[Federal Register Volume 79, Number 103 (Thursday, May 29, 2014)]
[Rules and Regulations]
[Pages 30708-30709]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-12357]


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FEDERAL RESERVE SYSTEM

12 CFR Part 216

[Docket No. R-1483]
RIN 7100 AE13


Privacy of Consumer Information (Regulation P)

AGENCY: Board of Governors of the Federal Reserve System.

ACTION: Final rule.

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SUMMARY: The Board of Governors of the Federal Reserve System (Board) 
is repealing its Regulation P, 12 CFR part 216, which was issued to 
implement the privacy provisions of the Gramm-Leach-Bliley Act (GLB 
Act). Title X of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act (Dodd-Frank Act) transferred rulemaking authority for a 
number of consumer financial protection laws from the Board, and six 
other Federal agencies, to the Bureau of Consumer Financial Protection 
(Bureau), including rulemaking authority for the provisions in Subtitle 
A of Title V of the GLB Act that were implemented in the Board's 
Regulation P. In December 2011, the Bureau published an interim final 
rule establishing its own Regulation P to implement these provisions of 
the GLB Act. The Bureau's Regulation P covers those entities previously 
subject to the Board's Regulation P. Accordingly, the Board is 
repealing its Regulation P.

DATES: The final rule is effective June 30, 2014.

FOR FURTHER INFORMATION CONTACT: Vivian W. Wong, Counsel, Division of 
Consumer and Community Affairs, at (202) 452-3667, Board of Governors 
of the Federal Reserve System, 20th and C Streets NW., Washington, DC 
20551. For users of Telecommunications Device for the Deaf (TDD) only, 
contact (202) 263-4869.

SUPPLEMENTARY INFORMATION:

I. Discussion

    Subtitle A of Title V of the Gramm-Leach-Bliley Act (GLB Act), 15 
U.S.C. 6801-6809, titled ``Disclosure of Nonpublic Personal 
Information,'' limits the circumstances in which a financial 
institution can disclose nonpublic personal information about a 
consumer to nonaffiliated third parties and requires financial 
institutions to provide certain privacy notices to their customers who 
are consumers. Prior to July 21, 2011, rulemaking authority for the 
subtitle was shared by eight Federal agencies, including the Board of 
Governors of the Federal Reserve System (Board).\1\ Each of the 
agencies issued consistent and comparable rules to implement the GLB 
Act's privacy provisions; the Board implemented its rule as Regulation 
P, 12 CFR part 216.
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    \1\ The other Federal agencies included the Federal Deposit 
Insurance Corporation, the Federal Trade Commission, the National 
Credit Union Administration, the Office of the Comptroller of the 
Currency, the Office of Thrift Supervision, the Securities and 
Exchange Commission, and the Commodity Futures Trading Commission.
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    Title X of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act (Dodd-Frank Act) \2\ transferred rulemaking authority 
for a number of consumer financial protection laws, including the 
authority to prescribe regulations under the privacy provisions of the 
GLB Act, to the Bureau of Consumer Financial Protection (Bureau).\3\ 
This transfer of rulemaking authority from the Board and other Federal 
agencies to the Bureau became effective on July 21, 2011. In connection 
with the transfer, the Bureau published an interim final rule to 
establish its own Regulation P, 12 CFR part 1016, to implement the 
privacy provisions of the GLB Act (Bureau Interim Final Rule).\4\ The 
Bureau Interim Final Rule substantially duplicates the Board's 
Regulation P and covers financial institutions and other persons for 
which the Bureau has rulemaking authority pursuant to section 
504(a)(1)(A) of the GLB Act, as amended by the Dodd-Frank Act. The 
Bureau Interim Final Rule does not impose any new substantive 
obligations on regulated entities.
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    \2\ The Dodd-Frank Act, Public Law 111-203, 124 Stat. 1376, was 
signed into law on July 21, 2010.
    \3\ The Dodd-Frank Act did not transfer the Board's authority 
under section 501(b) of the GLB Act to establish information 
security standards for financial institutions subject to its 
jurisdiction. 15 U.S.C. 6801(b). Therefore, the Bureau does not have 
authority to prescribe regulations for GLB Act section 505 as it 
applies to section 501(b).
    \4\ 76 FR 79025 (Dec. 21, 2011).
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    The scope of the Board's Regulation P is set forth in Sec.  
216.1(b)(1) and states that the part applies to state member banks, 
bank holding companies and certain of their nonbank subsidiaries or 
affiliates, state uninsured branches and agencies of foreign banks, 
commercial lending companies owned or controlled by foreign banks, and 
Edge and agreement corporations. As a result, all of the entities 
formerly subject to the Board's rule are covered by the Bureau Interim 
Final Rule.\5\ Consequently, the Board published a proposal in February 
2014 to repeal its Regulation P, 12 CFR part 216 (Proposed Rule).\6\ 
The Board received four comments on the Proposed Rule.
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    \5\ Furthermore, the Board notes that section 1093 of the Dodd-
Frank Act revises the GLB Act to provide that notwithstanding the 
authority of the Bureau to prescribe regulations to implement the 
privacy provisions with respect to financial institutions and other 
persons subject to its jurisdiction, the Federal Trade Commission 
shall have authority to prescribe such regulations with respect to 
any financial institution that is a motor vehicle dealer described 
in section 1029(a) of the Dodd-Frank Act. See 15 U.S.C. 
6804(a)(1)(C).
    \6\ 79 FR 8904 (Feb. 20, 2014).
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    Almost all commenters supported the Board's proposal to repeal its 
Regulation P in order to avoid confusion and duplication. One 
commenter, however, suggested that the regulation be retained in case 
the law changes. Based on the comments the Board received and because 
the Bureau Interim Final Rule covers all of the entities formerly 
subject to the Board's rule, the Board is repealing its Regulation P.

[[Page 30709]]

II. Final Regulatory Flexibility Analysis

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) (RFA) 
generally requires an agency to perform an assessment of the impact a 
rule is expected to have on small entities. Based on its analysis, and 
for the reasons stated below, the Board believes that this final rule 
will not have a significant economic impact on a substantial number of 
small entities.
    1. Statement of the need for, and objectives of, the final rule. 
Title X of the Dodd-Frank Act transferred rulemaking authority for a 
number of consumer financial protection laws from the Board to the 
Bureau, effective July 21, 2011, including the Board's rulemaking 
authority over the privacy provisions of the GLB Act. The Bureau issued 
the Bureau Interim Final Rule to implement the privacy provisions of 
the GLB Act in connection with the transfer of this rulemaking 
authority to the Bureau. All of the entities formerly subject to the 
Board's Regulation P are covered by the Bureau Interim Final Rule. 
Consequently, the Board's repeal of the Board's Regulation P, 12 CFR 
part 216, will not have any effect on entities that were formerly 
subject to the Board's rule.
    2. Summary of issues raised by comments in response to the initial 
regulatory flexibility analysis. The Board did not receive any comments 
on the initial regulatory flexibility analysis.
    3. Small entities affected by the final rule. The final rule 
repeals the Board's Regulation P, 12 CFR part 216, because the Board no 
longer has rulewriting authority for the provisions of the GLB Act that 
were implemented in this regulation. All of the entities previously 
subject to the Board's Regulation P are now subject to the Bureau 
Interim Final Rule. Consequently, the repeal would not affect any 
entity, including any small entity.
    4. Recordkeeping, reporting, and compliance requirements. The final 
rule repeals the Board's Regulation P, 12 CFR part 216, and would 
therefore not impose any recordkeeping, reporting, or compliance 
requirements on any entities. Existing requirements remain the same 
under the Bureau Interim Final Rule.
    5. Significant alternatives to the final revisions. Because the 
repeal of the Board's Regulation P (12 CFR part 216) will have no 
impact, there are no significant alternatives that would further 
minimize the economic impact of the final rule on small entities.

III. Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act (PRA) of 1995 (44 
U.S.C. 3506; 5 CFR part 1320 Appendix A.1), the Board reviewed the rule 
under the authority delegated to the Federal Reserve by the Office of 
Management and Budget. The final rule contains no requirements subject 
to the PRA.

List of Subjects in 12 CFR Part 216

    Banks, banking, Consumer protection, Foreign banking, Holding 
companies, Privacy, Reporting and recordkeeping requirements.

Authority and Issuance

    For the reasons set forth in the preamble, based on the transfer of 
authority under 12 U.S.C. 5581, the Board removes and reserves 
Regulation P, 12 CFR part 216 as follows:

PART 216--[REMOVED AND RESERVED]

    By order of the Board of Governors of the Federal Reserve 
System, May 22, 2014.
Robert deV. Frierson,
Secretary of the Board.
[FR Doc. 2014-12357 Filed 5-28-14; 8:45 am]
BILLING CODE 6210-01-P