Government Securities Act of 1986
PL 99-571 (H.R.2032), enacted 10/28/1986

100 STAT. 3208 
PUBLIC LAW 99-571—OCT. 28, 1986 
Public Law 99-571 
99th Congress 
An Act 
Oct. 28, 1986 
[H.R. 2032] 
Government 
Securities Act of 
1986. 
15 use 78a note. 
15 use 78o-5 
note. 
15 use 78a. 
Mail. 
eommerce and 
trade. 
15 use 78o-5. 
Banks and 
banking. 
;; 
An Act Entitled the Government Securities Act of 1986. 
•••'}, 
Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled, 
SECTION 1. SHORT TITLE AND FINDINGS. 
(a) SHORT TITLE.—This Act may be cited as the "Government 
Securities Act of 1986". 
(b) FINDINGS.—The Congress finds that transactions in govern-
ment securities are affected with a pubUc interest which makes it 
necessary— 
(1) to provide for the integrity, stabiHty, and efficiency of such 
transactions and of matters and practices related thereto; 
(2) to impose adequate regulation of government securities 
brokers and government securities dealers generally; and 
(3) to require appropriate financial responsibility, record-
keeping, reporting, and related regulatory requirements; 
in order to protect investors and to insure the maintenance of fair, 
honest, and liquid markets in such securities. 
TITLE I—GOVERNMENT SECURITIES BROKERS AND 
' 
DEALERS 
.1 
SEC. 101. ESTABLISHMENT OF GOVERNMENT SECURITIES REGULATORY 
AUTHORITY. 
The Securities Exchange Act of 1934 (hereinafter in this title re-
ferred to as "the Act") is amended by inserting after section 15B (15 
U.S.C. 78o-4) the following new section: 
"GOVERNMENT SECURITIES BROKERS AND DEALERS 
"SEC. 15C. (a)(1)(A) It shall be unlawful for any government 
securities broker or government securities dealer (other than a 
registered broker or dealer or a financial institution) to make use of 
the mails or any means or instrumentality of interstate commerce 
to effect any transaction in, or to induce or attempt to induce the 
purchase or sale of, any government security unless such govern-
ment securities broker or government securities dealer is registered 
in accordance with paragraph (2) of this subsection. 
"(B)(i) It shall be unlawful for any government securities broker or 
government securities dealer that is a registered broker or dealer 
or a financial institution to make use of the mails or any means or 
instrumentality of interstate commerce to effect any transaction in, 
or to induce or attempt to induce the purchase or sale of, any 
government security unless such government securities broker or 
government securities dealer has filed with the appropriate regu-
latory agency written notice that it is a government securities 
broker or government securities dealer. When a government securi-
ties broker or government securities dealer ceases to act as such it 
PUBLIC LAW 99-571—OCT. 28, 1986 
100 STAT. 3209 
shall file with the appropriate regulatory agency a written notice 
that it is no longer acting as a government securities broker or 
government securities dealer. 
"(ii) Such notices shall be in such form and contain such informa-
tion concerning a government securities broker or government secu-
rities dealer that is a financial institution and any persons 
associated with such government securities broker or government 
securities dealer as the Board of Governors of the Federal Reserve 
System shall, by rule, after consultation with each appropriate 
regulatory agency (including the Commission), prescribe as nec-
essary or appropriate in the public interest or for the protection of 
investors. Such notices shall be in such form and contain such 
information concerning a government securities broker or govern-
ment securities dealer that is a registered broker or dealer and any 
persons associated with such government securities broker or 
government securities dealer as the Commission shall, by rule, 
prescribe as necessary or appropriate in the public interest or for 
the protection of investors. 
"(iii) Each appropriate regulatory agency (other than the Commis-
sion) shall make available to the Commission the notices which have 
been filed with it under this subparagraph, and the Commission 
shall maintain and make available to the public such notices and 
the notices it receives under this subparagraph. 
"(2) A government securities broker or a government securities 
dealer subject to the registration requirement of paragraph (1)(A) of 
this subsection may be registered by filing with the Commission an 
application for registration in such form and containing such 
information and documents concerning such government securities 
broker or government securities dealer and any persons associated 
with such government securities broker or government securities 
dealer as the Commission, by rule, may prescribe as necessary or 
appropriate in the public interest or for the protection of investors. 
Within 45 days of the date of filing of such application (or within 
such longer period as to which the applicant consents), the Commis-
sion shall— 
"(i) by order grant registration, or 
"(ii) institute proceedings to determine whether registration 
should be denied. Such proceedings shall include notice of the 
grounds for denial under consideration and opportunity for 
hearing and shall be concluded within 120 days of the date of 
the filing of the application for registration. At the conclusion of 
such proceedings, the Commission, by order, shall grant or deny 
such registration. The Commission may extend the time for the 
conclusion of such proceedings for up to 90 days if it finds good 
cause for such extension and publishes its reasons for so finding 
or for such longer period as to which the applicant consents. 
The Commission shall grant the registration of a government securi-
ties broker or a government securities dealer if the Commission 
finds that the requirements of this section are satisfied. The 
Commission shall deny such registration if it does not make such a 
finding or if it finds that if the applicant were so registered, its 
registration would be subject to suspension or revocation under 
subsection (c) of this section. 
"(3) Any provision of this title (other than section 5 or paragraph 
(1) of this subsection) which prohibits any act, practice, or course of 
business if the mails or any means or instrumentality of interstate 
commerce is used in connection therewith shall also prohibit any 
Regulations. 
Public 
information. 
Regulations. 
Mail. 
Commerce and 
trade. 
100 STAT. 3210 
PUBLIC LAW 99-571—OCT. 28, 1986 
Regulations. 
Reports. 
Records. 
Records. 
Fraud. 
Discrimination, 
prohibition. 
t)0« oc 
such act, practice, or course of business by any government securi-
ties broker or government securities dealer registered or having 
filed notice under paragraph (1) of this subsection or any person 
acting on behalf of such government securities broker or govern-
ment securities dealer, irrespective of any use of the mails or any 
means or instrumentality of interstate commerce in connection 
therewith. 
"(4) The Secretary of the Treasury (hereinafter in this section 
referred to as the 'Secretary'), by rule or order, upon the Secretary's 
own motion or upon application, may conditionally or uncondition-
ally exempt any government securities broker or government securi-
ties dealer, or class of government securities brokers or government 
securities dealers, from any provision of subsection (a), (b), or (d) of 
this section or the rules thereunder, if the Secretary finds that such 
exemption is consistent with the public interest, the protection of 
investors, and the purposes of this title. 
"(bXD The Secretary shall propose and adopt rules to effect the 
purposes of this title with respect to transactions in government 
securities effected by government securities brokers and govern-
ment securities dealers as follows: 
"(A) Such rules shall provide safeguards with respect to the 
financial responsibility and related practices of government 
securities brokers and government securities dealers including, 
but not limited to, capital adequacy standards, the acceptance of 
custody and use of customers' securities, the carrying and use of 
customers' deposits or credit balances, and the transfer and 
control of government securities subject to repurchase agree-
ments and in similar transactions. 
"(B) Such rules shall require every government securities 
broker and government securities dealer to make reports to and 
furnish copies of records to the appropriate regulatory agency, 
and to file with the appropriate regulatory agency, annually or 
more frequently, a balance sheet and income statement certified 
by an independent public accountant, prepared on a calendar or 
fiscal year basis, and such other financial statements (which 
shall, as the Secretary specifies, be certified) and information 
concerning its financial condition as required by such rules. 
"(C) Such rules shall require records to be made and kept by 
government securities brokers and government 
securities 
dealers and shall specify the periods for which such records 
shall be preserved. 
"(2) Rules promulgated and orders issued under this section 
shall— 
"(A) be designed to prevent fraudulent and manipulative acts 
and practices and to protect the integrity, liquidity, and effi-
ciency of the market for government securities, investors, and 
the public interest; and 
"(B) not be designed to permit unfair discrimination between 
customers, issuers, government securities brokers, or govern-
ment securities dealers, or to impose any burden on competition 
not necessary or appropriate in furtherance of the purposes of 
this title. 
"(3) In promulgating rules and issuing orders under this section, 
the Secretary— 
"(A) may appropriately classify government securities brokers 
and government securities dealers (taking into account relevant 
matters, including types of business done, nature of securities 
PUBLIC LAW 99-571—OCT. 28, 1986 
100 STAT. 3211 
other than government securities purchased or sold, and char-
acter of business organization) and persons associated with 
government securities brokers and government 
securities 
dealers; 
"(B) may determine, to the extent consistent with paragraph 
(2) of this subsection and with the public interest, the protection 
of investors, and the purposes of this title, not to apply, in whole 
or in part, certain rules under this section, or to apply greater, 
lesser, or different standards, to certain classes of government 
securities brokers, government securities dealers, or persons 
associated with government securities brokers or government 
securities dealers; 
"(C) shall consider the sufficiency and appropriateness of then 
existing laws and rules applicable to government securities 
brokers, government securities dealers, and persons associated 
with government securities brokers and government securities 
dealers; and 
"(D) shall consult with and consider the views of the Commis-
sion and the Board of Governors of the Federal Reserve System, 
except where the Secretary determines that an emergency 
exists requiring expeditious or summary action and publishes 
its reasons for such determination. 
"(4) If the Commission or the Board of Governors of the Federal 
Reserve System comments in writing on a proposed rule of the 
Secretary that has been published for comment, the Secretary shall 
respond in writing to such written comment before approving the 
;?»:j ;j 
proposed rule. 
"(5) No government securities broker or government securities 
Mail. 
dealer shall make use of the mails or any means or instrumentality 
£°™™^^^^ ^^^ 
of interstate commerce to effect any transaction in, or to induce or 
attempt to induce the purchase or sale of, any government security 
in contravention of any rule under this section. 
"(c)(1) With respect to any government securities broker or 
government securities dealer registered or required to register 
under subsection (a)(1)(A) of this section— 
"(A) The Commission, by order, shall censure, place limita-
tions on the activities, functions, or operations of, suspend for a 
period not exceeding 12 months, or revoke the registration of 
such government securities broker or government securities 
dealer, if it finds, on the record after notice and opportunity for 
hearing, that such censure, placing of limitations, suspension, 
or revocation is in the public interest and that such government 
securities broker or government securities dealer, or any person 
associated with such government securities broker or govern-
ment securities dealer (whether prior or subsequent to becom-
ing so associated), has committed or omitted any act or omission 
enumerated in subparagraph (A), (D), or (E) of paragraph (4) of 
section 15(b) of this title, has been convicted of any offense 
15 USC Y
8
o
. 
specified in subparagraph (B) of such paragraph (4) within 10 
years of the commencement of the proceedings under this para-
graph, or is enjoined from any action, conduct, or practice 
specified in subparagraph (C) of such paragraph (4). 
"(B) Pending final determination whether registration of any 
government securities broker or government securities dealer 
shall be revoked, the Commission, by order, may suspend such 
registration, if such suspension appears to the Commission, 
after notice and opportunity for hearing, to be necessary or 
trade. 
100 STAT. 3212 
PUBLIC LAW 99-571—OCT. 28, 1986 
appropriate in the public interest or for the protection of inves-
tors. Any registered government securities broker or registered 
government securities dealer may, upon such terms and condi-
tions as the Commission may deem necessary in the public 
interest or for the protection of investors, withdraw from reg-
istration by filing a written notice of withdrawal with the 
Commission. If the Commission finds that any registered 
government securities broker or registered government securi-
ties dealer is no longer in existence or has ceased to do business 
as a government securities broker or government securities 
dealer, the Commission, by order, shall cancel the registration 
of such government securities broker or government securities 
dealer. 
"(C) The Commission, by order, shall censure or place limita-
tions on the activities or functions of any person associated, or 
seeking to become associated, with a government securities 
broker or government securities dealer registered or required to 
register under subsection (a)(1)(A) of this section or suspend for 
a period not exceeding 12 months or bar any such person from 
being associated with such a government securities broker or 
government securities dealer, if the Commission finds, on the 
record after notice and opportunity for hearing, that such cen-
sure, placing of limitations, suspension, or bar is in the public 
interest and that such person has committed or omitted any act 
or omission enumerated in subparagraph (A), (D), or (E) of 
15 use 78o. 
paragraph (4) of section 15(b) of this title, has been convicted of 
any offense specified in subparagraph (B) of such paragraph (4) 
^ . 
within 10 years of the commencement of the proceedings under 
^
^ 
this paragraph, or is enjoined from any action, conduct, or 
practice specified in subparagraph (C) of such paragraph (4). 
"(2)(A) With respect to any government securities broker or 
government securities dealer which is not registered or required to 
register under subsection (aXl)(A) of this section, the appropriate 
regulatory agency for such government securities broker or govern-
ment securities dealer may, in the manner and for the reasons 
specified in paragraph (1)(A) of this subsection, censure, place limita-
tions on the activities, functions, or operations of, suspend for a 
period not exceeding 12 months, or bar from acting as a government 
securities broker or government securities dealer any such govern-
ment securities broker or government securities dealer, and may 
sanction any person associated with such government securities 
broker or government securities dealer in the manner and for the 
reasons specified in paragraph (1)(C) of this subsection. 
"(B) In addition, where applicable, such appropriate regulatory 
agency may, in accordance with section 8 of the Federal Deposit 
Insurance Act (12 U.S.C. 1818), section 5 of the Home Owners' Loan 
Act of 1933 (12 U.S.C. 1464), or section 407 of the National Housing 
'
^ ' ' 
Act (12 U.S.C. 1730), enforce compliance by such government securi-
ties broker or government securities dealer or any person associated 
with such government securities broker or government securities 
dealer with the provisions of this section and the rules thereunder. 
"(C) For purposes of subparagraph (B) of this paragraph, any 
violation of any such provision shall constitute adequate basis for 
the issuance of any order under section 80t)) or 8(c) of the Federal 
Deposit Insurance Act, section 5(d)(2) or 5(d)(3) of the Home Owners' 
Loan Act of 1933, or section 407(e) or 407(f) of the National Housing 
Act, and the customers of any such government securities broker or 
PUBLIC LAW 99-571—OCT. 28, 1986 
100 STAT. 3213 
government securities dealer shall be deemed, respectively, 'deposi-
tors' as that term is used in section 8(c) of the Federal Deposit 
Insurance Act, 'savings account holders' as that term is used in 
section 5(d)(3) of the Home Owners' Loan Act of 1933, or 'insured 
members' as that term is used in section 407(f) of the National 
Housing Act. 
"(D) Nothing in this paragraph shall be construed to affect in any 
way the powers of such appropriate regulatory agency to proceed 
against such government securities broker or government securities 
dealer under any other provision of law. 
"(E) Each appropriate regulatory agency (other than the Commis-
sion) shall promptly notify the Commission after it has imposed any 
sanction under this paragraph on a government securities broker or 
government securities dealer, or a person associated with a govern-
ment securities broker or government securities dealer, and the 
Commission shall maintain, and make available to the public, a 
record of such sanctions and any sanctions imposed by it under this 
subsection. 
"(3) It shall be unlawful for any person as to whom an order 
entered pursuant to paragraph (1) or (2) of this subsection suspend-
ing or barring him from being associated with a government securi-
ties broker or government securities dealer is in effect willfully to 
become, or to be, associated with a government securities broker or 
government securities dealer without the consent of the appropriate 
regulatory agency, and it shall be unlawful for any government 
securities broker or government securities dealer to permit such a 
person to become, or remain, a person associated with it without the 
consent of the appropriate regulatory agency, if such government 
securities broker or government securities dealer knew, or, in the 
exercise of reasonable care should have known, of such order. 
"(d)(1) All records of a government securities broker or govern-
ment securities dealer are subject at any time, or from time to time, 
to such reasonable periodic, special, or other examinations by rep-
resentatives of the appropriate regulatory agency for such govern-
ment securities broker or government securities dealer as such 
appropriate regulatory agency deems necessary or appropriate in 
the public interest, for the protection of investors, or otherwise in 
furtherance of the purposes of this title. 
"(2) Information received by any appropriate regulatory agency or 
the Secretary from or with respect to any government securities 
broker or government securities dealer or with respect to any person 
associated therewith may be made available by the Secretary or the 
recipient agency to the Commission, the Secretary, any appropriate 
regulatory agency, and any self-regulatory organization. 
'(eXD It shall be unlawful for any government securities broker or 
government securities dealer registered or required to register with 
the Commission under subsection (a)(1)(A) to effect any transaction 
in, or induce or attempt to induce the purchase or sale of, any 
government security, unless such government securities broker or 
government securities dealer is a member of a national securities 
exchange registered under section 6 of this title or a securities 
association registered under section 15A of this title. 
"(2) The Commission, after consultation with the Secretary, by 
rule or order, as it deems consistent with the public interest and the 
protection of investors, may conditionally or unconditionally exempt 
from paragraph (1) of this subsection any government securities 
broker or government securities dealer or class of government 
12 use 1818. 
12 use 1464. 
12 use 1730. 
Public 
information. 
Records. 
Law 
enforcement and 
crime. 
15 use 78f. 
15 use 78o-3. 
100 STAT. 3214 
PUBLIC LAW 99-571—OCT. 28, 1986 
securities brokers or government securities dealers specified in such 
rule or order. 
rrj!', 
;. 
"(0(1) Nothing in this section except paragraph (2) of this subsec-
, j , 
tion shall be construed to impair or limit the authority under any 
other provision of law of the Commission, the Secretary of the 
, vt •jh-.J::.- Treasury, the Board of Governors of the Federal Reserve System, 
the Comptroller of the Currency, the Federal Deposit Insurance 
Corporation, the Federal Home Loan Bank Board, the Federal 
Savings and Loan Insurance Corporation, the Secretary of Housing 
and Urban Development, and the Government National Mortgage 
^, ;'. 
Association. 
,,. ]•'-' 
"(2) Notwithstanding any other provision of this title, the Commis-
-•> • 
sion shall not have any authority to make investigations of, require 
the filing of a statement by, or take any other action under this title 
against a government securities broker or government securities 
dealer, or any person associated with a government securities 
broker or government securities dealer, for any violation or threat-
ened violation of the provisions of this section or the rules or 
regulations thereunder, unless the Commission is the appropriate 
regulatory agency for such government securities broker or govern-
ment securities dealer. Nothing in the preceding sentence shall be 
construed to limit the authority of the Commission with respect to 
violations or threatened violations of any provision of this title other 
than this section, or the rules or regulations under any such other 
provision. 
Termination 
"(g)(1) The authority of the Secretary to issue orders and to 
date. 
propose and adopt rules under this section shall terminate on 
October 1,1991. 
"(2) All orders and rules— 
"(A) which have been issued or adopted by the Secretary, and 
"(B) which are in effect on the date specified in paragraph (1), 
shall continue in effect according to their terms.". 
SEC. 102. CONFORMING AMENDMENTS. 
(a) DEFINITION OF EXEMPTED SECURITY.—Paragraph (12) of section 
3(a) of the Act (15 U.S.C. 78c(a)(12)) is amended to read as follows: 
"(12)(A) The term 'exempted security' or 'exempted securities' 
includes— 
"(i) government securities, as defined in paragraph (42) of 
this subsection; 
"(ii) municipal securities, as defined in paragraph (29) of 
this subsection; 
, 
"(iii) any interest or participation in any common trust 
fund or similar fund maintained by a bank exclusively for 
the collective investment and reinvestment of assets 
I, 
i,,, r1 
contributed thereto by such bank in its capacity as trustee, 
' .;fV. 
executor, administrator, or guardian; 
"(iv) any interest or participation in a single trust fund, 
or a collective trust fund maintained by a bank, or any 
security arising out of a contract issued by an insurance 
t. ;.* 
company, which interest, participation, or security is issued 
in connection with a qualified plan as defined in subpara-
graph (C) of this paragraph; and 
"(v) such other securities (which may include, among 
others, unregistered securities, the market in which is 
predominantly intrastate) as the Commission may, by such 
, , .., 
rules and regulations as it deems consistent with the public 
PUBLIC LAW 99-571—OCT. 28, 1986 
100 STAT. 3215 
; 
interest and the protection of investors, either uncondition-
ally or upon specified terms and conditions or for stated 
periods, exempt from the operation of any one or more 
provisions of this title which by their terms do not apply to 
an 'exempted security' or to 'exempted securities'. 
"(BXi) Notwithstanding subparagraph (A)(i) of this paragraph, 
f 
government securities shall not be deemed to be 'exempted 
securities' for the purposes of section 17A of this title. 
15 use 78q-i. 
1 
"(ii) Notwithstanding subparagraph (A)(ii) of this paragraph, 
s 
municipal securities shall not be deemed to be 'exempted securi-
d 
ties' for the purposes of sections 15, 15A (other than subsection 
(g)(3)), and 17 
A of this title. 
5 use 78o, 78o-3, 
"(C) For purposes of subparagraph (AXiv) of this parajgraph, 
78q-i. 
the term 'qualified plan' means (i) a stock bonus, pension, or 
profit-sharing plan which meets the requirements for qualifica-
' 
tion under section 401 of the Internal Revenue Code of 1954, (ii) 26 use 401. 
an annuity plan which meets the requirements for the deduc-
tion of the employer's contribution under section 404(aX2) of 26 use 404. 
such Code, or (iii) a governmental plan as defined in section 
414(d) of such Code which has been established by an employer 
26 use 414. 
''' 
for the exclusive benefit of its employees or their beneficiaries 
for the purpose of distributing to such employees or their 
beneficiaries the corpus and income of the funds accumulated 
under such plan, if under such plan it is impossible, prior to the 
, 
satisfaction of all liabilities with respect to such employees and 
^ 
their beneficiaries, for any part of the corpus or income to be 
; 
used for, or diverted to, purposes other than the exclusive 
* 
benefit of such employees or their beneficiaries, other than any 
plan described in clause (i), (ii), or (iii) of this subparagraph 
which (I) covers employees some or all of whom are employees 
within the meaning of section 401(c) of such Code, or (II) is a 
26 use 401. 
^. 
plan funded by an annuity contract described in section 403(b) 
of such Code.". 
(b) DEFINITION OF APPROPRIATE REGULATORY AGENCY.—Section 
i5 use 78c. 
3(aX34) of the Act is amended— 
^ 
(1) by inserting after paragraph (F) thereof the following new 
paragraph: 
"(G) When used with respect to a government securities 
J 
broker or government securities dealer, or person associated 
with a government securities broker or government securities 
dealer: 
"(i) the Comptroller of the Currency, in the case of a 
national bank, a bank in the District of Columbia examined 
by the Comptroller of the Currency, or a Federal branch or 
Federal agency of a foreign bank (as such terms are used in 
; 
the International Banking Act of 1978); 
12 use 3ioi 
"(ii) the Board of Governors of the Federal Reserve note. 
,;5 30 
System, in the case of a State member bank of the Federal 
, .^ 
; 
Reserve System, a foreign bank, a State branch or a State 
;- . ii-
\ 
agency of a foreign bank, or a commercial lending company 
owned or controlled by a foreign bank (as such terms are 
.,.-^i -^ 
used in the International Banking Act of 1978); 
"(iii) the Federal Deposit Insurance Corporation, in the 
il., 
case of a bank insured by the Federal Deposit Insurance 
.vf-' 
Corporation (other than a member of the Federal Reserve 
System or a Federal savings bank); 
100 STAT. 3216 
PUBLIC LAW 99-571—OCT. 28, 1986 
"(iv) the Federal Home Loan Bank Board, in the case of a 
Federal savings and loan association. Federal savings bank, 
or District of Columbia savings and loan association; 
''•> 
"(v) the Federal Savings and Loan Insurance Corporation, 
in the case of an institution insured by the Federal Savings 
" 
and Loan Insurance Corporation (other than a Federal 
I* •! savings and loan association. Federal savings bank, or Dis-
. i yo 
; I 3 f 
trict of Columbia savings and loan association); 
"(vi) the Commission, in the case of all other government 
securities brokers and government securities dealers."; and 
it ?
i J 
(2) by inserting ", and the term 'District of Columbia savings 
""' •" 
and loan association' means any association subject to examina-
tion and supervision by the Federal Home Loan Bank Board 
12 use 1466a. 
under section 8 of the Home Owners' Loan Act of 1933" before 
the period ending the last sentence thereof. 
(c) DEFINITION OF STATUTORY DISQUALIFICATION.—Section 3(a)(39) 
of such Act (15 U.S.C. 78c(a)(39)) is amended— 
t' jT f 
(1) in subparagraph (B)— 
(A) by inserting "or other appropriate regulatory agency" 
after "Commission"; and 
(B) by striking out "or municipal securities dealer" and 
1, 
inserting in lieu thereof "municipal securities dealer, 
'- *
; 
government securities broker, or government securities 
dealer"; and 
(2) in subparagraph (C)— 
(A) by striking out "or municipal securities dealer" and 
inserting in lieu thereof "municipal securities dealer, 
government securities broker, or government securities 
dealer"; and 
(B) by inserting ", an appropriate regulatory agency," 
i..h",% > ', 
after "Commission". 
(d) ADDITIONAL DEFINITIONS.—Section 3(a) of such Act (15 U.S.C. 
78c(a)) is further amended by adding at the end thereof the following 
^
^ ^,. ; , 
new paragraphs: 
"(42) The term 'government securities' means— 
,j.,,^^. 
"(A) securities which are direct obligations of, or obliga-
tions guaranteed as to principal or interest by, the United 
<c,.-^i*''-"' • S t a t e s ; 
"(B) securities which are issued or guaranteed by corpora-
tions in which the United States has a direct or indirect 
interest and which are designated by the Secretary of the 
Treasury for exemption as necessary or appropriate in the 
f 
public interest or for the protection of investors; 
"(C) securities issued or guaranteed as to principal or 
_•. ^ 
interest by any corporation the securities of which are 
iji *
5
«
< . ' designated, by statute specifically naming such corporation, 
. : 
to constitute exempt securities within the meaning of the 
laws administered by the Commission; or 
Ante, p. 3208; 15 
"(D) for purposes of sections 15C and 17A, any put, call, 
USC76q-i. 
straddle, option, or privilege on a security described in 
subparagraph (A), (B), or (C) other than a put, call, straddle, 
option, or privilege— 
"(i) that is traded on one or more national securities 
'Mil Hi • 
exchanges; or 
"(ii) for which quotations are disseminated through 
an automated quotation system operated by a reg-
istered securities association. - * ' 
. W...V 
**n 
PUBLIC LAW 99-571—OCT. 28, 1986 
100 STAT. 3217 
"(43) The term 'government securities broker' means any 
person regularly engaged in the business of effecting trans-
actions in government securities for the account of others, but 
does not include— 
"(A) any corporation the securities of which are govern- 
.. , 
^ 
ment securities under subparagraph (B) or (C) of paragraph 
(42) of this subsection; or 
, 
j^,, 
"(B) any person registered with the Commodity Futures 
Trading Commission, any contract market designated by 
the Commodity Futures Trading Commission, such contract 
market's affiliated clearing organization, or any floor 
trader on such contract market, solely because such person 
effects transactions in government securities that the 
Commission, after consultation with the Commodity Fu-
tures Trading Commission, has determined by rule or order 
to be incidental to such person's futures-related business. 
"(44) The term 'government securities dealer' means any 
person engaged in the business of buying and selling govern-
ment securities for his own account, through a broker or other-
wise, but does not include— 
"(A) any person insofar as he buys or sells such securities 
for his own account, either individually or in some fiduciary 
capacity, but not as a part of a regular business; 
'(B) any corporation the securities of which are govern-
ment securities under subparagraph (B) or (C) of paragraph 
(42) of this subsection; 
"(C) any bank, unless the bank is engaged in the business 
of buying and selling government securities for its own 
account other than in a fiduciary capacity, through a 
broker or otherwise; or 
"(D) any person registered with the Commodity Futures 
Trading Commission, any contract market designated by 
the Commodity Futures Trading Commission, such contract 
' 
market's affiliated clearing organization, or any floor 
trader on such contract market, solely because such person 
effects transactions in government securities that the 
Commission, after consultation with the Commodity Fu-
tures Trading Commission, has determined by rule or order 
to be incidental to such person's futures-related business. 
"(45) The term 'person associated with a government securi-
ties broker or government securities dealer' means any partner, 
officer, director, or branch manager of such government securi-
ties broker or government securities dealer (or any person 
occupying a similar status or performing similar functions), and 
any other employee of such government securities broker or 
government securities dealer who is engaged in the manage-
ment, direction, supervision, or performance of any activities 
relating to government securities, and any person directly or 
indirectly controlling, controlled by, or under common control 
with such government securities broker or government securi-
ties dealer. 
"(46) The term 'financial institution' means (A) a bank (as 
such term is defined in paragraph (6) of this subsection), (B) a 
foreign bank, and (C) an insured institution (as such term is 
defined in section 401 of the National Housing Act). 
12 use 1724. 
"(48) The term 'registered broker or dealer means a broker or 
dealer registered or required to register pursuant to section 15 
100 STAT. 3218 
PUBLIC LAW 99-571—OCT. 28, 1986 
78 ^f ^ ^^°' 
°^ "^^^ °^ ^^^^ title, except that in paragraph (3) of this subsec-
15°USC 78f 
^^^^ ^^^ sections 6 and 15A the term means such a broker or 
78o-3. 
' 
* dealer and a government securities broker or government secu-
rities dealer registered or required to register pursuant to sec-
Ante, p. 3208. 
tion 15C(a)(l)(A) of this title.". 
(e) ENFORCEMENT AND DISCIPLINE.—Section 15(b) of the Securities 
15 use 78o. 
Exchange Act of 1934 (15 U.S.C. 78o(b)) is amended— 
(1) in paragraph (4)(A), by inserting "or with any other appro-
priate regulatory agency" after "Commission" the first time it 
appears therein; 
(2) in paragraph (4)(B), by inserting in clause (ii) thereof 
"government securities broker, government securities dealer," 
after "municipal securities dealer,"; 
(3) in paragraph (4)(C), by striking out "or municipal securi-
ties dealer," and inserting in lieu thereof "municipal securities 
dealer, government securities broker, or government securities 
dealer,"; and 
(4) in paragraph (8)— 
(A) by striking out "any broker or dealer required to 
n
; ? iho . register pursuant to this title" and inserting in lieu thereof 
"any registered broker or dealer"; and 
(B) by striking out "an exempted security". 
(f) NET CAPITAL.—Section 15(c)(3) of such Act (15 U.S.C. 78o(c)(3)) is 
amended— 
(1) by inserting "(other than a government securities broker 
- ...J or government securities dealer, except a registered broker or 
dealer)" after "dealer"; and 
(2) by inserting "(except a government security)" after 
"exempted security". 
(g) REGISTERED SECURITIES ASSOCIATIONS.—(1) Section 15A(f) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78o-3(f)) is amended to 
read as follows: 
"(f)(1) Except as provided in paragraph (2) of this subsection, 
nothing in this section shall be construed to apply with respect to 
any transaction by a registered broker or dealer in any exempted 
security. 
"(2) A registered securities association may adopt and implement 
rules applicable to members of such association (A) to enforce 
compliance by registered brokers and dealers with applicable provi-
sions of this title and the rules and regulations thereunder, (B) to 
provide that its members and persons associated with its members 
shall be appropriately disciplined, in accordance with subsections 
(b)(7), (b)(8), and (h) of this section, for violation of applicable provi-
sions of this title and the rules and regulations thereunder, (C) to 
provide for reasonable inspection and examination of the books and 
records of registered brokers and dealers, (D) to provide for the 
matters described in paragraphs (b)(3), (b)(4), and (bX5) of this sec-
tion, (E) to implement the provisions of subsection (g) of this section, 
and (F) to prohibit fraudulent, misleading, deceptive, and false 
advertising. 
"(3) Nothing in subsection (bX6) or (b)(ll) of this section shall be 
construed to permit a registered securities association to make rules 
concerning any transaction by a registered broker or dealer in a 
J-'; > i i 
municipal security.". 
(2) Section 15A(g) of such Act (15 U.S.C. 78o-3(g)) is amended— 
**' 
(A) by inserting after paragraph (3)(C) the following: 
PUBLIC LAW 99-571—OCT. 28, 1986 
100 STAT. 3219 
"(D) Nothing in subparagraph (A), (B), or (C) of this paragraph 
shall be construed to permit a registered securities association to 
deny membership to or condition the membership of, or bar any 
person from becoming associated with or condition the association of 
any person with, a broker or dealer that engages exclusively in 
transactions in exempted securities."; 
(B) by redesignating paragraph (4) as paragraph (5); and 
(C) by inserting after paragraph (3) the following new 
'^"' paragraph: 
"(4)(A) A registered securities association may deny membership 
to, or condition the membership of, a government securities broker 
or government securities dealer if such government securities 
broker or government securities dealer (i) does not meet standards of 
financial responsibility under rules adopted pursuant to section 
15C(b)(l)(A) of this title, or (ii) has engaged and there is a reasonable 
Ante, p. 3208. 
likelihood that it will again engage in any conduct or practice which 
would subject such government securities broker or government 
securities dealer to sanctions under section 15C(c) of this title. A 
registered securities association may establish procedures including 
examination of the books and records of government securities 
brokers and government securities dealers to verify compliance with 
• 
the provisions of this title and the rules thereunder. 
"(B) A registered securities association may bar any person from 
becoming associated with a member or condition the association of a 
person with a member (i) if such person has engaged in any conduct 
or practice and there is a reasonable likelihood that such person will 
again engage in any conduct or practice which would subject such 
person to sanctions under section 15C(c) of this title, or (ii) if such 
person does not agree to supply such association with such informa-
tion with respect to its relationship and dealings with the member 
as may be specified in the rules of the association and to permit 
examination of its books and records to verify the accuracy 
- '-^^ 
thereof.". 
(h) FILING OF AND ACCESS TO DOCUMENTS.—Section 17(c) of the Act 
(15 U.S.C. 78q(c)) is amended by adding at the end thereof the 
following new paragraph: 
"(4) The Commission or the appropriate regulatory agency may 
specify that documents required to be filed pursuant to this subsec-
tion with the Commission or such agency, respectively, may be 
retained by the originating clearing agency, transfer agent, or 
municipal securities dealer, or filed with another appropriate regu-
latory agency. The Commission or the appropriate regulatory 
agency (as the case may be) making such a specification shall 
continue to have access to the document on request.". 
(i) LOST AND STOLEN SECURITIES.—Section 17(f) of the Securities 
Exchange Act of 1934 (15 U.S.C. 78q(f)) is amended— 
(1) in paragraph (1) by inserting "government securities 
broker, government securities dealer," after "municipal securi-
ties dealer,"; 
^" 
(2) in paragraph (1)(A), by inserting "and, in the case of 
government securities, to the Secretary of the Treasury" after 
"Commission" the second time it appears; and 
(3) in paragraph (3)— 
(A) by inserting "(A)" after "(3)"; and 
(B) by adding the following new subparagraph: 
"(B) In order to carry out the authority under paragraph (1) of this 
Contracts. 
subsection, the Commission or its designee and the Secretary of the 
100 STAT. 3220 
PUBLIC LAW 99-571—OCT. 28, 1986 
Treasury shall enter into an agreement whereby the Commission or 
its designee will receive, store, and disseminate information in the 
possession, and which comes into the possession, of the Department 
of the Treasury in regard to missing, lost, counterfeit, or stolen 
securities.". 
(j) 
BURDEN ON COMPETITION; PUBLIC RULEMAKING 
REQUIRE-
MENTS.—Section 23(a) of the Securities Exchange Act of 1934 (15 
U.S.C. 78w(a)) is amended— 
(1) by inserting "and the Secretary of the Treasury" after 
"Commission" each place it appears in paragraph (2); 
(2) by inserting "or the Secretary's" after "Commission's" in 
paragraph (2); 
(3) by inserting "and the Secretary" after "Commission" the 
first, second, and fourth places it appears in paragraph (3); and 
i?^, ,,, .iK 
(4) by inserting "or the Secretary" after "Commission" the 
third place it appears in paragraph (3). 
(k) JUDICIAL REVIEW OF ORDERS AND RULES.—Section 25(d)(1) of 
the Act (15 U.S.C. 78y(d)(l)) is amended by inserting before the 
period at the end thereof the following: "and the Secretary of the 
Treasury insofar as he is acting pursuant to section 15C of this 
Ante, p. 3208. 
title". 
Banks and 
(1) INVESTMENT COMPANIES: DiSQUAUFICATIONS.—Section 9 of the 
banking. 
Investment Company Act of 1940 (15 U.S.C. 80a-9) is amended— 
(1) by striking out paragraphs (1) and (2) of subsection (a) and 
inserting in lieu thereof the following: 
"(1) any person who within 10 years has been convicted of any 
felony or misdemeanor involving the purchase or sale of any 
security or arising out of such person s conduct as an under-
writer, broker, dealer, investment adviser, municipal securities 
dealer, government securities broker, government securities 
dealer, or entity or person required to be registered under the 
7 use 1. 
v'x 
Commodity Exchange Act, or as an affiliated person, salesman, 
or employee of any investment company, bank, insurance com-
pany, or entity or person required to be registered under the 
Commodity Exchange Act; 
"(2) any person who, by reason of any misconduct, is perma-
nently or temporarily enjoined by order, judgment, or decree of 
any court of competent jurisdiction from acting as an under-
writer, broker, dealer, investment adviser, municipal securities 
dealer, government securities broker, government securities 
dealer, or entity or person required to be registered under the 
Commodity Exchange Act, or as an affiliated person, salesman, 
or employee of any investment company, bank, insurance com-
pany, or entity or person required to be registered under the 
^il 
Commodity Exchange Act, or from engaging in or continuing 
any conduct or practice in connection with any such activity or 
in connection with the purchase or sale of any security; or"; 
(2) by inserting "or of the Commodity Exchange Act," after 
"this title," in subsection (b)(2); and 
". 
(3) by inserting "or of the Commodity Exchange Act," after 
"this title," in subsection (b)(3). 
(m) INVESTMENT ADVISERS: DISQUALIFICATIONS.—Section 203 of the 
Investment Advisers Act of 1940 (15 U.S.C. 80b-3) is amended— 
(1) by striking out "or fiduciary" in subsection (eX2)(B) and 
inserting in lieu thereof "government securities broker, govern-
c :; .'0 
^i'' 
ment securities dealer, fiduciary, or entity or person required to 
i t 
be registered under the Commodity Exchange Act"; 
.„^e.«. 
PUBLIC LAW 99-571—OCT. 28, 1986 
100 STAT. 3221 
(2) by striking out paragraph (3) of subsection (e) and inserting 
in lieu thereof the following: 
"(3) is permanently or temporarily enjoined by order, judg-
ment, or decree of any court of competent jurisdiction from 
acting as an investment adviser, underwriter, broker, dealer, 
municipal securities dealer, government securities broker, 
government securities dealer, or entity or person required to be 
registered under the Commodity Exchange Act, or as an affili- 
7 USC 1. 
ated person or employee of any investment company, bank, 
insurance company, or entity or person required to be reg-
istered under the Commodity Exchange Act, or from engaging 
in or continuing any conduct or practice in connection with any 
such activity, or in connection with the purchase or sale of any 
security."; and 
(3) by inserting "the Commodity Exchange Act," after "this 
title," in paragraph (4) of subsection (e). 
SEC. 103. STUDIES AND RECOMMENDATIONS WITH RESPECT TO EXTEN-
SION OF TREASURY AUTHORITY. 
(a) TASK FORCE RECOMMENDATION.—The Secretary of the Treas- 
15 USC 78o-5 
ury, together with the Securities and Exchange Commission and the 
note. 
Board of Governors of the Federal Reserve System, shall evaluate 
the effectiveness of the rules promulgated pursuant to section 15C of 
the Securities Exchange Act of 1934 in effecting the purposes of such 
Ante, p. 3208. 
Act, and shall submit to the Congress, not later than October 1, 
1990, their recommendation with respect to the extension of the 
Secretary's authority under such section and such other rec-
ommendations as they may consider appropriate. 
(b) COMPTROLLER GENERAL STUDY AND RECOMMENDATIONS.—The 
Comptroller General shall conduct a study of the regulation of 
government securities brokers and government securities dealers 
pursuant to section 15C of the Securities Exchange Act of 1934 and 
the effectiveness of the amendments made by this Act in protecting 
investors and in effecting the purposes described in section 15C(bX2), 
and shall submit to the Congress, not later than March 31, 1990, his 
recommendations with respect to the extension of the Secretary's 
authority under such section and such other recommendations as he 
may consider appropriate. 
SEC. 104. STUDY OF TRADING SYSTEM FOR GOVERNMENT SECURITIES. 
. 
(a) REQUIREMENTS FOR STUDY.—The Comptroller General, in co-
ordination and consultation with the Board of Governors of the 
Federal Reserve, the Secretary of the Treasury, and the Commis-
sion, shall study the nature of the current trading system in the 
secondary market for government securities, including— 
(1) the extent and form of availability of bids and asks for 
government securities transactions on a real time basis; 
(2) the extent and form of the availability of government 
securities brokers' services in the secondary market; and 
(3) whether quotations for government securities and the 
services of government securities brokers are available on terms 
which are consistent with the public interest, the protection of 
investors, and the purposes of this title. 
0)) PUBLIC HEARINGS.—In addition to the collection of information 
through surveys, public document review, interviews, and other 
information-gathering methods, at least one joint public hearing 
shall be held during the course of conducting the study. 
71-19^ 0 - 89 - 17 : QL. 3 PartA 
100 STAT. 3222 
PUBLIC LAW 99-571—OCT. 28, 1986 
Banks and 
banking. 
Insurance. 
15 u s e 77a. 
Banks and 
banking. 
Banks and 
banking. 
Regulations. 
12 u s e 1818. 
12 u s e 1464. 
12 u s e 1730. 
12 u s e 1786. 
(c) REPORT AND RECOMMENDATIONS.—The report of the Comptrol-
ler General shall be submitted to the Congress no later than 6 
months after the date of enactment of this Act. 
SEC. 105. SECURITIES AND EXCHANGE COMMISSION LEGISLATION STUDY. 
(a) GENERAL 
REQUIREMENTS.—The Securities and Exchange 
Commission is authorized and directed to make a study of the use of 
the exemption contained in section 3(aX2) of the Securities Act of 
1933 (15 U.S.C. 77c(aX2)) for securities guaranteed by banks, and 
of the use of insurance policies to guarantee securities. Such study 
shall include an analysis o
f
— 
(1) the impact of the guarantee provision of such section 
3(aX2) on investor protection and the public interest; 
(2) the impact of the guarantee provision of such section 
3(aX2) on competition between banks and insurance companies 
and between domestic and foreign guarantors; 
(3) whether, and under what circumstances, debt securities 
guaranteed by insurance policies should be exempt from reg-
istration under the Securities Act of 1933; 
(4) an analysis of the impact of such an exemption on investor 
protection and the public interest; and 
(5) such other issues as the Commission deems relevant. 
(b) CONSULTATION.—In conducting the study required by subsec-
tion (a), the Commission shall consult with and solicit comment from 
the Secretary of the Treasury, the Board of Governors of the Federal 
Reserve System, and other Federal bank regulatory agencies. 
(c) REPORT.—The Securities and Exchange Commission shall, on or 
before 6 months after the date of enactment of this Act, submit a 
report to the Congress containing— 
(1) the results of its study under this section; 
(2) the actions it proposes to take on the basis of its study; and 
(3) recommendations for legislation. 
A^; 
TITLE n—DEPOSITORY INSTITUTIONS 
SEC. 201. DEPOSITORY INSTITUTIONS. 
(a) AMENDMENT TO CHAPTER 31 OF TITLE 31, UNITED STATES 
CODE.—Section 3121 of title 31, United States Code, is amended by 
adding at the end thereof the following: 
"(hXD The Secretary shall prescribe by regulation standards for 
the safeguarding and use of obligations issued under this chapter, 
and obligations otherwise issued or guaranteed as to principal or 
interest by the United States. Such regulations shall apply only to a 
depository institution that is not a government securities broker or 
a government securities dealer and that holds such obligations as 
fiduciary, custodian, or otherwise for the account of a customer and 
not for its own account. Such regulations shall provide for the 
adequate segregation of obligations so held, including obligations 
which are purchased or sold subject to resale or repurchase. 
"(2) Violation of a regulation prescribed under paragraph (1) shall 
constitute adequate basis for the issuance of an order under section 
5239(a) or (b) of the Revised Statutes (12 U.S.C. 93(a) or (b)), section 
8(b) or 8(c) of the Federal Deposit Insurance Act, section 5(dX2) or 
5(dX3) of the Home Owners' Loan Act of 1933, section 407(e) or 407(f) 
of the National Housing Act, or section 206(e) or 206(f) of the Federal 
Credit Union Act. Such an order may be issued with respect to a 
depository institution by its appropriate regulatory agency and with 
PUBLIC LAW 99-571—OCT. 28, 1986 
100 STAT. 3223 
respect to a federally insured credit union by the National Credit 
Union Administration Board. 
"(3) Nothing in this subsection shall be construed to affect in any 
way the powers of such agencies under any other provision of law. 
"(4) The Secretary shall, prior to adopting regulations under this 
subsection, determine with respect to each appropriate regulatory 
agency and the National Credit Union Administration Board, 
whether its rules and standards adequately meet the purposes of 
regulations to be promulgated under this subsection, and if the 
- ; 
;: 
Secretary so determines, shall exempt any depository institution 
subject to such rules or standards from the regulations promulgated 
under this subsection. 
• 
"(5) As used in this subsection— 
"(A) 'depository institution' has the meaning stated in clauses 
(i) through (vi) of section 19(b)(1)(A) of the Federal Reserve Act 
12 USC 461. 
and also includes a foreign bank, an agency or branch of a 
foreign bank, and a commercial lending company owned or 
controlled by a foreign bank (as such terms are defined in the 
International Banking Act of 1978). 
"(B) 'government securities broker' has the meaning pre-
scribed in section 3(a)(43) of the Securities Exchange Act of 1934. 
15 USC 78c. 
"(C) 'government securities dealer' has the meaning pre-
scribed in section 3(a)(44) of the Securities Exchange Act of 1934. 
"(D) 'appropriate regulatory agency' has the meaning pre-
scribed in section 3(a)(34)(G) of the Securities Exchange Act of 
1934.". 
(b) AMENDMENTS TO CHAPTER 91 OF TITLE 31, UNITED STATES 
; . 
;; 
CODE.—Chapter 91 of title 31, United States Code, is amended— 
(1) by adding at the end thereof the following: 
"§ 9110. Standards for depository institutions holding securities of 
Regulations. 
a Government-sponsored corporation for customers 
31 use 9110. 
"(a) The Secretary shall prescribe by regulation standards for the 
safeguarding and use of obligations that are government securities 
described in subparagraph (B) or (C) of section 3(a)(42) of the Securi-
ties Exchange Act of 1934. Such regulations shall apply only to a 
depository institution that is not a government securities broker or 
a government securities dealer and that holds such obligations as 
fiduciary, custodian, or otherwise for the account of a customer and 
not for its own account. Such regulations shall provide for the 
adequate segregation of obligations so held, including obligations 
which are purchased or sold subject to resale or repurchase. 
"(b) Violation of a regulation prescribed under subsection (a) shall 
constitute adequate basis for the issuance of an order under section 
5239(a) or (b) of the Revised Statutes (12 U.S.C. 93(a) or (b)), section 
8(b) or 8(c) of the Federal Deposit Insurance Act, section 5(d)(2) or 
12 USC 1818. 
5(d)(3) of the Home Owners' Loan Act of 1933, section 407(e) or 407(f) 
12 use 1464. 
of the National Housing Act, or section 206(e) or 206(f) of the Federal 
12 USC 1730. 
Credit Union Act. Such an order may be issued with respect to a 
12 USC 1786. 
depository institution by its appropriate regulatory agency and with 
respect to a federally insured credit union by the National Credit 
' 
^,' 
Union Administration. 
"(c) Nothing in this section shall be construed to affect in any way 
the powers of such agencies under any other provision of law. 
"(d) The Secretary shall, prior to adopting regulations under this 
section, determine with respect to each appropriate regulatory 
' 
agency and the National Credit Union Administration Board, 
100 STAT. 3224 
PUBLIC LAW 99-571—OCT. 28, 1986 
whether its rules and standards adequately meet the purposes of 
regulations to be promulgated under this section, and if the Sec-
retary so determines, shall exempt any depository institution sub-
ject to such rules or standards from the regulations promulgated 
under this section. 
"(e) As used in this subsection— 
"(1) 'depository institution' has the meaning stated in clauses 
(i) through (vi) of subparagraph 19(b)(1)(A) of the Federal 
12 use 461. 
Reserve Act and also includes a foreign bank, an agency or 
branch of a foreign bank, and a commercial lending company 
owned or controlled by a foreign bank (as such terms are 
12 use 3101 
defined in the International Banking Act of 1978). 
^ote. 
"(2) 'government securities broker' has the meaning pre-
scribed in section 3(a)(43) of the Securities Exchange Act of 1934. 
"(3) 'government securities dealer' has the meaning pre-
scribed in section 3(a)(44) of the Securities Exchange Act of 1934. 
"(4) 'appropriate regulatory agency' has the meaning pre-
scribed in section 3(a)(34)(G) of the Securities Exchange Act of 
1934."; and 
(2) by adding at the end of the chapter analysis the following: 
"9110. Standards for depository institutions holding securities of a Government-
sponsored corporation for customers.". 
TITLE III—TRANSITIONAL AND SAVINGS PROVISIONS 
SEC. 301. TRANSITIONAL AND SAVINGS PROVISIONS. 
15 use 78o-5 
(a) EFFECT ON PENDING ADMINISTRATIVE PROCEEDINGS.—The provi-
note. 
sions of this Act shall not affect any proceedings pending on the 
effective date of this Act. 
(b) EFFECT ON PENDING JUDICIAL PROCEEDINGS.—The provisions of 
, : 
this Act shall not affect suits commenced prior to the effective date 
of this Act, and in all such suits, proceedings shall be had, appeals 
taken, and judgments rendered in the same manner and effect as if 
this Act had not been enacted. 
(c) DISCRETION OF THE FEDERAL RESERVE BANK OF NEW YORK.— 
Nothing in this Act shall be construed to limit or impair the 
discretion or authority of the Federal Reserve Bank of New York to 
require reports or establish terms and conditions in connection with 
the Bank's relationship with any government securities broker or 
government securities dealer, including a primary dealer. 
(d) JURISDICTION OF THE COMMODITY FUTURES TRADING COMMIS-
SION.—Nothing in this Act affects the jurisdiction of the Commodity 
Futures Trading Commission as set forth in the Commodity Ex-
7 use 1. 
change Act over trading of commodity futures contracts and options 
on such contracts involving government securities. 
_,.. TITLE IV—EFFECTIVE DATES 
SEC. 401. GENERAL EFFECTIVE DATES. 
15 use 78o-5 
Except as provided in section 402, this Act and the amendments 
note. 
made by this Act shall take effect 270 days after the date of 
enactment of this Act. 
SEC. 402. EFFECTIVE DATE AND REQUIREMENTS FOR REGULATIONS. 
15 use 78o-5 
Notwithstanding section 401, the Secretary of the Treasury and 
note. 
each appropriate regulatory agency shall, within 120 days after the 
PUBLIC LAW 99-571—OCT. 28, 1986 
100 STAT. 3225 
date of enactment of this Act, publish for notice and public comment 
such regulations as are initially required to implement this Act, 
which regulations shall become effective as temporary regulations 
210 days after the date of enactment of this Act and as final 
regulations not later than 270 days after the date of enactment of 
this Act. 
SEC. 403. REGISTRATION DATE. 
15 USC 78o-5 
No person may continue to act as a government securities broker 
or government securities dealer after 270 days after the date of 
enactment of this Act unless such person has been registered or has 
provided notice to the Commission or the appropriate regulatory 
agency as required by the amendment made by section 101 of this 
Act. 
i'''^'^ > 
Approved October 28, 1986. 
LEGISLATIVE HISTORY—H.R. 2032 (S. 1416): 
HOUSE REPORTS: No. 99-258 (Comm. on Energy and Commerce). 
SENATE REPORTS: No. 99-426 accompanying S. 1416 (Comm. on Banking, Housing, 
and Urban Affairs). 
CONGRESSIONAL RECORD: 
Vol. 131 (1985): Sept. 17, considered and passed House. 
Vol. 132 (1986): Sept. 16, considered and passed Senate, amended, in lieu of S. 
1416. 
Oct. 6, House concurred in Senate amendments with an amend-
ment. 
Oct. 9, Senate concurred in House amendment. 
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 22 (1986): 
Oct. 28, Presidential statement.