[Congressional Bills 103th Congress]
[From the U.S. Government Printing Office]
[S. 422 Enrolled Bill (ENR)]
S.422
One Hundred Third Congress
of the
United States of America
AT THE FIRST SESSION
Begun and held at the City of Washington on Tuesday,
the fifth day of January, one thousand nine hundred and ninety-three
An Act
To extend and revise rulemaking authority with respect to government
securities
under the Federal securities laws, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,

3941d611d89e89f5d859b0e2282a860a9475164eacc215baaa4b9e6846719882

(a) Short Title.--This Act may be cited as the ``Government
Securities Act Amendments of 1993''.
(b) Table of Contents.--The table of contents for this Act is as
follows:

e34fc9cb090646eb8898489a8419a7396642146fdb3f6bc558f89d90c84a57be

1fe5c0ecb94c49fa88fe70cf0c233959e213c6d35ef6d35e480edab699099df1

TITLE I

-AMENDMENTS TO THE SECURITIES EXCHANGE ACT OF 1934

securities dealers whose accounts are not insured by the
Securities Investor Protection Corporation.

c56325ce056dbd0aab82c130681c20bab247e0a5463412fb684e55837f7a389b

eb774be7f0db4dabd774b08cc88c14e05043c79d1cf2ca8c9167e9e428010715

TITLE III

-LIMITED PARTNERSHIP ROLLUPS

The Congress finds that--
(1) the liquid and efficient operation of the government
securities market is essential to facilitate government borrowing at
the lowest possible cost to taxpayers;
(2) the fair and honest treatment of investors will strengthen
the integrity and liquidity of the government securities market;
(3) rules promulgated by the Secretary of the Treasury pursuant
to the Government Securities Act of 1986 have worked well to protect
investors from unregulated dealers and maintain the efficiency of
the government securities market; and
(4) extending the authority of the Secretary and providing new
authority will ensure the continued strength of the government
securities market.

bcae3cb009798ac22c50610b39608fdb5f663da469dac4648fe4bf6c8ce40222

Section 15C of the Securities Exchange Act of 1934 (15 U.S.C. 78o-5)
is amended by striking subsection (g).

a3d39cb1fcfc970c1fb95b2c7438b1df20db951ca3a8ce49bf873da57f4ee01a

(a) Amendment.--Section 15C(d) of the Securities Exchange Act of
1934 (15 U.S.C. 78o-5(d)) is amended by adding at the end the following
new paragraph:
``(3) Government Securities Trade Reconstruction.--
``(A) Furnishing records.--Every government securities broker
and government securities dealer shall furnish to the Commission on
request such records of government securities transactions,
including records of the date and time of execution of trades, as
the Commission may require to reconstruct trading in the course of a
particular inquiry or investigation being conducted by the
Commission for enforcement or surveillance purposes. In requiring
information pursuant to this paragraph, the Commission shall specify
the information required, the period for which it is required, the
time and date on which the information must be furnished, and
whether the information is to be furnished directly to the
Commission, to the Federal Reserve Bank of New York, or to an
appropriate regulatory agency or self-regulatory organization with
responsibility for examining the government securities broker or
government securities dealer. The Commission may require that such
information be furnished in machine readable form notwithstanding
any limitation in subparagraph (B). In utilizing its authority to
require information in machine readable form, the Commission shall
minimize the burden such requirement may place on small government
securities brokers and dealers.
``(B) Limitation; construction.--The Commission shall not
utilize its authority under this paragraph to develop regular
reporting requirements, except that the Commission may require
information to be furnished under this paragraph as frequently as
necessary for particular inquiries or investigations for enforcement
or surveillance purposes. This paragraph shall not be construed as
requiring, or as authorizing the Commission to require, any
government securities broker or government securities dealer to
obtain or maintain any information for purposes of this paragraph
which is not otherwise maintained by such broker or dealer in
accordance with any other provision of law or usual and customary
business practice. The Commission shall, where feasible, avoid
requiring any information to be furnished under this paragraph that
the Commission may obtain from the Federal Reserve Bank of New York.
``(C) Procedures for requiring information.--At the time the
Commission requests any information pursuant to subparagraph (A)
with respect to any government securities broker or government
securities dealer for which the Commission is not the appropriate
regulatory agency, the Commission shall notify the appropriate
regulatory agency for such government securities broker or
government securities dealer and, upon request, furnish to the
appropriate regulatory agency any information supplied to the
Commission.
``(D) Consultation.--Within 90 days after the date of enactment
of this paragraph, and annually thereafter, or upon the request of
any other appropriate regulatory agency, the Commission shall
consult with the other appropriate regulatory agencies to determine
the availability of records that may be required to be furnished
under this paragraph and, for those records available directly from
the other appropriate regulatory agencies, to develop a procedure
for furnishing such records expeditiously upon the Commission's
request.
``(E) Exclusion for examination reports.--Nothing in this
paragraph shall be construed so as to permit the Commission to
require any government securities broker or government securities
dealer to obtain, maintain, or furnish any examination report of any
appropriate regulatory agency other than the Commission or any
supervisory recommendations or analysis contained in any such
examination report.
``(F) Authority to limit disclosure of information.--
Notwithstanding any other provision of law, the Commission and the
appropriate regulatory agencies shall not be compelled to disclose
any information required or obtained under this paragraph. Nothing
in this paragraph shall authorize the Commission or any appropriate
regulatory agency to withhold information from Congress, or prevent
the Commission or any appropriate regulatory agency from complying
with a request for information from any other Federal department or
agency requesting information for purposes within the scope of its
jurisdiction, or from complying with an order of a court of the
United States in an action brought by the United States, the
Commission, or the appropriate regulatory agency. For purposes of
section 552 of title 5, United States Code, this subparagraph shall
be considered a statute described in subsection (b)(3)(B) of such
section 552.''.
(b) Conforming Amendments.--(1) Section 15C(a)(4) of the Securities
Exchange Act of 1934 (15 U.S.C. 78o-5(a)(4)) is amended by inserting ``,
other than subsection (d)(3),'' after ``subsection (a), (b), or (d) of
this section''.
(2) Section 15C(f)(2) of such Act is amended--
(A) in the first sentence, by inserting ``, other than
subsection (d)(3)'', after ``threatened violation of the provisions
of this section''; and
(B) in the second sentence, by inserting ``(except subsection
(d)(3))'' after ``other than this section''.

4f1f609860ef98ea0d555f5a14fa576153f8d910a49e506d6411a6c18f914342

Section 15C of the Securities Exchange Act of 1934 (15 U.S.C. 78o-5)
is amended--
(1) by redesignating subsection (f) as subsection (g); and
(2) by inserting after subsection (e) the following new
subsection:
``(f) Large Position Reporting.--
``(1) Reporting requirements.--The Secretary may adopt rules to
require specified persons holding, maintaining, or controlling large
positions in to-be-issued or recently issued Treasury securities to
file such reports regarding such positions as the Secretary
determines to be necessary and appropriate for the purpose of
monitoring the impact in the Treasury securities market of
concentrations of positions in Treasury securities and for the
purpose of otherwise assisting the Commission in the enforcement of
this title, taking into account any impact of such rules on the
efficiency and liquidity of the Treasury securities market and the
cost to taxpayers of funding the Federal debt. Unless otherwise
specified by the Secretary, reports required under this subsection
shall be filed with the Federal Reserve Bank of New York, acting as
agent for the Secretary. Such reports shall, on a timely basis, be
provided directly to the Commission by the person with whom they are
filed.
``(2) Recordkeeping requirements.--Rules under this subsection
may require persons holding, maintaining, or controlling large
positions in Treasury securities to make and keep for prescribed
periods such records as the Secretary determines are necessary or
appropriate to ensure that such persons can comply with reporting
requirements under this subsection.
``(3) Aggregation rules.--Rules under this subsection--
``(A) may prescribe the manner in which positions and
accounts shall be aggregated for the purpose of this subsection,
including aggregation on the basis of common ownership or
control; and
``(B) may define which persons (individually or as a group)
hold, maintain, or control large positions.
``(4) Definitional authority; determination of reporting
threshold.--
``(A) In prescribing rules under this subsection, the
Secretary may, consistent with the purpose of this subsection,
define terms used in this subsection that are not otherwise
defined in section 3 of this title.
``(B) Rules under this subsection shall specify--
``(i) the minimum size of positions subject to reporting
under this subsection, which shall be no less than the size
that provides the potential for manipulation or control of
the supply or price, or the cost of financing arrangements,
of an issue or the portion thereof that is available for
trading;
``(ii) the types of positions (which may include
financing arrangements) to be reported;
``(iii) the securities to be covered; and
``(iv) the form and manner in which reports shall be
transmitted, which may include transmission in machine
readable form.
``(5) Exemptions.--Consistent with the public interest and the
protection of investors, the Secretary by rule or order may exempt
in whole or in part, conditionally or unconditionally, any person or
class or persons, or any transaction or class of transactions, from
the requirements of this subsection.
``(6) Limitation on disclosure of information.--Notwithstanding
any other provision of law, the Secretary and the Commission shall
not be compelled to disclose any information required to be kept or
reported under this subsection. Nothing in this subsection shall
authorize the Secretary or the Commission to withhold information
from Congress, or prevent the Secretary or the Commission from
complying with a request for information from any other Federal
department or agency requesting information for purposes within the
scope of its jurisdiction, or from complying with an order of a
court of the United States in an action brought by the United
States, the Secretary, or the Commission. For purposes of section
552 of title 5, United States Code, this paragraph shall be
considered a statute described in subsection (b)(3)(B) of such
section 552.''.

8f72d08853392d58488e23f8717f0f8daeef36e61ffd2667b24e885631dd40fc

EXEMPTED SECURITIES.
(a) Prevention of Fraudulent and Manipulative Acts and Practices.--
Section 15(c)(2) of the Securities Exchange Act of 1934 (15 U.S.C.
78o(c)(2)) is amended--
(1) by inserting ``(A)'' after ``(2)'';
(2) by striking ``fictitious quotation, and no municipal
securities dealer'' and inserting the following:
``fictitious quotation.
``(B) No municipal securities dealer'';
(3) by striking ``fictitious quotation. The Commission shall''
and inserting the following:
``fictitious quotation.
``(C) No government securities broker or government securities
dealer shall make use of the mails or any means or instrumentality of
interstate commerce to effect any transaction in, or induce or attempt
to induce the purchase or sale of, any government security in connection
with which such government securities broker or government securities
dealer engages in any fraudulent, deceptive, or manipulative act or
practice, or makes any fictitious quotation.
``(D) The Commission shall''; and
(4) by adding at the end the following:
``(E) The Commission shall, prior to adopting any rule or regulation
under subparagraph (C), consult with and consider the views of the
Secretary of the Treasury and each appropriate regulatory agency. If the
Secretary of the Treasury or any appropriate regulatory agency comments
in writing on a proposed rule or regulation of the Commission under such
subparagraph (C) that has been published for comment, the Commission
shall respond in writing to such written comment before adopting the
proposed rule. If the Secretary of the Treasury determines, and notifies
the Commission, that such rule or regulation, if implemented, would, or
as applied does (i) adversely affect the liquidity or efficiency of the
market for government securities; or (ii) impose any burden on
competition not necessary or appropriate in furtherance of the purposes
of this section, the Commission shall, prior to adopting the proposed
rule or regulation, find that such rule or regulation is necessary and
appropriate in furtherance of the purposes of this section
notwithstanding the Secretary's determination.''.
(b) Fraudulent and Manipulative Devices and Contrivances.--Section
15(c)(1) of the Securities Exchange Act of 1934 (15 U.S.C. 78o(c)(1)) is
amended--
(1) by inserting ``(A)'' after ``(c)(1)'';
(2) by striking ``contrivance, and no municipal securities
dealer'' and inserting the following:
``contrivance.
``(B) No municipal securities dealer'';
(3) by striking ``contrivance. The Commission shall'' and
inserting the following:
``contrivance.
``(C) No government securities broker or government securities
dealer shall make use of the mails or any means or instrumentality of
interstate commerce to effect any transaction in, or to induce or
attempt to induce the purchase or sale of, any government security by
means of any manipulative, deceptive, or other fraudulent device or
contrivance.
``(D) The Commission shall''; and
(4) by adding at the end the following:
``(E) The Commission shall, prior to adopting any rule or regulation
under subparagraph (C), consult with and consider the views of the
Secretary of the Treasury and each appropriate regulatory agency. If the
Secretary of the Treasury or any appropriate regulatory agency comments
in writing on a proposed rule or regulation of the Commission under such
subparagraph (C) that has been published for comment, the Commission
shall respond in writing to such written comment before adopting the
proposed rule. If the Secretary of the Treasury determines, and notifies
the Commission, that such rule or regulation, if implemented, would, or
as applied does (i) adversely affect the liquidity or efficiency of the
market for government securities; or (ii) impose any burden on
competition not necessary or appropriate in furtherance of the purposes
of this section, the Commission shall, prior to adopting the proposed
rule or regulation, find that such rule or regulation is necessary and
appropriate in furtherance of the purposes of this section
notwithstanding the Secretary's determination.''.

d2f2ff94cd47e949dff2778b576368c8a393d6a1976f29a7235e3742cb3001ae

(a) Rules for Financial Institutions.--Section 15C(b) of the
Securities Exchange Act of 1934 (15 U.S.C. 78o-5(b)) is amended--
(1) by redesignating paragraphs (3), (4), (5), and (6) as
paragraphs (4), (5), (6), and (7), respectively; and
(2) by inserting after paragraph (2) the following new
paragraph:
``(3)(A) With respect to any financial institution that has filed
notice as a government securities broker or government securities dealer
or that is required to file notice under subsection (a)(1)(B), the
appropriate regulatory agency for such government securities broker or
government securities dealer may issue such rules and regulations with
respect to transactions in government securities as may be necessary to
prevent fraudulent and manipulative acts and practices and to promote
just and equitable principles of trade. If the Secretary of the Treasury
determines, and notifies the appropriate regulatory agency, that such
rule or regulation, if implemented, would, or as applied does (i)
adversely affect the liquidity or efficiency of the market for
government securities; or (ii) impose any burden on competition not
necessary or appropriate in furtherance of the purposes of this section,
the appropriate regulatory agency shall, prior to adopting the proposed
rule or regulation, find that such rule or regulation is necessary and
appropriate in furtherance of the purposes of this section
notwithstanding the Secretary's determination.
``(B) The appropriate regulatory agency shall consult with and
consider the views of the Secretary prior to approving or amending a
rule or regulation under this paragraph, except where the appropriate
regulatory agency determines that an emergency exists requiring
expeditious and summary action and publishes its reasons therefor. If
the Secretary comments in writing to the appropriate regulatory agency
on a proposed rule or regulation that has been published for comment,
the appropriate regulatory agency shall respond in writing to such
written comment before approving the proposed rule or regulation.
``(C) In promulgating rules under this section, the appropriate
regulatory agency shall consider the sufficiency and appropriateness of
then existing laws and rules applicable to government securities
brokers, government securities dealers, and persons associated with
government securities brokers and government securities dealers.''.
(b) Rules by Registered Securities Associations.--
(1) Removal of limitations on authority.--(A) Section 15A of the
Securities Exchange Act of 1934 (15 U.S.C. 78o-3) is amended--
(i) by striking subsections (f)(1) and (f)(2); and
(ii) by redesignating subsection (f)(3) as subsection (f).
(B) Section 15A(g) of such Act is amended--
(i) by striking ``exempted securities'' in paragraph (3)(D)
and inserting ``municipal securities'';
(ii) by striking paragraph (4); and
(iii) by redesignating paragraph (5) as paragraph (4).
(2) Conforming amendment.--
(A) Section 3(a)(12)(B)(ii) of such Act (15 U.S.C.
78c(a)(12)(B)(ii)) is amended by striking ``15, 15A (other than
subsection (g)(3)), and 17A'' and inserting ``15 and 17A''.
(B) Section 15(b)(7) of such Act (15 U.S.C. 78o(b)(7)) is
amended by inserting ``or government securities broker or
government securities dealer registered (or required to
register) under section 15C(a)(1)(A)'' after ``No registered
broker or dealer''.
(c) Oversight of Registered Securities Associations.--Section 19 of
the Securities Exchange Act of 1934 (15 U.S.C. 78s) is amended--
(1) in subsection (b), by adding at the end the following new
paragraphs:
``(5) The Commission shall consult with and consider the views of
the Secretary of the Treasury prior to approving a proposed rule filed
by a registered securities association that primarily concerns conduct
related to transactions in government securities, except where the
Commission determines that an emergency exists requiring expeditious or
summary action and publishes its reasons therefor. If the Secretary of
the Treasury comments in writing to the Commission on a proposed rule
that has been published for comment, the Commission shall respond in
writing to such written comment before approving the proposed rule. If
the Secretary of the Treasury determines, and notifies the Commission,
that such rule, if implemented, would, or as applied does (i) adversely
affect the liquidity or efficiency of the market for government
securities; or (ii) impose any burden on competition not necessary or
appropriate in furtherance of the purposes of this section, the
Commission shall, prior to adopting the proposed rule, find that such
rule is necessary and appropriate in furtherance of the purposes of this
section notwithstanding the Secretary's determination.
``(6) In approving rules described in paragraph (5), the Commission
shall consider the sufficiency and appropriateness of then existing laws
and rules applicable to government securities brokers, government
securities dealers, and persons associated with government securities
brokers and government securities dealers.''; and
(2) in subsection (c), by adding at the end the following new
paragraph:
``(5) With respect to rules described in subsection (b)(5), the
Commission shall consult with and consider the views of the Secretary of
the Treasury before abrogating, adding to, and deleting from such rules,
except where the Commission determines that an emergency exists
requiring expeditious or summary action and publishes its reasons
therefor.''.

d7872662d098c00988fdfe458cbe730454c55f0c75c913285d0ce40933251756

Section 23(b)(4) of the Securities Exchange Act of 1934 (15 U.S.C.
78w) is amended--
(1) by striking subparagraphs (C), (D), and (H);
(2) by redesignating subparagraphs (E), (F), and (G) as
subparagraphs (C), (D), and (E), respectively;
(3) by redesignating subparagraphs (I), (J), and (K) as
subparagraphs (F), (G), and (H), respectively;
(4) by striking ``and'' at the end of such redesignated
subparagraph (G);
(5) by striking the period at the end of such redesignated
subparagraph (H) and inserting ``; and''; and
(6) by inserting after such redesignated subparagraph (H) the
following new subparagraph:
``(I) the steps that have been taken and the progress that has
been made in promoting the timely public dissemination and
availability for analytical purposes (on a fair, reasonable, and
nondiscriminatory basis) of information concerning government
securities transactions and quotations, and its recommendations, if
any, for legislation to assure timely dissemination of (i)
information on transactions in regularly traded government
securities sufficient to permit the determination of the prevailing
market price for such securities, and (ii) reports of the highest
published bids and lowest published offers for government securities
(including the size at which persons are willing to trade with
respect to such bids and offers).''.

c66aa90a6e0229e9d67bee56937caf44d8d6d4ec61fdd82846585f59fb8394ba

SECURITIES DEALERS WHOSE ACCOUNTS ARE NOT INSURED BY THE
SECURITIES INVESTOR PROTECTION CORPORATION.
Section 15C(a) of the Securities Exchange Act of 1934 (15 U.S.C.
78o-5(a)) is amended--
(1) by redesignating paragraph (4) as paragraph (5); and
(2) by inserting after paragraph (3) the following:
``(4) No government securities broker or government securities
dealer that is required to register under paragraph (1)(A) and that is
not a member of the Securities Investor Protection Corporation shall
effect any transaction in any security in contravention of such rules as
the Commission shall prescribe pursuant to this subsection to assure
that its customers receive complete, accurate, and timely disclosure of
the inapplicability of Securities Investor Protection Corporation
coverage to their accounts.''.

09437091c3330711d484ec1ff3547f3d96093bd258346a042306b03993be19f6

(a) Amendments to Definitions.--Section 3(a) of the Securities
Exchange Act of 1934 (15 U.S.C. 78c(a)) is amended--
(1) in paragraph (34)(G) (relating to the definition of
appropriate regulatory agency), by amending clauses (ii), (iii), and
(iv) to read as follows:
``(ii) the Board of Governors of the Federal Reserve
System, in the case of a State member bank of the Federal
Reserve System, a foreign bank, an uninsured State branch or
State agency of a foreign bank, a commercial lending company
owned or controlled by a foreign bank (as such terms are
used in the International Banking Act of 1978), or a
corporation organized or having an agreement with the Board
of Governors of the Federal Reserve System pursuant to
section 25 or section 25A of the Federal Reserve Act;
``(iii) the Federal Deposit Insurance Corporation, in
the case of a bank insured by the Federal Deposit Insurance
Corporation (other than a member of the Federal Reserve
System or a Federal savings bank) or an insured State branch
of a foreign bank (as such terms are used in the
International Banking Act of 1978);
``(iv) the Director of the Office of Thrift Supervision,
in the case of a savings association (as defined in section
3(b) of the Federal Deposit Insurance Act) the deposits of
which are insured by the Federal Deposit Insurance
Corporation;'';
(2) by amending paragraph (46) (relating to the definition of
financial institution) to read as follows:
``(46) The term `financial institution' means--
``(A) a bank (as defined in paragraph (6) of this
subsection);
``(B) a foreign bank (as such term is used in the
International Banking Act of 1978); and
``(C) a savings association (as defined in section 3(b) of
the Federal Deposit Insurance Act) the deposits of which are
insured by the Federal Deposit Insurance Corporation.''; and
(3) by redesignating paragraph (51) (as added by section 204 of
the International Securities Enforcement Cooperation Act of 1990) as
paragraph (52).
(b) Effective Date of Broker/Dealer Registration.--
(1) Government securities brokers and dealers.--Section
15C(a)(2)(ii) of the Securities Exchange Act of 1934 (15 U.S.C. 78o-
5(a)(2)(ii)) is amended by inserting before ``The Commission may
extend'' the following: ``The order granting registration shall not
be effective until such government securities broker or government
securities dealer has become a member of a national securities
exchange registered under section 6 of this title, or a securities
association registered under section 15A of this title, unless the
Commission has exempted such government securities broker or
government securities dealer, by rule or order, from such
membership.''.
(2) Other brokers and dealers.--Section 15(b)(1)(B) of such Act
(15 U.S.C. 78o(b)(1)(B)) is amended by inserting before ``The
Commission may extend'' the following: ``The order granting
registration shall not be effective until such broker or dealer has
become a member of a registered securities association, or until
such broker or dealer has become a member of a national securities
exchange if such broker or dealer effects transactions solely on
that exchange, unless the Commission has exempted such broker or
dealer, by rule or order, from such membership.''.
(c) Information Sharing.--Section 15C(d)(2) of such Act is amended
to read as follows:
``(2) Information received by an appropriate regulatory agency, the
Secretary, or the Commission from or with respect to any government
securities broker, government securities dealer, any person associated
with a government securities broker or government securities dealer, or
any other person subject to this section or rules promulgated
thereunder, may be made available by the Secretary or the recipient
agency to the Commission, the Secretary, the Department of Justice, the
Commodity Futures Trading Commission, any appropriate regulatory agency,
any self-regulatory organization, or any Federal Reserve Bank.''.

4428b7a6cd8e5604aef6a136286acea6f53adc9d17dfd528495ed520cf13cd95

Section 15(c) of the Securities Exchange Act of 1934 (15 U.S.C.
78o(c)) is amended by adding at the end the following new paragraph:
``(7) In connection with any bid for or purchase of a government
security related to an offering of government securities by or on behalf
of an issuer, no government securities broker, government securities
dealer, or bidder for or purchaser of securities in such offering shall
knowingly or willfully make any false or misleading written statement or
omit any fact necessary to make any written statement made not
misleading.''.

f797840db5423e60a4703c97acc18a81bebbfc37caded6c95de28419dbcfe0ee

(a) In General.--No provision of, or amendment made by, this title
may be construed--
(1) to govern the initial issuance of any public debt
obligation, or
(2) to grant any authority to (or extend any authority of) the
Securities and Exchange Commission, any appropriate regulatory
agency, or a self-regulatory organization--
(A) to prescribe any procedure, term, or condition of such
initial issuance,
(B) to promulgate any rule or regulation governing such
initial issuance, or
(C) to otherwise regulate in any manner such initial
issuance.
(b) Exception.--Subsection (a) of this section shall not apply to
the amendment made by section 110 of this Act.
(c) Public Debt Obligation.--For purposes of this section, the term
``public debt obligation'' means an obligation subject to the public
debt limit established in section 3101 of title 31, United States Code.

f2a2a0b7fc1b6f289a64446213156e76ada7dfad86dcc4c25c5239fb8e969b20

(a) Joint Study.--The Secretary of the Treasury, the Securities and
Exchange Commission, and the Board of Governors of the Federal Reserve
System shall--
(1) with respect to any rules promulgated or amended after
October 1, 1991, pursuant to section 15C of the Securities Exchange
Act of 1934 or any amendment made by this title, and any national
securities association rule changes applicable principally to
government securities transactions approved after October 1, 1991--
(A) evaluate the effectiveness of such rules in carrying out
the purposes of such Act; and
(B) evaluate the impact of any such rules on the efficiency
and liquidity of the government securities market and the cost
of funding the Federal debt;
(2) evaluate the effectiveness of surveillance and enforcement
with respect to government securities, and the impact on such
surveillance and enforcement of the availability of automated, time-
sequenced records of essential information pertaining to trades in
such securities; and
(3) submit to the Congress, not later than March 31, 1998, any
recommendations they may consider appropriate concerning--
(A) the regulation of government securities brokers and
government securities dealers;
(B) the dissemination of information concerning quotations
for and transactions in government securities;
(C) the prevention of sales practice abuses in connection
with transactions in government securities; and
(D) such other matters as they consider appropriate.
(b) Treasury Study.--The Secretary of the Treasury, in consultation
with the Securities and Exchange Commission, shall--
(1) conduct a study of--
(A) the identity and nature of the business of government
securities brokers and government securities dealers that are
registered with the Securities and Exchange Commission under
section 15C of the Securities Exchange Act of 1934; and
(B) the continuing need for, and regulatory and financial
consequences of, a separate regulatory system for such
government securities brokers and government securities dealers;
and
(2) submit to the Congress, not later than 18 months after the
date of enactment of this Act, the Secretary's recommendations for
change, if any, or such other recommendations as the Secretary
considers appropriate.

c507de1f4eb5c421b74cff621f49a5e38a07eba86c052ff43fc246e592fb7f56

(a) General Rule.--Subchapter II of chapter 31 of title 31, United
States Code, is amended by adding at the end the following new section:
``§3130. Annual public debt report
``(a) General Rule.--On or before June 1 of each calendar year after
1993, the Secretary of the Treasury shall submit a report to the
Committee on Ways and Means of the House of Representatives and the
Committee on Finance of the Senate on--
``(1) the Treasury's public debt activities, and
``(2) the operations of the Federal Financing Bank.
``(b) Required Information on Public Debt Activities.--Each report
submitted under subsection (a) shall include the following information:
``(1) A table showing the following information with respect to
the total public debt:
``(A) The past levels of such debt and the projected levels
of such debt as of the close of the current fiscal year and as
of the close of the next 5 fiscal years under the most recent
current services baseline projection of the executive branch.
``(B) The past debt to GDP ratios and the projected debt to
GDP ratios as of the close of the current fiscal year and as of
the close of the next 5 fiscal years under such most recent
current services baseline projection.
``(2) A table showing the following information with respect to
the net public debt:
``(A) The past levels of such debt and the projected levels
of such debt as of the close of the current fiscal year and as
of the close of the next 5 fiscal years under the most recent
current services baseline projection of the executive branch.
``(B) The past debt to GDP ratios and the projected debt to
GDP ratios as of the close of the current fiscal year and as of
the close of the next 5 fiscal years under such most recent
current services baseline projection.
``(C) The interest cost on such debt for prior fiscal years
and the projected interest cost on such debt for the current
fiscal year and for the next 5 fiscal years under such most
recent current services baseline projection.
``(D) The interest cost to outlay ratios for prior fiscal
years and the projected interest cost to outlay ratios for the
current fiscal year and for the next 5 fiscal years under such
most recent current services baseline projection.
``(3) A table showing the maturity distribution of the net
public debt as of the time the report is submitted and for prior
years, and an explanation of the overall financing strategy used in
determining the distribution of maturities when issuing public debt
obligations, including a discussion of the projections and
assumptions with respect to the structure of interest rates for the
current fiscal year and for the succeeding 5 fiscal years.
``(4) A table showing the following information as of the time
the report is submitted and for prior years:
``(A) A description of the various categories of the holders
of public debt obligations.
``(B) The portions of the total public debt held by each of
such categories.
``(5) A table showing the relationship of federally assisted
borrowing to total Federal borrowing as of the time the report is
submitted and for prior years.
``(6) A table showing the annual principal and interest payments
which would be required to amortize in equal annual payments the
level (as of the time the report is submitted) of the net public
debt over the longest remaining term to maturity of any obligation
which is a part of such debt.
``(c) Required Information on Federal Financing Bank.--Each report
submitted under subsection (a) shall include (but not be limited to)
information on the financial operations of the Federal Financing Bank,
including loan payments and prepayments, and on the levels and
categories of the lending activities of the Federal Financing Bank, for
the current fiscal year and for prior fiscal years.
``(d) Recommendations.--The Secretary of the Treasury may include in
any report submitted under subsection (a) such recommendations to
improve the issuance and sale of public debt obligations (and with
respect to other matters) as he may deem advisable.
``(e) Definitions.--For purposes of this section--
``(1) Current fiscal year.--The term `current fiscal year' means
the fiscal year ending in the calendar year in which the report is
submitted.
``(2) Total public debt.--The term `total public debt' means the
total amount of the obligations subject to the public debt limit
established in section 3101 of this title.
``(3) Net public debt.--The term `net public debt' means the
portion of the total public debt which is held by the public.
``(4) Debt to gdp ratio.--The term `debt to GDP ratio' means the
percentage obtained by dividing the level of the total public debt
or net public debt, as the case may be, by the gross domestic
product.
``(5) Interest cost to outlay ratio.--The term `interest cost to
outlay ratio' means, with respect to any fiscal year, the percentage
obtained by dividing the interest cost for such fiscal year on the
net public debt by the total amount of Federal outlays for such
fiscal year.''.
(b) Clerical Amendment.--The analysis for subchapter II of chapter
31 of title 31, United States Code, is amended by adding at the end the
following new item:
``3130. Annual public debt report.''.

ca6329ae0b67eaf06240d6064e2e63186d5f3965f46d0727895f7eb71226d1f0

TITLE II

-REPORTS ON PUBLIC DEBT

(a) Ability to Submit Computer Tenders in Treasury Auctions.--By the
end of 1995, any bidder shall be permitted to submit a computer-
generated tender to any automated auction system established by the
Secretary of the Treasury for the sale upon issuance of securities
issued by the Secretary if the bidder--
(1) meets the minimum creditworthiness standard established by
the Secretary; and
(2) agrees to comply with regulations and procedures applicable
to the automated system and the sale upon issuance of securities
issued by the Secretary.
(b) Prohibition on Favored Players.--
(1) In general.--No government securities broker or government
securities dealer may receive any advantage, favorable treatment, or
other benefit, in connection with the purchase upon issuance of
securities issued by the Secretary of the Treasury, which is not
generally available to other government securities brokers or
government securities dealers under the regulations governing the
sale upon issuance of securities issued by the Secretary of the
Treasury.
(2) Exception.--
(A) In general.--The Secretary of the Treasury may grant an
exception to the application of paragraph (1) if--
(i) the Secretary determines that any advantage,
favorable treatment, or other benefit referred to in such
paragraph is necessary and appropriate and in the public
interest; and
(ii) the grant of the exception is designed to minimize
any anticompetitive effect.
(B) Annual report.--The Secretary of the Treasury shall
submit an annual report to the Congress describing any exception
granted by the Secretary under subparagraph (A) during the year
covered by the report and the basis upon which the exception was
granted.
(c) Meetings of Treasury Borrowing Advisory Committee.--
(1) Open meetings.--
(A) In general.--Except as provided in subparagraph (B), any
meeting of the Treasury Borrowing Advisory Committee of the
Public Securities Association (hereafter in this subsection
referred to as the ``advisory committee''), or any successor to
the advisory committee, shall be open to the public.
(B) Exception.--Subparagraph (A) shall not apply with
respect to any part of any meeting of the advisory committee in
which the advisory committee--
(i) discusses and debates the issues presented to the
advisory committee by the Secretary of the Treasury; or
(ii) makes recommendations to the Secretary.
(2) Minutes of each meeting.--The detailed minutes required to
be maintained under section 10(c) of the Federal Advisory Committee
Act for any meeting by the advisory committee shall be made
available to the public within 3 business days of the date of the
meeting.
(3) Prohibition on receipt of gratuities or expenses by any
officer or employee of the board or department.--In connection with
any meeting of the advisory committee, no officer or employee of the
Department of the Treasury, the Board of Governors of the Federal
Reserve System, or any Federal reserve bank may accept any gratuity,
consideration, expense of any sort, or any other thing of value from
any advisory committee described in subsection (c), any member of
such committee, or any other person.
(4) Prohibition on outside discussions.--
(A) In general.--Subject to subparagraph (B), a member of
the advisory committee may not discuss any part of any
discussion, debate, or recommendation at a meeting of the
advisory committee which occurs while such meeting is closed to
the public (in accordance with paragraph (1)(B)) with, or
disclose the contents of such discussion, debate, or
recommendation to, anyone other than--
(i) another member of the advisory committee who is
present at the meeting; or
(ii) an officer or employee of the Department of the
Treasury.
(B) Applicable period of prohibition.--The prohibition
contained in subparagraph (A) on discussions and disclosures of
any discussion, debate, or recommendation at a meeting of the
advisory committee shall cease to apply--
(i) with respect to any discussion, debate, or
recommendation which relates to the securities to be
auctioned in a midquarter refunding by the Secretary of the
Treasury, at the time the Secretary makes a public
announcement of the refunding; and
(ii) with respect to any other discussion, debate, or
recommendation at the meeting, at the time the Secretary
releases the minutes of the meeting in accordance with
paragraph (2).
(C) Removal from advisory committee for violations of this
paragraph.--In addition to any penalty or enforcement action to
which a person who violates a provision of this paragraph may be
subject under any other provision of law, the Secretary of the
Treasury shall--
(i) remove a member of the advisory committee who
violates a provision of this paragraph from the advisory
committee and permanently bar such person from serving as a
member of the advisory committee; and
(ii) prohibit any director, officer, or employee of the
firm of which the member referred to in clause (i) is a
director, officer, or employee (at the time the member is
removed from the advisory committee) from serving as a
member of the advisory committee at any time during the 5-
year period beginning on the date of such removal.
(d) Report to Congress.--
(1) Report required.--The Secretary of the Treasury shall submit
an annual report to the Congress containing the following
information with respect to material violations or suspected
material violations of regulations of the Secretary relating to
auctions and other offerings of securities upon the issuance of such
securities by the Secretary:
(A) The number of inquiries begun by the Secretary during
the year covered by the report regarding such material
violations or suspected material violations by any participant
in the auction system or any director, officer, or employee of
any such participant and the number of inquiries regarding any
such violations or suspected violations which remained open at
the end of such year.
(B) A brief description of the nature of the violations.
(C) A brief description of any action taken by the Secretary
during such year with respect to any such violation, including
any referrals made to the Attorney General, the Securities and
Exchange Commission, any other law enforcement agency, and any
Federal banking agency (as defined in section 3 of the Federal
Deposit Insurance Act).
(2) Delay in disclosure of information in certain cases.--The
Secretary of the Treasury shall not be required to include in a
report under paragraph (1) any information the disclosure of which
could jeopardize an investigation by an agency described in
paragraph (1)(C) for so long as such disclosure could jeopardize the
investigation.

615708464a975811aeb286fde71272128bf68efba913cdfe859fae3f2165b159

The Secretary of the Treasury shall notify the Congress of any
significant modifications to the auction process for issuing United
States Treasury obligations at the time such modifications are
implemented.

822cbc4e035f27026b1c597a03667735b4cee61c11293a9e41a48d1fbfad38e3

This title may be cited as the ``Limited Partnership Rollup Reform
Act of 1993''.

61e05d781eb3ef5097bbbf9558d0716ffb61f69c4f06e04c0cb38cb587709319

PARTNERSHIP ROLLUP TRANSACTIONS.
(a) Amendment.--Section 14 of the Securities Exchange Act of 1934
(15 U.S.C. 78n) is amended by adding at the end the following new
subsection:
``(h) Proxy Solicitations and Tender Offers in Connection With
Limited Partnership Rollup Transactions.--
``(1) Proxy rules to contain special provisions.--It shall be
unlawful for any person to solicit any proxy, consent, or
authorization concerning a limited partnership rollup transaction,
or to make any tender offer in furtherance of a limited partnership
rollup transaction, unless such transaction is conducted in
accordance with rules prescribed by the Commission under subsections
(a) and (d) as required by this subsection. Such rules shall--
``(A) permit any holder of a security that is the subject of
the proposed limited partnership rollup transaction to engage in
preliminary communications for the purpose of determining
whether to solicit proxies, consents, or authorizations in
opposition to the proposed limited partnership rollup
transaction, without regard to whether any such communication
would otherwise be considered a solicitation of proxies, and
without being required to file soliciting material with the
Commission prior to making that determination, except that--
``(i) nothing in this subparagraph shall be construed to
limit the application of any provision of this title
prohibiting, or reasonably designed to prevent, fraudulent,
deceptive, or manipulative acts or practices under this
title; and
``(ii) any holder of not less than 5 percent of the
outstanding securities that are the subject of the proposed
limited partnership rollup transaction who engages in the
business of buying and selling limited partnership interests
in the secondary market shall be required to disclose such
ownership interests and any potential conflicts of interests
in such preliminary communications;
``(B) require the issuer to provide to holders of the
securities that are the subject of the limited partnership
rollup transaction such list of the holders of the issuer's
securities as the Commission may determine in such form and
subject to such terms and conditions as the Commission may
specify;
``(C) prohibit compensating any person soliciting proxies,
consents, or authorizations directly from security holders
concerning such a limited partnership rollup transaction--
``(i) on the basis of whether the solicited proxy,
consent, or authorization either approves or disapproves the
proposed limited partnership rollup transaction; or
``(ii) contingent on the approval, disapproval, or
completion of the limited partnership rollup transaction;
``(D) set forth disclosure requirements for soliciting
material distributed in connection with a limited partnership
rollup transaction, including requirements for clear, concise,
and comprehensible disclosure with respect to--
``(i) any changes in the business plan, voting rights,
form of ownership interest, or the compensation of the
general partner in the proposed limited partnership rollup
transaction from each of the original limited partnerships;
``(ii) the conflicts of interest, if any, of the general
partner;
``(iii) whether it is expected that there will be a
significant difference between the exchange values of the
limited partnerships and the trading price of the securities
to be issued in the limited partnership rollup transaction;
``(iv) the valuation of the limited partnerships and the
method used to determine the value of the interests of the
limited partners to be exchanged for the securities in the
limited partnership rollup transaction;
``(v) the differing risks and effects of the limited
partnership rollup transaction for investors in different
limited partnerships proposed to be included, and the risks
and effects of completing the limited partnership rollup
transaction with less than all limited partnerships;
``(vi) the statement by the general partner required
under subparagraph (E);
``(vii) such other matters deemed necessary or
appropriate by the Commission;
``(E) require a statement by the general partner as to
whether the proposed limited partnership rollup transaction is
fair or unfair to investors in each limited partnership, a
discussion of the basis for that conclusion, and an evaluation
and a description by the general partner of alternatives to the
limited partnership rollup transaction, such as liquidation;
``(F) provide that, if the general partner or sponsor has
obtained any opinion (other than an opinion of counsel),
appraisal, or report that is prepared by an outside party and
that is materially related to the limited partnership rollup
transaction, such soliciting materials shall contain or be
accompanied by clear, concise, and comprehensible disclosure
with respect to--
``(i) the analysis of the transaction, scope of review,
preparation of the opinion, and basis for and methods of
arriving at conclusions, and any representations and
undertakings with respect thereto;
``(ii) the identity and qualifications of the person who
prepared the opinion, the method of selection of such
person, and any material past, existing, or contemplated
relationships between the person or any of its affiliates
and the general partner, sponsor, successor, or any other
affiliate;
``(iii) any compensation of the preparer of such
opinion, appraisal, or report that is contingent on the
transaction's approval or completion; and
``(iv) any limitations imposed by the issuer on the
access afforded to such preparer to the issuer's personnel,
premises, and relevant books and records;
``(G) provide that, if the general partner or sponsor has
obtained any opinion, appraisal, or report as described in
subparagraph (F) from any person whose compensation is
contingent on the transaction's approval or completion or who
has not been given access by the issuer to its personnel and
premises and relevant books and records, the general partner or
sponsor shall state the reasons therefor;
``(H) provide that, if the general partner or sponsor has
not obtained any opinion on the fairness of the proposed limited
partnership rollup transaction to investors in each of the
affected partnerships, such soliciting materials shall contain
or be accompanied by a statement of such partner's or sponsor's
reasons for concluding that such an opinion is not necessary in
order to permit the limited partners to make an informed
decision on the proposed transaction;
``(I) require that the soliciting material include a clear,
concise, and comprehensible summary of the limited partnership
rollup transaction (including a summary of the matters referred
to in clauses (i) through (vii) of subparagraph (D) and a
summary of the matter referred to in subparagraphs (F), (G), and
(H)), with the risks of the limited partnership rollup
transaction set forth prominently in the fore part thereof;
``(J) provide that any solicitation or offering period with
respect to any proxy solicitation, tender offer, or information
statement in a limited partnership rollup transaction shall be
for not less than the lesser of 60 calendar days or the maximum
number of days permitted under applicable State law; and
``(K) contain such other provisions as the Commission
determines to be necessary or appropriate for the protection of
investors in limited partnership rollup transactions.
``(2) Exemptions.--The Commission may, consistent with the
public interest, the protection of investors, and the purposes of
this title, exempt by rule or order any security or class of
securities, any transaction or class of transactions, or any person
or class of persons, in whole or in part, conditionally or
unconditionally, from the requirements imposed pursuant to paragraph
(1) or from the definition contained in paragraph (4).
``(3) Effect on commission authority.--Nothing in this
subsection limits the authority of the Commission under subsection
(a) or (d) or any other provision of this title or precludes the
Commission from imposing, under subsection (a) or (d) or any other
provision of this title, a remedy or procedure required to be
imposed under this subsection.
``(4) Definition of limited partnership rollup transaction.--
Except as provided in paragraph (5), as used in this subsection, the
term `limited partnership rollup transaction' means a transaction
involving the combination or reorganization of one or more limited
partnerships, directly or indirectly, in which--
``(A) some or all of the investors in any of such limited
partnerships will receive new securities, or securities in
another entity, that will be reported under a transaction
reporting plan declared effective before the date of enactment
of this subsection by the Commission under section 11A;
``(B) any of the investors' limited partnership securities
are not, as of the date of filing, reported under a transaction
reporting plan declared effective before the date of enactment
of this subsection by the Commission under section 11A;
``(C) investors in any of the limited partnerships involved
in the transaction are subject to a significant adverse change
with respect to voting rights, the term of existence of the
entity, management compensation, or investment objectives; and
``(D) any of such investors are not provided an option to
receive or retain a security under substantially the same terms
and conditions as the original issue.
``(5) Exclusions from definition.--Notwithstanding paragraph
(4), the term `limited partnership rollup transaction' does not
include--
``(A) a transaction that involves only a limited partnership
or partnerships having an operating policy or practice of
retaining cash available for distribution and reinvesting
proceeds from the sale, financing, or refinancing of assets in
accordance with such criteria as the Commission determines
appropriate;
``(B) a transaction involving only limited partnerships
wherein the interests of the limited partners are repurchased,
recalled, or exchanged in accordance with the terms of the
preexisting limited partnership agreements for securities in an
operating company specifically identified at the time of the
formation of the original limited partnership;
``(C) a transaction in which the securities to be issued or
exchanged are not required to be and are not registered under
the Securities Act of 1933;
``(D) a transaction that involves only issuers that are not
required to register or report under section 12, both before and
after the transaction;
``(E) a transaction, except as the Commission may otherwise
provide by rule for the protection of investors, involving the
combination or reorganization of one or more limited
partnerships in which a non-affiliated party succeeds to the
interests of a general partner or sponsor, if--
``(i) such action is approved by not less than 66\2/3\
percent of the outstanding units of each of the
participating limited partnerships; and
``(ii) as a result of the transaction, the existing
general partners will receive only compensation to which
they are entitled as expressly provided for in the
preexisting limited partnership agreements; or
``(F) a transaction, except as the Commission may otherwise
provide by rule for the protection of investors, in which the
securities offered to investors are securities of another entity
that are reported under a transaction reporting plan declared
effective before the date of enactment of this subsection by the
Commission under section 11A, if--
``(i) such other entity was formed, and such class of
securities was reported and regularly traded, not less than
12 months before the date on which soliciting material is
mailed to investors; and
``(ii) the securities of that entity issued to investors
in the transaction do not exceed 20 percent of the total
outstanding securities of the entity, exclusive of any
securities of such class held by or for the account of the
entity or a subsidiary of the entity.''.
(b) Schedule for Regulations.--The Securities and Exchange
Commission shall conduct rulemaking proceedings and prescribe final
regulations under the Securities Act of 1933 and the Securities Exchange
Act of 1934 to implement the requirements of section 14(h) of the
Securities Exchange Act of 1934, as amended by subsection (a), and such
regulations shall become effective not later than 12 months after the
date of enactment of this Act.
(c) Evaluation of Fairness Opinion Preparation, Disclosure, and
Use.--
(1) Evaluation required.--The Comptroller General of the United
States shall, within 18 months after the date of enactment of this
Act, conduct a study of--
(A) the use of fairness opinions in limited partnership
rollup transactions;
(B) the standards which preparers use in making
determinations of fairness;
(C) the scope of review, quality of analysis, qualifications
and methods of selection of preparers, costs of preparation, and
any limitations imposed by issuers on such preparers;
(D) the nature and quality of disclosures provided with
respect to such opinions;
(E) any conflicts of interest with respect to the
preparation of such opinions; and
(F) the usefulness of such opinions to limited partners.
(2) Report required.--Not later than the end of the 18-month
period referred to in paragraph (1), the Comptroller General of the
United States shall submit to the Congress a report on the
evaluation required by paragraph (1).

714c4150d7b0df7c5a40d4a9714746821409ebe83fb280b2312fa62316b1a8fa

(a) Registered Securities Association Rule.--Section 15A(b) of the
Securities Exchange Act of 1934 (15 U.S.C. 78o-3(b)) is amended by
adding at the end the following new paragraph:
``(12) The rules of the association to promote just and
equitable principles of trade, as required by paragraph (6), include
rules to prevent members of the association from participating in
any limited partnership rollup transaction (as such term is defined
in paragraphs (4) and (5) of section 14(h)) unless such transaction
was conducted in accordance with procedures designed to protect the
rights of limited partners, including--
``(A) the right of dissenting limited partners to one of the
following:
``(i) an appraisal and compensation;
``(ii) retention of a security under substantially the
same terms and conditions as the original issue;
``(iii) approval of the limited partnership rollup
transaction by not less than 75 percent of the outstanding
securities of each of the participating limited
partnerships;
``(iv) the use of a committee that is independent, as
determined in accordance with rules prescribed by the
association, of the general partner or sponsor, that has
been approved by a majority of the outstanding securities of
each of the participating partnerships, and that has such
authority as is necessary to protect the interest of limited
partners, including the authority to hire independent
advisors, to negotiate with the general partner or sponsor
on behalf of the limited partners, and to make a
recommendation to the limited partners with respect to the
proposed transaction; or
``(v) other comparable rights that are prescribed by
rule by the association and that are designed to protect
dissenting limited partners;
``(B) the right not to have their voting power unfairly
reduced or abridged;
``(C) the right not to bear an unfair portion of the costs
of a proposed limited partnership rollup transaction that is
rejected; and
``(D) restrictions on the conversion of contingent interests
or fees into non-contingent interests or fees and restrictions
on the receipt of a non-contingent equity interest in exchange
for fees for services which have not yet been provided.
As used in this paragraph, the term `dissenting limited partner'
means a person who, on the date on which soliciting material is
mailed to investors, is a holder of a beneficial interest in a
limited partnership that is the subject of a limited partnership
rollup transaction, and who casts a vote against the transaction and
complies with procedures established by the association, except that
for purposes of an exchange or tender offer, such person shall file
an objection in writing under the rules of the association during
the period in which the offer is outstanding.''.
(b) Listing Standards of National Securities Exchanges.--Section
6(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78f(b)) is
amended by adding at the end the following:
``(9) The rules of the exchange prohibit the listing of any
security issued in a limited partnership rollup transaction (as such
term is defined in paragraphs (4) and (5) of section 14(h)), unless
such transaction was conducted in accordance with procedures
designed to protect the rights of limited partners, including--
``(A) the right of dissenting limited partners to one of the
following:
``(i) an appraisal and compensation;
``(ii) retention of a security under substantially the
same terms and conditions as the original issue;
``(iii) approval of the limited partnership rollup
transaction by not less than 75 percent of the outstanding
securities of each of the participating limited
partnerships;
``(iv) the use of a committee of limited partners that
is independent, as determined in accordance with rules
prescribed by the exchange, of the general partner or
sponsor, that has been approved by a majority of the
outstanding units of each of the participating limited
partnerships, and that has such authority as is necessary to
protect the interest of limited partners, including the
authority to hire independent advisors, to negotiate with
the general partner or sponsor on behalf of the limited
partners, and to make a recommendation to the limited
partners with respect to the proposed transaction; or
``(v) other comparable rights that are prescribed by
rule by the exchange and that are designed to protect
dissenting limited partners;
``(B) the right not to have their voting power unfairly
reduced or abridged;
``(C) the right not to bear an unfair portion of the costs
of a proposed limited partnership rollup transaction that is
rejected; and
``(D) restrictions on the conversion of contingent interests
or fees into non-contingent interests or fees and restrictions
on the receipt of a non-contingent equity interest in exchange
for fees for services which have not yet been provided.
As used in this paragraph, the term `dissenting limited partner'
means a person who, on the date on which soliciting material is
mailed to investors, is a holder of a beneficial interest in a
limited partnership that is the subject of a limited partnership
rollup transaction, and who casts a vote against the transaction and
complies with procedures established by the exchange, except that
for purposes of an exchange or tender offer, such person shall file
an objection in writing under the rules of the exchange during the
period during which the offer is outstanding.''.
(c) Standards for Automated Quotation Systems.--Section 15A(b) of
the Securities Exchange Act of 1934 (15 U.S.C. 78o-3(b)) is amended by
adding at the end the following new paragraph:
``(13) The rules of the association prohibit the authorization
for quotation on an automated interdealer quotation system sponsored
by the association of any security designated by the Commission as a
national market system security resulting from a limited partnership
rollup transaction (as such term is defined in paragraphs (4) and
(5) of section 14(h)), unless such transaction was conducted in
accordance with procedures designed to protect the rights of limited
partners, including--
``(A) the right of dissenting limited partners to one of the
following:
``(i) an appraisal and compensation;
``(ii) retention of a security under substantially the
same terms and conditions as the original issue;
``(iii) approval of the limited partnership rollup
transaction by not less than 75 percent of the outstanding
securities of each of the participating limited
partnerships;
``(iv) the use of a committee that is independent, as
determined in accordance with rules prescribed by the
association, of the general partner or sponsor, that has
been approved by a majority of the outstanding securities of
each of the participating partnerships, and that has such
authority as is necessary to protect the interest of limited
partners, including the authority to hire independent
advisors, to negotiate with the general partner or sponsor
on behalf of the limited partners, and to make a
recommendation to the limited partners with respect to the
proposed transaction; or
``(v) other comparable rights that are prescribed by
rule by the association and that are designed to protect
dissenting limited partners;
``(B) the right not to have their voting power unfairly
reduced or abridged;
``(C) the right not to bear an unfair portion of the costs
of a proposed limited partnership rollup transaction that is
rejected; and
``(D) restrictions on the conversion of contingent interests
or fees into non-contingent interests or fees and restrictions
on the receipt of a non-contingent equity interest in exchange
for fees for services which have not yet been provided.
As used in this paragraph, the term `dissenting limited partner'
means a person who, on the date on which soliciting material is
mailed to investors, is a holder of a beneficial interest in a
limited partnership that is the subject of a limited partnership
rollup transaction, and who casts a vote against the transaction and
complies with procedures established by the association, except that
for purposes of an exchange or tender offer, such person shall file
an objection in writing under the rules of the association during
the period during which the offer is outstanding.''.

ddce22ec80e11a0aff39f4091f1fa1fa81ef2dd370cfd38ef0f09083199b4bbb

(a) Effective Date.--
(1) In general.--The amendments made by section 303 shall become
effective 12 months after the date of enactment of this Act.
(2) Rulemaking authority.--Notwithstanding paragraph (1), the
authority of the Securities and Exchange Commission, a registered
securities association, and a national securities exchange to
commence rulemaking proceedings for the purpose of issuing rules
pursuant to the amendments made by section 303 is effective on the
date of enactment of this Act.
(3) Review of filings prior to effective date.--Prior to the
effective date of regulations promulgated pursuant to this title,
the Securities and Exchange Commission shall continue to review and
declare effective registration statements and amendments thereto
relating to limited partnership rollup transactions in accordance
with applicable regulations then in effect.
(b) Effect on Existing Authority.--The amendments made by this title
shall not limit the authority of the Securities and Exchange Commission,
a registered securities association, or a national securities exchange
under any provision of the Securities Exchange Act of 1934, or preclude
the Commission or such association or exchange from imposing, under any
other such provision, a remedy or procedure required to be imposed under
such amendments.
Speaker of the House of Representatives.
Vice President of the United States and
President of the Senate.

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Government Securities Act Amendments of 1993

Other Sections

TITLE I

TITLE III

TITLE II

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