HR 2990 · 109th Congress 2005–2007, ended

Credit Rating Agency Duopoly Relief Act of 2006

Introduced Jun 20, 2005 Originated House Sponsor Michael G. Fitzpatrick R-PA

Latest action · Jul 13, 2006 Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Progress

Where this bill reached, and when. A stage with no date was not reached; one that failed a vote and later carried shows the date it carried.

IntroducedJun 20, 2005
Passed HouseJul 12, 2006
Passed SenateNot reached
To the PresidentNot reached
Became lawNot reached

Summary

Credit Rating Agency Duopoly Relief Act of 2006 - (Sec. 4) Amends the Securities Exchange Act of 1934 (Act) to define a credit rating agency as any person: (1) engaged in the business of issuing credit ratings on the Internet or through another readily accessible means, for free or for a reasonable fee, but excluding a commercial credit reporting company; (2) employing either a quantitative or qualitative model, or both, to determine credit ratings; and (3) receiving fees from either issuers, investors, or other market participants, or a combination of them.

Defines a nationally recognized statistical rating organization (NRSRO) as a credit rating agency that has been in business as a credit rating agency for at least the past three consecutive years and is registered under the Act.

Prescribes procedural requirements for mandatory NRSRO registration and certification.

Authorizes the Securities and Exchange Commission (SEC) to: (1) take action against any NRSRO that issues credit ratings in contravention of the procedures, criteria, and methodologies that it includes in its registration application or makes and disseminates in required reports; and (2) censure, restrict, suspend for a period not exceeding 12 months, or revoke NRSRO registration for violations of this Act.

Declares it is unlawful for an NRSRO to represent or imply that it has been sponsored, recommended, or approved, or that its abilities or qualifications have been passed upon, by any federal agency or officer.

States it is unlawful for an unregistered credit rating agency to declare itself an NRSRO.

Requires an NRSRO to establish and enforce written policies and procedures to: (1) prevent the misuse in violation of this Act of material, nonpublic information by itself or any associated person; and (2) address and manage potential conflicts of interest.

Grants the SEC discretion to adopt rules or regulations to prohibit, or require the management or disclosure of, any conflicts of interest relating to the issuance of credit ratings by an NRSRO.

Authorizes the SEC to adopt rules that prohibit unfair, coercive, or abusive practices relating to the issuance of credit ratings by an NRSRO.

Requires an NRSRO to: (1) designate a compliance officer for ensuring compliance with securities laws and regulations; and (2) furnish to the SEC certified statements of financial condition by an independent public accountant.

Requires the SEC staff, within 30 days of enactment of this Act, to cease designation of persons and companies as NRSRO, as the term is used under current regulations.

Declares void and of no force or effect the no-action relief that the SEC has granted with respect to the designation of certain NRSRO.

(Sec. 5) Includes an NRSRO among the financial entities required to maintain SEC-prescribed records and reports. States that any report an NRSRO may be required by SEC rules to make and disseminate to the SEC shall be deemed furnished to the SEC.

(Sec. 6) Instructs the Comptroller General to study and report to certain congressional committees on: (1) factors that have led to the consolidation of credit rating agencies; (2) the resulting impact upon securities markets; (3) the problems, if any, faced by business organizations resulting from limited competition among credit rating agencies; and (4) whether and to what extent federal or state regulations impede such competition.

Recorded votes 2

Newest first. Open one to see how every member voted.

Roll call	Question	Result	Date
House 368	On Passage	Passed255–166	Jul 12, 2006

House 367	On Agreeing to the Amendment	Failed198–222	Jul 12, 2006

Cosponsors 15

Members who signed on, in the order they did. Signatures ran from Jun 22, 2005 to May 24, 2006.

Seat	Cosponsor	Signed on
R-LA	Richard H. Baker	Jun 22, 2005
R-FL	Tom Feeney	Jun 29, 2005
R-OH	Michael G. Oxley	Jul 19, 2005
R-MO	W. Todd Akin	Jul 26, 2005
R-NJ	Scott Garrett	Jul 28, 2005
R-KY	Geoff Davis	Sep 14, 2005
R-PA	Jim Gerlach	Sep 14, 2005
R-PA	Phil English	Sep 15, 2005
R-SC	J. Gresham Barrett	Sep 21, 2005
R-FL	Mark Foley	Sep 21, 2005
R-PA	Melissa A. Hart	Sep 29, 2005
R-OH	Paul E. Gillmor	Oct 6, 2005
R-DE	Michael N. Castle	Oct 26, 2005
R-NC	Patrick T. McHenry	Dec 6, 2005
R-MO	Roy Blunt	May 24, 2006

Committees 2

Where it was sent and what each committee and subcommittee did with it, in order.

Chamber	Committee	What it did
House	Financial Services Committee	Referred Jun 20, 2005Markup Jun 14, 2006Reported Jul 7, 2006
Senate	Banking, Housing, and Urban Affairs Committee	Referred Jul 13, 2006

Actions 23

Everything that happened, newest first.

Jul 13, 2006Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.
Jul 12, 2006Rule H. Res. 906 passed House.
Jul 12, 2006Considered under the provisions of rule H. Res. 906. (consideration: CR H5080-5094; text of measure as reported in House: CR H5087-5089)
Jul 12, 2006Rule provides for consideration of H.R. 2990 with 1 hour of general debate. Previous question shall be considered as ordered without intervening motions except motion to recommit with or without instructions. Measure will be considered read. Specified amendments are in order.
Jul 12, 2006House resolved itself into the Committee of the Whole House on the state of the Union pursuant to H. Res. 906 and Rule XVIII.
Jul 12, 2006The Speaker designated the Honorable John Boozman to act as Chairman of the Committee.
Jul 12, 2006GENERAL DEBATE - The Committee of the Whole proceeded with one hour of general debate on H.R. 2990.
Jul 12, 2006DEBATE - Pursuant to the provisions of H. Res. 906, the Committee of the Whole proceeded with 10 minutes of debate on the Oxley amendment.
Jul 12, 2006DEBATE - Pursuant to the provisions of H. Res. 906, the Committee of the Whole proceeded with 20 minutes of debate on the Kanjorski amendment.
Jul 12, 2006The House rose from the Committee of the Whole House on the state of the Union to report H.R. 2990.
Jul 12, 2006The previous question was ordered pursuant to the rule. (consideration: CR H5094)
Jul 12, 2006The House adopted the amendment in the nature of a substitute as agreed to by the Committee of the Whole House on the state of the Union.
Jul 12, 2006Passed/agreed to in House: On passage Passed by recorded vote: 255 - 166 (Roll no. 368).
Jul 12, 2006Motion to reconsider laid on the table Agreed to without objection.
Jul 10, 2006Rules Committee Resolution H. Res. 906 Reported to House. Rule provides for consideration of H.R. 2990 with 1 hour of general debate. Previous question shall be considered as ordered without intervening motions except motion to recommit with or without instructions. Measure will be considered read. Specified amendments are in order.
Jul 7, 2006Reported (Amended) by the Committee on Financial Services. H. Rept. 109-546.
Jul 7, 2006Placed on the Union Calendar, Calendar No. 306.
Jun 29, 2006Mr. Price (GA) asked unanimous consent that the Committee on Financial Services have until 12:00 p.m. on July 7 to file a report on H.R. 2990. Agreed to without objection.
Jun 14, 2006Committee Consideration and Mark-up Session Held.
Jun 14, 2006Ordered to be Reported (Amended) by Voice Vote.
Jun 28, 2005Sponsor introductory remarks on measure. (CR H5255)
Jun 20, 2005Introduced in House
Jun 20, 2005Referred to the House Committee on Financial Services.

In the Congressional Record 2

Days the Record’s own index lists this bill, newest first, with the pages and the members it names. Pages starting H are the House, S the Senate, E Extensions of Remarks.

Where	In the Record	Members	Date
House	Debate and remarks H5056–H5062, H5080–H5094, H5095Text printed H5056, H5087–H5089Amendments H5062, H5087, H5089, H5090Recorded votes H5078, H5079, H5093, H5094consideration (H. Res. 906), previous questionenactKanjorski amendment (substitute)	Barney Frank D-MA, Carolyn B. Maloney D-NY, David R. Obey D-WI, Doris O. Matsui D-CA (amendment), Earl Pomeroy D-ND, James P. McGovern D-MA, Melissa A. Hart R-PA, Michael G. Fitzpatrick R-PA, Michael G. Oxley R-OH (amendment), Patrick T. McHenry R-NC, Paul E. Kanjorski D-PA (amendment), Richard H. Baker R-LA, Rush Holt D-NJ, Shelley Moore Capito R-WV, Steny H. Hoyer D-MD, Tom Price R-GA	Jul 12, 2006
House	Debate and remarks H5255	Michael G. Fitzpatrick R-PA	Jun 28, 2005

Research

What has been written about this bill: committee reports, cost estimates, the sponsor’s authority statement, printed hearings and the Congressional Research Service’s work.

Committee report

H. Rept. 109-546

Congressional Budget Office cost estimates 2

Jun 29, 2006H.R. 2990, Credit Rating Agency Duopoly Relief Act of 2006<p>Cost estimate for the bill as ordered reported by the House Committee on Financial Services on June 14, 2006</p>
Jun 29, 2006H.R. 2990, Credit Rating Agency Duopoly Relief Act of 2006Cost estimate for the bill as ordered reported by the House Committee on Financial Services on June 14, 2006

Printed hearings 4

Hearings whose printed record names this bill, newest first: hearings on it, and wider hearings where it came up.

Number	Hearing	Committee	Held
Serial No. 109-90	PROTECTING INVESTORS AND FOSTERING EFFICIENT MARKETS: A REVIEW OF THE SEC AGENDA77 pages	Financial Services Committee	May 3, 2006
S. Hrg. 109-997	ASSESSING THE CURRENT OVERSIGHT AND OPERATIONS OF CREDIT RATING AGENCIES64 pages	Banking, Housing, and Urban Affairs Committee	Mar 7, 2006
Serial No. 109-66	H.R. 299096 pages	Financial Services Committee	Nov 29, 2005
Serial No. 109-42	LEGISLATIVE SOLUTIONS FOR THE RATING AGENCY DUOPOLY156 pages	Financial Services Committee	Jun 29, 2005

CRS reports 1

Congressional Research Service work that CRS links to this bill or the law it became, newest first.

Cite it 1

Products on other subjects that cite it, usually among other measures.

Product	Title	Kind	Published
R40613	Credit Rating Agencies and Their Regulation Archived	Report	Apr 9, 2010

Amendments 2

Amendments offered to this bill.

Amendment	Description	Offered by	Status
HAmdt 1180	An amendment numbered 1 printed in House Report 109-550 to clarify that there is no private right of action for rating agencies registered as `Nationally Recognized Statistical Rating Organizations' or `NRSROs' under the Securities Exchange Act of 1934; allot to the Securities and Exchange Commission (SEC) an additional six months for a total of one year to review and, if necessary, revise its regulations that use the term `NRSRO.'; and make a number of technical amendments clarifying definitions, findings, and disclosure requirements.	Michael G. Oxley R-OH	On agreeing to the Oxley amendment (A001) Agreed to by voice vote.
HAmdt 1181	An amendment in the nature of a substitute numbered 2 printed in House Report 109-550 to establish a globally consistent, market-based approach to rating agency oversight and protects investors by maintaining quality as a factor in identifying Nationally Recognized Statistical Rating Organizations (NRSRO); require the SEC to complete its definitional rulemaking on what constitutes an NRSRO within 60 days of enactment and establish public guidelines about the process used to identify new NRSROs within 180 days of enactment. encourage participating parties to expedite and complete their ongoing discussions over the Voluntary Framework, consistent with the European Commission's adoption of the International Organization of Securities Commissions' self-regulatory model, to improve market discipline and enhance rating quality; and would require annual hearings for five years on rating agencies before the House Financial Services Committee to explore the effectiveness of the prior two reforms and determine the need for further action.	Paul E. Kanjorski D-PA	On agreeing to the Kanjorski amendment (A002) Failed by recorded vote: 198 - 222 (Roll no. 367).

Related bills 2

Companion bills and other measures the record links to this one.

Bill	Title	Relationship	Latest action
HRES 906	Providing for consideration of the bill (H.R. 2990) to improve ratings quality by fostering competition, transparency, and accountability in the credit rating agency industry.	Procedurally related	Jul 12, 2006
S 3850	Credit Rating Agency Reform Act of 2006	Related bill	Sep 29, 2006

Titles 4

Every title it has carried, official and short, at each stage.

Official Title as Introduced: To improve ratings quality by fostering competition, transparency, and accountability in the credit rating agency industry.
Short Titles as Introduced: Credit Rating Agency Duopoly Relief Act of 2005
Short Titles as Reported to House: Credit Rating Agency Duopoly Relief Act of 2006
Short Titles as Passed House: Credit Rating Agency Duopoly Relief Act of 2006

Subjects

Assigned by the Library of Congress. Policy area: Finance and Financial Sector.

Text 4

Each version as it was printed, newest first.

Jul 13, 2006Referred in Senate
Jul 12, 2006Engrossed in House
Jul 7, 2006Reported in House
Jun 20, 2005Introduced in House

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Everything here is as published by Congress: the summary is the Congressional Research Service's, the action wording is the clerks', and the subjects are the Library of Congress's. How far it got is read from the actions themselves, taking the most recent one of each kind, so a bill that failed a vote and later passed is shown as having passed. Records come from this bill on Congress.gov and govinfo.gov; cost estimates are the Congressional Budget Office's, and the hearings are the printed hearings GovInfo publishes, which can appear months after the hearing.