[Federal Register Volume 60, Number 234 (Wednesday, December 6, 1995)]
[Proposed Rules]
[Page 62349]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-29697]



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FEDERAL RESERVE SYSTEM

12 CFR Part 213

[Regulation M; Docket No. R-0892 and Docket No. R-0893]


Consumer Leasing; Extension of Comment Period

AGENCY: Board of Governors of the Federal Reserve System.

ACTION: Proposed rule and official staff interpretation; extension of 
comment period.

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SUMMARY: On September 20, 1995, the Board published a request for 
comment on proposed amendments to Regulation M, which implements the 
Consumer Leasing Act (60 FR 48752). At that time, the Board also 
proposed revisions to the official staff commentary to Regulation M, 
which were published in the same issue of the Federal Register (60 FR 
48769). The Consumer Leasing Act and Regulation M require lessors to 
provide uniform cost and other disclosures about consumer lease 
transactions. The Board's proposal contains several substantive 
amendments to the regulation and would also simplify and clarify its 
provisions. In order to obtain additional views on the proposal from 
individual consumers, the Board has extended the public comment period 
for 90 days. The comment period for the proposed revisions to the 
commentary is similarly extended for 90 days.

DATES: Comments must be received by February 15, 1996.

ADDRESSES: Comments should refer to Docket No. R-0892 and Docket No. R-
0893, and be mailed to William W. Wiles, Secretary, Board of Governors 
of the Federal Reserve System, 20th Street and Constitution Avenue NW., 
Washington, DC 20551. Comments also may be delivered to room B-2222 of 
the Eccles Building between 8:45 a.m. and 5:15 p.m. weekdays, or to the 
guard station in the Eccles Building courtyard on 20th Street NW., 
(between Constitution Avenue and C Street) any time. Comments may be 
inspected in room MP-500 of the Martin Building between 9 a.m. and 5 
p.m. weekdays, except as provided in 12 CFR 261.8 of the Board's rules 
regarding the availability of information.

FOR FURTHER INFORMATION CONTACT: Kyung H. Cho-Miller, Obrea O. 
Poindexter, or W. Kurt Schumacher, Staff Attorneys, Division of 
Consumer and Community Affairs, Board of Governors of the Federal 
Reserve System, Washington, DC 20551, at (202) 452-2412 or 452-3667. 
For users of Telecommunications Device for the Deaf (TDD), please 
contact Dorothea Thompson at (202) 452-3544.

SUPPLEMENTARY INFORMATION: The Consumer Leasing Act (CLA), 15 U.S.C. 
1667-1667e, was enacted into law in 1976 as an amendment to the Truth 
in Lending Act (TILA), 15 U.S.C. 1601 et seq. The Board was given 
rulewriting authority, and its Regulation M (12 CFR part 213) 
implements the CLA. An official staff commentary that interprets the 
regulation has also been published (Supplement I-CL-1 to 12 CFR 213).
    The CLA generally governs consumer leases of personal property 
involving $25,000 or less and a term of more than four months. An 
automobile lease is the most common type of consumer lease covered by 
the CLA. Like the credit provisions of the TILA, the CLA requires 
lessors to provide uniform cost and other disclosures in consumer lease 
transactions and lease advertising. Prior to entering into a lease 
agreement, lessors must give consumers fifteen to twenty disclosures, 
including the amount of initial charges to be paid, an identification 
of leased property, a payment schedule, the responsibilities for 
maintaining the leased property, and the liability for terminating a 
lease early.
    The Board's Regulatory Planning and Review Program calls for the 
periodic review of Board regulations with four goals in mind: To 
clarify and simplify regulatory language; to determine whether 
regulatory amendments are needed to address technological and other 
developments; to reduce undue regulatory burden on the industry; and to 
delete obsolete provisions. On September 20, 1995, the Board published 
proposed revisions to Regulation M for comment (60 FR 48752). The 
proposal contains several substantive revisions to the regulation, for 
example: additional disclosure requirements about early termination 
charges, the gross cost of leases, the residual value, and the 
estimated lease charge; a requirement that certain leasing disclosures 
be segregated from other information; and pursuant to a statutory 
change, revisions to the advertising provisions for radio and 
television. The proposal also simplifies the language and format of the 
regulation to state the requirements more clearly.
    The Board is extending the comment period until February 15, 1996, 
in order to obtain views on the proposals from consumers who have 
experience in leasing or are interested in leasing, by inviting certain 
individuals to participate in focus groups. The focus group 
participants will be asked to address key elements of the Board's 
proposed amendments to Regulation M and to provide comments on the 
proposed consumer leasing forms.
    During the extension period, the Board's staff will undertake its 
review and analysis of the comments that have already been filed. The 
comment period is being extended primarily for the purpose of 
conducting these focus group interviews. Other members of the public 
may submit comments during this period, but they are encouraged to 
submit them as soon as possible. The Board does not expect this 
extension to delay the implementation of the final rule. The Board 
anticipates that revisions to Regulation M and the official staff 
commentary will be adopted in final form in the second quarter of 1996.

    Board of Governors of the Federal Reserve System, November 30, 
1995.
William W. Wiles,
Secretary of the Board.
[FR Doc. 95-29697 Filed 12-5-95; 8:45 am]
BILLING CODE 6210-01-P