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115th Congress } { Rept. 115-804
HOUSE OF REPRESENTATIVES
2d Session } { Part 1
======================================================================
INTERNATIONAL INSURANCE STANDARDS ACT OF 2017
_______
July --, 2018.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Hensarling, from the Committee on Financial Services, submitted the
following
R E P O R T
[To accompany H.R. 4537]
[Including cost estimate of the Congressional Budget Office]
The Committee on Financial Services, to whom was referred
the bill (H.R. 4537) to preserve the State-based system of
insurance regulation and provide greater oversight of and
transparency on international insurance standards setting
processes, and for other purposes, having considered the same,
report favorably thereon with an amendment and recommend that
the bill as amended do pass.
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``International Insurance Standards Act
of 2018''.
SEC. 2. CONGRESSIONAL FINDINGS.
The Congress finds the following:
(1) The State-based system for insurance regulation in the
United States has served American consumers well for more than
150 years and has fostered an open and competitive marketplace
with a diversity of insurance products to the benefit of
policyholders and consumers.
(2) Protecting policyholders by regulating to ensure an
insurer's ability to pay claims has been the hallmark of the
successful United States system and should be the paramount
objective of domestic prudential regulation and emerging
international standards.
(3) The Dodd-Frank Wall Street Reform and Consumer Protection
Act (Public Law 111-203) reaffirmed the State-based insurance
regulatory system.
SEC. 3. REQUIREMENT THAT INSURANCE STANDARDS REFLECT UNITED STATES
POLICY.
(a) Requirement.--Parties representing the Federal Government in any
international regulatory, standard-setting, or supervisory forum or in
any negotiations of any international agreements relating to the
prudential aspects of insurance shall not agree to, accede to, accept,
or establish, and shall use their voice and shall vote to oppose, any
proposed agreement or standard, including proposals developed by the
International Association of Insurance Supervisors (or a successor
entity), unless such proposed agreement or standard--
(1) is consistent with and reflective of the existing United
States system of insurance regulation, including the primacy of
policyholder protection in solvency regulation; and
(2) recognizes the existing United States system of insurance
regulation as satisfying such proposals.
(b) Federal Insurance Office Functions.--Subparagraph (E) of section
313(c)(1) of title 31, United States Code, is amended by inserting
``Department of the Treasury of the'' before ``United States''.
(c) Negotiations.--Nothing in this section shall be construed to
prevent participation in negotiations of any proposed agreement or
standard.
SEC. 4. STATE INSURANCE REGULATOR INVOLVEMENT IN INTERNATIONAL STANDARD
SETTING.
In developing international insurance standards pursuant to section
3, and throughout the negotiations of such standards, parties
representing the Federal Government shall, on matters related to
insurance, closely consult, coordinate with, and include in such
meetings, State insurance commissioners or, at the option of the State
insurance commissioners, designees of the insurance commissioners
acting at their direction.
SEC. 5. CONSULTATIONS.
(a) Consultation With Congress.--Before initiating negotiations to
enter into an agreement under section 3, during such negotiations, and
before entering into any such agreement, parties representing the
Federal Government shall provide written notice to and consult with the
Committee on Financial Services of the House of Representatives and the
Committee on Banking, Housing, and Urban Affairs of the Senate, and any
other relevant committees of jurisdiction, regarding--
(1) the intention of the United States to participate in or
enter into such negotiations;
(2) the nature and objectives of the negotiations;
(3) the implementation of the agreement, including how it is
consistent with and does not materially differ from or
otherwise affect Federal or State laws or regulations;
(4) the impact on the competitiveness of United States
insurers; and
(5) the impact on United States consumers.
(b) Consultation With Federal Advisory Committee on Insurance.--
Before entering into an agreement under section 3, the Secretary of the
Treasury shall consult with the Federal Advisory Committee on Insurance
formed pursuant to section 313(h) of title 31, United States Code.
(c) Submission and Layover Provisions.--Parties representing the
Federal Government may not sign the final text or otherwise agree to,
accept, or establish an agreement under section 3 that would not have
the force and effect of law before--
(1) such parties submit to the committees specified in
subsection (a), on a day in which both Houses of Congress are
in session, a copy of the final legal text of the agreement;
and
(2) the later of--
(A) the expiration of 90-day period beginning on the
date on which the copy of the final legal text of the
agreement is submitted to the congressional committees
under paragraph (1); or
(B) if the President has vetoed a joint resolution
described in section 6(b) relating to the agreement,
the expiration of the 15-day period described in
section 6(a)(2).
(d) Delivery of Documents to Both Houses.--Whenever, pursuant to this
section, written notice or a document is required to be transmitted to
the Congress, copies of such notice or document shall be delivered to
both Houses of Congress on the same day and shall be delivered to the
Clerk of the House of Representatives if the House is not in session
and to the Secretary of the Senate if the Senate is not in session.
SEC. 6. CONGRESSIONAL REVIEW.
(a) Disapproval.--
(1) In general.--In the case of any agreement under section 3
that would not have the force and effect of law, the United
States shall not be considered a party to such agreement if,
before the expiration of the 90-day period beginning on the day
that the final legal text of the agreement is submitted to the
Congress pursuant to section 5(c)(1), a joint resolution
described in subsection (b) is enacted into law.
(2) Veto.--If the President vetoes the joint resolution, the
joint resolution shall be treated as enacted into law before
the end of the 90-day period under paragraph (1) if both Houses
of Congress vote to override such veto on or before the later
of--
(A) the last day of such 90-day period; or
(B) the last day of the 15-day period (excluding any
day described in subsection (h)) beginning on the date
the Congress receives the veto message from the
President.
(b) Contents of Resolution.--For purposes of this section, the term
``resolution'' means only a joint resolution of the two Houses of the
Congress, that is introduced during the 60-day period beginning upon
the submission to the Congress pursuant to section 5(c)(1) of the
agreement to which such resolution relates, and the matter after the
resolving clause of which is as follows: ``That the Congress does not
approve the agreement transmitted to the Congress pursuant to section
5(c)(1) of the International Insurance Standards Act of 2017, on
______.'', the blank space being filled with the appropriate date.
(c) Reference to Committees.--All resolutions introduced in the House
of Representatives shall be referred to the Committee on Financial
Services and all resolutions introduced in the Senate shall be referred
to the Committee on Banking, Housing, and Urban Affairs.
(d) Discharge of Committees.--
(1) In general.--If the committee of either House to which a
resolution has been referred has not reported it at the end of
30 days after its introduction, not counting any day which is
excluded under subsection (h), it is in order to move either to
discharge the committee from further consideration of the
resolution or to discharge the committee from further
consideration of any other resolution introduced with respect
to the same matter, except that a motion to discharge--
(A) may only be made on the second legislative day
after the calendar day on which the Member making the
motion announces to the House his intention to do so;
and
(B) is not in order after the committee has reported
a resolution with respect to the same matter.
(2) Privilege.--A motion to discharge under paragraph (1) may
be made only by an individual favoring the resolution, and is
highly privileged in the House and privileged in the Senate;
and debate thereon shall be limited to not more than 1 hour,
the time to be divided in the House equally between those
favoring and those opposing the resolution, and to be divided
in the Senate equally between, and controlled by, the majority
leader and the minority leader or their designees. An amendment
to the motion is not in order, and it is not in order to move
to reconsider the vote by which the motion is agreed to or
disagreed to.
(e) Floor Consideration in the House.--
(1) In general.--A motion in the House of Representatives to
proceed to the consideration of a resolution shall be highly
privileged and not debatable. An amendment to the motion shall
not be in order, nor shall it be in order to move to reconsider
the vote by which the motion is agreed to or disagreed to.
(2) Debate; no reconsideration.--Debate in the House of
Representatives on a resolution shall be limited to not more
than 20 hours, which shall be divided equally between those
favoring and those opposing the resolution. A motion further to
limit debate shall not be debatable. No amendment to, or motion
to recommit, the resolution shall be in order. It shall not be
in order to move to reconsider the vote by which a resolution
is agreed to or disagreed to.
(3) Consideration of other motions.--Motions to postpone,
made in the House of Representatives with respect to the
consideration of a resolution, and motions to proceed to the
consideration of other business, shall be decided without
debate.
(4) Appeals to decisions of chair.--All appeals from the
decisions of the Chair relating to the application of the Rules
of the House of Representatives to the procedure relating to a
resolution shall be decided without debate.
(5) Applicability of rules.--Except to the extent
specifically provided in the preceding provisions of this
subsection, consideration of a resolution in the House of
Representatives shall be governed by the Rules of the House of
Representatives applicable to other resolutions in similar
circumstances.
(f) Floor Consideration in the Senate.--
(1) Motion to proceed.--A motion in the Senate to proceed to
the consideration of a resolution shall be privileged. An
amendment to the motion shall not be in order, nor shall it be
in order to move to reconsider the vote by which the motion is
agreed to or disagreed to.
(2) Debate on resolution.--Debate in the Senate on a
resolution, and all debatable motions and appeals in connection
therewith, shall be limited to not more than 20 hours, to be
equally divided between, and controlled by, the majority leader
and the minority leader or their designees.
(3) Debate on motion or appeal.--Debate in the Senate on any
debatable motion or appeal in connection with a resolution
shall be limited to not more than 1 hour, to be equally divided
between, and controlled by, the mover and the manager of the
resolution, except that in the event the manager of the
resolution is in favor of any such motion or appeal, the time
in opposition thereto, shall be controlled by the minority
leader or his designee. Such leaders, or either of them, may,
from time under their control on the passage of a resolution,
allot additional time to any Senator during the consideration
of any debatable motion or appeal.
(4) Motion to limit debate.--A motion in the Senate to
further limit debate on a resolution, debatable motion, or
appeal is not debatable. No amendment to, or motion to
recommit, a resolution is in order in the Senate.
(g) Procedures in the Senate.--
(1) Procedures.--Except as otherwise provided in this
section, the following procedures shall apply in the Senate to
a resolution to which this section applies:
(A)(i) Except as provided in clause (ii), a
resolution that has passed the House of Representatives
shall, when received in the Senate, be referred to the
Committee on Banking, Housing, and Urban Affairs for
consideration in accordance with this section.
(ii) If a resolution to which this section applies
was introduced in the Senate before receipt of a
resolution that has passed the House of
Representatives, the resolution from the House of
Representatives shall, when received in the Senate, be
placed on the calendar. If this clause applies, the
procedures in the Senate with respect to a resolution
introduced in the Senate that contains the identical
matter as the resolution that passed the House of
Representatives shall be the same as if no resolution
had been received from the House of Representatives,
except that the vote on passage in the Senate shall be
on the resolution that passed the House of
Representatives.
(B) If the Senate passes a resolution before
receiving from the House of Representatives a joint
resolution that contains the identical matter, the
joint resolution shall be held at the desk pending
receipt of the joint resolution from the House of
Representatives. Upon receipt of the joint resolution
from the House of Representatives, such joint
resolution shall be deemed to be read twice,
considered, read the third time, and passed.
(2) Non-identical resolutions.--If the texts of joint
resolutions described in this section concerning any matter are
not identical--
(A) the Senate shall vote passage on the resolution
introduced in the Senate; and
(B) the text of the joint resolution passed by the
Senate shall, immediately upon its passage (or, if
later, upon receipt of the joint resolution passed by
the House), be substituted for the text of the joint
resolution passed by the House of Representatives, and
such resolution, as amended, shall be returned with a
request for a conference between the two Houses.
(3) Consideration of veto message.--Consideration in the
Senate of any veto message with respect to a joint resolution
described in subsection (b), including consideration of all
debatable motions and appeals in connection therewith, shall be
limited to 10 hours, to be equally divided between, and
controlled by, the majority leader and the minority leader or
their designees.
(h) Computation of Period.--For purposes of subsection (a)(1) of this
section and subsection (c)(2) of section 5, the 90-day period referred
to in such subsections shall be computed by excluding--
(1) the days on which either House is not in session because
of an adjournment of more than 3 days to a day certain or an
adjournment of the Congress sine die; and
(2) any Saturday and Sunday, not excluded under paragraph
(1), when either House is not in session.
(i) Exercise of Rulemaking Power.--This section is enacted by the
Congress--
(1) as an exercise of the rulemaking power of the House of
Representatives and the Senate, respectively, and as such they
are deemed a part of the rules of each House, respectively, but
applicable only with respect to the procedure to be followed in
that House in the case of resolutions described in subsection
(b); and they supersede other rules only to the extent that
they are inconsistent therewith; and
(2) with full recognition of the constitutional right of
either House to change the rules (so far as relating to the
procedure of that House) at any time, in the same manner and to
the same extent as in the case of any other rule of that House.
(j) Rule of Construction.--This section, and any failure to enact a
resolution under this section, shall not be construed to be an
endorsement of or to establish or expand any authority to enter into or
implement an agreement described in section 3 that is not otherwise
provided for under Federal law.
SEC. 7. COVERED AGREEMENTS.
(a) Preemption of State Insurance Measures.--Subsection (f) of
section 313 of title 31, United States Code, is amended by striking
``Director'' each place such term appears and inserting ``Secretary''.
(b) Definition.--Paragraph (2) of section 313(r) of title 31, United
States Code, is amended--
(1) in subparagraph (A), by striking ``and'' at the end;
(2) in subparagraph (B), by striking the period at the end
and inserting ``; and''; and
(3) by adding at the end the following new subparagraph:
``(C) applies only on a prospective basis.''.
(c) Consultation; Submission and Layover; Congressional Review.--
Section 314 of title 31, United States Code is amended--
(1) in subsection (b)--
(A) in paragraph (2)(C), by striking ``laws'' and
inserting the following: ``and Federal law, and the
nature of any changes in the laws of the United States
or the administration of such laws that would be
required to carry out a covered agreement''; and
(B) by adding at the end the following new paragraph:
``(3) Access to negotiating texts and other documents.--
Congressional committees and staff with proper security
clearances shall be given access to United States negotiating
proposals, consolidated draft texts, and other pertinent
documents related to the negotiations, including classified
materials.'';
(2) in subsection (c)--
(A) in the matter preceding paragraph (1), by
striking ``only if--'' and inserting the following:
``only if, before signing the final legal text or
otherwise entering into the agreement--'';
(B) in paragraph (1), by striking ``congressional
committees specified in subsection (b)(1)'' and
inserting ``congressional committees and to staff with
proper security clearances''; and
(C) by striking paragraph (2) and inserting the
following new paragraph:
``(2)(A) the 90-day period beginning on the date on which the
copy of the final legal text of the agreement is submitted
under paragraph (1) to the congressional committees and staff
has expired; and
``(B) if the President has vetoed a joint resolution
described in subsection (d)(2) relating to the agreement, the
15-day period described in subsection (d)(1)(B)(ii) has
expired.''; and
(3) by adding at the end the following new subsections:
``(d) Congressional Review.--
``(1) Disapproval.--
``(A) In general.--A covered agreement shall have no
force and effect in the United States if, before the
expiration of the 90-day period beginning on the day
that the final legal text of the agreement is submitted
to the Congress pursuant to subsection (c), a joint
resolution described in paragraph (2) is enacted into
law.
``(B) Veto.--If the President vetoes the joint
resolution, the joint resolution shall be treated as
enacted into law before the end of the 90-day period
under subparagraph (A) if both Houses of Congress vote
to override such veto on or before the later of--
``(i) the last day of such 90-day period; or
``(ii) the last day of the 15-day period
(excluding any day described in paragraph (8))
beginning on the date the Congress receives the
veto message from the President.
``(2) Contents of resolutions.--For purposes of this
subsection, the term `resolution' means only a joint resolution
of the two Houses of the Congress, that is introduced during
the 60-day period beginning upon the submission to the Congress
pursuant to subsection (c) of the covered agreement to which
such resolution relates, and the matter after the resolving
clause of which is as follows: `That the Congress does not
approve the covered agreement transmitted to the Congress
pursuant to section 314(c) of title 31, United States Code, on
______.', the blank space being filled with the appropriate
date.
``(3) Reference to committees.--All resolutions introduced in
the House of Representatives shall be referred to the Committee
on Financial Services and all resolutions introduced in the
Senate shall be referred to the Committee on Banking, Housing,
and Urban Affairs.
``(4) Discharge of committees.--
``(A) In general.--If the committee of either House
to which a resolution has been referred has not
reported it at the end of 30 days after its
introduction, not counting any day which is excluded
under paragraph (8), it is in order to move either to
discharge the committee from further consideration of
the resolution or to discharge the committee from
further consideration of any other resolution
introduced with respect to the same matter, except that
a motion to discharge--
``(i) may only be made on the second
legislative day after the calendar day on which
the Member making the motion announces to the
House his intention to do so; and
``(ii) is not in order after the committee
has reported a resolution with respect to the
same matter.
``(B) Privilege.--A motion to discharge under
subparagraph (A) may be made only by an individual
favoring the resolution, and is highly privileged in
the House and privileged in the Senate; and debate
thereon shall be limited to not more than 1 hour, the
time to be divided in the House equally between those
favoring and those opposing the resolution, and to be
divided in the Senate equally between, and controlled
by, the majority leader and the minority leader or
their designees. An amendment to the motion is not in
order, and it is not in order to move to reconsider the
vote by which the motion is agreed to or disagreed to.
``(5) Floor consideration in the house.--
``(A) In general.--A motion in the House of
Representatives to proceed to the consideration of a
resolution shall be highly privileged and not
debatable. An amendment to the motion shall not be in
order, nor shall it be in order to move to reconsider
the vote by which the motion is agreed to or disagreed
to.
``(B) Debate; no reconsideration.--Debate in the
House of Representatives on a resolution shall be
limited to not more than 20 hours, which shall be
divided equally between those favoring and those
opposing the resolution. A motion further to limit
debate shall not be debatable. No amendment to, or
motion to recommit, the resolution shall be in order.
It shall not be in order to move to reconsider the vote
by which a resolution is agreed to or disagreed to.
``(C) Consideration of other motions.--Motions to
postpone, made in the House of Representatives with
respect to the consideration of a resolution, and
motions to proceed to the consideration of other
business, shall be decided without debate.
``(D) Appeals to decisions of chair.--All appeals
from the decisions of the Chair relating to the
application of the Rules of the House of
Representatives to the procedure relating to a
resolution shall be decided without debate.
``(E) Applicability of rules.--Except to the extent
specifically provided in the preceding provisions of
this paragraph, consideration of a resolution in the
House of Representatives shall be governed by the Rules
of the House of Representatives applicable to other
resolutions in similar circumstances.
``(6) Floor consideration in the senate.--
``(A) Motion to proceed.--A motion in the Senate to
proceed to the consideration of a resolution shall be
privileged. An amendment to the motion shall not be in
order, nor shall it be in order to move to reconsider
the vote by which the motion is agreed to or disagreed
to.
``(B) Debate on resolution.--Debate in the Senate on
a resolution, and all debatable motions and appeals in
connection therewith, shall be limited to not more than
20 hours, to be equally divided between, and controlled
by, the majority leader and the minority leader or
their designees.
``(C) Debate on motion or appeal.--Debate in the
Senate on any debatable motion or appeal in connection
with a resolution shall be limited to not more than 1
hour, to be equally divided between, and controlled by,
the mover and the manager of the resolution, except
that in the event the manager of the resolution is in
favor of any such motion or appeal, the time in
opposition thereto, shall be controlled by the minority
leader or his designee. Such leaders, or either of
them, may, from time under their control on the passage
of a resolution, allot additional time to any Senator
during the consideration of any debatable motion or
appeal.
``(D) Motion to limit debate.--A motion in the Senate
to further limit debate on a resolution, debatable
motion, or appeal is not debatable. No amendment to, or
motion to recommit, a resolution is in order in the
Senate.
``(7) Procedures in the senate.--
``(A) Procedures.--Except as otherwise provided in
this section, the following procedures shall apply in
the Senate to a resolution to which this subsection
applies:
``(i)(I) Except as provided in subclause
(II), a resolution that has passed the House of
Representatives shall, when received in the
Senate, be referred to the Committee on
Banking, Housing, and Urban Affairs for
consideration in accordance with this
subsection.
``(II) If a resolution to which this
subsection applies was introduced in the Senate
before receipt of a resolution that has passed
the House of Representatives, the resolution
from the House of Representatives shall, when
received in the Senate, be placed on the
calendar. If this subclause applies, the
procedures in the Senate with respect to a
resolution introduced in the Senate that
contains the identical matter as the resolution
that passed the House of Representatives shall
be the same as if no resolution had been
received from the House of Representatives,
except that the vote on passage in the Senate
shall be on the resolution that passed the
House of Representatives.
``(ii) If the Senate passes a resolution
before receiving from the House of
Representatives a joint resolution that
contains the identical matter, the joint
resolution shall be held at the desk pending
receipt of the joint resolution from the House
of Representatives. Upon receipt of the joint
resolution from the House of Representatives,
such joint resolution shall be deemed to be
read twice, considered, read the third time,
and passed.
``(B) Non-identical resolutions.--If the texts of
joint resolutions described in this subsection
concerning any matter are not identical--
``(i) the Senate shall vote passage on the
resolution introduced in the Senate; and
``(ii) the text of the joint resolution
passed by the Senate shall, immediately upon
its passage (or, if later, upon receipt of the
joint resolution passed by the House), be
substituted for the text of the joint
resolution passed by the House of
Representatives, and such resolution, as
amended, shall be returned with a request for a
conference between the two Houses.
``(C) Consideration of veto message.--Consideration
in the Senate of any veto message with respect to a
joint resolution described in paragraph (2), including
consideration of all debatable motions and appeals in
connection therewith, shall be limited to 10 hours, to
be equally divided between, and controlled by, the
majority leader and the minority leader or their
designees.
``(8) Computation of period.--For purposes of paragraph
(1)(A) of this subsection and paragraph (2)(A) of subsection
(c), the 90-day period referred to in such paragraph shall be
computed by excluding--
``(A) the days on which either House is not in
session because of an adjournment of more than 3 days
to a day certain or an adjournment of the Congress sine
die; and
``(B) any Saturday and Sunday, not excluded under
subparagraph (A), when either House is not in session.
``(9) Exercise of rulemaking power.--This subsection is
enacted by the Congress--
``(A) as an exercise of the rulemaking power of the
House of Representatives and the Senate, respectively,
and as such they are deemed a part of the rules of each
House, respectively, but applicable only with respect
to the procedure to be followed in that House in the
case of resolutions described in paragraph (2); and
they supersede other rules only to the extent that they
are inconsistent therewith; and
``(B) with full recognition of the constitutional
right of either House to change the rules (so far as
relating to the procedure of that House) at any time,
in the same manner and to the same extent as in the
case of any other rule of that House.
``(e) Requirements for Consultations.--Throughout the negotiations of
a covered agreement, parties representing the Federal Government shall
closely consult and coordinate with, and include in such meetings,
State insurance commissioners or, at the option of the State insurance
commissioners, designees of the insurance commissioners acting at their
direction.''.
Purpose and Summary
On December 4, 2017, Representative Sean Duffy introduced
H.R. 4537, the ``International Insurance Standards Act of
2017'' to preserve the State-based system of insurance
regulation and provide greater oversight and transparency on
international insurance standard negotiations.
H.R. 4537 requires that: (1) any such agreement entered
into by entities representing the United States may not be
agreed to unless it is consistent with existing federal and
state law as well as recognizing existing Federal and State
laws on the regulation of insurance; (2) federal entities
participating in negotiations must coordinate and consult with
state insurance commissioners; (3) Congress must be consulted
on negotiations prior to negotiations taking place, as well as
during and prior to entering into an agreement; (4) authority
is granted to Congress to conduct a ``fast-tracked''
disapproval process; and (5) Congress has similar disapproval
authority on covered agreements.
Background and Need for Legislation
For nearly 150 years, U.S. insurance companies of every
kind--including property-casualty, life, reinsurance, health,
and auto--have been regulated primarily by the states. Congress
and the states have occasionally reviewed the effectiveness of
the state-based regulation of insurance and coordinated efforts
to achieve greater regulatory uniformity. In 1945, Congress
passed the McCarran-Ferguson Act (15 U.S.C. 1011 et seq.),
which confirmed the states' regulatory authority over insurance
except where a federal law expressly provides otherwise.
The Dodd-Frank Wall Street Reform and Consumer Protection
Act (Dodd-Frank Act) (Pub. L. No. 111-203) enlarged the federal
government's role in the insurance industry by creating a
federal office specifically tasked with insurance matters. The
Dodd-Frank Act established a Federal Insurance Office (FIO) at
the U.S. Department of the Treasury (Treasury) and charged the
FIO director with representing the interests of U.S. insurers
during the negotiation of international agreements and advising
the Office of the U.S. Trade Representative (USTR) during trade
negotiations.
The United States' state-based regulatory framework is the
strongest and most robust insurance regulatory architecture in
the world. No other system of insurance regulation combines the
state-based focus on policyholder protection with the four,
interconnected aspects of consumer protection, solvency
protection, market-conduct protection, and resolution
protection.
However, critics of the current U.S. negotiating platform
argue that international insurance standards negotiations could
be used as a ``back-door'' method to implement European
insurance standards in the United States. The European
insurance regulatory model is bank-centric and less
policyholder friendly than the U.S. insurance regulatory
regime. H.R. 4537 would provide increased transparency
throughout the negotiation process and authorizes an approval
authority for Congress to ensure that international
negotiations recognize the primacy of the current U.S.
insurance regulatory framework.
On an ongoing basis, representatives from the United States
are involved in negotiations regarding global insurance
standards in international forums, including the International
Association of Insurance Supervisors (IAIS) in Basel,
Switzerland. The IAIS is a voluntary membership-driven
organization of insurance supervisors and regulators from over
190 jurisdictions in more than 140 countries. The IAIS does not
have executive powers, rather its role is to develop regulatory
guidelines and best practices for national insurance
supervisors to adopt. The outcomes of these discussions could
have a considerable impact on U.S. insurance companies,
markets, policyholders and consumers. H.R. 4537 would ensure
that the representatives from the United States would maintain
a strong, unified voice that will ensure that the successful,
state-based, policy-holder centric system of insurance
regulation is the model and basis for any international
discussions.
As the IAIS negotiates global capital standards,
governance, and market conduct, H.R. 4537 would position the
U.S. to participate in the discussions and protect it from
international agreements that could be detrimental to U.S.
insurers, policyholders and markets.
Hearings
The Committee on Financial Services' Subcommittee on
Housing and Insurance held a hearing examining matters relating
to H.R. 4537 on October 24, 2017.
Committee Consideration
The Committee on Financial Services met in open session on
December 12, 2017 and ordered H.R. 4537 to be reported
favorably to the House as amended by a recorded vote of 56 yeas
to 4 nays (Record vote no. FC-135), a quorum being present.
Before the motion to report was offered, the Committee adopted
an amendment offered by Mr. Duffy by voice vote.
Committee Votes
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee to list the record votes
on the motion to report legislation and amendments thereto. The
sole recorded vote was on a motion by Chairman Hensarling to
report the bill favorably to the House as amended. The motion
was agreed to by a recorded vote of 56 yeas to 4 nays (Record
vote no. FC-135), a quorum being present.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Committee Oversight Findings
Pursuant to clause 3(c)(1) of rule XIII of the Rules of the
House of Representatives, the findings and recommendations of
the Committee based on oversight activities under clause
2(b)(1) of rule X of the Rules of the House of Representatives,
are incorporated in the descriptive portions of this report.
Performance Goals and Objectives
With respect to clause 3(c)(4) of rule XIII of the Rules of
the House of Representatives, the Committee advises that the
bill contains no measure that authorizes funding, so no
statement of general performance goals and objectives for which
any measure authorizes funding is required.
New Budget Authority, Entitlement Authority, and Tax Expenditures
In compliance with clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives, the Committee adopts as its
own the estimate of new budget authority, entitlement
authority, or tax expenditures or revenues contained in the
cost estimate prepared by the Director of the Congressional
Budget Office pursuant to section 402 of the Congressional
Budget Act of 1974.
Congressional Budget Office Estimates
Pursuant to clause 3(c)(3) of rule XIII of the Rules of the
House of Representatives, the following is the cost estimate
provided by the Congressional Budget Office pursuant to section
402 of the Congressional Budget Act of 1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, February 8, 2018.
Hon. Jeb Hensarling,
Chairman, Committee on Financial Services,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 4537, the
International Insurance Standards Act of 2017.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Matthew
Pickford.
Sincerely,
Keith Hall,
Director.
Enclosure.
H.R. 4537--International Insurance Standards Act of 2017
H.R. 4537 would require negotiators of international
insurance agreements to oppose any proposal that is
inconsistent with existing federal and state laws. The bill
would require negotiators to consult with state insurance
commissioners and the Congress. The bill also would provide the
Congress with a process to disapprove of any international
insurance agreement.
Any budgetary effects of enacting H.R. 4537 would depend,
in part, on how often the United States negotiates
international insurance agreements and how frequently the
negotiators must consult and coordinate with state insurance
commissioners. CBO has no basis for predicting that frequency
but expects that the cost of such consultations would be less
than $500,000 per year.
Enacting H.R. 4537 would not affect direct spending or
revenues; therefore, pay-as-you-go procedures do not apply.
CBO estimates that enacting H.R. 4537 would not increase
net direct spending or on-budget deficits in any of the four
consecutive 10-year periods beginning in 2028.
H.R. 4537 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act.
The CBO staff contact for this estimate is Matthew
Pickford. The estimate was approved by H. Samuel Papenfuss,
Deputy Assistant Director for Budget Analysis.
Federal Mandates Statement
This information is provided in accordance with section 423
of the Unfunded Mandates Reform Act of 1995.
The Committee has determined that the bill does not contain
Federal mandates on the private sector. The Committee has
determined that the bill does not impose a Federal
intergovernmental mandate on State, local, or tribal
governments.
Advisory Committee Statement
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act were created by this
legislation.
Applicability To Legislative Branch
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of the section
102(b)(3) of the Congressional Accountability Act.
Earmark Identification
With respect to clause 9 of rule XXI of the Rules of the
House of Representatives, the Committee has carefully reviewed
the provisions of the bill and states that the provisions of
the bill do not contain any congressional earmarks, limited tax
benefits, or limited tariff benefits within the meaning of the
rule.
Duplication of Federal Programs
In compliance with clause 3(c)(5) of rule XIII of the Rules
of the House of Representatives, the Committee states that no
provision of the bill establishes or reauthorizes: (1) a
program of the Federal Government known to be duplicative of
another Federal program; (2) a program included in any report
from the Government Accountability Office to Congress pursuant
to section 21 of Public Law 111-139; or (3) a program related
to a program identified in the most recent Catalog of Federal
Domestic Assistance, published pursuant to the Federal Program
Information Act (Pub. L. No. 95-220, as amended by Pub. L. No.
98-169).
Disclosure of Directed Rulemaking
Pursuant to section 3(i) of H. Res. 5, (115th Congress),
the following statement is made concerning directed
rulemakings: The Committee estimates that the bill requires no
directed rulemakings within the meaning of such section.
Section-by-Section Analysis of the Legislation
Section 1. Short title
This section cites H.R. 4537 as the ``International
Insurance Standards Act of 2017''.
Section 2. Congressional findings
This section acknowledges that the State-based system for
insurance regulation in the United States has fostered an open
and competitive marketplace with a diversity of insurance
products to benefit policyholders and consumers. The section
also finds that the State-based system of insurance regulation
protects policyholders by regulating to ensure the insurer's
ability to pay claims, which has been a hallmark of the success
of the current United States insurance regulatory regime.
Further adds that the Dodd-Frank Wall Street Reform and
Consumer Protection Act (Public Law 111-203) reaffirmed the
State-based insurance regulatory system.
Section 3. Requirement that insurance standards reflect United States
policy
This section requires that any party negotiating
international insurance standards, on behalf of the Federal
Government, may not vote in favor of any agreement if it is
inconsistent or does not reflect the current United States
system of insurance regulation including the primacy of
policyholder protection in solvency regulation. It codifies the
primacy of the United States' system of insurance regulation
during international insurance negotiations. Additionally, this
section specifies that the Secretary of the Treasury, during
negotiations, only represents the views of the Department of
the Treasury. Nothing in this section shall be construed to
prevent participation in negotiations of any proposed agreement
or standard.
Section 4. State insurance regulator involvement in international
standard setting
This section requires entities representing the Federal
Government during international insurance negotiations to
closely consult with state insurance regulators, which includes
coordination, and inclusion in meetings. State insurance
commissioners will have the authority to submit designees in
their stead.
Section 5. Consultation with Congress
This Section requires those representatives of the Federal
government entering into international negotiations on
insurance to first notify the relevant Congressional committees
(House Committee on Financial Services and the Senate Committee
on Banking, Housing, and Urban Affairs) prior to initiating any
discussions on international standards, during negotiations,
and prior to entering into an agreement. Written consultation
with Congress includes: (1) the intention of the United States
to participate in international negotiations; (2) the nature
and objectives of such negotiations; (3) how the agreement will
be implemented; including how it is consistent with existing
federal and state laws; (4) the impact on the Competitiveness
of U.S. insurers; and, (5) the impact on U.S. consumers. This
section also requires the Secretary of Treasury to consult with
the Federal Advisory Committee on Insurance before entering
into an agreement under section 3 of this Act. The
Administration must submit the final text of the negotiation to
Congress for a 90 day layover for Congressional review before
signing the agreement.
Section 6. Congressional review
This section provides Congress with ``fast-track''
procedures for disapproval of the international negotiated
agreement. H.R. 4537 would provide for a joint resolution to be
introduced within 60 days from the date the Administration
submits the agreement to Congress. Should the relevant
Committees fail to report the resolution, a privileged motion
to discharge the Committees is in order.
Section 7. Covered agreements
Amends the Dodd-Frank Act and provides negotiating
authority to the Secretary of the Treasury, instead of the
Director of the Federal Insurance Office (FIO). Going forward,
covered agreements would not include new prudential
requirements for U.S. insurers. Additionally, this section
requires Federal negotiators to closely consult and coordinate
with state insurance commissioners, or their designees, and
also include them in meetings. This section also provides
Congress with a submission and layover period as well as a
fast-tracked disapproval process for covered agreements.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, and existing law in which no
change is proposed is shown in roman):
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, and existing law in which no
change is proposed is shown in roman):
TITLE 31, UNITED STATES CODE
* * * * * * *
SUBTITLE I--GENERAL
* * * * * * *
CHAPTER 3--DEPARTMENT OF THE TREASURY
* * * * * * *
SUBCHAPTER I--ORGANIZATION
* * * * * * *
Sec. 313. Federal Insurance Office
(a) Establishment.--There is established within the
Department of the Treasury the Federal Insurance Office.
(b) Leadership.--The Office shall be headed by a Director,
who shall be appointed by the Secretary of the Treasury. The
position of Director shall be a career reserved position in the
Senior Executive Service, as that position is defined under
section 3132 of title 5, United States Code.
(c) Functions.--
(1) Authority pursuant to direction of Secretary.--
The Office, pursuant to the direction of the Secretary,
shall have the authority--
(A) to monitor all aspects of the insurance
industry, including identifying issues or gaps
in the regulation of insurers that could
contribute to a systemic crisis in the
insurance industry or the United States
financial system;
(B) to monitor the extent to which
traditionally underserved communities and
consumers, minorities (as such term is defined
in section 1204(c) of the Financial
Institutions Reform, Recovery, and Enforcement
Act of 1989 (12 U.S.C. 1811 note)), and low-
and moderate-income persons have access to
affordable insurance products regarding all
lines of insurance, except health insurance;
(C) to recommend to the Financial Stability
Oversight Council that it designate an insurer,
including the affiliates of such insurer, as an
entity subject to regulation as a nonbank
financial company supervised by the Board of
Governors pursuant to title I of the Dodd-Frank
Wall Street Reform and Consumer Protection Act;
(D) to assist the Secretary in administering
the Terrorism Insurance Program established in
the Department of the Treasury under the
Terrorism Risk Insurance Act of 2002 (15 U.S.C.
6701 note);
(E) to coordinate Federal efforts and develop
Federal policy on prudential aspects of
international insurance matters, including
representing the Department of the Treasury of
the United States, as appropriate, in the
International Association of Insurance
Supervisors (or a successor entity) and
assisting the Secretary in negotiating covered
agreements (as such term is defined in
subsection (r));
(F) to determine, in accordance with
subsection (f), whether State insurance
measures are preempted by covered agreements;
(G) to consult with the States (including
State insurance regulators) regarding insurance
matters of national importance and prudential
insurance matters of international importance;
and
(H) to perform such other related duties and
authorities as may be assigned to the Office by
the Secretary.
(2) Advisory functions.--The Office shall advise the
Secretary on major domestic and prudential
international insurance policy issues.
(3) Advisory capacity on Council.--The Director shall
serve
in an advisory capacity on the Financial Stability Oversight
Council established under the Financial Stability Act of 2010.
(d) Scope.--The authority of the Office shall extend to all
lines of insurance except--
(1) health insurance, as determined by the Secretary
in coordination with the Secretary of Health and Human
Services based on section 2791 of the Public Health
Service Act (42 U.S.C. 300gg-91);
(2) long-term care insurance, except long-term care
insurance that is included with life or annuity
insurance components, as determined by the Secretary in
coordination with the Secretary of Health and Human
Services, and in the case of long-term care insurance
that is included with such components, the Secretary
shall coordinate with the Secretary of Health and Human
Services in performing the functions of the Office; and
(3) crop insurance, as established by the Federal
Crop Insurance Act (7 U.S.C. 1501 et seq.).
(e) Gathering of Information.--
(1) In general.--In carrying out the functions
required under subsection (c), the Office may--
(A) receive and collect data and information
on and from the insurance industry and
insurers;
(B) enter into information-sharing
agreements;
(C) analyze and disseminate data and
information; and
(D) issue reports regarding all lines of
insurance except health insurance.
(2) Collection of information from insurers and
affiliates.--
(A) In general.--Except as provided in
paragraph (3), the Office may require an
insurer, or any affiliate of an insurer, to
submit such data or information as the Office
may reasonably require in carrying out the
functions described under subsection (c).
(B) Rule of construction.--Notwithstanding
any other provision of this section, for
purposes of subparagraph (A), the term
``insurer'' means any entity that writes
insurance or reinsures risks and issues
contracts or policies in 1 or more States.
(3) Exception for small insurers.--Paragraph (2)
shall not apply with respect to any insurer or
affiliate thereof that meets a minimum size threshold
that the Office may establish, whether by order or
rule.
(4) Advance coordination.--Before collecting any data
or information under paragraph (2) from an insurer, or
affiliate of an insurer, the Office shall coordinate
with each relevant Federal agency and State insurance
regulator (or other relevant Federal or State
regulatory agency, if any, in the case of an affiliate
of an insurer) and any publicly available sources to
determine if the information to be collected is
available from, and may be obtained in a timely manner
by, such Federal agency or State insurance regulator,
individually or collectively, other regulatory agency,
or publicly available sources. If the Director
determines that such data or information is available,
and may be obtained in a timely manner, from such an
agency, regulator, regulatory agency, or source, the
Director shall obtain the data or information from such
agency, regulator, regulatory agency, or source. If the
Director determines that such data or information is
not so available, the Director may collect such data or
information from an insurer (or affiliate) only if the
Director complies with the requirements of subchapter I
of chapter 35 of title 44, United States Code (relating
to Federal information policy; commonly known as the
Paperwork Reduction Act), in collecting such data or
information. Notwithstanding any other provision of
law, each such relevant Federal agency and State
insurance regulator or other Federal or State
regulatory agency is authorized to provide to the
Office such data or information.
(5) Confidentiality.--
(A) Retention of privilege.--The submission
of any nonpublicly available data and
information to the Office under this subsection
shall not constitute a waiver of, or otherwise
affect, any privilege arising under Federal or
State law (including the rules of any Federal
or State court) to which the data or
information is otherwise subject.
(B) Continued application of prior
confidentiality agreements.--Any requirement
under Federal or State law to the extent
otherwise applicable, or any requirement
pursuant to a written agreement in effect
between the original source of any nonpublicly
available data or information and the source of
such data or information to the Office,
regarding the privacy or confidentiality of any
data or information in the possession of the
source to the Office, shall continue to apply
to such data or information after the data or
information has been provided pursuant to this
subsection to the Office.
(C) Information-sharing agreement.--Any data
or information obtained by the Office may be
made available to State insurance regulators,
individually or collectively, through an
information-sharing agreement that--
(i) shall comply with applicable
Federal law; and
(ii) shall not constitute a waiver
of, or otherwise affect, any privilege
under Federal or State law (including
the rules of any Federal or State
court) to which the data or information
is otherwise subject.
(D) Agency disclosure requirements.--Section
552 of title 5, United States Code, shall apply
to any data or information submitted to the
Office by an insurer or an affiliate of an
insurer.
(6) Subpoenas and enforcement.--The Director shall
have the power to require by subpoena the production of
the data or information requested under paragraph (2),
but only upon a written finding by the Director that
such data or information is required to carry out the
functions described under subsection (c) and that the
Office has coordinated with such regulator or agency as
required under paragraph (4). Subpoenas shall bear the
signature of the Director and shall be served by any
person or class of persons designated by the Director
for that purpose. In the case of contumacy or failure
to obey a subpoena, the subpoena shall be enforceable
by order of any appropriate district court of the
United States. Any failure to obey the order of the
court may be punished by the court as a contempt of
court.
(f) Preemption of State Insurance Measures.--
(1) Standard.--A State insurance measure shall be
preempted pursuant to this section or section 314 if,
and only to the extent that the [Director] Secretary
determines, in accordance with this subsection, that
the measure--
(A) results in less favorable treatment of a
non-United States insurer domiciled in a
foreign jurisdiction that is subject to a
covered agreement than a United States insurer
domiciled, licensed, or otherwise admitted in
that State; and
(B) is inconsistent with a covered agreement.
(2) Determination.--
(A) Notice of potential inconsistency.--
Before making any determination under paragraph
(1), the [Director] Secretary shall--
(i) notify and consult with the
appropriate State regarding any
potential inconsistency or preemption;
(ii) notify and consult with the
United States Trade Representative
regarding any potential inconsistency
or preemption;
(iii) cause to be published in the
Federal Register notice of the issue
regarding the potential inconsistency
or preemption, including a description
of each State insurance measure at
issue and any applicable covered
agreement;
(iv) provide interested parties a
reasonable opportunity to submit
written comments to the Office; and
(v) consider any comments received.
(B) Scope of review.--For purposes of this
subsection, any determination of the [Director]
Secretary regarding State insurance measures,
and any preemption under paragraph (1) as a
result of such determination, shall be limited
to the subject matter contained within the
covered agreement involved and shall achieve a
level of protection for insurance or
reinsurance consumers that is substantially
equivalent to the level of protection achieved
under State insurance or reinsurance
regulation.
(C) Notice of determination of
inconsistency.--Upon making any determination
under paragraph (1), the [Director] Secretary
shall--
(i) notify the appropriate State of
the determination and the extent of the
inconsistency;
(ii) establish a reasonable period of
time, which shall not be less than 30
days, before the determination shall
become effective; and
(iii) notify the Committees on
Financial Services and Ways and Means
of the House of Representatives and the
Committees on Banking, Housing, and
Urban Affairs and Finance of the
Senate.
(3) Notice of effectiveness.--Upon the conclusion of
the period referred to in paragraph (2)(C)(ii), if the
basis for such determination still exists, the
determination shall become effective and the [Director]
Secretary shall--
(A) cause to be published a notice in the
Federal Register that the preemption has become
effective, as well as the effective date; and
(B) notify the appropriate State.
(4) Limitation.--No State may enforce a State
insurance measure to the extent that such measure has
been preempted under this subsection.
(g) Applicability of Administrative Procedures Act.--
Determinations of inconsistency made pursuant to subsection
(f)(2) shall be subject to the applicable provisions of
subchapter II of chapter 5 of title 5, United States Code
(relating to administrative procedure), and chapter 7 of such
title (relating to judicial review), except that in any action
for judicial review of a determination of inconsistency, the
court shall determine the matter de novo.
(h) Regulations, Policies, and Procedures.--The Secretary may
issue orders, regulations, policies, and procedures to
implement this section.
(i) Consultation.--The Director shall consult with State
insurance regulators, individually or collectively, to the
extent the Director determines appropriate, in carrying out the
functions of the Office.
(j) Savings Provisions.--Nothing in this section shall--
(1) preempt--
(A) any State insurance measure that governs
any insurer's rates, premiums, underwriting, or
sales practices;
(B) any State coverage requirements for
insurance;
(C) the application of the antitrust laws of
any State to the business of insurance; or
(D) any State insurance measure governing the
capital or solvency of an insurer, except to
the extent that such State insurance measure
results in less favorable treatment of a non-
United State insurer than a United States
insurer;
(2) be construed to alter, amend, or limit any
provision of
the Consumer Financial Protection Agency Act of 2010; or
(3) affect the preemption of any State insurance
measure
otherwise inconsistent with and preempted by Federal law.
(k) Retention of Existing State Regulatory Authority.--
Nothing in this section or section 314 shall be construed to
establish or provide the Office or the Department of the
Treasury with general supervisory or regulatory authority over
the business of insurance.
(l) Retention of Authority of Federal Financial Regulatory
Agencies.--Nothing in this section or section 314 shall be
construed to limit the authority of any Federal financial
regulatory agency, including the authority to develop and
coordinate policy, negotiate, and enter into agreements with
foreign governments, authorities, regulators, and multinational
regulatory committees and to preempt State measures to affect
uniformity with international regulatory agreements.
(m) Retention of Authority of United States Trade
Representative.--Nothing in this section or section 314 shall
be construed to affect the authority of the Office of the
United States Trade Representative pursuant to section 141 of
the Trade Act of 1974 (19 U.S.C. 2171) or any other provision
of law, including authority over the development and
coordination of United States international trade policy and
the administration of the United States trade agreements
program.
(n) Annual Reports to Congress.--
(1) Section 313(f) reports.--Beginning September 30,
2011, the Director shall submit a report on or before
September 30 of each calendar year to the President and
to the Committees on Financial Services and Ways and
Means of the House of Representatives and the
Committees on Banking, Housing, and Urban Affairs and
Finance of the Senate on any actions taken by the
Office pursuant to subsection (f) (regarding preemption
of inconsistent State insurance measures).
(2) Insurance industry.--Beginning September 30,
2011, the Director shall submit a report on or before
September 30 of each calendar year to the President and
to the Committee on Financial Services of the House of
Representatives and the Committee on Banking, Housing,
and Urban Affairs of the Senate on the insurance
industry and any other information as deemed relevant
by the Director or requested by such Committees.
(o) Reports on U.S. and Global Reinsurance Market.--The
Director shall submit to the Committee on Financial Services of
the House of Representatives and the Committee on Banking,
Housing, and Urban Affairs of the Senate--
(1) a report received not later than September 30,
2012, describing the breadth and scope of the global
reinsurance market and the critical role such market
plays in supporting insurance in the United States; and
(2) a report received not later than January 1, 2013,
and updated not later than January 1, 2015, describing
the impact of part II of the Nonadmitted and
Reinsurance Reform Act of 2010 on the ability of State
regulators to access reinsurance information for
regulated companies in their jurisdictions.
(p) Study and Report on Regulation of Insurance.--
(1) In general.--Not later than 18 months after the
date of enactment of this section, the Director shall
conduct a study and submit a report to Congress on how
to modernize and improve the system of insurance
regulation in the United States.
(2) Considerations.--The study and report required
under paragraph (1) shall be based on and guided by the
following considerations:
(A) Systemic risk regulation with respect to
insurance.
(B) Capital standards and the relationship
between capital allocation and liabilities,
including standards relating to liquidity and
duration risk.
(C) Consumer protection for insurance
products and practices, including gaps in State
regulation.
(D) The degree of national uniformity of
State insurance regulation.
(E) The regulation of insurance companies and
affiliates on a consolidated basis.
(F) International coordination of insurance
regulation.
(3) Additional factors.--The study and report
required under paragraph (1) shall also examine the
following factors:
(A) The costs and benefits of potential
Federal regulation of insurance across various
lines of insurance (except health insurance).
(B) The feasibility of regulating only
certain lines of insurance at the Federal
level, while leaving other lines of insurance
to be regulated at the State level.
(C) The ability of any potential Federal
regulation or Federal regulators to eliminate
or minimize regulatory arbitrage.
(D) The impact that developments in the
regulation of insurance in foreign
jurisdictions might have on the potential
Federal regulation of insurance.
(E) The ability of any potential Federal
regulation or Federal regulator to provide
robust consumer protection for policyholders.
(F) The potential consequences of subjecting
insurance companies to a Federal resolution
authority, including the effects of any Federal
resolution authority--
(i) on the operation of State
insurance guaranty fund systems,
including the loss of guaranty fund
coverage if an insurance company is
subject to a Federal resolution
authority;
(ii) on policyholder protection,
including the loss of the priority
status of policyholder claims over
other unsecured general creditor
claims;
(iii) in the case of life insurance
companies, on the loss of the special
status of separate account assets and
separate account liabilities; and
(iv) on the international
competitiveness of insurance companies.
(G) Such other factors as the Director
determines necessary or appropriate, consistent
with the principles set forth in paragraph (2).
(4) Required recommendations.--The study and report
required under paragraph (1) shall also contain any
legislative, administrative, or regulatory
recommendations, as the Director determines
appropriate, to carry out or effectuate the findings
set forth in such report.
(5) Consultation.--With respect to the study and
report required under paragraph (1), the Director shall
consult with the State insurance regulators, consumer
organizations, representatives of the insurance
industry and policyholders, and other organizations and
experts, as appropriate.
(q) Use of Existing Resources.--To carry out this section,
the Office may employ personnel, facilities, and any other
resource of the Department of the Treasury available to the
Secretary and the Secretary shall dedicate specific personnel
to the Office.
(r) Definitions.--In this section and section 314, the
following definitions shall apply:
(1) Affiliate.--The term ``affiliate'' means, with
respect to an insurer, any person who controls, is
controlled by, or is under common control with the
insurer.
(2) Covered agreement.--The term ``covered
agreement'' means a written bilateral or multilateral
agreement regarding prudential measures with respect to
the business of insurance or reinsurance that--
(A) is entered into between the United States
and one or more foreign governments,
authorities, or regulatory entities; [and]
(B) relates to the recognition of prudential
measures with respect to the business of
insurance or reinsurance that achieves a level
of protection for insurance or reinsurance
consumers that is substantially equivalent to
the level of protection achieved under State
insurance or reinsurance regulation[.]; and
(C) applies only on a prospective basis.
(3) Insurer.--The term ``insurer'' means any person
engaged in the business of insurance, including
reinsurance.
(4) Federal financial regulatory agency.--The term
``Federal financial regulatory agency'' means the
Department of the Treasury, the Board of Governors of
the Federal Reserve System, the Office of the
Comptroller of the Currency, the Office of Thrift
Supervision, the Securities and Exchange Commission,
the Commodity Futures Trading Commission, the Federal
Deposit Insurance Corporation, the Federal Housing
Finance Agency, or the National Credit Union
Administration.
(5) Non-United States insurer.--The term ``non-United
States insurer'' means an insurer that is organized
under the laws of a jurisdiction other than a State,
but does not include any United States branch of such
an insurer.
(6) Office.--The term ``Office'' means the Federal
Insurance Office established by this section.
(7) State insurance measure.--The term ``State
insurance measure'' means any State law, regulation,
administrative ruling, bulletin, guideline, or practice
relating to or affecting prudential measures applicable
to insurance or reinsurance.
(8) State insurance regulator.--The term ``State
insurance regulator'' means any State regulatory
authority responsible for the supervision of insurers.
(9) Substantially equivalent to the level of
protection achieved.--The term ``substantially
equivalent to the level of protection achieved'' means
the prudential measures of a foreign government,
authority, or regulatory entity achieve a similar
outcome in consumer protection as the outcome achieved
under State insurance or reinsurance regulation.
(10) United States insurer.--The term ``United States
insurer'' means--
(A) an insurer that is organized under the
laws of a State; or
(B) a United States branch of a non-United
States insurer.
(s) Authorization of Appropriations.--There are authorized to
be appropriated for the Office for each fiscal year such sums
as may be necessary.
Sec. 314. Covered agreements
(a) Authority.--The Secretary and the United States Trade
Representative are authorized, jointly, to negotiate and enter
into covered agreements on behalf of the United States.
(b) Requirements for Consultation With Congress.--
(1) In general.--Before initiating negotiations to
enter into a covered agreement under subsection (a),
during such negotiations, and before entering into any
such agreement, the Secretary and the United States
Trade Representative shall jointly consult with the
Committee on Financial Services and the Committee on
Ways and Means of the House of Representatives and the
Committee on Banking, Housing, and Urban Affairs and
the Committee on Finance of the Senate.
(2) Scope.--The consultation described in paragraph
(1) shall include consultation with respect to--
(A) the nature of the agreement;
(B) how and to what extent the agreement will
achieve the applicable purposes, policies,
priorities, and objectives of section 313 and
this section; and
(C) the implementation of the agreement,
including the general effect of the agreement
on existing State [laws] and Federal law, and
the nature of any changes in the laws of the
United States or the administration of such
laws that would be required to carry out a
covered agreement.
(3) Access to negotiating texts and other
documents.--Congressional committees and staff with
proper security clearances shall be given access to
United States negotiating proposals, consolidated draft
texts, and other pertinent documents related to the
negotiations, including classified materials.
(c) Submission and Layover Provisions.--A covered agreement
under subsection (a) may enter into force with respect to the
United States [only if--] only if, before signing the final
legal text or otherwise entering into the agreement--
(1) the Secretary and the United States Trade
Representative jointly submit to the [congressional
committees specified in subsection (b)(1)]
congressional committees and to staff with proper
security clearances, on a day on which both Houses of
Congress are in session, a copy of the final legal text
of the agreement; and
[(2) a period of 90 calendar days beginning on the
date on which the copy of the final legal text of the
agreement is submitted to the congressional committees
under paragraph (1) has expired.]
(2)(A) the 90-day period beginning on the date on
which the copy of the final legal text of the agreement
is submitted under paragraph (1) to the congressional
committees and staff has expired; and
(B) if the President has vetoed a joint resolution
described in subsection (d)(2) relating to the
agreement, the 15-day period described in subsection
(d)(1)(B)(ii) has expired.
(d) Congressional Review.--
(1) Disapproval.--
(A) In general.--A covered agreement shall
have no force and effect in the United States
if, before the expiration of the 90-day period
beginning on the day that the final legal text
of the agreement is submitted to the Congress
pursuant to subsection (c), a joint resolution
described in paragraph (2) is enacted into law.
(B) Veto.--If the President vetoes the joint
resolution, the joint resolution shall be
treated as enacted into law before the end of
the 90-day period under subparagraph (A) if
both Houses of Congress vote to override such
veto on or before the later of--
(i) the last day of such 90-day
period; or
(ii) the last day of the 15-day
period (excluding any day described in
paragraph (8)) beginning on the date
the Congress receives the veto message
from the President.
(2) Contents of resolutions.--For purposes of this
subsection, the term ``resolution'' means only a joint
resolution of the two Houses of the Congress, that is
introduced during the 60-day period beginning upon the
submission to the Congress pursuant to subsection (c)
of the covered agreement to which such resolution
relates, and the matter after the resolving clause of
which is as follows: ``That the Congress does not
approve the covered agreement transmitted to the
Congress pursuant to section 314(c) of title 31, United
States Code, on ______.'', the blank space being filled
with the appropriate date.
(3) Reference to committees.--All resolutions
introduced in the House of Representatives shall be
referred to the Committee on Financial Services and all
resolutions introduced in the Senate shall be referred
to the Committee on Banking, Housing, and Urban
Affairs.
(4) Discharge of committees.--
(A) In general.--If the committee of either
House to which a resolution has been referred
has not reported it at the end of 30 days after
its introduction, not counting any day which is
excluded under paragraph (8), it is in order to
move either to discharge the committee from
further consideration of the resolution or to
discharge the committee from further
consideration of any other resolution
introduced with respect to the same matter,
except that a motion to discharge--
(i) may only be made on the second
legislative day after the calendar day
on which the Member making the motion
announces to the House his intention to
do so; and
(ii) is not in order after the
committee has reported a resolution
with respect to the same matter.
(B) Privilege.--A motion to discharge under
subparagraph (A) may be made only by an
individual favoring the resolution, and is
highly privileged in the House and privileged
in the Senate; and debate thereon shall be
limited to not more than 1 hour, the time to be
divided in the House equally between those
favoring and those opposing the resolution, and
to be divided in the Senate equally between,
and controlled by, the majority leader and the
minority leader or their designees. An
amendment to the motion is not in order, and it
is not in order to move to reconsider the vote
by which the motion is agreed to or disagreed
to.
(5) Floor consideration in the house.--
(A) In general.--A motion in the House of
Representatives to proceed to the consideration
of a resolution shall be highly privileged and
not debatable. An amendment to the motion shall
not be in order, nor shall it be in order to
move to reconsider the vote by which the motion
is agreed to or disagreed to.
(B) Debate; no reconsideration.--Debate in
the House of Representatives on a resolution
shall be limited to not more than 20 hours,
which shall be divided equally between those
favoring and those opposing the resolution. A
motion further to limit debate shall not be
debatable. No amendment to, or motion to
recommit, the resolution shall be in order. It
shall not be in order to move to reconsider the
vote by which a resolution is agreed to or
disagreed to.
(C) Consideration of other motions.--Motions
to postpone, made in the House of
Representatives with respect to the
consideration of a resolution, and motions to
proceed to the consideration of other business,
shall be decided without debate.
(D) Appeals to decisions of chair.--All
appeals from the decisions of the Chair
relating to the application of the Rules of the
House of Representatives to the procedure
relating to a resolution shall be decided
without debate.
(E) Applicability of rules.--Except to the
extent specifically provided in the preceding
provisions of this paragraph, consideration of
a resolution in the House of Representatives
shall be governed by the Rules of the House of
Representatives applicable to other resolutions
in similar circumstances.
(6) Floor consideration in the senate.--
(A) Motion to proceed.--A motion in the
Senate to proceed to the consideration of a
resolution shall be privileged. An amendment to
the motion shall not be in order, nor shall it
be in order to move to reconsider the vote by
which the motion is agreed to or disagreed to.
(B) Debate on resolution.--Debate in the
Senate on a resolution, and all debatable
motions and appeals in connection therewith,
shall be limited to not more than 20 hours, to
be equally divided between, and controlled by,
the majority leader and the minority leader or
their designees.
(C) Debate on motion or appeal.--Debate in
the Senate on any debatable motion or appeal in
connection with a resolution shall be limited
to not more than 1 hour, to be equally divided
between, and controlled by, the mover and the
manager of the resolution, except that in the
event the manager of the resolution is in favor
of any such motion or appeal, the time in
opposition thereto, shall be controlled by the
minority leader or his designee. Such leaders,
or either of them, may, from time under their
control on the passage of a resolution, allot
additional time to any Senator during the
consideration of any debatable motion or
appeal.
(D) Motion to limit debate.--A motion in the
Senate to further limit debate on a resolution,
debatable motion, or appeal is not debatable.
No amendment to, or motion to recommit, a
resolution is in order in the Senate.
(7) Procedures in the senate.--
(A) Procedures.--Except as otherwise provided
in this section, the following procedures shall
apply in the Senate to a resolution to which
this subsection applies:
(i)(I) Except as provided in
subclause (II), a resolution that has
passed the House of Representatives
shall, when received in the Senate, be
referred to the Committee on Banking,
Housing, and Urban Affairs for
consideration in accordance with this
subsection.
(II) If a resolution to which this
subsection applies was introduced in
the Senate before receipt of a
resolution that has passed the House of
Representatives, the resolution from
the House of Representatives shall,
when received in the Senate, be placed
on the calendar. If this subclause
applies, the procedures in the Senate
with respect to a resolution introduced
in the Senate that contains the
identical matter as the resolution that
passed the House of Representatives
shall be the same as if no resolution
had been received from the House of
Representatives, except that the vote
on passage in the Senate shall be on
the resolution that passed the House of
Representatives.
(ii) If the Senate passes a
resolution before receiving from the
House of Representatives a joint
resolution that contains the identical
matter, the joint resolution shall be
held at the desk pending receipt of the
joint resolution from the House of
Representatives. Upon receipt of the
joint resolution from the House of
Representatives, such joint resolution
shall be deemed to be read twice,
considered, read the third time, and
passed.
(B) Non-identical resolutions.--If the texts
of joint resolutions described in this
subsection concerning any matter are not
identical--
(i) the Senate shall vote passage on
the resolution introduced in the
Senate; and
(ii) the text of the joint resolution
passed by the Senate shall, immediately
upon its passage (or, if later, upon
receipt of the joint resolution passed
by the House), be substituted for the
text of the joint resolution passed by
the House of Representatives, and such
resolution, as amended, shall be
returned with a request for a
conference between the two Houses.
(C) Consideration of veto message.--
Consideration in the Senate of any veto message
with respect to a joint resolution described in
paragraph (2), including consideration of all
debatable motions and appeals in connection
therewith, shall be limited to 10 hours, to be
equally divided between, and controlled by, the
majority leader and the minority leader or
their designees.
(8) Computation of period.--For purposes of paragraph
(1)(A) of this subsection and paragraph (2)(A) of
subsection (c), the 90-day period referred to in such
paragraph shall be computed by excluding--
(A) the days on which either House is not in
session because of an adjournment of more than
3 days to a day certain or an adjournment of
the Congress sine die; and
(B) any Saturday and Sunday, not excluded
under subparagraph (A), when either House is
not in session.
(9) Exercise of rulemaking power.--This subsection is
enacted by the Congress--
(A) as an exercise of the rulemaking power of
the House of Representatives and the Senate,
respectively, and as such they are deemed a
part of the rules of each House, respectively,
but applicable only with respect to the
procedure to be followed in that House in the
case of resolutions described in paragraph (2);
and they supersede other rules only to the
extent that they are inconsistent therewith;
and
(B) with full recognition of the
constitutional right of either House to change
the rules (so far as relating to the procedure
of that House) at any time, in the same manner
and to the same extent as in the case of any
other rule of that House.
(e) Requirements for Consultations.--Throughout the
negotiations of a covered agreement, parties representing the
Federal Government shall closely consult and coordinate with,
and include in such meetings, State insurance commissioners or,
at the option of the State insurance commissioners, designees
of the insurance commissioners acting at their direction.
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