I
107TH CONGRESS
2D SESSION
H. R. 4038
To establish a Securities and Derivatives Oversight Commission in order
to combine the functions of the Commodity Futures Trading Commission
and the Securities and Exchange Commission in a single independent
regulatory commission, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
MARCH 20, 2002
Mr. DEFAZIO (for himself, Mr. FILNER, Ms. MCKINNEY, Mr. SANDERS, Mr.
KUCINICH, and Mr. LIPINSKI) introduced the following bill; which was re-
ferred to the Committee on Financial Services, and in addition to the
Committee on Agriculture, for a period to be subsequently determined by
the Speaker, in each case for consideration of such provisions as fall with-
in the jurisdiction of the committee concerned
A BILL
To establish a Securities and Derivatives Oversight Commis-
sion in order to combine the functions of the Commodity
Futures Trading Commission and the Securities and Ex-
change Commission in a single independent regulatory
commission, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Market Oversight Consolidation and OTC Derivatives
Regulation Act’’.
(b) TABLE OF CONTENTS.—
Sec. 1. Short title; table of contents.
Sec. 2. Purposes.
Sec. 3. Definitions.
Sec. 4. Effect on congressional jurisdiction.
TITLE I—ESTABLISHMENT OF COMMISSION
Sec. 101. Establishment.
Sec. 102. Members: appointment; terms.
Sec. 103. Organization of commission.
Sec. 104. General Counsel.
TITLE II—TRANSFERS OF FUNCTIONS
Sec. 201. Commodity Futures Trading Commission functions.
Sec. 202. Securities and Exchange Commission.
Sec. 203. Jurisdiction of margin authority.
TITLE III—FEDERAL FINANCIAL MARKETS COORDINATING
COUNCIL
Sec. 301. Establishment; membership.
Sec. 302. Functions of the Council.
Sec. 303. Staff; administrative support; expenses.
TITLE IV—ADMINISTRATIVE PROVISIONS
PART A—PERSONNEL PROVISIONS
Sec. 401. Officers and employees.
Sec. 402. Experts and consultants.
PART B—GENERAL ADMINISTRATIVE PROVISIONS
Sec. 411. General authority.
Sec. 412. Delegation.
Sec. 413. Reorganization.
Sec. 414. Rules.
Sec. 415. Contracts.
Sec. 416. Regional and field offices.
Sec. 417. Use of facilities.
Sec. 418. Working capital fund.
Sec. 419. Funds transfer.
Sec. 420. Seal of Commission.
Sec. 421. Annual report.
TITLE V—TRANSITIONAL, SAVINGS, AND CONFORMING
PROVISIONS
Sec. 501. Transfer and allocation of appropriations and personnel.
Sec. 502. Effect on personnel.
Sec. 503. Agency terminations.
Sec. 504. Incidental transfers.
Sec. 505. Savings provisions.
Sec. 506. Separability.
Sec. 507. Reference.
Sec. 508. Amendments.
Sec. 509. Transition.
TITLE VI—REGULATION OF OTC DERIVATIVES
Sec. 601. Regulation of over-the-counter derivatives.
TITLE VII—EFFECTIVE DATE
Sec. 701. Effective date.
SEC. 2. PURPOSES.
The purposes of this Act are—
(1) to establish a single Federal regulatory body
with jurisdiction over securities and derivatives, in-
cluding options, futures, swaps, and related markets
and instruments and including over-the-counter de-
rivatives;
(2) to consolidate and revise the authority for
setting margin requirements on all such instru-
ments;
(3) to coordinate the regulation of all financial
markets;
(4) to strengthen investor confidence in United
States financial markets; and
(5) to ensure the competitiveness of those mar-
kets.
SEC. 3. DEFINITIONS.
As used in this Act—
(1) the term ‘‘Commission’’ means the Securi-
ties and Derivatives Oversight Commission estab-
lished by section 101 of this Act; and
(2) the term ‘‘function’’ includes any duty, obli-
gation, power, authority, responsibility, right, privi-
lege, activity, or program.
SEC. 4. EFFECT ON CONGRESSIONAL JURISDICTION.
It is the sense of Congress that this Act shall not
be construed to affect the jurisdiction of any committee
or subcommittee of the Congress with respect to any func-
tion transferred to the Commission by this Act.
TITLE I—ESTABLISHMENT OF
COMMISSION
SEC. 101. ESTABLISHMENT.
There is established an independent regulatory com-
mission to be known as the Securities and Derivatives
Oversight Commission.
SEC. 102. MEMBERS: APPOINTMENT; TERMS.
(a) COMPOSITION OF COMMISSION.—The Commis-
sion shall be composed of five commissioners appointed by
the President, by and with the advice and consent of the
Senate. One of the commissioners shall be designated by
the President as chairman. Not more than three of such
members shall be members of the same political party.