Taxpayer Protection and Responsible Resolution Act

1/11/2023, 1:30 PM

Taxpayer Protection and Responsible Resolution Act

This bill amends federal bankruptcy law with respect to a "covered financial corporation" incorporated or organized under any federal or state law (other than a stockbroker, a commodity broker, or a domestic or foreign insurance company or financial institution meeting certain criteria) that is: (1) a bank holding company; or (2) a corporation that exists for the primary purpose of owning, controlling, and financing subsidiaries predominantly engaged in activities that are financial in nature or incidental to such an activity.

The bill adds "Chapter 14 - Liquidation, Reorganization, or Recapitalization of a Covered Financial Corporation," setting forth requirements and prohibitions regarding: (1) commencement of a case concerning a covered financial corporation; (2) a special trustee and bridge company; (3) special transfer of the property of the estate in bankruptcy; (4) treatment of qualified financial contracts and affiliate contracts; (5) licenses, permits, and registrations; (6) exemption from securities laws; and (7) inapplicability of certain avoiding powers.

A court may convert a case under chapter 14 to chapter 7 (Liquidation) if certain conditions are met.

The Judicial Code is amended to require the Chief Justice of the United States to designate at least 10 bankruptcy judges to be available to hear a bankruptcy case under chapter 14.

The bill prescribes requirements for assignment of bankruptcy judges to chapter 14 cases.

The Dodd-Frank Wall Street Reform and Consumer Protection Act is amended to repeal Title II (Orderly Liquidation Authority), governing the bankruptcy of financial institutions. Makes conforming amendments to the Federal Deposit Insurance Act and the Federal Reserve Act.

The Federal Reserve Act is amended to prohibit a Federal Reserve bank from making advances for the purpose of providing debtor-in-possession financing to either: (1) a bridge company, or (2) a covered financial corporation that is a debtor in a pending case under Chapter 14.

No funds appropriated to the federal government may be paid to a covered financial corporation or to any of its creditors to satisfy a claim in a case under chapter 14.

Congress
114

Number
S - 1840

Introduced on
2015-07-22

# Amendments
0

Sponsors
+5

Cosponsors
+5

Variations and Revisions

7/22/2015

Status of Legislation

Bill Introduced
Introduced to House
House to Vote
Introduced to Senate
Senate to Vote

Purpose and Summary

Taxpayer Protection and Responsible Resolution Act

This bill amends federal bankruptcy law with respect to a "covered financial corporation" incorporated or organized under any federal or state law (other than a stockbroker, a commodity broker, or a domestic or foreign insurance company or financial institution meeting certain criteria) that is: (1) a bank holding company; or (2) a corporation that exists for the primary purpose of owning, controlling, and financing subsidiaries predominantly engaged in activities that are financial in nature or incidental to such an activity.

The bill adds "Chapter 14 - Liquidation, Reorganization, or Recapitalization of a Covered Financial Corporation," setting forth requirements and prohibitions regarding: (1) commencement of a case concerning a covered financial corporation; (2) a special trustee and bridge company; (3) special transfer of the property of the estate in bankruptcy; (4) treatment of qualified financial contracts and affiliate contracts; (5) licenses, permits, and registrations; (6) exemption from securities laws; and (7) inapplicability of certain avoiding powers.

A court may convert a case under chapter 14 to chapter 7 (Liquidation) if certain conditions are met.

The Judicial Code is amended to require the Chief Justice of the United States to designate at least 10 bankruptcy judges to be available to hear a bankruptcy case under chapter 14.

The bill prescribes requirements for assignment of bankruptcy judges to chapter 14 cases.

The Dodd-Frank Wall Street Reform and Consumer Protection Act is amended to repeal Title II (Orderly Liquidation Authority), governing the bankruptcy of financial institutions. Makes conforming amendments to the Federal Deposit Insurance Act and the Federal Reserve Act.

The Federal Reserve Act is amended to prohibit a Federal Reserve bank from making advances for the purpose of providing debtor-in-possession financing to either: (1) a bridge company, or (2) a covered financial corporation that is a debtor in a pending case under Chapter 14.

No funds appropriated to the federal government may be paid to a covered financial corporation or to any of its creditors to satisfy a claim in a case under chapter 14.

Alternative Names
Official Title as IntroducedA bill to amend title 11, United States Code, to provide for the liquidation, reorganization, or recapitalization of a covered financial corporation, and for other purposes.

Policy Areas
Finance and Financial Sector

Potential Impact
Administrative law and regulatory procedures
Banking and financial institutions regulation
Bankruptcy
Contracts and agency
Corporate finance and management
Federal Deposit Insurance Corporation (FDIC)
Judges
Judicial review and appeals
Licensing and registrations
Securities

Comments

Recent Activity

Latest Summary3/9/2016

Taxpayer Protection and Responsible Resolution Act

This bill amends federal bankruptcy law with respect to a "covered financial corporation" incorporated or organized under any federal or state law (other than a stockbrok...


Latest Action7/29/2015
Committee on Banking, Housing, and Urban Affairs Subcommittee on Financial Institutions and Consumer Protection. Hearings held.