PRRADA
Bill: H.R.1192 | Sponsor: Rep. Velazquez, Nydia M. (D-NY)
Policy area: Law

Summary:
Puerto Rico Recovery Accuracy in Disclosures Act of 2021 or PRRADA
This bill requires professionals employed in debt adjustment cases involving Puerto Rico to file verified statements disclosing their connections with interested parties before seeking compensation for their services.
The Financial Oversight and Management Board for Puerto Rico must establish a list of such interested parties, which shall include the debtor, creditors, any attorney or accountant of the debtor or creditors, persons employed by the U.S. Trustee Program, persons employed by the board, and any other interested party.
Compensation may be denied to such a professional if these disclosures are not filed, are inadequate, or if the professional is found to have certain conflicts of interest.

[117th Congress Public Law 82]
[From the U.S. Government Publishing Office]



[[Page 136 STAT. 3]]

Public Law 117-82
117th Congress

                                 An Act


 
 To impose requirements on the payment of compensation to professional 
  persons employed in voluntary cases commenced under title III of the 
 Puerto Rico Oversight Management and Economic Stability Act (commonly 
     known as ``PROMESA''). <<NOTE: Jan. 20, 2022 -  [H.R. 1192]>> 

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled, <<NOTE: Puerto Rico 
Recovery Accuracy in Disclosures Act of 2021. 48 USC 2101 note.>> 
SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Puerto Rico Recovery Accuracy in 
Disclosures Act of 2021'' or ``PRRADA''.
SEC. 2. <<NOTE: 48 USC 2178.>>  DISCLOSURE BY PROFESSIONAL PERSONS 
                    SEEKING APPROVAL OF COMPENSATION UNDER SECTION 
                    316 OR 317 OF PROMESA.

    (a) Definitions.--In this section:
            (1) List of material interested parties.--The term ``List of 
        Material Interested Parties'' means the List of Material 
        Interested Parties established under subsection (c)(1).
            (2) Oversight board.--The term ``Oversight Board'' has the 
        meaning given the term in section 5 of PROMESA (48 U.S.C. 2104).

    (b) <<NOTE: Courts.>>  Required Disclosure.--
            (1) In general.--In a case commenced under section 304 of 
        PROMESA (48 U.S.C. 2164), no attorney, accountant, appraiser, 
        auctioneer, agent, or other professional person may be 
        compensated under section 316 or 317 of that Act (48 U.S.C. 
        2176, 2177) unless prior to making a request for compensation, 
        the professional person has filed with the court a verified 
        statement conforming to the disclosure requirements of rule 
        2014(a) of the Federal Rules of Bankruptcy Procedure setting 
        forth the connection of the professional person with any entity 
        or person on the List of Material Interested Parties.
            (2) Supplement.--A professional person that submits a 
        statement under paragraph (1) shall promptly supplement the 
        statement with any additional relevant information that becomes 
        known to the person.
            (3) <<NOTE: Determination.>>  Disclosure.--Subject to any 
        other applicable law, rule, or regulation, a professional person 
        that fails to file or update a statement required under 
        paragraph (1) or files a statement that the court determines 
        does not represent a good faith effort to comply with this 
        section shall disclose such failure in any filing required to 
        conform to the disclosure requirements under rule 2014(a) of the 
        Federal Rules of Bankruptcy Procedure.

    (c) List of Material Interested Parties.--

[[Page 136 STAT. 4]]

            (1) <<NOTE: Deadline.>>  Preparation.--Not later than 30 
        days after the date of enactment of this Act, the Oversight 
        Board shall establish a List of Material Interested Parties 
        subject to--
                    (A) <<NOTE: Courts.>>  the approval of the court; 
                and
                    (B) the right of the United States trustee or any 
                party in interest to be heard on the approval.
            (2) Inclusions.--Except as provided in paragraph (3), the 
        List of Material Interested Parties shall include--
                    (A) the debtor;
                    (B) any creditor;
                    (C) any other party in interest;
                    (D) any attorney or accountant of--
                          (i) the debtor;
                          (ii) any creditor; or
                          (iii) any other party in interest;
                    (E) the United States trustee and any person 
                employed in the office of the United States trustee; and
                    (F) the Oversight Board, including the members, the 
                Executive Director, and the employees of the Oversight 
                Board.
            (3) Exclusions.--The List of Material Interested Parties may 
        not include any person with a claim, the amount of which is 
        below a threshold dollar amount established by the court that is 
        consistent with the purpose of this Act.

    (d) Review.--
            (1) In general.--The United States trustee shall review each 
        verified statement submitted pursuant to subsection (b) and may 
        file with the court comments on such verified statements before 
        the professionals filing such statements seek compensation under 
        section 316 or 317 of PROMESA (48 U.S.C. 2176, 2177).
            (2) Objection.--The United States trustee may object to 
        applications filed under section 316 or 317 of PROMESA (48 
        U.S.C. 2176, 2177) that fail to satisfy the requirements of 
        subsection (b).

    (e) <<NOTE: Courts.>>  Limitation on Compensation.--In a case 
commenced under section 304 of PROMESA (48 U.S.C. 2164), in connection 
with the review and approval of professional compensation under section 
316 or 317 of PROMESA (48 U.S.C. 2176, 2177) filed after the date of 
enactment of this Act, the court may deny allowance of compensation or 
reimbursement of expenses if--
            (1) the professional person has failed to file the verified 
        disclosure statements required under subsection (b)(1) or has 
        filed inadequate disclosure statements under that subsection; or
            (2) during the professional person's employment in 
        connection with the case, the professional person--
                    (A) is not a disinterested person (as defined in 
                section 101 of title 11, United States Code) relative to 
                any entity or person on the List of Material Interested 
                Parties; or

[[Page 136 STAT. 5]]

                    (B) represents or holds an adverse interest in 
                connection with the case.

    Approved January 20, 2022.

LEGISLATIVE HISTORY--H.R. 1192:
---------------------------------------------------------------------------

SENATE REPORTS: No. 117-48 (Comm. on Energy and Natural Resources).
CONGRESSIONAL RECORD:
                                                        Vol. 167 (2021):
                                    Feb. 23, 24, considered and passed 
                                        House.
                                    Dec. 17, considered and passed 
                                        Senate, amended.
                                                        Vol. 168 (2022):
                                    Jan. 19, House concurred in Senate 
                                        amendment.

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