15 U.S.C. § 78fff — General provisions of a liquidation pro-

Page 488 TITLE 15—COMMERCE AND TRADE § 78fff Subsec. (b)(5)(B). Pub. L. 95–598, § 308(f)(1), (2), (5), re- designated subpar. (C) as (B) and substituted ‘‘title 11 governing applications for allowances under such title’’ for ‘‘the Bankruptcy Act governing applications for al- lowances under such Act’’. Former subpar. (B), which covered allowances to a referee in bankruptcy or spe- cial master, was struck out. Subsec. (b)(5)(C). Pub. L. 95–598, § 308(f)(2), (3), (5), re- designated subpar. (D) as (C) and substituted ‘‘subpara- graph (B)’’ for ‘‘subparagraph (C)’’. Former subpar. (C) redesignated (B). Subsec. (b)(5)(D). Pub. L. 95–598, § 308(f)(2), (4), (5), re- designated subpar. (E) as (D) and substituted ‘‘Section 504 of title 11’’ for ‘‘the Bankruptcy Act’’. Former sub- par. (D) redesignated (C). Subsec. (b)(5)(E), (F). Pub. L. 95–598, § 308(f)(5), redes- ignated subpar. (F) as (E). Former subpar. (E) redesig- nated (D). Subsec. (b). Pub. L. 95–283, § 7(b), in par. (1) inserted ‘‘protective’’ after ‘‘of’’ in heading and substituted pro- visions relating to issuance of protective decrees, for provisions relating to specific findings necessary for issuance of a decree and uncontested, etc., applications, in par. (2) substituted ‘‘Jurisdiction and powers of court’’ for ‘‘Exclusive jurisdiction over debtor’’ in head- ing and substituted provisions setting forth jurisdic- tion and powers of court with respect to exclusivity of such jurisdiction, for provisions relating to exclusive jurisdiction over the debtor, in par. (3) inserted ‘‘and attorney’’ after ‘‘trustee’’ in heading and substituted provisions relating to appointment of trustee and at- torney, for provisions relating to appointment of trust- ee, in par. (4) substituted ‘‘Reference to referee in bank- ruptcy’’ for ‘‘Debtor and filing date defined’’ in heading and substituted provisions relating to reference to ref- eree in bankruptcy, for provisions defining terms ‘‘debtor’’ and ‘‘filing date’’, and added pars. (5) and (6). Subsec. (d). Pub. L. 95–283, § 7(c), added subsec. (d). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2010 AMENDMENT Amendment by Pub. L. 111–203 effective 1 day after July 21, 2010, except as otherwise provided, see section 4 of Pub. L. 111–203, set out as an Effective Date note under section 5301 of Title 12, Banks and Banking. EFFECTIVE DATE OF 2006 AMENDMENT Amendment by Pub. L. 109–390 not applicable to any cases commenced under Title 11, Bankruptcy, or to ap- pointments made under any Federal or State law, be- fore Dec. 12, 2006, see section 7 of Pub. L. 109–390, set out as a note under section 101 of Title 11. EFFECTIVE DATE OF 2005 AMENDMENT Amendment by Pub. L. 109–8 effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under Title 11, Bankruptcy, before such ef- fective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as a note under section 101 of Title 11. EFFECTIVE DATE OF 1978 AMENDMENT Amendment by Pub. L. 95–598 effective Oct. 1, 1979, see section 402(a) of Pub. L. 95–598, set out as an Effec- tive Date note preceding section 101 of Title 11, Bank- ruptcy. § 78fff. General provisions of a liquidation pro- ceeding (a) Purposes The purposes of a liquidation proceeding under this chapter shall be— (1) as promptly as possible after the appoint- ment of a trustee in such liquidation pro- ceeding, and in accordance with the provisions of this chapter— (A) to deliver customer name securities to or on behalf of the customers of the debtor entitled thereto as provided in section 78fff–2(c)(2) of this title; and (B) to distribute customer property and (in advance thereof or concurrently therewith) otherwise satisfy net equity claims of cus- tomers to the extent provided in this sec- tion; (2) to sell or transfer offices and other pro- ductive units of the business of the debtor; (3) to enforce rights of subrogation as pro- vided in this chapter; and (4) to liquidate the business of the debtor. (b) Application of title 11 To the extent consistent with the provisions of this chapter, a liquidation proceeding shall be conducted in accordance with, and as though it were being conducted under chapters 1, 3, and 5 and subchapters I and II of chapter 7 of title 11. For the purposes of applying such title in car- rying out this section, a reference in such title to the date of the filing of the petition shall be deemed to be a reference to the filing date under this chapter. (c) Determination of customer status In a liquidation proceeding under this chapter, whenever a person has acted with respect to cash or securities with the debtor after the fil- ing date and in a manner which would have given him the status of a customer with respect to such cash or securities had the action oc- curred prior to the filing date, and the trustee is satisfied that such action was taken by the cus- tomer in good faith and prior to the appoint- ment of the trustee, the date on which such ac- tion was taken shall be deemed to be the filing date for purposes of determining the net equity of such customer with respect to such cash or securities. (d) Apportionment In a liquidation proceeding under this chapter, any cash or securities remaining after the liq- uidation of a lien or pledge made by a debtor shall be apportioned between his general estate and customer property in the proportion in which the general property of the debtor and the cash and securities of the customers of such debtor contributed to such lien or pledge. Secu- rities apportioned to the general estate under this subsection shall be subject to the provisions of section 78lll(5)(A) of this title. (e) Costs and expenses of administration All costs and expenses of administration of the estate of the debtor and of the liquidation pro- ceeding shall be borne by the general estate of the debtor to the extent it is sufficient therefor, and the priorities of distribution from the gen- eral estate shall be as provided in section 726 of title 11. Costs and expenses of administration shall include payments pursuant to section 78fff–2(e) of this title and section 78fff–3(c)(1) of this title (to the extent such payments recov- ered securities which were apportioned to the general estate pursuant to subsection (d)) and costs and expenses of SIPC employees utilized by the trustee pursuant to section 78fff–1(a)(2) of this title. All funds advanced by SIPC to a trust- Page 489 TITLE 15—COMMERCE AND TRADE § 78fff–1 ee for such costs and expenses of administration shall be recouped from the general estate under section 507(a)(2) of title 11. (Pub. L. 91–598, § 6, Dec. 30, 1970, 84 Stat. 1646; Pub. L. 95–283, § 8, May 21, 1978, 92 Stat. 259; Pub. L. 95–598, title III, § 308(g), (h), Nov. 6, 1978, 92 Stat. 2675; Pub. L. 109–8, title XV, § 1502(b), Apr. 20, 2005, 119 Stat. 217.) Editorial Notes REFERENCES IN TEXT This chapter, referred to in subsecs. (a)(1), (3), (b), (c), and (d), was in the original ‘‘this Act’’, meaning Pub. L. 91–598, Dec. 30, 1970, 84 Stat. 1636. For complete classi- fication of this Act to the Code, see Tables. AMENDMENTS 2005—Subsec. (e). Pub. L. 109–8 substituted ‘‘507(a)(2)’’ for ‘‘507(a)(1)’’. 1978—Pub. L. 95–283 substituted ‘‘General provisions of a liquidation proceeding’’ for ‘‘Liquidation pro- ceedings’’ in section catchline. Subsec. (a). Pub. L. 95–283 in heading substituted ‘‘Purposes’’ for ‘‘General purposes of liquidation pro- ceeding’’, in introductory text substituted provisions relating to purposes of liquidation proceedings under this chapter, for provisions relating to purposes of any proceeding in which a trustee has been appointed under section 78eee(b)(3) of this title, in par. (1) substituted provisions requiring execution of authorities to deliver customer name securities and distribute customer property in accordance with this chapter, for provisions requiring execution of authorities to return specifically identifiable property and distribute the single and sep- arate fund in accordance with this section, and in par. (2) substituted provisions authorizing sale, etc., of pro- ductive units of the debtor, for provisions authorizing operation of the business of the debtor. Subsec. (b). Pub. L. 95–598, § 308(g), in heading sub- stituted ‘‘title 11’’ for ‘‘Bankruptcy Act’’ and in text ‘‘under chapters 1, 3, and 5 and subchapters I and II of chapter 7 of title 11. For the purposes of applying such title in carrying out this section, a reference in such title to the date of the filing of the petition shall be deemed to be a reference to the filing date under this chapter.’’ for ‘‘under, the Bankruptcy Act. For purposes of applying the Bankruptcy Act to this chapter, any reference in the Bankruptcy Act to the date of com- mencement of proceedings under the Bankruptcy Act shall be deemed to be a reference to the filing date under this chapter.’’ Pub. L. 95–283 in heading substituted ‘‘Application of Bankruptcy Act’’ for ‘‘Powers and Duties of Trustee’’, and in text substituted provisions relating to applica- bility of Bankruptcy Act to liquidation proceedings, for provisions relating to the powers and duties of trustees. See section 78fff–1 of this title. Subsec. (c). Pub. L. 95–283 in heading substituted ‘‘De- termination of customer status’’ for ‘‘Application of Bankruptcy Act’’, and in text substituted provisions re- lating to determination of status of a customer with re- spect to cash or securities, for provisions setting forth general and special provisions of the Bankruptcy Act applicable to liquidation proceedings, and defining terms for purposes of such applicability and the provi- sions of this section. See subsec. (b) of this section and section 78fff–2(c) of this title. Subsec. (d). Pub. L. 95–283 in heading substituted ‘‘Apportionment’’ for ‘‘Completion of open contractual commitments’’, and in text substituted provisions re- lating to apportionment of cash or securities remaining after the liquidation of a lien or pledge made by a debt- or, for provisions relating to completion by the trustee of open contractual commitments, which were made in the ordinary course of the debtor’s business and which were outstanding on the filing date. See section 78fff–2(e) of this title. Subsec. (e). Pub. L. 95–598, § 308(h), substituted in first sentence ‘‘section 726 of title 11’’ for ‘‘the Bankruptcy Act’’ and in last sentence ‘‘under section 507(a)(1) of title 11’’ for ‘‘as a first priority under the Bankruptcy Act’’. Pub. L. 95–283 in heading substituted ‘‘Costs and ex- pense of administration’’ for ‘‘Notice’’, and in text sub- stituted provisions relating to costs and expenses of ad- ministration of the estate of the debtor and of the liq- uidation proceeding, for provisions relating to notice requirements for the trustee subsequent to appoint- ment as trustee. See section 78fff–2(a)(l) of this title. Subsec. (f). Pub. L. 95–283 struck out subsec. (f) re- quiring advances by the SIPC to the trustee for cus- tomers’ claims and completion of open contractual commitments, and authorizing discretionary advances to the trustee for compensation of personnel deemed necessary for the liquidation proceeding. See section 78fff–3 of this title. Subsec. (g). Pub. L. 95–283 struck out subsec. (g) set- ting forth provisions relating to payments to cus- tomers by the trustee, and provisions respecting the quantum of proof of claim required for such payment. See section 78fff–2(a)(2) and (b) of this title. Subsec. (h). Pub. L. 95–283 struck out subsec. (h) re- lating to nonapplicability of provisions to proof of claim by associates and others connected in some way with the debtor. See section 78fff–2(a)(2) of this title. Subsec. (i). Pub. L. 95–283 struck out subsec. (i) set- ting forth provisions relating to reports by the trustee to the court. See section 78fff–1(c) of this title. Subsec. (j). Pub. L. 95–283 struck out subsec. (j) which related to nonapplicability of provisions to rights of persons to establish by formal proof such claims as they may have to payment or delivery of specific secu- rities. See section 78fff–2(a)(4) of this title. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2005 AMENDMENT Amendment by Pub. L. 109–8 effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under Title 11, Bankruptcy, before such ef- fective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as a note under section 101 of Title 11. EFFECTIVE DATE OF 1978 AMENDMENT Amendment by Pub. L. 95–598 effective Oct. 1, 1979, see section 402(a) of Pub. L. 95–598, set out as an Effec- tive Date note preceding section 101 of Title 11, Bank- ruptcy. § 78fff–1. Powers and duties of a trustee (a) Trustee powers A trustee shall be vested with the same powers and title with respect to the debtor and the property of the debtor, including the same rights to avoid preferences, as a trustee in a case under title 11. In addition, a trustee may, with the approval of SIPC but without any need for court approval— (1) hire and fix the compensation of all per- sonnel (including officers and employees of the debtor and of its examining authority) and other persons (including accountants) that are deemed by the trustee necessary for all or any purposes of the liquidation proceeding; (2) utilize SIPC employees for all or any pur- poses of a liquidation proceeding; and (3) margin and maintain customer accounts of the debtor for the purposes of section 78fff–2(f) of this title. (b) Trustee duties To the extent consistent with the provisions of this chapter or as otherwise ordered by the