362
filiate of such person and the credit 
union in default; 
‘‘(II) all claims of such person or 
any affiliate of such person against 
such credit union under any such con-
tract (other than any claim which, 
under the terms of any such contract, 
is subordinated to the claims of gen-
eral unsecured creditors of such credit 
union); 
‘‘(III) all claims of such credit 
union against such person or any af-
filiate of such person under any such 
contract; and 
‘‘(IV) all property securing or 
any other credit enhancement for any 
contract described in subclause (I) or 
any claim described in subclause (II) 
or (III) under any such contract; or 
‘‘(ii) transfer none of the qualified fi-
nancial contracts, claims, property or other 
credit enhancement referred to in clause (i) 
(with respect to such person and any affil-
iate of such person).
363
‘‘(B) TRANSFER TO FOREIGN BANK, FOR-
EIGN FINANCIAL INSTITUTION, OR BRANCH OR 
AGENCY OF A FOREIGN BANK OR FINANCIAL IN-
STITUTION.—In transferring any qualified fi-
nancial contracts and related claims and prop-
erty under subparagraph (A)(i), the conservator 
or liquidating agent for the credit union shall 
not make such transfer to a foreign bank, fi-
nancial institution organized under the laws of 
a foreign country, or a branch or agency of a 
foreign bank or financial institution unless, 
under the law applicable to such bank, financial 
institution, branch or agency, to the qualified 
financial contracts, and to any netting contract, 
any security agreement or arrangement or other 
credit enhancement related to 1 or more quali-
fied financial contracts, the contractual rights 
of the parties to such qualified financial con-
tracts, netting contracts, security agreements or 
arrangements, or other credit enhancements are 
enforceable substantially to the same extent as 
permitted under this section. 
‘‘(C) TRANSFER OF CONTRACTS SUBJECT 
TO
THE
RULES
OF
A
CLEARING
ORGANIZA-
TION.—In the event that a conservator or liqui-
364
dating agent transfers any qualified financial 
contract and related claims, property, and cred-
it enhancements pursuant to subparagraph 
(A)(i) and such contract is cleared by or subject 
to the rules of a clearing organization, the 
clearing organization shall not be required to 
accept the transferee as a member by virtue of 
the transfer. 
‘‘(D) DEFINITIONS.—For purposes of this 
paragraph—
‘‘(i) the term ‘financial institution’ 
means a broker or dealer, a depository in-
stitution, a futures commission merchant, 
a credit union, or any other institution, as 
determined by the Board by regulation to 
be a financial institution; and 
‘‘(ii) the term ‘clearing organization’ 
has the same meaning as in section 402 of 
the Federal Deposit Insurance Corporation 
Improvement Act of 1991.’’. 
(2) NOTICE
TO
QUALIFIED
FINANCIAL
CON-
TRACT COUNTERPARTIES.—Section 207(c)(10)(A) of 
the 
Federal 
Credit 
Union 
Act 
(12 
U.S.C. 
1787(c)(10)(A)) is amended in the material imme-
diately following clause (ii) by striking ‘‘the conser-
365
vator’’ and all that follows through the period and 
inserting the following: ‘‘the conservator or liqui-
dating agent shall notify any person who is a party 
to any such contract of such transfer by 5:00 p.m. 
(eastern time) on the business day following the date 
of the appointment of the liquidating agent in the 
case of a liquidation, or the business day following 
such transfer in the case of a conservatorship.’’. 
(3) RIGHTS AGAINST LIQUIDATING AGENT AND 
CONSERVATOR
AND
TREATMENT
OF
BRIDGE 
BANKS.—Section 207(c)(10) of the Federal Credit 
Union Act (12 U.S.C. 1787(c)(10)) is amended—
(A) by redesignating subparagraph (B) as 
subparagraph (D); and 
(B) by inserting after subparagraph (A) 
the following new subparagraphs: 
‘‘(B) CERTAIN
RIGHTS
NOT
ENFORCE-
ABLE.—
‘‘(i) LIQUIDATION.—A person who is 
a party to a qualified financial contract 
with an insured credit union may not exer-
cise any right that such person has to ter-
minate, liquidate, or net such contract 
under paragraph (8)(A) of this subsection 
or section 403 or 404 of the Federal De-
366
posit Insurance Corporation Improvement 
Act of 1991, solely by reason of or inci-
dental to the appointment of a liquidating 
agent for the credit union institution (or 
the insolvency or financial condition of the 
credit union for which the liquidating 
agent has been appointed)—
‘‘(I) until 5:00 p.m. (eastern 
time) on the business day following 
the date of the appointment of the liq-
uidating agent; or 
‘‘(II) after the person has re-
ceived notice that the contract has 
been transferred pursuant to para-
graph (9)(A). 
‘‘(ii) CONSERVATORSHIP.—A person 
who is a party to a qualified financial con-
tract with an insured credit union may not 
exercise any right that such person has to 
terminate, liquidate, or net such contract 
under paragraph (8)(E) of this subsection 
or section 403 or 404 of the Federal De-
posit Insurance Corporation Improvement 
Act of 1991, solely by reason of or inci-
dental to the appointment of a conservator