Electronic Filings

AGENCY:

Office of the Comptroller of the Currency, Treasury.

ACTION:

Interim rule with request for comments.

SUMMARY:

The Office of the Comptroller of the Currency (OCC) is issuing this interim rule, with a request for comments, to amend our rules, policies and procedures for corporate activities. The interim rule expressly provides that the OCC may permit national banks to make any class of licensing filings electronically. Its purpose is to facilitate the expansion of the OCC's e-Corp program. The e-Corp program, which began as a pilot project to enable participating national banks to make certain types of licensing filings electronically, has been made available to all national banks through the OCC's National BankNet web site. The rule furthers the OCC's objectives of reducing regulatory burden for national banks and improving the agency's efficiency in processing filings through increased use of electronic technology. The interim rule also amends part 5 to clarify the circumstances under which we may adopt filing procedures different from those otherwise required by part 5.

DATES:

Effective Date: This rule is effective April 14, 2003.

Comment Date: Comments must be received by June 13, 2003.

ADDRESSES:

You should direct comments to the Public Information Room, Office of the Comptroller of the Currency, Mailstop 1-5, Attention: Docket No. 03-06, 250 E Street, SW., Washington, DC 20219. Due to delays in paper mail delivery in the Washington, DC, area, commenters are encouraged to submit comments by fax or e-mail. Comments may be sent by fax to (202) 874-4448, or by e-mail to regs.comments@occ.treas.gov. You can inspect and photocopy the comments at the OCC's Public Information Room, 250 E Street, SW., Washington, DC 20219. You can make an appointment to inspect the comments by calling (202) 874-5043.

FOR FURTHER INFORMATION CONTACT:

Jean Campbell, Attorney, Legislative and Regulatory Activities Division, (202) 874-5090; or Darrell Sheets, Licensing Data Manager, Licensing, Policy and Systems Division, (202) 874-5060, Office of the Comptroller of the Currency, 250 E Street, SW., Washington, DC 20219.

SUPPLEMENTARY INFORMATION:

Background and Description of the Rule

1. Electronic Filing

The OCC's ongoing objectives include minimizing regulatory burden for the national banks we supervise, consistent with safety and soundness, and achieving greater efficiency in the agency's regulatory processes. National banks' preparation of required licensing applications and filings and the OCC's processing of those submissions are activities where substantial efficiencies, including cost savings, can be achieved through increased use of electronic technology. Moreover, the Government Paperwork Elimination Act (GPEA) requires that Federal agencies consider providing the public with the option of automated transactional processes that use and accept electronic filings and signatures, when practicable. The requirements of GPEA apply to all interactions with the Federal government that involve the electronic submission, maintenance, or disclosure of information. This includes transactions “ such as the electronic filings that are the subject of this notice—that involve Federal information collections covered by the Paperwork Reduction Act (PRA).

To further the objectives we have described and to facilitate compliance with GPEA, the OCC designed Web-based corporate applications and made them available to a limited number of national banks through a pilot program called e-Corp. National banks that participated in the pilot used e-Corp to submit electronically certain licensing filings to the OCC using electronic signatures. Ten national banks participated in the pilot program. Authorized users from those national banks accessed e-Corp's electronic forms through the OCC's National BankNet Web site (BankNet). Four applications were available: establishment of a branch, relocation of a branch, relocation of a main office within a 30-mile radius (within current city, town or village limits), and relocation of a main office within a 30-mile radius (outside current city, town or village limits). Three more e-Corp electronic filings are currently under development: notices of branch closing, change of corporate title, and change of address.

In March 2003 the OCC made e-Corp available to all national banks through BankNet. The four corporate filings described above are available for electronic submission. In the near future we also expect to add to e-Corp additional classes of corporate filings, such as the three currently under development, as we gain experience with electronic filing. In recognition of the fact that national banks rely on technology to varying extents, electronic filing will be voluntary. Any bank that wishes to continue filing paper-based applications may do so.

The interim rule facilitates the expansion of e-Corp by revising § 5.2, which generally describes our filing rules. As revised, § 5.2 expressly provides that the OCC may permit national banks to make any class of filings available for electronic submission. The rule refers national banks to the Comptroller's Licensing Manual (Manual) to find information about the filings that are available for electronic submission. The Manual also specifies the procedures that apply to national banks making electronic filings. In light of rapid changes in technology and our plan to expand the electronic filing system over time, we believe it is preferable to provide detailed information on electronic filings in the more flexible format of the Manual, rather than in the text of the regulation. The Manual is available on the OCC's Internet website. The Manual is updated on a continuous basis and will be updated as necessary when electronic filing of additional types of applications or notices is available to national banks. We plan to publish notices on BankNet and the OCC's homepage whenever an additional class of applications is added to e-Corp.

2. Exceptions to Licensing Procedures

Section 5.2(b) of our rules provides that, after giving appropriate notice to the applicant and, at the OCC's discretion, to others, the OCC may adopt materially different procedures for a particular filing, or a class of filings, in exceptional circumstances, such as natural disasters or unusual transactions. The wording of this provision could be misleading if the reference to natural disasters were interpreted, contrary to its intended meaning, as establishing the standard for determining what is an exceptional circumstance rather than as merely illustrative of one type of situation where use of filing procedures otherwise prescribed by part 5 is warranted. Accordingly, the interim rule deletes the phrase “such as natural disasters.” As revised, the standard in § 5.2(b) simply permits the OCC to adopt materially different procedures in exceptional circumstances or for unusual transactions. The notice requirement in the current rule is unchanged.

3. Comptroller's Licensing Manual

The Comptroller's Corporate Manual formerly contained guidance on how applicants and other filers could comply with our rules. On July 17, 2002, the OCC replaced the Comptroller's Corporate Manual with the Comptroller's Licensing Manual and made the Manual available on our homepage. As we have described, the Manual contains information on corporate applications, such as charter and merger applications, and other policies and procedures on corporate changes sought by national banks. The interim rule substitutes the new name of the Manual, provides the OCC's Internet address, and substitutes a new address to use to submit a request for a printed version of the Manual.

4. Notice and Comment; Effective Date

Under the Administrative Procedure Act (APA), the requirement that an agency provide public notice and an opportunity for comment does not apply to “rules of agency organization, procedure, or practice.” This exemption applies to a rule that does not itself affect the substantive rights of those affected, even though the rule “may alter the manner in which the parties present themselves or their viewpoints to the agency.” JEM Broadcasting Co., Inc. v. FCC, 22 F.3d 320, 326-27 (D.C. Cir. 1994).

The interim rule has no effect on the substantive rights of national banks subject to application or filing requirements. The electronic filing amendments pertain only to the form in which a bank may make a submission to the OCC. Moreover, electronic filing is permissive, not mandatory. Similarly, the amendment to the “exceptional circumstances” provision only clarifies the types of circumstances that may warrant the use of special procedures. The requirement that the OCC provide notice to an applicant in such a case is unchanged. For these reasons, we conclude that this interim rule is not subject to the notice and comment requirements of the APA.

The interim rule is effective immediately upon publication in the Federal Register. An agency may dispense with the delayed effective date requirement of the APA for “good cause.” As we have described, we expect that the interim rule, which imposes no new requirements, will help produce efficiencies for national banks by enabling them to save time and money in the preparation and processing of certain required filings. For these reasons, we conclude that there is good cause to dispense with the 30-day delayed effective date prescribed by the APA.

Finally, subject to certain exceptions, 12 U.S.C. 4802(b)(1) provides that new regulations and amendments to regulations prescribed by a Federal banking agency that impose additional reporting, disclosure, or other new requirements on an insured depository institution must take effect on the first day of a calendar quarter that begins on or after the date on which the regulations are published in final form. The interim rule imposes no additional reporting, disclosure, or other new requirements on insured depository institutions. For this reason, section 4802(b)(1) does not apply to this rulemaking.

Comment Solicitation

Although notice and comment are not required, we are nonetheless interested in receiving any comments that may improve this rule before it is adopted in final form. We therefore request comment on all aspects of this interim rule.

Community Bank Comment Request

In addition, we invite your comments on the impact of this proposal on community banks. The OCC recognizes that community banks operate with more limited resources than larger institutions and may present a different risk profile. Thus, the OCC specifically requests comments on the impact of this proposal on community banks' current resources and available personnel with the requisite expertise, and whether the goals of the proposed regulation could be achieved, for community banks, through an alternative approach.

Solicitation of Comments on Use of Plain Language

The OCC also requests comment on whether the interim rule is written clearly and is easy to understand. On June 1, 1998, the President issued a memorandum directing each agency in the Executive branch to write its rules in plain language. This directive applies to all new proposed and final rulemaking documents issued on or after January 1, 1999. In addition, Pub. L. 106-102 requires each Federal agency to use plain language in all proposed and final rules published after January 1, 2000. The OCC invites comments on how to make this rule clearer. For example, you may wish to discuss:

(1) Whether we have organized the material to suit your needs;

(2) Whether the requirements of the rule are clear; or

(3) Whether there is something else we could do to make the rule easier to understand.

Regulatory Analysis

Regulatory Flexibility Act

The Regulatory Flexibility Act applies only to rules for which an agency publishes a general notice of proposed rulemaking pursuant to 5 U.S.C. 553(b). Because the OCC has determined for good cause that the APA does not require public notice and comment on this final rule, we are not publishing a general notice of proposed rulemaking. Thus, the Regulatory Flexibility Act does not apply to this interim rule.

Unfunded Mandates Reform Act of 1995

Section 202 of the Unfunded Mandates Reform Act of 1995, Pub. L. 104-04 (Unfunded Mandates Act) requires that an agency prepare a budgetary impact statement before promulgating a rule that includes a Federal mandate that may result in expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any one year. If a budgetary impact statement is required, section 205 of the Unfunded Mandates Act also requires an agency to identify and consider a reasonable number of regulatory alternatives before promulgating a rule. The OCC has determined that the interim rule will not result in expenditures by State, local, or tribal governments or by the private sector of $100 million or more. Accordingly, the OCC has not prepared a budgetary impact statement or specifically addressed the regulatory alternatives considered.

Executive Order 12866

The OCC has determined that this rule does not constitute a “significant regulatory action” for the purposes of Executive Order 12866.

List of Subjects in Part 5

• Administrative practice and procedure
• National banks
• Reporting and recordkeeping requirements
• Securities

Authority and Issuance

For the reasons set forth in the preamble, part 5 of chapter I of the Code of Federal Regulations is revised to read as follows:

PART 5—RULES, POLICIES, AND PROCEDURES FOR CORPORATE ACTIVITIES

1. The authority citation for part 5 continues to read as follows:

Authority: 12 U.S.C. 1 et seq., 24a, 24(Seventh), 93a, and 3101 et seq.

2. In § 5.2, paragraphs (b) and (c) are revised and a new paragraph (d) is added to read as follows: