165
er’s license, passport, or other document that contains a
photograph of the debtor and such other personal identi-
fying information relating to the debtor that establishes the
identity of the debtor.’’.
(c) Section 1324 of title 11, United States Code, is
amended—
(1) by inserting ‘‘(a)’’ before ‘‘After’’; and
(2) by inserting at the end thereof—
‘‘(c) Whenever a party in interest is given notice of
a hearing on the confirmation or modification of a plan
under this chapter, such notice shall include the informa-
tion provided by the debtor on the most recent statement
filed with the court pursuant to section 521(a)(1)(B)(ii) or
(f)(4) of this title.’’.
SEC. 604. DISMISSAL FOR FAILURE TO TIMELY FILE SCHED-
ULES OR PROVIDE REQUIRED INFORMATION.
Section 521 of title 11, United States Code, as amend-
ed by section 603 is amended by inserting after subsection
(a) the following:
‘‘(b)(1) Notwithstanding section 707(a) of this title,
and subject to paragraph (2), if an individual debtor in
a voluntary case under chapter 7 or 13 fails to file all of
the information required under subsection (a)(1) within 45
days after the filing of the petition commencing the case,
166
the case shall be automatically dismissed effective on the
46th day after the filing of the petition.
‘‘(2) With respect to a case described in paragraph (1),
any party in interest may request the court to enter an
order dismissing the case. The court shall, if so requested,
enter an order of dismissal not later than 5 days after such
request.
‘‘(3) Upon request of the debtor made within 45 days
after the filing of the petition commencing a case described
in paragraph (1), the court may allow the debtor an addi-
tional period not to exceed 45 days to file the information
required under subsection (a)(1) if the court finds justifica-
tion for extending the period for the filing.’’.
SEC. 605. ADEQUATE TIME TO PREPARE FOR HEARING ON
CONFIRMATION OF THE PLAN.
(a) HEARING.—Section 1324 of title 11, United States
Code, is amended—
(1) by striking ‘‘After’’ and inserting the fol-
lowing:
‘‘(a) Except as provided in subsection (b) and after’’;
and
(2) by adding at the end the following:
‘‘(b) The hearing on confirmation of the plan may be
held not earlier than 20 days, and not later than 45 days,
167
after the meeting of creditors under section 341(a) of this
title.’’.
SEC. 606. CHAPTER 13 PLANS TO HAVE A 5-YEAR DURATION
IN CERTAIN CASES.
Title 11, United States Code, is amended—
(1) by amending section 1322(d) to read as fol-
lows:
‘‘(d) If the current monthly income of the debtor and
the debtor’s spouse combined, when multiplied by 12, is not
less than the highest national median family income last
reported by the Bureau of the Census for a family of equal
or lesser size or, in the case of a household of 1 person, not
less than the national median household income for 1 earn-
er, the plan may not provide for payments over a period
that is longer than 5 years. If the current monthly income
of the debtor and the debtor’s spouse combined, when multi-
plied by 12, is less than the highest national median family
income for a family of equal or lesser size, or in the case
of a household of 1 person, the national median household
income for 1 earner, the plan may not provide for payments
over a period that is longer than 3 years, unless the court,
for cause, approves a longer period, but the court may not
approve a period that is longer than 5 years. Notwith-
standing the foregoing, the national median family income
for a family of more than 4 individuals shall be the na-
168
tional median family income last reported by the Bureau
of the Census for a family of 4 individuals plus $583 for
each additional member of the family.’’;
(2) in section 1325(b)(1)(B) as amended by sec-
tion 130—
(A) by striking ‘‘three year period’’ and in-
serting ‘‘applicable commitment period’’; and
(B) by inserting at the end of subparagraph
(B) the following: ‘‘The ‘applicable commitment
period’ shall be not less than 5 years if the cur-
rent monthly income of the debtor and the debt-
or’s spouse combined, when multiplied by 12, is
not less than the highest national median family
income last reported by the Bureau of the Census
for a family of equal or lesser size, or in the case
of a household of 1 person, the national median
household income for 1 earner. Notwithstanding
the foregoing, the national median family in-
come for a family of more than 4 individuals
shall be the national median family income last
reported by the Bureau of the Census for a fam-
ily of 4 individuals plus $583 for each addi-
tional member of the family.’’; and
(3) in section 1329—
169
(A) by striking in subsection (c) ‘‘three
years’’ and inserting ‘‘the applicable commit-
ment period under section 1325(b)(1)(B)’’; and
(B) by inserting at the end of subsection (c)
the following:
‘‘The duration period shall be 5 years if the current monthly
income of the debtor and the debtor’s spouse combined, when
multiplied by 12, is not less than the highest national me-
dian family income last reported by the Bureau of the Cen-
sus for a family of equal or lesser size or, in the case of
a household of 1 person, the national median household in-
come for 1 earner, as of the date of the modification and
shall be 3 years if the current monthly total income of the
debtor and the debtor’s spouse combined, when multiplied
by 12, is less than the highest national median family in-
come last reported by the Bureau of the Census for a family
of equal or lesser size or, in the case of a household of 1
person, less than the national median household income for
1 earner as of the date of the modification. Notwithstanding
the foregoing, the national median family income for a fam-
ily of more than 4 individuals shall be the national median
family income last reported by the Bureau of the Census
for a family of 4 individuals plus $583 for each additional
member of the family.’’.
170
SEC. 607. SENSE OF THE CONGRESS REGARDING EXPAN-
SION OF RULE 9011 OF THE FEDERAL RULES
OF BANKRUPTCY PROCEDURE.
It is the sense of the Congress that rule 9011 of the
Federal Rules of Bankruptcy Procedure (11 U.S.C. App)
should be modified to include a requirement that all docu-
ments (including schedules), signed and unsigned, sub-
mitted to the court or to a trustee by debtors who represent
themselves and debtors who are represented by an attorney
be submitted only after the debtor or the debtor’s attorney
has made reasonable inquiry to verify that the information
contained in such documents is well grounded in fact, and
is warranted by existing law or a good-faith argument for
the extension, modification, or reversal of existing law.
SEC. 608. ELIMINATION OF CERTAIN FEES PAYABLE IN
CHAPTER 11 BANKRUPTCY CASES.
(a) AMENDMENTS.—Section 1930(a)(6) of title 28,
United States Code, is amended—
(1) in the 1st sentence by striking ‘‘until the case
is converted or dismissed, whichever occurs first’’; and
(2) in the 2d sentence—
(A) by striking ‘‘The’’ and inserting ‘‘Until
the plan is confirmed or the case is converted
(whichever occurs first) the’’; and
(B) by striking ‘‘less than $300,000;’’ and
inserting ‘‘less than $300,000. Until the case is
172
(1) by inserting ‘‘(1)’’ after ‘‘(e)’’; and
(2) by adding at the end the following:
‘‘(2) Notwithstanding paragraph (1), in the case of an
individual filing under chapter 7, 11, or 13, the stay under
subsection (a) shall terminate on the date that is 60 days
after a request is made by a party in interest under sub-
section (d), unless—
‘‘(A) a final decision is rendered by the court
during the 60-day period beginning on the date of the
request; or
‘‘(B) that 60-day period is extended—
‘‘(i) by agreement of all parties in interest;
or
‘‘(ii) by the court for such specific period of
time as the court finds is required by for good
cause as described in findings made by the
court.’’.
SEC. 611. STOPPING ABUSIVE CONVERSIONS FROM CHAP-
TER 13.
Section 348(f)(1) of title 11, United States Code, is
amended—
(1) in subparagraph (A), by striking ‘‘and’’ at
the end;
(2) in subparagraph (B)—
173
(A) by striking ‘‘in the converted case, with
allowed secured claims’’ and inserting ‘‘only in
a case converted to chapter 11 or 12 but not in
a case converted to chapter 7, with allowed se-
cured claims in cases under chapters 11 and
12’’; and
(B) by striking the period and inserting ‘‘;
and’’; and
(3) by adding at the end the following:
‘‘(C) with respect to cases converted from chapter
13—
‘‘(i) the claim of any creditor holding secu-
rity as of the date of the petition shall continue
to be secured by that security unless the full
amount of such claim determined under applica-
ble nonbankruptcy law has been paid in full as
of the date of conversion, notwithstanding any
valuation or determination of the amount of an
allowed secured claim made for the purposes of
the chapter 13 proceeding; and
‘‘(ii) unless a prebankruptcy default has
been fully cured pursuant to the plan at the time
of conversion, in any proceeding under this title
or otherwise, the default shall have the effect
given under applicable nonbankruptcy law.’’.
174
SEC. 612. BANKRUPTCY APPEALS.
Title 28 of the United States Code is amended by in-
serting after section 1292 the following:
‘‘§ 1293. Bankruptcy appeals
‘‘(a) The courts of appeals (other than the United
States Court of Appeals for the Federal Circuit) shall have
jurisdiction of appeals from the following:
‘‘(1) Final orders and judgments entered by
bankruptcy courts and district courts in cases under
title 11, in proceedings arising under title 11, and in
proceedings arising in or related to a case under title
11, including final orders in proceedings regarding
the automatic stay of section 362 of title 11.
‘‘(2) Interlocutory orders entered by bankruptcy
courts and district courts granting, continuing, modi-
fying, refusing or dissolving injunctions, or refusing
to dissolve or modify injunctions in cases under title
11, in proceedings arising under title 11, and in pro-
ceedings arising in or related to a case under title 11,
other than interlocutory orders in proceedings regard-
ing the automatic stay of section 362 of title 11.
‘‘(3) Interlocutory orders of bankruptcy courts
and district courts entered under section 1104(a) or
1121(d) of title 11, or the refusal to enter an order
under such section.
175
‘‘(4) An interlocutory order of a bankruptcy
court or district court entered in a case under title
11, in a proceeding arising under title 11, or in a
proceeding arising in or related to a case under title
11, if the court of appeals that would have jurisdic-
tion of an appeal of a final order entered in such case
or such proceeding permits, in its discretion, appeal
to be taken from such interlocutory order.
‘‘(b) Final decisions, judgments, orders, and decrees
entered by a bankruptcy appellate panel under subsection
(b) of this section.
‘‘(c)(1) The judicial council of a circuit may establish
a bankruptcy appellate panel composed of bankruptcy
judges in the circuit who are appointed by the judicial
council, which panel shall exercise the jurisdiction to review
orders and judgments of bankruptcy courts described in
paragraphs (1)–(4) of subsection (a) of this section unless—
‘‘(A) the appellant elects at the time of filing the
appeal; or
‘‘(B) any other party elects, not later than 10
days after service of the notice of the appeal;
to have such jurisdiction exercised by the court of appeals.
‘‘(2) An appeal to be heard by a bankruptcy appellate
panel under this subsection (b) shall be heard by 3 members
of the bankruptcy appellate panel, provided that a member
176
of such panel may not hear an appeal originating in the
district for which such member is appointed or designated
under section 152 of this title.
‘‘(3) If authorized by the Judicial Conference of the
United States, the judicial councils of 2 or more circuits
may establish a joint bankruptcy appellate panel.’’.
SEC. 613. GAO STUDY.
(a) STUDY.—Not later than 270 days after the date
of the enactment of this Act, the Comptroller General of the
United States shall conduct a study of the feasibility, effec-
tiveness, and cost of requiring trustees appointed under title
11 of the United States Code, or the bankruptcy courts, to
provide to the Office of Child Support Enforcement prompt-
ly after the commencement of cases by individual debtors
under such title, the names and social security numbers of
such debtors for the purposes of allowing such Office to de-
termine whether such debtors have outstanding obligations
for child support (as determined on the basis of information
in the Federal Case Registry or other national database).
(b) REPORT.—Not later than 300 days after the date
of the enactment of this Act, the Comptroller General shall
submit to the Speaker of the House of Representatives and
the President pro tempore of the Senate, a report containing
the results of the study required by subsection (a).
177
TITLE VII—BANKRUPTCY DATA
SEC. 701. IMPROVED BANKRUPTCY STATISTICS.
(a) AMENDMENT.—Chapter 6 of part I of title 28,
United States Code, is amended by adding at the end the
following:
‘‘§ 159. Bankruptcy statistics
‘‘(a) The clerk of each district shall compile statistics
regarding individual debtors with primarily consumer
debts seeking relief under chapters 7, 11, and 13 of title
11. Those statistics shall be in a form prescribed by the Di-
rector of the Administrative Office of the United States
Courts (referred to in this section as the ‘Office’).
‘‘(b) The Director shall—
‘‘(1) compile the statistics referred to in sub-
section (a);
‘‘(2) make the statistics available to the public;
and
‘‘(3) not later than October 31, 2000, and annu-
ally thereafter, prepare, and submit to Congress a re-
port concerning the information collected under sub-
section (a) that contains an analysis of the informa-
tion.
‘‘(c) The compilation required under subsection (b)
shall—
178
‘‘(1) be itemized, by chapter, with respect to title
11;
‘‘(2) be presented in the aggregate and for each
district; and
‘‘(3) include information concerning—
‘‘(A) the total assets and total liabilities of
the debtors described in subsection (a), and in
each category of assets and liabilities, as re-
ported in the schedules prescribed pursuant to
section 2075 of this title and filed by those debt-
ors;
‘‘(B) the current monthly income, and aver-
age income and average expenses of those debtors
as reported on the schedules and statements that
each such debtor files under sections 521 and
1322 of title 11;
‘‘(C) the aggregate amount of debt dis-
charged in the reporting period, determined as
the difference between the total amount of debt
and obligations of a debtor reported on the sched-
ules and the amount of such debt reported in cat-
egories which are predominantly nondischarge-
able;
‘‘(D) the average period of time between the
filing of the petition and the closing of the case;
179
‘‘(E) for the reporting period—
‘‘(i) the number of cases in which a re-
affirmation was filed; and
‘‘(ii)(I) the total number of reaffirma-
tions filed;
‘‘(II) of those cases in which a reaffir-
mation was filed, the number in which the
debtor was not represented by an attorney;
and
‘‘(III) of those cases, the number of
cases in which the reaffirmation was ap-
proved by the court;
‘‘(F) with respect to cases filed under chap-
ter 13 of title 11, for the reporting period—
‘‘(i)(I) the number of cases in which a
final order was entered determining the
value of property securing a claim in an
amount less than the amount of the claim;
and
‘‘(II) the number of final orders deter-
mining the value of property securing a
claim issued;
‘‘(ii) the number of cases dismissed, the
number of cases dismissed for failure to
make payments under the plan, the number
180
of cases refiled after dismissal, and the
number of cases in which the plan was com-
pleted, separately itemized with respect to
the number of modifications made before
completion of the plan, if any; and
‘‘(iii) the number of cases in which the
debtor filed another case within the 6 years
previous to the filing;
‘‘(G) the number of cases in which creditors
were fined for misconduct and any amount of
punitive damages awarded by the court for cred-
itor misconduct; and
‘‘(H) the number of cases in which sanc-
tions under rule 9011 of the Federal Rules of
Bankruptcy Procedure were imposed against
debtor’s counsel and damages awarded under
such Rule.’’.
(b) CLERICAL AMENDMENT.—The table of sections at
the beginning of chapter 6 of title 28, United States Code,
is amended by adding at the end the following:
‘‘159. Bankruptcy statistics.’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall take effect 18 months after the date of enact-
ment of this Act.
181
SEC. 702. UNIFORM RULES FOR THE COLLECTION OF BANK-
RUPTCY DATA.
(a) AMENDMENT.—Title 28 of the United States Code
is amended by inserting after section 589a the following:
‘‘§ 589b. Bankruptcy data
‘‘(a) RULES.—The Attorney General shall, within a
reasonable time after the effective date of this section, issue
rules requiring uniform forms for (and from time to time
thereafter to appropriately modify and approve)—
‘‘(1) final reports by trustees in cases under
chapters 7, 12, and 13 of title 11; and
‘‘(2) periodic reports by debtors in possession or
trustees, as the case may be, in cases under chapter
11 of title 11.
‘‘(b) REPORTS.—All reports referred to in subsection
(a) shall be designed (and the requirements as to place and
manner of filing shall be established) so as to facilitate com-
pilation of data and maximum possible access of the public,
both by physical inspection at 1 or more central filing loca-
tions, and by electronic access through the Internet or other
appropriate media.
‘‘(c) REQUIRED INFORMATION.—The information re-
quired to be filed in the reports referred to in subsection
(b) shall be that which is in the best interests of debtors
and creditors, and in the public interest in reasonable and
adequate information to evaluate the efficiency and practi-
182
cality of the Federal bankruptcy system. In issuing rules
proposing the forms referred to in subsection (a), the Attor-
ney General shall strike the best achievable practical bal-
ance between—
‘‘(1) the reasonable needs of the public for infor-
mation about the operational results of the Federal
bankruptcy system; and
‘‘(2) economy, simplicity, and lack of undue bur-
den on persons with a duty to file reports.
‘‘(d) FINAL REPORTS.—Final reports proposed for
adoption by trustees under chapters 7, 12, and 13 of title
11 shall, in addition to such other matters as are required
by law or as the Attorney General in the discretion of the
Attorney General, shall propose, include with respect to a
case under such title—
‘‘(1) information about the length of time the
case was pending;
‘‘(2) assets abandoned;
‘‘(3) assets exempted;
‘‘(4) receipts and disbursements of the estate;
‘‘(5) expenses of administration;
‘‘(6) claims asserted;
‘‘(7) claims allowed; and
‘‘(8) distributions to claimants and claims dis-
charged without payment,
183
in each case by appropriate category and, in cases under
chapters 12 and 13 of title 11, date of confirmation of the
plan, each modification thereto, and defaults by the debtor
in performance under the plan.
‘‘(e) PERIODIC REPORTS.—Periodic reports proposed
for adoption by trustees or debtors in possession under
chapter 11 of title 11 shall, in addition to such other mat-
ters as are required by law or as the Attorney General, in
the discretion of the Attorney General, shall propose,
include—
‘‘(1) information about the standard industry
classification, published by the Department of Com-
merce, for the businesses conducted by the debtor;
‘‘(2) length of time the case has been pending;
‘‘(3) number of full-time employees as at the date
of the order for relief and at end of each reporting pe-
riod since the case was filed;
‘‘(4) cash receipts, cash disbursements and prof-
itability of the debtor for the most recent period and
cumulatively since the date of the order for relief;
‘‘(5) compliance with title 11, whether or not tax
returns and tax payments since the date of the order
for relief have been timely filed and made;
‘‘(6) all professional fees approved by the court
in the case for the most recent period and cumula-
184
tively since the date of the order for relief (separately
reported, in for the professional fees incurred by or on
behalf of the debtor, between those that would have
been incurred absent a bankruptcy case and those
not); and
‘‘(7) plans of reorganization filed and confirmed
and, with respect thereto, by class, the recoveries of
the holders, expressed in aggregate dollar values and,
in the case of claims, as a percentage of total claims
of the class allowed.’’.
(b) TECHNICAL AMENDMENT.—The table of sections of
chapter 39 of title 28, United States Code, is amended by
adding at the end the following:
‘‘589b. Bankruptcy data.’’.
SEC. 703. SENSE OF THE CONGRESS REGARDING AVAIL-
ABILITY OF BANKRUPTCY DATA.
It is the sense of the Congress that—
(1) the national policy of the United States
should be that all data held by bankruptcy clerks in
electronic form, to the extent such data reflects only
public records (as defined in section 107 of title 11
of the United States Code), should be released in a us-
able electronic form in bulk to the public subject to
such appropriate privacy concerns and safeguards as
the Judicial Conference of the United States may de-
termine; and
185
(2) there should be established a bankruptcy data
system in which—
(A) a single set of data definitions and
forms are used to collect data nationwide; and
(B) data for any particular bankruptcy
case are aggregated in the same electronic record.
TITLE VIII—BANKRUPTCY TAX
PROVISIONS
SEC. 801. TREATMENT OF CERTAIN LIENS.
(a) TREATMENT OF CERTAIN LIENS.—Section 724 of
title 11, United States Code, is amended—
(1) in subsection (b), in the matter preceding
paragraph (1), by inserting ‘‘(other than to the extent
that there is a properly perfected unavoidable tax lien
arising in connection with an ad valorem tax on real
or personal property of the estate)’’ after ‘‘under this
title’’;
(2) in subsection (b)(2), after ‘‘507(a)(1)’’, insert
‘‘(except that such expenses, other than claims for
wages, salaries, or commissions which arise after the
filing of a petition, shall be limited to expenses in-
curred under chapter 7 of this title and shall not in-
clude expenses incurred under chapter 11 of this
title)’’; and
(3) by adding at the end the following:
186
‘‘(e) Before subordinating a tax lien on real or per-
sonal property of the estate, the trustee shall—
‘‘(1) exhaust the unencumbered assets of the es-
tate; and
‘‘(2) in a manner consistent with section 506(c)
of this title, recover from property securing an al-
lowed secured claim the reasonable, necessary costs
and expenses of preserving or disposing of that prop-
erty.
‘‘(f) Notwithstanding the exclusion of ad valorem tax
liens set forth in this section and subject to the requirements
of subsection (e)—
‘‘(1) claims for wages, salaries, and commissions
that are entitled to priority under section 507(a)(3)
of this title; or
‘‘(2) claims for contributions to an employee ben-
efit plan entitled to priority under section 507(a)(4)
of this title,
may be paid from property of the estate which secures a
tax lien, or the proceeds of such property.’’.
(b) DETERMINATION
OF
TAX
LIABILITY.—Section
505(a)(2) of title 11, United States Code, is amended—
(1) in subparagraph (A), by striking ‘‘or’’ at the
end;
187
(2) in subparagraph (B), by striking the period
at the end and inserting ‘‘; or’’; and
(3) by adding at the end the following:
‘‘(C) the amount or legality of any amount aris-
ing in connection with an ad valorem tax on real or
personal property of the estate, if the applicable pe-
riod for contesting or redetermining that amount
under any law (other than a bankruptcy law) has
expired.’’.
SEC. 802. EFFECTIVE NOTICE TO GOVERNMENT.
(a) EFFECTIVE NOTICE TO GOVERNMENTAL UNITS.—
Section 342 of title 11, United States Code, as amended
by section 603, is amended by adding at the end the fol-
lowing:
‘‘(g) If a debtor lists a governmental unit as a creditor
in a list or schedule, any notice required to be given by
the debtor under this title, any rule, any applicable law,
or any order of the court, shall identify the department,
agency, or instrumentality through which the debtor is in-
debted. The debtor shall identify (with information such as
a taxpayer identification number, loan, account or contract
number, or real estate parcel number, where applicable),
and describe the underlying basis for the governmental
unit’s claim. If the debtor’s liability to a governmental unit
arises from a debt or obligation owed or incurred by another
188
individual, entity, or organization, or under a different
name, the debtor shall identify such individual, entity, or-
ganization, or name.
‘‘(h) The clerk shall keep and update quarterly, in the
form and manner as the Director of the Administrative Of-
fice of the United States Courts prescribes, and make avail-
able to debtors, a register in which a governmental unit
may designate a safe harbor mailing address for service of
notice in cases pending in the district. A governmental unit
may file a statement with the clerk designating a safe har-
bor address to which notices are to be sent, unless such gov-
ernmental unit files a notice of change of address.’’.
(b) ADOPTION OF RULES PROVIDING NOTICE.—The
Advisory Committee on Bankruptcy Rules of the Judicial
Conference shall, within a reasonable period of time after
the date of the enactment of this Act, propose for adoption
enhanced rules for providing notice to State, Federal, and
local government units that have regulatory authority over
the debtor or which may be creditors in the debtor’s case.
Such rules shall be reasonably calculated to ensure that no-
tice will reach the representatives of the governmental unit,
or subdivision thereof, who will be the proper persons au-
thorized to act upon the notice. At a minimum, the rules
should require that the debtor—
189
(1) identify in the schedules and the notice, the
subdivision, agency, or entity in respect of which such
notice should be received;
(2) provide sufficient information (such as case
captions, permit numbers, taxpayer identification
numbers, or similar identifying information) to per-
mit the governmental unit or subdivision thereof, en-
titled to receive such notice, to identify the debtor or
the person or entity on behalf of which the debtor is
providing notice where the debtor may be a successor
in interest or may not be the same as the person or
entity which incurred the debt or obligation; and
(3) identify, in appropriate schedules, served to-
gether with the notice, the property in respect of
which the claim or regulatory obligation may have
arisen, if any, the nature of such claim or regulatory
obligation and the purpose for which notice is being
given.
(c) EFFECT OF FAILURE OF NOTICE.—Section 342 of
title 11, United States Code, as amended by section 603
and subsection (a), is amended by adding at the end the
following:
‘‘(i) A notice that does not comply with subsections (d)
and (e) shall not be effective unless the debtor demonstrates,
by clear and convincing evidence, that timely notice was
190
given in a manner reasonably calculated to satisfy the re-
quirements of this section was given, and that—
‘‘(1) either the notice was timely sent to the safe
harbor address provided in the register maintained by
the clerk of the district in which the case was pending
for such purposes; or
‘‘(2) no safe harbor address was provided in such
list for the governmental unit and that an officer of
the governmental unit who is responsible for the mat-
ter or claim had actual knowledge of the case in suffi-
cient time to act.’’.
SEC. 803. NOTICE OF REQUEST FOR A DETERMINATION OF
TAXES.
Section 505(b) of title 11, United States Code, is
amended by striking ‘‘Unless’’ at the beginning of the second
sentence thereof and inserting ‘‘If the request is made sub-
stantially in the manner designated by the governmental
unit and unless’’.
SEC. 804. RATE OF INTEREST ON TAX CLAIMS.
(a) AMENDMENT.—Chapter 5 of title 11, United States
Code, is amended by adding at the end the following:
‘‘§ 511. Rate of interest on tax claims
‘‘If any provision of this title requires the payment
of interest on a tax claim or requires the payment of inter-
est to enable a creditor to receive the present value of the
191
allowed amount of a tax claim, the rate of interest shall
be as follows:
‘‘(1) In the case of ad valorem tax claims, wheth-
er secured or unsecured, other unsecured tax claims
where interest is required to be paid under section
726(a)(5) of this title, secured tax claims, and admin-
istrative tax claims paid under section 503(b)(1) of
this title, the rate shall be determined under applica-
ble nonbankruptcy law.
‘‘(2) In the case of all other tax claims, the min-
imum rate of interest shall be the Federal short-term
rate rounded to the nearest full percent, determined
under section 1274(d) of the Internal Revenue Code of
1986, plus 3 percentage points.
‘‘(A) In the case of claims for Federal in-
come taxes, such rate shall be subject to any ad-
justment that may be required under section
6621(d) of the Internal Revenue Code of 1986.
‘‘(B) In the case of taxes paid under a con-
firmed plan or reorganization, such rate shall be
determined as of the calendar month in which
the plan is confirmed.’’.
(b) CONFORMING AMENDMENT.—The table of sections
of chapter 5 of title 11, United States Code, is amended
192
by inserting after the item relating to section 510 the fol-
lowing:
‘‘511. Rate of interest on tax claims.’’.
SEC. 805. TOLLING OF PRIORITY OF TAX CLAIM TIME PERI-
ODS.
Section 507(a)(8)(A) of title 11, United States Code,
as so redesignated, is amended—
(1) in clause (i) by inserting after ‘‘petition’’
and before the semicolon ‘‘, plus any time, plus 6
months, during which the stay of proceedings was in
effect in a prior case under this title’’; and
(2) amend clause (ii) to read as follows:
‘‘(ii) assessed within 240 days before
the date of the filing of the petition, exclu-
sive of—
‘‘(I) any time plus 30 days dur-
ing which an offer in compromise with
respect of such tax, was pending or in
effect during such 240-day period;
‘‘(II) any time plus 30 days dur-
ing which an installment agreement
with respect of such tax was pending
or in effect during such 240-day pe-
riod, up to 1 year; and
193
‘‘(III) any time plus 6 months
during which a stay of proceedings
against collections was in effect in a
prior case under this title during such
240-day period.’’.
SEC. 806. PRIORITY PROPERTY TAXES INCURRED.
Section 507(a)(8)(B) of title 11, United States Code,
is amended by striking ‘‘assessed’’ and inserting ‘‘in-
curred’’.
SEC. 807. CHAPTER 13 DISCHARGE OF FRAUDULENT AND
OTHER TAXES.
Section 1328(a)(2) of title 11, United States Code, is
amended by inserting ‘‘(1),’’ after ‘‘paragraph’’.
SEC. 808. CHAPTER 11 DISCHARGE OF FRAUDULENT TAXES.
Section 1141(d) of title 11, United States Code, is
amended by adding at the end the following:
‘‘(6) Notwithstanding the provisions of paragraph (1),
the confirmation of a plan does not discharge a debtor
which is a corporation from any debt for a tax or customs
duty with respect to which the debtor made a fraudulent
return or willfully attempted in any manner to evade or
defeat such tax.’’.
SEC. 809. STAY OF TAX PROCEEDINGS.
(a) SECTION 362 STAY LIMITED
TO PREPETITION
TAXES.—Section 362(a)(8) of title 11, United States Code,
194
is amended by striking the period at the end and inserting
‘‘, in respect of a tax liability for a taxable period ending
before the order for relief.’’.
(b) APPEAL OF TAX COURT DECISIONS PERMITTED.—
Section 362(b)(9) of title 11, United States Code, is
amended—
(1) in subparagraph (C) by striking ‘‘or’’ at the
end;
(2) in subparagraph (D) by striking the period
at the end and inserting ‘‘; or’’; and
(3) by adding at the end the following:
‘‘(E) the appeal of a decision by a court or
administrative tribunal which determines a tax
liability of the debtor without regard to whether
such determination was made prepetition or
postpetition.’’.
SEC. 810. PERIODIC PAYMENT OF TAXES IN CHAPTER 11
CASES.
Section 1129(a)(9) of title 11, United States Code, is
amended—
(1) in subparagraph (B) by striking ‘‘and’’ at
the end; and
(2) in subparagraph (C)—
(A) by striking ‘‘deferred cash payments,
over a period not exceeding six years after the
195
date of assessment of such claim,’’ and inserting
‘‘regular installment payments in cash, but in
no case with a balloon provision, and no more
than three months apart, beginning no later
than the effective date of the plan and ending on
the earlier of five years after the petition date or
the last date payments are to be made under the
plan to unsecured creditors,’’;
(B) by striking the period at the end and
inserting ‘‘; and’’; and
(3) by adding at the end the following:
‘‘(D) with respect to a secured claim which
would be described in section 507(a)(8) of this
title but for its secured status, the holder of such
claim will receive on account of such claim cash
payments of not less than is required in sub-
paragraph (C) and over a period no greater than
is required in such subparagraph.’’.
SEC. 811. AVOIDANCE OF STATUTORY TAX LIENS PROHIB-
ITED.
Section 545(2) of title 11, United States Code, is
amended by striking the semicolon at the end and inserting
‘‘, except where such purchaser is a purchaser described in
section 6323 of the Internal Revenue Code of 1986 or simi-
lar provision of State or local law;’’.
196
SEC. 812. PAYMENT OF TAXES IN THE CONDUCT OF BUSI-
NESS.
(a) PAYMENT OF TAXES REQUIRED.—Section 960 of
title 28, United States Code, is amended—
(1) by inserting ‘‘(a)’’ before ‘‘Any’’; and
(2) by adding at the end the following:
‘‘(b) Such taxes shall be paid when due in the conduct
of such business unless—
‘‘(1) the tax is a property tax secured by a lien
against property that is abandoned within a reason-
able time after the lien attaches, by the trustee of a
bankruptcy estate, pursuant to section 554 of title 11;
or
‘‘(2) payment of the tax is excused under a spe-
cific provision of title 11.
‘‘(c) In a case pending under chapter 7 of title 11,
payment of a tax may be deferred until final distribution
is made under section 726 of title 11 if—
‘‘(1) the tax was not incurred by a trustee duly
appointed under chapter 7 of title 11; or
‘‘(2) before the due date of the tax, the court has
made a finding of probable insufficiency of funds of
the estate to pay in full the administrative expenses
allowed under section 503(b) of title 11 that have the
same priority in distribution under section 726(b) of
title 11 as such tax.’’.
197
(b) PAYMENT OF AD VALOREM TAXES REQUIRED.—
Section 503(b)(1)(B) of title 11, United States Code, is
amended in clause (i) by inserting after ‘‘estate,’’ and before
‘‘except’’ the following: ‘‘whether secured or unsecured, in-
cluding property taxes for which liability is in rem only,
in personam or both,’’.
(c) REQUEST FOR PAYMENT OF ADMINISTRATIVE EX-
PENSE TAXES ELIMINATED.—Section 503(b)(1) of title 11,
United States Code, is amended by adding at the end the
following:
‘‘(D) notwithstanding the requirements of sub-
section (a) of this section, a governmental unit shall
not be required to file a request for the payment of
a claim described in subparagraph (B) or (C);’’.
(d) PAYMENT
OF TAXES
AND FEES
AS SECURED
CLAIMS.—Section 506 of title 11, United States Code, is
amended—
(1) in subsection (b) by inserting ‘‘or State stat-
ute’’ after ‘‘agreement’’; and
(2) in subsection (c) by inserting ‘‘, including
the payment of all ad valorem property taxes in re-
spect of the property’’ before the period at the end.
SEC. 813. TARDILY FILED PRIORITY TAX CLAIMS.
Section 726(a)(1) of title 11, United States Code, is
amended by striking ‘‘before the date on which the trustee
198
commences distribution under this section’’ and inserting
‘‘on or before the earlier of 10 days after the mailing to
creditors of the summary of the trustee’s final report or the
date on which the trustee commences final distribution
under this section’’.
SEC. 814. INCOME TAX RETURNS PREPARED BY TAX AU-
THORITIES.
Section 523(a)(1)(B) of title 11, United States Code,
is amended—
(1) by inserting ‘‘or equivalent report or notice,’’
after ‘‘a return,’’;
(2) in clause (i)—
(A) by inserting ‘‘or given’’ after ‘‘filed’’;
and
(B) by striking ‘‘or’’ at the end;
(3) in clause (ii)—
(A) by inserting ‘‘or given’’ after ‘‘filed’’;
and
(B) by inserting ‘‘, report, or notice’’ after
‘‘return’’; and
(4) by adding at the end the following:
‘‘(iii) for purposes of this subsection, a
return—
‘‘(I) must satisfy the requirements
of applicable nonbankruptcy law, and
199
includes a return prepared pursuant to
section 6020(a) of the Internal Revenue
Code of 1986, or similar State or local
law, or a written stipulation to a judg-
ment entered by a nonbankruptcy tri-
bunal, but does not include a return
made pursuant to section 6020(b) of
the Internal Revenue Code of 1986, or
similar State or local law; and
‘‘(II) must have been filed in a
manner permitted by applicable non-
bankruptcy law; or’’.
SEC. 815. DISCHARGE OF THE ESTATE’S LIABILITY FOR UN-
PAID TAXES.
Section 505(b) of title 11, United States Code, is
amended in the second sentence by inserting ‘‘the estate,’’
after ‘‘misrepresentation,’’.
SEC. 816. REQUIREMENT TO FILE TAX RETURNS TO CON-
FIRM CHAPTER 13 PLANS.
(a) FILING OF PREPETITION TAX RETURNS REQUIRED
FOR PLAN CONFIRMATION.—Section 1325(a) of title 11,
United States Code, as amended by section 140, is
amended—
(1) in paragraph (6) by striking ‘‘and’’ at the
end;
200
(2) in paragraph (7) by striking the period at
the end and inserting ‘‘; and’’; and
(3) by adding at the end the following:
‘‘(8) if the debtor has filed all Federal, State,
and local tax returns as required by section 1308 of
this title.’’.
(b) ADDITIONAL TIME PERMITTED FOR FILING TAX
RETURNS.—(1) Chapter 13 of title 11, United States Code,
as amended by section 135, is amended by adding at the
end the following:
‘‘§ 1308. Filing of prepetition tax returns
‘‘(a) On or before the day prior to the day on which
the first meeting of the creditors is convened under section
341(a) of this title, the debtor shall have filed with appro-
priate tax authorities all tax returns for all taxable periods
ending in the 3-year period ending on the date of filing
of the petition.
‘‘(b) If the tax returns required by subsection (a) have
not been filed by the date on which the first meeting of
creditors is convened under section 341(a) of this title, the
trustee may continue such meeting for a reasonable period
of time, to allow the debtor additional time to file any
unfiled returns, but such additional time shall be no more
than—
202
(b) of the Internal Revenue Code of 1986 or similar State
or local law, or a written stipulation to a judgment entered
by a nonbankruptcy tribunal.’’.
(2) The table of sections of chapter 13 of title 11,
United States Code, is amended by inserting after the item
relating to section 1307 the following:
‘‘1308. Filing of prepetition tax returns.’’.
(c) DISMISSAL OR CONVERSION ON FAILURE TO COM-
PLY.—Section 1307 of title 11, United States Code, is
amended—
(1) by redesignating subsections (e) and (f) as
subsections (f) and (g), respectively; and
(2) by inserting after subsection (d) the fol-
lowing:
‘‘(e) Upon the failure of the debtor to file tax returns
under section 1308 of this title, on request of a party in
interest or the United States trustee and after notice and
a hearing, the court shall dismiss a case or convert a case
under this chapter to a case under chapter 7 of this title,
whichever is in the best interests of creditors and the es-
tate.’’.
(d) TIMELY FILED CLAIMS.—Section 502(b)(9) of title
11, United States Code, is amended by striking the period
at the end and inserting ‘‘, and except that in a case under
chapter 13 of this title, a claim of a governmental unit for
a tax in respect of a return filed under section 1308 of this
203
title shall be timely if it is filed on or before 60 days after
such return or returns were filed as required.’’.
(e) RULES FOR OBJECTIONS TO CLAIMS AND TO CON-
FIRMATION.—It is the sense of the Congress that the Advi-
sory Committee on Bankruptcy Rules of the Judicial Con-
ference should, within a reasonable period of time after the
date of the enactment of this Act, propose for adoption
amended Federal Rules of Bankruptcy Procedure which
provide that—
(1) notwithstanding the provisions of Rule
3015(f), in cases under chapter 13 of title 11, United
States Code, a governmental unit may object to the
confirmation of a plan on or before 60 days after the
debtor files all tax returns required under sections
1308 and 1325(a)(7) of title 11, United States Code;
and
(2) in addition to the provisions of Rule 3007,
in a case under chapter 13 of title 11, United States
Code, no objection to a tax in respect of a return re-
quired to be filed under such section 1308 shall be
filed until such return has been filed as required.
SEC. 817. STANDARDS FOR TAX DISCLOSURE.
Section 1125(a) of title 11, United States Code, is
amended in paragraph (1)—
204
(1) by inserting after ‘‘records,’’ the following:
‘‘including a full discussion of the potential material
Federal, State, and local tax consequences of the plan
to the debtor, any successor to the debtor, and a hypo-
thetical investor domiciled in the State in which the
debtor resides or has its principal place of business
typical of the holders of claims or interests in the
case,’’;
(2) by inserting ‘‘such’’ after ‘‘enable’’; and
(3) by striking ‘‘reasonable’’ where it appears
after ‘‘hypothetical’’ and by striking ‘‘typical of hold-
ers of claims or interests’’ after ‘‘investor’’.
SEC. 818. SETOFF OF TAX REFUNDS.
Section 362(b) of title 11, United States Code, as
amended by sections 118, 132, 136, and 203, is amended—
(1) in paragraph (29) by striking ‘‘or’’;
(2) in paragraph (30) by striking the period at
the end and inserting ‘‘; or’’; and
(3) by inserting after paragraph (30) the fol-
lowing:
‘‘(31) under subsection (a) of the setoff of an in-
come tax refund, by a governmental unit, in respect
of a taxable period which ended before the order for
relief against an income tax liability for a taxable pe-
205
riod which also ended before the order for relief,
unless—
‘‘(A) prior to such setoff, an action to deter-
mine the amount or legality of such tax liability
under section 505(a) was commenced; or
‘‘(B) where the setoff of an income tax re-
fund is not permitted because of a pending ac-
tion to determine the amount or legality of a tax
liability, the governmental unit may hold the re-
fund pending the resolution of the action.’’.
TITLE IX—ANCILLARY AND
OTHER CROSS-BORDER CASES
SEC. 901. AMENDMENT TO ADD CHAPTER 15 TO TITLE 11,
UNITED STATES CODE.
(a) IN GENERAL.—Title 11, United States Code, is
amended by inserting after chapter 13 the following:
‘‘CHAPTER 15—ANCILLARY AND OTHER
CROSS-BORDER CASES
‘‘Sec.
‘‘1501. Purpose and scope of application.
‘‘SUBCHAPTER I—GENERAL PROVISIONS
‘‘1502. Definitions.
‘‘1503. International obligations of the United States.
‘‘1504. Commencement of ancillary case.
‘‘1505. Authorization to act in a foreign country.
‘‘1506. Public policy exception.
‘‘1507. Additional assistance.
‘‘1508. Interpretation.
‘‘SUBCHAPTER II—ACCESS OF FOREIGN REPRESENTATIVES AND
CREDITORS TO THE COURT
‘‘1509. Right of direct access.
206
‘‘1510. Limited jurisdiction.
‘‘1511. Commencement of case under section 301 or 303.
‘‘1512. Participation of a foreign representative in a case under this title.
‘‘1513. Access of foreign creditors to a case under this title.
‘‘1514. Notification to foreign creditors concerning a case under this title.
‘‘SUBCHAPTER III—RECOGNITION OF A FOREIGN PROCEEDING AND
RELIEF
‘‘1515. Application for recognition of a foreign proceeding.
‘‘1516. Presumptions concerning recognition.
‘‘1517. Order recognizing a foreign proceeding.
‘‘1518. Subsequent information.
‘‘1519. Relief that may be granted upon petition for recognition of a foreign pro-
ceeding.
‘‘1520. Effects of recognition of a foreign main proceeding.
‘‘1521. Relief that may be granted upon recognition of a foreign proceeding.
‘‘1522. Protection of creditors and other interested persons.
‘‘1523. Actions to avoid acts detrimental to creditors.
‘‘1524. Intervention by a foreign representative.
‘‘SUBCHAPTER IV—COOPERATION WITH FOREIGN COURTS AND
FOREIGN REPRESENTATIVES
‘‘1525. Cooperation and direct communication between the court and foreign
courts or foreign representatives.
‘‘1526. Cooperation and direct communication between the trustee and foreign
courts or foreign representatives.
‘‘1527. Forms of cooperation.
‘‘SUBCHAPTER V—CONCURRENT PROCEEDINGS
‘‘1528. Commencement of a case under this title after recognition of a foreign
main proceeding.
‘‘1529. Coordination of a case under this title and a foreign proceeding.
‘‘1530. Coordination of more than 1 foreign proceeding.
‘‘1531. Presumption of insolvency based on recognition of a foreign main pro-
ceeding.
‘‘1532. Rule of payment in concurrent proceedings.
‘‘§ 1501. Purpose and scope of application
‘‘(a) The purpose of this chapter is to incorporate the
Model Law on Cross-Border Insolvency so as to provide ef-
fective mechanisms for dealing with cases of cross-border in-
solvency with the objectives of—
‘‘(1) cooperation between—
207
‘‘(A) United States courts, United States
trustees, trustees, examiners, debtors, and debtors
in possession; and
‘‘(B) the courts and other competent au-
thorities of foreign countries involved in cross-
border insolvency cases;
‘‘(2) greater legal certainty for trade and invest-
ment;
‘‘(3) fair and efficient administration of cross-
border insolvencies that protects the interests of all
creditors, and other interested entities, including the
debtor;
‘‘(4) protection and maximization of the value of
the debtor’s assets; and
‘‘(5) facilitation of the rescue of financially trou-
bled businesses, thereby protecting investment and
preserving employment.
‘‘(b) This chapter applies where—
‘‘(1) assistance is sought in the United States by
a foreign court or a foreign representative in connec-
tion with a foreign proceeding;
‘‘(2) assistance is sought in a foreign country in
connection with a case under this title;
208
‘‘(3) a foreign proceeding and a case under this
title with respect to the same debtor are taking place
concurrently; or
‘‘(4) creditors or other interested persons in a
foreign country have an interest in requesting the
commencement of, or participating in, a case or pro-
ceeding under this title.
‘‘(c) This chapter does not apply to—
‘‘(1) a proceeding concerning an entity identified
by exclusion in subsection 109(b);
‘‘(2) an individual, or to an individual and such
individual’s spouse, who have debts within the limits
specified in section 109(e) and who are citizens of the
United States or aliens lawfully admitted for perma-
nent residence in the United States; or
‘‘(3) an entity subject to a proceeding under the
Securities Investor Protection Act, a stockbroker sub-
ject to subchapter III of chapter 7 of this title, or a
commodity broker subject to subchapter IV of chapter
7 of this title.
‘‘SUBCHAPTER I—GENERAL PROVISIONS
‘‘§ 1502. Definitions
‘‘For the purposes of this chapter, the term—
‘‘(1) ‘debtor’ means an entity that is the subject
of a foreign proceeding;
209
‘‘(2) ‘establishment’ means any place of oper-
ations where the debtor carries out a nontransitory
economic activity;
‘‘(3) ‘foreign court’ means a judicial or other au-
thority competent to control or supervise a foreign
proceeding;
‘‘(4) ‘foreign main proceeding’ means a foreign
proceeding taking place in the country where the debt-
or has the center of its main interests;
‘‘(5) ‘foreign nonmain proceeding’ means a for-
eign proceeding, other than a foreign main pro-
ceeding, taking place in a country where the debtor
has an establishment;
‘‘(6) ‘trustee’ includes a trustee, a debtor in pos-
session in a case under any chapter of this title, or
a debtor under chapter 9 of this title; and
‘‘(7) ‘within the territorial jurisdiction of the
United States’ when used with reference to property
of a debtor refers to tangible property located within
the territory of the United States and intangible
property deemed under applicable nonbankruptcy law
to be located within that territory, including any
property subject to attachment or garnishment that
may properly be seized or garnished by an action in
a Federal or State court in the United States.
210
‘‘§ 1503. International obligations of the United States
‘‘To the extent that this chapter conflicts with an obli-
gation of the United States arising out of any treaty or
other form of agreement to which it is a party with 1 or
more other countries, the requirements of the treaty or
agreement prevail.
‘‘§ 1504. Commencement of ancillary case
‘‘A case under this chapter is commenced by the filing
of a petition for recognition of a foreign proceeding under
section 1515.
‘‘§ 1505. Authorization to act in a foreign country
‘‘A trustee or another entity (including an examiner)
may be authorized by the court to act in a foreign country
on behalf of an estate created under section 541. An entity
authorized to act under this section may act in any way
permitted by the applicable foreign law.
‘‘§ 1506. Public policy exception
‘‘Nothing in this chapter prevents the court from refus-
ing to take an action governed by this chapter if the action
would be manifestly contrary to the public policy of the
United States.
‘‘§ 1507. Additional assistance
‘‘(a) Subject to the specific limitations stated elsewhere
in this chapter the court, upon recognition of a foreign pro-
ceeding, the court may provide additional assistance to a
211
foreign representative under this title or under other laws
of the United States.
‘‘(b) In determining whether to provide additional as-
sistance under this title or under other laws of the United
States, the court shall consider whether such additional as-
sistance, consistent with the principles of comity, will rea-
sonably assure—
‘‘(1) just treatment of all holders of claims
against or interests in the debtor’s property;
‘‘(2) protection of claim holders in the United
States against prejudice and inconvenience in the
processing of claims in such foreign proceeding;
‘‘(3) prevention of preferential or fraudulent dis-
positions of property of the debtor;
‘‘(4) distribution of proceeds of the debtor’s prop-
erty substantially in accordance with the order pre-
scribed by this title; and
‘‘(5) if appropriate, the provision of an oppor-
tunity for a fresh start for the individual that such
foreign proceeding concerns.
‘‘§ 1508. Interpretation
‘‘In interpreting this chapter, the court shall consider
its international origin, and the need to promote an appli-
cation of this chapter that is consistent with the application
of similar statutes adopted by foreign jurisdictions.
212
‘‘SUBCHAPTER II—ACCESS OF FOREIGN REP-
RESENTATIVES AND CREDITORS TO THE
COURT
‘‘§ 1509. Right of direct access
‘‘(a) A foreign representative may commence a case
under section 1504 of this title by filing with the court a
petition for recognition of a foreign proceeding under sec-
tion 1515 of this title.
‘‘(b) If the court grants recognition under section 1515
of this title, and subject to any limitations that the court
may impose consistent with the policy of this chapter—
‘‘(1) the foreign representative has the capacity
to sue and be sued in a court in the United States;
‘‘(2) the foreign representative may apply di-
rectly to a court in the United States for appropriate
relief in that court; and
‘‘(3) a court in the United States shall grant
comity or cooperation to the foreign representative.
‘‘(c) A request for comity or cooperation by a foreign
representative in a court in the United States shall be ac-
companied by a certified copy of an order granting recogni-
tion under section 1517 of this title.
‘‘(d) If the court denies recognition under this chapter,
the court may issue any appropriate order necessary to pre-
213
vent the foreign representative from obtaining comity or co-
operation from courts in the United States.
‘‘(e) Whether or not the court grants recognition, and
subject to sections 306 and 1510 of this title, a foreign rep-
resentative is subject to applicable nonbankruptcy law.
‘‘(f) Notwithstanding any other provision of this sec-
tion, the failure of a foreign representative to commence a
case or to obtain recognition under this chapter does not
affect any right the foreign representative may have to sue
in a court in the United State to collect or recover a claim
which is the property of the debtor.’’.
‘‘§ 1510. Limited jurisdiction
‘‘The sole fact that a foreign representative files a peti-
tion under section 1515 does not subject the foreign rep-
resentative to the jurisdiction of any court in the United
States for any other purpose.
‘‘§ 1511. Commencement of case under section 301 or
303
‘‘(a) Upon recognition, a foreign representative may
commence—
‘‘(1) an involuntary case under section 303; or
‘‘(2) a voluntary case under section 301 or 302,
if the foreign proceeding is a foreign main proceeding.
‘‘(b) The petition commencing a case under subsection
(a) must be accompanied by certified copy of an order
214
granting recognition. The court where the petition for rec-
ognition has been filed must be advised of the foreign rep-
resentative’s intent to commence a case under subsection (a)
prior to such commencement.
‘‘§ 1512. Participation of a foreign representative in a
case under this title
‘‘Upon recognition of a foreign proceeding, the foreign
representative in that proceeding is entitled to participate
as a party in interest in a case regarding the debtor under
this title.
‘‘§ 1513. Access of foreign creditors to a case under
this title
‘‘(a) Foreign creditors have the same rights regarding
the commencement of, and participation in, a case under
this title as domestic creditors.
‘‘(b)(1) Subsection (a) does not change or codify
present law as to the priority of claims under section 507
or 726 of this title, except that the claim of a foreign cred-
itor under those sections shall not be given a lower priority
than that of general unsecured claims without priority sole-
ly because the holder of such claim is a foreign creditor.
‘‘(2)(A) Subsection (a) and paragraph (1) do not
change or codify present law as to the allowability of foreign
revenue claims or other foreign public law claims in a pro-
ceeding under this title.
215
‘‘(B) Allowance and priority as to a foreign tax claim
or other foreign public law claim shall be governed by any
applicable tax treaty of the United States, under the condi-
tions and circumstances specified therein.
‘‘§ 1514. Notification to foreign creditors concerning a
case under this title
‘‘(a) Whenever in a case under this title notice is to
be given to creditors generally or to any class or category
of creditors, such notice shall also be given to the known
creditors generally, or to creditors in the notified class or
category, that do not have addresses in the United States.
The court may order that appropriate steps be taken with
a view to notifying any creditor whose address is not yet
known.
‘‘(b) Such notification to creditors with foreign ad-
dresses described in subsection (a) shall be given individ-
ually, unless the court considers that, under the cir-
cumstances, some other form of notification would be more
appropriate. No letters rogatory or other similar formality
is required.
‘‘(c) When a notification of commencement of a case
is to be given to foreign creditors, the notification shall—
‘‘(1) indicate the time period for filing proofs of
claim and specify the place for their filing;
216
‘‘(2) indicate whether secured creditors need to
file their proofs of claim; and
‘‘(3) contain any other information required to
be included in such a notification to creditors under
this title and the orders of the court.
‘‘(d) Any rule of procedure or order of the court as
to notice or the filing of a claim shall provide such addi-
tional time to creditors with foreign addresses as is reason-
able under the circumstances.
‘‘SUBCHAPTER III—RECOGNITION OF A FOREIGN
PROCEEDING AND RELIEF
‘‘§ 1515. Application for recognition of a foreign pro-
ceeding
‘‘(a) A foreign representative applies to the court for
recognition of the foreign proceeding in which the foreign
representative has been appointed by filing a petition for
recognition.
‘‘(b) A petition for recognition shall be accompanied
by—
‘‘(1) a certified copy of the decision commencing
the foreign proceeding and appointing the foreign
representative;
‘‘(2) a certificate from the foreign court affirm-
ing the existence of the foreign proceeding and of the
appointment of the foreign representative; or
217
‘‘(3) in the absence of evidence referred to in
paragraphs (1) and (2), any other evidence acceptable
to the court of the existence of the foreign proceeding
and of the appointment of the foreign representative.
‘‘(c) A petition for recognition shall also be accom-
panied by a statement identifying all foreign proceedings
with respect to the debtor that are known to the foreign rep-
resentative.
‘‘(d) The documents referred to in paragraphs (1) and
(2) of subsection (b) must be translated into English. The
court may require a translation into English of additional
documents.
‘‘§ 1516. Presumptions concerning recognition
‘‘(a) If the decision or certificate referred to in section
1515(b) indicates that the foreign proceeding is a foreign
proceeding as defined in section 101 and that the person
or body is a foreign representative as defined in section 101,
the court is entitled to so presume.
‘‘(b) The court is entitled to presume that documents
submitted in support of the petition for recognition are au-
thentic, whether or not they have been legalized.
‘‘(c) In the absence of evidence to the contrary, the
debtor’s registered office, or habitual residence in the case
of an individual, is presumed to be the center of the debtor’s
main interests.
218
‘‘§ 1517. Order recognizing a foreign proceeding
‘‘(a) Subject to section 1506, after notice and a hearing
an order recognizing a foreign proceeding shall be entered
if—
‘‘(1) the foreign proceeding is a foreign main
proceeding or foreign nonmain proceeding within the
meaning of section 1502;
‘‘(2) the foreign representative applying for rec-
ognition is a person or body as defined in section
101; and
‘‘(3) the petition meets the requirements of sec-
tion 1515.
‘‘(b) The foreign proceeding shall be recognized—
‘‘(1) as a foreign main proceeding if it is taking
place in the country where the debtor has the center
of its main interests; or
‘‘(2) as a foreign nonmain proceeding if the debt-
or has an establishment within the meaning of section
1502 in the foreign country where the proceeding is
pending.
‘‘(c) A petition for recognition of a foreign proceeding
shall be decided upon at the earliest possible time. Entry
of an order recognizing a foreign proceeding constitutes rec-
ognition under this chapter.
‘‘(d) The provisions of this subchapter do not prevent
modification or termination of recognition if it is shown
219
that the grounds for granting it were fully or partially lack-
ing or have ceased to exist, but in considering such action
the court shall give due weight to possible prejudice to par-
ties that have relied upon the granting of recognition. The
case under this chapter may be closed in the manner pre-
scribed under section 350.
‘‘§ 1518. Subsequent information
‘‘From the time of filing the petition for recognition
of the foreign proceeding, the foreign representative shall file
with the court promptly a notice of change of status
concerning—
‘‘(1) any substantial change in the status of the
foreign proceeding or the status of the foreign rep-
resentative’s appointment; and
‘‘(2) any other foreign proceeding regarding the
debtor that becomes known to the foreign representa-
tive.
‘‘§ 1519. Relief that may be granted upon petition for
recognition of a foreign proceeding
‘‘(a) From the time of filing a petition for recognition
until the court rules on the petition, the court may, at the
request of the foreign representative, where relief is urgently
needed to protect the assets of the debtor or the interests
of the creditors, grant relief of a provisional nature,
including—
220
‘‘(1) staying execution against the debtor’s assets;
‘‘(2) entrusting the administration or realization
of all or part of the debtor’s assets located in the
United States to the foreign representative or another
person authorized by the court, including an exam-
iner, in order to protect and preserve the value of as-
sets that, by their nature or because of other cir-
cumstances, are perishable, susceptible to devaluation
or otherwise in jeopardy; and
‘‘(3) any relief referred to in paragraph (3), (4),
or (7) of section 1521(a).
‘‘(b) Unless extended under section 1521(a)(6), the re-
lief granted under this section terminates when the petition
for recognition is decided upon.
‘‘(c) It is a ground for denial of relief under this sec-
tion that such relief would interfere with the administration
of a foreign main proceeding.
‘‘(d) The court may not enjoin a police or regulatory
act of a governmental unit, including a criminal action or
proceeding, under this section.
‘‘(e) The standards, procedures, and limitations appli-
cable to an injunction shall apply to relief under this sec-
tion.
221
‘‘§ 1520. Effects of recognition of a foreign main pro-
ceeding
‘‘(a) Upon recognition of a foreign proceeding that is
a foreign main proceeding—
‘‘(1) sections 361 and 362 with respect to the
debtor and that property of the debtor that is within
the territorial jurisdiction of the United States;
‘‘(2) sections 363, 549, and 552 of this title
apply to a transfer of an interest of the debtor in
property that is within the territorial jurisdiction of
the United States to the same extent that the sections
would apply to property of an estate;
‘‘(3) unless the court orders otherwise, the foreign
representative may operate the debtor’s business and
may exercise the rights and powers of a trustee under
and to the extent provided by sections 363 and 552;
and
‘‘(4) section 552 applies to property of the debtor
that is within the territorial jurisdiction of the
United States.’’.
‘‘(b) Subsection (a) does not affect the right to com-
mence an individual action or proceeding in a foreign
country to the extent necessary to preserve a claim against
the debtor.
‘‘(c) Subsection (a) does not affect the right of a foreign
representative or an entity to file a petition commencing
222
a case under this title or the right of any party to file
claims or take other proper actions in such a case.
‘‘§ 1521. Relief that may be granted upon recognition
of a foreign proceeding
‘‘(a) Upon recognition of a foreign proceeding, whether
main or nonmain, where necessary to effectuate the purpose
of this chapter and to protect the assets of the debtor or
the interests of the creditors, the court may, at the request
of the foreign representative, grant any appropriate relief,
including—
‘‘(1) staying the commencement or continuation
of an individual action or proceeding concerning the
debtor’s assets, rights, obligations or liabilities to the
extent they have not been stayed under section
1520(a);
‘‘(2) staying execution against the debtor’s assets
to the extent it has not been stayed under section
1520(a);
‘‘(3) suspending the right to transfer, encumber
or otherwise dispose of any assets of the debtor to the
extent this right has not been suspended under section
1520(a);
‘‘(4) providing for the examination of witnesses,
the taking of evidence or the delivery of information
223
concerning the debtor’s assets, affairs, rights, obliga-
tions or liabilities;
‘‘(5) entrusting the administration or realization
of all or part of the debtor’s assets within the terri-
torial jurisdiction of the United States to the foreign
representative or another person, including an exam-
iner, authorized by the court;
‘‘(6) extending relief granted under section
1519(a); and
‘‘(7) granting any additional relief that may be
available to a trustee, except for relief available under
sections 522, 544, 545, 547, 548, 550, and 724(a).
‘‘(b) Upon recognition of a foreign proceeding, whether
main or nonmain, the court may, at the request of the for-
eign representative, entrust the distribution of all or part
of the debtor’s assets located in the United States to the for-
eign representative or another person, including an exam-
iner, authorized by the court, provided that the court is sat-
isfied that the interests of creditors in the United States
are sufficiently protected.
‘‘(c) In granting relief under this section to a rep-
resentative of a foreign nonmain proceeding, the court must
be satisfied that the relief relates to assets that, under the
law of the United States, should be administered in the for-
224
eign nonmain proceeding or concerns information required
in that proceeding.
‘‘(d) The court may not enjoin a police or regulatory
act of a governmental unit, including a criminal action or
proceeding, under this section.
‘‘(e) The standards, procedures, and limitations appli-
cable to an injunction shall apply to relief under para-
graphs (1), (2), (3), and (6) of subsection (a).
‘‘§ 1522. Protection of creditors and other interested
persons
‘‘(a) The court may grant relief under section 1519
or 1521, or may modify or terminate relief under subsection
(c), only if the interests of the creditors and other interested
entities, including the debtor, are sufficiently protected.
‘‘(b) The court may subject relief granted under section
1519 or 1521, or the operation of the debtor’s business under
section 1520(a)(3) of this title, to conditions it considers
appropriate, including the giving of security or the filing
of a bond.
‘‘(c) The court may, at the request of the foreign rep-
resentative or an entity affected by relief granted under sec-
tion 1519 or 1521, or at its own motion, modify or termi-
nate such relief.
‘‘(d) Section 1104(d) shall apply to the appointment
of an examiner under this chapter. Any examiner shall
225
comply with the qualification requirements imposed on a
trustee by section 322.
‘‘§ 1523. Actions to avoid acts detrimental to creditors
‘‘(a) Upon recognition of a foreign proceeding, the for-
eign representative has standing in a case concerning the
debtor pending under another chapter of this title to initiate
actions under sections 522, 544, 545, 547, 548, 550, and
724(a).
‘‘(b) When the foreign proceeding is a foreign nonmain
proceeding, the court must be satisfied that an action under
subsection (a) relates to assets that, under United States
law, should be administered in the foreign nonmain pro-
ceeding.
‘‘§ 1524. Intervention by a foreign representative
‘‘Upon recognition of a foreign proceeding, the foreign
representative may intervene in any proceedings in a State
or Federal court in the United States in which the debtor
is a party.
226
‘‘SUBCHAPTER IV—COOPERATION WITH FOR-
EIGN COURTS AND FOREIGN REPRESENTA-
TIVES
‘‘§ 1525. Cooperation and direct communication be-
tween the court and foreign courts or for-
eign representatives
‘‘(a) Consistent with section 1501, the court shall co-
operate to the maximum extent possible with foreign courts
or foreign representatives, either directly or through the
trustee.
‘‘(b) The court is entitled to communicate directly
with, or to request information or assistance directly from,
foreign courts or foreign representatives, subject to the rights
of parties in interest to notice and participation.
‘‘§ 1526. Cooperation and direct communication be-
tween the trustee and foreign courts or
foreign representatives
‘‘(a) Consistent with section 1501, the trustee or other
person, including an examiner, authorized by the court,
shall, subject to the supervision of the court, cooperate to
the maximum extent possible with foreign courts or foreign
representatives.
‘‘(b) The trustee or other person, including an exam-
iner, authorized by the court is entitled, subject to the super-
227
vision of the court, to communicate directly with foreign
courts or foreign representatives.
‘‘§ 1527. Forms of cooperation
‘‘Cooperation referred to in sections 1525 and 1526
may 
be 
implemented 
by 
any 
appropriate 
means,
including—
‘‘(1) appointment of a person or body, including
an examiner, to act at the direction of the court;
‘‘(2) communication of information by any
means considered appropriate by the court;
‘‘(3) coordination of the administration and su-
pervision of the debtor’s assets and affairs;
‘‘(4) approval or implementation of agreements
concerning the coordination of proceedings; and
‘‘(5) coordination of concurrent proceedings re-
garding the same debtor.
‘‘SUBCHAPTER V—CONCURRENT PROCEEDINGS
‘‘§ 1528. Commencement of a case under this title after
recognition of a foreign main proceeding
‘‘After recognition of a foreign main proceeding, a case
under another chapter of this title may be commenced only
if the debtor has assets in the United States. The effects of
such case shall be restricted to the assets of the debtor that
are within the territorial jurisdiction of the United States
and, to the extent necessary to implement cooperation and
228
coordination under sections 1525, 1526, and 1527, to other
assets of the debtor that are within the jurisdiction of the
court under sections 541(a) of this title, and 1334(e) of title
28, to the extent that such other assets are not subject to
the jurisdiction and control of a foreign proceeding that has
been recognized under this chapter.
‘‘§ 1529. Coordination of a case under this title and a
foreign proceeding
‘‘Where a foreign proceeding and a case under another
chapter of this title are taking place concurrently regarding
the same debtor, the court shall seek cooperation and coordi-
nation under sections 1525, 1526, and 1527, and the fol-
lowing shall apply:
‘‘(1) When the case in the United States is tak-
ing place at the time the petition for recognition of
the foreign proceeding is filed—
‘‘(A) any relief granted under sections 1519
or 1521 must be consistent with the relief grant-
ed in the case in the United States; and
‘‘(B) even if the foreign proceeding is recog-
nized as a foreign main proceeding, section 1520
does not apply.
‘‘(2) When a case in the United States under this
title commences after recognition, or after the filing of
229
the 
petition 
for 
recognition, 
of 
the 
foreign
proceeding—
‘‘(A) any relief in effect under sections 1519
or 1521 shall be reviewed by the court and shall
be modified or terminated if inconsistent with
the case in the United States; and
‘‘(B) if the foreign proceeding is a foreign
main proceeding, the stay and suspension re-
ferred to in section 1520(a) shall be modified or
terminated if inconsistent with the relief granted
in the case in the United States.
‘‘(3) In granting, extending, or modifying relief
granted to a representative of a foreign nonmain pro-
ceeding, the court must be satisfied that the relief re-
lates to assets that, under the law of the United
States, should be administered in the foreign nonmain
proceeding or concerns information required in that
proceeding.
‘‘(4) In achieving cooperation and coordination
under sections 1528 and 1529, the court may grant
any of the relief authorized under section 305.
‘‘§ 1530. Coordination of more than 1 foreign pro-
ceeding
‘‘In matters referred to in section 1501, with respect
to more than 1 foreign proceeding regarding the debtor, the
230
court shall seek cooperation and coordination under sections
1525, 1526, and 1527, and the following shall apply:
‘‘(1) Any relief granted under section 1519 or
1521 to a representative of a foreign nonmain pro-
ceeding after recognition of a foreign main proceeding
must be consistent with the foreign main proceeding.
‘‘(2) If a foreign main proceeding is recognized
after recognition, or after the filing of a petition for
recognition, of a foreign nonmain proceeding, any re-
lief in effect under section 1519 or 1521 shall be re-
viewed by the court and shall be modified or termi-
nated if inconsistent with the foreign main pro-
ceeding.
‘‘(3) If, after recognition of a foreign nonmain
proceeding, another foreign nonmain proceeding is
recognized, the court shall grant, modify, or terminate
relief for the purpose of facilitating coordination of
the proceedings.
‘‘§ 1531. Presumption of insolvency based on recogni-
tion of a foreign main proceeding
‘‘In the absence of evidence to the contrary, recognition
of a foreign main proceeding is for the purpose of com-
mencing a proceeding under section 303, proof that the
debtor is generally not paying its debts as such debts become
due.
231
‘‘§ 1532. Rule of payment in concurrent proceedings
‘‘Without prejudice to secured claims or rights in rem,
a creditor who has received payment with respect to its
claim in a foreign proceeding pursuant to a law relating
to insolvency may not receive a payment for the same claim
in a case under any other chapter of this title regarding
the debtor, so long as the payment to other creditors of the
same class is proportionately less than the payment the
creditor has already received.’’.
(b) CLERICAL AMENDMENT.—The table of chapters for
title 11, United States Code, is amended by inserting after
the item relating to chapter 13 the following:
‘‘15. Ancillary and Other Cross-Border Cases ........................... 1501’’.
SEC. 902. AMENDMENTS TO OTHER CHAPTERS IN TITLE 11,
UNITED STATES CODE.
(a) APPLICABILITY OF CHAPTERS.—Section 103 of
title 11, United States Code, is amended—
(1) in subsection (a), by inserting before the pe-
riod the following: ‘‘, and this chapter, sections 307,
304, 555 through 557, 559, and 560 apply in a case
under chapter 15’’; and
(2) by adding at the end the following:
‘‘(j) Chapter 15 applies only in a case under such
chapter, except that—
‘‘(1) sections 1505, 1513, and 1514 apply in all
cases under this title; and
232
‘‘(2) section 1509 applies whether or not a case
under this title is pending.’’.
(b) DEFINITIONS.—Paragraphs (23) and (24) of title
11, United States Code, are amended to read as follows:
‘‘(23) ‘foreign proceeding’ means a collective ju-
dicial or administrative proceeding in a foreign coun-
try, including an interim proceeding, under a law re-
lating to insolvency or adjustment of debt in which
proceeding the assets and affairs of the debtor are sub-
ject to control or supervision by a foreign court, for
the purpose of reorganization or liquidation;
‘‘(24) ‘foreign representative’ means a person or
body, including a person or body appointed on an in-
terim basis, authorized in a foreign proceeding to ad-
minister the reorganization or the liquidation of the
debtor’s assets or affairs or to act as a representative
of the foreign proceeding;’’.
(c) AMENDMENTS
TO TITLE 28, UNITED STATES
CODE.—
(1) PROCEDURES.—Section 157(b)(2) of title 28,
United States Code, is amended—
(A) in subparagraph (N), by striking ‘‘and’’
at the end;
(B) in subparagraph (O), by striking the
period at the end and inserting ‘‘; and’’; and
233
(C) by adding at the end the following:
‘‘(P) recognition of foreign proceedings and other
matters under chapter 15 of title 11.’’.
(2) BANKRUPTCY
CASES
AND
PROCEEDINGS.—
Section 1334(c) of title 28, United States Code, is
amended by striking ‘‘Nothing in’’ and inserting ‘‘Ex-
cept with respect to a case under chapter 15 of title
11, nothing in’’.
(3) DUTIES OF TRUSTEES.—Section 586(a)(3) of
title 28, United States Code, is amended by striking
‘‘or 13’’ and inserting ‘‘13, or 15,’’ after ‘‘chapter’’.
(4) Section 305(a)(2) of title 11, United States
Code, is amended to read:
‘‘(2)(A) a petition under section 1515 of this title
for recognition of a foreign proceeding has been grant-
ed; and
‘‘(B) the purposes of chapter 15 of this title
would be best served by such dismissal or suspen-
sion.’’.
(5) Section 508 of title 11, United States Code,
is amended by striking subsection (a) and by striking
out the letter ‘‘(b)’’ at the beginning of the second
paragraph.
234
TITLE X—FINANCIAL CONTRACT
PROVISIONS
SEC. 1001. TREATMENT OF CERTAIN AGREEMENTS BY CON-
SERVATORS OR ––RECEIVERS OF INSURED
DEPOSITORY INSTITUTIONS.
(a) DEFINITION
OF
QUALIFIED
FINANCIAL
CON-
TRACT.—Section 11(e)(8)(D)(i) of the Federal Deposit In-
surance Act (12 U.S.C. 1821(e)(8)(D)(i)) is amended by in-
serting ‘‘, resolution or order’’ after ‘‘any similar agreement
that the Corporation determines by regulation’’.
(b) DEFINITION OF SECURITIES CONTRACT.—Section
11(e)(8)(D)(ii) of the Federal Deposit Insurance Act (12
U.S.C. 1821(e)(8)(D)(ii)) is amended to read as follows:
‘‘(ii) 
SECURITIES
CONTRACT.—The
term ‘securities contract’—
‘‘(I) means a contract for the pur-
chase, sale, or loan of a security, a cer-
tificate of deposit, a mortgage loan, or
any interest in a mortgage loan, a
group or index of securities, certificates
of deposit, or mortgage loans or inter-
ests therein (including any interest
therein or based on the value thereof)
or any option on any of the foregoing,
including any option to purchase or
235
sell any such security, certificate of de-
posit, loan, interest, group or index, or
option;
‘‘(II) does not include any pur-
chase, sale, or repurchase obligation
under a participation in a commercial
mortgage loan unless the Corporation
determines by regulation, resolution, or
order to include any such agreement
within the meaning of such term;
‘‘(III) means any option entered
into on a national securities exchange
relating to foreign currencies;
‘‘(IV) means the guarantee by or
to any securities clearing agency of
any settlement of cash, securities, cer-
tificates of deposit, mortgage loans or
interests therein, group or index of se-
curities, certificates of deposit, or mort-
gage loans or interests therein (includ-
ing any interest therein or based on
the value thereof) or option on any of
the foregoing, including any option to
purchase or sell any such security, cer-
236
tificate of deposit, loan, interest, group
or index or option;
‘‘(V) means any margin loan;
‘‘(VI) means any other agreement
or transaction that is similar to any
agreement or transaction referred to in
this clause;
‘‘(VII) means any combination of
the agreements or transactions referred
to in this clause;
‘‘(VIII) means any option to enter
into any agreement or transaction re-
ferred to in this clause;
‘‘(IX) means a master agreement
that provides for an agreement or
transaction referred to in subclause (I),
(III), (IV), (V), (VI), (VII), or (VIII),
together with all supplements to any
such master agreement, without regard
to whether the master agreement pro-
vides for an agreement or transaction
that is not a securities contract under
this clause, except that the master
agreement shall be considered to be a
securities contract under this clause
237
only with respect to each agreement or
transaction under the master agree-
ment that is referred to in subclause
(I), (III), (IV), (V), (VI), (VII), or
(VIII); and
‘‘(X) means any security agree-
ment or arrangement or other credit
enhancement related to any agreement
or transaction referred to in this
clause.’’.
(c) DEFINITION OF COMMODITY CONTRACT.—Section
11(e)(8)(D)(iii) of the Federal Deposit Insurance Act (12
U.S.C. 1821(e)(8)(D)(iii)) is amended to read as follows:
‘‘(iii) 
COMMODITY
CONTRACT.—The
term ‘commodity contract’ means—
‘‘(I) with respect to a futures com-
mission merchant, a contract for the
purchase or sale of a commodity for fu-
ture delivery on, or subject to the rules
of, a contract market or board of trade;
‘‘(II) with respect to a foreign fu-
tures commission merchant, a foreign
future;
238
‘‘(III) with respect to a leverage
transaction merchant, a leverage trans-
action;
‘‘(IV) with respect to a clearing
organization, a contract for the pur-
chase or sale of a commodity for future
delivery on, or subject to the rules of,
a contract market or board of trade
that is cleared by such clearing organi-
zation, or commodity option traded on,
or subject to the rules of, a contract
market or board of trade that is
cleared by such clearing organization;
‘‘(V) with respect to a commodity
options dealer, a commodity option;
‘‘(VI) any other agreement or
transaction that is similar to any
agreement or transaction referred to in
this clause;
‘‘(VII) any combination of the
agreements or transactions referred to
in this clause;
‘‘(VIII) any option to enter into
any agreement or transaction referred
to in this clause;
239
‘‘(IX) a master agreement that
provides for an agreement or trans-
action referred to in subclause (I), (II),
(III), (IV), (V), (VI), (VII), or (VIII),
together with all supplements to any
such master agreement, without regard
to whether the master agreement pro-
vides for an agreement or transaction
that is not a commodity contract
under this clause, except that the mas-
ter agreement shall be considered to be
a commodity contract under this clause
only with respect to each agreement or
transaction under the master agree-
ment that is referred to in subclause
(I), (II), (III), (IV), (V), (VI), (VII), or
(VIII); or
‘‘(X) a security agreement or ar-
rangement or other credit enhancement
related to any agreement or trans-
action referred to in this clause.’’.
(d) DEFINITION
OF FORWARD CONTRACT.—Section
11(e)(8)(D)(iv) of the Federal Deposit Insurance Act (12
U.S.C. 1821(e)(8)(D)(iv)) is amended to read as follows:
240
‘‘(iv) FORWARD CONTRACT.—The term
‘forward contract’ means—
‘‘(I) a contract (other than a com-
modity contract) for the purchase, sale,
or transfer of a commodity or any
similar good, article, service, right, or
interest which is presently or in the fu-
ture becomes the subject of dealing in
the forward contract trade, or product
or byproduct thereof, with a maturity
date more than 2 days after the date
the contract is entered into, including,
but not limited to, a repurchase agree-
ment, reverse repurchase agreement,
consignment, lease, swap, hedge trans-
action, deposit, loan, option, allocated
transaction, unallocated transaction,
or any other similar agreement;
‘‘(II) any combination of agree-
ments or transactions referred to in
subclauses (I) and (III);
‘‘(III) any option to enter into
any agreement or transaction referred
to in subclause (I) or (II);
241
‘‘(IV) a master agreement that
provides for an agreement or trans-
action referred to in subclauses (I),
(II), or (III), together with all supple-
ments to any such master agreement,
without regard to whether the master
agreement provides for an agreement
or transaction that is not a forward
contract under this clause, except that
the master agreement shall be consid-
ered to be a forward contract under
this clause only with respect to each
agreement or transaction under the
master agreement that is referred to in
subclause (I), (II), or (III); or
‘‘(V) a security agreement or ar-
rangement or other credit enhancement
related to any agreement or trans-
action referred to in subclause (I), (II),
(III), or (IV).’’.
(e) DEFINITION OF REPURCHASE AGREEMENT.—Sec-
tion 11(e)(8)(D)(v) of the Federal Deposit Insurance Act
(12 U.S.C. 1821(e)(8)(D)(v)) is amended to read as follows:
‘‘(v) REPURCHASE
AGREEMENT.—The
term ‘repurchase agreement’ (which defini-
242
tion also applies to a reverse repurchase
agreement)—
‘‘(I) mean an agreement, includ-
ing related terms, which provides for
the transfer of 1 or more certificates of
deposit, mortgage-related securities (as
such term is defined in the Securities
Exchange Act of 1934), mortgage loans,
interests in mortgage-related securities
or mortgage loans, eligible bankers’ ac-
ceptances, qualified foreign government
securities or securities that are direct
obligations of, or that are fully guaran-
teed by, the United States or any agen-
cy of the United States against the
transfer of funds by the transferee of
such certificates of deposit, eligible
bankers’ acceptances, securities, loans,
or interests with a simultaneous agree-
ment by such transferee to transfer to
the transferor thereof certificates of de-
posit, eligible bankers’ acceptances, se-
curities, loans, or interests as described
above, at a date certain not later than
1 year after such transfers or on de-
243
mand, against the transfer of funds, or
any other similar agreement;
‘‘(II) does not include any repur-
chase obligation under a participation
in a commercial mortgage loan unless
the Corporation determines by regula-
tion, resolution, or order to include
any such participation within the
meaning of such term;
‘‘(III) means any combination of
agreements or transactions referred to
in subclauses (I) and (IV);
‘‘(IV) means any option to enter
into any agreement or transaction re-
ferred to in subclause (I) or (III);
‘‘(V) means a master agreement
that provides for an agreement or
transaction referred to in subclause (I),
(III), or (IV), together with all supple-
ments to any such master agreement,
without regard to whether the master
agreement provides for an agreement
or transaction that is not a repurchase
agreement under this clause, except
that the master agreement shall be con-
244
sidered to be a repurchase agreement
under this subclause only with respect
to each agreement or transaction under
the master agreement that is referred to
in subclause (I), (III), or (IV); and
‘‘(VI) means a security agreement
or arrangement or other credit en-
hancement related to any agreement or
transaction referred to in subclause (I),
(III), (IV), or (V).
For purposes of this clause, the term ‘quali-
fied foreign government security’ means a
security that is a direct obligation of, or
that is fully guaranteed by, the central gov-
ernment of a member of the Organization
for Economic Cooperation and Development
(as determined by regulation or order
adopted by the appropriate Federal banking
authority).’’.
(f) DEFINITION
OF
SWAP
AGREEMENT.—Section
11(e)(8)(D)(iv) of the Federal Deposit Insurance Act (12
U.S.C. 1821(e)(8)(D)(vi)) is amended to read as follows:
‘‘(vi) SWAP
AGREEMENT.—The term
‘swap agreement’ means—
245
‘‘(I) any agreement, including the
terms and conditions incorporated by
reference in any such agreement, which
is an interest rate swap, option, future,
or forward agreement, including a rate
floor, rate cap, rate collar, cross-cur-
rency rate swap, and basis swap; a
spot, same day-tomorrow, tomorrow-
next, forward, or other foreign ex-
change or precious metals agreement; a
currency swap, option, future, or for-
ward agreement; an equity index or eq-
uity swap, option, future, or forward
agreement; a debt index or debt swap,
option, future, or forward agreement; a
credit spread or credit swap, option,
future, or forward agreement; a com-
modity index or commodity swap, op-
tion, future, or forward agreement;
‘‘(II) any agreement or trans-
action similar to any other agreement
or transaction referred to in this clause
that is presently, or in the future be-
comes, regularly entered into in the
swap market (including terms and
246
conditions incorporated by reference in
such agreement) and that is a forward,
swap, future, or option on 1 or more
rates, currencies, commodities, equity
securities or other equity instruments,
debt securities or other debt instru-
ments, or economic indices or measures
of economic risk or value;
‘‘(III) any combination of agree-
ments or transactions referred to in
this clause;
‘‘(IV) any option to enter into
any agreement or transaction referred
to in this clause;
‘‘(V) a master agreement that pro-
vides for an agreement or transaction
referred to in subclause (I), (II), (III),
or (IV), together with all supplements
to any such master agreement, without
regard to whether the master agreement
contains an agreement or transaction
that is not a swap agreement under
this clause, except that the master
agreement shall be considered to be a
swap agreement under this clause only
247
with respect to each agreement or
transaction under the master agree-
ment that is referred to in subclause
(I), (II), (III), or (IV); and
‘‘(VI) any security agreement or
arrangement or other credit enhance-
ment related to any agreements or
transactions referred to in subpara-
graph (I), (II), (III), or (IV).
Such term is applicable for purposes of this
title only and shall not be construed or ap-
plied so as to challenge or affect the charac-
terization, definition, or treatment of any
swap agreement under any other statute,
regulation, or rule, including the Securities
Act of 1933, the Securities Exchange Act of
1934, the Public Utility Holding Company
Act of 1935, the Trust Indenture Act of
1939, the Investment Company Act of 1940,
the Investment Advisers Act of 1940, the Se-
curities Investor Protection Act of 1970, the
Commodity Exchange Act, and the regula-
tions promulgated by the Securities and Ex-
change Commission or the Commodity Fu-
tures Trading Commission.’’.
248
(g) 
DEFINITION
OF
TRANSFER.—Section
11(e)(8)(D)(viii) of the Federal Deposit Insurance Act (12
U.S.C. 1821(e)(8)(D)(viii)) is amended to read as follows:
‘‘(viii) TRANSFER.—The term ‘trans-
fer’ means every mode, direct or indirect,
absolute or conditional, voluntary or invol-
untary, of disposing of or parting with
property or with an interest in property,
including retention of title as a security in-
terest and foreclosure of the depository
institutions’s equity of redemption.’’.
(h) TREATMENT
OF
QUALIFIED
FINANCIAL
CON-
TRACTS.—Section 11(e)(8) of the Federal Deposit Insurance
Act (12 U.S.C. 1821(e)(8)) is amended—
(1) in subparagraph (A), by striking ‘‘paragraph
(10)’’ and inserting ‘‘paragraphs (9) and (10)’’;
(2) in subparagraph (A)(i), by striking ‘‘to cause
the termination or liquidation’’ and inserting ‘‘such
person has to cause the termination, liquidation, or
acceleration’’;
(3) by amending subparagraph (A)(ii) to read as
follows:
‘‘(ii) any right under any security
agreement or arrangement or other credit
enhancement related to 1 or more qualified
249
financial contracts described in clause (i);’’;
and
(4) by amending subparagraph (E)(ii) to read
as follows:
‘‘(ii) any right under any security
agreement or arrangement or other credit
enhancement related to 1 or more qualified
financial contracts described in clause (i);’’.
(i) 
AVOIDANCE
OF
TRANSFERS.—Section
11(e)(8)(C)(i) of the Federal Deposit Insurance Act (12
U.S.C. 1821(e)(8)(C)(i)) is amended by inserting ‘‘section
5242 of the Revised Statutes of the United States (12 U.S.C.
91) or any other Federal or State law relating to the avoid-
ance of preferential or fraudulent transfers,’’ before ‘‘the
Corporation’’.
SEC. 1002. AUTHORITY OF THE CORPORATION WITH RE-
SPECT TO FAILED AND FAILING INSTITU-
TIONS.
(a) IN GENERAL.—Section 11(e)(8) of the Federal De-
posit Insurance Act (12 U.S.C. 1821(e)(8)) is amended—
(1) in subparagraph (E), by striking ‘‘other than
paragraph (12) of this subsection, subsection (d)(9)’’
and inserting ‘‘other than subsections (d)(9) and
(e)(10)’’; and
250
(2) by adding at the end the following new sub-
paragraphs:
‘‘(F) CLARIFICATION.—No provision of law
shall be construed as limiting the right or power
of the Corporation, or authorizing any court or
agency to limit or delay, in any manner, the
right or power of the Corporation to transfer any
qualified financial contract in accordance with
paragraphs (9) and (10) of this subsection or to
disaffirm or repudiate any such contract in ac-
cordance with subsection (e)(1) of this section.
‘‘(G) WALKAWAY
CLAUSES
NOT
EFFEC-
TIVE.—
‘‘(i) IN
GENERAL.—Notwithstanding
the provisions of subparagraphs (A) and
(E), and sections 403 and 404 of the Fed-
eral Deposit Insurance Corporation Im-
provement Act of 1991, no walkaway clause
shall be enforceable in a qualified financial
contract of an insured depository institu-
tion in default.
‘‘(ii) WALKAWAY CLAUSE DEFINED.—
For purposes of this subparagraph, the term
‘walkaway clause’ means a provision in a
qualified financial contract that, after cal-
251
culation of a value of a party’s position or
an amount due to or from 1 of the parties
in accordance with its terms upon termi-
nation, liquidation, or acceleration of the
qualified financial contract, either does not
create a payment obligation of a party or
extinguishes a payment obligation of a
party in whole or in part solely because of
such party’s status as a nondefaulting
party.’’.
(b) TECHNICAL AND CONFORMING AMENDMENT.—Sec-
tion 11(e)(12)(A) of the Federal Deposit Insurance Act (12
U.S.C. 1821(e)(12)(A)) is amended by inserting ‘‘or the ex-
ercise of rights or powers’’ after ‘‘the appointment’’.
SEC. 1003. AMENDMENTS RELATING TO TRANSFERS OF
QUALIFIED FINANCIAL CONTRACTS.
(a) TRANSFERS OF QUALIFIED FINANCIAL CONTRACTS
TO FINANCIAL INSTITUTIONS.—Section 11(e)(9) of the Fed-
eral Deposit Insurance Act (12 U.S.C. 1821(e)(9)) is
amended to read as follows:
‘‘(9) TRANSFER OF QUALIFIED FINANCIAL CON-
TRACTS.—
‘‘(A) IN GENERAL.—In making any transfer
of assets or liabilities of a depository institution
in default which includes any qualified financial
252
contract, the conservator or receiver for such de-
pository institution shall either—
‘‘(i) transfer to 1 financial institution,
other than a financial institution for which
a conservator, receiver, trustee in bank-
ruptcy, or other legal custodian has been
appointed or which is otherwise the subject
of a bankruptcy or insolvency proceeding—
‘‘(I) all qualified financial con-
tracts between any person or any affil-
iate of such person and the depository
institution in default;
‘‘(II) all claims of such person or
any affiliate of such person against
such depository institution under any
such contract (other than any claim
which, under the terms of any such
contract, is subordinated to the claims
of general unsecured creditors of such
institution);
‘‘(III) all claims of such deposi-
tory institution against such person or
any affiliate of such person under any
such contract; and
253
‘‘(IV) all property securing or any
other credit enhancement for any con-
tract described in subclause (I) or any
claim described in subclause (II) or
(III) under any such contract; or
‘‘(ii) transfer none of the qualified fi-
nancial contracts, claims, property or other
credit enhancement referred to in clause (i)
(with respect to such person and any affil-
iate of such person).
‘‘(B) TRANSFER TO FOREIGN BANK, FOR-
EIGN
FINANCIAL
INSTITUTION, OR
BRANCH
OR
AGENCY OF A FOREIGN BANK OR FINANCIAL IN-
STITUTION.—In transferring any qualified fi-
nancial contracts and related claims and prop-
erty pursuant to subparagraph (A)(i), the con-
servator or receiver for such depository institu-
tion shall not make such transfer to a foreign
bank, financial institution organized under the
laws of a foreign country, or a branch or agency
of a foreign bank or financial institution unless,
under the law applicable to such bank, financial
institution, branch or agency, to the qualified fi-
nancial contracts, and to any netting contract,
any security agreement or arrangement or other
254
credit enhancement related to 1 or more qualified
financial contracts, the contractual rights of the
parties to such qualified financial contracts, net-
ting contracts, security agreements or arrange-
ments, or other credit enhancements are enforce-
able substantially to the same extent as per-
mitted under this section.
‘‘(C) TRANSFER OF CONTRACTS SUBJECT TO
THE RULES OF A CLEARING ORGANIZATION.—In
the event that a conservator or receiver transfers
any qualified financial contract and related
claims, property and credit enhancements pursu-
ant to subparagraph (A)(i) and such contract is
subject to the rules of a clearing organization,
the clearing organization shall not be required to
accept the transferee as a member by virtue of
the transfer.
‘‘(D) DEFINITION.—For purposes of this
section, the term ‘financial institution’ means a
broker or dealer, a depository institution, a fu-
tures commission merchant, or any other institu-
tion as determined by the Corporation by regula-
tion to be a financial institution.’’.
(b) NOTICE
TO QUALIFIED FINANCIAL CONTRACT
COUNTERPARTIES.—Section 11(e)(10)(A) of the Federal
255
Deposit Insurance Act (12 U.S.C. 1821(e)(10)(A)) is
amended by amending the flush material following clause
(ii) to read as follows: ‘‘the conservator or receiver shall no-
tify any person who is a party to any such contract of such
transfer by 5:00 p.m. (eastern time) on the business day
following the date of the appointment of the receiver, in the
case of a receivership, or the business day following such
transfer, in the case of a conservatorship.’’.
(c) RIGHTS AGAINST RECEIVER AND TREATMENT OF
BRIDGE BANKS.—Section 11(e)(10) of the Federal Deposit
Insurance 
Act 
(12 
U.S.C. 
1821(e)(10)) 
is 
further
amended—
(1) by redesignating subparagraph (B) as sub-
paragraph (D); and
(2) by inserting after subparagraph (A) the fol-
lowing new subparagraphs:
‘‘(B) CERTAIN
RIGHTS
NOT
ENFORCE-
ABLE.—
‘‘(i) RECEIVERSHIP.—A person who is
a party to a qualified financial contract
with an insured depository institution may
not exercise any right such person has to
terminate, liquidate, or net such contract
under paragraph (8)(A) or section 403 or
404 of the Federal Deposit Insurance Cor-
256
poration Improvement Act of 1991 solely by
reason of or incidental to the appointment
of a receiver for the depository institution
(or the insolvency or financial condition of
the depository institution for which the re-
ceiver has been appointed)—
‘‘(I) until 5:00 p.m. (eastern time)
on the business day following the date
of the appointment of the receiver; or
‘‘(II) after the person has received
notice that the contract has been trans-
ferred pursuant to paragraph (9)(A).
‘‘(ii) CONSERVATORSHIP.—A person
who is a party to a qualified financial con-
tract with an insured depository institution
may not exercise any right such person has
to terminate, liquidate, or net such contract
under paragraph (8)(E) or sections 403 or
404 of the Federal Deposit Insurance Cor-
poration Improvement Act of 1991, solely
by reason of or incidental to the appoint-
ment of a conservator for the depository in-
stitution (or the insolvency or financial
condition of the depository institution for
which the conservator has been appointed).
257
‘‘(iii) NOTICE.—For purposes of this
subsection, the Corporation as receiver or
conservator of an insured depository insti-
tution shall be deemed to have notified a
person who is a party to a qualified finan-
cial contract with such depository institu-
tion if the Corporation has taken steps rea-
sonably calculated to provide notice to such
person by the time specified in subpara-
graph (A) of this subsection.
‘‘(C) TREATMENT OF BRIDGE BANKS.—The
following institutions shall not be considered a
financial institution for which a conservator, re-
ceiver, trustee in bankruptcy, or other legal cus-
todian has been appointed or which is otherwise
the subject of a bankruptcy or insolvency pro-
ceeding for purposes of subsection (e)(9)—
‘‘(i) a bridge bank; or
‘‘(ii) a depository institution organized
by the Corporation, for which a conservator
is appointed either—
‘‘(I) immediately upon the organi-
zation of the institution; or
‘‘(II) at the time of a purchase
and assumption transaction between
258
such institution and the Corporation
as receiver for a depository institution
in default.’’.
SEC. 1004. AMENDMENTS RELATING TO DISAFFIRMANCE OR
REPUDIATION 
OF 
QUALIFIED 
FINANCIAL
CONTRACTS.
Section 11(e) of the Federal Deposit Insurance Act (12
U.S.C. 1821(e)) is further amended—
(1) by redesignating paragraphs (11) through
(15) as paragraphs (12) through (16), respectively;
and
(2) by inserting after paragraph (10) the fol-
lowing new paragraph:
‘‘(11) DISAFFIRMANCE
OR
REPUDIATION
OF
QUALIFIED FINANCIAL CONTRACTS.—In exercising the
rights of disaffirmance or repudiation of a conser-
vator or receiver with respect to any qualified finan-
cial contract to which an insured depository institu-
tion is a party, the conservator or receiver for such
institution shall either—
‘‘(A) disaffirm or repudiate all qualified fi-
nancial contracts between—
‘‘(i) any person or any affiliate of such
person; and
259
‘‘(ii) the depository institution in de-
fault; or
‘‘(B) disaffirm or repudiate none of the
qualified financial contracts referred to in sub-
paragraph (A) (with respect to such person or
any affiliate of such person).’’.
SEC. 1005. CLARIFYING AMENDMENT RELATING TO MASTER
AGREEMENTS.
Section 11(e)(8)(D)(vii) of the Federal Deposit Insur-
ance Act (12 U.S.C. 1821(e)(8)(D)(vii)) is amended to read
as follows:
‘‘(vii) TREATMENT OF MASTER AGREE-
MENT
AS
AGREEMENT.—Any master
agreement for any contract or agreement de-
scribed in any preceding clause of this sub-
paragraph (or any master agreement for
such master agreement or agreements), to-
gether with all supplements to such master
agreement, shall be treated as a single
agreement and a single qualified financial
contract. If a master agreement contains
provisions relating to agreements or trans-
actions that are not themselves qualified fi-
nancial contracts, the master agreement
shall be deemed to be a qualified financial
260
contract only with respect to those trans-
actions that are themselves qualified finan-
cial contracts.’’.
SEC. 1006. FEDERAL DEPOSIT INSURANCE CORPORATION
IMPROVEMENT ACT OF 1991.
(a) DEFINITIONS.—Section 402 of the Federal Deposit
Insurance Corporation Improvement Act of 1991 (12 U.S.C.
4402) is amended—
(1) in paragraph (6)—
(A) by redesignating subparagraphs (B)
through (D) as subparagraphs (C) through (E),
respectively;
(B) by inserting after subparagraph (A) the
following new subparagraph:
‘‘(B) an uninsured national bank or an un-
insured State bank that is a member of the Fed-
eral Reserve System if the national bank or
State member bank is not eligible to make appli-
cation to become an insured bank under section
5 of the Federal Deposit Insurance Act;’’; and
(C) by amending subparagraph (C) (as re-
designated) to read as follows:
‘‘(C) a branch or agency of a foreign bank,
a foreign bank and any branch or agency of the
foreign bank, or the foreign bank that established
261
the branch or agency, as those terms are defined
in section 1(b) of the International Banking Act
of 1978;’’;
(2) in paragraph (11), by adding before the pe-
riod ‘‘and any other clearing organization with which
such clearing organization has a netting contract’’;
(3) by amending paragraph (14)(A)(i) to read as
follows:
‘‘(i) means a contract or agreement be-
tween 2 or more financial institutions,
clearing organizations, or members that
provides for netting present or future pay-
ment obligations or payment entitlements
(including liquidation or closeout values re-
lating to such obligations or entitlements)
among the parties to the agreement; and’’;
and
(4) by adding at the end the following new para-
graph:
‘‘(15) PAYMENT.—The term ‘payment’ means a
payment of United States dollars, another currency,
or a composite currency, and a noncash delivery, in-
cluding a payment or delivery to liquidate an
unmatured obligation.’’.
262
(b) ENFORCEABILITY OF BILATERAL NETTING CON-
TRACTS.—Section 403 of the Federal Deposit Insurance
Corporation Improvement Act of 1991 (12 U.S.C. 4403) is
amended—
(1) by amending subsection (a) to read as fol-
lows:
‘‘(a) GENERAL RULE.—Notwithstanding any other
provision of State or Federal law (other than paragraphs
(8)(E), (8)(F), and (10)(B) of section 11(e) of the Federal
Deposit Insurance Act or any order authorized under sec-
tion 5(b)(2) of the Securities Investor Protection Act of
1970, the covered contractual payment obligations and the
covered contractual payment entitlements between any 2 fi-
nancial institutions shall be netted in accordance with, and
subject to the conditions of, the terms of any applicable net-
ting contract (except as provided in section 561(b)(2) of
title 11).’’; and
(2) by adding at the end the following new sub-
section:
‘‘(f) ENFORCEABILITY OF SECURITY AGREEMENTS.—
The provisions of any security agreement or arrangement
or other credit enhancement related to 1 or more netting
contracts between any 2 financial institutions shall be en-
forceable in accordance with their terms (except as provided
in section 561(b)(2) of title 11) and shall not be stayed,
263
avoided, or otherwise limited by any State or Federal law
(other than paragraphs (8)(E), (8)(F), and (10)(B) of sec-
tion 11(e) of the Federal Deposit Insurance Act and section
5(b)(2) of the Securities Investor Protection Act of 1970).’’.
(c) ENFORCEABILITY
OF CLEARING ORGANIZATION
NETTING CONTRACTS.—Section 404 of the Federal Deposit
Insurance Corporation Improvement Act of 1991 (12 U.S.C.
4404) is amended—
(1) by amending subsection (a) to read as fol-
lows:
‘‘(a) GENERAL RULE.—Notwithstanding any other
provision of State or Federal law (other than paragraphs
(8)(E), (8)(F), and (10)(B) of section 11(e) of the Federal
Deposit Insurance Act and any order authorized under sec-
tion 5(b)(2) of the Securities Investor Protection Act of
1970, the covered contractual payment obligations and the
covered contractual payment entitlements of a member of
a clearing organization to and from all other members of
a clearing organization shall be netted in accordance with
and subject to the conditions of any applicable netting con-
tract (except as provided in section 561(b)(2) of title 11,
United States Code).’’; and
(2) by adding at the end the following new sub-
section:
264
‘‘(h) ENFORCEABILITY OF SECURITY AGREEMENTS.—
The provisions of any security agreement or arrangement
or other credit enhancement related to 1 or more netting
contracts between any 2 members of a clearing organization
shall be enforceable in accordance with their terms (except
as provided in section 561(b)(2) of title 11, United States
Code) and shall not be stayed, avoided, or otherwise limited
by any State or Federal law other than paragraphs (8)(E),
(8)(F), and (10)(B) of section 11(e) of the Federal Deposit
Insurance Act and section 5(b)(2) of the Securities Investor
Protection Act of 1970.’’.
(d) ENFORCEABILITY
OF CONTRACTS WITH UNIN-
SURED
NATIONAL
BANKS
AND
UNINSURED
FEDERAL
BRANCHES AND AGENCIES.—The Federal Deposit Insur-
ance Corporation Improvement Act of 1991 (12 U.S.C. 4401
et seq.) is amended—
(1) by redesignating section 407 as section 408;
and
(2) by adding after section 406 the following new
section:
‘‘SEC. 407. TREATMENT OF CONTRACTS WITH UNINSURED
NATIONAL BANKS AND UNINSURED FEDERAL
BRANCHES AND AGENCIES.
‘‘(a) IN GENERAL.—Notwithstanding any other provi-
sion of law, paragraphs (8), (9), (10), and (11) of section
265
11(e) of the Federal Deposit Insurance Act shall apply to
an uninsured national bank or uninsured Federal branch
or Federal agency except—
‘‘(1) any reference to the ‘Corporation as re-
ceiver’ or ‘the receiver or the Corporation’ shall refer
to the receiver of an uninsured national bank or un-
insured Federal branch or Federal agency appointed
by the Comptroller of the Currency;
‘‘(2) any reference to the ‘Corporation’ (other
than in section 11(e)(8)(D) of such Act), the ‘Corpora-
tion, whether acting as such or as conservator or re-
ceiver’, a ‘receiver’, or a ‘conservator’ shall refer to the
receiver or conservator of an uninsured national bank
or uninsured Federal branch or Federal agency ap-
pointed by the Comptroller of the Currency; and
‘‘(3) any reference to an ‘insured depository in-
stitution’ or ‘depository institution’ shall refer to an
uninsured national bank or an uninsured Federal
branch or Federal agency.
‘‘(b) LIABILITY.—The liability of a receiver or conser-
vator of an uninsured national bank or uninsured Federal
branch or agency shall be determined in the same manner
and subject to the same limitations that apply to receivers
and conservators of insured depository institutions under
section 11(e) of the Federal Deposit Insurance Act.
266
‘‘(c) REGULATORY AUTHORITY.—
‘‘(1) IN GENERAL.—The Comptroller of the Cur-
rency, in consultation with the Federal Deposit In-
surance Corporation, may promulgate regulations to
implement this section.
‘‘(2) SPECIFIC REQUIREMENT.—In promulgating
regulations to implement this section, the Comptroller
of the Currency shall ensure that the regulations gen-
erally are consistent with the regulations and policies
of the Federal Deposit Insurance Corporation adopted
pursuant to the Federal Deposit Insurance Act.
‘‘(d) DEFINITIONS.—For purposes of this section, the
terms ‘Federal branch’, ‘Federal agency’, and ‘foreign bank’
have the same meaning as in section 1(b) of the Inter-
national Banking Act.’’.
SEC. 1007. BANKRUPTCY CODE AMENDMENTS.
(a) DEFINITIONS OF FORWARD CONTRACT, REPUR-
CHASE AGREEMENT, SECURITIES CLEARING AGENCY, SWAP
AGREEMENT, COMMODITY CONTRACT, AND SECURITIES
CONTRACT.—Title 11, United States Code, is amended—
(1) in section 101—
(A) in paragraph (25)—
(i) by striking ‘‘means a contract’’ and
inserting ‘‘means—
‘‘(A) a contract’’;
267
(ii) by striking ‘‘, or any combination
thereof or option thereon;’’ and inserting ‘‘,
or any other similar agreement;’’; and
(iii) by adding at the end the fol-
lowing:
‘‘(B) any combination of agreements or
transactions referred to in subparagraphs (A)
and (C);
‘‘(C) any option to enter into an agreement
or transaction referred to in subparagraph (A)
or (B);
‘‘(D) a master agreement that provides for
an agreement or transaction referred to in sub-
paragraph (A), (B), or (C), together with all
supplements to any such master agreement, with-
out regard to whether such master agreement
provides for an agreement or transaction that is
not a forward contract under this paragraph, ex-
cept that such master agreement shall be consid-
ered to be a forward contract under this para-
graph only with respect to each agreement or
transaction under such master agreement that is
referred to in subparagraph (A), (B) or (C); or
‘‘(E) a security agreement or arrangement,
or other credit enhancement related to any agree-
268
ment or transaction referred to in subparagraph
(A), (B), (C), or (D), but not to exceed the actual
value of such contract, option, agreement, or
transaction on the date of the filing of the peti-
tion;’’;
(B) in paragraph (46), by striking ‘‘on any
day during the period beginning 90 days before
the date of’’ and replacing it with ‘‘at any time
before’’;
(C) by amending paragraph (47) to read as
follows:
‘‘(47) ‘repurchase agreement’ (which definition
also applies to a reverse repurchase agreement)
means—
‘‘(i) an agreement, including related
terms, which provides for the transfer of 1
or more certificates of deposit, mortgage-re-
lated securities (as defined in the Securities
Exchange Act of 1934), mortgage loans, in-
terests in mortgage-related securities or
mortgage loans, eligible bankers’ accept-
ances, qualified foreign government securi-
ties; or securities that are direct obligations
of, or that are fully guaranteed by, the
United States or any agency of the United
269
States against the transfer of funds by the
transferee of such certificates of deposit, eli-
gible bankers’ acceptances, securities, loans,
or interests; with a simultaneous agreement
by such transferee to transfer to the trans-
feror thereof certificates of deposit, eligible
bankers’ acceptance, securities, loans, or in-
terests of the kind described above, at a date
certain not later than 1 year after such
transfer or on demand, against the transfer
of funds;
‘‘(ii) any combination of agreements or
transactions referred to in clauses (i) and
(iii);
‘‘(iii) an option to enter into an agree-
ment or transaction referred to in clause (i)
or (ii);
‘‘(iv) a master agreement that provides
for an agreement or transaction referred to
in clause (i), (ii), or (iii), together with all
supplements to any such master agreement,
without regard to whether such master
agreement provides for an agreement or
transaction that is not a repurchase agree-
ment under this paragraph, except that
270
such master agreement shall be considered
to be a repurchase agreement under this
paragraph only with respect to each agree-
ment or transaction under the master agree-
ment that is referred to in clause (i), (ii),
or (iii); or
‘‘(v) a security agreement or arrange-
ment or other credit enhancement related to
any agreement or transaction referred to in
clause (i), (ii), (iii), or (iv), but not to ex-
ceed the actual value of such contract on the
date of the filing of the petition; and
‘‘(B) does not include a repurchase obliga-
tion under a participation in a commercial
mortgage loan;
and, for purposes of this paragraph, the term ‘quali-
fied foreign government security’ means a security
that is a direct obligation of, or that is fully guaran-
teed by, the central government of a member of the
Organization for Economic Cooperation and Develop-
ment;’’;
(D) in paragraph (48) by inserting ‘‘or ex-
empt from such registration under such section
pursuant to an order of the Securities and Ex-
change Commission’’ after ‘‘1934’’; and
271
(E) by amending paragraph (53B) to read
as follows:
‘‘(53B) ‘swap agreement’
‘‘(A) means—
‘‘(i) any agreement, including the
terms and conditions incorporated by ref-
erence in such agreement, which is an inter-
est rate swap, option, future, or forward
agreement, including a rate floor, rate cap,
rate collar, cross-currency rate swap, and
basis swap; a spot, same day-tomorrow, to-
morrow-next, forward, or other foreign ex-
change or precious metals agreement; a cur-
rency swap, option, future, or forward
agreement; an equity index or an equity
swap, option, future, or forward agreement;
a debt index or a debt swap, option, future,
or forward agreement; a credit spread or a
credit swap, option, future, or forward
agreement; or a commodity index or a com-
modity swap, option, future, or forward
agreement;
‘‘(ii) any agreement or transaction
similar to any other agreement or trans-
action referred to in this paragraph that—
272
‘‘(I) is presently, or in the future
becomes, regularly entered into in the
swap market (including terms and
conditions incorporated by reference
therein); and
‘‘(II) is a forward, swap, future,
or option on 1 or more rates, cur-
rencies commodities, equity securities,
or other equity instruments, debt secu-
rities or other debt instruments, or on
an economic index or measure of eco-
nomic risk or value;
‘‘(iii) any combination of agreements
or transactions referred to in this para-
graph;
‘‘(iv) any option to enter into an
agreement or transaction referred to in this
paragraph;
‘‘(v) a master agreement that provides
for an agreement or transaction referred to
in clause (i), (ii), (iii), or (iv), together
with all supplements to any such master
agreement, and without regard to whether
the master agreement contains an agree-
ment or transaction that is not a swap
274
sion or the Commodity Futures Trading Com-
mission.’’;
(2) by amending section 741(7) to read as fol-
lows:
‘‘(7) ‘securities contract’—
‘‘(A) means—
‘‘(i) a contract for the purchase, sale,
or loan of a security, a certificate of deposit,
a mortgage loan or any interest in a mort-
gage loan, a group or index of securities,
certificates of deposit or mortgage loans or
interests therein (including an interest
therein or based on the value thereof), or op-
tion on any of the foregoing, including an
option to purchase or sell any such security
certificate of deposit, loan, interest, group or
index or option;
‘‘(ii) any option entered into on a na-
tional securities exchange relating to foreign
currencies;
‘‘(iii) the guarantee by or to any secu-
rities clearing agency of a settlement of
cash, securities, certificates of deposit mort-
gage loans or interests therein, group or
index of securities, or mortgage loans or in-
275
terests therein (including any interest there-
in or based on the value thereof), or option
on any of the foregoing, including an option
to purchase or sell any such security certifi-
cate of deposit, loan, interest, group or
index or option;
‘‘(iv) any margin loan;
‘‘(v) any other agreement or trans-
action that is similar to an agreement or
transaction referred to in this paragraph;
‘‘(vi) any combination of the agree-
ments or transactions referred to in this
paragraph;
‘‘(vii) any option to enter into any
agreement or transaction referred to in this
paragraph;
‘‘(viii) a master agreement that pro-
vides for an agreement or transaction re-
ferred to in clause (i), (ii), (iii), (iv), (v),
(vi), or (vii), together with all supplements
to any such master agreement, without re-
gard to whether the master agreement pro-
vides for an agreement or transaction that
is not a securities contract under this para-
graph, except that such master agreement
276
shall be considered to be a securities con-
tract under this paragraph only with re-
spect to each agreement or transaction
under such master agreement that is re-
ferred to in clause (i), (ii), (iii), (iv), (v),
(vi), or (vii); or
‘‘(ix) any security agreement or ar-
rangement, or other credit enhancement, re-
lated to any agreement or transaction re-
ferred to in this paragraph, but not to ex-
ceed the actual value of such contract on the
date of the filing of the petition; and
‘‘(B) does not include any purchase, sale, or
repurchase obligation under a participation in a
commercial mortgage loan.’’; and
(3) in section 761(4)—
(A) by striking ‘‘or’’ at the end of subpara-
graph (D); and
(B) by adding at the end the following:
‘‘(F) any other agreement or transaction
that is similar to an agreement or transaction
referred to in this paragraph;
‘‘(G) any combination of the agreements or
transactions referred to in this paragraph;
277
‘‘(H) any option to enter into an agreement
or transaction referred to in this paragraph;
‘‘(I) a master agreement that provides for
an agreement or transaction referred to in sub-
paragraph (A), (B), (C), (D), (E), (F), (G), or
(H), together with all supplements to such mas-
ter netting agreement, without regard to whether
the master netting agreement provides for an
agreement or transaction that is not a com-
modity contract under this paragraph, except
that the master agreement shall be considered to
be a commodity contract under this paragraph
only with respect to each agreement or trans-
action under the master agreement that is re-
ferred to in subparagraph (A), (B), (C), (D),
(E), (F), (G), or (H); or
‘‘(J) a security agreement or arrangement,
or other credit enhancement related to any agree-
ment or transaction referred to in this para-
graph, but not to exceed the actual value of such
contract on the date of the filing of the peti-
tion;’’.
(b) DEFINITIONS OF FINANCIAL INSTITUTION, FINAN-
CIAL
PARTICIPANT, 
AND
FORWARD
CONTRACT
MER-
279
ments or transactions that is described in section
561(a)(2) with the debtor or any other entity (other
than an affiliate) of a total gross dollar value of at
least $1,000,000,000 in notional or actual principal
amount outstanding on any day during the previous
15-month period, or has gross mark-to-market posi-
tions of at least $100,000,000 (aggregated across
counterparties) in 1 or more such agreement or trans-
action with the debtor or any other entity (other than
an affiliate) on any day during the previous 15-
month period;’’; and
(3) by amending paragraph (26) to read as fol-
lows:
‘‘(26) ‘forward contract merchant’ means a Fed-
eral reserve bank, or an entity whose business consists
in whole or in part of entering into forward contracts
as or with merchants or in a commodity, as defined
or in section 761 of this title, or any similar good,
article, service, right, or interest which is presently or
in the future becomes the subject of dealing or in the
forward contract trade;’’.
(c) DEFINITION
OF MASTER NETTING AGREEMENT
AND MASTER NETTING AGREEMENT PARTICIPANT.—Sec-
tion 101 of title 11, United States Code, is amended by in-
serting after paragraph (38) the following new paragraphs:
280
‘‘(38A) ‘master netting agreement’ means an
agreement providing for the exercise of rights, includ-
ing rights of netting, setoff, liquidation, termination,
acceleration, or closeout, under or in connection with
1 or more contracts that are described in any 1 or
more of paragraphs (1) through (5) of section 561(a),
or any security agreement or arrangement or other
credit enhancement related to 1 or more of the fore-
going. If a master netting agreement contains provi-
sions relating to agreements or transactions that are
not contracts described in paragraphs (1) through (5)
of section 561(a), the master netting agreement shall
be deemed to be a master netting agreement only with
respect to those agreements or transactions that are
described in any 1 or more of the paragraphs (1)
through (5) of section 561(a);
‘‘(38B) ‘master netting agreement participant’
means an entity that, at any time before the filing of
the petition, is a party to an outstanding master net-
ting agreement with the debtor;’’.
(d) SWAP AGREEMENTS, SECURITIES CONTRACTS,
COMMODITY CONTRACTS, FORWARD CONTRACTS, REPUR-
CHASE AGREEMENTS, AND MASTER NETTING AGREEMENTS
UNDER THE AUTOMATIC-STAY.—
281
(1) IN
GENERAL.—Section 362(b) of title 11,
United States Code, as amended by sections 118, 132,
136, 142, 203 and 818, is amended—
(A) in paragraph (6), by inserting ‘‘,
pledged to, and under the control of,’’ after ‘‘held
by’’;
(B) in paragraph (7), by inserting ‘‘,
pledged to, and under the control of,’’ after ‘‘held
by’’;
(C) by amending paragraph (17) to read as
follows:
‘‘(17) under subsection (a), of the setoff by a
swap participant of a mutual debt and claim under
or in connection with 1 or more swap agreements that
constitutes the setoff of a claim against the debtor for
any payment or other transfer of property due from
the debtor under or in connection with any swap
agreement against any payment due to the debtor
from the swap participant under or in connection
with any swap agreement or against cash, securities,
or other property held by, pledged to, and under the
control of, or due from such swap participant to mar-
gin guarantee, secure, or settle a swap agreement;’’;
(D) in paragraph (30) by striking ‘‘or’’ at
the end;
282
(E) in paragraph (31) by striking the pe-
riod at the end and inserting ‘‘; or’’; and
(F) by inserting after paragraph (31) the
following new paragraph:
‘‘(32) under subsection (a), of the setoff by a
master netting agreement participant of a mutual
debt and claim under or in connection with 1 or more
master netting agreements or any contract or agree-
ment subject to such agreements that constitutes the
setoff of a claim against the debtor for any payment
or other transfer of property due from the debtor
under or in connection with such agreements or any
contract or agreement subject to such agreements
against any payment due to the debtor from such
master netting agreement participant under or in
connection with such agreements or any contract or
agreement subject to such agreements or against cash,
securities, or other property held by, pledged or and
under the control of, or due from such master netting
agreement participant to margin, guarantee, secure,
or settle such agreements or any contract or agree-
ment subject to such agreements, to the extent such
participant is eligible to exercise such offset rights
under paragraph (6), (7), or (17) for each individual
283
contract covered by the master netting agreement in
issue.’’.
(2) LIMITATION.—Section 362 of title 11, United
States Code, as amended by sections 120, 302, and
412, is amended by adding at the end the following:
‘‘(l) LIMITATION.—The exercise of rights not subject to
the stay arising under subsection (a) pursuant to para-
graph (6), (7), or (17), or (31) of subsection (b) shall not
be stayed by any order of a court or administrative agency
in any proceeding under this title.’’.
(e) LIMITATION OF AVOIDANCE POWERS UNDER MAS-
TER NETTING AGREEMENT.—Section 546 of title 11, United
States Code, as amended by sections 207 and 302, is
amended—
(1) in subsection (g) (as added by section 103 of
Public Law 101–311)—
(A) by striking ‘‘under a swap agreement’’;
(B) by striking ‘‘in connection with a swap
agreement’’ and inserting ‘‘under or in connec-
tion with any swap agreement’’; and
(2) by adding at the end the following:
‘‘(j) 
Notwithstanding 
sections 
544, 
545, 
547,
548(a)(2)(B), and 548(b) of this title, the trustee may not
avoid a transfer made by or to a master netting agreement
participant under or in connection with any master netting
284
agreement or any individual contract covered thereby that
is made before the commencement of the case, except under
section 548(a)(1)(A) of this title, and except to the extent
the trustee could otherwise avoid such a transfer made
under an individual contract covered by such master net-
ting agreement.’’.
(f) FRAUDULENT TRANSFERS OF MASTER NETTING
AGREEMENTS.—Section 548(d)(2) of title 11, United States
Code, is amended—
(1) in subparagraph (C), by striking ‘‘and’’;
(2) in subparagraph (D), by striking the period
and inserting ‘‘; and’’; and
(3) by adding at the end the following new sub-
paragraph:
‘‘(E) a master netting agreement participant
that receives a transfer in connection with a master
netting agreement or any individual contract covered
thereby takes for value to the extent of such transfer,
except, with respect to a transfer under any indi-
vidual contract covered thereby, to the extent such
master netting agreement participant otherwise did
not take (or is otherwise not deemed to have taken)
such transfer for value.’’.
285
(g) TERMINATION OR ACCELERATION OF SECURITIES
CONTRACTS.—Section 555 of title 11, United States Code,
is amended—
(1) by amending the section heading to read as
follows:
‘‘§ 555. Contractual right to liquidate, terminate, or
accelerate a securities contract’’; and
(2) in the first sentence, by striking ‘‘liquida-
tion’’ and inserting ‘‘liquidation, termination, or ac-
celeration’’.
(h) TERMINATION
OR ACCELERATION
OF COMMOD-
ITIES OR FORWARD CONTRACTS.—Section 556 of title 11,
United States Code, is amended—
(1) by amending the section heading to read as
follows:
‘‘§ 556. Contractual right to liquidate, terminate, or
accelerate a commodities contract or for-
ward contract’’; and
(2) in the first sentence, by striking ‘‘liquida-
tion’’ and inserting ‘‘liquidation, termination, or ac-
celeration’’.
(i) TERMINATION OR ACCELERATION OF REPURCHASE
AGREEMENTS.—Section 559 of title 11, United States Code,
is amended—
286
(1) by amending the section heading to read as
follows:
‘‘§ 559. Contractual right to liquidate, terminate, or
accelerate a repurchase agreement’’; and
(2) in the first sentence, by striking ‘‘liquida-
tion’’ and inserting ‘‘liquidation, termination, or ac-
celeration’’.
(j) LIQUIDATION, TERMINATION, OR ACCELERATION OF
SWAP AGREEMENTS.—Section 560 of title 11, United States
Code, is amended—
(1) by amending the section heading to read as
follows:
‘‘§ 560. Contractual right to liquidate, terminate, or
accelerate a swap agreement’’; and
(2) in the first sentence, by striking ‘‘termi-
nation of a swap agreement’’ and inserting ‘‘liquida-
tion, termination, or acceleration of 1 or more swap
agreements’’; and
(3) by striking ‘‘in connection with any swap
agreement’’ and inserting ‘‘in connection with the ter-
mination, liquidation, or acceleration of 1 or more
swap agreements’’.
(k) LIQUIDATION, TERMINATION, ACCELERATION, OR
OFFSET UNDER
A MASTER NETTING AGREEMENT
AND
287
ACROSS CONTRACTS.—(1) Title 11, United States Code, is
amended by inserting after section 560 the following:
‘‘§ 561. Contractual right to terminate, liquidate, ac-
celerate, or offset under a master netting
agreement and across contracts
‘‘(a) IN GENERAL.—Subject to subsection (b), the exer-
cise of any contractual right, because of a condition of the
kind specified in section 365(e)(1), to cause the termination,
liquidation, or acceleration of or to offset or net termination
values, payment amounts or other transfer obligations aris-
ing under or in connection with 1 or more (or the termi-
nation, liquidation, or acceleration of 1 or more)—
‘‘(1) securities contracts, as defined in section
741(7);
‘‘(2) commodity contracts, as defined in section
761(4);
‘‘(3) forward contracts;
‘‘(4) repurchase agreements;
‘‘(5) swap agreements; or
‘‘(6) master netting agreements,
shall not be stayed, avoided, or otherwise limited by oper-
ation of any provision of this title or by any order of a
court or administrative agency in any proceeding under
this title.
‘‘(b) EXCEPTION.—
288
‘‘(1) A party may exercise a contractual right
described in subsection (a) to terminate, liquidate, or
accelerate only to the extent that such party could ex-
ercise such a right under section 555, 556, 559, or
560 for each individual contract covered by the mas-
ter netting agreement in issue.
‘‘(2) If a debtor is a commodity broker subject to
subchapter IV of chapter 7 of this title—
‘‘(A) a party may not net or offset an obli-
gation to the debtor arising under, or in connec-
tion with, a commodity contract against any
claim arising under, or in connection with, other
instruments, contracts, or agreements listed in
subsection (a) except to the extent the party has
positive net equity in the commodity accounts at
the debtor, as calculated under subchapter IV;
and
‘‘(B) another commodity broker may not net
or offset an obligation to the debtor arising
under, or in connection with, a commodity con-
tract entered into or held on behalf of a customer
of the debtor against any claim arising under, or
in connection with, other instruments, contracts,
or agreements listed in subsection (a).
289
‘‘(c) DEFINITION.—As used in this section, the term
‘contractual right’ includes a right set forth in a rule or
bylaw of a national securities exchange, a national securi-
ties association, or a securities clearing agency, a right set
forth in a bylaw of a clearing organization or contract mar-
ket or in a resolution of the governing board thereof, and
a right, whether or not evidenced in writing, arising under
common law, under law merchant, or by reason of normal
business practice.’’.
(2) CONFORMING AMENDMENT.—The table of sections
of chapter 9 of title 11, United States Code, is amended
by inserting after the item relating to section 560 the fol-
lowing:
‘‘561. Contractual right to terminate, liquidate, accelerate, or offset under a mas-
ter netting agreement and across contracts.
(l) ANCILLARY PROCEEDINGS.—Section 304 of title 11,
United States Code, as amended by section 215, is amended
by adding at the end the following:
‘‘(c) Any provisions of this title relating to securities
contracts, commodity contracts, forward contracts, repur-
chase agreements, swap agreements, or master netting
agreements shall apply in a case ancillary to a foreign pro-
ceeding under this section or any other section of this title,
so that enforcement of contractual provisions of such con-
tracts and agreements in accordance with their terms will
not be stayed or otherwise limited by operation of any pro-
290
vision of this title or by order of a court in any case under
this title, and to limit avoidance powers to the same extent
as in a proceeding under chapter 7 or 11 of this title (such
enforcement not to be limited based on the presence or ab-
sence of assets of the debtor in the United States).’’.
(m) COMMODITY BROKER LIQUIDATIONS.—Title 11,
United States Code, is amended by inserting after section
766 the following:
‘‘§ 767. Commodity broker liquidation and forward
contract merchants, commodity brokers,
stockbrokers, financial institutions, secu-
rities clearing agencies, swap partici-
pants, repo participants, and master net-
ting agreement participants
‘‘Notwithstanding any other provision of this title, the
exercise of rights by a forward contract merchant, com-
modity broker, stockbroker, financial institution, securities
clearing agency, swap participant, repo participant, or
master netting agreement participant under this title shall
not affect the priority of any unsecured claim it may have
after the exercise of such rights.’’.
(n) STOCKBROKER LIQUIDATIONS.—Title 11, United
States Code, is amended by inserting after section 752 the
following:
291
‘‘§ 753. Stockbroker liquidation and forward contract
merchants, 
commodity 
brokers, 
stock-
brokers, financial institutions, securities
clearing agencies, swap participants, repo
participants, and master netting agree-
ment participants
‘‘Notwithstanding any other provision of this title, the
exercise of rights by a forward contract merchant, com-
modity broker, stockbroker, financial institution, securities
clearing agency, swap participant, repo participant, finan-
cial participant, or master netting agreement participant
under this title shall not affect the priority of any unsecured
claim it may have after the exercise of such rights.’’.
(o) SETOFF.—Section 553 of title 11, United States
Code, is amended—
(1) in subsection (a)(3)(C), by inserting ‘‘(except
for a setoff of a kind described in section 362(b)(6),
362(b)(7), 362(b)(17), 362(b)(19), 555, 556, 559, 560
or 561 of this title)’’ before the period; and
(2) 
in 
subsection 
(b)(1), 
by 
striking
‘‘362(b)(14),’’ and inserting ‘‘362(b)(17), 362(b)(19),
555, 556, 559, 560, 561’’.
(p) SECURITIES CONTRACTS, COMMODITY CONTRACTS,
AND FORWARD CONTRACTS.—Title 11, United States Code,
is amended—
292
(1) in section 362(b)(6), by striking ‘‘financial
institutions,’’ each place such term appears and in-
serting ‘‘financial institution, financial participant’’;
(2) in section 546(e), by inserting ‘‘financial
participant,’’ after ‘‘financial institution,’’;
(3) in section 548(d)(2)(B), by inserting ‘‘finan-
cial participant,’’ after ‘‘financial institution,’’;
(4) in section 555—
(A) by inserting ‘‘financial participant,’’
after ‘‘financial institution,’’; and
(B) by inserting before the period at the end
‘‘, a right set forth in a bylaw of a clearing orga-
nization or contract market or in a resolution of
the governing board thereof, and a right, whether
or not in writing, arising under common law,
under law merchant, or by reason of normal
business practice’’; and
(5) in section 556, by inserting ‘‘, financial par-
ticipant’’ after ‘‘commodity broker’’.
(q) CONFORMING
AMENDMENTS.—Title 11 of the
United States Code is amended—
(1) in the table of sections of chapter 5—
(A) by amending the items relating to sec-
tions 555 and 556 to read as follows:
‘‘555. Contractual right to liquidate, terminate, or accelerate a securities contract.
‘‘556. Contractual right to liquidate, terminate, or accelerate a commodities con-
tract or forward contract.’’; and
293
(B) by amending the items relating to sec-
tions 559 and 560 to read as follows:
‘‘559. Contractual right to liquidate, terminate, or accelerate a repurchase agree-
ment.
‘‘560. Contractual right to liquidate, terminate, or accelerate a swap agreement.’’;
and
(2) in the table of sections of chapter 7—
(A) by inserting after the item relating to
section 766 the following:
‘‘767. Commodity broker liquidation and forward contract merchants, commodity
brokers, stockbrokers, financial institutions, securities clearing
agencies, swap participants, repo participants, and master net-
ting agreement participants.’’; and
(B) by inserting after the item relating to
section 752 the following:
‘‘753. Stockbroker liquidation and forward contract merchants, commodity bro-
kers, stockbrokers, financial institutions, securities clearing agen-
cies, swap participants, repo participants, and master netting
agreement participants.’’.
SEC. 1008. RECORDKEEPING REQUIREMENTS.
Section 11(e)(8) of the Federal Deposit Insurance Act
(12 U.S.C. 1821(e)(8)) is amended by adding at the end
the following new subparagraph:
‘‘(H) RECORDKEEPING
REQUIREMENTS.—
The Corporation, in consultation with the appro-
priate Federal banking agencies, may prescribe
regulations requiring more detailed record-
keeping with respect to qualified financial con-
tracts (including market valuations) by insured
depository institutions.’’.
294
SEC. 1009. EXEMPTIONS FROM CONTEMPORANEOUS EXECU-
TION –––REQUIREMENT.
Section 13(e)(2) of the Federal Deposit Insurance Act
(12 U.S.C. 1823(e)(2)) is amended to read as follows:
‘‘(2) EXEMPTIONS
FROM
CONTEMPORANEOUS
EXECUTION REQUIREMENT.—An agreement to provide
for the lawful collateralization of—
‘‘(A) deposits of, or other credit extension
by, a Federal, State, or local governmental enti-
ty, or of any depositor referred to in section
11(a)(2), including an agreement to provide col-
lateral in lieu of a surety bond;
‘‘(B) bankruptcy estate funds pursuant to
section 345(b)(2) of title 11, United States Code;
‘‘(C) extensions of credit, including any
overdraft, from a Federal reserve bank or Federal
home loan bank; or
‘‘(D) 1 or more qualified financial con-
tracts, as defined in section 11(e)(8)(D),
shall not be deemed invalid pursuant to paragraph
(1)(B) solely because such agreement was not executed
contemporaneously with the acquisition of the collat-
eral or because of pledges, delivery, or substitution of
the collateral made in accordance with such agree-
ment.’’.
295
SEC. 1010. DAMAGE MEASURE.
(a) Title 11, United States Code, as amended by sec-
tion 1007, is amended—
(1) by inserting after section 561 the following:
‘‘§ 562. Damage measure in connection with swap
agreements, securities contracts, forward
contracts, commodity contracts, repur-
chase 
agreements, 
or 
master 
netting
agreements
‘‘If the trustee rejects a swap agreement, securities con-
tract as defined in section 741 of this title, forward con-
tract, commodity contract (as defined in section 761 of this
title) repurchase agreement, or master netting agreement
pursuant to section 365(a) of this title, or if a forward con-
tract merchant, stockbroker, financial institution, securities
clearing agency, repo participant, financial participant,
master netting agreement participant, or swap participant
liquidates, terminates, or accelerates such contract or agree-
ment, damages shall be measured as of the earlier of—
‘‘(1) the date of such rejection; or
‘‘(2) the date of such liquidation, termination, or
acceleration.’’; and
(2) in the table of sections of chapter 5 by insert-
ing after the item relating to section 561 the fol-
lowing:
296
‘‘562. Damage measure in connection with swap agreements, securities contracts,
forward contracts, commodity contracts, repurchase agreements,
or master netting agreements.’’.
(b) CLAIMS
ARISING
FROM
REJECTION.—Section
502(g) of title 11, United States Code, is amended—
(1) by designating the existing text as paragraph
(1); and
(2) by adding at the end the following:
‘‘(2) A claim for damages calculated in accordance
with section 561 of this title shall be allowed under sub-
section (a), (b), or (c), or disallowed under subsection (d)
or (e), as if such claim had arisen before the date of the
filing of the petition.’’.
SEC. 1011. SIPC STAY.
Section 5(b)(2) of the Securities Investor Protection
Act of 1970 (15 U.S.C. 78eee(b)(2)) is amended by adding
after subparagraph (B) the following new subparagraph:
‘‘(C) EXCEPTION FROM STAY.—
‘‘(i) Notwithstanding section 362 of
title 11, United States Code, neither the fil-
ing of an application under subsection
(a)(3) nor any order or decree obtained by
Securities Investor Protection Corporation
from the court shall operate as a stay of
any contractual rights of a creditor to liq-
uidate, terminate, or accelerate a securities
contract, commodity contract, forward con-
297
tract, repurchase agreement, swap agree-
ment, or master netting agreement, each as
defined in title 11, to offset or net termi-
nation values, payment amounts, or other
transfer obligations arising under or in con-
nection with 1 or more of such contracts or
agreements, or to foreclose on any cash col-
lateral pledged by the debtor whether or not
with respect to 1 or more of such contracts
or agreements.
‘‘(ii) Notwithstanding clause (i), such
application, order, or decree may operate as
a stay of the foreclosure on securities collat-
eral pledged by the debtor, whether or not
with respect to 1 or more of such contracts
or agreements, securities sold by the debtor
under a repurchase agreement or securities
lent under a securities lending agreement.
‘‘(iii) As used in this section, the term
‘contractual right’ includes a right set forth
in a rule or bylaw of a national securities
exchange, a national securities association,
or a securities clearing agency, a right set
forth in a bylaw of a clearing organization
or contract market or in a resolution of the
298
governing board thereof, and a right, wheth-
er or not in writing, arising under common
law, under law merchant, or by reason of
normal business practice.’’.
SEC. 1012. ASSET-BACKED SECURITIZATIONS.
Section 541 of title 11, United States Code, as amend-
ed by section 150, is amended—
(1) by redesignating paragraph (5) of subsection
(b) as paragraph (6);
(2) by inserting after paragraph (4) of sub-
section (b) the following new paragraph:
‘‘(5) any eligible asset (or proceeds thereof), to
the extent that such eligible asset was transferred by
the debtor, before the date of commencement of the
case, to an eligible entity in connection with an asset-
backed securitization, except to the extent such asset
(or proceeds or value thereof) may be recovered by the
trustee under section 550 by virtue of avoidance
under section 548(a);’’; and
(3) by adding at the end the following new sub-
section:
‘‘(e) For purposes of this section, the following defini-
tions shall apply:
‘‘(1) the term ‘asset-backed securitization’ means
a transaction in which eligible assets transferred to
299
an eligible entity are used as the source of payment
on securities, the most senior of which are rated in-
vestment grade by 1 or more nationally recognized se-
curities rating organizations, issued by an issuer;
‘‘(2) the term ‘eligible asset’ means—
‘‘(A) financial assets (including interests
therein and proceeds thereof), either fixed or re-
volving, including residential and commercial
mortgage loans, consumer receivables, trade re-
ceivables, and lease receivables, that, by their
terms, convert into cash within a finite time pe-
riod, plus any residual interest in property sub-
ject to receivables included in such financial as-
sets plus any rights or other assets designed to
assure the servicing or timely distribution of
proceeds to security holders;
‘‘(B) cash; and
‘‘(C) securities.
‘‘(3) the term ‘eligible entity’ means—
‘‘(A) an issuer; or
‘‘(B) a trust, corporation, partnership, or
other entity engaged exclusively in the business
of acquiring and transferring eligible assets di-
rectly or indirectly to an issuer and taking ac-
tions ancillary thereto;
300
‘‘(4) the term ‘issuer’ means a trust, corporation,
partnership, or other entity engaged exclusively in the
business of acquiring and holding eligible assets,
issuing securities backed by eligible assets, and taking
actions ancillary thereto; and
‘‘(5) the term ‘transferred’ means the debtor, pur-
suant to a written agreement, represented and war-
ranted that eligible assets were sold, contributed, or
otherwise conveyed with the intention of removing
them from the estate of the debtor pursuant to sub-
section (b)(5), irrespective, without limitation of—
‘‘(A) whether the debtor directly or indi-
rectly obtained or held an interest in the issuer
or in any securities issued by the issuer;
‘‘(B) whether the debtor had an obligation
to repurchase or to service or supervise the serv-
icing of all or any portion of such eligible assets;
or
‘‘(C) the characterization of such sale, con-
tribution, or other conveyance for tax, account-
ing, regulatory reporting, or other purposes.’’.
SEC. 1013. FEDERAL RESERVE COLLATERAL REQUIRE-
MENTS.
The 3d sentence of the 3d undesignated paragraph of
section 16 of the Federal Reserve Act (12 U.S.C. 412) is
301
amended by striking ‘‘acceptances acquired under the provi-
sions of section 13 of this Act’’ and inserting ‘‘acceptances
acquired under section 10A, 10B, 13, or 13A of this Act’’.
SEC. 1014. EFFECTIVE DATE; APPLICATION OF –––AMEND-
MENTS.
(a) EFFECTIVE DATE.—This title shall take effect on
the date of the enactment of this Act.
(b) APPLICATION OF AMENDMENTS.—The amendments
made by this title shall apply with respect to cases com-
menced or appointments made under any Federal or State
law after the date of enactment of this Act, but shall not
apply with respect to cases commenced or appointments
made under any Federal or State law before the date of
enactment of this Act.
TITLE XI—TECHNICAL
CORRECTIONS
SEC. 1101. DEFINITIONS.
Section 101 of title 11, United States Code, as amend-
ed by sections 102, 105, 132, 138, 301, 302, 402, 902, and
1007, is amended—
(1) by striking ‘‘In this title—’’ and inserting
‘‘In this title:’’;
(2) in each paragraph, by inserting ‘‘The term’’
after the paragraph designation;
302
(3) in paragraph (35)(B), by striking ‘‘para-
graphs (21B) and (33)(A)’’ and inserting ‘‘para-
graphs (23) and (35)’’;
(4) in each of paragraphs (35A) and (38), by
striking ‘‘; and’’ at the end and inserting a period;
(5) in paragraph (51B)—
(A) by inserting ‘‘who is not a family farm-
er’’ after ‘‘debtor’’ the first place it appears; and
(B) by striking ‘‘thereto having aggregate’’
and all that follows through the end of the para-
graph;
(6) by amending paragraph (54) to read as fol-
lows:
‘‘(54) The term ‘transfer’ means—
‘‘(A) the creation of a lien;
‘‘(B) the retention of title as a security in-
terest;
‘‘(C) the foreclosure of a debtor’s equity of
redemption; or
‘‘(D) each mode, direct or indirect, absolute
or conditional, voluntary or involuntary, of dis-
posing of or parting with—
‘‘(i) property; or
‘‘(ii) an interest in property;’’;
303
(7) in each of paragraphs (1) through (35), in
each of paragraphs (36) and (37), and in each of
paragraphs (40) through (55) (including paragraph
(54), as amended by paragraph (6) of this section),
by striking the semicolon at the end and inserting a
period; and
(8) by redesignating paragraphs (4) through
(55), including paragraph (54), as amended by para-
graph (6) of this section, in entirely numerical se-
quence.
SEC. 1102. ADJUSTMENT OF DOLLAR AMOUNTS.
Section 104 of title 11, United States Code, is amended
by inserting ‘‘522(f)(3), 707(b)(5),’’ after ‘‘522(d),’’ each
place it appears.
SEC. 1103. EXTENSION OF TIME.
Section 108(c)(2) of title 11, United States Code, is
amended by striking ‘‘922’’ and all that follows through
‘‘or’’, and inserting ‘‘922, 1201, or’’.
SEC. 1104. TECHNICAL AMENDMENTS.
Title 11 of the United States Code is amended—
(1) in section 109(b)(2) by striking ‘‘subsection
(c) or (d) of’’; and
(2) in section 552(b)(1) by striking ‘‘product’’
each place it appears and inserting ‘‘products’’.
304
SEC. 1105. PENALTY FOR PERSONS WHO NEGLIGENTLY OR
FRAUDULENTLY PREPARE BANKRUPTCY PE-
TITIONS.
Section 110(j)(3) of title 11, United States Code, is
amended 
by 
striking 
‘‘attorney’s’’ 
and 
inserting
‘‘attorneys’ ’’.
SEC. 1106. LIMITATION ON COMPENSATION OF PROFES-
SIONAL PERSONS.
Section 328(a) of title 11, United States Code, is
amended by inserting ‘‘on a fixed or percentage fee basis,’’
after ‘‘hourly basis,’’.
SEC. 1107. SPECIAL TAX PROVISIONS.
Section 346(g)(1)(C) of title 11, United States Code,
is amended by striking ‘‘, except’’ and all that follows
through ‘‘1986’’.
SEC. 1108. EFFECT OF CONVERSION.
Section 348(f)(2) of title 11, United States Code, is
amended by inserting ‘‘of the estate’’ after ‘‘property’’ the
first place it appears.
SEC. 1109. ALLOWANCE OF ADMINISTRATIVE EXPENSES.
Section 503(b)(4) of title 11, United States Code, is
amended by inserting ‘‘subparagraph (A), (B), (C), (D), or
(E) of’’ before ‘‘paragraph (3)’’.
SEC. 1110. PRIORITIES.
Section 507(a) of title 11, United States Code, as
amended by section 323, is amended in paragraph (4), as
305
so redesignated by section 142, by striking the semicolon
at the end and inserting a period.
SEC. 1111. EXEMPTIONS.
Section 522(g)(2) of title 11, United States Code, is
amended by striking ‘‘subsection (f)(2)’’ and inserting ‘‘sub-
section (f)(1)(B)’’.
SEC. 1112. EXCEPTIONS TO DISCHARGE.
Section 523 of title 11, United States Code, as amend-
ed by section 146, is amended—
(1) in subsection (a)(3), by striking ‘‘or (6)’’
each place it appears and inserting ‘‘(6), or (15)’’;
(2) as amended by section 304(e) of Public Law
103–394 (108 Stat. 4133), in paragraph (15), by
transferring such paragraph so as to insert it after
paragraph (14A) of subsection (a);
(3) 
in 
subsection 
(a)(9), 
by 
inserting
‘‘, watercraft, or aircraft’’ after ‘‘motor vehicle’’;
(4) in subsection (a)(15), as so redesignated by
paragraph (2) of this subsection, by inserting ‘‘to a
spouse, former spouse, or child of the debtor and’’
after ‘‘(15)’’; and
(5) in subsection (e), by striking ‘‘a insured’’
and inserting ‘‘an insured’’.
306
SEC. 1113. EFFECT OF DISCHARGE.
Section 524(a)(3) of title 11, United States Code, is
amended by striking ‘‘section 523’’ and all that follows
through ‘‘or that’’ and inserting ‘‘section 523, 1228(a)(1),
or 1328(a)(1) of this title, or that’’.
SEC. 1114. PROTECTION AGAINST DISCRIMINATORY TREAT-
MENT.
Section 525(c) of title 11, United States Code, is
amended—
(1) in paragraph (1), by inserting ‘‘student’’ be-
fore ‘‘grant’’ the second place it appears; and
(2) in paragraph (2), by striking ‘‘the program
operated under part B, D, or E of’’ and inserting
‘‘any program operated under’’.
SEC. 1115. PROPERTY OF THE ESTATE.
Section 541(b)(4)(B)(ii) of title 11, United States
Code, is amended by inserting ‘‘365 or’’ before ‘‘542’’.
SEC. 1116. PREFERENCES.
(a) IN GENERAL.—Section 547 of title 11, United
States Code, is amended—
(1) in subsection (b), by striking ‘‘subsection (c)’’
and inserting ‘‘subsections (c) and (i)’’; and
(2) by adding at the end the following:
‘‘(i) If the trustee avoids under subsection (b) a trans-
fer made between 90 days and 1 year before the date of
the filing of the petition, by the debtor to an entity that
307
is not an insider for the benefit of a creditor that is an
insider, such transfer may be avoided under this section
only with respect to the creditor that is an insider.’’.
(b) APPLICABILITY.—The amendments made by this
section shall apply to any case that is pending or com-
menced on or after the date of enactment of this Act.
SEC. 1117. POSTPETITION TRANSACTIONS.
Section 549(c) of title 11, United States Code, is
amended—
(1) by inserting ‘‘an interest in’’ after ‘‘transfer
of’’;
(2) by striking ‘‘such property’’ and inserting
‘‘such real property’’; and
(3) by striking ‘‘the interest’’ and inserting
‘‘such interest’’.
SEC. 1118. DISPOSITION OF PROPERTY OF THE ESTATE.
Section 726(b) of title 11, United States Code, is
amended by striking ‘‘1009,’’.
SEC. 1119. GENERAL PROVISIONS.
Section 901(a) of title 11, United States Code, is
amended by inserting ‘‘1123(d),’’ after ‘‘1123(b),’’.
SEC. 1120. APPOINTMENT OF ELECTED TRUSTEE.
Section 1104(b) of title 11, United States Code, is
amended—
(1) by inserting ‘‘(1)’’ after ‘‘(b)’’; and
308
(2) by adding at the end the following:
‘‘(2)(A) If an eligible, disinterested trustee is elected
at a meeting of creditors under paragraph (1), the United
States trustee shall file a report certifying that election.
Upon the filing of a report under the preceding sentence—
‘‘(i) the trustee elected under paragraph (1) shall
be considered to have been selected and appointed for
purposes of this section; and
‘‘(ii) the service of any trustee appointed under
subsection (d) shall terminate.
‘‘(B) In the case of any dispute arising out of an elec-
tion under subparagraph (A), the court shall resolve the dis-
pute.’’.
SEC. 1121. ABANDONMENT OF RAILROAD LINE.
Section 1170(e)(1) of title 11, United States Code, is
amended by striking ‘‘section 11347’’ and inserting ‘‘section
11326(a)’’.
SEC. 1122. CONTENTS OF PLAN.
Section 1172(c)(1) of title 11, United States Code, is
amended by striking ‘‘section 11347’’ and inserting ‘‘section
11326(a)’’.
SEC. 1123. DISCHARGE UNDER CHAPTER 12.
Subsections (a) and (c) of section 1228 of title 11,
United States Code, are amended by striking ‘‘1222(b)(10)’’
each place it appears and inserting ‘‘1222(b)(9)’’.
309
SEC. 1124. BANKRUPTCY CASES AND PROCEEDINGS.
Section 1334(d) of title 28, United States Code, is
amended—
(1) by striking ‘‘made under this subsection’’ and
inserting ‘‘made under subsection (c)’’; and
(2) by striking ‘‘This subsection’’ and inserting
‘‘Subsection (c) and this subsection’’.
SEC. 1125. KNOWING DISREGARD OF BANKRUPTCY LAW OR
RULE.
Section 156(a) of title 18, United States Code, is
amended—
(1) in the first undesignated paragraph—
(A) by inserting ‘‘(1) the term’’ before
‘‘ ‘bankruptcy’’; and
(B) by striking the period at the end and
inserting ‘‘; and’’; and
(2) in the second undesignated paragraph—
(A) by inserting ‘‘(2) the term’’ before ‘‘ ‘doc-
ument’’; and
(B) by striking ‘‘this title’’ and inserting
‘‘title 11’’.
SEC. 1126. TRANSFERS MADE BY NONPROFIT CHARITABLE
CORPORATIONS.
(a) SALE OF PROPERTY OF ESTATE.—Section 363(d)
of title 11, United States Code, is amended—
310
(1) by striking ‘‘only’’ and all that follows
through the end of the subsection and inserting
‘‘only—
‘‘(1) in accordance with applicable nonbank-
ruptcy law that governs the transfer of property by
a corporation or trust that is not a moneyed, busi-
ness, or commercial corporation or trust; and
‘‘(2) to the extent not inconsistent with any relief
granted under subsection (c), (d), (e), or (f) of section
362 of this title.’’.
(b) CONFIRMATION OF PLAN FOR REORGANIZATION.—
Section 1129(a) of title 11, United States Code, as amended
by section 140, is amended by adding at the end the fol-
lowing:
‘‘(15) All transfers of property of the plan shall
be made in accordance with any applicable provisions
of nonbankruptcy law that govern the transfer of
property by a corporation or trust that is not a
moneyed, business, or commercial corporation or
trust.’’.
(c) TRANSFER OF PROPERTY.—Section 541 of title 11,
United States Code, as amended by section 1102, is amend-
ed by adding at the end the following:
‘‘(f) Notwithstanding any other provision of this title,
property that is held by a debtor that is a corporation de-
311
scribed in section 501(c)(3) of the Internal Revenue Code
of 1986 and exempt from tax under section 501(a) of such
Code may be transferred to an entity that is not such a
corporation, but only under the same conditions as would
apply if the debtor had not filed a case under this title.’’.
(d) APPLICABILITY.—The amendments made by this
section shall apply to a case pending under title 11, United
States Code, on the date of enactment of this Act, except
that the court shall not confirm a plan under chapter 11
of this title without considering whether this section would
substantially affect the rights of a party in interest who
first acquired rights with respect to the debtor after the date
of the petition. The parties who may appear and be heard
in a proceeding under this section include the attorney gen-
eral of the State in which the debtor is incorporated, was
formed, or does business.
(e) RULE OF CONSTRUCTION.—Nothing in this section
shall be deemed to require the court in which a case under
chapter 11 is pending to remand or refer any proceeding,
issue, or controversy to any other court or to require the
approval of any other court for the transfer of property.
SEC. 1127. PROHIBITION ON CERTAIN ACTIONS FOR FAIL-
URE TO INCUR FINANCE CHARGES.
Section 127 of the Truth in Lending Act (15 U.S.C.
1637) is amended by adding at the end the following:
312
‘‘(i) PROHIBITION ON CERTAIN ACTIONS FOR FAILURE
TO INCUR FINANCE CHARGES.—A creditor of an account
under an open end consumer credit plan may not terminate
an account prior to its expiration date solely because the
consumer has not incurred finance charges on the account.
Nothing in this subsection shall prohibit a creditor from
terminating an account for inactivity in 3 or more consecu-
tive months.’’.
SEC. 1128. PROTECTION OF VALID PURCHASE MONEY SECU-
RITY INTERESTS.
Section 547(c)(3)(B) of title 11, United States Code,
is amended by striking ‘‘20’’ and inserting ‘‘30’’.
SEC. 1129. TRUSTEES.
(a) SUSPENSION AND TERMINATION OF PANEL TRUST-
EES AND STANDING TRUSTEES.—Section 586(d) of title 28,
United States Code, is amended—
(1) by inserting ‘‘(1)’’ after ‘‘(d)’’; and
(2) by adding at the end the following:
‘‘(2) A trustee whose appointment under subsection
(a)(1) or under subsection (b) is terminated or who ceases
to be assigned to cases filed under title 11 of the United
States Code may obtain judicial review of the final agency
decision by commencing an action in the United States dis-
trict court for the district for which the panel to which the
trustee is appointed under subsection (a)(1), or in the
313
United States district court for the district in which the
trustee is appointed under subsection (b) resides, after first
exhausting all available administrative remedies, which if
the trustee so elects, shall also include an administrative
hearing on the record. Unless the trustee elects to have an
administrative hearing on the record, the trustee shall be
deemed to have exhausted all administrative remedies for
purposes of this paragraph if the agency fails to make a
final agency decision within 90 days after the trustee re-
quests administrative remedies. The Attorney General shall
prescribe procedures to implement this paragraph. The de-
cision of the agency shall be affirmed by the district court
unless it is unreasonable and without cause based on the
administrative record before the agency.’’.
(b) EXPENSES
OF STANDING TRUSTEES.—Section
586(e) of title 28, United States Code, is amended by add-
ing at the end the following:
‘‘(3) After first exhausting all available administrative
remedies, an individual appointed under subsection (b)
may obtain judicial review of final agency action to deny
a claim of actual, necessary expenses under this subsection
by commencing an action in the United States district
court in the district where the individual resides. The deci-
sion of the agency shall be affirmed by the district court
314
unless it is unreasonable and without cause based upon the
administrative record before the agency.
‘‘(4) The Attorney General shall prescribe procedures
to implement this subsection.’’.
TITLE XII—GENERAL EFFECTIVE
DATE; 
APPLICATION 
OF
AMENDMENTS
SEC. 1201. EFFECTIVE DATE; APPLICATION OF AMEND-
MENTS.
(a) EFFECTIVE DATE.—Except as provided otherwise
in this Act, this Act and the amendments made by this Act
shall take effect 180 days after the date of the enactment
of this Act.
(b) APPLICATION OF AMENDMENTS.—Except as other-
wise provided in this Act, the amendments made by this
Act shall not apply with respect to cases commenced under
title 11 of the United States Code before the effective date
of this Act.