12 U.S.C. § 5461 — Findings and purposes

Page 1927 TITLE 12—BANKS AND BANKING § 5461 (2) sponsoring and recruiting at job fairs in urban communities; (3) placing employment advertisements in newspapers and magazines oriented toward minorities and women; (4) partnering with organizations that are fo- cused on developing opportunities for minori- ties and women to place talented young mi- norities and women in industry internships, summer employment, and full-time positions; (5) where feasible, partnering with inner-city high schools, girls’ high schools, and high schools with majority minority populations to establish or enhance financial literacy pro- grams and provide mentoring; and (6) any other mass media communications that the Office determines necessary. (g) Definitions For purposes of this section, the following definitions shall apply: (1) Agency The term ‘‘agency’’ means— (A) the Departmental Offices of the De- partment of the Treasury; (B) the Corporation; (C) the Federal Housing Finance Agency; (D) each of the Federal reserve banks; (E) the Board; (F) the National Credit Union Administra- tion; (G) the Office of the Comptroller of the Currency; (H) the Commission; and (I) the Bureau. (2) Agency administrator The term ‘‘agency administrator’’ means the head of an agency. (3) Minority The term ‘‘minority’’ has the same meaning as in section 1204(c) of the Financial Institu- tions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1811 note). (4) Minority-owned business The term ‘‘minority-owned business’’ has the same meaning as in section 1441a(r)(4)(A) of this title, as in effect on the day before the transfer date. (5) Office The term ‘‘Office’’ means the Office of Mi- nority and Women Inclusion established by an agency under subsection (a). (6) Women-owned business The term ‘‘women-owned business’’ has the meaning given the term ‘‘women’s business’’ in section 1441a(r)(4)(B) of this title, as in ef- fect on the day before the transfer date. (Pub. L. 111–203, title III, § 342, July 21, 2010, 124 Stat. 1541.) Editorial Notes REFERENCES IN TEXT Section 1204(c) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, referred to in subsec. (g)(3), is section 1204(c) of Pub. L. 101–73, which is set out as a note under section 1811 of this title. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective 1 day after July 21, 2010, except as otherwise provided, see section 4 of Pub. L. 111–203, set out as a note under section 5301 of this title. SUBCHAPTER IV—PAYMENT, CLEARING, AND SETTLEMENT SUPERVISION § 5461. Findings and purposes (a) Findings Congress finds the following: (1) The proper functioning of the financial markets is dependent upon safe and efficient arrangements for the clearing and settlement of payment, securities, and other financial transactions. (2) Financial market utilities that conduct or support multilateral payment, clearing, or settlement activities may reduce risks for their participants and the broader financial system, but such utilities may also con- centrate and create new risks and thus must be well designed and operated in a safe and sound manner. (3) Payment, clearing, and settlement activi- ties conducted by financial institutions also present important risks to the participating financial institutions and to the financial sys- tem. (4) Enhancements to the regulation and su- pervision of systemically important financial market utilities and the conduct of system- ically important payment, clearing, and set- tlement activities by financial institutions are necessary— (A) to provide consistency; (B) to promote robust risk management and safety and soundness; (C) to reduce systemic risks; and (D) to support the stability of the broader financial system. (b) Purpose The purpose of this subchapter is to mitigate systemic risk in the financial system and pro- mote financial stability by— (1) authorizing the Board of Governors to promote uniform standards for the— (A) management of risks by systemically important financial market utilities; and (B) conduct of systemically important payment, clearing, and settlement activities by financial institutions; (2) providing the Board of Governors an en- hanced role in the supervision of risk manage- ment standards for systemically important fi- nancial market utilities; (3) strengthening the liquidity of system- ically important financial market utilities; and (4) providing the Board of Governors an en- hanced role in the supervision of risk manage- ment standards for systemically important payment, clearing, and settlement activities by financial institutions. (Pub. L. 111–203, title VIII, § 802, July 21, 2010, 124 Stat. 1802.) Page 1928 TITLE 12—BANKS AND BANKING § 5462 1 See References in Text note below. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Pub. L. 111–203, title VIII, § 814, July 21, 2010, 124 Stat. 1822, provided that: ‘‘This title [enacting this sub- chapter] is effective as of the date of enactment of this Act [July 21, 2010].’’ SHORT TITLE This subchapter known as the ‘‘Payment, Clearing, and Settlement Supervision Act of 2010’’, see Short Title note set out under section 5301 of this title. § 5462. Definitions In this subchapter, the following definitions shall apply: (1) Appropriate financial regulator The term ‘‘appropriate financial regulator’’ means— (A) the primary financial regulatory agen- cy, as defined in section 5301 of this title; (B) the National Credit Union Administra- tion, with respect to any insured credit union under the Federal Credit Union Act (12 U.S.C. 1751 et seq.); and (C) the Board of Governors, with respect to organizations operating under section 25A of the Federal Reserve Act (12 U.S.C. 611), and any other financial institution engaged in a designated activity. (2) Designated activity The term ‘‘designated activity’’ means a payment, clearing, or settlement activity that the Council has designated as systemically im- portant under section 5463 of this title. (3) Designated clearing entity The term ‘‘designated clearing entity’’ means a designated financial market utility that is a derivatives clearing organization reg- istered under section 5b of the Commodity Ex- change Act (7 U.S.C. 7a–1) or a clearing agency registered with the Securities and Exchange Commission under section 17A of the Securi- ties Exchange Act of 1934 (15 U.S.C. 78q–1). (4) Designated financial market utility The term ‘‘designated financial market util- ity’’ means a financial market utility that the Council has designated as systemically impor- tant under section 5463 of this title. (5) Financial institution (A) In general The term ‘‘financial institution’’ means— (i) a depository institution, as defined in section 1813 of this title; (ii) a branch or agency of a foreign bank, as defined in section 3101 of this title; (iii) an organization operating under sec- tion 25 or 25A of the Federal Reserve Act (12 U.S.C. 601–604a and 611 through 631); (iv) a credit union, as defined in section 101 of the Federal Credit Union Act (12 U.S.C. 1752); 1 (v) a broker or dealer, as defined in sec- tion 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c); (vi) an investment company, as defined in section 80a–3 of title 15; (vii) an insurance company, as defined in section 80a–2 of title 15; (viii) an investment adviser, as defined in section 80b–2 of title 15; (ix) a futures commission merchant, commodity trading advisor, or commodity pool operator, as defined in section 1a of the Commodity Exchange Act (7 U.S.C. 1a); and (x) any company engaged in activities that are financial in nature or incidental to a financial activity, as described in sec- tion 4 of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(k)). (B) Exclusions The term ‘‘financial institution’’ does not include designated contract markets, reg- istered futures associations, swap data re- positories, and swap execution facilities reg- istered under the Commodity Exchange Act (7 U.S.C. 1 et seq.), or national securities ex- changes, national securities associations, al- ternative trading systems, securities infor- mation processors solely with respect to the activities of the entity as a securities infor- mation processor, security-based swap data repositories, and swap execution facilities registered under the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.), or des- ignated clearing entities, provided that the exclusions in this subparagraph apply only with respect to the activities that require the entity to be so registered. (6) Financial market utility (A) Inclusion The term ‘‘financial market utility’’ means any person that manages or operates a multilateral system for the purpose of transferring, clearing, or settling payments, securities, or other financial transactions among financial institutions or between fi- nancial institutions and the person. (B) Exclusions The term ‘‘financial market utility’’ does not include— (i) designated contract markets, reg- istered futures associations, swap data re- positories, and swap execution facilities registered under the Commodity Exchange Act (7 U.S.C. 1 et seq.), or national securi- ties exchanges, national securities associa- tions, alternative trading systems, secu- rity-based swap data repositories, and swap execution facilities registered under the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.), solely by reason of their providing facilities for comparison of data respecting the terms of settlement of secu- rities or futures transactions effected on such exchange or by means of any elec- tronic system operated or controlled by such entities, provided that the exclusions in this clause apply only with respect to the activities that require the entity to be so registered; and (ii) any broker, dealer, transfer agent, or investment company, or any futures com- mission merchant, introducing broker, commodity trading advisor, or commodity