Sec. 311. Establishment
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Under such regulations as the Director may prescribe, the Director shall provide for the organization, incorporation, examination, operation, and regulation of a national mortgage market utility ( Utility ), and issuance of a charter for such Utility. The Utility shall be organized, operated, and managed as a not-for-profit entity. Subject to the terms of this subtitle and any regulations issued by the Director, a person or entity may file an application with the Director to establish the Utility.
The Utility may be chartered as a corporation, mutual association, partnership, limited liability corporation, cooperative, or any other organizational form that the applicant may deem appropriate. An application for establishment of the Utility shall include— the proposed articles of association; a statement of the general object and purpose of the Utility, consistent with the provisions of this subtitle; the proposed capitalization and business plan for the Utility; the proposed State whose law would govern, by election of the applicant, the operation of the Utility to the extent not otherwise covered by this subtitle; information on the financial resources of the applicant; a statement of the relevant housing finance experience of the applicant; identification of the proposed senior managers of the Utility, and the relevant experience of such individuals; and any other information the Director determines to be necessary to evaluate the background, experience, and integrity of the applicant and the proposed senior managers, or information otherwise relevant to determine the likely success of the proposed Utility.
Not later than the end of the 2-year period following the date of the enactment of this Act, the Director shall issue a charter for the Utility to the applicant that the Director determines, in the Director’s sole discretion, has the managerial, financial, and operational resources to succeed, consistent with the purposes of this subtitle. At the discretion of the Director, the charter may require the Utility to obtain specific approval from the Director before commencing any business operation, including operations related to the Platform or the Repository, which approval shall be provided when the Director determines, in the Director’s sole discretion, that the Utility demonstrates appropriate operational, managerial, and governance capability with regard to such operation, including successful completion of testing and transition periods.
In making a determination under paragraph (1), the Director shall consider the competence, experience, and integrity of the applicant and proposed senior managers of the Utility, and the financial and operational resources and future prospects of the Utility. The Director may not issue a charter if the applicant fails to— comply with all applicable formation requirements; provide all information requested by the Director; demonstrate the competence, experience, and integrity necessary to operate the Utility in a safe and sound manner; demonstrate sufficient financial resources necessary to operate the Utility in a safe and sound manner; provide the Director with assurances that it will operate and maintain the Platform in an open-access manner that does not discriminate against eligible loan originators, aggregators, or qualified issuers; or provide the Director with assurances that the Utility will make available to the Director, on an on-going basis, such information on the operation and activities of the Utility, or any affiliate of the Utility, that the Director deems necessary to ensure the safe and sound operation of the Utility and to enforce compliance with this subtitle.
Within 30 days of denying any application for the issuance of a charter under this section, the Director shall provide the applicant with a written explanation of the basis for the denial. The authority of the Director shall include the authority to suspend the charter of the Utility, if the Director determines, in the Director’s discretion, that— the organizers have failed to make adequate progress in establishing the Utility or any business operation; the organizers engaged in waste of appropriated funds made available for establishment of the Repository; or such suspension is necessary for any other reason related to safe and sound operation of the Utility.
The Director shall issue regulations to address suspension of the charter, including a process for remediation. The Utility is not, and shall not be deemed to be, a department, agency, or instrumentality of the United States Government and shall not be subject to title 5 or 31 of the United States Code. Notwithstanding any other provision of law, the Utility shall be subject to the exclusive supervision and regulation by the Agency, and shall not be subject to supervision or regulation by any other Federal department or agency or by any State.
The Utility is authorized to conduct its business without regard to any qualification or similar statute in any State. The Utility shall be exempt from all taxation imposed by the United States, any territory, dependency, or possession of the United States or any State, county, municipality, or local taxing authority, except that any real property of the Repository shall be subject to State, territorial, county, municipal, or local taxation to the same extent according to its value as other real property.
The Utility shall be governed by a board of directors, which shall consist of a number of directors determined by the Director to meet the needs of the Utility, of which— not less than two members shall be from larger financial institutions; not less than two members shall be from smaller financial institutions; not less than two members shall have expertise in residential mortgage securitizations, not less than two members shall have expertise in legal and electronic documentation and systems; and such other members as the Director may provide, who shall have such qualifications as the Director may establish in the charter or by regulation to meet the requirements for independence and any provisions of applicable State law.
Commencing with the first annual report of the Director following the date of the enactment of this Act, the annual report of the Director under section 1319B of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 ( 12 U.S.C. 4521 ) shall include a description of the Agency’s activities with regard to organization, incorporation, examination, operation, and regulation of the Utility.
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U.S. Code