[114th Congress Public Law 1]
[From the U.S. Government Publishing Office]
[[Page 129 STAT. 3]]
Public Law 114-1
114th Congress
An Act
To extend the termination date of the Terrorism Insurance Program
established under the Terrorism Risk Insurance Act of 2002, and for
other purposes. <<NOTE: Jan. 12, 2015 - [H.R. 26]>>
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled, <<NOTE: Terrorism Risk
Insurance Program Reauthorization Act of 2015. 15 USC 6701 note.>>
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Terrorism Risk
Insurance Program Reauthorization Act of 2015''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title and table of contents.
TITLE I--EXTENSION OF TERRORISM INSURANCE PROGRAM
Sec. 101. Extension of Terrorism Insurance Program.
Sec. 102. Federal share.
Sec. 103. Program trigger.
Sec. 104. Recoupment of Federal share of compensation under the program.
Sec. 105. Certification of acts of terrorism; consultation with
Secretary of Homeland Security.
Sec. 106. Technical amendments.
Sec. 107. Improving the certification process.
Sec. 108. GAO study.
Sec. 109. Membership of Board of Governors of the Federal Reserve
System.
Sec. 110. Advisory Committee on Risk-Sharing Mechanisms.
Sec. 111. Reporting of terrorism insurance data.
Sec. 112. Annual study of small insurer market competitiveness.
TITLE II--NATIONAL ASSOCIATION OF REGISTERED AGENTS AND BROKERS REFORM
Sec. 201. Short title.
Sec. 202. Reestablishment of the National Association of Registered
Agents and Brokers.
TITLE III--BUSINESS RISK MITIGATION AND PRICE STABILIZATION
Sec. 301. Short title.
Sec. 302. Margin requirements.
Sec. 303. Implementation.
TITLE I--EXTENSION OF TERRORISM INSURANCE PROGRAM
SEC. 101. EXTENSION OF TERRORISM INSURANCE PROGRAM.
Section 108(a) of the Terrorism Risk Insurance Act of 2002 (15
U.S.C. 6701 note) is amended by striking ``December 31, 2014'' and
inserting ``December 31, 2020''.
[[Page 129 STAT. 4]]
SEC. 102. FEDERAL SHARE.
Section 103(e)(1)(A) of the Terrorism Risk Insurance Act of 2002 (15
U.S.C. 6701 note) is amended by inserting ``and beginning on January 1,
2016, shall decrease by 1 percentage point per calendar year until equal
to 80 percent'' after ``85 percent''.
SEC. 103. PROGRAM TRIGGER.
Subparagraph (B) of section 103(e)(1) (15 U.S.C. 6701 note) is
amended in the matter preceding clause (i)--
(1) by striking ``a certified act'' and inserting
``certified acts'';
(2) by striking ``such certified act'' and inserting ``such
certified acts''; and
(3) by striking ``exceed'' and all that follows through
clause (ii) and inserting the following: ``exceed--
``(i) $100,000,000, with respect to such
insured losses occurring in calendar year 2015;
``(ii) $120,000,000, with respect to such
insured losses occurring in calendar year 2016;
``(iii) $140,000,000, with respect to such
insured losses occurring in calendar year 2017;
``(iv) $160,000,000, with respect to such
insured losses occurring in calendar year 2018;
``(v) $180,000,000, with respect to such
insured losses occurring in calendar year 2019;
and
``(vi) $200,000,000, with respect to such
insured losses occurring in calendar year 2020 and
any calendar year thereafter.''.
SEC. 104. RECOUPMENT OF FEDERAL SHARE OF COMPENSATION UNDER THE
PROGRAM.
Section 103(e) of the Terrorism Risk Insurance Act of 2002 (15
U.S.C. 6701 note) is amended--
(1) by amending paragraph (6) to read as follows:
``(6) Insurance marketplace aggregate retention amount.--
``(A) In general.--For purposes of paragraph (7),
the insurance marketplace aggregate retention amount
shall be the lesser of--
``(i) $27,500,000,000, as such amount is
revised pursuant to this paragraph; and
``(ii) the aggregate amount, for all insurers,
of insured losses during such calendar year.
``(B) <<NOTE: Effective dates.>> Revision of
insurance marketplace aggregate retention amount.--
``(i) Phase-in.--Beginning in the calendar
year of enactment of the Terrorism Risk Insurance
Program Reauthorization Act of 2015, the amount
set forth under subparagraph (A)(i) shall increase
by $2,000,000,000 per calendar year until equal to
$37,500,000,000.
``(ii) Further revision.--Beginning in the
calendar year that follows the calendar year in
which the amount set forth under subparagraph
(A)(i) is equal to $37,500,000,000, the amount
under subparagraph (A)(i) shall be revised to be
the amount equal to the annual average of the sum
of insurer deductibles for
[[Page 129 STAT. 5]]
all insurers participating in the Program for the
prior 3 calendar years, as such sum is determined
by the Secretary under subparagraph (C).
``(C) <<NOTE: Deadline.>> Rulemaking.--Not later
than 3 years after the date of enactment of the
Terrorism Risk Insurance Program Reauthorization Act of
2015, the Secretary shall--
``(i) <<NOTE: Determination.>> issue final
rules for determining the amount of the sum
described under subparagraph (B)(ii); and
``(ii) <<NOTE: Timeline. Public
information.>> provide a timeline for public
notification of such determination.''; and
(2) in paragraph (7)--
(A) in subparagraph (A)--
(i) in the matter preceding clause (i), by
striking ``for each of the periods referred to in
subparagraphs (A) through (E) of paragraph (6)'';
and
(ii) in clause (i), by striking ``for such
period'';
(B) by striking subparagraph (B) and inserting the
following:
``(B) [Reserved.]'';
(C) in subparagraph (C)--
(i) by striking ``occurring during any of the
periods referred to in any of subparagraphs (A)
through (E) of paragraph (6), terrorism loss risk-
spreading premiums in an amount equal to 133
percent'' and inserting ``, terrorism loss risk-
spreading premiums in an amount equal to 140
percent''; and
(ii) by inserting ``as calculated under
subparagraph (A)'' after ``mandatory recoupment
amount''; and
(D) in subparagraph (E)(i)--
(i) in subclause (I)--
(I) by striking ``2010'' and
inserting ``2017''; and
(II) by striking ``2012'' and
inserting ``2019'';
(ii) in subclause (II)--
(I) by striking ``2011'' and
inserting ``2018'';
(II) by striking ``2012'' and
inserting ``2019''; and
(III) by striking ``2017'' and
inserting ``2024''; and
(iii) in subclause (III)--
(I) by striking ``2012'' and
inserting ``2019''; and
(II) by striking ``2017'' and
inserting ``2024''.
SEC. 105. CERTIFICATION OF ACTS OF TERRORISM; CONSULTATION WITH
SECRETARY OF HOMELAND SECURITY.
Paragraph (1)(A) of section 102 (15 U.S.C. 6701 note) is amended in
the matter preceding clause (i), by striking ``concurrence with the
Secretary of State'' and inserting ``consultation with the Secretary of
Homeland Security''.
SEC. 106. TECHNICAL AMENDMENTS.
The Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is
amended--
(1) <<NOTE: 15 USC 6701 note.>> in section 102--
(A) in paragraph (3)--
(i) by redesignating subparagraphs (A), (B),
and (C) as clauses (i), (ii), and (iii),
respectively;
[[Page 129 STAT. 6]]
(ii) in the matter preceding clause (i) (as so
redesignated), by striking ``An entity has'' and
inserting the following:
``(A) In general.--An entity has''; and
(iii) by adding at the end the following new
subparagraph:
``(B) Rule of construction.--An entity, including
any affiliate thereof, does not have `control' over
another entity, if, as of the date of enactment of the
Terrorism Risk Insurance Program Reauthorization Act of
2015, the entity is acting as an attorney-in-fact, as
defined by the Secretary, for the other entity and such
other entity is a reciprocal insurer, provided that the
entity is not, for reasons other than the attorney-in-
fact relationship, defined as having `control' under
subparagraph (A).'';
(B) in paragraph (7)--
(i) by striking subparagraphs (A) through (F)
and inserting the following:
``(A) the value of an insurer's direct earned
premiums during the immediately preceding calendar year,
multiplied by 20 percent; and'';
(ii) by redesignating subparagraph (G) as
subparagraph (B); and
(iii) in subparagraph (B), as so redesignated
by clause (ii)--
(I) by striking ``notwithstanding
subparagraphs (A) through (F), for the
Transition Period or any Program Year''
and inserting ``notwithstanding
subparagraph (A), for any calendar
year''; and
(II) by striking ``Period or Program
Year'' and inserting ``calendar year'';
(C) by striking paragraph (11); and
(D) by redesignating paragraphs (12) through (16) as
paragraphs (11) through (15), respectively; and
(2) <<NOTE: 15 USC 6701 note.>> in section 103--
(A) in subsection (b)(2)--
(i) in subparagraph (B), by striking ``,
purchase,''; and
(ii) in subparagraph (C), by striking ``,
purchase,'';
(B) in subsection (c), by striking ``Program Year''
and inserting ``calendar year'';
(C) in subsection (e)--
(i) in paragraph (1)(A), as previously amended
by section 102--
(I) by striking ``the Transition
Period and each Program Year through
Program Year 4 shall be equal to 90
percent, and during Program Year 5 and
each Program Year thereafter'' and
inserting ``each calendar year'';
(II) by striking the comma after
``80 percent''; and
(III) by striking ``such Transition
Period or such Program Year'' and
inserting ``such calendar year'';
(ii) in paragraph (2)(A), by striking ``the
period beginning on the first day of the
Transition Period
[[Page 129 STAT. 7]]
and ending on the last day of Program Year 1, or
during any Program Year thereafter'' and inserting
``a calendar year''; and
(iii) in paragraph (3), by striking ``the
period beginning on the first day of the
Transition Period and ending on the last day of
Program Year 1, or during any other Program Year''
and inserting ``any calendar year''; and
(D) in subsection (g)(2)--
(i) by striking ``the Transition Period or a
Program Year'' each place that term appears and
inserting ``the calendar year'';
(ii) by striking ``such period'' and inserting
``the calendar year''; and
(iii) by striking ``that period'' and
inserting ``the calendar year''.
SEC. 107. IMPROVING THE CERTIFICATION PROCESS.
(a) Definitions.--As used in this section--
(1) the term ``act of terrorism'' has the same meaning as in
section 102(1) of the Terrorism Risk Insurance Act of 2002 (15
U.S.C. 6701 note);
(2) the term ``certification process'' means the process by
which the Secretary determines whether to certify an act as an
act of terrorism under section 102(1) of the Terrorism Risk
Insurance Act of 2002 (15 U.S.C. 6701 note); and
(3) the term ``Secretary'' means the Secretary of the
Treasury.
(b) Study.--Not later than 9 months after the date of enactment of
this Act, the Secretary shall conduct and complete a study on the
certification process.
(c) Required Content.--The study required under subsection (a) shall
include an examination and analysis of--
(1) the establishment of a reasonable timeline by which the
Secretary must make an accurate determination on whether to
certify an act as an act of terrorism;
(2) the impact that the length of any timeline proposed to
be established under paragraph (1) may have on the insurance
industry, policyholders, consumers, and taxpayers as a whole;
(3) the factors the Secretary would evaluate and monitor
during the certification process, including the ability of the
Secretary to obtain the required information regarding the
amount of projected and incurred losses resulting from an act
which the Secretary would need in determining whether to certify
the act as an act of terrorism;
(4) the appropriateness, efficiency, and effectiveness of
the consultation process required under section 102(1)(A) of the
Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) and
any recommendations on changes to the consultation process; and
(5) the ability of the Secretary to provide guidance and
updates to the public regarding any act that may reasonably be
certified as an act of terrorism.
(d) Report.--Upon completion of the study required under subsection
(a), the Secretary shall submit a report on the results of such study to
the Committee on Banking, Housing, and Urban
[[Page 129 STAT. 8]]
Affairs of the Senate and the Committee on Financial Services of the
House of Representatives.
(e) Rulemaking.--Section 102(1) of the Terrorism Risk Insurance Act
of 2002 (15 U.S.C. 6701 note) is amended--
(1) by redesignating subparagraph (D) as subparagraph (E);
and
(2) by inserting after subparagraph (C) the following:
``(D) <<NOTE: Deadline.>> Timing of
certification.--Not later than 9 months after the report
required under section 107 of the Terrorism Risk
Insurance Program Reauthorization Act of 2015 is
submitted to the appropriate committees of Congress, the
Secretary shall issue final rules governing the
certification process, including establishing a timeline
for which an act is eligible for certification by the
Secretary on whether an act is an act of terrorism under
this paragraph.''.
SEC. 108. GAO STUDY.
(a) Study.--Not later than 2 years after the date of enactment of
this Act, the Comptroller General of the United States shall complete a
study on the viability and effects of the Federal Government--
(1) <<NOTE: Assessment.>> assessing and collecting upfront
premiums on insurers that participate in the Terrorism Insurance
Program established under the Terrorism Risk Insurance Act of
2002 (15 U.S.C. 6701 note) (hereafter in this section referred
to as the ``Program''), which shall include a comparison of
practices in international markets to assess and collect
premiums either before or after terrorism losses are incurred;
and
(2) creating a capital reserve fund under the Program and
requiring insurers participating in the Program to dedicate
capital specifically for terrorism losses before such losses are
incurred, which shall include a comparison of practices in
international markets to establish reserve funds.
(b) Required Content.--The study required under subsection (a) shall
examine, but shall not be limited to, the following issues:
(1) Upfront premiums.--With respect to upfront premiums
described in subsection (a)(1)--
(A) how the Federal Government could determine the
price of such upfront premiums on insurers that
participate in the Program;
(B) how the Federal Government could collect and
manage such upfront premiums;
(C) how the Federal Government could ensure that
such upfront premiums are not spent for purposes other
than claims through the Program;
(D) how the assessment and collection of such
upfront premiums could affect take-up rates for
terrorism risk coverage in different regions and
industries and how it could impact small businesses and
consumers in both metropolitan and non-metropolitan
areas;
(E) the effect of collecting such upfront premiums
on insurers both large and small;
(F) the effect of collecting such upfront premiums
on the private market for terrorism risk reinsurance;
and
(G) the size of any Federal Government subsidy
insurers may receive through their participation in the
[[Page 129 STAT. 9]]
Program, taking into account the Program's current post-
event recoupment structure.
(2) Capital reserve fund.--With respect to the capital
reserve fund described in subsection (a)(2)--
(A) how the creation of a capital reserve fund would
affect the Federal Government's fiscal exposure under
the Terrorism Risk Insurance Program and the ability of
the Program to meet its statutory purposes;
(B) how a capital reserve fund would impact insurers
and reinsurers, including liquidity, insurance pricing,
and capacity to provide terrorism risk coverage;
(C) the feasibility of segregating funds
attributable to terrorism risk from funds attributable
to other insurance lines;
(D) how a capital reserve fund would be viewed and
treated under current Financial Accounting Standards
Board accounting rules and the tax laws; and
(E) how a capital reserve fund would affect the
States' ability to regulate insurers participating in
the Program.
(3) International practices.--With respect to international
markets referred to in paragraphs (1) and (2) of subsection (a),
how other countries, if any--
(A) have established terrorism insurance structures;
(B) charge premiums or otherwise collect funds to
pay for the costs of terrorism insurance structures,
including risk and administrative costs; and
(C) have established capital reserve funds to pay
for the costs of terrorism insurance structures.
(c) Report.--Upon completion of the study required under subsection
(a), the Comptroller General shall submit a report on the results of
such study to the Committee on Banking, Housing, and Urban Affairs of
the Senate and the Committee on Financial Services of the House of
Representatives.
(d) <<NOTE: Web posting.>> Public Availability.--The study and
report required under this section shall be made available to the public
in electronic form and shall be published on the website of the
Government Accountability Office.
SEC. 109. MEMBERSHIP OF BOARD OF GOVERNORS OF THE FEDERAL RESERVE
SYSTEM.
(a) <<NOTE: President. Appointment.>> In General.--The first
undesignated paragraph of section 10 of the Federal Reserve Act (12
U.S.C. 241) is amended by inserting after the second sentence the
following: ``In selecting members of the Board, the President shall
appoint at least 1 member with demonstrated primary experience working
in or supervising community banks having less than $10,000,000,000 in
total assets.''.
(b) <<NOTE: Applicability. 12 USC 241 note.>> Effective Date.--The
amendment made by this section shall take effect on the date of
enactment of this Act and apply to appointments made on and after that
effective date, excluding any nomination pending in the Senate on that
date.
SEC. 110. <<NOTE: 15 USC 6701 note.>> ADVISORY COMMITTEE ON RISK-
SHARING MECHANISMS.
(a) Finding; Rule of Construction.--
(1) Finding.--Congress finds that it is desirable to
encourage the growth of nongovernmental, private market
reinsurance capacity for protection against losses arising from
acts of terrorism.
[[Page 129 STAT. 10]]
(2) Rule of construction.--Nothing in this Act, any
amendment made by this Act, or the Terrorism Risk Insurance Act
of 2002 (15 U.S.C. 6701 note) shall prohibit insurers from
developing risk-sharing mechanisms to voluntarily reinsure
terrorism losses between and among themselves.
(b) Advisory Committee on Risk-Sharing Mechanisms.--
(1) Establishment.--The Secretary of the Treasury shall
establish and appoint an advisory committee to be known as the
``Advisory Committee on Risk-Sharing Mechanisms'' (referred to
in this subsection as the ``Advisory Committee'').
(2) Duties.--The Advisory Committee shall provide advice,
recommendations, and encouragement with respect to the creation
and development of the nongovernmental risk-sharing mechanisms
described under subsection (a).
(3) Membership.--The Advisory Committee shall be composed of
9 members who are directors, officers, or other employees of
insurers, reinsurers, or capital market participants that are
participating or that desire to participate in the
nongovernmental risk-sharing mechanisms described under
subsection (a), and who are representative of the affected
sectors of the insurance industry, including commercial property
insurance, commercial casualty insurance, reinsurance, and
alternative risk transfer industries.
SEC. 111. REPORTING OF TERRORISM INSURANCE DATA.
Section 104 (15 U.S.C. 6701 note) is amended by adding at the end
the following new subsection:
``(h) Reporting of Terrorism Insurance Data.--
``(1) <<NOTE: Time period. Effective date.>> Authority.--
During the calendar year beginning on January 1, 2016, and in
each calendar year thereafter, the Secretary shall require
insurers participating in the Program to submit to the Secretary
such information regarding insurance coverage for terrorism
losses of such insurers as the Secretary considers appropriate
to analyze the effectiveness of the Program, which shall include
information regarding--
``(A) lines of insurance with exposure to such
losses;
``(B) premiums earned on such coverage;
``(C) geographical location of exposures;
``(D) pricing of such coverage;
``(E) the take-up rate for such coverage;
``(F) the amount of private reinsurance for acts of
terrorism purchased; and
``(G) such other matters as the Secretary considers
appropriate.
``(2) Reports.--Not later than June 30, 2016, and every
other June 30 thereafter, the Secretary shall submit a report to
the Committee on Financial Services of the House of
Representatives and the Committee on Banking, Housing, and Urban
Affairs of the Senate that includes--
``(A) an analysis of the overall effectiveness of
the Program;
``(B) an evaluation of any changes or trends in the
data collected under paragraph (1);
``(C) an evaluation of whether any aspects of the
Program have the effect of discouraging or impeding
insurers from providing commercial property casualty
insurance coverage or coverage for acts of terrorism;
[[Page 129 STAT. 11]]
``(D) an evaluation of the impact of the Program on
workers' compensation insurers; and
``(E) in the case of the data reported in paragraph
(1)(B), an updated estimate of the total amount earned
since January 1, 2003.
``(3) <<NOTE: Contracts. Confidentiality.>> Protection of
data.--To the extent possible, the Secretary shall contract with
an insurance statistical aggregator to collect the information
described in paragraph (1), which shall keep any nonpublic
information confidential and provide it to the Secretary in an
aggregate form or in such other form or manner that does not
permit identification of the insurer submitting such
information.
``(4) <<NOTE: Determinations.>> Advance coordination.--
Before collecting any data or information under paragraph (1)
from an insurer, or affiliate of an insurer, the Secretary shall
coordinate with the appropriate State insurance regulatory
authorities and any relevant government agency or publicly
available sources to determine if the information to be
collected is available from, and may be obtained in a timely
manner by, individually or collectively, such entities. If the
Secretary determines that such data or information is available,
and may be obtained in a timely matter, from such entities, the
Secretary shall obtain the data or information from such
entities. If the Secretary determines that such data or
information is not so available, the Secretary may collect such
data or information from an insurer and affiliates.
``(5) Confidentiality.--
``(A) Retention of privilege.--The submission of any
non-publicly available data and information to the
Secretary and the sharing of any non-publicly available
data with or by the Secretary among other Federal
agencies, the State insurance regulatory authorities, or
any other entities under this subsection shall not
constitute a waiver of, or otherwise affect, any
privilege arising under Federal or State law (including
the rules of any Federal or State court) to which the
data or information is otherwise subject.
``(B) Continued application of prior confidentiality
agreements.--Any requirement under Federal or State law
to the extent otherwise applicable, or any requirement
pursuant to a written agreement in effect between the
original source of any non-publicly available data or
information and the source of such data or information
to the Secretary, regarding the privacy or
confidentiality of any data or information in the
possession of the source to the Secretary, shall
continue to apply to such data or information after the
data or information has been provided pursuant to this
subsection.
``(C) Information-sharing agreement.--Any data or
information obtained by the Secretary under this
subsection may be made available to State insurance
regulatory authorities, individually or collectively
through an information-sharing agreement that--
``(i) <<NOTE: Compliance.>> shall comply with
applicable Federal law; and
``(ii) shall not constitute a waiver of, or
otherwise affect, any privilege under Federal or
State law (including any privilege referred to in
subparagraph
[[Page 129 STAT. 12]]
(A) and the rules of any Federal or State court)
to which the data or information is otherwise
subject.
``(D) <<NOTE: Applicability.>> Agency disclosure
requirements.--Section 552 of title 5, United States
Code, including any exceptions thereunder, shall apply
to any data or information submitted under this
subsection to the Secretary by an insurer or affiliate
of an insurer.''.
SEC. 112. ANNUAL STUDY OF SMALL INSURER MARKET COMPETITIVENESS.
Section 108 (15 U.S.C. 6701 note) is amended by adding at the end
the following new subsection:
``(h) Study of Small Insurer Market Competitiveness.--
``(1) In general.--Not later than June 30, 2017, and every
other June 30 thereafter, the Secretary shall conduct a study of
small insurers (as such term is defined by regulation by the
Secretary) participating in the Program, and identify any
competitive challenges small insurers face in the terrorism risk
insurance marketplace, including--
``(A) changes to the market share, premium volume,
and policyholder surplus of small insurers relative to
large insurers;
``(B) how the property and casualty insurance market
for terrorism risk differs between small and large
insurers, and whether such a difference exists within
other perils;
``(C) the impact of the Program's mandatory
availability requirement under section 103(c) on small
insurers;
``(D) the effect of increasing the trigger amount
for the Program under section 103(e)(1)(B) on small
insurers;
``(E) the availability and cost of private
reinsurance for small insurers; and
``(F) the impact that State workers compensation
laws have on small insurers and workers compensation
carriers in the terrorism risk insurance marketplace.
``(2) Report.--The Secretary shall submit a report to the
Congress setting forth the findings and conclusions of each
study required under paragraph (1).''.
TITLE <<NOTE: National Association of Registered Agents and Brokers
Reform Act of 2015.>> II--NATIONAL ASSOCIATION OF REGISTERED AGENTS AND
BROKERS REFORM
SEC. 201. <<NOTE: 15 USC 6701 note.>> SHORT TITLE.
This title may be cited as the ``National Association of Registered
Agents and Brokers Reform Act of 2015''.
SEC. 202. REESTABLISHMENT OF THE NATIONAL ASSOCIATION OF
REGISTERED AGENTS AND BROKERS.
(a) In General.--Subtitle C of title III of the Gramm-Leach-Bliley
Act (15 U.S.C. 6751 et seq.) is amended to read as follows:
[[Page 129 STAT. 13]]
``Subtitle C--National Association of Registered Agents and Brokers
``SEC. 321. <<NOTE: 15 USC 6751.>> NATIONAL ASSOCIATION OF
REGISTERED AGENTS AND BROKERS.
``(a) Establishment.--There is established the National Association
of Registered Agents and Brokers (referred to in this subtitle as the
`Association').
``(b) Status.--The Association shall--
``(1) be a nonprofit corporation;
``(2) not be an agent or instrumentality of the Federal
Government;
``(3) be an independent organization that may not be merged
with or into any other private or public entity; and
``(4) except as otherwise provided in this subtitle, be
subject to, and have all the powers conferred upon, a nonprofit
corporation by the District of Columbia Nonprofit Corporation
Act (D.C. Code, sec. 29-301.01 et seq.) or any successor
thereto.
``SEC. <<NOTE: 15 USC 6752.>> 322. PURPOSE.
``The purpose of the Association shall be to provide a mechanism
through which licensing, continuing education, and other nonresident
insurance producer qualification requirements and conditions may be
adopted and applied on a multi-state basis without affecting the laws,
rules, and regulations, and preserving the rights of a State, pertaining
to--
``(1) licensing, continuing education, and other
qualification requirements of insurance producers that are not
members of the Association;
``(2) resident or nonresident insurance producer appointment
requirements;
``(3) supervising and disciplining resident and nonresident
insurance producers;
``(4) establishing licensing fees for resident and
nonresident insurance producers so that there is no loss of
insurance producer licensing revenue to the State; and
``(5) prescribing and enforcing laws and regulations
regulating the conduct of resident and nonresident insurance
producers.
``SEC. <<NOTE: 15 USC 6753.>> 323. MEMBERSHIP.
``(a) Eligibility.--
``(1) In general.--Any insurance producer licensed in its
home State shall, subject to paragraphs (2) and (4), be eligible
to become a member of the Association.
``(2) Ineligibility for suspension or revocation of
license.--Subject to paragraph (3), an insurance producer is not
eligible to become a member of the Association if a State
insurance regulator has suspended or revoked the insurance
license of the insurance producer in that State.
``(3) Resumption of eligibility.--Paragraph (2) shall cease
to apply to any insurance producer if--
``(A) the State insurance regulator reissues or
renews the license of the insurance producer in the
State in which the license was suspended or revoked, or
otherwise terminates or vacates the suspension or
revocation; or
[[Page 129 STAT. 14]]
``(B) the suspension or revocation expires or is
subsequently overturned by a court of competent
jurisdiction.
``(4) Criminal history record check required.--
``(A) In general.--An insurance producer who is an
individual shall not be eligible to become a member of
the Association unless the insurance producer has
undergone a criminal history record check that complies
with regulations prescribed by the Attorney General of
the United States under subparagraph (K).
``(B) Criminal history record check requested by
home state.--An insurance producer <<NOTE: Time
period.>> who is licensed in a State and who has
undergone a criminal history record check during the 2-
year period preceding the date of submission of an
application to become a member of the Association, in
compliance with a requirement to undergo such criminal
history record check as a condition for such licensure
in the State, shall be deemed to have undergone a
criminal history record check for purposes of
subparagraph (A).
``(C) Criminal history record check requested by
association.--
``(i) In general.--The Association shall, upon
request by an insurance producer licensed in a
State, submit fingerprints or other identification
information obtained from the insurance producer,
and a request for a criminal history record check
of the insurance producer, to the Federal Bureau
of Investigation.
``(ii) Procedures.--The board of directors of
the Association (referred to in this subtitle as
the `Board') shall prescribe procedures for
obtaining and utilizing fingerprints or other
identification information and criminal history
record information, including the establishment of
reasonable fees to defray the expenses of the
Association in connection with the performance of
a criminal history record check and appropriate
safeguards for maintaining confidentiality and
security of the information. Any fees charged
pursuant to this clause shall be separate and
distinct from those charged by the Attorney
General pursuant to subparagraph (I).
``(D) Form of request.--A submission under
subparagraph (C)(i) shall include such fingerprints or
other identification information as is required by the
Attorney General concerning the person about whom the
criminal history record check is requested, and a
statement signed by the person authorizing the Attorney
General to provide the information to the Association
and for the Association to receive the information.
``(E) Provision of information by attorney
general.--Upon receiving a submission under subparagraph
(C)(i) from the Association, the Attorney General shall
search all criminal history records of the Federal
Bureau of Investigation, including records of the
Criminal Justice Information Services Division of the
Federal Bureau of Investigation, that the Attorney
General determines appropriate for criminal history
records corresponding to the fingerprints or other
identification information provided
[[Page 129 STAT. 15]]
under subparagraph (D) and provide all criminal history
record information included in the request to the
Association.
``(F) Limitation on permissible uses of
information.--Any information provided to the
Association under subparagraph (E) may only--
``(i) be used for purposes of determining
compliance with membership criteria established by
the Association;
``(ii) be disclosed to State insurance
regulators, or Federal or State law enforcement
agencies, in conformance with applicable law; or
``(iii) be disclosed, upon request, to the
insurance producer to whom the criminal history
record information relates.
``(G) Penalty for improper use or disclosure.--
Whoever knowingly uses any information provided under
subparagraph (E) for a purpose not authorized in
subparagraph (F), or discloses any such information to
anyone not authorized to receive it, shall be fined not
more than $50,000 per violation as determined by a court
of competent jurisdiction.
``(H) Reliance on information.--Neither the
Association nor any of its Board members, officers, or
employees shall be liable in any action for using
information provided under subparagraph (E) as permitted
under subparagraph (F) in good faith and in reasonable
reliance on its accuracy.
``(I) Fees.--The Attorney General may charge a
reasonable fee for conducting the search and providing
the information under subparagraph (E), and any such fee
shall be collected and remitted by the Association to
the Attorney General.
``(J) Rule of construction.--Nothing in this
paragraph shall be construed as--
``(i) requiring a State insurance regulator to
perform criminal history record checks under this
section; or
``(ii) limiting any other authority that
allows access to criminal history records.
``(K) Regulations.--The Attorney General shall
prescribe regulations to carry out this paragraph, which
shall include--
``(i) appropriate protections for ensuring the
confidentiality of information provided under
subparagraph (E); and
``(ii) <<NOTE: Procedures.>> procedures
providing a reasonable opportunity for an
insurance producer to contest the accuracy of
information regarding the insurance producer
provided under subparagraph (E).
``(L) Ineligibility for membership.--
``(i) In general.--The Association may, under
reasonably consistently applied standards, deny
membership to an insurance producer on the basis
of criminal history record information provided
under subparagraph (E), or where the insurance
producer has been subject to disciplinary action,
as described in paragraph (2).
[[Page 129 STAT. 16]]
``(ii) Rights of applicants denied
membership.--The
Association <<NOTE: Notification.>> shall notify
any insurance producer who is denied membership on
the basis of criminal history record information
provided under subparagraph (E) of the right of
the insurance producer to--
``(I) obtain a copy of all criminal
history record information provided to
the Association under subparagraph (E)
with respect to the insurance producer;
and
``(II) challenge the denial of
membership based on the accuracy and
completeness of the information.
``(M) Definition.--For purposes of this paragraph,
the term `criminal history record check' means a
national background check of criminal history records of
the Federal Bureau of Investigation.
``(b) Authority To Establish Membership Criteria.--The Association
may establish membership criteria that bear a reasonable relationship to
the purposes for which the Association was established.
``(c) Establishment of Classes and Categories of Membership.--
``(1) Classes of membership.--The Association may establish
separate classes of membership, with separate criteria, if the
Association reasonably determines that performance of different
duties requires different levels of education, training,
experience, or other qualifications.
``(2) Business entities.--The Association shall establish a
class of membership and membership criteria for business
entities. A business entity that applies for membership shall be
required to designate an individual Association member
responsible for the compliance of the business entity with
Association standards and the insurance laws, standards, and
regulations of any State in which the business entity seeks to
do business on the basis of Association membership.
``(3) Categories.--
``(A) Separate categories for insurance producers
permitted.--The Association may establish separate
categories of membership for insurance producers and for
other persons or entities within each class, based on
the types of licensing categories that exist under State
laws.
``(B) Separate treatment for depository institutions
prohibited.--No special categories of membership, and no
distinct membership criteria, shall be established for
members that are depository institutions or for
employees, agents, or affiliates of depository
institutions.
``(d) Membership Criteria.--
``(1) In general.--The Association may establish criteria
for membership which shall include standards for personal
qualifications, education, training, and experience. The
Association shall not establish criteria that unfairly limit the
ability of a small insurance producer to become a member of the
Association, including imposing discriminatory membership fees.
``(2) Qualifications.--In establishing criteria under
paragraph (1), the Association shall not adopt any qualification
less protective to the public than that contained in the
National
[[Page 129 STAT. 17]]
Association of Insurance Commissioners (referred to in this
subtitle as the `NAIC') Producer Licensing Model Act in effect
as of the date of enactment of the National Association of
Registered Agents and Brokers Reform Act of 2015, and shall
consider the highest levels of insurance producer qualifications
established under the licensing laws of the States.
``(3) Assistance from states.--
``(A) In general.--The Association may request a
State to provide assistance in investigating and
evaluating the eligibility of a prospective member for
membership in the Association.
``(B) Authorization of information sharing.--A
submission under subsection (a)(4)(C)(i) made by an
insurance producer licensed in a State shall include a
statement signed by the person about whom the assistance
is requested authorizing--
``(i) the State to share information with the
Association; and
``(ii) the Association to receive the
information.
``(C) Rule of construction.--Subparagraph (A) shall
not be construed as requiring or authorizing any State
to adopt new or additional requirements concerning the
licensing or evaluation of insurance producers.
``(4) Denial of membership.--The Association may, based on
reasonably consistently applied standards, deny membership to
any State-licensed insurance producer for failure to meet the
membership criteria established by the Association.
``(e) Effect of Membership.--
``(1) Authority of association members.--Membership in the
Association shall--
``(A) authorize an insurance producer to sell,
solicit, or negotiate insurance in any State for which
the member pays the licensing fee set by the State for
any line or lines of insurance specified in the home
State license of the insurance producer, and exercise
all such incidental powers as shall be necessary to
carry out such activities, including claims adjustments
and settlement to the extent permissible under the laws
of the State, risk management, employee benefits advice,
retirement planning, and any other insurance-related
consulting activities;
``(B) be the equivalent of a nonresident insurance
producer license for purposes of authorizing the
insurance producer to engage in the activities described
in subparagraph (A) in any State where the member pays
the licensing fee; and
``(C) be the equivalent of a nonresident insurance
producer license for the purpose of subjecting an
insurance producer to all laws, regulations, provisions
or other action of any State concerning revocation,
suspension, or other enforcement action related to the
ability of a member to engage in any activity within the
scope of authority granted under this subsection and to
all State laws, regulations, provisions, and actions
preserved under paragraph (5).
``(2) Violent crime control and law enforcement act of
1994.--Nothing in this subtitle shall be construed to alter,
modify, or supercede any requirement established by section 1033
of title 18, United States Code.
[[Page 129 STAT. 18]]
``(3) Agent for remitting fees.--The Association shall act
as an agent for any member for purposes of remitting licensing
fees to any State pursuant to paragraph (1).
``(4) Notification of action.--
``(A) In general.--The Association shall notify the
States (including State insurance regulators) and the
NAIC when an insurance producer has satisfied the
membership criteria of this section. <<NOTE: State and
local governments. Deadline.>> The States (including
State insurance regulators) shall have 10 business days
after the date of the notification in order to provide
the Association with evidence that the insurance
producer does not satisfy the criteria for membership in
the Association.
``(B) Ongoing disclosures required.--On an ongoing
basis, the Association shall disclose to the States
(including State insurance regulators) and the NAIC a
list of the States in which each member is authorized to
operate. The Association shall immediately notify the
States (including State insurance regulators) and the
NAIC when a member is newly authorized to operate in one
or more States, or is no longer authorized to operate in
one or more States on the basis of Association
membership.
``(5) Preservation of consumer protection and market conduct
regulation.--
``(A) In general.--No provision of this section
shall be construed as altering or affecting the
applicability or continuing effectiveness of any law,
regulation, provision, or other action of any State,
including those described in subparagraph (B), to the
extent that the State law, regulation, provision, or
other action is not inconsistent with the provisions of
this subtitle related to market entry for nonresident
insurance producers, and then only to the extent of the
inconsistency.
``(B) Preserved regulations.--The laws, regulations,
provisions, or other actions of any State referred to in
subparagraph (A) include laws, regulations, provisions,
or other actions that--
``(i) regulate market conduct, insurance
producer conduct, or unfair trade practices;
``(ii) establish consumer protections; or
``(iii) require insurance producers to be
appointed by a licensed or authorized insurer.
``(f) Biennial Renewal.--Membership in the Association shall be
renewed on a biennial basis.
``(g) Continuing Education.--
``(1) In general.--The Association shall establish, as a
condition of membership, continuing education requirements which
shall be comparable to the continuing education requirements
under the licensing laws of a majority of the States.
``(2) State continuing education requirements.--A member may
not be required to satisfy continuing education requirements
imposed under the laws, regulations, provisions, or actions of
any State other than the home State of the member.
``(3) Reciprocity.--The Association shall not require a
member to satisfy continuing education requirements that are
equivalent to any continuing education requirements of the
[[Page 129 STAT. 19]]
home State of the member that have been satisfied by the member
during the applicable licensing period.
``(4) Limitation on the association.--The Association shall
not directly or indirectly offer any continuing education
courses for insurance producers.
``(h) Probation, Suspension and Revocation.--
``(1) Disciplinary action.--The Association may place an
insurance producer that is a member of the Association on
probation or suspend or revoke the membership of the insurance
producer in the Association, or assess monetary fines or
penalties, as the Association determines to be appropriate, if--
``(A) the insurance producer fails to meet the
applicable membership criteria or other standards
established by the Association;
``(B) the insurance producer has been subject to
disciplinary action pursuant to a final adjudicatory
proceeding under the jurisdiction of a State insurance
regulator;
``(C) an insurance license held by the insurance
producer has been suspended or revoked by a State
insurance regulator; or
``(D) the insurance producer has been convicted of a
crime that would have resulted in the denial of
membership pursuant to subsection (a)(4)(L)(i) at the
time of application, and the Association has received a
copy of the final disposition from a court of competent
jurisdiction.
``(2) Violations of association standards.--The Association
shall have the power to investigate alleged violations of
Association standards.
``(3) <<NOTE: Notification.>> Reporting.--The Association
shall immediately notify the States (including State insurance
regulators) and the NAIC when the membership of an insurance
producer has been placed on probation or has been suspended,
revoked, or otherwise terminated, or when the Association has
assessed monetary fines or penalties.
``(i) Consumer Complaints.--
``(1) In general.--The Association shall--
``(A) refer any complaint against a member of the
Association from a consumer relating to alleged
misconduct or violations of State insurance laws to the
State insurance regulator where the consumer resides
and, when appropriate, to any additional State insurance
regulator, as determined by standards adopted by the
Association; and
``(B) make any related records and information
available to each State insurance regulator to whom the
complaint is forwarded.
``(2) Telephone and other access.--The Association shall
maintain a toll-free number for purposes of this subsection and,
as practicable, other alternative means of communication with
consumers, such as an Internet webpage.
``(3) Final disposition of investigation.--State insurance
regulators shall provide the Association with information
regarding the final disposition of a complaint referred pursuant
to paragraph (1)(A), but nothing shall be construed to compel a
State to release confidential investigation reports or other
information protected by State law to the Association.
``(j) Information Sharing.--The Association may--
[[Page 129 STAT. 20]]
``(1) share documents, materials, or other information,
including confidential and privileged documents, with a State,
Federal, or international governmental entity or with the NAIC
or other appropriate entity referred to paragraphs (3) and (4),
provided that the recipient has the authority and agrees to
maintain the confidentiality or privileged status of the
document, material, or other information;
``(2) limit the sharing of information as required under
this subtitle with the NAIC or any other non-governmental
entity, in circumstances under which the Association determines
that the sharing of such information is unnecessary to further
the purposes of this subtitle;
``(3) establish a central clearinghouse, or utilize the NAIC
or another appropriate entity, as determined by the Association,
as a central clearinghouse, for use by the Association and the
States (including State insurance regulators), through which
members of the Association may disclose their intent to operate
in 1 or more States and pay the licensing fees to the
appropriate States; and
``(4) establish a database, or utilize the NAIC or another
appropriate entity, as determined by the Association, as a
database, for use by the Association and the States (including
State insurance regulators) for the collection of regulatory
information concerning the activities of insurance producers.
``(k) Effective Date.--The provisions of this section shall take
effect on the later of--
``(1) <<NOTE: Time period.>> the expiration of the 2-year
period beginning on the date of enactment of the National
Association of Registered Agents and Brokers Reform Act of 2015;
and
``(2) the date of incorporation of the Association.
``SEC. 324. <<NOTE: 15 USC 6754.>> BOARD OF DIRECTORS.
``(a) Establishment.--There is established a board of directors of
the Association, which shall have authority to govern and supervise all
activities of the Association.
``(b) Powers.--The Board shall have such of the powers and authority
of the Association as may be specified in the bylaws of the Association.
``(c) Composition.--
``(1) <<NOTE: President. Appointments.>> In general.--The
Board shall consist of 13 members who shall be appointed by the
President, by and with the advice and consent of the Senate, in
accordance with the procedures established under Senate
Resolution 116 of the 112th Congress, of whom--
``(A) 8 shall be State insurance commissioners
appointed in the manner provided in paragraph (2), 1 of
whom shall be designated by the President to serve as
the chairperson of the Board until the Board elects one
such State insurance commissioner Board member to serve
as the chairperson of the Board;
``(B) 3 shall have demonstrated expertise and
experience with property and casualty insurance producer
licensing; and
``(C) 2 shall have demonstrated expertise and
experience with life or health insurance producer
licensing.
``(2) State insurance regulator representatives.--
[[Page 129 STAT. 21]]
``(A) <<NOTE: President.>> Recommendations.--Before
making any appointments pursuant to paragraph (1)(A),
the President shall request a list of recommended
candidates from the States through the NAIC, which shall
not be binding on the President. If the
NAIC <<NOTE: Deadline.>> fails to submit a list of
recommendations not later than 15 business days after
the date of the request, the President may make the
requisite appointments without considering the views of
the NAIC.
``(B) Political affiliation.--Not more than 4 Board
members appointed under paragraph (1)(A) shall belong to
the same political party.
``(C) Former state insurance commissioners.--
``(i) In general.--If, after offering each
currently serving State insurance commissioner an
appointment to the Board, fewer than 8 State
insurance commissioners have accepted appointment
to the Board, the President may appoint the
remaining State insurance commissioner Board
members, as required under paragraph (1)(A), of
the appropriate political party as required under
subparagraph (B), from among individuals who are
former State insurance commissioners.
``(ii) Limitation.--A former State insurance
commissioner appointed as described in clause (i)
may not be employed by or have any present direct
or indirect financial interest in any insurer,
insurance producer, or other entity in the
insurance industry, other than direct or indirect
ownership of, or beneficial interest in, an
insurance policy or annuity contract written or
sold by an insurer.
``(D) Service through term.--If a Board member
appointed under paragraph (1)(A) ceases to be a State
insurance commissioner during the term of the Board
member, the Board member shall cease to be a Board
member.
``(3) Private sector representatives.--In making any
appointment pursuant to subparagraph (B) or (C) of paragraph
(1), the President may seek recommendations for candidates from
groups representing the category of individuals described, which
shall not be binding on the President.
``(4) State insurance commissioner defined.--For purposes of
this subsection, the term `State insurance commissioner' means a
person who serves in the position in State government, or on the
board, commission, or other body that is the primary insurance
regulatory authority for the State.
``(d) Terms.--
``(1) In general.--Except as provided under paragraph (2),
the term of service for each Board member shall be 2 years.
``(2) Exceptions.--
``(A) <<NOTE: President.>> 1-year terms.--The term
of service shall be 1 year, as designated by the
President at the time of the nomination of the subject
Board members for--
``(i) 4 of the State insurance commissioner
Board members initially appointed under paragraph
(1)(A), of whom not more than 2 shall belong to
the same political party;
[[Page 129 STAT. 22]]
``(ii) 1 of the Board members initially
appointed under paragraph (1)(B); and
``(iii) 1 of the Board members initially
appointed under paragraph (1)(C).
``(B) Expiration of term.--A Board member may
continue to serve after the expiration of the term to
which the Board member was appointed for the earlier of
2 years or until a successor is appointed.
``(C) Mid-term appointments.--A Board member
appointed to fill a vacancy occurring before the
expiration of the term for which the predecessor of the
Board member was appointed shall be appointed only for
the remainder of that term.
``(3) Successive terms.--Board members may be reappointed to
successive terms.
``(e) <<NOTE: Deadline.>> Initial Appointments.--The appointment of
initial Board members shall be made no later than 90 days after the date
of enactment of the National Association of Registered Agents and
Brokers Reform Act of 2015.
``(f) Meetings.--
``(1) In general.--The Board shall meet--
``(A) at the call of the chairperson;
``(B) <<NOTE: Notification.>> as requested in
writing to the chairperson by not fewer than 5 Board
members; or
``(C) as otherwise provided by the bylaws of the
Association.
``(2) Quorum required.--A majority of all Board members
shall constitute a quorum.
``(3) Voting.--Decisions of the Board shall require the
approval of a majority of all Board members present at a
meeting, a quorum being present.
``(4) <<NOTE: Deadline.>> Initial meeting.--The Board shall
hold its first meeting not later than 45 days after the date on
which all initial Board members have been appointed.
``(g) Restriction on Confidential Information.--Board members
appointed pursuant to subparagraphs (B) and (C) of subsection (c)(1)
shall not have access to confidential information received by the
Association in connection with complaints, investigations, or
disciplinary proceedings involving insurance producers.
``(h) Ethics and Conflicts of Interest.--The Board shall issue and
enforce an ethical conduct code to address permissible and prohibited
activities of Board members and Association officers, employees, agents,
or consultants. The code shall, at a minimum, include provisions that
prohibit any Board member or Association officer, employee, agent or
consultant from--
``(1) engaging in unethical conduct in the course of
performing Association duties;
``(2) participating in the making or influencing the making
of any Association decision, the outcome of which the Board
member, officer, employee, agent, or consultant knows or had
reason to know would have a reasonably foreseeable material
financial effect, distinguishable from its effect on the public
generally, on the person or a member of the immediate family of
the person;
``(3) accepting any gift from any person or entity other
than the Association that is given because of the position held
by the person in the Association;
[[Page 129 STAT. 23]]
``(4) making political contributions to any person or entity
on behalf of the Association; and
``(5) lobbying or paying a person to lobby on behalf of the
Association.
``(i) Compensation.--
``(1) In general.--Except as provided in paragraph (2), no
Board member may receive any compensation from the Association
or any other person or entity on account of Board membership.
``(2) Travel expenses and per diem.--Board members may be
reimbursed only by the Association for travel expenses,
including per diem in lieu of subsistence, at rates consistent
with rates authorized for employees of Federal agencies under
subchapter I of chapter 57 of title 5, United States Code, while
away from home or regular places of business in performance of
services for the Association.
``SEC. 325. <<NOTE: 15 USC 6755.>> BYLAWS, STANDARDS, AND
DISCIPLINARY ACTIONS.
``(a) Adoption and Amendment of Bylaws and Standards.--
``(1) Procedures.--The Association shall adopt procedures
for the adoption of bylaws and standards that are similar to
procedures under subchapter II of chapter 5 of title 5, United
States Code (commonly known as the `Administrative Procedure
Act').
``(2) <<NOTE: Web posting.>> Copy required to be filed.--
The Board shall submit to the President, through the Department
of the Treasury, and the States (including State insurance
regulators), and shall publish on the website of the
Association, all proposed bylaws and standards of the
Association, or any proposed amendment to the bylaws or
standards of the Association, accompanied by a concise general
statement of the basis and purpose of such proposal.
``(3) Effective date.--Any proposed bylaw or standard of the
Association, and any proposed amendment to the bylaws or
standards of the Association, shall take effect, after notice
under paragraph (2) and opportunity for public comment, on such
date as the Association may designate, unless suspended under
section 329(c).
``(4) Rule of construction.--Nothing in this section shall
be construed to subject the Board or the Association to the
requirements of subchapter II of chapter 5 of title 5, United
States Code (commonly known as the `Administrative Procedure
Act').
``(b) Disciplinary Action by the Association.--
``(1) <<NOTE: Notification. Records.>> Specification of
charges.--In any proceeding to determine whether membership
shall be denied, suspended, revoked, or not renewed, or to
determine whether a member of the Association should be placed
on probation (referred to in this section as a `disciplinary
action') or whether to assess fines or monetary penalties, the
Association shall bring specific charges, notify the member of
the charges, give the member an opportunity to defend against
the charges, and keep a record.
``(2) <<NOTE: Determination.>> Supporting statement.--A
determination to take disciplinary action shall be supported by
a statement setting forth--
``(A) any act or practice in which the member has
been found to have been engaged;
[[Page 129 STAT. 24]]
``(B) the specific provision of this subtitle or
standard of the Association that any such act or
practice is deemed to violate; and
``(C) the sanction imposed and the reason for the
sanction.
``(3) Ineligibility of private sector representatives.--
Board members appointed pursuant to section 324(c)(3) may not--
``(A) participate in any disciplinary action or be
counted toward establishing a quorum during a
disciplinary action; and
``(B) have access to confidential information
concerning any disciplinary action.
``SEC. <<NOTE: 15 USC 6756.>> 326. POWERS.
``In addition to all the powers conferred upon a nonprofit
corporation by the District of Columbia Nonprofit Corporation Act, the
Association shall have the power to--
``(1) establish and collect such membership fees as the
Association finds necessary to impose to cover the costs of its
operations;
``(2) adopt, amend, and repeal bylaws, procedures, or
standards governing the conduct of Association business and
performance of its duties;
``(3) establish procedures for providing notice and
opportunity for comment pursuant to section 325(a);
``(4) enter into and perform such agreements as necessary to
carry out the duties of the Association;
``(5) hire employees, professionals, or specialists, and
elect or appoint officers, and to fix their compensation, define
their duties and give them appropriate authority to carry out
the purposes of this subtitle, and determine their
qualification;
``(6) establish personnel policies of the Association and
programs relating to, among other things, conflicts of interest,
rates of compensation, where applicable, and qualifications of
personnel;
``(7) borrow money; and
``(8) secure funding for such amounts as the Association
determines to be necessary and appropriate to organize and begin
operations of the Association, which shall be treated as loans
to be repaid by the Association with interest at market rate.
``SEC. 327. <<NOTE: 15 USC 6757.>> REPORT BY THE ASSOCIATION.
``(a) <<NOTE: Web posting.>> In General.--As soon as practicable
after the close of each fiscal year, the Association shall submit to the
President, through the Department of the Treasury, and the States
(including State insurance regulators), and shall publish on the website
of the Association, a written report regarding the conduct of its
business, and the exercise of the other rights and powers granted by
this subtitle, during such fiscal year.
``(b) Financial Statements.--Each report submitted under subsection
(a) with respect to any fiscal year shall include audited financial
statements setting forth the financial position of the Association at
the end of such fiscal year and the results of its operations (including
the source and application of its funds) for such fiscal year.
[[Page 129 STAT. 25]]
``SEC. 328. <<NOTE: 15 USC 6758.>> LIABILITY OF THE ASSOCIATION
AND THE BOARD MEMBERS, OFFICERS, AND
EMPLOYEES OF THE ASSOCIATION.
``(a) In General.--The Association shall not be deemed to be an
insurer or insurance producer within the meaning of any State law, rule,
regulation, or order regulating or taxing insurers, insurance producers,
or other entities engaged in the business of insurance, including
provisions imposing premium taxes, regulating insurer solvency or
financial condition, establishing guaranty funds and levying
assessments, or requiring claims settlement practices.
``(b) Liability of Board Members, Officers, and Employees.--No Board
member, officer, or employee of the Association shall be personally
liable to any person for any action taken or omitted in good faith in
any matter within the scope of their responsibilities in connection with
the Association.
``SEC. 329. <<NOTE: 15 USC 6759.>> PRESIDENTIAL OVERSIGHT.
``(a) <<NOTE: Determination.>> Removal of Board.--If the President
determines that the Association is acting in a manner contrary to the
interests of the public or the purposes of this subtitle or has failed
to perform its duties under this subtitle, the President may remove the
entire existing Board for the remainder of the term to which the Board
members were appointed and appoint, in accordance with section 324 and
with the advice and consent of the Senate, in accordance with the
procedures established under Senate Resolution 116 of the 112th
Congress, new Board members to fill the vacancies on the Board for the
remainder of the terms.
``(b) Removal of Board Member.--The President may remove a Board
member only for neglect of duty or malfeasance in office.
``(c) Suspension of Bylaws and Standards and Prohibition of
Actions.--Following notice <<NOTE: Notification.>> to the Board, the
President, or a person designated by the President for such purpose, may
suspend the effectiveness of any bylaw or standard, or prohibit any
action, of the Association that the President or the designee determines
is contrary to the purposes of this subtitle.
``SEC. 330. <<NOTE: 15 USC 6760.>> RELATIONSHIP TO STATE LAW.
``(a) Preemption of State Laws.--State laws, regulations,
provisions, or other actions purporting to regulate insurance producers
shall be preempted to the extent provided in subsection (b).
``(b) Prohibited Actions.--
``(1) In general.--No State shall--
``(A) impede the activities of, take any action
against, or apply any provision of law or regulation
arbitrarily or discriminatorily to, any insurance
producer because that insurance producer or any
affiliate plans to become, has applied to become, or is
a member of the Association;
``(B) impose any requirement upon a member of the
Association that it pay fees different from those
required to be paid to that State were it not a member
of the Association; or
``(C) impose any continuing education requirements
on any nonresident insurance producer that is a member
of the Association.
``(2) States other than a home state.--No State, other than
the home State of a member of the Association, shall--
[[Page 129 STAT. 26]]
``(A) impose any licensing, personal or corporate
qualifications, education, training, experience,
residency, continuing education, or bonding requirement
upon a member of the Association that is different from
the criteria for membership in the Association or
renewal of such membership;
``(B) impose any requirement upon a member of the
Association that it be licensed, registered, or
otherwise qualified to do business or remain in good
standing in the State, including any requirement that
the insurance producer register as a foreign company
with the secretary of state or equivalent State
official;
``(C) require that a member of the Association
submit to a criminal history record check as a condition
of doing business in the State; or
``(D) impose any licensing, registration, or
appointment requirements upon a member of the
Association, or require a member of the Association to
be authorized to operate as an insurance producer, in
order to sell, solicit, or negotiate insurance for
commercial property and casualty risks to an insured
with risks located in more than one State, if the member
is licensed or otherwise authorized to operate in the
State where the insured maintains its principal place of
business and the contract of insurance insures risks
located in that State.
``(3) Preservation of state disciplinary authority.--Nothing
in this section may be construed to prohibit a State from
investigating and taking appropriate disciplinary action,
including suspension or revocation of authority of an insurance
producer to do business in a State, in accordance with State law
and that is not inconsistent with the provisions of this
section, against a member of the Association as a result of a
complaint or for any alleged activity, regardless of whether the
activity occurred before or after the insurance producer
commenced doing business in the State pursuant to Association
membership.
``SEC. 331. <<NOTE: 15 USC 6761.>> COORDINATION WITH FINANCIAL
INDUSTRY REGULATORY AUTHORITY.
``The Association shall coordinate with the Financial Industry
Regulatory Authority in order to ease any administrative burdens that
fall on members of the Association that are subject to regulation by the
Financial Industry Regulatory Authority, consistent with the
requirements of this subtitle and the Federal securities laws.
``SEC. 332. <<NOTE: 15 USC 6762.>> RIGHT OF ACTION.
``(a) Right of Action.--Any person aggrieved by a decision or action
of the Association may, after reasonably exhausting available avenues
for resolution within the Association, commence a civil action in an
appropriate United States district court, and obtain all appropriate
relief.
``(b) <<NOTE: Courts.>> Association Interpretations.--In any action
under subsection (a), the court shall give appropriate weight to the
interpretation of the Association of its bylaws and standards and this
subtitle.
[[Page 129 STAT. 27]]
``SEC. 333. <<NOTE: 15 USC 6763.>> FEDERAL FUNDING PROHIBITED.
``The Association may not receive, accept, or borrow any amounts
from the Federal Government to pay for, or reimburse, the Association
for, the costs of establishing or operating the Association.
``SEC. 334. <<NOTE: 15 USC 6764.>> DEFINITIONS.
``For purposes of this subtitle, the following definitions shall
apply:
``(1) Business entity.--The term `business entity' means a
corporation, association, partnership, limited liability
company, limited liability partnership, or other legal entity.
``(2) Depository institution.--The term `depository
institution' has the meaning as in section 3 of the Federal
Deposit Insurance Act (12 U.S.C. 1813).
``(3) Home state.--The term `home State' means the State in
which the insurance producer maintains its principal place of
residence or business and is licensed to act as an insurance
producer.
``(4) Insurance.--The term `insurance' means any product,
other than title insurance or bail bonds, defined or regulated
as insurance by the appropriate State insurance regulatory
authority.
``(5) Insurance producer.--The term `insurance producer'
means any insurance agent or broker, excess or surplus lines
broker or agent, insurance consultant, limited insurance
representative, and any other individual or entity that sells,
solicits, or negotiates policies of insurance or offers advice,
counsel, opinions or services related to insurance.
``(6) Insurer.--The term `insurer' has the meaning as in
section 313(e)(2)(B) of title 31, United States Code.
``(7) Principal place of business.--The term `principal
place of business' means the State in which an insurance
producer maintains the headquarters of the insurance producer
and, in the case of a business entity, where high-level officers
of the entity direct, control, and coordinate the business
activities of the business entity.
``(8) Principal place of residence.--The term `principal
place of residence' means the State in which an insurance
producer resides for the greatest number of days during a
calendar year.
``(9) State.--The term `State' includes any State, the
District of Columbia, any territory of the United States, and
Puerto Rico, Guam, American Samoa, the Trust Territory of the
Pacific Islands, the Virgin Islands, and the Northern Mariana
Islands.
``(10) State law.--
``(A) In general.--The term `State law' includes all
laws, decisions, rules, regulations, or other State
action having the effect of law, of any State.
``(B) Laws applicable in the district of columbia.--
A law of the United States applicable only to or within
the District of Columbia shall be treated as a State law
rather than a law of the United States.''.
(b) Technical Amendment.--The table of contents for the Gramm-Leach-
Bliley Act is amended by striking the items relating to subtitle C of
title III and inserting the following new items:
[[Page 129 STAT. 28]]
``Subtitle C--National Association of Registered Agents and Brokers
``Sec. 321. National Association of Registered Agents and Brokers.
``Sec. 322. Purpose.
``Sec. 323. Membership.
``Sec. 324. Board of directors.
``Sec. 325. Bylaws, standards, and disciplinary actions.
``Sec. 326. Powers.
``Sec. 327. Report by the Association.
``Sec. 328. Liability of the Association and the Board members,
officers, and employees of the Association.
``Sec. 329. Presidential oversight.
``Sec. 330. Relationship to State law.
``Sec. 331. Coordination with financial industry regulatory authority.
``Sec. 332. Right of action.
``Sec. 333. Federal funding prohibited.
``Sec. 334. Definitions.''.
TITLE <<NOTE: Business Risk Mitigation and Price Stabilization Act of
2015. 7 USC 1 note.>> III--BUSINESS RISK MITIGATION AND PRICE
STABILIZATION
SEC. 301. SHORT TITLE.
This title may be cited as the ``Business Risk Mitigation and Price
Stabilization Act of 2015''.
SEC. 302. MARGIN REQUIREMENTS.
(a) Commodity Exchange Act Amendment.--Section 4s(e) of the
Commodity Exchange Act (7 U.S.C. 6s(e)), as added by section 731 of the
Dodd-Frank Wall Street Reform and Consumer Protection Act, is amended by
adding at the end the following new paragraph:
``(4) Applicability with respect to counterparties.--The
requirements of paragraphs (2)(A)(ii) and (2)(B)(ii), including
the initial and variation margin requirements imposed by rules
adopted pursuant to paragraphs (2)(A)(ii) and (2)(B)(ii), shall
not apply to a swap in which a counterparty qualifies for an
exception under section 2(h)(7)(A), or an exemption issued under
section 4(c)(1) from the requirements of section 2(h)(1)(A) for
cooperative entities as defined in such exemption, or satisfies
the criteria in section 2(h)(7)(D).''.
(b) Securities Exchange Act Amendment.--Section 15F(e) of the
Securities Exchange Act of 1934 (15 U.S.C. 78o-10(e)), as added by
section 764(a) of the Dodd-Frank Wall Street Reform and Consumer
Protection Act, is amended by adding at the end the following new
paragraph:
``(4) Applicability with respect to counterparties.--The
requirements of paragraphs (2)(A)(ii) and (2)(B)(ii) shall not
apply to a security-based swap in which a counterparty qualifies
for an exception under section 3C(g)(1) or satisfies the
criteria in section 3C(g)(4).''.
SEC. 303. <<NOTE: 7 USC 65 note.>> IMPLEMENTATION.
The amendments made by this title to the Commodity Exchange Act
shall be implemented--
(1) without regard to--
(A) chapter 35 of title 44, United States Code; and
(B) the notice and comment provisions of section 553
of title 5, United States Code;
(2) <<NOTE: Regulations. Public comments.>> through the
promulgation of an interim final rule, pursuant to which public
comment will be sought before a final rule is issued; and
[[Page 129 STAT. 29]]
(3) <<NOTE: Applicability.>> such that paragraph (1) shall
apply solely to changes to rules and regulations, or proposed
rules and regulations, that are limited to and directly a
consequence of such amendments.
Approved January 12, 2015.
LEGISLATIVE HISTORY--H.R. 26:
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CONGRESSIONAL RECORD, Vol. 161 (2015):
Jan. 7, considered and passed House.
Jan. 8, considered and passed Senate.
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