[Federal Register Volume 77, Number 91 (Thursday, May 10, 2012)]
[Notices]
[Pages 27456-27457]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-11326]
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DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
FEDERAL RESERVE SYSTEM
FEDERAL DEPOSIT INSURANCE CORPORATION
Guidance on the Effective Date of Section 716 of the Dodd-Frank
Wall Street Reform and Consumer Protection Act
AGENCY: Office of the Comptroller of the Currency (OCC), Treasury;
Board of Governors of the Federal Reserve System (Board); and Federal
Deposit Insurance Corporation (FDIC).
ACTION: Notice of joint guidance.
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SUMMARY: The Office of the Comptroller of the Currency (``OCC''), Board
of Governors of the Federal Reserve System (``Board''), and the Federal
Deposit Insurance Corporation (``FDIC'') are issuing this guidance to
provide clarity regarding the effective date of section 716 of the
Dodd-Frank Wall Street Reform and Consumer Protection Act (``Dodd-Frank
Act'') \1\ with respect to entities for which each is the prudential
regulator.
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\1\ Section 716 of Public Law 111-203, 124 Stat. 1376; 15 U.S.C.
8305.
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DATES: May 10, 2012.
FOR FURTHER INFORMATION CONTACT:
OCC: Ellen Broadman, Director, Securities and Corporate Practices
Division (202) 874-5210, Ted Dowd, Assistant Director, Securities &
Corporate Practices Division (202) 874-5327, or Jamey Basham, Assistant
Director, Legislative and Regulatory Activities Division (202) 874-
5090, Office of the Comptroller of the Currency, 250 E Street SW.,
Washington, DC 20219.
Board: Christine Graham, Senior Attorney (202) 452-3005, or Christopher
Paridon, Counsel (202) 452-3274, Legal Division; Board of Governors of
the Federal Reserve System, 20th and C Streets NW., Washington, DC
20551. For the deaf, hard of hearing, and speech impaired only,
teletypewriter (TTY), (202) 263-4869.
FDIC: Thomas Hearn, Counsel (202) 898-6967, or Mark Flanigan, Counsel
(202) 898-7426, Legal Division; Federal Deposit Insurance Corporation,
550 17th Street NW., Washington, DC 20429. For the hearing impaired
only, telecommunications device for the deaf TDD: 800-925-4618.
SUPPLEMENTARY INFORMATION:
Background
Section 716 prohibits the provision of Federal assistance to any
entity defined under that section to be a swaps entity with respect to
any swap, security-based swap, or other activity of the swaps
entity.\2\ ``Federal assistance'' is defined for purposes of section
716 as ``the use of any advances from any Federal Reserve credit
facility or discount window that is not part of a program with broad-
based eligibility under section 13(3)(A) of the Federal Reserve Act,''
and ``[FDIC] insurance or guarantees'' for certain purposes specified
in section 716(b)(1).\3\
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\2\ See, section 716(a) of the Dodd-Frank Act; 15 U.S.C.
8305(a).
\3\ See, section 716(b)(1) of the Dodd-Frank Act; 15 U.S.C.
8305(b)(1).
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The prudential regulator (as defined in the Commodity Exchange Act)
\4\ of a swaps entity is authorized to prescribe rules implementing
section 716 with respect to that swaps entity.\5\ The Board is the
prudential regulator for state member banks, bank holding companies,
savings and loan holding companies, state branches and agencies of
foreign banks, and certain other swaps entities.\6\ In addition, the
Board is charged with responsibility for establishing and overseeing
the provision of credit through any Federal Reserve credit facility and
the discount window. The FDIC is the prudential regulator for state
nonmember banks and state savings associations.\7\ In addition, the
FDIC is charged with insuring the deposits of banks and savings
associations and managing the Deposit Insurance Fund. The OCC is the
prudential regulator for national banks, federal savings associations,
and Federal branches and agencies of foreign banks.\8\
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\4\ Pursuant to section 711 of the Dodd-Frank Act, the term
``prudential regulator'' as used in section 716 has the same meaning
as in the Commodity Exchange Act. 15 U.S.C. 8301.
\5\ Section 716(k) of the Dodd-Frank Act; 15 U.S.C. 8305(k).
\6\ See 7 U.S.C. 1a(39)(A).
\7\ See id. at section 1a(39)(C).
\8\ See id. at section 1a(39)(B).
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Effective Date
Section 716(h) provides that its general prohibition on Federal
assistance is ``effective 2 years following the date on which this Act
is effective.'' \9\ Section 716 is contained in Title VII of the Dodd-
Frank Act. Section 701 in Title VII provides that Title VII may be
cited as the ``Wall Street Transparency and Accountability Act of
2010.'' \10\ Thus, while enacted within the Dodd-Frank Act, Title VII
is itself ``an Act,'' and references within Title VII to ``this Act''
should be, in context, interpreted as references to the Wall Street
Transparency and Accountability Act of 2010, not to the broader Dodd-
Frank Act. This interpretation is supported by the fact that section
716(m) refers specifically to the Dodd-Frank Act by name--a reference
that would not be necessary if the reference to ``this Act'' in section
716(h) and other provisions of the Wall Street Transparency and
Accountability Act were intended to refer to the Dodd-Frank Act.
Nothing in the context of subsection (m) or other provisions of
[[Page 27457]]
section 716 suggest a different reading was intended.\11\
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\9\ See section 716(h) of the Dodd-Frank Act; 15 U.S.C. 8305(h).
\10\ See section 701 of the Dodd-Frank Act; 15 U.S.C. 8301 note.
\11\ Section 716(m) of the Dodd-Frank Act; 15 U.S.C. 8305(m).
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In general, the Wall Street Transparency and Accountability Act
became effective on July 16, 2011, which is later than the effective
date of the Dodd-Frank Act generally. The Wall Street Transparency and
Accountability Act has two subtitles. Both subtitles contain provisions
that establish an effective date that is 360 days after the enactment
of the subtitle (unless otherwise noted in that subtitle).\12\ The date
of enactment was July 21, 2010, making the effective date of the
subtitles comprising the Wall Street Transparency and Accountability
Act July 16, 2011. Because section 716 specifically adopts an effective
date that is 2 years following the effective date of the Wall Street
Transparency and Accountability Act, section 716 will become effective
on July 16, 2013.\13\
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\12\ Section 754 sets forth the effective date of subtitle A of
Title VII, and section 774 sets forth the effective date of subtitle
B of Title VII. See 7 U.S.C. 7a note and 15 U.S.C. 77b note.
\13\ The agencies intend to invite comment on a separate
proposal that would establish the appropriate transition period for
insured depository institutions pursuant to section 716(f).
Thomas J. Curry,
Comptroller of the Currency.
By order of the Board of Governors of the Federal Reserve
System, April 10, 2012.
Jennifer J. Johnson,
Secretary of the Board.
Federal Deposit Insurance Corporation.
Dated at Washington, DC, this 10th day of April 2012.
Robert E. Feldman,
Executive Secretary.
[FR Doc. 2012-11326 Filed 5-9-12; 8:45 am]
BILLING CODE 4810-33-P; 6210-01-P; 6714-01-P