HR 3045 IHCommentsClose CommentsPermalink

112th CONGRESSCommentsClose CommentsPermalink

1st SessionCommentsClose CommentsPermalink

H. R. 3045CommentsClose CommentsPermalink

To amend the Employee Retirement Income Security Act of 1974, the Commodity Exchange Act, and the Securities Exchange Act of 1934 to ensure that pension plans can use swaps to hedge risks, and for other purposes.CommentsClose CommentsPermalink

IN THE HOUSE OF REPRESENTATIVESCommentsClose CommentsPermalink

September 23, 2011CommentsClose CommentsPermalink

Mr. CANSECO (for himself and Mr. GARRETT) introduced the following bill; which was referred to the Committee on Agriculture, and in addition to the Committees on Education and the Workforce and Financial Services, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concernedCommentsClose CommentsPermalink

A BILLCommentsClose CommentsPermalink

To amend the Employee Retirement Income Security Act of 1974, the Commodity Exchange Act, and the Securities Exchange Act of 1934 to ensure that pension plans can use swaps to hedge risks, and for other purposes.CommentsClose CommentsPermalink

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,CommentsClose CommentsPermalink

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘Retirement Income Protection Act of 2011’.CommentsClose CommentsPermalink

SEC. 2. CLARIFICATION OF THE DEFINITION OF FIDUCIARY.

Section 3(21) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002(21)) is amended--CommentsClose CommentsPermalink





(1) in subparagraph (A), by striking ‘subparagraph (B)’ and inserting ‘subparagraphs (B) and (C)’;CommentsClose CommentsPermalink





(2) by adding at the end the following subparagraph:CommentsClose CommentsPermalink





‘(C) No person shall be a fiduciary with respect to a plan by reason of any service, act, or duty that such person is required to perform with respect to such plan by reason of section 4s(h) of the Commodity Exchange Act, section 15F(h) of the Securities Exchange Act of 1934, any rule, regulation, or standard prescribed pursuant to such sections, or any other Federal law, rule, or regulation.’.CommentsClose CommentsPermalink

SEC. 3. CLARIFICATION OF THE DEFINITION OF SPECIAL ENTITY AND REMOVAL OF ERISA PLANS.

(a) Amendment to the CEA- Section 4s(h)(2)(C) of the Commodity Exchange Act (7 U.S.C. 6s(h)(2)(C)) is amended--CommentsClose CommentsPermalink





(1) by striking ‘For purposes’ and inserting ‘(i) For purposes’;CommentsClose CommentsPermalink





(2) by striking clause (iii) and redesignating clauses (i), (ii), (iv), and (v) as subclauses (I), (II), (III) and (IV), respectively; andCommentsClose CommentsPermalink





(3) by adding at the end the following:.CommentsClose CommentsPermalink





‘(ii) Such term shall not include any collective investment vehicle in which one or more special entities invest.’.CommentsClose CommentsPermalink





(b) Amendment to the 1934 Act- Section 15F(h)(2)(C) of the Securities Exchange Act of 1934 (15 U.S.C. 78o-10(h)(2)(C)) is amended--CommentsClose CommentsPermalink





(1) by striking ‘For purposes’ and inserting ‘(i) For purposes’;CommentsClose CommentsPermalink





(2) by striking clause (iii) and redesignating clauses (i), (ii), (iv), and (v) as subclauses (I), (II), (III) and (IV), respectively; andCommentsClose CommentsPermalink





(3) by adding at the end the following:CommentsClose CommentsPermalink





‘(ii) Such term shall not include any collective investment vehicle in which one or more special entities invest.’.CommentsClose CommentsPermalink

SEC. 4. CONFORMING AMENDMENTS TO COUNTERPARTY REQUIREMENTS.

(a) Amendment to the CEA- Section 4s(h)(5)(A)(i) of the Commodity Exchange Act (7 U.S.C. 6s(h)(5)(A)(i)) is amended--CommentsClose CommentsPermalink





(1) by inserting ‘and’ after the semicolon in subclause (V); andCommentsClose CommentsPermalink





(2) by striking subclause (VII).CommentsClose CommentsPermalink





(b) Amendment to the 1934 Act- Section 15F(h)(5)(A)(i) of the Securities Exchange Act of 1934 (15 U.S.C. 78o-10(h)(5)(A)(i)) is amended--CommentsClose CommentsPermalink





(1) by inserting ‘and’ after the semicolon in subclause (V); andCommentsClose CommentsPermalink





(2) by striking subclause (VII).CommentsClose CommentsPermalink

SEC. 5. CLARIFICATION OF THE DEFINITION OF ADVISOR.

(a) Amendment to the CEA- Section 4s(h)(4) of the Commodity Exchange Act (7 U.S.C. 6s(h)(4)) is amended--CommentsClose CommentsPermalink





(1) in subparagraph (B), by adding at the end the following: ‘The duty of a swap dealer to act in the best interests of a Special Entity shall not be construed to be a fiduciary standard under Federal or State Law.’; andCommentsClose CommentsPermalink





(2) by adding at the end the following:CommentsClose CommentsPermalink





‘(D) RULE OF CONSTRUCTION- A swap dealer will not be treated as an advisor to a Special Entity if--CommentsClose CommentsPermalink





‘(i) the Special Entity represents in writing that--CommentsClose CommentsPermalink





‘(I) the Special Entity will not rely on recommendations provided by the swap dealer; andCommentsClose CommentsPermalink





‘(II) the Special Entity will rely on advice from an independent representative as described in paragraph (5); andCommentsClose CommentsPermalink





‘(ii) the swap dealer discloses to the Special Entity that it is not undertaking to act in the best interests of the Special Entity, as otherwise required by this paragraph.CommentsClose CommentsPermalink





No swap dealer shall be considered to act as an advisor to a Special Entity solely by reason of providing information to an independent representative described in paragraph (5)(D) of a Special Entity.’.CommentsClose CommentsPermalink





(b) Amendment to the 1934 Act- Section 15F(h)(4)(B) of the Securities Exchange Act of 1934 (15 U.S.C. 78o-10(h)(4)(B)) is amended--CommentsClose CommentsPermalink





(1) in subparagraph (B), by adding at the end the following: ‘The duty of a security-based swap dealer to act in the best interests of a Special Entity shall not be construed to be a fiduciary standard under Federal or State Law.’; andCommentsClose CommentsPermalink





(2) by adding at the end the following:CommentsClose CommentsPermalink





‘(D) RULE OF CONSTRUCTION- A security-based swap dealer will not be treated as an advisor to a Special Entity if--CommentsClose CommentsPermalink





‘(i) the Special Entity represents in writing that--CommentsClose CommentsPermalink





‘(I) the Special Entity will not rely on recommendations provided by the security-based swap dealer; andCommentsClose CommentsPermalink





‘(II) the Special Entity will rely on advice from an independent representative as described in paragraph (5); andCommentsClose CommentsPermalink





‘(ii) the security-based swap dealer discloses to the Special Entity that it is not undertaking to act in the best interests of the Special Entity, as otherwise required by this paragraph.CommentsClose CommentsPermalink





No security-based swap dealer shall be considered to act as an advisor to a Special Entity solely by reason of providing information to an independent representative described in paragraph (5)(D) of a Special Entity.’.CommentsClose CommentsPermalink

SEC. 6. CLARIFICATION OF THE DEFINITION OF INDEPENDENT REPRESENTATIVES.

(a) Amendment to the CEA- Section 4s(h)(5) of the Commodity Exchange Act (7 U.S.C. 6s(h)(5)) is amended--CommentsClose CommentsPermalink





(1) in subparagraph (A)(ii) by striking ‘; and’ and inserting a period;CommentsClose CommentsPermalink





(2) in subparagraph (B), by striking ‘the Commission’ and inserting ‘The Commission’;CommentsClose CommentsPermalink





(3) by adding at the end the following subparagraphs:CommentsClose CommentsPermalink





‘(C) A representative of a Special Entity will be considered to be independent of a swap dealer if--CommentsClose CommentsPermalink





‘(i) the representative is not an associated person of the swap dealer within the meaning of section 1a(4); andCommentsClose CommentsPermalink





‘(ii) no more than 10 percent of the gross revenues of the representative are derived from the swap dealer.CommentsClose CommentsPermalink





‘(D) Each of the requirements of this paragraph shall be considered to be met if the Special Entity represents to the swap dealer that it is represented by--CommentsClose CommentsPermalink





‘(i) an entity registered as an investment adviser under the Investment Advisers Act of 1940;CommentsClose CommentsPermalink





‘(ii) a commodity trading adviser as defined in section 1a(12);CommentsClose CommentsPermalink





‘(iii) a municipal advisor as defined in section 15B(e)(4) of the Securities Exchange Act of 1934; orCommentsClose CommentsPermalink





‘(iv) an advisor certified by the National Futures Association.’.CommentsClose CommentsPermalink





(b) Amendment to the 1934 Act- Section 15F(h)(5) of the Securities Exchange Act of 1934 (15 U.S.C. 78o-10(h)(5)) is amended by adding at the end the following subparagraphs:CommentsClose CommentsPermalink





‘(C) INDEPENDENCE- A representative of a Special Entity will be considered to be independent of a security-based swap dealer if--CommentsClose CommentsPermalink





‘(i) the representative is not an associated person of the security-based swap dealer within the meaning of section 1a(4) of the Commodity Exchange Act; andCommentsClose CommentsPermalink





‘(ii) no more than 10 percent of the gross revenues of the representative are derived from the security-based swap dealer.CommentsClose CommentsPermalink





‘(D) RULE OF CONSTRUCTION- Each of the requirements of this paragraph shall be considered to be met if the Special Entity represents to the security-based swap dealer that it is represented by--CommentsClose CommentsPermalink





‘(i) an entity registered as an investment adviser under the Investment Advisers Act of 1940;CommentsClose CommentsPermalink





‘(ii) a commodity trading adviser as defined in section 1a(12) of the Commodity Exchange Act;CommentsClose CommentsPermalink





‘(iii) a municipal advisor as defined in section 15B(e)(4); orCommentsClose CommentsPermalink





‘(iv) an advisor certified by the Financial Industry Regulatory Authority.’.CommentsClose CommentsPermalink

SEC. 7. AMENDMENT TO THE DEFINITION OF COMMODITY TRADING ADVISOR.

Section 1a(12)(B)(iii) of the Commodity Exchange Act (7 U.S.C. 1a(12)(B)(iii)) is amended by striking ‘or futures commission merchant’ and inserting ‘, futures commission merchant, or swap dealer’.CommentsClose CommentsPermalink

SEC. 8. EFFECTIVE DATE.

(a) In General- The amendments made by sections 3 through 7 to the respective provisions of the Commodity Exchange Act and the Securities Exchange Act of 1934 shall take effect as if included in the sections of the Dodd-Frank Wall Street Reform and Consumer Protection Act that added such respective provisions to such Acts.CommentsClose CommentsPermalink





(b) ERISA Amendments- The amendment made by section 2 of this Act shall take effect as if enacted on the date of enactment of the Dodd-Frank Wall Street Reform and Consumer Protection Act.CommentsClose CommentsPermalink