. Stein or Ky Tran-Trong, 
Attorneys; Division of Consumer and Community Affairs, at (202) 452-
2412 or (202) 452-3667.

SUPPLEMENTARY INFORMATION:

I. Lifting the Mandatory Compliance Date for the Interim Rules

    Financial institutions and others covered by the Board's consumer 
disclosure rules are currently permitted to provide electronic 
disclosures if they obtain consumers' consent consistent with the 
requirements of the federal Electronic Signatures in Global and 
National Commerce Act (the E-Sign Act), which became effective on 
October 1, 2000. On March 30 and April 4, 2001, the Board published 
interim final rules to provide guidance on how the E-Sign Act applies 
to the consumer financial services and fair lending laws and 
regulations administered by the Board. The Board established October 1, 
2001 as the date for mandatory compliance with the interim final rules. 
See 66 FR 17779 (Regulation B, Equal Credit Opportunity); 66 FR 17786 
(Regulation E, Electronic Fund Transfers); 66 FR 17322 (Regulation M, 
Consumer Leasing); 66 FR 17329 (Regulation Z, Truth in Lending); 66 FR 
17795 (Regulation DD, Truth in Savings).
    The interim rules give guidance on the timing and delivery of 
electronic disclosures. Disclosures can be provided by e-mail or can be 
made available at another location such as an institution's web site. 
If a disclosure--such as an account statement or a notice of a change 
in account terms--is provided at a web site, an institution must notify 
the consumer of the disclosure's availability by e-mail. In addition, 
the disclosure must remain available on the web site for 90 days.
    A number of commenters on the interim final rules noted that there 
are operational issues raised by the interim rules' requirement that 
institutions alert consumers by e-mail when electronic disclosures are 
made available at another location, such as a web site. They also noted 
that the October 1, 2001, compliance deadline does not afford them 
adequate time for making the needed changes.
    Some institutions have been offering electronic disclosures for 
several years under Regulations E and DD, based on interim rules issued 
by the Board in 1998 and 1999 respectively. See 63 FR 14528; 64 FR 
49846. Others have been permitted to give electronic disclosures under 
Regulations B, M, and Z since the E-Sign Act took effect last year. 
Many of these institutions have not used e-mail to alert consumers to 
disclosures posted at their web sites.
    Based on the comments, the Board is considering adjustments to the 
rules to provide additional flexibility. Therefore, the Board is 
lifting the mandatory compliance date for the interim rules. 
Institutions may continue to provide electronic disclosures under their 
existing policies and practices, or may follow the interim rules, until 
the Board issues permanent rules. Once permanent final rules are 
issued, the Board expects to afford institutions a reasonable period of 
time to comply with those rules.

II. Withdrawal of 1998 and 1999 Interim Rules Unaffected

    In 1998 and 1999, the Board adopted interim rules under Regulations 
E and DD respectively, to allow the electronic delivery of certain 
disclosures, if the consumer agrees. The 1998 and 1999 interim rules 
did not specify the manner or form of consumer's consent to electronic 
disclosures.
    Effective October 1, 2000, the E-Sign Act permits institutions to 
provide disclosures to consumers using electronic communications, if 
the institution complies with the requirements of section 101(c) of 
that act. The Board's 2001 interim final rules set forth the general 
rule that institutions subject to Regulations E and DD may provide 
disclosures electronically only if the institution complies with 
section 101(c) of the E-Sign Act. Accordingly, the Board's 2001 interim 
rules provided that the 1998 and 1999 interim rules were withdrawn. The 
Board's action lifting the mandatory compliance date for the 2001 
interim rules has no effect on the withdrawal of the 1998 and 1999 
interim rules.

III. Foreign Language Disclosures

    To provide consistency among the regulations, the interim final 
rules also included revisions to Regulations B (Sec. 202.4(b)), E 
(Sec. 205.4(a)(2)), and Z (Sec. 226.27) that permit disclosures in 
languages other than English as long as disclosures in English are also 
available upon request. The Board's action lifting the mandatory 
compliance date for the 2001 interim rules has no effect on these 
provisions.

    By order of the Board of Governors of the Federal Reserve 
System, August 2, 2001.
Jennifer J. Johnson,
Secretary of the Board.
[FR Doc. 01-19811 Filed 8-7-01; 8:45 am]
BILLING CODE 6210-01-P