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Union Calendar No. 84

106TH CONGRESS

1ST SESSION H. R. 1400

[Report No. 106–149]

To amend the Securities Exchange Act of 1934 to improve collection and

dissemination of information concerning bond prices and to improve

price competition in bond markets, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

APRIL 14 , 1999

Mr. BLILEY (for himself, Mr. OXLEY, Mr. DINGELL, Mr. TAUZIN, Mr.

TOWNS, Mr. GILLMOR, Mr. MARKEY, Mr. GREENWOOD, Mr. HALL of

Texas, Mr. COX, Mr. PALLONE, Mr. LARGENT, Mr. DEUTSCH, Mr.

BILBRAY, Mr. STUPAK, Mr. GANSKE, Mr. ENGEL, Mr. LAZIO, Ms.

DEGETTE, Mr. SHIMKUS, Mr. BARRETT of Wisconsin, Mrs. WILSON, Mr.

LUTHER, Mr. SHADEGG, Mrs. CAPPS, Mr. FOSSELLA, Mr. BLUNT, and

Mr. EHRLICH) introduced the following bill; which was referred to the

Committee on Commerce

MAY 18, 1999

Committed to the Committee of the Whole House on the State of the Union

and ordered to be printed

A BILL

To amend the Securities Exchange Act of 1934 to improve

collection and dissemination of information concerning

bond prices and to improve price competition in bond

markets, and for other purposes.
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1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Bond Price Competi5 tion Improvement Act of 1999’’.

6 SEC. 2. EXTENSION OF TRANSACTION REPORTING TO DEBT

7 SECURITIES.

8 (a) AMENDMENT.—Subsection (d) of section 11A of

9 the Securities Exchange Act of 1934 (15 U.S.C. 78k–

10 1(d)) is amended to read as follows:

11 ‘‘(d) MINIMUM REQUIREMENTS FOR TRANSACTION

12 INFORMATION ON DEBT SECURITIES.—

13 ‘‘(1) ACTION REQUIRED.—The Commission

14 shall adopt such rules and take such other actions

15 under this section as may be necessary or appro16 priate, having due regard for the public interest, the

17 protection of investors, and the maintenance of fair

18 and orderly markets to assure the prompt, accurate,

19 reliable, and fair collection, processing, distribution,

20 and publication of transaction information, including

21 last sale data, with respect to covered debt securities

22 so that such information is available to all exchange

23 members, brokers, dealers, securities information

24 processors, and all other persons. In determining the

25 rules or other actions to take under this subsection,
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1 the Commission shall take into consideration, among

2 other factors, private sector systems for the collec3 tion and distribution of transaction information on

4 corporate debt securities.

5 ‘‘(2) EFFECT ON OTHER AUTHORITY.—Nothing

6 in this subsection limits or otherwise alters the Com7 mission’s authority under the other provisions of this

8 section or any other provision of this title.

9 ‘‘(3) DEFINITIONS.—For purposes of this sub10 section:

11 ‘‘(A) COVERED DEBT SECURITIES.—The

12 term ‘covered debt securities’ means bonds, de13 bentures, or other debt instruments of an

14 issuer, other than—

15 ‘‘(i) exempted securities; and

16 ‘‘(ii) securities that the Commission

17 determines by rule to except from the re18 quirements of this subsection.

19 ‘‘(B) TRANSACTION INFORMATION.—The

20 term ‘transaction information’ means informa21 tion concerning such price, volume, and yield

22 information associated with a transaction in23 volving the purchase or sale of a covered debt

24 security as may be prescribed by the Commis25 sion by rule for purposes of this subsection.
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1 ‘‘(C) FACTORS IN DEFINITIONAL RULES.—

2 In prescribing rules pursuant to this paragraph,

3 the Commission shall take into consideration

4 the extent to which a security is actively traded,

5 market liquidity, competition, the protection of

6 investors and the public interest, and other rel7 evant factors.’’.

8 (b) CONFORMING AMENDMENT.—Section

9 11A(a)(3)(A) of such Act is amended by striking ‘‘(which

10 shall be in addition to the National Market Advisory

11 Board established pursuant to subsection (d) of this sec12 tion)’’.

13 (c) DEADLINE FOR ACTION.—The Securities and Ex14 change Commission shall take action to implement the re15 quirements of section 11A(d) of the Securities Exchange

16 Act of 1934 (15 U.S.C. 78k–1(d)), as amended by sub17 section (a) of this section, within 12 months after the date

18 of enactment of this Act.

19 SEC. 3. TECHNICAL AMENDMENT.

20 Section 3(a)(12)(B) of the Securities Exchange Act

21 of 1934 (15 U.S.C. 78c(a)(12)(B)) is amended by adding

22 at the end the following new clause:

23 ‘‘(ii) Notwithstanding subparagraph (A)(i) of

24 this paragraph, securities described in subpara25 graphs (B) and (C) of paragraph (42) of this sub-
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1 section shall not be deemed to be exempted securi2 ties for purposes of section 11A of this title.’’.

3 SEC. 4. STUDIES.

4 (a) STUDIES REQUIRED.—The Comptroller General

5 shall conduct a study of measures needed in the public

6 interest and for the protection of investors to improve the

7 prompt, accurate, reliable, and fair collection, processing,

8 distribution, and publication of information concerning

9 transactions—

10 (1) in debt securities as to which transaction in11 formation is collected but not disseminated pursuant

12 to section 11A(d) of the Securities Exchange Act of

13 1934, as amended by this Act (15 U.S.C. 78k–1(d));

14 and

15 (2) in municipal securities (as such term is de16 fined in section 3(a)(29) of such Act (15 U.S.C.

17 78c(a)(29)).

18 (b) COMMISSION AND MSRB PARTICIPATION.—The

19 Comptroller General shall conduct the study required by

20 subsection (a)(1) in consultation with the Securities and

21 Exchange Commission, and the study required by sub22 section (a)(2) in consultation with the Securities and Ex23 change Commission and the Municipal Securities Rule24 making Board.
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1 (c) SUBMISSION OF REPORTS.—The Comptroller

2 General shall submit to the Congress a report on the stud3 ies required by subsection (a) within one year after the

4 date of enactment of this Act. Such reports shall include

5 an identification of the measures needed to improve the

6 prompt, accurate, reliable, and fair collection, processing,

7 distribution, and publication of information concerning

8 transactions in the debt securities and municipal securities

9 described in such subsection, including measures requiring

10 legislative or regulatory action.

Union Calendar No. 84

106TH CONGRESS

1ST SESSION H. R. 1400

[Report No. 106–149]

A BILL

To amend the Securities Exchange Act of 1934 to

poses.competition in bond markets, and for other purtion concerning bond prices and to improve priceimprove collection and dissemination of informaMAY 18, 1999

Committed to the Committee of the Whole House on the

State of the Union and ordered to be printed