[Federal Register Volume 81, Number 150 (Thursday, August 4, 2016)]
[Proposed Rules]
[Pages 51400-51404]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-18059]
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FEDERAL RESERVE SYSTEM
12 CFR Part 213
[Docket No. R-1545]
RIN 7100 AE-56
BUREAU OF CONSUMER FINANCIAL PROTECTION
12 CFR Part 1013
[Docket No. CFPB-2016-0036]
Consumer Leasing (Regulation M)
AGENCY: Board of Governors of the Federal Reserve System (Board); and
Bureau of Consumer Financial Protection (Bureau).
ACTION: Proposed rule; official interpretations.
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SUMMARY: The Board and the Bureau are proposing to amend the official
interpretations and commentary for the agencies' regulations that
implement the Consumer Leasing Act (CLA). The Dodd-Frank Wall Street
Reform and Consumer Protection Act (Dodd-Frank Act) amended the CLA by
requiring that the dollar threshold for exempt consumer credit
transactions be adjusted annually by the annual percentage increase in
the Consumer Price Index for Urban Wage Earners and Clerical Workers
(CPI-W). If there is no annual percentage increase in the CPI-W, the
Board and Bureau will not adjust this exemption threshold from the
prior year. The proposal would memorialize this as well as the
agencies' calculation method for determining the adjustment in years
following a year in which there is no annual percentage increase in the
CPI-W.
Because the Dodd-Frank Act also requires similar adjustments in the
Truth in Lending Act's threshold for exempt consumer credit
transactions, the Board and the Bureau are proposing similar amendments
to the commentaries to each of their respective regulations
implementing the Truth in Lending Act elsewhere in the Federal
Register.
DATES: Comments must be received on or before September 6, 2016.
ADDRESSES: Interested parties are encouraged to submit written comments
jointly to the Board and the Bureau. Commenters are encouraged to use
the title ``Consumer Leasing (Regulation M)'' to facilitate the
organization and distribution of comments among the agencies.
Interested parties are invited to submit written comments to:
Board: You may submit comments, identified by Docket No. R-1545 or
RIN 7100 AE-56, by any of the following methods:
Agency Web site: http://www.federalreserve.gov. Follow the
instructions for submitting comments at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm.
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
Email: [email protected]. Include the
docket number in the subject line of the message.
Fax: (202) 452-3819 or (202) 452-3102.
Mail: Robert deV. Frierson, Secretary, Board of Governors
of the Federal Reserve System, 20th Street and Constitution Avenue NW.,
Washington, DC 20551.
All public comments will be made available on the Board's Web site
at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm as
submitted, unless modified for technical reasons. Accordingly, comments
will not be edited to remove any identifying or contact information.
Public comments may also be viewed electronically or in paper in Room
MP-500 of the Board's Martin Building (20th and C Streets NW.,) between
9:00 a.m. and 5:00 p.m. on weekdays.
Bureau: You may submit comments, identified by Docket No. CFPB-
2016-0036 by any of the following methods:
Email: [email protected]. Include Docket
No. CFPB-2016-0036 in the subject line of the email.
Electronic: http://www.regulations.gov. Follow the
instructions for submitting comments.
Mail: Monica Jackson, Office of the Executive Secretary,
Consumer Financial Protection Bureau, 1700 G Street NW., Washington, DC
20552.
Hand Delivery/Courier: Monica Jackson, Office of the
Executive Secretary, Consumer Financial Protection Bureau, 1275 First
Street NE., Washington, DC 20002.
Instructions: All submissions should include the agency name and
docket number or Regulatory Information Number (RIN) for this
rulemaking. Because paper mail in the Washington, DC area and at the
Bureau is subject to delay, commenters are encouraged to submit
comments electronically. In general, all comments received will be
posted without change to http://www.regulations.gov. In addition,
comments will be available for public inspection and copying at 1275
First Street NE., Washington, DC 20002, on official business days
between the hours of 10 a.m. and 5 p.m. eastern time. You can make an
appointment to inspect the documents by telephoning (202) 435-7275.
All comments, including attachments and other supporting materials,
will become part of the public record and subject to public disclosure.
Sensitive personal information, such as account numbers or Social
Security numbers, should not be included. Comments will not be edited
to remove any identifying or contact information.
FOR FURTHER INFORMATION CONTACT: Board: Vivian W. Wong, Senior Counsel,
Division of Consumer and Community Affairs, Board of Governors of the
Federal Reserve System, at (202) 452-3667; for users of
Telecommunications Device for the Deaf (TDD) only, contact (202) 263-
4869.
Bureau: Shaakira Gold-Ramirez, Paralegal Specialist, Jaclyn Maier,
Counsel, Office of Regulations, Consumer Financial Protection Bureau,
at (202) 435-7700.
SUPPLEMENTARY INFORMATION:
[[Page 51401]]
I. Background
The Dodd-Frank Wall Street Reform and Consumer Protection Act of
2010 (Dodd-Frank Act) increased the threshold in the Consumer Leasing
Act (CLA) for exempt consumer leases from $25,000 to $50,000, effective
July 21, 2011.\1\ In addition, the Dodd-Frank Act requires that, on and
after December 31, 2011, this threshold be adjusted annually for
inflation by the annual percentage increase in the Consumer Price Index
for Urban Wage Earners and Clerical Workers (CPI-W), as published by
the Bureau of Labor Statistics. In April 2011, the Board issued a final
rule amending Regulation M (which implements the CLA) consistent with
these provisions of the Dodd-Frank Act along with a similar final rule
amending Regulation Z (which implements the Truth in Lending Act)
(collectively, the Board Final Threshold Rules).\2\
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\1\ Public Law 111-203, section 1100E, 124 Stat. 1376 (2010).
\2\ 76 FR 18349 (Apr. 4, 2011); 76 FR 18354 (Apr. 4, 2011).
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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. In connection with this transfer of
rulemaking authority, the Bureau issued its own Regulation M
implementing the CLA in an interim final rule, 12 CFR part 1013 (Bureau
Interim Final Rule).\3\ The Bureau Interim Final Rule substantially
duplicated the Board's Regulation M, including the revisions to the
threshold for exempt transactions made by the Board in April 2011. In
April 2016, the Bureau adopted the Bureau Interim Final Rule as final,
subject to intervening final rules published by the Bureau.\4\ Although
the Bureau has the authority to issue rules to implement the CLA for
most entities, the Board retains authority to issue rules under the CLA
for certain motor vehicle dealers covered by section 1029(a) of the
Dodd-Frank Act, and the Board's Regulation M continues to apply to
those entities.\5\
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\3\ 76 FR 78500 (Dec. 19, 2011).
\4\ 81 FR 25323 (April 28, 2016).
\5\ Section 1029(a) of the Dodd-Frank Act states: ``Except as
permitted in subsection (b), the Bureau may not exercise any
rulemaking, supervisory, enforcement, or any other authority * * *
over a motor vehicle dealer that is predominantly engaged in the
sale and servicing of motor vehicles, the leasing and servicing of
motor vehicles, or both.'' 12 U.S.C. 5519(a). Section 1029(b) of the
Dodd-Frank Act states: ``Subsection (a) shall not apply to any
person, to the extent that such person (1) provides consumers with
any services related to residential or commercial mortgages or self-
financing transactions involving real property; (2) operates a line
of business (A) that involves the extension of retail credit or
retail leases involving motor vehicles; and (B) in which (i) the
extension of retail credit or retail leases are provided directly to
consumers; and (ii) the contract governing such extension of retail
credit or retail leases is not routinely assigned to an unaffiliated
third party finance or leasing source; or (3) offers or provides a
consumer financial product or service not involving or related to
the sale, financing, leasing, rental, repair, refurbishment,
maintenance, or other servicing of motor vehicles, motor vehicle
parts, or any related or ancillary product or service.'' 12 U.S.C.
5519(b).
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Section 213.2(e)(1) of the Board's Regulation M and Sec.
1013.2(e)(1) of the Bureau's Regulation M, and their accompanying
commentaries, provide that the exemption threshold will be adjusted
annually effective January 1 of each year based on any annual
percentage increase in the CPI-W that was in effect on the preceding
June 1. Any increase in the threshold amount will be rounded to the
nearest $100 increment. For example, if the annual percentage increase
in the CPI-W would result in a $950 increase in the threshold amount,
the threshold amount will be increased by $1,000. However, if the
annual percentage increase in the CPI-W would result in a $949 increase
in the threshold amount, the threshold amount will be increased by
$900.\6\ If there is no annual percentage increase in the CPI-W, the
Board and Bureau will not adjust the exemption threshold from the prior
year.
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\6\ See comments 2(e)-9 in Supplements I of 12 CFR part 213 and
12 CFR part 1013.
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Since 2011, the Board and the Bureau have adjusted the Regulation M
exemption threshold annually, consistent with these rules. The Board
and the Bureau last published final rules implementing the exemption
threshold in effect for January 1, 2016, through December 31, 2016, in
November 2015.\7\
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\7\ 80 FR 73945 (Nov. 27, 2015).
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II. Commentary Revision
The Board and the Bureau are proposing new commentary to
memorialize the calculation method used by the agencies each year to
adjust the exemption threshold. Comment 2(e)-9 to the Board's and
Bureau's Regulation M currently provides the threshold amount in effect
during a particular period and details the rules the agencies use for
rounding the threshold calculation to the nearest $100 or $1,000
increment, as discussed above in part I, ``Background.''
The Board and the Bureau are proposing to revise comment 2(e)-9 by
moving the text regarding the threshold amount that is in effect during
a particular period to a new proposed comment 2(e)-11. The discussion
of how the agencies round the threshold calculation would remain in
comment 2(e)-9.
As stated in the Board Final Threshold Rules, if there is no annual
percentage increase in the CPI-W, the Board and Bureau will not adjust
the exemption threshold from the prior year.\8\ This position is
consistent with Section 1100E(b) of the Dodd-Frank Act, which states
that the threshold must be adjusted by the ``annual percentage
increase'' in the CPI-W (emphasis added). The Board and the Bureau are
proposing to memorialize this concept in proposed comment 2(e)-10,
which would provide that if the CPI-W in effect on June 1 does not
increase from the CPI-W in effect on June 1 of the previous year, the
threshold amount effective the following January 1 through December 31
will not change from the previous year. For example, if the threshold
in effect from January 1, 2019, through December 31, 2019, is $55,500
and the CPI-W in effect on June 1 of 2019, indicates a 1.1 percent
decrease from the CPI-W in effect on June 1, 2018, the threshold in
effect for January 1, 2020, through December 31, 2020, will remain
$55,500.
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\8\ 76 FR 18354, 18355 n.1 (Apr. 4, 2011) (``[A]n annual period
of deflation or no inflation would not require a change in the
threshold amount.'').
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Proposed comment 2(e)-10 would further set forth the calculation
method the agencies would use in years following a year in which the
exemption threshold was not adjusted because there was no increase in
the CPI-W from the previous year. The proposed calculation method would
ensure that the values for the exemption threshold keep pace with the
CPI-W as contemplated by Section 1100E(b) of the Dodd-Frank Act.
Specifically, as set forth under proposed comment 2(e)-10, for the
years after a year in which the threshold did not change because the
CPI-W in effect on June 1 decreased from the CPI-W in effect on June 1
of the previous year, the threshold is calculated by applying the
annual percentage change in the CPI-W to the dollar amount that would
have resulted if the decreases and any subsequent increases in the CPI-
W had been taken into account. Proposed comment 2(e)-10.i further
states that, if the resulting amount is greater than the current
threshold, then the threshold effective January 1 the following year
will increase accordingly.
For example, assume that the threshold in effect from January 1,
2019, through December 31, 2019, is $55,500 and that, due to a 1.1
percent decrease from the CPI-W in effect on June 1,
[[Page 51402]]
2018, to the CPI-W in effect on June 1, 2019, the threshold in effect
from January 1, 2020, through December 31, 2020, remains at $55,500.
If, however, the threshold had been adjusted downward to reflect the
decrease in the CPI-W over that time period, the threshold in effect
from January 1, 2020, through December 31, 2020, would have been
$54,900. Further assume that the CPI-W in effect on June 1, 2020,
increased by 1.6 percent from the CPI-W in effect on June 1, 2019. The
calculation for the threshold that will be in effect from January 1,
2021, through December 31, 2021, is based on the impact of a 1.6
percent increase in the CPI-W on $54,900, rather than $55,500,
resulting in a 2021 threshold of $55,800.
Furthermore, comment 2(e)-10.ii states that, if the resulting
amount calculated is equal to or less than the current threshold, then
the threshold effective January 1 the following year will not change,
but future increases will be calculated based on the amount that would
have resulted. To illustrate, assume in the example above that the CPI-
W in effect on June 1, 2020, increased by only 0.6 percent from the
CPI-W in effect on June 1, 2019. The calculation for the threshold that
will be in effect from January 1, 2021, through December 31, 2021, is
based on the impact of a 0.6 percent increase in the CPI-W on $54,900.
The resulting amount is $55,200, which is lower than $55,500, the
threshold in effect from January 1, 2020, through December 31, 2020.
Therefore, the threshold in effect from January 1, 2021, through
December 31, 2021, will remain $55,500. However, the calculation for
the threshold that will be in effect from January 1, 2022, through
December 31, 2022, will apply the percentage change in the CPI-W to
$55,200, the amount that would have resulted based on the 0.6 percent
change from the CPI-W in effect on June 1, 2019, to the CPI-W in effect
on June 1, 2020.
The agencies request comment on all aspects of the proposed rule.
III. Regulatory Analysis
Bureau's Dodd-Frank Act Section 1022(b)(2) Analysis
In developing this proposal, the Bureau has considered potential
benefits, costs, and impacts.\9\ In addition, the Bureau has consulted,
or offered to consult with, the prudential regulators, the Securities
and Exchange Commission, the Department of Housing and Urban
Development, the Federal Housing Finance Agency, the Federal Trade
Commission, and the Department of the Treasury, including regarding
consistency with any prudential, market, or systemic objectives
administered by such agencies.
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\9\ Specifically, section 1022(b)(2)(A) calls for the Bureau to
consider the potential benefits and costs of a regulation to
consumers and covered persons, including the potential reduction of
access by consumers to consumer financial products or services; the
impact on depository institutions and credit unions with $10 billion
or less in total assets as described in section 1026 of the Act; and
the impact on consumers in rural areas.
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The Bureau has chosen to evaluate the benefits, costs and impacts
of the proposed commentary against the current state of the world,
which takes into account the current regulatory regime. The Bureau is
not aware of any significant benefits or costs to consumers or covered
persons associated with the proposal relative to the baseline. The
Board previously stated that if there is no annual percentage increase
in the CPI-W, then the Board (and now the Bureau) will not adjust the
exemption threshold from the prior year.\10\ The proposal memorializes
this in official commentary. The proposal also clarifies how the
threshold would be calculated for years after a year in which the
threshold did not change. The Bureau believes that this clarification
memorializes the method that the Bureau would be expected to use: This
method holds the threshold fixed until a notional threshold calculated
using the Bureau's methodology, but taking into account both decreases
and increases in the CPI-W, exceeds the actual threshold. The Bureau
requests comment on this point. Thus, the Bureau believes that the
proposed rule does not change the regulatory regime relative to the
baseline and creates no significant benefits, costs, or impacts.
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\10\ 76 FR 18354, 18355 n.1 (Apr. 4, 2011) (``[A]n annual period
of deflation or no inflation would not require a change in the
threshold amount.'').
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The proposed rule will have no unique impact on depository
institutions or credit unions with $10 billion or less in assets as
described in section 1026(a) of the Dodd-Frank Act or on rural
consumers. The Bureau does not expect this final rule to affect
consumers' access to credit.
Regulatory Flexibility Act
Board: The Regulatory Flexibility Act (RFA) requires an agency to
publish an initial regulatory flexibility analysis with a proposed rule
or certify that the proposed rule will not have a significant economic
impact on a substantial number of small entities.\11\ Based on its
analysis, and for the reasons stated below, the Board believes that the
rule will not have a significant economic impact on a substantial
number of small entities. Nevertheless, the Board is publishing an
initial regulatory flexibility analysis and requests public comment on
all aspects of its analysis. The Board will, if necessary, conduct a
final regulatory flexibility analysis after considering the comments
received during the public comment period.
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\11\ See 5 U.S.C. 601 et seq.
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1. Statement of the need for, and objectives of, the proposed rule.
The proposed rule would memorialize the calculation method used by the
Board each year to adjust the exemption threshold in accordance with
Section 1100E of the Dodd-Frank Act.
2. Small entities affected by the proposed rule. Motor vehicle
dealers that are subject to the Board's Regulation M and offer consumer
leases that may be exempt from Regulation M under 12 CFR 213.2(e) would
be affected. While the total number of small entities likely to be
affected by the proposed rule is unknown, the Board does not believe
the proposed rule will have a significant economic impact on the
entities that it affects. The Board invites comment on the effect of
the proposed rule on small entities.
3. Recordkeeping, reporting, and compliance requirements. The
proposed rule would not impose any recordkeeping, reporting, or
compliance requirements.
4. Other Federal rules. The Board has not identified any likely
duplication, overlap and/or potential conflict between the proposed
rule and any Federal rule.
5. Significant alternatives to the proposed revisions. The Board
solicits comment on any significant alternatives that would reduce the
regulatory burden associated on small entities with this proposed rule.
Bureau: The RFA generally requires an agency to conduct an initial
regulatory flexibility analysis (IRFA) and a final regulatory
flexibility analysis (FRFA) of any rule subject to notice-and-comment
rulemaking requirements.\12\ These analyses must ``describe the impact
of the proposed rule on small entities''.\13\ An IRFA or
[[Page 51403]]
FRFA is not required if the agency certifies that the rule will not
have a significant economic impact on a substantial number of small
entities.\14\ The Bureau also is subject to certain additional
procedures under the RFA involving the convening of a panel to consult
with small business representatives prior to proposing a rule for which
an IRFA is required.\15\
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\12\ 5 U.S.C. 601 et seq.
\13\ Id. at 603(a). For purposes of assessing the impacts of the
proposed rule on small entities, ``small entities'' is defined in
the RFA to include small businesses, small not-for-profit
organizations, and small government jurisdictions. Id. at 601(6). A
``small business'' is determined by application of Small Business
Administration regulations and reference to the North American
Industry Classification System (NAICS) classifications and size
standards. Id. at 601(3). A ``small organization'' is any ``not-for-
profit enterprise which is independently owned and operated and is
not dominant in its field.'' Id. at 601(4). A ``small governmental
jurisdiction'' is the government of a city, county, town, township,
village, school district, or special district with a population of
less than 50,000. Id. at 601(5).
\14\ Id. at 605(b).
\15\ Id. at 609.
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An IRFA is not required for this proposal because if adopted it
would not have a significant economic impact on a substantial number of
small entities. As discussed in the Bureau's Section 1022(b)(2)
Analysis above, this proposal does not introduce costs or benefits to
covered persons because the proposal seeks only to clarify the method
of threshold adjustment which has already been established in previous
Agency rules. Therefore this proposed rule would not have a significant
impact on small entities.
Certification
Accordingly, the Bureau Director, by signing below, certifies that
this proposal, if adopted, would not have a significant economic impact
on a substantial number of small entities.
Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1995,\16\ the
agencies reviewed this proposed rule. No collections of information
pursuant to the Paperwork Reduction Act are contained in the proposed
rule.
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\16\ 44 U.S.C. 3506; 5 CFR 1320.
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List of Subjects
12 CFR Part 213
Advertising, Consumer leasing, Consumer protection, Federal Reserve
System, Reporting and recordkeeping requirements.
12 CFR Part 1013
Advertising, Consumer leasing, Reporting and recordkeeping
requirements, Truth in Lending.
Board of Governors of the Federal Reserve System
Text of Proposed Revisions
For the reasons set forth in the preamble, the Board proposes to
amend Regulation M, 12 CFR part 213, as set forth below:
PART 213--CONSUMER LEASING (REGULATION M)
0
1. The authority citation for part 213 continues to read as follows:
Authority: 15 U.S.C. 1604 and 1667f; Pub. L. 111-203 Sec.
1100E, 124 Stat. 1376.
0
2. In Supplement I to Part 213, under Section 213.2--Definitions, under
2(e) Consumer Lease, paragraph 9. is revised, and paragraphs 10. and
11. are added, to read as follows:
Supplement I to Part 213--Official Staff Interpretations
* * * * *
Sec. 213.2 Definitions.
* * * * *
2(e) Consumer Lease
* * * * *
9. Threshold amount. A consumer lease is exempt from the
requirements of this Part if the total contractual obligation exceeds
the threshold amount in effect at the time of consummation. The
threshold amount in effect during a particular time period is the
amount stated in comment 2(e)-11 for that period. The threshold amount
is adjusted effective January 1 of each year by any annual percentage
increase in the Consumer Price Index for Urban Wage Earners and
Clerical Workers (CPI-W) that was in effect on the preceding June 1.
Comment 2(e)-11 will be amended to provide the threshold amount for the
upcoming year after the annual percentage change in the CPI-W that was
in effect on June 1 becomes available. Any increase in the threshold
amount will be rounded to the nearest $100 increment. For example, if
the annual percentage increase in the CPI-W would result in a $950
increase in the threshold amount, the threshold amount will be
increased by $1,000. However, if the annual percentage increase in the
CPI-W would result in a $949 increase in the threshold amount, the
threshold amount will be increased by $900. If a consumer lease is
exempt from the requirements of this Part because the total contractual
obligation exceeds the threshold amount in effect at the time of
consummation, the lease remains exempt regardless of a subsequent
increase in the threshold amount.
10. No increase in the CPI-W. If the CPI-W in effect on June 1 does
not increase from the CPI-W in effect on June 1 of the previous year,
the threshold amount effective the following January 1 through December
31 will not change from the previous year. When this occurs, for the
years that follow, the threshold is calculated based on the annual
percentage change in the CPI-W applied to the dollar amount that would
have resulted if decreases and any subsequent increases in the CPI-W
had been taken into account.
i. Net increases. If the resulting amount is greater than the
current threshold, then the threshold effective January 1 the following
year will increase accordingly.
ii. Net decreases. If the resulting amount calculated is equal to
or less than the current threshold, then the threshold effective
January 1 the following year will not change, but future increases will
be calculated based on the amount that would have resulted.
11. Threshold. For purposes of Sec. 213.2(e)(1), the threshold
amount in effect during a particular period is the amount stated below
for that period.
i. Prior to July 21, 2011, the threshold amount is $25,000.
ii. From July 21, 2011 through December 31, 2011, the threshold
amount is $50,000.
iii. From January 1, 2012 through December 31, 2012, the threshold
amount is $51,800.
iv. From January 1, 2013 through December 31, 2013, the threshold
amount is $53,000.
v. From January 1, 2014 through December 31, 2014, the threshold
amount is $53,500.
vi. From January 1, 2015 through December 31, 2015, the threshold
amount is $54,600.
vii. From January 1, 2016 through December 31, 2016, the threshold
amount is $54,600.
Bureau of Consumer Financial Protection
Authority and Issuance
For the reasons set forth in the preamble, the Bureau proposes to
amend Regulation M, 12 CFR part 1013, as set forth below:
PART 1013--CONSUMER LEASING (REGULATION M)
0
3. The authority citation for part 1013 continues to read as follows:
Authority: 15 U.S.C. 1604 and 1667f; Pub. L. 111-203 Sec.
1100E, 124 Stat. 1376.
0
4. In Supplement I to part 1013, under Section 1013.2--Definitions,
under 2(e)--Consumer Lease, paragraph 9 is revised, and paragraphs 10
and 11 are added, to read as follows:
Supplement I to Part 1013--Official Interpretations
* * * * *
Sec. 1013.2 Definitions.
* * * * *
[[Page 51404]]
2(e) Consumer Lease
* * * * *
9. Threshold amount. A consumer lease is exempt from the
requirements of this part if the total contractual obligation exceeds
the threshold amount in effect at the time of consummation. The
threshold amount in effect during a particular time period is the
amount stated in comment 2(e)-11 for that period. The threshold amount
is adjusted effective January 1 of each year by any annual percentage
increase in the Consumer Price Index for Urban Wage Earners and
Clerical Workers (CPI-W) that was in effect on the preceding June 1.
Comment 2(e)-11 will be amended to provide the threshold amount for the
upcoming year after the annual percentage change in the CPI-W that was
in effect on June 1 becomes available. Any increase in the threshold
amount will be rounded to the nearest $100 increment. For example, if
the annual percentage increase in the CPI-W would result in a $950
increase in the threshold amount, the threshold amount will be
increased by $1,000. However, if the annual percentage increase in the
CPI-W would result in a $949 increase in the threshold amount, the
threshold amount will be increased by $900. If a consumer lease is
exempt from the requirements of this part because the total contractual
obligation exceeds the threshold amount in effect at the time of
consummation, the lease remains exempt regardless of a subsequent
increase in the threshold amount.
10. No increase in the CPI-W. If the CPI-W in effect on June 1 does
not increase from the CPI-W in effect on June 1 of the previous year,
the threshold amount effective the following January 1 through December
31 will not change from the previous year. When this occurs, for the
years that follow, the threshold is calculated based on the annual
percentage change in the CPI-W applied to the dollar amount that would
have resulted if decreases and any subsequent increases in the CPI-W
had been taken into account.
i. Net increases. If the resulting amount is greater than the
current threshold, then the threshold effective January 1 the following
year will increase accordingly.
ii. Net decreases. If the resulting amount calculated is equal to
or less than the current threshold, then the threshold effective
January 1 the following year will not change, but future increases will
be calculated based on the amount that would have resulted.
11. Threshold. For purposes of Sec. 1013.2(e)(1), the threshold
amount in effect during a particular period is the amount stated below
for that period.
i. Prior to July 21, 2011, the threshold amount is $25,000.
ii. From July 21, 2011 through December 31, 2011, the threshold
amount is $50,000.
iii. From January 1, 2012 through December 31, 2012, the threshold
amount is $51,800.
iv. From January 1, 2013 through December 31, 2013, the threshold
amount is $53,000.
v. From January 1, 2014 through December 31, 2014, the threshold
amount is $53,500.
vi. From January 1, 2015 through December 31, 2015, the threshold
amount is $54,600.
vii. From January 1, 2016 through December 31, 2016, the threshold
amount is $54,600.
By order of the Board of Governors of the Federal Reserve
System, July 19, 2016.
Robert deV. Frierson,
Secretary of the Board.
Dated: July 13, 2016.
Richard Cordray,
Director, Bureau of Consumer Financial Protection.
[FR Doc. 2016-18059 Filed 8-3-16; 8:45 am]
BILLING CODE 6210-01-4810-AM-P