192 
SEC. 402. EFFECTIVE DATE. 
This subtitle and any amendment made by this sub-
title shall take effect on the date that is 90 days after the 
date of the enactment of this Act. 
Subtitle B—Encouraging Employee 
Ownership 
SEC. 406. INCREASED THRESHOLD FOR DISCLOSURES RE-
LATING TO COMPENSATORY BENEFIT PLANS. 
Not later than 60 days after the date of the enactment 
of this Act, the Securities and Exchange Commission shall 
revise section 230.701(e) of title 17, Code of Federal Regula-
tions, so as to increase from $5,000,000 to $20,000,000 the 
aggregate sales price or amount of securities sold during 
any consecutive 12-month period in excess of which the 
issuer is required under such section to deliver an addi-
tional disclosure to investors. The Commission shall index 
for inflation such aggregate sales price or amount every 5 
years to reflect the change in the Consumer Price Index for 
All Urban Consumers published by the Bureau of Labor 
Statistics, rounding to the nearest $1,000,000. 
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Subtitle C—Small Company 
Disclosure Simplification 
SEC. 411. EXEMPTION FROM XBRL REQUIREMENTS FOR 
EMERGING GROWTH COMPANIES AND OTHER 
SMALLER COMPANIES. 
(a) EXEMPTION
FOR EMERGING GROWTH COMPA-
NIES.—Emerging growth companies are exempted from the 
requirements to use Extensible Business Reporting Lan-
guage (XBRL) for financial statements and other periodic 
reporting required to be filed with the Commission under 
the securities laws. Such companies may elect to use XBRL 
for such reporting. 
(b) EXEMPTION FOR OTHER SMALLER COMPANIES.— 
Issuers with total annual gross revenues of less than 
$250,000,000 are exempt from the requirements to use 
XBRL for financial statements and other periodic reporting 
required to be filed with the Commission under the securi-
ties laws. Such issuers may elect to use XBRL for such re-
porting. An exemption under this subsection shall continue 
in effect until— 
(1) the date that is five years after the date of 
enactment of this Act; or 
(2) the date that is two years after a determina-
tion by the Commission, by order after conducting the 
analysis required by section 3, that the benefits of 
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such requirements to such issuers outweigh the costs, 
but no earlier than three years after enactment of this 
Act. 
(c) MODIFICATIONS TO REGULATIONS.—Not later than 
60 days after the date of enactment of this Act, the Commis-
sion shall revise its regulations under parts 229, 230, 232, 
239, 240, and 249 of title 17, Code of Federal Regulations, 
to reflect the exemptions set forth in subsections (a) and 
(b). 
SEC. 412. ANALYSIS BY THE SEC. 
The Commission shall conduct an analysis of the costs 
and benefits to issuers described in section 411(b) of the re-
quirements to use XBRL for financial statements and other 
periodic reporting required to be filed with the Commission 
under the securities laws. Such analysis shall include an 
assessment of— 
(1) how such costs and benefits may differ from 
the costs and benefits identified by the Commission in 
the order relating to interactive data to improve fi-
nancial reporting (dated January 30, 2009; 74 Fed. 
Reg. 6776) because of the size of such issuers; 
(2) the effects on efficiency, competition, capital 
formation, and financing and on analyst coverage of 
such issuers (including any such effects resulting from 
use of XBRL by investors); 
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(3) the costs to such issuers of— 
(A) submitting data to the Commission in 
XBRL; 
(B) posting data on the website of the issuer 
in XBRL; 
(C) software necessary to prepare, submit, 
or post data in XBRL; and 
(D) any additional consulting services or 
filing agent services; 
(4) the benefits to the Commission in terms of 
improved ability to monitor securities markets, assess 
the potential outcomes of regulatory alternatives, and 
enhance investor participation in corporate govern-
ance and promote capital formation; and 
(5) the effectiveness of standards in the United 
States for interactive filing data relative to the stand-
ards of international counterparts. 
SEC. 413. REPORT TO CONGRESS. 
Not later than one year after the date of enactment 
of this Act, the Commission shall provide the Committee 
on Financial Services of the House of Representatives and 
the Committee on Banking, Housing, and Urban Affairs 
of the Senate a report regarding— 
(1) the progress in implementing XBRL report-
ing within the Commission; 
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(2) the use of XBRL data by Commission offi-
cials; 
(3) the use of XBRL data by investors; 
(4) the results of the analysis required by section 
412; and 
(5) any additional information the Commission 
considers relevant for increasing transparency, de-
creasing costs, and increasing efficiency of regulatory 
filings with the Commission. 
SEC. 414. DEFINITIONS. 
As used in this subtitle, the terms ‘‘Commission’’, 
‘‘emerging growth company’’, ‘‘issuer’’, and ‘‘securities 
laws’’ have the meanings given such terms in section 3 of 
the Securities Exchange Act of 1934 (15 U.S.C. 78c). 
Subtitle 
D—Securities 
and 
Ex-
change 
Commission 
Overpay-
ment Credit 
SEC. 416. REFUNDING OR CREDITING OVERPAYMENT OF 
SECTION 31 FEES. 
(a) IN GENERAL.—Section 31 of the Securities Ex-
change Act of 1934 (15 U.S.C. 78ee) is amended by adding 
at the end the following: 
‘‘(n) OVERPAYMENT.—If a national securities ex-
change or national securities association pays to the Com-
mission an amount in excess of fees and assessments due 
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under this section and informs the Commission of such 
amount paid in excess within 10 years of the date of the 
payment, the Commission shall offset future fees and assess-
ments due by such exchange or association in an amount 
equal to such excess amount.’’. 
(b) APPLICABILITY.—The amendment made by this 
section shall apply to any fees and assessments paid before, 
on, or after the date of enactment of this section. 
Subtitle E—Fair Access to 
Investment Research 
SEC. 421. SAFE HARBOR FOR INVESTMENT FUND RE-
SEARCH. 
(a) EXPANSION OF THE SAFE HARBOR.—Not later 
than the end of the 45-day period beginning on the date 
of enactment of this Act, the Securities and Exchange Com-
mission shall propose, and not later than the end of the 
120-day period beginning on such date, the Commission 
shall adopt, upon such terms, conditions, or requirements 
as the Commission may determine necessary or appropriate 
in the public interest, for the protection of investors, and 
for the promotion of capital formation, revisions to section 
230.139 of title 17, Code of Federal Regulations, to provide 
that a covered investment fund research report that is pub-
lished or distributed by a broker or dealer— 
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(1) shall be deemed, for purposes of sections 
2(a)(10) and 5(c) of the Securities Act of 1933 (15 
U.S.C. 77b(a)(10), 77e(c)), not to constitute an offer 
for sale or an offer to sell a security that is the subject 
of an offering pursuant to a registration statement 
that is effective, even if the broker or dealer is partici-
pating or will participate in the registered offering of 
the covered investment fund’s securities; and 
(2) shall be deemed to satisfy the conditions of 
subsection (a)(1) or (a)(2) of section 230.139 of title 
17, Code of Federal Regulations, or any successor pro-
visions, for purposes of the Commission’s rules and 
regulations under the Federal securities laws and the 
rules of any self-regulatory organization. 
(b) IMPLEMENTATION OF SAFE HARBOR.—In imple-
menting the safe harbor pursuant to subsection (a), the 
Commission shall— 
(1) not, in the case of a covered investment fund 
with a class of securities in substantially continuous 
distribution, condition the safe harbor on whether the 
broker’s or dealer’s publication or distribution of a 
covered investment fund research report constitutes 
such broker’s or dealer’s initiation or reinitiation of 
research coverage on such covered investment fund or 
its securities; 
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(2) not— 
(A) require the covered investment fund to 
have been registered as an investment company 
under the Investment Company Act of 1940 (15 
U.S.C. 80a–1 et seq.) or subject to the reporting 
requirements of section 13 or 15(d) of the Securi-
ties Exchange Act of 1934 (15 U.S.C. 78m, 
78o(d)) for any period exceeding the period of 
time referenced under paragraph (a)(1)(i)(A)(1) 
of section 230.139 of title 17, Code of Federal 
Regulations; or 
(B) impose a minimum float provision ex-
ceeding 
that 
referenced 
in 
paragraph 
(a)(1)(i)(A)(1)(i) of section 230.139 of title 17, 
Code of Federal Regulations; 
(3) provide that a self-regulatory organization 
may not maintain or enforce any rule that would— 
(A) prohibit the ability of a member to pub-
lish or distribute a covered investment fund re-
search report solely because the member is also 
participating in a registered offering or other 
distribution of any securities of such covered in-
vestment fund; or 
(B) prohibit the ability of a member to par-
ticipate in a registered offering or other distribu-
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tion of securities of a covered investment fund 
solely because the member has published or dis-
tributed a covered investment fund research re-
port about such covered investment fund or its 
securities; and 
(4) provide that a covered investment fund re-
search report shall not be subject to section 24(b) of 
the Investment Company Act of 1940 (15 U.S.C. 80a– 
24(b)) or the rules and regulations thereunder, except 
that such report may still be subject to such section 
and the rules and regulations thereunder to the extent 
that it is otherwise not subject to the content stand-
ards in the rules of any self-regulatory organization 
related to research reports, including those contained 
in the rules governing communications with the pub-
lic regarding investment companies or substantially 
similar standards. 
(c) RULES OF CONSTRUCTION.—Nothing in this Act 
shall be construed as in any way limiting— 
(1) the applicability of the antifraud or 
antimanipulation provisions of the Federal securities 
laws and rules adopted thereunder to a covered invest-
ment fund research report, including section 17 of the 
Securities Act of 1933 (15 U.S.C. 77q), section 34(b) 
of the Investment Company Act of 1940 (15 U.S.C. 
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80a–33), and sections 9 and 10 of the Securities Ex-
change Act of 1934 (15 U.S.C. 78i, 78j); or 
(2) the authority of any self-regulatory organiza-
tion to examine or supervise a member’s practices in 
connection with such member’s publication or dis-
tribution of a covered investment fund research report 
for compliance with applicable provisions of the Fed-
eral securities laws or self-regulatory organization 
rules related to research reports, including those con-
tained in rules governing communications with the 
public. 
(d) INTERIM EFFECTIVENESS OF SAFE HARBOR.— 
(1) IN GENERAL.—From and after the 120-day 
period beginning on the date of enactment of this Act, 
if the Commission has not adopted revisions to section 
230.139 of title 17, Code of Federal Regulations, as 
required by subsection (a), and until such time as the 
Commission has done so, a broker or dealer distrib-
uting or publishing a covered investment fund re-
search report after such date shall be able to rely on 
the provisions of section 230.139 of title 17, Code of 
Federal Regulations, and the broker or dealer’s publi-
cation of such report shall be deemed to satisfy the 
conditions of subsection (a)(1) or (a)(2) of section 
230.139 of title 17, Code of Federal Regulations, if the 
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covered investment fund that is the subject of such re-
port satisfies the reporting history requirements 
(without regard to Form S–3 or Form F–3 eligi-
bility) and minimum float provisions of such sub-
sections for purposes of the Commission’s rules and 
regulations under the Federal securities laws and the 
rules of any self-regulatory organization, as if revised 
and implemented in accordance with subsections (a) 
and (b). 
(2) STATUS OF COVERED INVESTMENT FUND.— 
After such period and until the Commission has 
adopted revisions to section 230.139 and FINRA has 
revised rule 2210, for purposes of subsection (c)(7)(O) 
of such rule, a covered investment fund shall be 
deemed to be a security that is listed on a national 
securities exchange and that is not subject to section 
24(b) of the Investment Company Act of 1940 (15 
U.S.C. 80a–24(b)). Communications concerning only 
covered investment funds that fall within the scope of 
such section shall not be required to be filed with 
FINRA. 
(e) DEFINITIONS.—For purposes of this section: 
(1) The term ‘‘covered investment fund research 
report’’ means a research report published or distrib-
uted by a broker or dealer about a covered investment 
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fund or any securities issued by the covered invest-
ment fund, but not including a research report to the 
extent that it is published or distributed by the cov-
ered investment fund or any affiliate of the covered 
investment fund. 
(2) The term ‘‘covered investment fund’’ means— 
(A) an investment company registered 
under, or that has filed an election to be treated 
as a business development company under, the 
Investment Company Act of 1940 and that has 
filed a registration statement under the Securi-
ties Act of 1933 for the public offering of a class 
of its securities, which registration statement has 
been declared effective by the Commission; and 
(B) a trust or other person— 
(i) issuing securities in an offering 
registered under the Securities Act of 1933 
and which class of securities is listed for 
trading on a national securities exchange; 
(ii) the assets of which consist pri-
marily of commodities, currencies, or deriv-
ative instruments that reference commod-
ities or currencies, or interests in the fore-
going; and 
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(iii) that provides in its registration 
statement under the Securities Act of 1933 
that a class of its securities are purchased 
or redeemed, subject to conditions or limita-
tions, for a ratable share of its assets. 
(3) The term ‘‘FINRA’’ means the Financial In-
dustry Regulatory Authority. 
(4) The term ‘‘research report’’ has the meaning 
given that term under section 2(a)(3) of the Securities 
Act of 1933 (15 U.S.C. 77b(a)(3)), except that such 
term shall not include an oral communication. 
(5) The term ‘‘self-regulatory organization’’ has 
the meaning given to that term under section 3(a)(26) 
of the Securities Exchange Act of 1934 (15 U.S.C. 
78c(a)(26)). 
Subtitle F—Accelerating Access to 
Capital 
SEC. 426. EXPANDED ELIGIBILITY FOR USE OF FORM S–3. 
Not later than 45 days after the date of the enactment 
of this Act, the Securities and Exchange Commission shall 
revise Form S–3— 
(1) so as to permit securities to be registered 
pursuant to General Instruction I.B.1. of such form 
provided that either— 
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(A) the aggregate market value of the voting 
and non-voting common equity held by non-af-
filiates of the registrant is $75,000,000 or more; 
or 
(B) the registrant has at least one class of 
common equity securities listed and registered on 
a national securities exchange; and 
(2) so as to remove the requirement of paragraph 
(c) from General Instruction I.B.6. of such form. 
Subtitle G—Enhancing the RAISE 
Act 
SEC. 431. CERTAIN ACCREDITED INVESTOR TRANSACTIONS. 
Section 4 of the Securities Act of 1933 (15 U.S.C. 77d) 
is amended— 
(1) by amending subsection (d) to read as fol-
lows: 
‘‘(d)(1) The transactions referred to in subsection 
(a)(7) are transactions where— 
‘‘(A) each purchaser is an accredited inves-
tor, as that term is defined in section 230.501(a) 
of title 17, Code of Federal Regulations (or any 
successor thereto); and 
‘‘(B) if any securities sold in reliance on 
subsection (a)(7) are offered by means of any 
general solicitation or general advertising, all 
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such sales are made through a platform available 
only to accredited investors. 
‘‘(2) Securities sold in reliance on subsection (a)(7) 
shall be deemed to have been acquired in a transaction not 
involving any public offering. 
‘‘(3) The exemption provided by this subsection shall 
not be available for a transaction where the seller is— 
‘‘(A) an issuer, its subsidiaries or parent; 
‘‘(B) an underwriter acting on behalf of the 
issuer, its subsidiaries or parent, which receives com-
pensation from the issuer with respect to such sale; or 
‘‘(C) a dealer. 
‘‘(4) A transaction meeting the requirements of this 
subsection shall be deemed not to be a distribution for pur-
poses of section 2(a)(11).’’; and 
(2) by striking subsection (e). 
Subtitle H—Small Business Credit 
Availability 
SEC. 436. BUSINESS DEVELOPMENT COMPANY OWNERSHIP 
OF SECURITIES OF INVESTMENT ADVISERS 
AND CERTAIN FINANCIAL COMPANIES. 
(a) IN GENERAL.—Section 60 of the Investment Com-
pany Act of 1940 (15 U.S.C. 80a–59) is amended— 
(1) by striking ‘‘Notwithstanding’’ and inserting 
‘‘(a) Notwithstanding’’; 
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(2) by striking ‘‘except that the Commission shall 
not’’ and inserting the following: ‘‘except that— 
‘‘(1) section 12 shall not apply to the pur-
chasing, otherwise acquiring, or holding by a business 
development company of any security issued by, or 
any other interest in the business of, any person who 
is an investment adviser registered under title II of 
this Act, who is an investment adviser to an invest-
ment company, or who is an eligible portfolio com-
pany; and 
‘‘(2) the Commission shall not’’; 
(3) by adding at the end the following: 
‘‘(b) Nothing in this section shall prevent the Commis-
sion from issuing rules to address potential conflicts of in-
terest between business development companies and invest-
ment advisers.’’. 
(b) DEFINITION OF ELIGIBLE PORTFOLIO COMPANY.— 
Section 2(a)(46)(B) of the Investment Company Act of 1940 
(15 U.S.C. 80a–2(a)(46)(B)) is amended by inserting before 
the semicolon the following: ‘‘(unless it is described in para-
graph (2), (3), (4), (5), (6), or (9) of such section)’’. 
(c) INVESTMENT THRESHOLD.—Section 55(a) of the 
Investment Company Act of 1940 is amended by inserting 
before the colon the following: ‘‘, provided that no more than 
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50 percent of its total assets are assets described in section 
3(c)’’. 
SEC. 437. EXPANDING ACCESS TO CAPITAL FOR BUSINESS 
DEVELOPMENT COMPANIES. 
(a) IN GENERAL.—Section 61(a) of the Investment 
Company Act of 1940 (15 U.S.C. 80a–60(a)) is amended— 
(1) by redesignating paragraphs (2) through (4) 
as paragraphs (3) through (5), respectively; 
(2) by striking paragraph (1) and inserting the 
following: 
‘‘(1) Except as provided in paragraph (2), the 
asset coverage requirements of subparagraphs (A) and 
(B) of section 18(a)(1) (and any related rule promul-
gated under this Act) applicable to business develop-
ment companies shall be 200 percent. 
‘‘(2) The asset coverage requirements of subpara-
graphs (A) and (B) of section 18(a)(1) and of sub-
paragraphs (A) and (B) of section 18(a)(2) (and any 
related rule promulgated under this Act) applicable to 
a business development company shall be 150 percent 
if— 
‘‘(A) within five business days of the ap-
proval of the adoption of the asset coverage re-
quirements described in clause (ii), the business 
development company discloses such approval 
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and the date of its effectiveness in a Form 8–K 
filed with the Commission and in a notice on its 
website and discloses in its periodic filings made 
under section 13 of the Securities and Exchange 
Act of 1934 (15 U.S.C. 78m)— 
‘‘(i) the aggregate value of the senior 
securities issued by such company and the 
asset coverage percentage as of the date of 
such company’s most recent financial state-
ments; and 
‘‘(ii) that such company has adopted 
the asset coverage requirements of this sub-
paragraph and the effective date of such re-
quirements; 
‘‘(B) with respect to a business development 
company that issues equity securities that are 
registered on a national securities exchange, the 
periodic filings of the company under section 
13(a) of the Securities Exchange Act of 1934 (15 
U.S.C. 78m) include disclosures reasonably de-
signed to ensure that shareholders are informed 
of— 
‘‘(i) the amount of indebtedness and 
asset coverage ratio of the company, deter-
mined as of the date of the financial state-
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210 
ments of the company dated on or most re-
cently before the date of such filing; and 
‘‘(ii) the principal risk factors associ-
ated with such indebtedness, to the extent 
such risk is incurred by the company; and 
‘‘(C)(i) the application of this paragraph to 
the company is approved by the required major-
ity (as defined in section 57(o)) of the directors 
of or general partners of such company who are 
not interested persons of the business develop-
ment company, which application shall become 
effective on the date that is 1 year after the date 
of the approval, and, with respect to a business 
development company that issues equity securi-
ties that are not registered on a national securi-
ties exchange, the company extends, to each per-
son who is a shareholder as of the date of the ap-
proval, an offer to repurchase the equity securi-
ties held by such person as of such approval date, 
with 25 percent of such securities to be repur-
chased in each of the four quarters following such 
approval date; or 
‘‘(ii) the company obtains, at a special or 
annual meeting of shareholders or partners at 
which a quorum is present, the approval of more 
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than 50 percent of the votes cast of the applica-
tion of this paragraph to the company, which 
application shall become effective on the date im-
mediately after the date of the approval.’’; 
(3) in paragraph (3) (as redesignated), by in-
serting ‘‘or which is a stock’’ after ‘‘indebtedness’’; 
(4) in subparagraph (A) of paragraph (4) (as re-
designated)— 
(A) in the matter preceding clause (i), by 
striking ‘‘voting’’; and 
(B) by amending clause (iii) to read as fol-
lows: 
‘‘(iii) the exercise or conversion price 
at the date of issuance of such warrants, op-
tions, or rights is not less than— 
‘‘(I) the market value of the secu-
rities issuable upon the exercise of such 
warrants, options, or rights at the date 
of issuance of such warrants, options, 
or rights; or 
‘‘(II) if no such market value ex-
ists, the net asset value of the securities 
issuable upon the exercise of such war-
rants, options, or rights at the date of 
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issuance of such warrants, options, or 
rights; and’’; and 
(5) by adding at the end the following: 
‘‘(6)(A) Except as provided in subparagraph 
(B), the following shall not apply to a business devel-
opment company: 
‘‘(i) Subparagraphs (C) and (D) of section 
18(a)(2). 
‘‘(ii) Subparagraph (E) of section 18(a)(2), 
to the extent such subparagraph requires any 
priority over any other class of stock as to dis-
tribution of assets upon liquidation. 
‘‘(iii) With respect to a senior security 
which is a stock, subsections (c) and (i) of sec-
tion 18. 
‘‘(B) Subparagraph (A) shall not apply with re-
spect to preferred stock issued to a person who is not 
known by the company to be a qualified institutional 
buyer (as defined in section 3(a) of the Securities Ex-
change Act of 1934).’’. 
(b) CONFORMING
AMENDMENTS.—The Investment 
Company Act of 1940 (15 U.S.C. 80a–1 et seq.) is amend-
ed— 
(1) in section 57— 
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213 
(A) in subsection (j)(1), by striking ‘‘section 
61(a)(3)(B)’’ 
and 
inserting 
‘‘section 
61(a)(4)(B)’’; and 
(B) in subsection (n)(2), by striking ‘‘sec-
tion 
61(a)(3)(B)’’ 
and 
inserting 
‘‘section 
61(a)(4)(B)’’; and 
(2) in section 63(3), by striking ‘‘section 
61(a)(3)’’ and inserting ‘‘section 61(a)(4)’’. 
SEC. 438. PARITY FOR BUSINESS DEVELOPMENT COMPA-
NIES REGARDING OFFERING AND PROXY 
RULES. 
(a) REVISION TO RULES.—Not later than 1 year after 
the date of enactment of this Act, the Securities and Ex-
change Commission shall revise any rules to the extent nec-
essary to allow a business development company that has 
filed an election pursuant to section 54 of the Investment 
Company Act of 1940 (15 U.S.C. 80a–53) to use the securi-
ties offering and proxy rules that are available to other 
issuers that are required to file reports under section 13 
or section 15(d) of the Securities Exchange Act of 1934 (15 
U.S.C. 78m; 78o(d)). Any action that the Commission takes 
pursuant to this subsection shall include the following: 
(1) The Commission shall revise rule 405 under 
the Securities Act of 1933 (17 C.F.R. 230.405)— 
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214 
(A) to remove the exclusion of a business de-
velopment company from the definition of a 
well-known seasoned issuer provided by that rule; 
and 
(B) to add registration statements filed on 
Form N–2 to the definition of automatic shelf 
registration statement provided by that rule. 
(2) The Commission shall revise rules 168 and 
169 under the Securities Act of 1933 (17 C.F.R. 
230.168 and 230.169) to remove the exclusion of a 
business development company from an issuer that 
can use the exemptions provided by those rules. 
(3) The Commission shall revise rules 163 and 
163A under the Securities Act of 1933 (17 C.F.R. 
230.163 and 230.163A) to remove a business develop-
ment company from the list of issuers that are ineli-
gible to use the exemptions provided by those rules. 
(4) The Commission shall revise rule 134 under 
the Securities Act of 1933 (17 C.F.R. 230.134) to re-
move the exclusion of a business development com-
pany from that rule. 
(5) The Commission shall revise rules 138 and 
139 under the Securities Act of 1933 (17 C.F.R. 
230.138 and 230.139) to specifically include a busi-
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215 
ness development company as an issuer to which those 
rules apply. 
(6) The Commission shall revise rule 164 under 
the Securities Act of 1933 (17 C.F.R. 230.164) to re-
move a business development company from the list 
of issuers that are excluded from that rule. 
(7) The Commission shall revise rule 433 under 
the Securities Act of 1933 (17 C.F.R. 230.433) to spe-
cifically include a business development company that 
is a well-known seasoned issuer as an issuer to which 
that rule applies. 
(8) The Commission shall revise rule 415 under 
the Securities Act of 1933 (17 C.F.R. 230.415)— 
(A) to state that the registration for securi-
ties provided by that rule includes securities reg-
istered by a business development company on 
Form N–2; and 
(B) to provide an exception for a business 
development company from the requirement that 
a Form N–2 registrant must furnish the under-
takings required by item 34.4 of Form N–2. 
(9) The Commission shall revise rule 497 under 
the Securities Act of 1933 (17 C.F.R. 230.497) to in-
clude a process for a business development company 
to file a form of prospectus that is parallel to the 
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216 
process for filing a form of prospectus under rule 
424(b). 
(10) The Commission shall revise rules 172 and 
173 under the Securities Act of 1933 (17 C.F.R. 
230.172 and 230.173) to remove the exclusion of an 
offering of a business development company from 
those rules. 
(11) The Commission shall revise rule 418 under 
the Securities Act of 1933 (17 C.F.R. 230.418) to pro-
vide that a business development company that would 
otherwise meet the eligibility requirements of General 
Instruction I.A of Form S–3 shall be exempt from 
paragraph (a)(3) of that rule. 
(12) The Commission shall revise rule 14a–101 
under the Securities Exchange Act of 1934 (17 C.F.R. 
240.14a–101) to provide that a business development 
company that would otherwise meet the requirements 
of General Instruction I.A of Form S–3 shall be 
deemed to meet the requirements of Form S–3 for 
purposes of Schedule 14A. 
(13) The Commission shall revise rule 103 under 
Regulation FD (17 C.F.R. 243.103) to provide that 
paragraph (a) of that rule applies for purposes of 
Form N–2. 
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(b) REVISION TO FORM N–2.—Not later than 1 year 
after the date of enactment of this Act, the Commission shall 
revise Form N–2— 
(1) to include an item or instruction that is 
similar to item 12 on Form S–3 to provide that a 
business development company that would otherwise 
meet the requirements of Form S–3 shall incorporate 
by reference its reports and documents filed under the 
Securities Exchange Act of 1934 into its registration 
statement filed on Form N–2; and 
(2) to include an item or instruction that is 
similar to the instruction regarding automatic shelf 
offerings by well-known seasoned issuers on Form S– 
3 to provide that a business development company 
that is a well-known seasoned issuer may file auto-
matic shelf offerings on Form N–2. 
(c) TREATMENT IF REVISIONS NOT COMPLETED IN 
TIMELY MANNER.—If the Commission fails to complete the 
revisions required by subsections (a) and (b) by the time 
required by such subsections, a business development com-
pany shall be entitled to treat such revisions as having been 
completed in accordance with the actions required to be 
taken by the Commission by such subsections until such 
time as such revisions are completed by the Commission. 
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(d) RULE OF CONSTRUCTION.—Any reference in this 
section to a rule or form means such rule or form or any 
successor rule or form. 
Subtitle I—Fostering Innovation 
SEC. 441. TEMPORARY EXEMPTION FOR LOW-REVENUE 
ISSUERS. 
Section 404 of the Sarbanes-Oxley Act of 2002 (15 
U.S.C. 7262) is amended by adding at the end the following: 
‘‘(d) TEMPORARY EXEMPTION
FOR LOW-REVENUE 
ISSUERS.— 
‘‘(1) LOW-REVENUE EXEMPTION.—Subsection (b) 
shall not apply with respect to an audit report pre-
pared for an issuer that— 
‘‘(A) ceased to be an emerging growth com-
pany on the last day of the fiscal year of the 
issuer following the fifth anniversary of the date 
of the first sale of common equity securities of 
the issuer pursuant to an effective registration 
statement under the Securities Act of 1933; 
‘‘(B) had average annual gross revenues of 
less than $50,000,000 as of its most recently 
completed fiscal year; and 
‘‘(C) is not a large accelerated filer. 
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‘‘(2) EXPIRATION OF TEMPORARY EXEMPTION.— 
An issuer ceases to be eligible for the exemption de-
scribed under paragraph (1) at the earliest of— 
‘‘(A) the last day of the fiscal year of the 
issuer following the tenth anniversary of the date 
of the first sale of common equity securities of 
the issuer pursuant to an effective registration 
statement under the Securities Act of 1933; 
‘‘(B) the last day of the fiscal year of the 
issuer during which the average annual gross 
revenues of the issuer exceed $50,000,000; or 
‘‘(C) the date on which the issuer becomes a 
large accelerated filer. 
‘‘(3) DEFINITIONS.—For purposes of this sub-
section: 
‘‘(A) 
AVERAGE
ANNUAL
GROSS
REVE-
NUES.—The term ‘average annual gross revenues’ 
means the total gross revenues of an issuer over 
its most recently completed three fiscal years di-
vided by three. 
‘‘(B) EMERGING
GROWTH
COMPANY.—The 
term ‘emerging growth company’ has the mean-
ing given such term under section 3 of the Secu-
rities Exchange Act of 1934 (15 U.S.C. 78c). 
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‘‘(C) LARGE
ACCELERATED
FILER.—The 
term ‘large accelerated filer’ has the meaning 
given that term under section 240.12b–2 of title 
17, Code of Federal Regulations, or any successor 
thereto.’’. 
Subtitle J—Small Business Capital 
Formation Enhancement 
SEC. 446. ANNUAL REVIEW OF GOVERNMENT-BUSINESS 
FORUM ON CAPITAL FORMATION. 
Section 503 of the Small Business Investment Incen-
tive Act of 1980 (15 U.S.C. 80c–1) is amended by adding 
at the end the following: 
‘‘(e) The Commission shall— 
‘‘(1) review the findings and recommendations of 
the forum; and 
‘‘(2) each time the forum submits a finding or 
recommendation to the Commission, promptly issue a 
public statement— 
‘‘(A) assessing the finding or recommenda-
tion of the forum; and 
‘‘(B) disclosing the action, if any, the Com-
mission intends to take with respect to the find-
ing or recommendation.’’. 
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221 
Subtitle K—Helping Angels Lead 
Our Startups 
SEC. 451. DEFINITION OF ANGEL INVESTOR GROUP. 
As used in this subtitle, the term ‘‘angel investor 
group’’ means any group that— 
(1) is composed of accredited investors interested 
in investing personal capital in early-stage compa-
nies; 
(2) holds regular meetings and has defined proc-
esses and procedures for making investment decisions, 
either individually or among the membership of the 
group as a whole; and 
(3) is neither associated nor affiliated with bro-
kers, dealers, or investment advisers. 
SEC. 452. CLARIFICATION OF GENERAL SOLICITATION. 
(a) IN GENERAL.—Not later than 6 months after the 
date of enactment of this Act, the Securities and Exchange 
Commission shall revise Regulation D of its rules (17 
C.F.R. 230.500 et seq.) to require that in carrying out the 
prohibition against general solicitation or general adver-
tising contained in section 230.502(c) of title 17, Code of 
Federal Regulations, the prohibition shall not apply to a 
presentation or other communication made by or on behalf 
of an issuer which is made at an event— 
(1) sponsored by— 
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(A) the United States or any territory 
thereof, by the District of Columbia, by any 
State, by a political subdivision of any State or 
territory, or by any agency or public instrumen-
tality of any of the foregoing; 
(B) a college, university, or other institu-
tion of higher education; 
(C) a nonprofit organization; 
(D) an angel investor group; 
(E) a venture forum, venture capital asso-
ciation, or trade association; or 
(F) any other group, person or entity as the 
Securities and Exchange Commission may deter-
mine by rule; 
(2) where any advertising for the event does not 
reference any specific offering of securities by the 
issuer; 
(3) the sponsor of which— 
(A) does not make investment recommenda-
tions or provide investment advice to event 
attendees; 
(B) does not engage in an active role in any 
investment negotiations between the issuer and 
investors attending the event; 
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223 
(C) does not charge event attendees any fees 
other than administrative fees; and 
(D) does not receive any compensation with 
respect to such event that would require registra-
tion of the sponsor as a broker or a dealer under 
the Securities Exchange Act of 1934, or as an in-
vestment advisor under the Investment Advisers 
Act of 1940; and 
(4) where no specific information regarding an 
offering of securities by the issuer is communicated or 
distributed by or on behalf of the issuer, other than— 
(A) that the issuer is in the process of offer-
ing securities or planning to offer securities; 
(B) the type and amount of securities being 
offered; 
(C) the amount of securities being offered 
that have already been subscribed for; and 
(D) the intended use of proceeds of the offer-
ing. 
(b) RULE OF CONSTRUCTION.—Subsection (a) may 
only be construed as requiring the Securities and Exchange 
Commission to amend the requirements of Regulation D 
with respect to presentations and communications, and not 
with respect to purchases or sales. 
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Subtitle L—Main Street Growth 
SEC. 456. VENTURE EXCHANGES. 
(a) SECURITIES EXCHANGE ACT OF 1934.—Section 6 
of the Securities Exchange Act of 1934 (15 U.S.C. 78f) is 
amended by adding at the end the following: 
‘‘(m) VENTURE EXCHANGE.— 
‘‘(1) REGISTRATION.— 
‘‘(A) IN
GENERAL.—A national securities 
exchange may elect to be treated (or for a listing 
tier of such exchange to be treated) as a venture 
exchange by notifying the Commission of such 
election, either at the time the exchange applies 
to be registered as a national securities exchange 
or after registering as a national securities ex-
change. 
‘‘(B) DETERMINATION TIME PERIOD.—With 
respect to a securities exchange electing to be 
treated (or for a listing tier of such exchange to 
be treated) as a venture exchange— 
‘‘(i) at the time the exchange applies to 
be registered as a national securities ex-
change, such application and election shall 
be deemed to have been approved by the 
Commission unless the Commission denies 
such application before the end of the 6- 
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225 
month period beginning on the date the 
Commission received such application; and 
‘‘(ii) after registering as a national se-
curities exchange, such election shall be 
deemed to have been approved by the Com-
mission unless the Commission denies such 
approval before the end of the 6-month pe-
riod beginning on the date the Commission 
received notification of such election. 
‘‘(2) POWERS
AND
RESTRICTIONS.—A venture 
exchange— 
‘‘(A) may only constitute, maintain, or pro-
vide a market place or facilities for bringing to-
gether purchasers and sellers of venture securi-
ties; 
‘‘(B) may determine the increment to be 
used for quoting and trading venture securities 
on the exchange; 
‘‘(C) 
shall 
disseminate 
last 
sale 
and 
quotation information on terms that are fair 
and reasonable and not unreasonably discrimi-
natory; 
‘‘(D) may choose to carry out periodic auc-
tions for the sale of a venture security instead of 
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226 
providing continuous trading of the venture se-
curity; and 
‘‘(E) may not extend unlisted trading privi-
leges to any venture security. 
‘‘(3) EXEMPTIONS FROM CERTAIN NATIONAL SE-
CURITY
EXCHANGE
REGULATIONS.—A venture ex-
change shall not be required to— 
‘‘(A) comply with any of sections 242.600 
through 242.612 of title 17, Code of Federal Reg-
ulations; 
‘‘(B) comply with any of sections 242.300 
through 242.303 of title 17, Code of Federal Reg-
ulations; 
‘‘(C) submit any data to a securities infor-
mation processor; or 
‘‘(D) use decimal pricing. 
‘‘(4) TREATMENT OF CERTAIN EXEMPTED SECU-
RITIES.—A security that is exempt from registration 
pursuant to section 3(b) of the Securities Act of 1933 
shall be exempt from section 12(a) of this title with 
respect to the trading of such security on a venture 
exchange, if the issuer of such security is in compli-
ance with all disclosure obligations of such section 
3(b) and the regulations issued under such section. 
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‘‘(5) DEFINITIONS.—For purposes of this sub-
section: 
‘‘(A) EARLY-STAGE, GROWTH COMPANY.— 
‘‘(i) IN
GENERAL.—The term ‘early- 
stage, growth company’ means an issuer— 
‘‘(I) that has not made an initial 
public offering of any securities of the 
issuer; and 
‘‘(II) with a market capitalization 
of $1,000,000,000 (as such amount is 
indexed for inflation every 5 years by 
the Commission to reflect the change in 
the Consumer Price Index for All 
Urban Consumers published by the Bu-
reau of Labor Statistics, setting the 
threshold to the nearest $1,000,000) or 
less. 
‘‘(ii) TREATMENT WHEN MARKET CAP-
ITALIZATION EXCEEDS THRESHOLD.— 
‘‘(I) IN GENERAL.—In the case of 
an issuer that is an early-stage, growth 
company the securities of which are 
traded on a venture exchange, such 
issuer shall not cease to be an early- 
stage, growth company by reason of the 
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market capitalization of such issuer ex-
ceeding the threshold specified in clause 
(i)(II) until the end of the period of 24 
consecutive months during which the 
market capitalization of such issuer ex-
ceeds $2,000,000,000 (as such amount 
is indexed for inflation every 5 years 
by the Commission to reflect the change 
in the Consumer Price Index for All 
Urban Consumers published by the Bu-
reau of Labor Statistics, setting the 
threshold to the nearest $1,000,000). 
‘‘(II) EXEMPTIONS.—If an issuer 
would cease to be an early-stage, 
growth company under subclause (I), 
the venture exchange may, at the re-
quest of the issuer, exempt the issuer 
from the market capitalization require-
ments of this subparagraph for the 1- 
year period that begins on the day 
after the end of the 24-month period 
described in such subclause. The ven-
ture exchange may, at the request of 
the issuer, extend the exemption for 1 
additional year. 
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229 
‘‘(B) VENTURE SECURITY.—The term ‘ven-
ture security’ means— 
‘‘(i) securities of an early-stage, growth 
company that are exempt from registration 
pursuant to section 3(b) of the Securities 
Act of 1933; and 
‘‘(ii) securities of an emerging growth 
company.’’. 
(b) SECURITIES ACT OF 1933.—Section 18(b)(1) of the 
Securities Act of 1933 (15 U.S.C. 77r(b)(1)) is amended— 
(1) in subparagraph (B), by striking ‘‘or’’ at the 
end; 
(2) in subparagraph (C), by striking the period 
and inserting ‘‘; or’’; and 
(3) by adding at the end the following: 
‘‘(D) a venture security, as defined under 
section 6(m)(5) of the Securities Exchange Act of 
1934.’’. 
(c) SENSE OF CONGRESS.—It is the sense of the Con-
gress that the Securities and Exchange Commission 
should— 
(1) when necessary or appropriate in the public 
interest and consistent with the protection of inves-
tors, make use of the Commission’s general exemptive 
authority under section 36 of the Securities Exchange 
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Act of 1934 (15 U.S.C. 78mm) with respect to the 
provisions added by this section; and 
(2) if the Commission determines appropriate, 
create an Office of Venture Exchanges within the 
Commission’s Division of Trading and Markets. 
(d) RULE OF CONSTRUCTION.—Nothing in this section 
or the amendments made by this section shall be construed 
to impair or limit the construction of the antifraud provi-
sions of the securities laws (as defined in section 3(a) of 
the Securities Exchange Act of 1934 (15 U.S.C. 78c(a))) 
or the authority of the Securities and Exchange Commis-
sion under those provisions. 
(e) EFFECTIVE DATE FOR TIERS OF EXISTING NA-
TIONAL SECURITIES EXCHANGES.—In the case of a securi-
ties exchange that is registered as a national securities ex-
change under section 6 of the Securities Exchange Act of 
1934 (15 U.S.C. 78f) on the date of the enactment of this 
Act, any election for a listing tier of such exchange to be 
treated as a venture exchange under subsection (m) of such 
section shall not take effect before the date that is 180 days 
after such date of enactment. 
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Subtitle M—Micro Offering Safe 
Harbor 
SEC. 461. EXEMPTIONS FOR MICRO-OFFERINGS. 
(a) IN GENERAL.—Section 4 of the Securities Act of 
1933 (15 U.S.C. 77d) is amended— 
(1) in subsection (a), by adding at the end the 
following: 
‘‘(8) transactions meeting the requirements of 
subsection (e).’’; and 
(2) as amended by section 434(2), by adding at 
the end the following: 
‘‘(e) CERTAIN MICRO-OFFERINGS.—The transactions 
referred to in subsection (a)(8) are transactions involving 
the sale of securities by an issuer (including all entities con-
trolled by or under common control with the issuer) that 
meet all of the following requirements: 
‘‘(1) PRE-EXISTING RELATIONSHIP.—Each pur-
chaser has a substantive pre-existing relationship 
with an officer of the issuer, a director of the issuer, 
or a shareholder holding 10 percent or more of the 
shares of the issuer. 
‘‘(2) 35 OR FEWER PURCHASERS.—There are no 
more than, or the issuer reasonably believes that there 
are no more than, 35 purchasers of securities from the 
issuer that are sold in reliance on the exemption pro-
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232 
vided under subsection (a)(8) during the 12-month 
period preceding such transaction. 
‘‘(3) SMALL OFFERING AMOUNT.—The aggregate 
amount of all securities sold by the issuer, including 
any amount sold in reliance on the exemption pro-
vided under subsection (a)(8), during the 12-month 
period preceding such transaction, does not exceed 
$500,000.’’. 
(b) EXEMPTION UNDER STATE REGULATIONS.—Sec-
tion 18(b)(4) of the Securities Act of 1933 (15 U.S.C. 
77r(b)(4)) is amended— 
(1) in subparagraph (F), by striking ‘‘or’’ at the 
end; 
(2) in subparagraph (G), by striking the period 
and inserting ‘‘; or’’; and 
(3) by adding at the end the following: 
‘‘(H) section 4(a)(8).’’. 
Subtitle N—Private Placement 
Improvement 
SEC. 466. REVISIONS TO SEC REGULATION D. 
Not later than 45 days following the date of the enact-
ment of this Act, the Securities and Exchange Commission 
shall revise Regulation D (17 C.F.R. 501 et seq.) in accord-
ance with the following: 
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233 
(1) The Commission shall revise Form D filing 
requirements to require an issuer offering or selling 
securities in reliance on an exemption provided under 
Rule 506 of Regulation D to file with the Commission 
a single notice of sales containing the information re-
quired by Form D for each new offering of securities 
no earlier than 15 days after the date of the first sale 
of securities in the offering. The Commission shall not 
require such an issuer to file any notice of sales con-
taining the information required by Form D except 
for the single notice described in the previous sen-
tence. 
(2) The Commission shall make the information 
contained in each Form D filing available to the secu-
rities commission (or any agency or office performing 
like functions) of each State and territory of the 
United States and the District of Columbia. 
(3) The Commission shall not condition the 
availability of any exemption for an issuer under 
Rule 506 of Regulation D (17 C.F.R. 230.506) on the 
issuer’s or any other person’s filing with the Commis-
sion of a Form D or any similar report. 
(4) The Commission shall not require issuers to 
submit written general solicitation materials to the 
Commission in connection with a Rule 506(c) offer-
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234 
ing, except when the Commission requests such mate-
rials pursuant to the Commission’s authority under 
section 8A or section 20 of the Securities Act of 1933 
(15 U.S.C. 77h–1 or 77t) or section 9, 10(b), 21A, 
21B, or 21C of the Securities Exchange Act of 1934 
(15 U.S.C. 78i, 78j(b), 78u–1, 78u–2, or 78u–3). 
(5) The Commission shall not extend the require-
ments contained in Rule 156 to private funds. 
(6) The Commission shall revise Rule 501(a) of 
Regulation D to provide that a person who is a 
‘‘knowledgeable employee’’ of a private fund or the 
fund’s investment adviser, as defined in Rule 3c– 
5(a)(4) (17 C.F.R. 270.3c–5(a)(4)), shall be an ac-
credited investor for purposes of a Rule 506 offering 
of a private fund with respect to which the person is 
a knowledgeable employee. 
Subtitle O—Supporting America’s 
Innovators 
SEC. 471. INVESTOR LIMITATION FOR QUALIFYING VEN-
TURE CAPITAL FUNDS. 
Section 3(c)(1) of the Investment Company Act of 1940 
(15 U.S.C. 80a–3(c)(1)) is amended— 
(1) by inserting after ‘‘one hundred persons’’ the 
following: ‘‘(or, with respect to a qualifying venture 
capital fund, 500 persons)’’; and 
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(2) by adding at the end the following: 
‘‘(C) The term ‘qualifying venture capital 
fund’ means any venture capital fund (as de-
fined pursuant to section 203(l)(1) of the Invest-
ment Advisers Act of 1940 (15 U.S.C. 80b– 
3(l)(1)) with no more than $50,000,000 in aggre-
gate capital contributions and uncalled com-
mitted capital, as such dollar amount is annu-
ally adjusted by the Commission to reflect the 
change in the Consumer Price Index for All 
Urban Consumers published by the Bureau of 
Labor Statistics of the Department of Labor.’’. 
Subtitle P—Fix Crowdfunding 
SEC. 476. CROWDFUNDING EXEMPTION. 
(a) SECURITIES ACT OF 1933.—Section 4(a) of the Se-
curities Act of 1933 (15 U.S.C. 77d) is amended by striking 
paragraph (6) and inserting the following: 
‘‘(6) transactions involving the offer or sale of se-
curities by an issuer, provided that— 
‘‘(A) in the case of a transaction involving 
an intermediary between the issuer and the in-
vestor, such intermediary complies with the re-
quirements under section 4A(a); and 
‘‘(B) in the case of a transaction not involv-
ing an intermediary between the issuer and the 
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236 
investor, the issuer complies with the require-
ments under section 4A(b).’’. 
(b) REQUIREMENTS TO QUALIFY FOR CROWDFUNDING 
EXEMPTION.—Section 4A of the Securities Act of 1933 (15 
U.S.C. 77d–1) is amended to read as follows: 
‘‘SEC. 4A. REQUIREMENTS WITH RESPECT TO CERTAIN 
SMALL TRANSACTIONS. 
‘‘(a) REQUIREMENTS ON INTERMEDIARIES.—For pur-
poses of section 4(a)(6), a person acting as an intermediary 
in a transaction involving the offer or sale of securities shall 
comply with the requirements of this subsection if the inter-
mediary— 
‘‘(1) 
warns 
investors, 
including 
on 
the 
intermediary’s website used for the offer and sale of 
such securities, of the speculative nature generally ap-
plicable to investments in startups, emerging busi-
nesses, and small issuers, including risks in the sec-
ondary market related to illiquidity; 
‘‘(2) warns investors that they are subject to the 
restriction on sales requirement described under sub-
section (e); 
‘‘(3) takes reasonable measures to reduce the risk 
of fraud with respect to such transaction; 
‘‘(4) registers with the Commission and the Fi-
nancial Industry Regulatory Authority, including by 
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providing the Commission with the intermediary’s 
physical address, website address, and the names of 
the intermediary and employees of the intermediary, 
and keep such information up-to-date; 
‘‘(5) provides the Commission with continuous 
investor-level access to the intermediary’s website; 
‘‘(6) requires each potential investor to answer 
questions demonstrating— 
‘‘(A) an understanding of the level of risk 
generally applicable to investments in startups, 
emerging businesses, and small issuers; 
‘‘(B) an understanding of the risk of 
illiquidity; and 
‘‘(C) such other areas as the Commission 
may determine appropriate by rule or regula-
tion, including information relating to the own-
ers’ and management’s experience, and any re-
lated party transactions and conflicts of interest; 
‘‘(7) carries out a background check on the 
issuer’s principals; 
‘‘(8) provides the Commission and potential in-
vestors with notice of the offering not less than 10 
days prior to such offering, not later than the first 
day securities are offered to potential investors, in-
cluding— 
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‘‘(A) the issuer’s name, legal status, phys-
ical address, and website address; 
‘‘(B) the names of the issuer’s principals; 
‘‘(C) the stated purpose and intended use of 
the proceeds of the offering sought by the issuer; 
and 
‘‘(D) the target offering amount and the 
deadline to reach the target offering amount; 
‘‘(9) outsources cash-management functions to a 
qualified third party custodian, such as a broker or 
dealer registered under section 15(b)(1) of the Securi-
ties Exchange Act of 1934, a trust company, or an in-
sured depository institution; 
‘‘(10) makes available on the intermediary’s 
website a method of communication that permits the 
issuer and investors to communicate with one an-
other; 
‘‘(11) provides the Commission with a notice 
upon completion of the offering, which shall include 
the aggregate offering amount and the number of pur-
chasers; and 
‘‘(b) REQUIREMENTS
ON ISSUERS
IF NO INTER-
MEDIARY.—For purposes of section 4(a)(6), an issuer who 
offers or sells securities without an intermediary shall com-
ply with the requirements of this subsection if the issuer— 
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‘‘(1) warns investors, including on the issuer’s 
website, of the speculative nature generally applicable 
to investments in startups, emerging businesses, and 
small issuers, including risks in the secondary market 
related to illiquidity; 
‘‘(2) warns investors that they are subject to the 
restriction on sales requirement described under sub-
section (e); 
‘‘(3) takes reasonable measures to reduce the risk 
of fraud with respect to such transaction; 
‘‘(4) provides the Commission with the issuer’s 
physical address, website address, and the names of 
the principals and employees of the issuers, and keeps 
such information up-to-date; 
‘‘(5) provides the Commission with continuous 
investor-level access to the issuer’s website; 
‘‘(6) requires each potential investor to answer 
questions demonstrating— 
‘‘(A) an understanding of the level of risk 
generally applicable to investments in startups, 
emerging businesses, and small issuers; 
‘‘(B) an understanding of the risk of 
illiquidity; and 
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‘‘(C) such other areas as the Commission 
may determine appropriate by rule or regula-
tion; 
‘‘(7) provides the Commission with notice of the 
offering not less than 10 days prior to such offering, 
not later than the first day securities are offered to 
potential investors, including— 
‘‘(A) the stated purpose and intended use of 
the proceeds of the offering sought by the issuer; 
and 
‘‘(B) the target offering amount and the 
deadline to reach the target offering amount; 
‘‘(8) outsources cash-management functions to a 
qualified third party custodian, such as a broker or 
dealer registered under section 15(b)(1) of the Securi-
ties Exchange Act of 1934, a trust company, or an in-
sured depository institution; 
‘‘(9) makes available on the issuer’s website a 
method of communication that permits the issuer and 
investors to communicate with one another; 
‘‘(10) does not offer personalized investment ad-
vice; 
‘‘(11) provides the Commission with a notice 
upon completion of the offering, which shall include 
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241 
the aggregate offering amount and the number of pur-
chasers; and 
‘‘(c) VERIFICATION OF INCOME.—For purposes of sec-
tion 4(a)(6), an issuer or intermediary may rely on certifi-
cations as to annual income provided by the person to 
whom the securities are sold to verify the investor’s income. 
‘‘(d) INFORMATION AVAILABLE TO STATES.—The Com-
mission shall make the notices described under subsections 
(a)(9), (a)(13), (b)(8), and (b)(13) and the information de-
scribed under subsections (a)(4) and (b)(4) available to the 
States. 
‘‘(e) RESTRICTION
ON SALES.—With respect to a 
transaction involving the issuance of securities described 
under section 4(a)(6), a purchaser may not transfer such 
securities during the 1-year period beginning on the date 
of purchase, unless such securities are sold to— 
‘‘(1) the issuer of such securities; or 
‘‘(2) an accredited investor. 
‘‘(f) CONSTRUCTION.— 
‘‘(1) NO REGISTRATION AS BROKER.—With re-
spect to a transaction described under section 4(a)(6) 
involving an intermediary, such intermediary shall 
not be required to register as a broker under section 
15(a)(1) of the Securities Exchange Act of 1934 solely 
by reason of participation in such transaction. 
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‘‘(2) NO PRECLUSION OF OTHER CAPITAL RAIS-
ING.—Nothing in this section or section 4(a)(6) shall 
be construed as preventing an issuer from raising 
capital through methods not described under section 
4(a)(6).’’. 
(c) RULEMAKING.—Not later than 180 days after the 
date of enactment of this Act, the Securities and Exchange 
Commission shall issue or revise such rules as may be nec-
essary to carry out section 4A of the Securities Act of 1933, 
ans amended by this Act. In issuing or revising such rules, 
the Commission shall consider the costs and benefits of the 
action. 
(d) DISQUALIFICATION.—Not later than 180 days after 
the date of enactment of this Act, the Securities and Ex-
change Commission shall by rule or regulation establish dis-
qualification provisions under which an issuer shall not be 
eligible to utilize the exemption under section 4(a)(6) of the 
Securities Act of 1933 (as amended by this Act) based on 
the disciplinary history of the issuer or its predecessors, af-
filiates, officers, directors, or persons fulfilling similar roles. 
The Commission shall also establish disqualification provi-
sions under which an intermediary shall not be eligible to 
act as an intermediary in connection with an offering uti-
lizing the exemption under section 4(a)(6) of the Securities 
Act of 1933 based on the disciplinary history of the inter-
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mediary or its predecessors, affiliates, officers, directors, or 
persons fulfilling similar roles. Such provisions shall be 
substantially similar to the disqualification provisions con-
tained in the regulations adopted in accordance with sec-
tion 926 of the Dodd-Frank Wall Street Reform and Con-
sumer Protection Act (15 U.S.C. 77d note). 
SEC. 477. EXCLUSION OF CROWDFUNDING INVESTORS 
FROM SHAREHOLDER CAP. 
Section 12(g)(5) of the Securities Exchange Act of 
1934 (15 U.S.C. 78l(g)(5)) is amended— 
(1) by striking ‘‘(5) For the purposes’’ and in-
serting: 
‘‘(5) DEFINITIONS.— 
‘‘(A) IN GENERAL.—For the purposes’’; and 
(2) by adding at the end the following: 
‘‘(B) EXCLUSION
FOR
PERSONS
HOLDING 
CERTAIN SECURITIES.—For purposes of this sub-
section, securities held by persons who purchase 
such securities in transactions described under 
section 4(a)(6) of the Securities Act of 1933 shall 
not be deemed to be ‘held of record’.’’. 
SEC. 478. PREEMPTION OF STATE LAW. 
(a) IN GENERAL.—Section 18(b)(4)(C) of the Securi-
ties Act of 1933 (15 U.S.C. 77r(b)(4)(C)) is amended by 
striking ‘‘section 4(6)’’ and inserting ‘‘section 4(a)(6)’’. 
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244 
(b) CLARIFICATION OF THE PRESERVATION OF STATE 
ENFORCEMENT AUTHORITY.— 
(1) IN
GENERAL.—The amendments made by 
subsection (a) relate solely to State registration, docu-
mentation, and offering requirements, as described 
under section 18(a) of Securities Act of 1933 (15 
U.S.C. 77r(a)), and shall have no impact or limita-
tion on other State authority to take enforcement ac-
tion with regard to an issuer, intermediary, or any 
other person or entity using the exemption from reg-
istration provided by section 4(a)(6) of such Act, ex-
cept that a State may not impose any fees under such 
authority. 
(2) CLARIFICATION
OF
STATE
JURISDICTION 
OVER
UNLAWFUL
CONDUCT
OF
INTERMEDIARIES, 
ISSUERS, AND CUSTODIANS.—Section 18(c)(1) of the 
Securities Act of 1933 is amended by striking ‘‘in 
connection with securities or securities transactions’’ 
and all that follows and inserting the following: ‘‘, in 
connection with securities or securities transactions, 
with respect to— 
‘‘(A) fraud or deceit; 
‘‘(B) unlawful conduct by a broker or deal-
er; and 
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‘‘(C) with respect to a transaction described 
under section 4(a)(6), unlawful conduct by an 
intermediary, issuer, or custodian.’’. 
SEC. 479. TREATMENT OF FUNDING PORTALS. 
Section 5312(c) of title 31, United States Code, is 
amended by adding at the end the following: 
‘‘(2) FUNDING PORTALS NOT INCLUDED IN DEFI-
NITION.—The term ‘financial institution’ (as defined 
in subsection (a)) does not include a funding portal 
(as defined under section 3(a) of the Securities Ex-
change Act of 1934 (15 U.S.C. 78c(a))).’’. 
Subtitle Q—Corporate Governance 
Reform and Transparency 
SEC. 481. DEFINITIONS. 
(a) SECURITIES EXCHANGE ACT OF 1934.—Section 
3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 
78c(a)) is amended by adding at the end the following new 
paragraphs: 
‘‘(83) PROXY ADVISORY FIRM.—The term ‘proxy 
advisory firm’ means any person who is primarily 
engaged in the business of providing proxy voting re-
search, analysis, or recommendations to clients, which 
conduct constitutes a solicitation within the meaning 
of section 14 and the Commission’s rules and regula-
tions thereunder, except to the extent that the person 
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246 
is exempted by such rules and regulations from re-
quirements otherwise applicable to persons engaged in 
a solicitation. 
‘‘(84) PERSON ASSOCIATED WITH A PROXY ADVI-
SORY
FIRM.—The term ‘person associated with’ a 
proxy advisory firm means any partner, officer, or 
director of a proxy advisory firm (or any person oc-
cupying a similar status or performing similar func-
tions), any person directly or indirectly controlling, 
controlled by, or under common control with a proxy 
advisory firm, or any employee of a proxy advisory 
firm, except that persons associated with a proxy ad-
visory firm whose functions are clerical or ministerial 
shall not be included in the meaning of such term. 
The Commission may by rules and regulations clas-
sify, for purposes or any portion or portions of this 
Act, persons, including employees controlled by a 
proxy advisory firm.’’. 
(b) APPLICABLE DEFINITIONS.—As used in this sub-
title— 
(1) the term ‘‘Commission’’ means the Securities 
and Exchange Commission; and 
(2) the term ‘‘proxy advisory firm’’ has the same 
meaning as in section 3(a)(83) of the Securities Ex-
change Act of 1934, as added by this subtitle. 
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247 
SEC. 482. REGISTRATION OF PROXY ADVISORY FIRMS. 
(a) AMENDMENT.—The Securities Exchange Act of 
1934 is amended by inserting after section 15G the fol-
lowing new section: 
‘‘SEC. 15H. REGISTRATION OF PROXY ADVISORY FIRMS. 
‘‘(a) CONDUCT PROHIBITED.—It shall be unlawful for 
a proxy advisory firm to make use of the mails or any 
means or instrumentality of interstate commerce to provide 
proxy voting research, analysis, or recommendations to any 
client, unless such proxy advisory firm is registered under 
this section. 
‘‘(b) REGISTRATION PROCEDURES.— 
‘‘(1) APPLICATION FOR REGISTRATION.— 
‘‘(A) IN GENERAL.—A proxy advisory firm 
must file with the Commission an application 
for registration, in such form as the Commission 
shall require, by rule or regulation, and con-
taining the information described in subpara-
graph (B). 
‘‘(B) REQUIRED INFORMATION.—An appli-
cation for registration under this section shall 
contain information regarding— 
‘‘(i) a certification that the applicant 
has adequate financial and managerial re-
sources to consistently provide proxy advice 
based on accurate information; 
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‘‘(ii) the procedures and methodologies 
that the applicant uses in developing proxy 
voting recommendations, including whether 
and how the applicant considers the size of 
a company when making proxy voting rec-
ommendations; 
‘‘(iii) the organizational structure of 
the applicant; 
‘‘(iv) whether or not the applicant has 
in effect a code of ethics, and if not, the rea-
sons therefor; 
‘‘(v) any potential or actual conflict of 
interest relating to the ownership structure 
of the applicant or the provision of proxy 
advisory services by the applicant, includ-
ing whether the proxy advisory firm en-
gages in services ancillary to the provision 
of proxy advisory services such as con-
sulting services for corporate issuers, and if 
so the revenues derived therefrom; 
‘‘(vi) the policies and procedures in 
place to manage conflicts of interest under 
subsection (f); and 
‘‘(vii) any other information and docu-
ments concerning the applicant and any 
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249 
person associated with such applicant as the 
Commission, by rule, may prescribe as nec-
essary or appropriate in the public interest 
or for the protection of investors. 
‘‘(2) REVIEW OF APPLICATION.— 
‘‘(A) INITIAL
DETERMINATION.—Not later 
than 90 days after the date on which the appli-
cation for registration is filed with the Commis-
sion under paragraph (1) (or within such longer 
period as to which the applicant consents) the 
Commission shall— 
‘‘(i) by order, grant registration; or 
‘‘(ii) institute proceedings to determine 
whether registration should be denied. 
‘‘(B) CONDUCT OF PROCEEDINGS.— 
‘‘(i) CONTENT.—Proceedings referred to 
in subparagraph (A)(ii) shall— 
‘‘(I) include notice of the grounds 
for denial under consideration and an 
opportunity for hearing; and 
‘‘(II) be concluded not later than 
120 days after the date on which the 
application for registration is filed 
with the Commission under paragraph 
(1). 
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‘‘(ii) DETERMINATION.—At the conclu-
sion of such proceedings, the Commission, 
by order, shall grant or deny such applica-
tion for registration. 
‘‘(iii) EXTENSION
AUTHORIZED.—The 
Commission may extend the time for con-
clusion of such proceedings for not longer 
than 90 days, if it finds good cause for such 
extension and publishes its reasons for so 
finding, or for such longer period as to 
which the applicant consents. 
‘‘(C) GROUNDS FOR DECISION.—The Com-
mission shall grant registration under this sub-
section— 
‘‘(i) if the Commission finds that the 
requirements of this section are satisfied; 
and 
‘‘(ii) unless the Commission finds (in 
which case the Commission shall deny such 
registration) that— 
‘‘(I) the applicant has failed to 
certify to the Commission’s satisfaction 
that it has adequate financial and 
managerial resources to consistently 
provide proxy advice based on accurate 
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251 
information and to materially comply 
with the procedures and methodologies 
disclosed under paragraph (1)(B) and 
with subsections (f) and (g); or 
‘‘(II) if the applicant were so reg-
istered, its registration would be sub-
ject to suspension or revocation under 
subsection (e). 
‘‘(3) PUBLIC AVAILABILITY OF INFORMATION.— 
Subject to section 24, the Commission shall make the 
information and documents submitted to the Commis-
sion by a proxy advisory firm in its completed appli-
cation for registration, or in any amendment sub-
mitted under paragraph (1) or (2) of subsection (c), 
publicly available on the Commission’s website, or 
through another comparable, readily accessible means. 
‘‘(c) UPDATE OF REGISTRATION.— 
‘‘(1) UPDATE.—Each registered proxy advisory 
firm shall promptly amend and update its applica-
tion for registration under this section if any infor-
mation or document provided therein becomes materi-
ally inaccurate, except that a registered proxy advi-
sory firm is not required to amend the information 
required to be filed under subsection (b)(1)(B)(i) by 
filing information under this paragraph, but shall 
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252 
amend such information in the annual submission of 
the organization under paragraph (2) of this sub-
section. 
‘‘(2) CERTIFICATION.—Not later than 90 cal-
endar days after the end of each calendar year, each 
registered proxy advisory firm shall file with the 
Commission an amendment to its registration, in 
such form as the Commission, by rule, may prescribe 
as necessary or appropriate in the public interest or 
for the protection of investors— 
‘‘(A) certifying that the information and 
documents in the application for registration of 
such registered proxy advisory firm continue to 
be accurate in all material respects; and 
‘‘(B) listing any material change that oc-
curred to such information or documents during 
the previous calendar year. 
‘‘(d) CENSURE, DENIAL, OR SUSPENSION OF REG-
ISTRATION; NOTICE AND HEARING.—The Commission, by 
order, shall censure, place limitations on the activities, 
functions, or operations of, suspend for a period not exceed-
ing 12 months, or revoke the registration of any registered 
proxy advisory firm if the Commission finds, on the record 
after notice and opportunity for hearing, that such censure, 
placing of limitations, suspension, or revocation is nec-
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253 
essary for the protection of investors and in the public inter-
est and that such registered proxy advisory firm, or any 
person associated with such an organization, whether prior 
to or subsequent to becoming so associated— 
‘‘(1) has committed or omitted any act, or is 
subject to an order or finding, enumerated in sub-
paragraph (A), (D), (E), (H), or (G) of section 
15(b)(4), has been convicted of any offense specified in 
section 15(b)(4)(B), or is enjoined from any action, 
conduct, or practice specified in subparagraph (C) of 
section 15(b)(4), during the 10-year period preceding 
the date of commencement of the proceedings under 
this subsection, or at any time thereafter; 
‘‘(2) has been convicted during the 10-year pe-
riod preceding the date on which an application for 
registration is filed with the Commission under this 
section, or at any time thereafter, of— 
‘‘(A) any crime that is punishable by im-
prisonment for one or more years, and that is 
not described in section 15(b)(4)(B); or 
‘‘(B) a substantially equivalent crime by a 
foreign court of competent jurisdiction; 
‘‘(3) is subject to any order of the Commission 
barring or suspending the right of the person to be as-
sociated with a registered proxy advisory firm; 
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‘‘(4) fails to furnish the certifications required 
under subsections (b)(2)(C)(ii)(I) and (c)(2); 
‘‘(5) has engaged in one or more prohibited acts 
enumerated in paragraph (1); or 
‘‘(6) fails to maintain adequate financial and 
managerial resources to consistently offer advisory 
services with integrity, including by failing to comply 
with subsections (f) or (g). 
‘‘(e) TERMINATION OF REGISTRATION.— 
‘‘(1) VOLUNTARY
WITHDRAWAL.—A registered 
proxy advisory firm may, upon such terms and con-
ditions as the Commission may establish as necessary 
in the public interest or for the protection of investors, 
which terms and conditions shall include at a min-
imum that the registered proxy advisory firm will no 
longer conduct such activities as to bring it within 
the definition of proxy advisory firm in section 
3(a)(83) of the Securities Exchange Act of 1934, with-
draw from registration by filing a written notice of 
withdrawal to the Commission. 
‘‘(2) COMMISSION AUTHORITY.—In addition to 
any other authority of the Commission under this 
title, if the Commission finds that a registered proxy 
advisory firm is no longer in existence or has ceased 
to do business as a proxy advisory firm, the Commis-
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sion, by order, shall cancel the registration under this 
section of such registered proxy advisory firm. 
‘‘(f) MANAGEMENT OF CONFLICTS OF INTEREST.— 
‘‘(1) ORGANIZATION
POLICIES
AND
PROCE-
DURES.—Each registered proxy advisory firm shall 
establish, maintain, and enforce written policies and 
procedures reasonably designed, taking into consider-
ation the nature of the business of such registered 
proxy advisory firm and associated persons, to ad-
dress and manage any conflicts of interest that can 
arise from such business. 
‘‘(2) COMMISSION AUTHORITY.—The Commission 
shall issue final rules to prohibit, or require the man-
agement and disclosure of, any conflicts of interest re-
lating to the offering of proxy advisory services by a 
registered proxy advisory firm, including, without 
limitation, conflicts of interest relating to— 
‘‘(A) the manner in which a registered 
proxy advisory firm is compensated by the cli-
ent, or any affiliate of the client, for providing 
proxy advisory services; 
‘‘(B) the provision of consulting, advisory, 
or other services by a registered proxy advisory 
firm, or any person associated with such reg-
istered proxy advisory firm, to the client; 
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‘‘(C) business relationships, ownership in-
terests, or any other financial or personal inter-
ests between a registered proxy advisory firm, or 
any person associated with such registered proxy 
advisory firm, and any client, or any affiliate of 
such client; 
‘‘(D) transparency around the formulation 
of proxy voting policies; 
‘‘(E) the execution of proxy votes if such 
votes are based upon recommendations made by 
the proxy advisory firm in which someone other 
than the issuer is a proponent; 
‘‘(F) issuing recommendations where proxy 
advisory firms provide advisory services to a 
company; and 
‘‘(G) any other potential conflict of interest, 
as the Commission deems necessary or appro-
priate in the public interest or for the protection 
of investors. 
‘‘(g) RELIABILITY OF PROXY ADVISORY FIRM SERV-
ICES.— 
‘‘(1) IN GENERAL.—Each registered proxy advi-
sory firm shall have staff sufficient to produce proxy 
voting recommendations that are based on accurate 
and current information. Each registered proxy advi-
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sory firm shall detail procedures sufficient to permit 
companies 
receiving 
proxy 
advisory 
firm 
rec-
ommendations access in a reasonable time to the draft 
recommendations, with an opportunity to provide 
meaningful comment thereon, including the oppor-
tunity to present details to the person responsible for 
developing the recommendation in person or tele-
phonically. Each registered proxy advisory firm shall 
employ an ombudsman to receive complaints about 
the accuracy of voting information used in making 
recommendations from the subjects of the proxy advi-
sory firm’s voting recommendations, and shall resolve 
those complaints in a timely fashion and in any 
event prior to voting on the matter to which the rec-
ommendation relates. 
‘‘(2) DRAFT RECOMMENDATIONS DEFINED.—For 
purposes of this subsection, the term ‘draft rec-
ommendations’— 
‘‘(A) means the overall conclusions of proxy 
voting recommendations prepared for the clients 
of a proxy advisory firm, including any public 
data cited therein, any company information or 
substantive analysis impacting the recommenda-
tion, and the specific voting recommendations on 
individual proxy ballot issues; and 
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‘‘(B) does not include the entirety of the 
proxy advisory firm’s final report to its clients. 
‘‘(h) DESIGNATION OF COMPLIANCE OFFICER.—Each 
registered proxy advisory firm shall designate an indi-
vidual responsible for administering the policies and proce-
dures that are required to be established pursuant to sub-
sections (f) and (g), and for ensuring compliance with the 
securities laws and the rules and regulations thereunder, 
including those promulgated by the Commission pursuant 
to this section. 
‘‘(i) PROHIBITED CONDUCT.— 
‘‘(1) PROHIBITED
ACTS
AND
PRACTICES.—The 
Commission shall issue final rules to prohibit any act 
or practice relating to the offering of proxy advisory 
services by a registered proxy advisory firm that the 
Commission determines to be unfair or coercive, in-
cluding any act or practice relating to— 
‘‘(A) conditioning a voting recommendation 
or other proxy advisory firm recommendation on 
the purchase by an issuer or an affiliate thereof 
of other services or products, of the registered 
proxy advisory firm or any person associated 
with such registered proxy advisory firm; and 
‘‘(B) modifying a voting recommendation or 
otherwise departing from its adopted systematic 
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procedures and methodologies in the provision of 
proxy advisory services, based on whether an 
issuer, or affiliate thereof, subscribes or will sub-
scribe to other services or product of the reg-
istered proxy advisory firm or any person asso-
ciated with such organization. 
‘‘(2) RULE
OF
CONSTRUCTION.—Nothing in 
paragraph (1), or in any rules or regulations adopted 
thereunder, may be construed to modify, impair, or 
supersede the operation of any of the antitrust laws 
(as defined in the first section of the Clayton Act, ex-
cept that such term includes section 5 of the Federal 
Trade Commission Act, to the extent that such section 
5 applies to unfair methods of competition). 
‘‘(j) STATEMENTS OF FINANCIAL CONDITION.—Each 
registered proxy advisory firm shall, on a confidential 
basis, file with the Commission, at intervals determined by 
the Commission, such financial statements, certified (if re-
quired by the rules or regulations of the Commission) by 
an independent public auditor, and information concerning 
its financial condition, as the Commission, by rule, may 
prescribe as necessary or appropriate in the public interest 
or for the protection of investors. 
‘‘(k) ANNUAL REPORT.—Each registered proxy advi-
sory firm shall, at the beginning of each fiscal year of such 
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firm, report to the Commission on the number of share-
holder proposals its staff reviewed in the prior fiscal year, 
the number of recommendations made in the prior fiscal 
year, the number of staff who reviewed and made rec-
ommendations on such proposals in the prior fiscal year, 
and the number of recommendations made in the prior fis-
cal year where the proponent of such recommendation was 
a client of or received services from the proxy advisory firm. 
‘‘(l) TRANSPARENT POLICIES.—Each registered proxy 
advisory firm shall file with the Commission and make 
publicly available its methodology for the formulation of 
proxy voting policies and voting recommendations. 
‘‘(m) RULES OF CONSTRUCTION.— 
‘‘(1) NO WAIVER OF RIGHTS, PRIVILEGES, OR DE-
FENSES.—Registration under and compliance with 
this section does not constitute a waiver of, or other-
wise diminish, any right, privilege, or defense that a 
registered proxy advisory firm may otherwise have 
under any provision of State or Federal law, includ-
ing any rule, regulation, or order thereunder. 
‘‘(2) NO PRIVATE RIGHT OF ACTION.—Nothing in 
this section may be construed as creating any private 
right of action, and no report filed by a registered 
proxy advisory firm in accordance with this section 
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or section 17 shall create a private right of action 
under section 18 or any other provision of law. 
‘‘(n) REGULATIONS.— 
‘‘(1) NEW PROVISIONS.—Such rules and regula-
tions as are required by this section or are otherwise 
necessary to carry out this section, including the ap-
plication form required under subsection (a)— 
‘‘(A) shall be issued by the Commission, not 
later than 180 days after the date of enactment 
of this section; and 
‘‘(B) shall become effective not later than 1 
year after the date of enactment of this section. 
‘‘(2) REVIEW OF EXISTING REGULATIONS.—Not 
later than 270 days after the date of enactment of this 
section, the Commission shall— 
‘‘(A) review its existing rules and regula-
tions which affect the operations of proxy advi-
sory firms; 
‘‘(B) amend or revise such rules and regula-
tions in accordance with the purposes of this sec-
tion, and issue such guidance, as the Commis-
sion may prescribe as necessary or appropriate 
in the public interest or for the protection of in-
vestors; and 
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‘‘(C) direct Commission staff to withdraw 
the Egan Jones Proxy Services (May 27, 2004) 
and Institutional Shareholder Services, Inc. 
(September 15, 2004) no-action letters. 
‘‘(o) APPLICABILITY.—This section, other than sub-
section (n), which shall apply on the date of enactment of 
this section, shall apply on the earlier of— 
‘‘(1) the date on which regulations are issued in 
final form under subsection (n)(1); or 
‘‘(2) 270 days after the date of enactment of this 
section.’’. 
(b) CONFORMING AMENDMENT.—Section 17(a)(1) of 
the Securities Exchange Act of 1934 (15 U.S.C. 78q(a)(1)) 
is amended by inserting ‘‘proxy advisory firm,’’ after ‘‘na-
tionally recognized statistical rating organization,’’. 
SEC. 483. COMMISSION ANNUAL REPORT. 
The Commission shall make an annual report publicly 
available on the Commission’s Internet website. Such report 
shall, with respect to the year to which the report relates— 
(1) identify applicants for registration under 
section 15H of the Securities Exchange Act of 1934, 
as added by this subtitle; 
(2) specify the number of and actions taken on 
such applications; 
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(3) specify the views of the Commission on the 
state of competition, transparency, policies and meth-
odologies, and conflicts of interest among proxy advi-
sory firms; 
(4) include the determination of the Commission 
with regard to— 
(A) the quality of proxy advisory services 
issued by proxy advisory firms; 
(B) the financial markets; 
(C) competition among proxy advisory 
firms; 
(D) the incidence of undisclosed conflicts of 
interest by proxy advisory firms; 
(E) the process for registering as a proxy 
advisory firm; and 
(F) such other matters relevant to the im-
plementation of this subtitle and the amend-
ments made by this subtitle, as the Commission 
determines necessary to bring to the attention of 
the Congress; 
(5) identify problems, if any, that have resulted 
from the implementation of this subtitle and the 
amendments made by this subtitle; and 
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264 
(6) recommend solutions, including any legisla-
tive or regulatory solutions, to any problems identi-
fied under paragraphs (4) and (5). 
Subtitle R—Senior Safe 
SEC. 491. IMMUNITY. 
(a) DEFINITIONS.—In this subtitle— 
(1) the term ‘‘Bank Secrecy Act Officer’’ means 
an individual responsible for ensuring compliance 
with the requirements mandated by subchapter II of 
chapter 53 of title 31, United States Code; 
(2) the term ‘‘broker-dealer’’ means a broker or 
dealer, as those terms are defined, respectively, in sec-
tion 3(a) of the Securities Exchange Act of 1934 (15 
U.S.C. 78c(a)); 
(3) the term ‘‘covered agency’’ means— 
(A) a State financial regulatory agency, in-
cluding a State securities or law enforcement au-
thority and a State insurance regulator; 
(B) each of the Federal financial institu-
tions regulatory agencies; 
(C) the Securities and Exchange Commis-
sion; 
(D) a law enforcement agency; 
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(E) and State or local agency responsible 
for administering adult protective service laws; 
and 
(F) a State attorney general. 
(4) the term ‘‘covered financial institution’’ 
means— 
(A) a credit union; 
(B) a depository institution; 
(C) an investment advisor; 
(D) a broker-dealer; 
(E) an insurance company; 
(F) a State attorney general; and 
(G) a transfer agent. 
(5) the term ‘‘credit union’’ means a Federal 
credit union, State credit union, or State-chartered 
credit union, as those terms are defined in section 101 
of the Federal Credit Union Act (12 U.S.C. 1752); 
(6) the term ‘‘depository institution’’ has the 
meaning given the term in section 3(c) of the Federal 
Deposit Insurance Act (12 U.S.C. 1813(c)); 
(7) the term ‘‘exploitation’’ means the fraudulent 
or otherwise illegal, unauthorized, or improper act or 
process of an individual, including a caregiver or fi-
duciary, that— 
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(A) uses the resources of a senior citizen for 
monetary personal benefit, profit, or gain; or 
(B) results in depriving a senior citizen of 
rightful access to or use of benefits, resources, be-
longings or assets; 
(8) the term ‘‘Federal financial institutions reg-
ulatory agencies’’ has the meaning given the term in 
section 1003 of the Federal Financial Institutions Ex-
amination Council Act of 1978 (12 U.S.C. 3302); 
(9) the term ‘‘investment adviser’’ has the mean-
ing given the term in section 202 of the Investment 
Advisers Act of 1940 (15 U.S.C. 80b–2); 
(10) the term ‘‘insurance company’’ has the 
meaning given the term in section 2(a) of the Invest-
ment Company Act of 1940 (15 U.S.C. 80a–2(a)); 
(11) the term ‘‘registered representative’’ means 
an individual who represents a broker-dealer in effect-
ing or attempting to affect a purchase or sale of secu-
rities; 
(12) the term ‘‘senior citizen’’ means an indi-
vidual who is not less than 65 years of age; 
(13) the term ‘‘State insurance regulator’’ has 
the meaning given such term in section 315 of the 
Gramm-Leach-Bliley Act (15 U.S.C. 6735); 
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267 
(14) the term ‘‘State securities or law enforce-
ment authority’’ has the meaning given the term in 
section 24(f)(4) of the Securities Exchange Act of 
1934 (15 U.S.C. 78x(f)(4)); and 
(15) the term ‘‘transfer agent’’ has the meaning 
given the term in section 3(a) of the Securities Ex-
change Act of 1934 (15 U.S.C. 78c(a)). 
(b) IMMUNITY FROM SUIT.— 
(1) IMMUNITY FOR INDIVIDUALS.—An individual 
who has received the training described in section 
1092 shall not be liable, including in any civil or ad-
ministrative proceeding, for disclosing the possible ex-
ploitation of a senior citizen to a covered agency if 
the individual, at the time of the disclosure— 
(A) served as a supervisor, compliance offi-
cer (including a Bank Secrecy Act Officer), or 
registered representative for a covered financial 
institution; and 
(B) made the disclosure with reasonable 
care including reasonable efforts to avoid disclo-
sure other than to a covered agency. 
(2) IMMUNITY FOR COVERED FINANCIAL INSTITU-
TIONS.—A covered financial institution shall not be 
liable, including in any civil or administrative pro-
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ceeding, for a disclosure made by an individual de-
scribed in paragraph (1) if— 
(A) the individual was employed by, or, in 
the case of a registered representative, affiliated 
or associated with, the covered financial institu-
tion at the time of the disclosure; and 
(B) before the time of the disclosure, the cov-
ered financial institution provided the training 
described in section 492 to each individual de-
scribed in section 492(a). 
SEC. 492. TRAINING REQUIRED. 
(a) IN GENERAL.—A covered financial institution 
may provide training described in subsection (b)(1) to each 
officer or employee of, or registered representative affiliated 
or associated with, the covered financial institution who— 
(1) is described in section 491(b)(1)(A); 
(2) may come into contact with a senior citizen 
as a regular part of the duties of the officer, employee, 
or registered representative; or 
(3) may review or approve the financial docu-
ments, records, or transactions of a senior citizen in 
connection with providing financial services to a sen-
ior citizen. 
(b) TRAINING.— 
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269 
(1) IN GENERAL.—The training described in this 
paragraph shall— 
(A) instruct any individual attending the 
training on how to identify and report the sus-
pected exploitation of a senior citizen; 
(B) discuss the need to protect the privacy 
and respect the integrity of each individual cus-
tomer of a covered financial institution; and 
(C) be appropriate to the job responsibilities 
of the individual attending the training. 
(2) TIMING.—The training required under sub-
section (a) shall be provided as soon as reasonably 
practicable but not later than 1 year after the date 
on which an officer, employee, or registered represent-
ative begins employment with or becomes affiliated or 
associated with the covered financial institution. 
(3) BANK
SECRECY
ACT
OFFICER.—An indi-
vidual who is designated as a compliance officer 
under an anti-money laundering program established 
pursuant to section 5318(h) of title 31, United States 
Code, shall be deemed to have received the training 
described under this subsection. 
SEC. 493. RELATIONSHIP TO STATE LAW. 
Nothing in this Act shall be construed to preempt or 
limit any provision of State law, except only to the extent 
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that section 1091 provides a greater level of protection 
against liability to an individual described in section 
491(b)(1) or to a covered financial institution described in 
section 491(b)(2) than is provided under State law. 
Subtitle S—National Securities 
Exchange Regulatory Parity 
SEC. 496. APPLICATION OF EXEMPTION. 
Section 18(b)(1) of the Securities Act of 1933 (15 
U.S.C. 77r(b)(1)), as amended by section 456(b), is further 
amended— 
(1) by striking subparagraph (A); 
(2) in subparagraph (B), by striking ‘‘that the 
Commission determines by rule (on its own initiative 
or on the basis of a petition) are substantially similar 
to the listing standards applicable to securities de-
scribed in subparagraph (A)’’ and inserting ‘‘that 
have been approved by the Commission’’; 
(3) in subparagraph (C), by striking ‘‘or (B)’’; 
and 
(4) by redesignating subparagraphs (B), (C), 
and (D) as subparagraphs (A), (B), and (C), respec-
tively. 
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271 
Subtitle T—Private Company 
Flexibility and Growth 
SEC. 497. SHAREHOLDER THRESHOLD FOR REGISTRATION. 
The Securities Exchange Act of 1934 (15 U.S.C. 78a 
et seq.) is amended— 
(1) in section 12(g)— 
(A) in paragraph (1)— 
(i) by striking ‘‘shall—’’ and all that 
follows through ‘‘register such security’’ and 
inserting ‘‘shall, not later than 120 days 
after the last day of its first fiscal year 
ended after the effective date of this sub-
section on which the issuer has total assets 
exceeding $10,000,000 (or such greater 
amount of assets as the Commission may es-
tablish by rule) and a class of equity secu-
rity (other than an exempted security) held 
of record by 2,000 or more persons (or such 
greater number of persons as the Commis-
sion may establish by rule), register such se-
curity’’; and 
(ii) by adding at the end the following: 
‘‘The dollar figure in this paragraph shall 
be indexed for inflation every 5 years by the 
Commission to reflect the change in the 
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272 
Consumer Price Index for All Urban Con-
sumers published by the Bureau of Labor 
Statistics, 
rounded 
to 
the 
nearest 
$100,000.’’; and 
(B) in paragraph (4), by striking ‘‘300 per-
sons’’ and all that follows through ‘‘1,200 persons 
persons’’ and inserting ‘‘1,200 persons’’; and 
(2) in section 15(d)(1), by striking ‘‘300 per-
sons’’ and all that follows through ‘‘1,200 persons per-
sons’’ and inserting ‘‘1,200 persons’’. 
Subtitle U—Small Company 
Capital Formation Enhancements 
SEC. 498. JOBS ACT-RELATED EXEMPTION. 
Section 3(b) of the Securities Act of 1933 (15 U.S.C. 
77c(b)) is amended— 
(1) 
in 
paragraph 
(2)(A), 
by 
striking 
‘‘$50,000,000’’ and inserting ‘‘$75,000,000, adjusted 
for inflation by the Commission every 2 years to the 
nearest $10,000 to reflect the change in the Consumer 
Price Index for All Urban Consumers published by 
the Bureau of Labor Statistics’’; and 
(2) in paragraph (5)— 
(A) by striking ‘‘such amount as’’ and in-
serting: ‘‘such amount, in addition to the adjust-
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273 
ment for inflation provided for under such para-
graph (2)(A), as’’; and 
(B) by striking ‘‘such amount, it’’ and in-
serting ‘‘such amount, in addition to the adjust-
ment for inflation provided for under such para-
graph (2)(A), it’’. 
Subtitle V—Encouraging Public 
Offerings 
SEC. 499. EXPANDING TESTING THE WATERS AND CON-
FIDENTIAL SUBMISSIONS. 
The Securities Act of 1933 (15 U.S.C. 77a et seq.) is 
amended— 
(1) in section 5(d), by striking ‘‘an emerging 
growth company or any person authorized to act on 
behalf of an emerging growth company’’ and inserting 
‘‘an issuer or any person authorized to act on behalf 
of an issuer’’; and 
(2) in section 6(e)— 
(A) in the heading, by striking ‘‘EMERGING 
GROWTH COMPANIES’’ and inserting ‘‘DRAFT 
REGISTRATION STATEMENTS’’; and 
(B) by amending paragraph (1) to read as 
follows: 
‘‘(1) IN GENERAL.—Any issuer, prior to its ini-
tial public offering date, may confidentially submit to 
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274 
the Commission a draft registration statement, for 
confidential nonpublic review by the staff of the Com-
mission prior to public filing, provided that the ini-
tial confidential submission and all amendments 
thereto shall be publicly filed with the Commission 
not later than 15 days before the date on which the 
issuer conducts a road show, as such term is defined 
in section 230.433(h)(4) of title 17, Code of Federal 
Regulations, or any successor thereto.’’. 
TITLE V—REGULATORY RELIEF 
FOR MAIN STREET AND COM-
MUNITY FINANCIAL INSTITU-
TIONS 
Subtitle A—Preserving Access to 
Manufactured Housing 
SEC. 501. MORTGAGE ORIGINATOR DEFINITION. 
Section 103 of the Truth in Lending Act (15 U.S.C. 
1602) is amended— 
(1) by redesignating the second subsection (cc) 
and subsection (dd) as subsections (dd) and (ee), re-
spectively; and 
(2) in paragraph (2)(C) of subsection (dd), as so 
redesignated, by striking ‘‘an employee of a retailer of 
manufactured homes who is not described in clause 
(i) or (iii) of subparagraph (A) and who does not ad-
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vise a consumer on loan terms (including rates, fees, 
and other costs)’’ and inserting ‘‘a retailer of manu-
factured or modular homes or its employees unless 
such retailer or its employees receive compensation or 
gain for engaging in activities described in subpara-
graph (A) that is in excess of any compensation or 
gain received in a comparable cash transaction’’. 
SEC. 502. HIGH-COST MORTGAGE DEFINITION. 
Section 103 of the Truth in Lending Act (15 U.S.C. 
1602), as amended by section 501, is further amended— 
(1) by redesignating subsection (aa) (relating to 
disclosure of greater amount or percentage), as so des-
ignated by section 1100A of the Consumer Financial 
Protection Act of 2010, as subsection (bb); 
(2) by redesignating subsection (bb) (relating to 
high cost mortgages), as so designated by section 
1100A of the Consumer Financial Protection Act of 
2010, as subsection (aa), and moving such subsection 
to immediately follow subsection (z); and 
(3) in subsection (aa)(1)(A), as so redesig-
nated— 
(A) in clause (i)(I), by striking ‘‘(8.5 per-
centage points, if the dwelling is personal prop-
erty and the transaction is for less than 
$50,000)’’ and inserting ‘‘(10 percentage points 
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flect the change in the Consumer Price 
Index); or’’. 
Subtitle B—Mortgage Choice 
SEC. 506. DEFINITION OF POINTS AND FEES. 
(a) AMENDMENT TO SECTION 103 OF TILA.—Para-
graph (4) of section 103(aa) of the Truth in Lending Act, 
as redesignated by section 502, is amended— 
(1) by striking ‘‘paragraph (1)(B)’’ and insert-
ing ‘‘paragraph (1)(A) and section 129C’’; 
(2) in subparagraph (C)— 
(A) by inserting ‘‘and insurance’’ after 
‘‘taxes’’; 
(B) in clause (ii), by inserting ‘‘, except as 
retained by a creditor or its affiliate as a result 
of their participation in an affiliated business 
arrangement (as defined in section 3(7) of the 
Real Estate Settlement Procedures Act of 1974 
(12 U.S.C. 2602(7))’’ after ‘‘compensation’’; and 
(C) by striking clause (iii) and inserting 
the following: 
‘‘(iii) the charge is— 
‘‘(I) a bona fide third-party charge not 
retained by the mortgage originator, cred-
itor, or an affiliate of the creditor or mort-
gage originator; or 
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‘‘(II) a charge set forth in section 
106(e)(1);’’; and 
(3) in subparagraph (D)— 
(A) by striking ‘‘accident,’’; and 
(B) by striking ‘‘or any payments’’ and in-
serting ‘‘and any payments’’. 
(b) AMENDMENT TO SECTION 129C OF TILA.—Section 
129C of the Truth in Lending Act (15 U.S.C. 1639c) is 
amended— 
(1) in subsection (a)(5)(C), by striking ‘‘103’’ 
and all that follows through ‘‘or mortgage originator’’ 
and inserting ‘‘103(aa)(4)’’; and 
(2) in subsection (b)(2)(C)(i), by striking ‘‘103’’ 
and all that follows through ‘‘or mortgage origi-
nator)’’ and inserting ‘‘103(aa)(4)’’. 
Subtitle C—Financial Institution 
Customer Protection 
SEC. 511. REQUIREMENTS FOR DEPOSIT ACCOUNT TERMI-
NATION REQUESTS AND ORDERS. 
(a) TERMINATION REQUESTS OR ORDERS MUST BE 
MATERIAL.— 
(1) IN GENERAL.—An appropriate Federal bank-
ing agency may not formally or informally request or 
order a depository institution to terminate a specific 
customer account or group of customer accounts or to 
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otherwise restrict or discourage a depository institu-
tion from entering into or maintaining a banking re-
lationship with a specific customer or group of cus-
tomers unless— 
(A) the agency has a material reason for 
such request or order; and 
(B) such reason is not based solely on rep-
utation risk. 
(2) 
TREATMENT
OF
NATIONAL
SECURITY 
THREATS.—If an appropriate Federal banking agen-
cy believes a specific customer or group of customers 
is, or is acting as a conduit for, an entity which— 
(A) poses a threat to national security; 
(B) is involved in terrorist financing; 
(C) is an agency of the government of Iran, 
North Korea, Syria, or any country listed from 
time to time on the State Sponsors of Terrorism 
list; 
(D) is located in, or is subject to the juris-
diction of, any country specified in subpara-
graph (C); or 
(E) does business with any entity described 
in subparagraph (C) or (D), unless the appro-
priate Federal banking agency determines that 
the customer or group of customers has used due 
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diligence to avoid doing business with any entity 
described in subparagraph (C) or (D), 
such belief shall satisfy the requirement under para-
graph (1). 
(b) NOTICE REQUIREMENT.— 
(1) IN
GENERAL.—If an appropriate Federal 
banking agency formally or informally requests or or-
ders a depository institution to terminate a specific 
customer account or a group of customer accounts, the 
agency shall— 
(A) provide such request or order to the in-
stitution in writing; and 
(B) accompany such request or order with 
a written justification for why such termination 
is needed, including any specific laws or regula-
tions the agency believes are being violated by 
the customer or group of customers, if any. 
(2) JUSTIFICATION REQUIREMENT.—A justifica-
tion described under paragraph (1)(B) may not be 
based solely on the reputation risk to the depository 
institution. 
(c) CUSTOMER NOTICE.— 
(1) NOTICE
REQUIRED.—Except as provided 
under paragraph (2), if an appropriate Federal bank-
ing agency orders a depository institution to termi-
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nate a specific customer account or a group of cus-
tomer accounts, the depository institution shall in-
form the customer or customers of the justification for 
the customer’s account termination described under 
subsection (b). 
(2) NOTICE PROHIBITED IN CASES OF NATIONAL 
SECURITY.—If an appropriate Federal banking agen-
cy requests or orders a depository institution to ter-
minate a specific customer account or a group of cus-
tomer accounts based on a belief that the customer or 
customers pose a threat to national security, or are 
otherwise described under subsection (a)(2), neither 
the depository institution nor the appropriate Federal 
banking agency may inform the customer or cus-
tomers of the justification for the customer’s account 
termination. 
(d) REPORTING REQUIREMENT.—Each appropriate 
Federal banking agency shall issue an annual report to the 
Congress stating— 
(1) the aggregate number of specific customer ac-
counts that the agency requested or ordered a deposi-
tory institution to terminate during the previous 
year; and 
(2) the legal authority on which the agency re-
lied in making such requests and orders and the fre-
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quency on which the agency relied on each such au-
thority. 
(e) DEFINITIONS.—For purposes of this section: 
(1) APPROPRIATE FEDERAL BANKING AGENCY.— 
The term ‘‘appropriate Federal banking agency’’ 
means— 
(A) the appropriate Federal banking agen-
cy, as defined under section 3 of the Federal De-
posit Insurance Act (12 U.S.C. 1813); and 
(B) the National Credit Union Administra-
tion, in the case of an insured credit union. 
(2) DEPOSITORY INSTITUTION.—The term ‘‘de-
pository institution’’ means— 
(A) a depository institution, as defined 
under section 3 of the Federal Deposit Insurance 
Act (12 U.S.C. 1813); and 
(B) an insured credit union. 
SEC. 512. AMENDMENTS TO THE FINANCIAL INSTITUTIONS 
REFORM, 
RECOVERY, 
AND 
ENFORCEMENT 
ACT OF 1989. 
Section 951 of the Financial Institutions Reform, Re-
covery, and Enforcement Act of 1989 (12 U.S.C. 1833a) is 
amended— 
(1) in subsection (c)(2), by striking ‘‘affecting a 
federally insured financial institution’’ and inserting 
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‘‘against a federally insured financial institution or 
by a federally insured financial institution against 
an unaffiliated third person’’; and 
(2) in subsection (g)— 
(A) in the heading, by striking ‘‘SUB-
POENAS’’ and inserting ‘‘INVESTIGATIONS’’; and 
(B) by amending paragraph (1)(C) to read 
as follows: 
‘‘(C) summon witnesses and require the pro-
duction of any books, papers, correspondence, 
memoranda, or other records which the Attorney 
General deems relevant or material to the in-
quiry, if the Attorney General— 
‘‘(i) requests a court order from a court 
of competent jurisdiction for such actions 
and offers specific and articulable facts 
showing that there are reasonable grounds 
to believe that the information or testimony 
sought is relevant and material for con-
ducting an investigation under this section; 
or 
‘‘(ii) either personally or through dele-
gation no lower than the Deputy Attorney 
General, issues and signs a subpoena for 
such actions and such subpoena is sup-
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ported by specific and articulable facts 
showing that there are reasonable grounds 
to believe that the information or testimony 
sought is relevant for conducting an inves-
tigation under this section.’’. 
Subtitle D—Portfolio Lending and 
Mortgage Access 
SEC. 516. SAFE HARBOR FOR CERTAIN LOANS HELD ON 
PORTFOLIO. 
(a) IN GENERAL.—Section 129C of the Truth in Lend-
ing Act (15 U.S.C. 1639c) is amended by adding at the 
end the following: 
‘‘(j) SAFE HARBOR FOR CERTAIN LOANS HELD ON 
PORTFOLIO.— 
‘‘(1) SAFE HARBOR FOR CREDITORS THAT ARE 
DEPOSITORY INSTITUTIONS.— 
‘‘(A) IN GENERAL.—A creditor that is a de-
pository institution shall not be subject to suit 
for failure to comply with subsection (a), (c)(1), 
or (f)(2) of this section or section 129H with re-
spect to a residential mortgage loan, and the 
banking regulators shall treat such loan as a 
qualified mortgage, if— 
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‘‘(i) the creditor has, since the origina-
tion of the loan, held the loan on the bal-
ance sheet of the creditor; and 
‘‘(ii) all prepayment penalties with re-
spect to the loan comply with the limita-
tions described under subsection (c)(3). 
‘‘(B) EXCEPTION
FOR
CERTAIN
TRANS-
FERS.—In the case of a depository institution 
that transfers a loan originated by that institu-
tion to another depository institution by reason 
of the bankruptcy or failure of the originating 
depository institution or the purchase of the 
originating depository institution, the depository 
institution transferring such loan shall be 
deemed to have complied with the requirement 
under subparagraph (A)(i). 
‘‘(2) SAFE
HARBOR
FOR
MORTGAGE
ORIGINA-
TORS.—A mortgage originator shall not be subject to 
suit for a violation of section 129B(c)(3)(B) for steer-
ing a consumer to a residential mortgage loan if— 
‘‘(A) the creditor of such loan is a deposi-
tory institution and has informed the mortgage 
originator that the creditor intends to hold the 
loan on the balance sheet of the creditor for the 
life of the loan; and 
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‘‘(B) the mortgage originator informs the 
consumer that the creditor intends to hold the 
loan on the balance sheet of the creditor for the 
life of the loan. 
‘‘(3) DEFINITIONS.—For purposes of this sub-
section: 
‘‘(A) BANKING
REGULATORS.—The term 
‘banking regulators’ means the Federal banking 
agencies, the Consumer Law Enforcement Agen-
cy, and the National Credit Union Administra-
tion. 
‘‘(B) DEPOSITORY INSTITUTION.—The term 
‘depository institution’ has the meaning given 
that term under section 19(b)(1) of the Federal 
Reserve Act (12 U.S.C. 505(b)(1)). 
‘‘(C) FEDERAL
BANKING
AGENCIES.—The 
term ‘Federal banking agencies’ has the meaning 
given that term under section 3 of the Federal 
Deposit Insurance Act.’’. 
(b) RULE OF CONSTRUCTION.—Nothing in the amend-
ment made by this section may be construed as preventing 
a balloon loan from qualifying for the safe harbor provided 
under section 129C(j) of the Truth in Lending Act if the 
balloon loan otherwise meets all of the requirements under 
such subsection (j), regardless of whether the balloon loan 
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meets the requirements described under clauses (i) through 
(iv) of section 129C(b)(2)(E) of such Act. 
Subtitle E—Application of the 
Expedited Funds Availability Act 
SEC. 521. APPLICATION OF THE EXPEDITED FUNDS AVAIL-
ABILITY ACT. 
(a) IN GENERAL.—The Expedited Funds Availability 
Act (12 U.S.C. 4001 et seq.) is amended— 
(1) in section 602(20) (12 U.S.C. 4001(20)) by 
inserting ‘‘, located in the United States,’’ after 
‘‘ATM’’; 
(2) in section 602(21) (12 U.S.C. 4001(21)) by 
inserting ‘‘American Samoa, the Commonwealth of 
the Northern Mariana Islands,’’ after ‘‘Puerto Rico,’’; 
(3) in section 602(23) (12 U.S.C. 4001(23)) by 
inserting ‘‘American Samoa, the Commonwealth of 
the Northern Mariana Islands,’’ after ‘‘Puerto Rico,’’; 
and 
(4) 
in 
section 
603(d)(2)(A) 
(12 
U.S.C. 
4002(d)(2)(A)), by inserting ‘‘American Samoa, the 
Commonwealth of the Northern Mariana Islands,’’ 
after ‘‘Puerto Rico,’’. 
(b) EFFECTIVE DATE.—This section shall take effect 
on January 1, 2017. 
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Subtitle F—Small Bank Holding 
Company Policy Statement 
SEC. 526. CHANGES REQUIRED TO SMALL BANK HOLDING 
COMPANY POLICY STATEMENT ON ASSESS-
MENT OF FINANCIAL AND MANAGERIAL FAC-
TORS. 
(a) IN GENERAL.—Before the end of the 6-month pe-
riod beginning on the date of the enactment of this Act, 
the Board of Governors of the Federal Reserve System shall 
revise the Small Bank Holding Company Policy Statement 
on Assessment of Financial and Managerial Factors (12 
C.F.R. part 225—appendix C) to raise the consolidated 
asset 
threshold 
under 
such 
policy 
statement 
from 
$1,000,000,000 (as adjusted by Public Law 113–250) to 
$10,000,000,000. 
(b) CONFORMING AMENDMENT.—Subparagraph (C) of 
section 171(b)(5) of the Dodd-Frank Wall Street Reform 
and Consumer Protection Act (12 U.S.C. 5371(b)(5)) is 
amended to read as follows: 
‘‘(C) any bank holding company or savings 
and loan holding company that is subject to the 
application of the Small Bank Holding Com-
pany Policy Statement on Assessment of Finan-
cial and Managerial Factors of the Board of 
Governors (12 C.F.R. part 225—appendix C).’’. 
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Subtitle G—Community Institution 
Mortgage Relief 
SEC. 531. COMMUNITY FINANCIAL INSTITUTION MORTGAGE 
RELIEF. 
(a) EXEMPTION FROM ESCROW REQUIREMENTS FOR 
LOANS HELD BY SMALLER CREDITORS.—Section 129D of 
the Truth in Lending Act (15 U.S.C. 1639d) is amended— 
(1) by adding at the end the following: 
‘‘(k) SAFE HARBOR FOR LOANS HELD BY SMALLER 
CREDITORS.— 
‘‘(1) IN GENERAL.—A creditor shall not be in 
violation of subsection (a) with respect to a loan if— 
‘‘(A) the creditor has consolidated assets of 
$10,000,000,000 or less; and 
‘‘(B) the creditor holds the loan on the bal-
ance sheet of the creditor for the 3-year period 
beginning on the date of the origination of the 
loan. 
‘‘(2) EXCEPTION FOR CERTAIN TRANSFERS.—In 
the case of a creditor that transfers a loan to another 
person by reason of the bankruptcy or failure of the 
creditor, the purchase of the creditor, or a supervisory 
act or recommendation from a State or Federal regu-
lator, the creditor shall be deemed to have complied 
with the requirement under paragraph (1)(B).’’; and 
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(2) by striking the term ‘‘Board’’ each place such 
term appears and inserting ‘‘Consumer Law Enforce-
ment Agency’’. 
(b) MODIFICATION
TO
EXEMPTION
FOR
SMALL 
SERVICERS OF MORTGAGE LOANS.—Section 6 of the Real 
Estate Settlement Procedures Act of 1974 (12 U.S.C. 2605) 
is amended by adding at the end the following: 
‘‘(n) SMALL SERVICER EXEMPTION.—The Consumer 
Law Enforcement Agency shall, by regulation, provide ex-
emptions to, or adjustments for, the provisions of this sec-
tion for a servicer that annually services 20,000 or fewer 
mortgage loans, in order to reduce regulatory burdens while 
appropriately balancing consumer protections.’’. 
Subtitle H—Financial Institutions 
Examination Fairness and Reform 
SEC. 536. TIMELINESS OF EXAMINATION REPORTS. 
(a) IN GENERAL.—The Federal Financial Institutions 
Examination Council Act of 1978 (12 U.S.C. 3301 et seq.) 
is amended by adding at the end the following: 
‘‘SEC. 1012. TIMELINESS OF EXAMINATION REPORTS. 
‘‘(a) IN GENERAL.— 
‘‘(1) FINAL EXAMINATION REPORT.—A Federal 
financial institutions regulatory agency shall provide 
a final examination report to a financial institution 
not later than 60 days after the later of— 
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‘‘(A) the exit interview for an examination 
of the institution; or 
‘‘(B) the provision of additional informa-
tion by the institution relating to the examina-
tion. 
‘‘(2) EXIT INTERVIEW.—If a financial institu-
tion is not subject to a resident examiner program, 
the exit interview shall occur not later than the end 
of the 9-month period beginning on the commence-
ment of the examination, except that such period may 
be extended by the Federal financial institutions regu-
latory agency by providing written notice to the insti-
tution and the Independent Examination Review Di-
rector describing with particularity the reasons that 
a longer period is needed to complete the examina-
tion. 
‘‘(b) EXAMINATION MATERIALS.—Upon the request of 
a financial institution, the Federal financial institutions 
regulatory agency shall include with the final report an ap-
pendix listing all examination or other factual information 
relied upon by the agency in support of a material super-
visory determination. 
‘‘SEC. 1013. EXAMINATION STANDARDS. 
‘‘(a) IN GENERAL.—In the examination of a financial 
institution— 
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‘‘(1) a commercial loan shall not be placed in 
non-accrual status solely because the collateral for 
such loan has deteriorated in value; 
‘‘(2) a modified or restructured commercial loan 
shall be removed from non-accrual status if the bor-
rower demonstrates the ability to perform on such 
loan over a maximum period of 6 months, except that 
with respect to loans on a quarterly, semiannual, or 
longer repayment schedule such period shall be a 
maximum of 3 consecutive repayment periods; 
‘‘(3) a new appraisal on a performing commer-
cial loan shall not be required unless an advance of 
new funds is involved; and 
‘‘(4) in classifying a commercial loan in which 
there has been deterioration in collateral value, the 
amount to be classified shall be the portion of the defi-
ciency relating to the decline in collateral value and 
repayment capacity of the borrower. 
‘‘(b) WELL CAPITALIZED INSTITUTIONS.—The Federal 
financial institutions regulatory agencies may not require 
a financial institution that is well capitalized to raise addi-
tional capital in lieu of an action prohibited under sub-
section (a). 
‘‘(c) CONSISTENT LOAN CLASSIFICATIONS.—The Fed-
eral financial institutions regulatory agencies shall develop 
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and apply identical definitions and reporting requirements 
for non-accrual loans. 
‘‘SEC. 1014. OFFICE OF INDEPENDENT EXAMINATION RE-
VIEW. 
‘‘(a) ESTABLISHMENT.—There is established in the 
Council an Office of Independent Examination Review (the 
‘Office’). 
‘‘(b) HEAD OF OFFICE.—There is established the posi-
tion of the Independent Examination Review Director (the 
‘Director’), as the head of the Office. The Director shall be 
appointed by the Council and shall be independent from 
any member agency of the Council. 
‘‘(c) STAFFING.—The Director is authorized to hire 
staff to support the activities of the Office. 
‘‘(d) DUTIES.—The Director shall— 
‘‘(1) receive and, at the Director’s discretion, in-
vestigate complaints from financial institutions, their 
representatives, or another entity acting on behalf of 
such institutions, concerning examinations, examina-
tion practices, or examination reports; 
‘‘(2) hold meetings, at least once every three 
months and in locations designed to encourage par-
ticipation from all sections of the United States, with 
financial institutions, their representatives, or an-
other entity acting on behalf of such institutions, to 
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discuss examination procedures, examination prac-
tices, or examination policies; 
‘‘(3) review examination procedures of the Fed-
eral financial institutions regulatory agencies to en-
sure that the written examination policies of those 
agencies are being followed in practice and adhere to 
the standards for consistency established by the Coun-
cil; 
‘‘(4) conduct a continuing and regular review of 
examination quality assurance for all examination 
types conducted by the Federal financial institutions 
regulatory agencies; 
‘‘(5) adjudicate any supervisory appeal initiated 
under section 1015; and 
‘‘(6) report annually to the Committee on Finan-
cial Services of the House of Representatives, the 
Committee on Banking, Housing, and Urban Affairs 
of the Senate, and the Council, on the reviews carried 
out pursuant to paragraphs (3) and (4), including 
compliance with the requirements set forth in section 
1012 regarding timeliness of examination reports, 
and the Council’s recommendations for improvements 
in examination procedures, practices, and policies. 
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‘‘(e) CONFIDENTIALITY.—The Director shall keep con-
fidential all meetings with, discussions with, and informa-
tion provided by financial institutions. 
‘‘SEC. 1015. RIGHT TO INDEPENDENT REVIEW OF MATERIAL 
SUPERVISORY DETERMINATIONS. 
‘‘(a) IN GENERAL.—A financial institution shall have 
the right to obtain an independent review of a material su-
pervisory determination contained in a final report of ex-
amination. 
‘‘(b) NOTICE.— 
‘‘(1) TIMING.—A financial institution seeking re-
view of a material supervisory determination under 
this section shall file a written notice with the Inde-
pendent Examination Review Director (the ‘Director’) 
within 60 days after receiving the final report of ex-
amination that is the subject of such review. 
‘‘(2) IDENTIFICATION OF DETERMINATION.—The 
written notice shall identify the material supervisory 
determination that is the subject of the independent 
examination review, and a statement of the reasons 
why the institution believes that the determination is 
incorrect or should otherwise be modified. 
‘‘(3) INFORMATION TO BE PROVIDED TO INSTITU-
TION.—Any information relied upon by the agency in 
the final report that is not in the possession of the fi-
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nancial institution may be requested by the financial 
institution and shall be delivered promptly by the 
agency to the financial institution. 
‘‘(c) RIGHT TO HEARING.— 
‘‘(1) IN GENERAL.—The Director shall determine 
the merits of the appeal on the record or, at the finan-
cial institution’s election, shall refer the appeal to an 
Administrative Law Judge to conduct a confidential 
hearing pursuant to the procedures set forth under 
sections 556 and 557 of title 5, United States Code, 
which hearing shall take place not later than 60 days 
after the petition for review was received by the Di-
rector, and to issue a proposed decision to the Direc-
tor based upon the record established at such hearing. 
‘‘(2) STANDARD OF REVIEW.—In rendering a de-
termination or recommendation under this subsection, 
neither the Administrative Law Judge nor the Direc-
tor shall defer to the opinions of the examiner or 
agency, but shall conduct a de novo review to inde-
pendently determine the appropriateness of the agen-
cy’s decision based upon the relevant statutes, regula-
tions, and other appropriate guidance, as well as evi-
dence adduced at any hearing. 
‘‘(d) FINAL DECISION.—A decision by the Director on 
an independent review under this section shall— 
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‘‘(1) be made not later than 60 days after the 
record has been closed; and 
‘‘(2) be deemed final agency action and shall 
bind the agency whose supervisory determination was 
the subject of the review and the financial institution 
requesting the review. 
‘‘(e) RIGHT TO JUDICIAL REVIEW.—A financial insti-
tution shall have the right to petition for review of final 
agency action under this section by filing a Petition for 
Review within 60 days of the Director’s decision in the 
United States Court of Appeals for the District of Columbia 
Circuit or the Circuit in which the financial institution 
is located. 
‘‘(f) REPORT.—The Director shall report annually to 
the Committee on Financial Services of the House of Rep-
resentatives and the Committee on Banking, Housing, and 
Urban Affairs of the Senate on actions taken under this 
section, including the types of issues that the Director has 
reviewed and the results of those reviews. In no case shall 
such a report contain information about individual finan-
cial institutions or any confidential or privileged informa-
tion shared by financial institutions. 
‘‘(g) RETALIATION PROHIBITED.—A Federal financial 
institutions regulatory agency may not— 
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‘‘(1) retaliate against a financial institution, in-
cluding service providers, or any institution-affiliated 
party (as defined under section 3 of the Federal De-
posit Insurance Act), for exercising appellate rights 
under this section; or 
‘‘(2) delay or deny any agency action that would 
benefit a financial institution or any institution-af-
filiated party on the basis that an appeal under this 
section is pending under this section. 
‘‘(h) RULE OF CONSTRUCTION.—Nothing in this sec-
tion may be construed— 
‘‘(1) to affect the right of a Federal financial in-
stitutions regulatory agency to take enforcement or 
other supervisory actions related to a material super-
visory determination under review under this section; 
or 
‘‘(2) to prohibit the review under this section of 
a material supervisory determination with respect to 
which there is an ongoing enforcement or other super-
visory action.’’. 
(b) ADDITIONAL AMENDMENTS.— 
(1) RIEGLE
COMMUNITY
DEVELOPMENT
AND 
REGULATORY
IMPROVEMENT
ACT
OF
1994.—Section 
309 of the Riegle Community Development and Regu-
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299 
latory Improvement Act of 1994 (12 U.S.C. 4806) is 
amended— 
(A) in subsection (a), by inserting after 
‘‘appropriate Federal banking agency’’ the fol-
lowing: ‘‘, the Consumer Law Enforcement Agen-
cy,’’; 
(B) in subsection (b)— 
(i) in paragraph (2), by striking ‘‘the 
appellant from retaliation by agency exam-
iners’’ and inserting ‘‘the insured depository 
institution or insured credit union from re-
taliation by the agencies referred to in sub-
section (a)’’; and 
(ii) by adding at the end the following 
flush-left text: 
‘‘For purposes of this subsection and subsection (e), retalia-
tion includes delaying consideration of, or withholding ap-
proval of, any request, notice, or application that otherwise 
would have been approved, but for the exercise of the institu-
tion’s or credit union’s rights under this section.’’; 
(C) in subsection (e)(2)— 
(i) in subparagraph (B), by striking 
‘‘and’’ at the end; 
(ii) in subparagraph (C), by striking 
the period and inserting ‘‘; and’’; and 
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(iii) by adding at the end the fol-
lowing: 
‘‘(D) ensure that appropriate safeguards 
exist for protecting the insured depository insti-
tution or insured credit union from retaliation 
by any agency referred to in subsection (a) for 
exercising its rights under this subsection.’’; and 
(D) in subsection (f)(1)(A)— 
(i) in clause (ii), by striking ‘‘and’’ at 
the end; 
(ii) in clause (iii), by striking ‘‘and’’ 
at the end; and 
(iii) by adding at the end the fol-
lowing: 
‘‘(iv) any issue specifically listed in an 
exam report as a matter requiring attention 
by the institution’s management or board of 
directors; and 
‘‘(v) any suspension or removal of an 
institution’s status as eligible for expedited 
processing of applications, requests, notices, 
or filings on the grounds of a supervisory or 
compliance concern, regardless of whether 
that concern has been cited as a basis for 
another material supervisory determination 
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or matter requiring attention in an exam-
ination report, provided that the conduct at 
issue did not involve violation of any crimi-
nal law; and’’. 
(2) FEDERAL
CREDIT
UNION
ACT.—Section 
205(j) of the Federal Credit Union Act (12 U.S.C. 
1785(j)) is amended by inserting ‘‘the Consumer Law 
Enforcement Agency,’’ before ‘‘the Administration’’ 
each place such term appears. 
(3) FEDERAL FINANCIAL INSTITUTIONS EXAMINA-
TION COUNCIL ACT OF 1978.—The Federal Financial 
Institutions Examination Council Act of 1978 (12 
U.S.C. 3301 et seq.) is amended— 
(A) in section 1003, by amending para-
graph (1) to read as follows: 
‘‘(1) the term ‘Federal financial institutions reg-
ulatory agencies’— 
‘‘(A) means the Office of the Comptroller of 
the Currency, the Board of Governors of the Fed-
eral Reserve System, the Federal Deposit Insur-
ance Corporation, and the National Credit 
Union Administration; and 
‘‘(B) for purposes of sections 1012, 1013, 
1014, and 1015, includes the Consumer Law En-
forcement Agency;’’; and 
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(B) in section 1005, by striking ‘‘One-fifth’’ 
and inserting ‘‘One-fourth’’. 
Subtitle I—National Credit Union 
Administration Budget Trans-
parency 
SEC. 541. BUDGET TRANSPARENCY FOR THE NCUA. 
Section 209(b) of the Federal Credit Union Act (12 
U.S.C. 1789) is amended— 
(1) by redesignating paragraphs (1) and (2) as 
paragraphs (2) and (3), respectively; 
(2) by inserting before paragraph (2), as so re-
designated, the following: 
‘‘(1) on an annual basis and prior to the sub-
mission of the detailed business-type budget required 
under paragraph (2)— 
‘‘(A) make publicly available and cause to 
be printed in the Federal Register a draft of such 
detailed business-type budget; and 
‘‘(B) hold a public hearing, with public no-
tice provided of such hearing, wherein the public 
can submit comments on the draft of such de-
tailed business-type budget;’’; and 
(3) in paragraph (2), as so redesignated— 
(A) by inserting ‘‘detailed’’ after ‘‘submit 
a’’; and 
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(B) by inserting ‘‘, and where such budget 
shall address any comments submitted by the 
public pursuant to paragraph (1)(B)’’ after 
‘‘Control Act’’. 
Subtitle J—Taking Account of Insti-
tutions With Low Operation Risk 
SEC. 546. REGULATIONS APPROPRIATE TO BUSINESS MOD-
ELS. 
(a) IN GENERAL.—For any regulatory action occur-
ring after the date of the enactment of this Act, each Federal 
financial institutions regulatory agency shall— 
(1) take into consideration the risk profile and 
business models of each type of institution or class of 
institutions subject to the regulatory action; 
(2) determine the necessity, appropriateness, and 
impact of applying such regulatory action to such in-
stitutions or classes of institutions; and 
(3) tailor such regulatory action in a manner 
that limits the regulatory compliance impact, cost, li-
ability risk, and other burdens, as appropriate, for 
the risk profile and business model of the institution 
or class of institutions involved. 
(b) OTHER CONSIDERATIONS.—In carrying out the re-
quirements of subsection (a), each Federal financial institu-
tions regulatory agency shall consider— 
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304 
(1) the impact that such regulatory action, both 
by itself and in conjunction with the aggregate effect 
of other regulations, has on the ability of the applica-
ble institution or class of institutions to serve evolving 
and diverse customer needs; 
(2) the potential impact of examination manu-
als, regulatory actions taken with respect to third- 
party service providers, or other regulatory directives 
that may be in conflict or inconsistent with the tai-
loring of such regulatory action described in sub-
section (a)(3); and 
(3) the underlying policy objectives of the regu-
latory action and statutory scheme involved. 
(c) NOTICE OF PROPOSED AND FINAL RULEMAKING.— 
Each Federal financial institutions regulatory agency shall 
disclose in every notice of proposed rulemaking and in any 
final rulemaking for a regulatory action how the agency 
has applied subsections (a) and (b). 
(d) REPORTS TO CONGRESS.— 
(1) INDIVIDUAL AGENCY REPORTS.— 
(A) IN GENERAL.—Not later than 1 year 
after the date of the enactment of this Act and 
annually thereafter, each Federal financial insti-
tutions regulatory agency shall report to the 
Committee on Financial Services of the House of 
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Representatives and the Committee on Banking, 
Housing, and Urban Affairs of the Senate on the 
specific actions taken to tailor the regulatory ac-
tions of the agency pursuant to the requirements 
of this Act. 
(B) APPEARANCE
BEFORE
THE
COMMIT-
TEES.—The head of each Federal financial insti-
tution regulatory agency shall appear before the 
Committee on Financial Services of the House of 
Representatives and the Committee on Banking, 
Housing, and Urban Affairs of the Senate after 
each report is made pursuant to subparagraph 
(A) to testify on the contents of such report. 
(2) FIEC REPORTS.— 
(A) IN GENERAL.—Not later than 3 months 
after each report is submitted under paragraph 
(1), the Financial Institutions Examination 
Council shall report to the Committee on Finan-
cial Services of the House of Representatives and 
the Committee on Banking, Housing, and Urban 
Affairs of the Senate on— 
(i) the extent to which regulatory ac-
tions tailored pursuant to this Act result in 
different treatment of similarly situated in-
stitutions of diverse charter types; and 
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(ii) the reasons for such differential 
treatment. 
(B) APPEARANCE
BEFORE
THE
COMMIT-
TEES.—The Chairman of the Financial Institu-
tions Examination Council shall appear before 
the Committee on Financial Services of the 
House of Representatives and the Committee on 
Banking, Housing, and Urban Affairs of the 
Senate after each report is made pursuant to 
subparagraph (A) to testify on the contents of 
such report. 
(e) LIMITED LOOK-BACK APPLICATION.— 
(1) IN GENERAL.—Each Federal financial insti-
tutions regulatory agency shall conduct a review of 
all regulations adopted during the period beginning 
on the date that is seven years before the date of the 
introduction of this Act in the House of Representa-
tives and ending on the date of the enactment of this 
Act, and apply the requirements of this Act to such 
regulations. 
(2) REVISION.—If the application of the require-
ments of this Act to any such regulation requires such 
regulation to be revised, the applicable Federal finan-
cial institutions regulatory agency shall revise such 
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307 
regulation within 3 years of the enactment of this 
Act. 
(f) DEFINITIONS.—In this Act, the following defini-
tions shall apply: 
(1) FEDERAL
FINANCIAL
INSTITUTIONS
REGU-
LATORY AGENCIES.—The term ‘‘Federal financial in-
stitutions regulatory agencies’’ means the Office of the 
Comptroller of the Currency, the Board of Governors 
of the Federal Reserve System, the Federal Deposit 
Insurance Corporation, the National Credit Union 
Administration, and the Consumer Law Enforcement 
Agency. 
(2) REGULATORY ACTION.—The term ‘‘regulatory 
action’’ means any proposed, interim, or final rule or 
regulation, guidance, or published interpretation. 
Subtitle K—Federal Savings 
Association Charter Flexibility 
SEC. 551. OPTION FOR FEDERAL SAVINGS ASSOCIATIONS 
TO OPERATE AS A COVERED SAVINGS ASSO-
CIATION. 
The Home Owners’ Loan Act is amended by inserting 
after section 5 (12 U.S.C. 1464) the following: 
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‘‘SEC. 5A. ELECTION TO OPERATE AS A COVERED SAVINGS 
ASSOCIATION. 
‘‘(a) DEFINITION.—In this section, the term ‘covered 
savings association’ means a Federal savings association 
that makes an election approved under subsection (b). 
‘‘(b) ELECTION.— 
‘‘(1) IN GENERAL.—Upon issuance of the rules 
described in subsection (f), a Federal savings associa-
tion may elect to operate as a covered savings associa-
tion by submitting a notice to the Comptroller of such 
election. 
‘‘(2) APPROVAL.—A Federal savings association 
shall be deemed to be approved to operate as a covered 
savings association on the date that is 60 days after 
the date on which the Comptroller receives the notice 
under paragraph (1), unless the Comptroller notifies 
the Federal savings association otherwise. 
‘‘(c) RIGHTS
AND DUTIES.—Notwithstanding any 
other provision of law and except as otherwise provided in 
this section, a covered savings association shall— 
‘‘(1) have the same rights and privileges as a na-
tional bank that has its main office situated in the 
same location as the home office of the covered savings 
association; and 
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‘‘(2) be subject to the same duties, restrictions, 
penalties, liabilities, conditions, and limitations that 
would apply to such a national bank. 
‘‘(d) TREATMENT
OF COVERED SAVINGS ASSOCIA-
TIONS.—A covered savings association shall be treated as 
a Federal savings association for the purposes— 
‘‘(1) of governance of the covered savings associa-
tion, including incorporation, bylaws, boards of direc-
tors, shareholders, and distribution of dividends; 
‘‘(2) of consolidation, merger, dissolution, conver-
sion (including conversion to a stock bank or to an-
other charter), conservatorship, and receivership; and 
‘‘(3) determined by regulation of the Comptroller. 
‘‘(e) EXISTING BRANCHES.—A covered savings associa-
tion may continue to operate any branch or agency the cov-
ered savings association operated on the date on which an 
election under subsection (b) is approved. 
‘‘(f) RULEMAKING.—The Comptroller shall issue rules 
to carry out this section— 
‘‘(1) that establish streamlined standards and 
procedures that clearly identify required documenta-
tion or timelines for an election under subsection (b); 
‘‘(2) that require a Federal savings association 
that makes an election under subsection (b) to iden-
tify specific assets and subsidiaries— 
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‘‘(A) that do not conform to the require-
ments for assets and subsidiaries of a national 
bank; and 
‘‘(B) that are held by the Federal savings 
association on the date on which the Federal sav-
ings association submits a notice of such election; 
‘‘(3) that establish— 
‘‘(A) a transition process for bringing such 
assets and subsidiaries into conformance with 
the requirements for a national bank; and 
‘‘(B) procedures for allowing the Federal 
savings association to provide a justification for 
grandfathering such assets and subsidiaries after 
electing to operate as a covered savings associa-
tion; 
‘‘(4) that establish standards and procedures to 
allow a covered savings association to terminate an 
election under subsection (b) after an appropriate pe-
riod of time or to make a subsequent election; 
‘‘(5) that clarify requirements for the treatment 
of covered savings associations, including the provi-
sions of law that apply to covered savings associa-
tions; and 
‘‘(6) as the Comptroller deems necessary and in 
the interests of safety and soundness.’’. 
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311 
Subtitle L—SAFE Transitional 
Licensing 
SEC. 556. ELIMINATING BARRIERS TO JOBS FOR LOAN 
ORIGINATORS. 
(a) IN GENERAL.—The S.A.F.E. Mortgage Licensing 
Act of 2008 (12 U.S.C. 5101 et seq.) is amended by adding 
at the end the following: 
‘‘SEC. 1518. EMPLOYMENT TRANSITION OF LOAN ORIGINA-
TORS. 
‘‘(a) TEMPORARY AUTHORITY TO ORIGINATE LOANS 
FOR LOAN ORIGINATORS MOVING FROM A DEPOSITORY IN-
STITUTION TO A NON-DEPOSITORY INSTITUTION.— 
‘‘(1) IN
GENERAL.—Upon employment by a 
State-licensed mortgage company, an individual who 
is a registered loan originator shall be deemed to have 
temporary authority to act as a loan originator in an 
application State for the period described in para-
graph (2) if the individual— 
‘‘(A) has not had an application for a loan 
originator license denied, or had such a license 
revoked or suspended in any governmental juris-
diction; 
‘‘(B) has not been subject to or served with 
a cease and desist order in any governmental ju-
risdiction or as described in section 1514(c); 
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‘‘(C) has not been convicted of a felony that 
would preclude licensure under the law of the ap-
plication State; 
‘‘(D) has submitted an application to be a 
State-licensed loan originator in the application 
State; and 
‘‘(E) was registered in the Nationwide 
Mortgage Licensing System and Registry as a 
loan originator during the 12-month period pre-
ceding the date of submission of the information 
required under section 1505(a). 
‘‘(2) PERIOD.—The period described in para-
graph (1) shall begin on the date that the individual 
submits the information required under section 
1505(a) and shall end on the earliest of— 
‘‘(A) the date that the individual withdraws 
the application to be a State-licensed loan origi-
nator in the application State; 
‘‘(B) the date that the application State de-
nies, or issues a notice of intent to deny, the ap-
plication; 
‘‘(C) the date that the application State 
grants a State license; or 
‘‘(D) the date that is 120 days after the date 
on which the individual submits the application, 
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313 
if the application is listed on the Nationwide 
Mortgage Licensing System and Registry as in-
complete. 
‘‘(b) TEMPORARY AUTHORITY TO ORIGINATE LOANS 
FOR STATE-LICENSED LOAN ORIGINATORS MOVING INTER-
STATE.— 
‘‘(1) IN GENERAL.—A State-licensed loan origi-
nator shall be deemed to have temporary authority to 
act as a loan originator in an application State for 
the period described in paragraph (2) if the State-li-
censed loan originator— 
‘‘(A) meets the requirements of subpara-
graphs (A), (B), (C), and (D) of subsection 
(a)(1); 
‘‘(B) is employed by a State-licensed mort-
gage company in the application State; and 
‘‘(C) was licensed in a State that is not the 
application State during the 30-day period pre-
ceding the date of submission of the information 
required under section 1505(a) in connection 
with the application submitted to the application 
State. 
‘‘(2) PERIOD.—The period described in para-
graph (1) shall begin on the date that the State-li-
censed loan originator submits the information re-
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quired under section 1505(a) in connection with the 
application submitted to the application State and 
end on the earliest of— 
‘‘(A) the date that the State-licensed loan 
originator withdraws the application to be a 
State-licensed loan originator in the application 
State; 
‘‘(B) the date that the application State de-
nies, or issues a notice of intent to deny, the ap-
plication; 
‘‘(C) the date that the application State 
grants a State license; or 
‘‘(D) the date that is 120 days after the date 
on which the State-licensed loan originator sub-
mits the application, if the application is listed 
on the Nationwide Mortgage Licensing System 
and Registry as incomplete. 
‘‘(c) APPLICABILITY.— 
‘‘(1) Any person employing an individual who is 
deemed to have temporary authority to act as a loan 
originator in an application State pursuant to this 
section shall be subject to the requirements of this title 
and to applicable State law to the same extent as if 
such individual was a State-licensed loan originator 
licensed by the application State. 
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315 
‘‘(2) Any individual who is deemed to have tem-
porary authority to act as a loan originator in an 
application State pursuant to this section and who 
engages in residential mortgage loan origination ac-
tivities shall be subject to the requirements of this title 
and to applicable State law to the same extent as if 
such individual was a State-licensed loan originator 
licensed by the application State. 
‘‘(d) DEFINITIONS.—In this section, the following defi-
nitions shall apply: 
‘‘(1) STATE-LICENSED
MORTGAGE
COMPANY.— 
The term ‘State-licensed mortgage company’ means 
an entity licensed or registered under the law of any 
State to engage in residential mortgage loan origina-
tion and processing activities. 
‘‘(2) APPLICATION STATE.—The term ‘applica-
tion State’ means a State in which a registered loan 
originator or a State-licensed loan originator seeks to 
be licensed.’’. 
(b) TABLE OF CONTENTS AMENDMENT.—The table of 
contents in section 1(b) of the Housing and Economic Re-
covery Act of 2008 (42 U.S.C. 4501 note) is amended by 
inserting after the item relating to section 1517 the fol-
lowing: 
‘‘Sec. 1518. Employment transition of loan originators.’’. 
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316 
(c) AMENDMENT TO CIVIL LIABILITY OF THE CON-
SUMER LAW ENFORCEMENT AGENCY AND OTHER OFFI-
CIALS.—Section 1513 of the S.A.F.E. Mortgage Licensing 
Act of 2008 (12 U.S.C. 5112) is amended by striking ‘‘are 
loan originators or are applying for licensing or registra-
tion as loan originators’’ and inserting ‘‘are applying for 
licensing or registration using the Nationwide Mortgage Li-
censing System and Registry’’. 
Subtitle M—Right to Lend 
SEC. 561. SMALL BUSINESS LOAN DATA COLLECTION RE-
QUIREMENT. 
(a) REPEAL.—Section 704B of the Equal Credit Op-
portunity Act (15 U.S.C. 1691c–2) is repealed. 
(b) CONFORMING AMENDMENTS.—Section 701(b) of the 
Equal Credit Opportunity Act (15 U.S.C. 1691(b)) is 
amended— 
(1) in paragraph (3), by inserting ‘‘or’’ at the 
end; 
(2) in paragraph (4), by striking ‘‘; or’’ and in-
serting a period; and 
(3) by striking paragraph (5). 
(c) CLERICAL AMENDMENT.—The table of sections for 
title VII of the Consumer Credit Protection Act is amended 
by striking the item relating to section 704B. 
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Subtitle N—Community Bank 
Reporting Relief 
SEC. 566. SHORT FORM CALL REPORT. 
(a) IN GENERAL.—Section 7(a) of the Federal Deposit 
Insurance Act (12 U.S.C. 1817(a)) is amended by adding 
at the end the following: 
‘‘(12) SHORT FORM REPORTING.— 
‘‘(A) IN GENERAL.—The appropriate Fed-
eral banking agencies shall issue regulations al-
lowing for a reduced reporting requirement for 
covered depository institutions when making the 
first and third report of condition for a year, as 
required pursuant to paragraph (3). 
‘‘(B) COVERED
DEPOSITORY
INSTITUTION 
DEFINED.—For purposes of this paragraph, the 
term ‘covered depository institution’ means an 
insured depository institution that— 
‘‘(i) is well capitalized (as defined 
under section 38(b)); and 
‘‘(ii) satisfies such other criteria as the 
appropriate Federal banking agencies deter-
mine appropriate.’’. 
(b) REPORT TO CONGRESS.—Not later than 180 days 
after the date of the enactment of this Act, and every 365 
days thereafter until the appropriate Federal banking agen-
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cies (as defined under section 3 of the Federal Deposit In-
surance Act) have issued the regulations required under sec-
tion 7(a)(12)(A) of the Federal Deposit Insurance Act, such 
agencies shall submit to the Committee on Financial Serv-
ices of the House of Representatives and the Committee on 
Banking, Housing, and Urban Affairs of the Senate a re-
port describing the progress made in issuing such regula-
tions. 
Subtitle O—Homeowner 
Information Privacy Protection 
SEC. 571. STUDY REGARDING PRIVACY OF INFORMATION 
COLLECTED UNDER THE HOME MORTGAGE 
DISCLOSURE ACT OF 1975. 
(a) STUDY.—The Comptroller General of the United 
States shall conduct a study to determine whether the data 
required to be published, made available, or disclosed under 
the final rule, in connection with other publicly available 
data sources, including data made publicly available under 
Regulation C (12 C.F.R. 1003) before the effective date of 
the final rule, could allow for or increase the probability 
of— 
(1) exposure of the identity of mortgage appli-
cants or mortgagors through reverse engineering; 
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(2) exposure of mortgage applicants or mortga-
gors to identity theft or the loss of sensitive personal 
financial information; 
(3) the marketing or sale of unfair or deceptive 
financial products to mortgage applicants or mortga-
gors based on such data; 
(4) personal financial loss or emotional distress 
resulting from the exposure of mortgage applicants or 
mortgagors to identify theft or the loss of sensitive 
personal financial information; and 
(5) the potential legal liability facing the Con-
sumer Law Enforcement Agency and market partici-
pants in the event the data required to be published, 
made available, or disclosed under the final rule leads 
or contributes to identity theft or the capture of sen-
sitive personal financial information. 
(b) REPORT.—The Comptroller General of the United 
States shall submit to the Committee on Financial Services 
of the House of Representatives and the Committee on 
Banking, Housing, and Urban Affairs of the Senate a re-
port that includes— 
(1) the findings and conclusions of the Comp-
troller General with respect to the study required 
under subsection (a); and 
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(2) any recommendations for legislative or regu-
latory actions that— 
(A) would enhance the privacy of a con-
sumer when accessing mortgage credit; and 
(B) are consistent with consumer protec-
tions and safe and sound banking operations. 
(c) SUSPENSION
OF
DATA
SHARING
REQUIRE-
MENTS.—Notwithstanding any other provision of law, in-
cluding the final rule— 
(1) depository institutions shall not be required 
to publish, disclose, or otherwise make available to the 
public, pursuant to the Home Mortgage Disclosure 
Act of 1975 (or regulations issued under such Act) 
any data that was not required to be published, dis-
closed, or otherwise made available pursuant to such 
Act (or regulations issued under such Act) on the day 
before the date of the enactment of the Dodd-Frank 
Wall Street Reform and Consumer Protection Act; 
and 
(2) the Consumer Law Enforcement Agency and 
the Financial Institutions Examination Council shall 
not publish, disclose, or otherwise make available to 
the public any such information received from a de-
pository institution pursuant to the final rule. 
(d) DEFINITIONS.—For purposes of this section: 
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(1) DEPOSITORY INSTITUTION.—The term ‘‘de-
pository institution’’ has the meaning given that term 
under section 303 of the Home Mortgage Disclosure 
Act of 1975 (12 U.S.C. 2802). 
(2) FINAL RULE.—The term ‘‘final rule’’ means 
the final rule issued by the Bureau of Consumer Fi-
nancial Protection titled ‘‘Home Mortgage Disclosure 
(Regulation C)’’ (October 28, 2015; 80 Fed. Reg. 
66128). 
Subtitle P—Home Mortgage 
Disclosure Adjustment 
SEC. 576. DEPOSITORY INSTITUTIONS SUBJECT TO MAINTE-
NANCE OF RECORDS AND DISCLOSURE RE-
QUIREMENTS. 
(a) IN GENERAL.—Section 304 of the Home Mortgage 
Disclosure Act of 1975 (12 U.S.C. 2803) is amended— 
(1) by redesignating subsection (i) as paragraph 
(2) and adjusting the margin appropriately; and 
(2) by inserting before such paragraph (2) the 
following: 
‘‘(i) EXEMPTIONS.— 
‘‘(1) IN GENERAL.—With respect to a depository 
institution, the requirements of subsections (a) and 
(b) shall not apply— 
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‘‘(A) with respect to closed-end mortgage 
loans, if such depository institution originated 
less than 100 closed-end mortgage loans in each 
of the two preceding calendar years; and 
‘‘(B) with respect to open-end lines of cred-
it, if such depository institution originated less 
than 200 open-end lines of credit in each of the 
two preceding calendar years.’’. 
(b) TECHNICAL CORRECTION.—Section 304(i)(2) of 
such Act, as redesignated by subsection (a), is amended by 
striking ‘‘section 303(2)(A)’’ and inserting ‘‘section 
303(3)(A)’’. 
Subtitle Q—Protecting Consumers’ 
Access to Credit 
SEC. 581. RATE OF INTEREST AFTER TRANSFER OF LOAN. 
(a) AMENDMENT TO THE REVISED STATUTES.—Sec-
tion 5197 of the Revised Statutes of the United States (12 
U.S.C. 85) is amended by adding at the end the following 
new sentence: ‘‘A loan that is valid when made as to its 
maximum rate of interest in accordance with this section 
shall remain valid with respect to such rate regardless of 
whether the loan is subsequently sold, assigned, or otherwise 
transferred to a third party, and may be enforced by such 
third party notwithstanding any State law to the con-
trary.’’. 
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(b) AMENDMENT
TO
THE HOME OWNERS’ LOAN 
ACT.—Section 4(g)(1) of the Home Owners’ Loan Act (12 
U.S.C. 1463(g)(1)) is amended by adding at the end the 
following new sentence: ‘‘A loan that is valid when made 
as to its maximum rate of interest in accordance with this 
subsection shall remain valid with respect to such rate re-
gardless of whether the loan is subsequently sold, assigned, 
or otherwise transferred to a third party, and may be en-
forced by such third party notwithstanding any State law 
to the contrary.’’. 
(c) AMENDMENT TO THE FEDERAL CREDIT UNION 
ACT.—Section 205(g)(1) of the Federal Credit Union Act 
(12 U.S.C. 1785(g)(1)) is amended by adding at the end 
the following new sentence: ‘‘A loan that is valid when made 
as to its maximum rate of interest in accordance with this 
subsection shall remain valid with respect to such rate re-
gardless of whether the loan is subsequently sold, assigned, 
or otherwise transferred to a third party, and may be en-
forced by such third party notwithstanding any State law 
to the contrary.’’. 
(d) AMENDMENT TO THE FEDERAL DEPOSIT INSUR-
ANCE ACT.—Section 27(a) of the Federal Deposit Insurance 
Act (12 U.S.C. 1831d(a)) is amended by adding at the end 
the following new sentence: ‘‘A loan that is valid when made 
as to its maximum rate of interest in accordance with this 
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section shall remain valid with respect to such rate regard-
less of whether the loan is subsequently sold, assigned, or 
otherwise transferred to a third party, and may be enforced 
by such third party notwithstanding any State law to the 
contrary.’’. 
Subtitle R—NCUA Overhead 
Transparency 
SEC. 586. FUND TRANSPARENCY. 
Section 203 of the Federal Credit Union Act (12 
U.S.C. 1783) is amended by adding at the end the following: 
‘‘(g) FUND TRANSPARENCY.— 
‘‘(1) IN GENERAL.—The Board shall accompany 
each annual budget submitted pursuant to section 
209(b) with a report containing— 
‘‘(A) a detailed analysis of how the expenses 
of the Administration are assigned between pru-
dential activities and insurance-related activities 
and the extent to which those expenses are paid 
from the fees collected pursuant to section 105 or 
from the Fund; and 
‘‘(B) the Board’s supporting rationale for 
any proposed use of amounts in the Fund con-
tained in such budget, including detailed break-
downs and supporting rationales for any such 
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proposed use related to titles of this Act other 
than this title. 
‘‘(2) PUBLIC
DISCLOSURE.—The Board shall 
make each report described under paragraph (1) 
available to the public.’’. 
Subtitle S—Housing Opportunities 
Made Easier 
SEC. 591. CLARIFICATION OF DONATED SERVICES TO NON- 
PROFITS. 
Section 129E(i) of the Truth in Lending Act (15 
U.S.C. 1639e(i)) is amended by adding at the end the fol-
lowing: 
‘‘(4) RULE OF CONSTRUCTION RELATED TO AP-
PRAISAL DONATIONS.—For purposes of paragraph (1), 
if a fee appraiser voluntarily donates appraisal serv-
ices to an organization described in section 170(c)(2) 
of the Internal Revenue Code of 1986, such voluntary 
donation shall be deemed customary and reasonable.’’. 
TITLE VI—REGULATORY RELIEF 
FOR STRONGLY CAPITALIZED, 
WELL MANAGED BANKING OR-
GANIZATIONS 
SEC. 601. CAPITAL ELECTION. 
(a) IN GENERAL.—A banking organization may make 
an election under this section to be treated as a qualifying 
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banking organization for purposes of the regulatory relief 
described under section 602. 
(b) REQUIREMENTS.—A banking organization may 
qualify to be treated as a qualifying banking organization 
if— 
(1) the banking organization has an average le-
verage ratio of at least 10 percent; 
(2) with respect to a depository institution hold-
ing company, each insured depository institution sub-
sidiary of the holding company simultaneously makes 
the election described under subsection (a); and 
(3) with respect to an insured depository institu-
tion, any parent depository institution holding com-
pany of the institution simultaneously makes the elec-
tion described under subsection (a). 
(c) ELECTION PROCESS.—To make an election under 
this section, a banking organization shall submit an elec-
tion to the appropriate Federal banking agency (and any 
applicable State bank supervisor that regulates the banking 
organization) containing— 
(1) a notice of such election; 
(2) the banking organization’s average leverage 
ratio, as well as the organization’s quarterly leverage 
ratio for each of the most recently completed four cal-
endar quarters; 
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(3) if the banking organization is a depository 
institution holding company, the information de-
scribed under paragraph (2) for each of the organiza-
tion’s insured depository institution subsidiaries; and 
(4) if the banking organization is an insured de-
pository institution, the information described under 
paragraph (2) for any parent depository institution 
holding company of the institution. 
(d) EFFECTIVE DATE OF ELECTION.— 
(1) IN GENERAL.—An election made under this 
section shall take effect at the end of the 30-day pe-
riod beginning on the date that the appropriate Fed-
eral banking agency receives the application described 
under subsection (c), unless the appropriate Federal 
banking agency determines that the banking organi-
zation has not met the requirements described under 
subsection (b). 
(2) NOTICE
OF
FAILURE
TO
MEET
REQUIRE-
MENTS.—If the appropriate Federal banking agency 
determines that a banking organization submitting 
an election notice under subsection (c) does not meet 
the requirements described under subsection (b), the 
agency shall— 
(A) notify the banking organization (and 
any applicable State bank supervisor that regu-
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lates the banking organization), in writing, of 
such determination as soon as possible after such 
determination is made, but in no case later than 
the end of the 30-day period beginning on the 
date that the appropriate Federal banking agen-
cy receives the election; and 
(B) include in such notification the specific 
reasons for such determination and steps that the 
banking organization can take to meet such re-
quirements. 
(e) TREATMENT OF CERTAIN NEW BANKING ORGANI-
ZATIONS.—In the case of a banking organization that is 
a newly-chartered insured depository institution or a bank-
ing organization that becomes a banking organization be-
cause it controls a newly-chartered insured depository insti-
tution, such banking organization may be treated as a 
qualifying banking organization immediately upon becom-
ing a banking organization, if— 
(1) an election to be treated as a qualifying 
banking organization was included in the application 
filed with the appropriate Federal banking agency in 
connection with becoming a banking organization; 
and 
(2) as of the date the banking organization be-
comes a banking organization, the banking organiza-
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tion’s tangible equity divided by the banking organi-
zation’s leverage exposure, expressed as a percentage, 
is at least 10 percent. 
(f) FAILURE
TO MAINTAIN QUARTERLY LEVERAGE 
RATIO AND LOSS OF ELECTION.— 
(1) EFFECT
OF
FAILURE
TO
MAINTAIN
QUAR-
TERLY LEVERAGE RATIO.— 
(A) IN GENERAL.—If, with respect to the 
most recently completed calendar quarter, the 
appropriate Federal banking agency determines 
that a qualifying banking organization’s quar-
terly leverage ratio is below 10 percent— 
(i) the appropriate Federal banking 
agency shall notify the qualifying banking 
organization and any applicable State bank 
supervisor that regulates the banking orga-
nization of such determination; 
(ii) the appropriate Federal banking 
agency may prohibit the banking organiza-
tion from making a capital distribution; 
and 
(iii) the banking organization shall, 
within 3 months of the first such determina-
tion, submit a capital restoration plan to 
the appropriate Federal banking agency. 
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(B) LOSS OF ELECTION AFTER ONE-YEAR 
REMEDIATION PERIOD.—If a banking organiza-
tion described under subparagraph (A) does not, 
within the 1-year period beginning on the date 
of such determination, raise the organization’s 
quarterly leverage ratio for a calendar quarter 
ending in such 1-year period to at least 10 per-
cent, the banking organization’s election under 
this section shall be terminated, and the appro-
priate Federal banking agency shall notify any 
applicable State bank supervisor that regulates 
the banking organization of such termination. 
(C) EFFECT OF SUBSIDIARY ON PARENT OR-
GANIZATION.—With respect to a qualifying bank-
ing organization described under subparagraph 
(A) that is an insured depository institution, 
any parent depository institution holding com-
pany of the qualifying banking organization 
shall— 
(i) if the appropriate Federal banking 
agency determines it appropriate, be pro-
hibited from making a capital distribution 
(other than a capital contribution to such 
qualifying banking organization described 
under subparagraph (A)); and 
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(ii) if the qualifying banking organiza-
tion has an election terminated under sub-
paragraph (B), any such parent depository 
institution holding company shall also have 
its election under this section terminated. 
(2) IMMEDIATE
LOSS
OF
ELECTION
IF
THE 
QUARTERLY LEVERAGE RATIO FALLS BELOW 6 PER-
CENT.— 
(A) IN GENERAL.—If, with respect to the 
most recently completed calendar quarter, the 
appropriate Federal banking agency determines 
that a qualifying banking organization’s quar-
terly leverage ratio is below 6 percent, the bank-
ing organization’s election under this section 
shall be terminated, and the appropriate Federal 
banking agency shall notify any applicable State 
bank supervisor that regulates the banking orga-
nization of such termination. 
(B) EFFECT OF SUBSIDIARY ON PARENT OR-
GANIZATION.—With respect to a qualifying bank-
ing organization described under subparagraph 
(A) that is an insured depository institution, 
any parent depository institution holding com-
pany of the qualifying banking organization 
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shall also have its election under this section ter-
minated. 
(3) ABILITY TO MAKE FUTURE ELECTIONS.—If a 
banking organization has an election under this sec-
tion terminated, the banking organization may not 
apply for another election under this section until the 
banking organization has maintained a quarterly le-
verage ratio of at least 10 percent for 8 consecutive 
calendar quarters. 
SEC. 602. REGULATORY RELIEF. 
(a) IN GENERAL.—A qualifying banking organization 
shall be exempt from the following: 
(1) Any Federal law, rule, or regulation address-
ing capital or liquidity requirements or standards. 
(2) Any Federal law, rule, or regulation that 
permits an appropriate Federal banking agency to 
object to a capital distribution. 
(3) Any consideration by an appropriate Federal 
banking agency of the following: 
(A) Any risk the qualifying banking organi-
zation may pose to ‘‘the stability of the financial 
system of the United States’’, under section 
5(c)(2) of the Bank Holding Company Act of 
1956. 
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333 
(B) The ‘‘extent to which a proposed acqui-
sition, merger, or consolidation would result in 
greater or more concentrated risks to the sta-
bility of the United States banking or financial 
system’’, under section 3(c)(7) of the Bank Hold-
ing Company Act of 1956, so long as the banking 
organization, after such proposed acquisition, 
merger, or consolidation, would maintain a 
quarterly leverage ratio of at least 10 percent. 
(C) Whether the performance of an activity 
by the banking organization could possibly pose 
a ‘‘risk to the stability of the United States 
banking or financial system’’, under section 
4(j)(2)(A) of the Bank Holding Company Act of 
1956. 
(D) Whether the acquisition of control of 
shares of a company engaged in an activity de-
scribed in section 4(j)(1)(A) of the Bank Holding 
Company Act of 1956 could possibly pose a ‘‘risk 
to the stability of the United States banking or 
financial system’’, under section 4(j)(2)(A) of the 
Bank Holding Company Act of 1956, so long as 
the banking organization, after acquiring control 
of such company, would maintain a quarterly le-
verage ratio of at least 10 percent. 
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334 
(E) Whether a merger would pose a ‘‘risk to 
the stability of the United States banking or fi-
nancial system’’, under section 18(c)(5) of the 
Federal Deposit Insurance Act, so long as the 
banking organization, after such proposed merg-
er, would maintain a quarterly leverage ratio of 
at least 10 percent. 
(F) Any risk the qualifying banking organi-
zation may pose to ‘‘the stability of the financial 
system of the United States’’, under section 
10(b)(4) of the Home Owners’ Loan Act. 
(4) Subsections (i)(8) and (k)(6)(B)(ii) of section 
4 and section 14 of the Bank Holding Company Act 
of 1956. 
(5) Section 18(c)(13) of the Federal Deposit In-
surance Act. 
(6) Section 163 of the Financial Stability Act of 
2010. 
(7) Section 10(e)(2)(E) of the Home Owners’ 
Loan Act. 
(8) Any Federal law, rule, or regulation imple-
menting standards of the type provided for in sub-
sections (b), (c), (d), (e), (g), (h), (i), and (j) of sec-
tion 165 of the Financial Stability Act of 2010. 
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335 
(9) Any Federal law, rule, or regulation pro-
viding limitations on mergers, consolidations, or ac-
quisitions of assets or control, to the extent such limi-
tations relate to capital or liquidity standards or con-
centrations of deposits or assets, so long as the bank-
ing organization, after such proposed merger, consoli-
dation, or acquisition, would maintain a quarterly 
leverage ratio of at least 10 percent. 
(b) QUALIFYING BANKING ORGANIZATIONS TREATED 
AS WELL CAPITALIZED.—A qualifying banking organiza-
tion shall be deemed to be ‘‘well capitalized’’ for purposes 
of— 
(1) section 216 of the Federal Credit Union Act; 
and 
(2) sections 29, 38, 44, and 46 of the Federal De-
posit Insurance Act. 
(c) TREATMENT OF CERTAIN RISK-WEIGHTED ASSET 
REQUIREMENTS
FOR QUALIFYING BANKING ORGANIZA-
TIONS.— 
(1) ACQUISITION SIZE CRITERIA TREATMENT.— 
A qualifying banking organization shall be deemed to 
meet the criteria described under section 4(j)(4)(D) of 
the Bank Holding Company Act of 1956, so long as 
after the proposed transaction the acquiring quali-
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336 
fying banking organization would maintain a quar-
terly leverage ratio of at least 10 percent. 
(2) USE OF LEVERAGE EXPOSURE.—With respect 
to a qualifying banking organization, in determining 
whether a proposal qualifies with the criteria de-
scribed under subparagraphs (A)(iii) and (B)(i) of 
section 4(j)(4) of the Bank Holding Company Act of 
1956, the Board of Governors of the Federal Reserve 
System shall consider the leverage exposure of an in-
sured depository institution instead of the total risk- 
weighted assets of such institution. 
SEC. 603. CONTINGENT CAPITAL STUDY. 
(a) STUDY.—The Board of Governors of the Federal 
Reserve System, the Federal Deposit Insurance Corpora-
tion, and the Office of the Comptroller of the Currency shall 
each carry out a study, which shall include holding public 
hearings, on how to design a requirement that banking or-
ganizations issue contingent capital with a market-based 
conversion trigger. 
(b) REPORT.—Not later than the end of the 1-year pe-
riod beginning on the date of the enactment of this Act, 
each agency described under subsection (a) shall submit a 
report to the Congress containing— 
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(1) all findings and determinations made by the 
agency in carrying out the study required under sub-
section (a); and 
(2) the agency’s recommendations on how the 
Congress should design a requirement that banking 
organizations issue contingent capital with a market- 
based conversion trigger. 
SEC. 604. STUDY ON ALTERING THE CURRENT PROMPT 
CORRECTIVE ACTION RULES. 
(a) STUDY.—The Comptroller General of the United 
States shall conduct a study to assess the benefits and feasi-
bility of altering the current prompt corrective action rules 
and replacing the Basel-based capital ratios with the non-
performing asset coverage ratio or NACR as the trigger for 
specific required supervisory interventions. The Comptroller 
General shall ensure that such study includes the following: 
(1) An assessment of the performance of an 
NACR forward-looking measure of a banking organi-
zation’s solvency condition relative to the regulatory 
capital ratios currently used by prompt corrective ac-
tion rules. 
(2) An analysis of the performance of alternative 
definitions of nonperforming assets. 
(3) An assessment of the impact of two alter-
native intervention thresholds: 
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(A) An initial (high) intervention threshold, 
below which appropriate Federal banking agency 
examiners are required to intervene and assess a 
banking organization’s condition and prescribe 
remedial measures. 
(B) A lower threshold, below which banking 
organizations must increase their capital, seek 
an acquirer, or face mandatory resolution within 
90 days. 
(b) REPORT.—Not later than the end of the 1-year pe-
riod beginning on the date of the enactment of this Act, 
the Comptroller General shall submit a report to the Con-
gress containing— 
(1) all findings and determinations made in car-
rying out the study required under subsection (a); 
and 
(2) recommendations on the most suitable defini-
tion of nonperforming assets, as well as the two nu-
merical thresholds that trigger specific required super-
visory interventions. 
SEC. 605. DEFINITIONS. 
For purposes of this title: 
(1) APPROPRIATE FEDERAL BANKING AGENCY.— 
The term ‘‘appropriate Federal banking agency’’— 
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(A) has the meaning given such term under 
section 3 of the Federal Deposit Insurance Act; 
and 
(B) means the National Credit Union Ad-
ministration, in the case of an insured credit 
union. 
(2) BANKING ORGANIZATION.—The term ‘‘bank-
ing organization’’ means— 
(A) an insured depository institution; 
(B) an insured credit union; 
(C) a depository institution holding com-
pany; 
(D) a company that is treated as a bank 
holding company for purposes of section 8 of the 
International Banking Act; and 
(E) a U.S. intermediate holding company 
established by a foreign banking organization 
pursuant to section 252.153 of title 12, Code of 
Federal Regulations. 
(3) FOREIGN EXCHANGE SWAP .—The term ‘‘for-
eign exchange swap’’ has the meaning given that term 
under section 1a of the Commodity Exchange Act. 
(4) INSURED CREDIT UNION.—The term ‘‘insured 
credit union’’ has the meaning given that term under 
section 101 of the Federal Credit Union Act. 
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340 
(5) LEVERAGE EXPOSURE.—The term ‘‘leverage 
exposure’’— 
(A) with respect to a banking organization 
other than an insured credit union or a tradi-
tional banking organization, has the meaning 
given the term ‘‘total leverage exposure’’ under 
section 
3.10(c)(4)(ii), 
217.10(c)(4), 
or 
324.10(c)(4) of title 12, Code of Federal Regula-
tions, as applicable, as in effect on the date of 
the enactment of this Act; 
(B) with respect to a traditional banking 
organization other than an insured credit union, 
means total assets (minus any items deducted 
from common equity tier 1 capital) as calculated 
in accordance with generally accepted accounting 
principles and as reported on the traditional 
banking organization’s applicable regulatory fil-
ing with the banking organization’s appropriate 
Federal banking agency; and 
(C) with respect to a banking organization 
that is an insured credit union, has the meaning 
given the term ‘‘total assets’’ under section 702.2 
of title 12, Code of Federal Regulations, as in ef-
fect on the date of the enactment of this Act. 
(6) LEVERAGE RATIO DEFINITIONS.— 
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(A) AVERAGE LEVERAGE RATIO.—With re-
spect to a banking organization, the term ‘‘aver-
age leverage ratio’’ means the average of the 
banking organization’s quarterly leverage ratios 
for each of the most recently completed four cal-
endar quarters. 
(B) QUARTERLY
LEVERAGE
RATIO.—With 
respect to a banking organization and a cal-
endar quarter, the term ‘‘quarterly leverage 
ratio’’ means the organization’s tangible equity 
divided by the organization’s leverage exposure, 
expressed as a percentage, on the last day of such 
quarter. 
(7) NACR.—The term ‘‘NACR’’ means— 
(A) book equity less nonperforming assets 
plus loan loss reserves, divided by 
(B) total banking organization assets. 
(8) NONPERFORMING ASSETS.—The term ‘‘non-
performing assets’’ means— 
(A) 20 percent of assets that are past due 
30 to 89 days, plus 
(B) 50 percent of assets that are past due 
90 days or more, plus 
(C) 100 percent of nonaccrual assets and 
other real estate owned. 
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342 
(9) QUALIFYING BANKING ORGANIZATION.—The 
term ‘‘qualifying banking organization’’ means a 
banking organization that has made an election 
under section 601 and with respect to which such elec-
tion is in effect. 
(10) SECURITY-BASED SWAP .—The term ‘‘secu-
rity-based swap’’ has the meaning given that term 
under section 3 of the Securities Exchange Act of 
1934. 
(11) SWAP.—The term ‘‘swap’’ has the meaning 
given that term under section 1a of the Commodity 
Exchange Act. 
(12) TANGIBLE EQUITY.—The term ‘‘tangible eq-
uity’’— 
(A) with respect to a banking organization 
other than a credit union, means the sum of— 
(i) common equity tier 1 capital; 
(ii) additional tier 1 capital consisting 
of instruments issued on or before the date 
of enactment of this Act; and 
(iii) with respect to a depository insti-
tution holding company that had less than 
$15,000,000,000 in total consolidated assets 
as of December 31, 2009, or March 31, 
2010, or a banking organization that was a 
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mutual holding company as of May 19, 
2010, trust preferred securities issued prior 
to May 19, 2010, to the extent such organi-
zation was permitted, as of the date of the 
enactment of this Act, to consider such secu-
rities as tier 1 capital under existing regu-
lations of the appropriate Federal banking 
agency; and 
(B) with respect to a banking organization 
that is a credit union, has the meaning given the 
term ‘‘net worth’’ under section 702.2 of title 12, 
Code of Federal Regulations, as in effect on the 
date of the enactment of this Act. 
(13) TRADITIONAL
BANKING
ORGANIZATION.— 
The term ‘‘traditional banking organization’’ means a 
banking organization that— 
(A) has zero trading assets and zero trading 
liabilities; 
(B) does not engage in swaps or security- 
based swaps, other than swaps or security-based 
swaps referencing interest rates or foreign ex-
change swaps; and 
(C) has a total notional exposure of swaps 
and security-based swaps of not more than 
$8,000,000,000. 
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344 
(14) OTHER BANKING TERMS.—The terms ‘‘in-
sured depository institution’’ and ‘‘depository institu-
tion holding company’’ have the meaning given those 
terms, respectively, under section 3 of the Federal De-
posit Insurance Act. 
(15) OTHER CAPITAL TERMS.—With respect to a 
banking organization, the terms ‘‘additional tier 1 
capital’’ and ‘‘common equity tier 1 capital’’ have the 
meaning given such terms, respectively, under section 
3.20, 217.20, or 324.20 of title 12, Code of Federal 
Regulations, as applicable, as in effect on the date of 
the enactment of this Act. 
TITLE VII—EMPOWERING AMERI-
CANS TO ACHIEVE FINANCIAL 
INDEPENDENCE 
Subtitle A—Separation of Powers 
and Liberty Enhancements 
SEC. 711. CONSUMER LAW ENFORCEMENT AGENCY. 
(a) MAKING THE BUREAU AN INDEPENDENT CON-
SUMER LAW ENFORCEMENT AGENCY.—The Consumer Fi-
nancial Protection Act of 2010 (12 U.S.C. 5481 et seq.) is 
amended— 
(1) in section 1011— 
(A) in the heading of such section, by strik-
ing ‘‘BUREAU
OF
CONSUMER
FINANCIAL 
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345 
PROTECTION’’ and inserting ‘‘CONSUMER 
LAW ENFORCEMENT AGENCY’’; 
(B) in subsection (a)— 
(i) in the heading of such subsection, 
by 
striking 
‘‘BUREAU’’ 
and 
inserting 
‘‘AGENCY’’; 
(ii) by striking ‘‘in the Federal Reserve 
System,’’; 
(iii) by striking ‘‘independent bureau’’ 
and inserting ‘‘independent agency’’; and 
(iv) by striking ‘‘Bureau of Consumer 
Financial Protection’’ and inserting ‘‘Con-
sumer Law Enforcement Agency (herein-
after in this section referred to as the ‘Agen-
cy’)’’; 
(C) in subsection (b)(5), by amending sub-
paragraph (A) to read as follows: 
‘‘(A) shall be appointed by the President; 
and’’; 
(D) in subsection (c), by striking paragraph 
(3); 
(E) in subsection (e), by striking ‘‘, includ-
ing in cities in which the Federal reserve banks, 
or branches of such banks, are located,’’; and 
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346 
(F) by striking ‘‘Bureau’’ each place such 
term appears and inserting ‘‘Agency’’; and 
(2) in section 1012— 
(A) in subsection (a)(10), by striking ‘‘ex-
aminations,’’; and 
(B) by striking subsection (c). 
(b) DEEMING OF NAME.—Any reference in a law, regu-
lation, document, paper, or other record of the United 
States to the Bureau of Consumer Financial Protection 
shall be deemed a reference to the Consumer Law Enforce-
ment Agency. 
(c) CONFORMING AMENDMENTS.— 
(1) DODD-FRANK
WALL
STREET
REFORM
AND 
CONSUMER PROTECTION ACT.—The Dodd-Frank Wall 
Street Reform and Consumer Protection Act (12 
U.S.C. 5301 et seq.) is amended— 
(A) in the table of contents in section 1(b)— 
(i) by striking ‘‘Bureau of Consumer 
Financial Protection’’ each place such term 
appears and inserting ‘‘Consumer Law En-
forcement Agency’’; and 
(ii) in the table of contents relating to 
title X, in the items relating to subtitle B, 
subtitle C, and section 1027, by striking 
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‘‘Bureau’’ each place such term appears and 
inserting ‘‘Agency’’; 
(B) in section 2, by amending paragraph 
(4) to read as follows: 
‘‘(4) AGENCY.—The term ‘Agency’ means the 
Consumer Law Enforcement Agency established under 
title X.’’; 
(C) in section 342 by striking ‘‘Bureau’’ 
each place such term appears in headings and 
text and inserting ‘‘Agency’’; 
(D) in section 1400(b)— 
(i) by striking ‘‘Bureau of Consumer 
Financial Protection’’ and inserting ‘‘Con-
sumer Law Enforcement Agency’’; and 
(ii) in the subsection heading, by strik-
ing ‘‘BUREAU
OF CONSUMER FINANCIAL 
PROTECTION’’ and inserting ‘‘CONSUMER 
LAW ENFORCEMENT AGENCY’’; 
(E) in section 1411(a)(1), by striking ‘‘Bu-
reau’’ and inserting ‘‘Agency’’; and 
(F) in section 1447, by striking ‘‘Director of 
the Bureau’’ each place such term appears and 
inserting ‘‘Director of the Consumer Law En-
forcement Agency’’. 
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(2) ALTERNATIVE MORTGAGE TRANSACTION PAR-
ITY ACT OF 1982.—The Alternative Mortgage Trans-
action Parity Act of 1982 (12 U.S.C. 3801 et seq.) is 
amended— 
(A) by striking ‘‘Bureau of Consumer Fi-
nancial Protection’’ each place such term ap-
pears and inserting ‘‘Consumer Law Enforce-
ment Agency’’; and 
(B) in the subsection heading of subsection 
(d) of section 804 (12 U.S.C. 3803(d)), by strik-
ing ‘‘BUREAU’’ and inserting ‘‘AGENCY’’. 
(3) ELECTRONIC
FUND
TRANSFER
ACT.—The 
Electronic Fund Transfer Act (15 U.S.C. 1693 et seq.) 
is amended— 
(A) by amending the second paragraph (4) 
(defining the term ‘‘Bureau’’) to read as follows: 
‘‘(4) the term ‘Agency’ means the Consumer Law 
Enforcement Agency;’’; 
(B) in section 916(d)(1), by striking ‘‘Bu-
reau of Consumer Financial Protection’’ and in-
serting ‘‘Consumer Law Enforcement Agency’’; 
and 
(C) by striking ‘‘Bureau’’ each place that 
term appears in heading or text and inserting 
‘‘Agency’’. 
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349 
(4) EQUAL
CREDIT
OPPORTUNITY
ACT.—The 
Equal Credit Opportunity Act (15 U.S.C. 1691 et 
seq.) is amended— 
(A) in section 702 (15 U.S.C. 1691a), by 
amending subsection (c) to read as follows: 
‘‘(c) The term ‘Agency’ means the Consumer Law En-
forcement Agency.’’; and 
(B) by striking ‘‘Bureau’’ each place that 
term appears in heading or text and inserting 
‘‘Agency’’. 
(5) EXPEDITED FUNDS AVAILABILITY ACT.—The 
Expedited Funds Availability Act (12 U.S.C. 4001 et 
seq.) is amended— 
(A) by striking ‘‘Bureau of Consumer Fi-
nancial Protection’’ each place such term ap-
pears and inserting ‘‘Consumer Law Enforce-
ment Agency’’; and 
(B) in the heading of section 605(f)(1), by 
striking ‘‘BOARD
AND
BUREAU’’ and inserting 
‘‘BOARD AND AGENCY’’. 
(6) FAIR AND ACCURATE CREDIT TRANSACTIONS 
ACT OF 2003.—The Fair and Accurate Credit Trans-
actions Act of 2003 (Public Law 108–159) is amend-
ed by striking ‘‘Bureau’’ each place such term ap-
pears and inserting ‘‘Agency’’. 
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350 
(7) FAIR
CREDIT
REPORTING
ACT.—The Fair 
Credit Reporting Act (15 U.S.C. 1681 et seq.) is 
amended— 
(A) by amending section 603(w) to read as 
follows: 
‘‘(w) AGENCY.—The term ‘Agency’ means the Con-
sumer Law Enforcement Agency.’’; and 
(B) by striking ‘‘Bureau’’ each place such 
term appears, other than in sections 626 and 
603(v), and inserting ‘‘Agency’’. 
(8) FAIR DEBT COLLECTION PRACTICES ACT.— 
The Fair Debt Collection Practices Act (15 U.S.C. 
1692 et seq.) is amended— 
(A) by amending section 803(1) to read as 
follows: 
‘‘(1) The term ‘Agency’ means the Consumer 
Law Enforcement Agency.’’; and 
(B) by striking ‘‘Bureau’’ each place such 
term appears in heading or text and inserting 
‘‘Agency’’. 
(9) FEDERAL
DEPOSIT
INSURANCE
ACT.—The 
Federal Deposit Insurance Act (12 U.S.C. 1811 et 
seq.) is amended— 
(A) in the second paragraph (6) (with the 
heading ‘‘Referral to bureau of consumer finan-
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353 
tion’’ each place such term appears and insert-
ing ‘‘Consumer Law Enforcement Agency’’; and 
(D) 
in 
section 
1206(a) 
(12 
U.S.C. 
1833b(a)), by striking ‘‘Federal Housing Fi-
nance Board’’ and all that follows through 
‘‘Farm Credit Administration’’ and inserting 
‘‘Federal Housing Finance Board, the Consumer 
Law Enforcement Agency, and the Farm Credit 
Administration’’. 
(12) FINANCIAL LITERACY AND EDUCATION IM-
PROVEMENT ACT.—Section 513 of the Financial Lit-
eracy and Education Improvement Act (20 U.S.C. 
9702) is amended by striking ‘‘Bureau of Consumer 
Financial Protection’’ each place such term appears 
and inserting ‘‘Consumer Law Enforcement Agency’’. 
(13) GRAMM-LEACH-BLILEY ACT.—Title V of the 
Gramm-Leach-Bliley Act (15 U.S.C. 6801 et seq.) is 
amended— 
(A) by striking ‘‘Bureau of Consumer Fi-
nancial Protection’’ each place such term ap-
pears and inserting ‘‘Consumer Law Enforce-
ment Agency’’; and 
(B) 
in 
section 
505(a)(8) 
(15 
U.S.C. 
6805(a)(8)), by striking ‘‘Bureau’’ and inserting 
‘‘Agency’’. 
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354 
(14) HOME
MORTGAGE
DISCLOSURE
ACT
OF 
1975.—The Home Mortgage Disclosure Act of 1975 (12 
U.S.C. 2801 et seq.) is amended— 
(A) by striking ‘‘Bureau of Consumer Fi-
nancial Protection’’ each place such term ap-
pears and inserting ‘‘Consumer Law Enforce-
ment Agency’’; 
(B) by striking ‘‘Bureau’’ each place such 
term appears and inserting ‘‘Agency’’; and 
(C) in section 303, by amending paragraph 
(1) to read as follows: 
‘‘(1) the term ‘Agency’ means the Consumer Law 
Enforcement Agency;’’. 
(15) HOMEOWNERS PROTECTION ACT OF 1998.— 
Section 10(a)(4) of the Homeowners Protection Act of 
1998 (12 U.S.C. 4909(a)(4)) is amended by striking 
‘‘Bureau of Consumer Financial Protection’’ and in-
serting ‘‘Consumer Law Enforcement Agency’’. 
(16) HOME OWNERSHIP AND EQUITY PROTEC-
TION ACT OF 1994.—Section 158(a) of the Home Own-
ership and Equity Protection Act of 1994 (15 U.S.C. 
1601 note) is amended by striking ‘‘Bureau’’ and in-
serting ‘‘Consumer Law Enforcement Agency’’. 
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‘‘(9) the term ‘Agency’ means the Consumer Law 
Enforcement Agency.’’. 
(19) 
REVISED
STATUES
OF
THE
UNITED 
STATES.—Section 5136C(b)(3)(B) of the Revised Stat-
utes of the United States (12 U.S.C. 25b(b)(3)(B)) is 
amended by striking ‘‘Bureau of Consumer Financial 
Protection’’ and inserting ‘‘Consumer Law Enforce-
ment Agency’’. 
(20) RIGHT
TO
FINANCIAL
PRIVACY
ACT
OF 
1978.—The Right to Financial Privacy Act of 1978 
(12 U.S.C. 3401 et seq.) is amended— 
(A) by amending subparagraph (B) of sec-
tion 1101(7) (12 U.S.C. 3401(7)(B)) to read as 
follows: 
‘‘(B) the Consumer Law Enforcement Agen-
cy;’’; and 
(B) by striking ‘‘Bureau of Consumer Fi-
nancial Protection’’ each place such term ap-
pears in heading or text and inserting ‘‘Con-
sumer Law Enforcement Agency’’. 
(21) S.A.F.E. MORTGAGE
LICENSING
ACT
OF 
2008.—The S.A.F.E. Mortgage Licensing Act of 2008 
(12 U.S.C. 5101 et seq.) is amended— 
(A) in section 1507, by striking ‘‘Bureau, 
and the Bureau of Consumer Financial Protec-
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357 
tion’’ each place such term appears and insert-
ing ‘‘Consumer Law Enforcement Agency’’; 
(B) by striking ‘‘Bureau of Consumer Fi-
nancial Protection’’ each place such term ap-
pears and inserting ‘‘Consumer Law Enforce-
ment Agency’’; 
(C) by striking ‘‘Bureau’’ each place such 
appears, other than in sections 1505(a)(1), 
1507(a)(2)(A), 
and 
1511(b), 
and 
inserting 
‘‘Agency’’; 
(D) in section 1503, by amending para-
graph (1) to read as follows: 
‘‘(1) AGENCY.—The term ‘Agency’ means the 
Consumer Law Enforcement Agency.’’; 
(E) in the heading of section 1508, by strik-
ing ‘‘BUREAU
OF
CONSUMER
FINANCIAL 
PROTECTION’’ and inserting ‘‘CONSUMER 
LAW ENFORCEMENT AGENCY’’; and 
(F) in the heading of section 1514, by strik-
ing ‘‘BUREAU’’ and inserting ‘‘AGENCY’’. 
(22) TELEMARKETING
AND
CONSUMER
FRAUD 
AND
ABUSE
PREVENTION
ACT.—The Telemarketing 
and Consumer Fraud and Abuse Prevention Act (15 
U.S.C. 6101 et seq.) is amended by striking ‘‘Bureau 
of Consumer Financial Protection’’ each place such 
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