formal interpretations, and interpretations or approvals issued by an authorized official or employee of the Federal Reserve System) that might mecessitate the amendment of State law for the exemption to continue. (4) No exemption shall extend to the administrative enforcement or civil liability provisions of sections 704 and 706 of of the Act. After an exemption is granted, the requirements of the applicable State law shall constitute the requirements of sections 701 and 702 of the Act. (f) Adverse Determination. (1) If, after publication of a notice in the Federal Register as provided under paragraph (d), the Board finds on the basis of the information before it that it cannot make a favorable determination in connection with the application, the Board shall notify the appropriate State official of the facts upon which such findings are based and shall afford that State authority a reasonable opportunity to demonstrate or achieve compliance, (2) If, after having afforded the State authority such opportunity to demonstrate or achieve compliance, the Board finds on the basis of the information before it that it still cannot make a favorable determination in connection with the application, the Board shall publish in the Federal Register a notice of its determination regarding the application and shall furnish a copy of such notice to the State official who made application for such exemption. (g) Revocation of Exemption. (1) The Board reserves the right to revoke any exemption granted under the provisions of this Supplement if at any time it determines that the State law does not, in fact, impose requirements that are substantially similar to, or that provide greater protection to applicants than, those imposed under sections 701 and 702 of the Act or that there is not, in fact, adequate provision for State enforcement. (2) Before revoking any such exemption, the Board shall notify the appropriate State official of the facts or conduct that, in the Board's opinion, warrants such revocation, and shall afford that State such opportunity as the Board deems appropriate in the circumstances to demonstrate or achieve compliance. (3) If, after having been afforded the opportunity to demonstrate or achieve compliance, the Board determines that the State has not done so, notice of the Board's intention to revoke such exemption shall be published as a notice of proposed rule making in the Federal Register. A period of time shall be allowed from the date of such publication for the Board to receive written comments from interested persons to submit written comments to the Board regarding the proposed rule making. (4) If such exemption is revoked, notice of such revocation shall be published by the Board in the Federal Register, and a copy of such notice shall be furnished to the appropriate State official, to the Federal authorities responsible for enforcement of the requirements of the Act, and to the Attorney General of the United States. The revocation shall become effective, and the class of transactions affected within that State shall become subject to the requirements of sections 701 and 702 of the Act, 90 days after the date of publication of the notice in the Federal Register. To aid in the consideration of this matter by the Board, interested persons are invited to submit relevant data or comments. Members of the public are urged to comment not only on provisions they believe should be changed or added, but also on proposed provisions they believe should remain in the regulation. All comments should be submitted in writing to the Secretary, Board of Governors of the Federal Reserve System, Washington, D.C. 20551, to be received not later than December 3, 1976. Written comments will be made available for public inspection and copying upon request except as provided in § 261.6(a) of the Board rules regarding availability of information (12 CFR 261). All material submitted should include the docket number R-0031. This notice of proposed rulemaking is published pursuant to the Board's authority under § 703(a) of the Equal Credit Opportunity Act (15 U.S.C. 1691 b). By order of the Board of Governors, November 1, 1976. [SEAL] (signed) Theodore E. Allison Theodore E. Allison Public Law 94-239 94th Congress, H. R. 6516 An Act To amend title VII of the Consumer Credit Protection Act to include discrimination on the basis of race, color, religion, national origin, and age, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That (a) this Act may be cited as the "Equal Credit Opportunity Act Amendments of 1976". (b) Title VII of the Consumer Credit Protection Act is amended by adding at the end thereof the following new section: "§ 709. Short title "This title may be cited as the 'Equal Credit Opportunity Act'." "§ 701. Prohibited discrimination; reasons for adverse action "(1) on the basis of race, color, religion, national origin, sex or marital status, or age (provided the applicant has the capacity to contract); "(2) because all or part of the applicant's income derives from any public assistance program; or "(3) because the applicant has in good faith exercised any right under the Consumer Credit Protection Act. "(b) It shall not constitute discrimination for purposes of this title note. for a creditor "(1) to make an inquiry of marital status if such inquiry is for the purpose of ascertaining the creditor's rights and remedies applicable to the particular extension of credit and not to discriminate in a determination of credit-worthiness; "(2) to make an inquiry of the applicant's age or of whether the applicant's income derives from any public assistance program if such inquiry is for the purpose of determining the amount and probable continuance of income levels, credit history, or other pertinent element of credit-worthiness as provided in regulations of the Board; "(3) to use any empirically derived credit system which considers age if such system is demonstrably and statistically sound in accordance with regulations of the Board, except that in the operation of such system the age of an elderly applicant may not be assigned a negative factor or value; or "(4) to make an inquiry or to consider the age of an elderly applicant when the age of such applicant is to be used by the creditor in the extension of credit in favor of such applicant. "(c) It is not a violation of this section for a creditor to refuse to extend credit offered pursuant to— "(1) any credit assistance program expressly authorized by law for an economically disadvantaged class of persons; Notice. Statement of reasons. "Adverse action. " 15 USC 1691b. Consumer Advisory Council. Establishment. Pub. Law 94-239 2 March 23, 1976 "(2) any credit assistance program administered by a nonprofit organization for its members or an economically disadvantaged class of persons; or "(3) any special purpose credit program offered by a profitmaking organization to meet special social needs which meets standards prescribed in regulations by the Board; if such refusal is required by or made pursuant to such program. “(d)(1) Within thirty days (or such longer reasonable time as specified in regulations of the Board for any class of credit transaction) after receipt of a completed application for credit, a creditor shall notify the applicant of its action on the application. "(2) Each applicant against whom adverse action is taken shall be entitled to a statement of reasons for such action from the creditor. A creditor satisfies this obligation by "(A) providing statements of reasons in writing as a matter of course to applicants against whom adverse action is taken; or "(B) giving written notification of adverse action which discloses (i) the applicant's right to a statement of reasons within thirty days after receipt by the creditor of a request made within sixty days after such notification, and (ii) the identity of the person or office from which such statement may be obtained. Such statement may be given orally if the written notification advises the applicant of his right to have the statement of reasons confirmed in writing on written request. "(3) A statement of reasons meets the requirements of this section only if it contains the specific reasons for the adverse action taken. "(4) Where a creditor has been requested by a third party to make a specific extension of credit directly or indirectly to an applicant, the notification and statement of reasons required by this subsection may be made directly by such creditor, or indirectly through the third party, provided in either case that the identity of the creditor is disclosed. "(5) The requirements of paragraph (2), (3), or (4) may be satisfied by verbal statements or notifications in the case of any creditor who did not act on more than one hundred and fifty applications during the calendar year preceding the calendar year in which the adverse action is taken, as determined under regulations of the Board. "(6) For purposes of this subsection, the term 'adverse action' means a denial or revocation of credit, a change in the terms of an existing credit arrangement, or a refusal to grant credit in substantially the amount or on substantially the terms requested. Such term does not include a refusal to extend additional credit under an existing credit arrangement where the applicant is delinquent or otherwise in default, or where such additional credit would exceed a previously established credit limit.". SEC. 3. (a) Section 703 of the Equal Credit Opportunity Act is amended (1) by inserting "(a)" immediately before "The Board"; (2) by inserting after the second sentence thereof the following new sentence: "In particular, such regulations may exempt from one or more of the provisions of this title any class of transactions not primarily for personal, family, or household purposes, if the Board makes an express finding that the application of such provision or provisions would not contribute substantially to carrying out the purposes of this title."; and (3) by adding at the end thereof the following new subsection: "(b) The Board shall establish a Consumer Advisory Council to advise and consult with it in the exercise of its functions under the 90 STAT. 252 |