§ 3121. Procedure

3,519 words·~16 min read·/usc/title-31/section-3121

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(a)In issuing obligations under sections 3102–3104 of this title, the Secretary of the Treasury may prescribe—

(1)whether an obligation is to be issued on an interest-bearing basis, a discount basis, or an interest-bearing and discount basis;

(2)regulations on the conditions under which the obligation will be offered for sale, including whether it will be offered for sale on a competitive or other basis;

(3)the offering price and interest rate;

(4)the method of computing the interest rate;

(5)the dates for paying principal and interest;

(6)the form and denominations of the obligations; and

(7)other conditions.

(1)Under conditions prescribed by the Secretary, an obligation issued under this chapter and redeemable on demand of the owner or holder may be used to pay the United States Government for taxes imposed by it.

(2)An obligation of the Government issued after March 3, 1971, under law may not be redeemed before its maturity to pay a tax imposed by the Government in an amount more than the fair market value of the obligation at the time of its redemption. This paragraph does not apply to a Treasury bill issued under section 3104 of this title.

(c)Under conditions prescribed by the Secretary, an obligation authorized by this chapter may be issued in exchange for an obligation of an agency whose principal and interest are unconditionally guaranteed by the Government at or before maturity.

(d)Under conditions prescribed by the Secretary, the Secretary may issue registered bonds in exchange for and instead of coupon bonds that have been or may be issued. The registered bonds shall be similar in all respects to the registered bonds issued under a law authorizing the issue of coupon bonds offered for exchange.

(e)A decision of the Secretary about an issue of obligations under sections 3102–3104 of this title is final.

(f)The Secretary may accept voluntary services in carrying out the sale of public debt obligations.

(1)In this subsection, “registration-required obligation” means an obligation except an obligation—

(A)not of a type offered to the public; or

(B)having a maturity (at issue) of not more than one year.

(2)Every registration-required obligation of the Government shall be in registered form. A book entry obligation is deemed to be in registered form if the right to principal and stated interest on the obligation may be transferred only through a book entry consistent with regulations of the Secretary.

(3)The Secretary shall prescribe regulations necessary to carry out this subsection when there is a nominee.

(1)The Secretary shall prescribe by regulation standards for the safeguarding and use of obligations issued under this chapter, and obligations otherwise issued or guaranteed as to principal or interest by the United States. Such regulations shall apply only to a depository institution that is not a government securities broker or a government securities dealer and that holds such obligations as fiduciary, custodian, or otherwise for the account of a customer and not for its own account. Such regulations shall provide for the adequate segregation of obligations so held, including obligations which are purchased or sold subject to resale or repurchase.

(2)Violation of a regulation prescribed under paragraph

(1)shall constitute adequate basis for the issuance of an order under section 5239(a) or

(b)of the Revised Statutes (12 U.S.C. 93(a) or (b)), section 8(b) or 8(c) of the Federal Deposit Insurance Act, section 5(d)(2) or 5(d)(3) 1 of the Home Owners’ Loan Act of 1933, section 407(e) or 407(f) 1 of the National Housing Act, or section 206(e) or 206(f) of the Federal Credit Union Act. Such an order may be issued with respect to a depository institution by its appropriate regulatory agency and with respect to a federally insured credit union by the National Credit Union Administration Board.

(3)Nothing in this subsection shall be construed to affect in any way the powers of such agencies under any other provision of law.

(4)The Secretary shall, prior to adopting regulations under this subsection, determine with respect to each appropriate regulatory agency and the National Credit Union Administration Board, whether its rules and standards adequately meet the purposes of regulations to be promulgated under this subsection, and if the Secretary so determines, shall exempt any depository institution subject to such rules or standards from the regulations promulgated under this subsection.

(5)As used in this subsection—

(A)“depository institution” has the meaning stated in clauses

(i)through

(vi)of section 19(b)(1)(A) of the Federal Reserve Act and also includes a foreign bank, an agency or branch of a foreign bank, and a commercial lending company owned or controlled by a foreign bank (as such terms are defined in the International Banking Act of 1978).

(B)“government securities broker” has the meaning prescribed in section 3(a)(43) of the Securities Exchange Act of 1934.

(C)“government securities dealer” has the meaning prescribed in section 3(a)(44) of the Securities Exchange Act of 1934.

(D)“appropriate regulatory agency” has the meaning prescribed in section 3(a)(34)(G) of the Securities Exchange Act of 1934.

(Pub. L. 97–258, Sept. 13, 1982, 96 Stat. 944; Pub. L. 97–452, § 1(9), Jan. 12, 1983, 96 Stat. 2468; Pub. L. 99–571, title II, § 201(a), Oct. 28, 1986, 100 Stat. 3222; Pub. L. 111–147, title V, § 502(d), Mar. 18, 2010, 124 Stat. 108.)

In subsection (a)(1), the word “combination” is omitted as surplus.

In subsection (a)(2), the word “conditions” is substituted for “terms and conditions” because it is inclusive.

In subsection (a)(3), the words “offering” and “interest rate” are added for clarity.

In subsection (b)(1), the word “issued” is substituted for “authorized” for clarity. The words “the Commissioner of Internal Revenue” are omitted because of the source provisions restated in section 321 of the revised title.

In subsection (b)(2), the words “In the case of” are omitted as surplus. The words “under law” are substituted for “under this Act or under any other provision of law” because they are inclusive. The words “the terms and conditions of issue” are omitted as unnecessary. The word “permit” is omitted as surplus.

In subsection (c), the word “conditions” is substituted for “regulations and upon such terms” to eliminate unnecessary words and for consistency in the revised title and with other titles of the United States Code. The word “agency” is substituted for “agency or instrumentality of the United States” because of section 101 of the revised title and for consistency.

In subsection (d), the word “conditions” is substituted for “terms and under such regulations” to eliminate unnecessary words and for consistency in the revised title and with other titles of the Code. The words “instead of” are substituted for “in lieu of” for clarity.

In subsection (f), the words “in carrying out” are substituted for “in connection with the program for” to eliminate unnecessary words.

In subsection (g)(1), before clause (A), the words “Except as provided in paragraph (2)” and “(2) The term ‘registration-required obligation’ shall not include any obligation if” are omitted because of the restatement. Clause

(C)is added for clarity.

In subsection (g)(2)(B)(i), the words “territories and” are added for consistency in the revised title and with other titles of the United States Code.

In subsection (g)(3), the words “(or of any agency or instrumentality thereof)” are omitted as included in “Government”. The words “For purposes of subsection (a)” are omitted as surplus. The words “is deemed to be” are substituted for “shall be treated as” for consistency in the revised title and with other titles of the Code.

In subsection (g)(4), the words “or chain of nominees” are omitted as included in “nominee” and because of 1:1.

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