15 U.S.C. § 686 — Aggregate limitations on amount of assist-

Page 1100 TITLE 15—COMMERCE AND TRADE § 686 years, if the company finds that such extension or renewal will aid in the orderly liquidation of such loan. (Pub. L. 85–699, title III, § 305, Aug. 21, 1958, 72 Stat. 693; Pub. L. 87–341, § 6, Oct. 3, 1961, 75 Stat. 753; Pub. L. 94–305, title I, § 105, June 4, 1976, 90 Stat. 666; Pub. L. 102–366, title IV, § 411, Sept. 4, 1992, 106 Stat. 1018.) Editorial Notes REFERENCES IN TEXT For definition of ‘‘this chapter’’, referred to in sub- sec. (c), see References in Text note set out under sec- tion 661 of this title. AMENDMENTS 1992—Subsec. (c). Pub. L. 102–366 inserted before pe- riod at end ‘‘: Provided, That the Administration also shall permit those companies which have issued deben- tures pursuant to this chapter to charge a maximum rate of interest based upon the coupon rate of interest on the outstanding debentures, determined on an an- nual basis, plus such other expenses of the company as may be approved by the Administration’’. 1976—Subsec. (b). Pub. L. 94–305 struck out provision that in agreements to participate in loans on a deferred basis, the participation by the company shall not be in excess of 90 percentum of the balance of the loan out- standing at the time of disbursement. 1961—Subsec. (b). Pub. L. 87–341 substituted ‘‘other lenders, incorporated or unincorporated’’ for ‘‘other lending institutions’’. Statutory Notes and Related Subsidiaries EFFECT OF SMALL BUSINESS EQUITY ENHANCEMENT ACT OF 1992 ON SECURITIES LAWS Nothing in amendment by Pub. L. 102–366 to be con- strued to affect applicability of securities laws or to otherwise supersede or limit jurisdiction of Securities and Exchange Commission, see section 418 of Pub. L. 102–366, set out as a note under section 661 of this title. § 686. Aggregate limitations on amount of assist- ance to any single enterprise (a) Percentage limitation on private capital If any small business investment company has obtained financing from the Administrator and such financing remains outstanding, the aggre- gate amount of securities acquired and for which commitments may be issued by such com- pany under the provisions of this subchapter for any single enterprise shall not, without the ap- proval of the Administrator, exceed 10 percent of the sum of— (1) the private capital of such company; and (2) the total amount of leverage projected by the company in the company’s business plan that was approved by the Administrator at the time of the grant of the company’s license. (b) Repealed. Pub. L. 92–595, § 2(f), Oct. 27, 1972, 86 Stat. 1316 (c) Application of provisions to commitments in- curred prior to effective date of section With respect to obligations or securities ac- quired prior to the effective date of the Small Business Investment Act Amendments of 1967, and with respect to legally binding commit- ments issued prior to such date, the provisions of this section as in effect immediately prior to such effective date shall continue to apply. (Pub. L. 85–699, title III, § 306, Aug. 21, 1958, 72 Stat. 694; Pub. L. 87–341, § 7(a), Oct. 3, 1961, 75 Stat. 753; Pub. L. 88–273, § 4, Feb. 28, 1964, 78 Stat. 146; Pub. L. 90–104, title II, § 207, Oct. 11, 1967, 81 Stat. 271; Pub. L. 92–595, § 2(f), Oct. 27, 1972, 86 Stat. 1316; Pub. L. 102–366, title IV, § 408(a), Sept. 4, 1992, 106 Stat. 1016; Pub. L. 111–5, div. A, title V, § 505(b), Feb. 17, 2009, 123 Stat. 156.) Editorial Notes REFERENCES IN TEXT For effective date of the Small Business Investment Act Amendments of 1967, referred to in subsec. (c), see Effective Date of 1967 Amendment note set out under section 681 of this title. AMENDMENTS 2009—Subsec. (a). Pub. L. 111–5 amended subsec. (a) generally. Prior to amendment, text read as follows: ‘‘If any small business investment company has obtained financing from the Administration and such financing remains outstanding, the aggregate amount of obliga- tions and securities acquired and for which commit- ments may be issued by such company under the provi- sions of this subchapter for any single enterprise shall not exceed 20 per centum of the private capital of such company, without the approval of the Administration.’’ 1992—Subsec. (a). Pub. L. 102–366 amended subsec. (a) generally. Prior to amendment, subsec. (a) read as fol- lows: ‘‘Without the approval of the Administration, the aggregate amount of obligations and securities ac- quired and for which commitments may be issued by any small business investment company under the pro- visions of this chapter for any single enterprise shall not exceed 20 percent of the combined private paid-in capital and paid-in surplus of such company.’’ 1972—Subsec. (a). Pub. L. 92–595, § 2(f)(1), substituted ‘‘combined private paid-in capital’’ for ‘‘combined paid- in capital’’. Subsec. (b). Pub. L. 92–595, § 2(f)(2), repealed subsec. (b) which enumerated the items making up the com- bined paid-in capital and paid-in surplus of companies licensed prior to January 1, 1968. 1967—Subsec. (a). Pub. L. 90–104 substituted ‘‘paid-in capital and paid-in surplus of such company’’ for ‘‘cap- ital and surplus of such small business investment com- pany authorized by this chapter’’. Subsecs. (b), (c). Pub. L. 90–104 added subsecs. (b) and (c). 1964—Pub. L. 88–273 struck out the $500,000 limitation on amount of assistance to any single enterprise. 1961—Pub. L. 87–341 inserted ‘‘or (2) $500,000, which- ever is the lesser’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1967 AMENDMENT Amendment by Pub. L. 90–104 effective Jan. 1, 1968, see section 211 of Pub. L. 90–104, set out as a note under section 681 of this title. EFFECTIVE DATE OF 1961 AMENDMENT Pub. L. 87–341, § 7(b), Oct. 3, 1961, 75 Stat. 753, provided that: ‘‘The amendment made by subsection (a) [amend- ing this section] shall apply only with respect to obli- gations and securities acquired by a small business in- vestment company on or after the date of the enact- ment of this Act [Oct. 3, 1961]; except that such amend- ment shall not apply with respect to any obligations or securities so acquired pursuant to a commitment issued before such date.’’ EFFECT OF SMALL BUSINESS EQUITY ENHANCEMENT ACT OF 1992 ON SECURITIES LAWS Nothing in amendment by Pub. L. 102–366 to be con- strued to affect applicability of securities laws or to Page 1101 TITLE 15—COMMERCE AND TRADE § 687 otherwise supersede or limit jurisdiction of Securities and Exchange Commission, see section 418 of Pub. L. 102–366, set out as a note under section 661 of this title. § 687. Operation and regulation of companies (a) Cooperation with banks and other financial institutions Wherever practicable the operations of a small business investment company, including the generation of business, may be undertaken in cooperation with banks or other investors or lenders, incorporated or unincorporated, and any servicing or initial investigation required for loans or acquisitions of securities by the company under the provisions of this chapter may be handled through such banks or other in- vestors or lenders on a fee basis. Any small busi- ness investment company may receive fees for services rendered to such banks and other inves- tors and lenders. (b) Use of advisory services; depository or fiscal agents; investment of funds Each small business investment company may make use, wherever practicable, of the advisory services of the Federal Reserve System and of the Department of Commerce which are avail- able for and useful to industrial and commercial businesses, and may provide consulting and ad- visory services on a fee basis and have on its staff persons competent to provide such serv- ices. Any Federal Reserve bank is authorized to act as a depository or fiscal agent for any com- pany operating under provisions of this chapter. Any such company that is licensed before Octo- ber 1, 2004 and has outstanding financings is au- thorized to invest funds not needed for its oper- ations— (1) in direct obligations of, or obligations guaranteed as to principal and interest by, the United States; (2) in certificates of deposit or other ac- counts of federally insured banks or other fed- erally insured depository institutions, if the certificates or other accounts mature or are otherwise fully available not more than 1 year after the date of the investment; or (3) in mutual funds, securities, or other in- struments that consist of, or represent pooled assets of, investments described in paragraphs (1) or (2). (c) Rules and regulations The Administration is authorized to prescribe regulations governing the operations of small business investment companies, and to carry out the provisions of this chapter, in accordance with the purposes of this chapter. (d) Forfeiture of rights, privileges, and fran- chises; jurisdiction Should any small business investment com- pany violate or fail to comply with any of the provisions of this chapter or of regulations pre- scribed hereunder, all of its rights, privileges, and franchises derived therefrom may thereby be forfeited. Before any such company shall be declared dissolved, or its rights, privileges, and franchises forfeited, any noncompliance with or violation of this chapter shall be determined and adjudged by a court of the United States of com- petent jurisdiction in a suit brought for that purpose in the district, territory, or other place subject to the jurisdiction of the United States, in which the principal office of such company is located. Any such suit shall be brought by the United States at the instance of the Administra- tion or the Attorney General. (e) Liability of United States Except as expressly provided otherwise in this chapter, nothing in this chapter or in any other provision of law shall be deemed to impose any liability on the United States with respect to any obligation entered into, or stocks issued, or commitments made, by any company operating under the provisions of this chapter. (f) Performance of functions, powers, and duties by Administration and Administrator In the performance of, and with respect to the functions, powers, and duties vested by this chapter, the Administrator and the Administra- tion shall (in addition to any authority other- wise vested by this chapter) have the functions, powers, and duties set forth in the Small Busi- ness Act [15 U.S.C. 631 et seq.], and the provi- sions of sections 13 and 16 of that Act [15 U.S.C. 642, 645], insofar as applicable, are extended to the functions of the Administrator and the Ad- ministration under this chapter. (g) Annual report on Small Business Investment activities (1) The Administration shall include in its an- nual report, made pursuant to section 10(a) of the Small Business Act [15 U.S.C. 639(a)], a full and detailed account of its operations under this chapter. Such report shall set forth the amount of losses sustained by the Government as a re- sult of such operations during the preceding fis- cal year, together with an estimate of the total losses which the Government can reasonably ex- pect to incur as a result of such operations dur- ing the then current fiscal year. (2) In its annual report for the year ending De- cember 31, 1967, and in each succeeding annual report made pursuant to section 10(a) of the Small Business Act [15 U.S.C. 639(a)], the Ad- ministration shall include full and detailed ac- counts relative to the following matters: (A) The Administration’s recommendations with respect to the feasibility and organiza- tion of a small business capital bank to en- courage private financing of small business in- vestment companies to replace Government fi- nancing of such companies. (B) The Administration’s plans to insure the provision of small business investment com- pany financing and licensing to all areas of the country and to all eligible small business concerns including steps taken to accomplish same. (C) Steps taken by the Administration to improve the number of licensees in under- licensed States. (D) The Administration’s plans to support States that seek to increase the number of li- censees in the State. (E) Steps taken by the Administration to maximize recoupment of Government funds in- cident to the inauguration and administration of the small business investment company program and to insure compliance with statu-