Financial Netting Improvements Act of 2006

Bill: 109-hr-5585
Sponsor: Rep. McHenry, Patrick T. [R-NC-10]
Introduced: 2006-06-12 in the House
Policy area: Finance and Financial Sector
Subjects: Administrative fees
Bank failures
Bankruptcy
Collection of accounts
Compensation (Law)
Contracts
Credit unions
Economics and Public Finance
Futures trading
Law
Loan defaults
Securities
Securities regulation
Swaps (Finance)
Trusts and trustees

Summary:
action_date: 2006-06-12
text: 
Financial Netting Improvements Act of 2006 - Amends the Federal Deposit Insurance Act and the Federal Credit Union Act to revise treatment of certain agreements entered into before appointment of depository institution conservators or receivers, including securities contracts, forward contracts, swap agreements, and certain walkaway clauses.
 
Makes conforming amendments to: (1) the Federal Deposit Insurance Corporation Improvement Act of 1991; (2) federal bankruptcy law; and (3) the Securities Investor Protection Act of 1970.
 
Amends the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 to state that the meanings of terms used in the Act are applicable for its purposes only, and shall not be construed or applied so as to challenge or affect the characterization, definition, or treatment of any similar terms under any other statute, regulation, or rule, including the Gramm-Leach-Bliley Act, the Legal Certainty for Bank Products Act of 2000, the securities laws, and the Commodity Exchange Act.
 
Amends the Federal Deposit Insurance Act and the Federal Credit Union Act to repeal the declaration that no walkaway clause shall be enforceable in a qualified financial contract of an insured depository institution in default. Declares any payment or delivery obligation otherwise due from a party pursuant to a qualified financial contract suspended from the time a receiver is appointed until the earlier of: (1) the time a party receives notice that the contract has been transferred; or (2) 5 p.m. (eastern time) on the business day after the receiver's appointment.
 
Amends federal bankruptcy law and the judicial code to increase chapter 7 trustee compensation and filing fees.
 


action_date: 2006-09-27
text: 
Financial Netting Improvements Act of 2006 - (Sec. 2) Amends the Federal Deposit Insurance Act (FDIA) and the Federal Credit Union Act to revise treatment of certain agreements entered into before appointment of depository institution conservators or receivers, including securities contracts, forward contracts, and swap agreements.
 
(Sec. 3) Defines &quot;person&quot; to include any governmental entity.
 
(Sec. 4) Amends the Federal Deposit Insurance Corporation Improvement Act of 1991 (FDICIA) to revise certain requirements pertinent to bilateral netting to declare that the covered contractual payment obligations and the covered contractual payment entitlements between any two financial institutions shall be terminated, liquidated, accelerated, and netted in accordance with, and subject to the conditions of, the terms of any applicable netting contract.
 
Declares, with respect to clearing organization netting, that the covered contractual payment obligations and the covered contractual payment entitlements of a member of a clearing organization to and from all other organization members shall be terminated, liquidated, accelerated, and netted in accordance with and subject to the conditions of any applicable netting contract.
 
(Sec. 5) Makes conforming amendments to the FDICIA, federal bankruptcy law, and the Securities Investor Protection Act of 1970.
 
Amends the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 to state that the meanings of terms used in the Act are applicable for its purposes only, and shall not be construed or applied so as to challenge or affect the characterization, definition, or treatment of any similar terms under any other statute, regulation, or rule, including the Gramm-Leach-Bliley Act, the Legal Certainty for Bank Products Act of 2000, the securities laws, and the Commodity Exchange Act.
 
(Sec. 6) Amends the Federal Deposit Insurance Act and the Federal Credit Union Act to repeal the non-enforceability of a walkaway clause (thus making it enforceable) in a qualified financial contract of an insured depository institution in default. 
 
States that any payment or delivery obligation otherwise due from a party pursuant to a qualified financial contract is suspended from the time a receiver is appointed until the earlier of: (1) the time a party receives notice that the contract has been transferred; or (2) 5 p.m. (eastern time) on the business day after the receiver's appointment.
 
(Sec. 7) Amends federal bankruptcy law and the judicial code to increase chapter 7 (Liquidation) trustee compensation and filing fees.
 
Raises trustee compensation, paid from the filing fee in a case, from $45 to $100, adjusted by the amount (if any) of such filing fee waived for a low-income individual.
 
Increases the filing fee in a chapter 7 case from $245 to $300.
 
Requires the district court or the bankruptcy court to waive $40 of the filing fee in a chapter 7 case for an individual with an income between 150% and 175% of the income official poverty line applicable to a family of the size involved.
 
Revises the formula for determining the deposit amount of offsetting collections to the U.S. Trustee System Fund appropriation from 40.46% of collected chapter 7 filing fees to 29.87% of such fees plus the total amount of waived $40 portions of the filing fee for low-income individuals.
 
Revises the formula for determining the deposit amount of offsetting collections to the Fund appropriation with respect to certain fees under the bankruptcy miscellaneous fee schedule. Changes the portion of the formula pertinent to collected chapter 7 filing fees from 28.87% of such fees to 21.17% of them plus the total amount of waived $40 portions of the filing fee for low-income individuals.

action_date: 2006-09-30
text: 
Financial Netting Improvements Act of 2006 - (Sec. 2) Amends the Federal Deposit Insurance Act (FDIA) and the Federal Credit Union Act to revise treatment of certain agreements entered into before appointment of depository institution conservators or receivers, including securities contracts, forward contracts, and swap agreements.
 
(Sec. 3) Defines &quot;person&quot; to include any governmental entity.
 
(Sec. 4) Amends the Federal Deposit Insurance Corporation Improvement Act of 1991 (FDICIA) to revise certain requirements pertinent to bilateral netting to declare that the covered contractual payment obligations and the covered contractual payment entitlements between any two financial institutions shall be terminated, liquidated, accelerated, and netted in accordance with, and subject to the conditions of, the terms of any applicable netting contract.
 
Declares, with respect to clearing organization netting, that the covered contractual payment obligations and the covered contractual payment entitlements of a member of a clearing organization to and from all other organization members shall be terminated, liquidated, accelerated, and netted in accordance with and subject to the conditions of any applicable netting contract.
 
(Sec. 5) Makes conforming amendments to the FDICIA, federal bankruptcy law, and the Securities Investor Protection Act of 1970.
 
Amends the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 to state that the meanings of terms used in the Act are applicable for its purposes only, and shall not be construed or applied so as to challenge or affect the characterization, definition, or treatment of any similar terms under any other statute, regulation, or rule, including the Gramm-Leach-Bliley Act, the Legal Certainty for Bank Products Act of 2000, the securities laws, and the Commodity Exchange Act.
 
(Sec. 6) Amends the Federal Deposit Insurance Act and the Federal Credit Union Act to repeal the non-enforceability of a walkaway clause (thus making it enforceable) in a qualified financial contract of an insured depository institution in default. 
 
States that any payment or delivery obligation otherwise due from a party pursuant to a qualified financial contract is suspended from the time a receiver is appointed until the earlier of: (1) the time a party receives notice that the contract has been transferred; or (2) 5 p.m. (eastern time) on the business day after the receiver's appointment.
 

 

 

 

 

 


action_date: 2006-12-12
text: 

(This measure has not been amended since it was passed by the Senate on September 30, 2006. The summary of that version is repeated here.)

 
Financial Netting Improvements Act of 2006 - (Sec. 2) Amends the Federal Deposit Insurance Act (FDIA) and the Federal Credit Union Act to revise treatment of certain agreements entered into before appointment of depository institution conservators or receivers, including securities contracts, forward contracts, and swap agreements.
 
(Sec. 3) Defines &quot;person&quot; to include any governmental entity.
 
(Sec. 4) Amends the Federal Deposit Insurance Corporation Improvement Act of 1991 (FDICIA) to revise certain requirements pertinent to bilateral netting to declare that the covered contractual payment obligations and the covered contractual payment entitlements between any two financial institutions shall be terminated, liquidated, accelerated, and netted in accordance with, and subject to the conditions of, the terms of any applicable netting contract.
 
Declares, with respect to clearing organization netting, that the covered contractual payment obligations and the covered contractual payment entitlements of a member of a clearing organization to and from all other organization members shall be terminated, liquidated, accelerated, and netted in accordance with and subject to the conditions of any applicable netting contract.
 
(Sec. 5) Makes conforming amendments to the FDICIA, federal bankruptcy law, and the Securities Investor Protection Act of 1970.
 
Amends the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 to state that the meanings of terms used in the Act are applicable for its purposes only, and shall not be construed or applied so as to challenge or affect the characterization, definition, or treatment of any similar terms under any other statute, regulation, or rule, including the Gramm-Leach-Bliley Act, the Legal Certainty for Bank Products Act of 2000, the securities laws, and the Commodity Exchange Act.
 
(Sec. 6) Amends the Federal Deposit Insurance Act and the Federal Credit Union Act to repeal the non-enforceability of a walkaway clause (thus making it enforceable) in a qualified financial contract of an insured depository institution in default. 
 
States that any payment or delivery obligation otherwise due from a party pursuant to a qualified financial contract is suspended from the time a receiver is appointed until the earlier of: (1) the time a party receives notice that the contract has been transferred; or (2) 5 p.m. (eastern time) on the business day after the receiver's appointment.


Legislative actions:
action_date: 2006-12-12
text: Became Public Law No: 109-390.
action_date: 2006-12-12
text: Became Public Law No: 109-390.
action_date: 2006-12-12
text: Signed by President.
action_date: 2006-12-12
text: Signed by President.
action_date: 2006-12-04
text: Presented to President.
action_date: 2006-12-04
text: Presented to President.
action_date: 2006-11-15
text: Motion to reconsider laid on the table Agreed to without objection.
action_date: 2006-11-15
text: On motion that the House suspend the rules and agree to the Senate amendments Agreed to by the Yeas and Nays: (2/3 required): 395 - 0 (Roll no. 522). (text as House agreed to Senate amendment: CR H8650)
action_date: 2006-11-15
text: Resolving differences -- House actions: On motion that the House suspend the rules and agree to the Senate amendments Agreed to by the Yeas and Nays: (2/3 required): 395 - 0 (Roll no. 522).(text as House agreed to Senate amendment: CR H8650)
action_date: 2006-11-15
text: Considered as unfinished business. (consideration: CR H8654-8655)
action_date: 2006-11-15
text: At the conclusion of debate, the Yeas and Nays were demanded and ordered. Pursuant to the provisions of clause 5, rule I, the chair announced that further proceedings on the motion would be postponed.
action_date: 2006-11-15
text: DEBATE - The House proceeded with forty minutes of debate on the motion to suspend the rules and agree to the Senate amendments to H.R. 5585.
action_date: 2006-11-15
text: Mr. McHenry moved that the House suspend the rules and agree to the Senate amendments. (consideration: CR H8650-8651)
action_date: 2006-09-30
text: Message on Senate action sent to the House.
action_date: 2006-09-30
text: Passed Senate with amendments by Unanimous Consent.
action_date: 2006-09-30
text: Passed/agreed to in Senate: Passed Senate with amendments by Unanimous Consent.
action_date: 2006-09-30
text: Measure laid before Senate by unanimous consent. (consideration: CR 9/29/2006 S10769)
action_date: 2006-09-28
text: Received in the Senate, read twice.
action_date: 2006-09-27
text: Motion to reconsider laid on the table Agreed to without objection.
action_date: 2006-09-27
text: On motion to suspend the rules and pass the bill, as amended Agreed to by voice vote. (text: CR H7598-7600)
action_date: 2006-09-27
text: Passed/agreed to in House: On motion to suspend the rules and pass the bill, as amended Agreed to by voice vote.(text: CR H7598-7600)
action_date: 2006-09-27
text: DEBATE - The House proceeded with forty minutes of debate on H.R. 5585.
action_date: 2006-09-27
text: Considered under suspension of the rules. (consideration: CR H7598-7601)
action_date: 2006-09-27
text: Mr. McHenry moved to suspend the rules and pass the bill, as amended.
action_date: 2006-09-22
text: Placed on the Union Calendar, Calendar No. 403.
action_date: 2006-09-22
text: Committee on Judiciary discharged.
action_date: 2006-09-22
text: Committee on Judiciary discharged.
action_date: 2006-09-12
text: House Committee on Judiciary Granted an extension for further consideration ending not later than Sept. 22, 2006.
action_date: 2006-09-12
text: Reported by the Committee on Financial Services. H. Rept. 109-648, Part I.
action_date: 2006-09-12
text: Reported by the Committee on Financial Services. H. Rept. 109-648, Part I.
action_date: 2006-06-14
text: Ordered to be Reported by Voice Vote.
action_date: 2006-06-14
text: Committee Consideration and Mark-up Session Held.
action_date: 2006-06-12
text: Referred to the Committee on Financial Services, and in addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
action_date: 2006-06-12
text: Referred to the Committee on Financial Services, and in addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
action_date: 2006-06-12
text: Referred to the Committee on Financial Services, and in addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
action_date: 2006-06-12
text: Introduced in House
action_date: 2006-06-12
text: Introduced in House

Enacted as: number: 109-390