Sec. 5. Approval of subsidiaries of insured depository institutions and Federal qualified nonbank payment stablecoin issuers
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/bill/118/hr/4766/ih/section-5A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Any insured depository institution that seeks to issue payment stablecoins through a subsidiary and any nonbank entity (other than a State qualified payment stablecoin issuer) that seeks to issue payment stablecoins shall file an application with the primary Federal payment stablecoin regulator. With respect to an application filed under this paragraph, the primary Federal payment stablecoin regulator shall inform the applicant whether the applicant has submitted a complete application within 45 days of receiving the application.
With respect to an application filed under this paragraph, once the primary Federal payment stablecoin regulator has informed the applicant that the application is complete, such application shall be deemed to be complete unless the primary Federal payment stablecoin regulator determines that a significant change in circumstances requires otherwise. A complete application received under paragraph
(1)shall be evaluated by the primary Federal payment stablecoin regulator using the factors described in paragraph (3). The factors described in this paragraph are the following: The ability of the applicant (or, in the case of an applicant that is an insured depository institution, the subsidiary of the applicant), based on the financial condition and resources, to meet the requirements set forth in section 4. The general character and fitness of the management of the applicant. The risks presented by the applicant and benefits provided to consumers. The primary Federal payment stablecoin regulator shall render a decision on an application no later than 120 days after informing the applicant that the application is complete. The primary Federal payment stablecoin regulator may only deny a complete application received under paragraph
(1)if the regulator determines that the activities of the applicant would be unsafe or unsound based on the factors described in paragraph (3). If the primary Federal payment stablecoin regulator denies a complete application received under paragraph (1), the regulator shall provide the applicant with written notice explaining such denial, including all findings made by the regulator with respect to all identified material shortcomings regarding the application, including recommendations on how the applicant could address the identified material shortcomings. Not later than 30 days after the date of receipt of any notice of the denial of an application under this subsection, the applicant may request, in writing, an opportunity for a written or oral hearing before the primary Federal payment stablecoin regulator to appeal the denial. Upon receipt of a timely request, the primary Federal payment stablecoin regulator shall notice a time (not later than 30 days after the date of receipt of the request) and place at which the applicant may appear, personally or through counsel, to submit written materials or provide oral testimony and oral argument). Not later than 60 days after the date of a hearing under this clause, the primary Federal payment stablecoin regulator shall notify the applicant of the final determination of the primary Federal payment stablecoin regulator, which shall contain a statement of the basis for that determination, with specific findings. If an applicant does not make a timely request for a hearing under this clause, the primary Federal payment stablecoin regulator shall notify the applicant, not later than 10 days after the date by which the applicant may request a hearing under this clause, in writing, that the denial of the application is a final determination of the regulator. If the primary Federal payment stablecoin regulator fails to render a decision on a complete application within the time period specified in subparagraph (A), the application shall be deemed approved. The denial of an application under this subsection shall not prohibit the applicant from filing a subsequent application. Each primary Federal payment stablecoin regulator shall annually report to Congress on the applications that have been pending for 6 months or longer since the date of the initial application filed under paragraph
(1)where the applicant has been informed that the application remains incomplete, including providing documentation on the status of the application and why the application has not yet been approved. The primary Federal regulatory agencies shall, jointly, issue rules necessary for the regulation of the issuance of payment stablecoins, but may not impose requirements inconsistent with the requirements specified under section 4. This section shall take effect on the earlier of— 18 months after the date of enactment of this Act; or the date that is 120 days after the date on which the primary Federal payment stablecoin regulators issue final regulations implementing this section. The primary Federal payment stablecoin regulators may, before the effective date described under paragraph (1)— issue regulations to carry out this section; and pursuant to regulations described under subparagraph (A), accept and process applications described under this section. Each of the primary Federal payment stablecoin regulators shall notify Congress once beginning to process applications described under this section. The primary Federal payment stablecoin regulator may waive the application of the requirements of this section for a period not to exceed 12 months beginning on the effective date described under paragraph (1), with respect to— a subsidiary of an insured depository institution, if the insured depository institution has an application pending for the subsidiary to become a permitted payment stablecoin issuer on the effective date described under paragraph (1); or a nonbank entity with an application pending to become a Federal qualified nonbank stablecoin issuer on the effective date described under paragraph (1).