bers: Provided, Such trust or other association:

(1) Shall not be an agent of any insurer;

(2) Shall agree in writing to be bound by these guidelines; and

(3) Shall agree in writing to submit its records and affairs to inspection by the Administrator as he may require.

(f) The credit union may remit premiums to an insurer or the holder of a master policy on behalf of a credit union member: Provided, The credit union obtains written authorization from such member for remittance by share withdrawals or through proceeds of loans made to such member.

(g) The credit union may make insurance application forms available to its members and may provide instructions on predetermined published insurance rates and such other information as may be required by law.

(h) The credit union may issue certificates of insurance where the credit union is the policyholder or a subgroup under a master policy in a group insurance plan.

(i) The credit union may purchase certain insurance such as life savings insurance and loan protection insurance for all members of the credit union eligible for insurance who have loans or shares: Provided, The cost of the loan protection insurance (if passed on to the borrower as a condition precedent to making the loan) and other incidental costs, including the interest on the loan, cannot exceed the statutory rate of 1 percent per month on the unpaid balance. Where insurance is required as a condition precedent to making the loan, the borrower must be informed that he may select an insurer of his own choice.

(j) The credit union may not, directly or indirectly, act as agent for an insurer or trust or association described in paragraph (e) of this section in processing of claims or in any other agency capacity for such insurer or trust or association described in paragraph (e) of this section. Neither an insurer nor a trust or association described in paragraph (e) of this section may have an agent or employee permanently or regularly on the premises of the credit union for the purpose of conducting insurance business with the members. Notwithstanding the foregoing, in those States where a licensed agent is required in order to engage in activities authorized in this section, an employee of the particular credit

union concerned may act in such an agency capacity, Provided, That neither the employee nor the credit union may receive any remuneration for transactions performed pursuant to such an agency, And provided further, That the activities conducted pursuant to such an agency shall be limited to those activities otherwise permitted by this section.

(k) The credit union may not agree to accept or contract with the insurer for responsibility of the credit union for nontransmission of premiums nor may the credit union transmit business correspondence to its members for the insurer or trust or association described in paragraph (e) of this section such as notices of cancellation, bills, claim forms, etc.

(1) The credit union which passes informational material to its members as set forth in paragraph (c) of this section must indicate to its members in writing that the member must voluntarily determine whether he desires to participate in such insurance plan and when the member makes application for insurance about which the credit union has furnished informational material, he must indicate in writing on the application that he has voluntarily selected the insurer and understands that he may select any other insurer of his own choice. This provision, of course, does not apply where the credit union has purchased insurance such as life savings or loan protection insurance for all members. Nothing herein shall be construed as preventing a credit union from exercising a reasonable privilege of approval or disapproval of the insurance procured by the borrower on the property securing the indebtedness.

(m) The credit union may accept from the insurer or trust or association described in paragraph (e) of this section reimbursement for the actual cost of ministerial tasks performed pertaining to insurance. Any compensation, reimbursement, or other consideration in excess of such cost, whether in the form of merchandise, services, cash or otherwise, received or promised, directly or indirectly, to a credit union is prohibited.

(n) The credit union must, in carrying out any of the permitted practices, comply with the applicable insurance laws of the State in which the credit union does business. The guidelines herein are in addition to, and not in lieu of, any applicable laws and regulations of the State in which such insurance activities are transacted.

(0) No credit union shall, directly or indirectly, engage in any act, practice or transaction, with respect to the subject matter of these guidelines, nor enter into any contract of insurance, or agreement or understanding relating thereto, unless all parties to such act, practice, transaction or contract expressly agree in writing to be bound by the provisions hereof.

(p) No credit union shall, directly or indirectly, engage in any act, practice or transaction, otherwise permitted herein, where such act, practice or transaction shall constitute an evasion, or attempted evasion, of any requirement or prohibition of these guidelines, nor shall any credit union aid, abet or permit, directly or indirectly, any such evasion, or attempted evasion, by any insurer or other person dealing with any such credit union or its members.

[87 FR 19358, Sept. 20, 1972, as amended at 88 FR 3587, Feb. 8, 1973]

§ 721.2 Group purchasing activities other than insurance.

(a) A Federal credit union may inform its members as to the availability of various group purchasing plans which are related to the promotion of thrift or the borrowing of money for provident and productive purposes by means of informational materials placed in the credit union's office, through its publications, or by direct mailings to members by the credit union. The credit union may not, directly or indirectly, make any list of its membership available or provide addresses of its members to any party associated with such a plan or use the stationery or envelopes provided by those who operate such plans.

(b) A Federal credit union may not be a member of such group purchasing plans nor may it solicit members or participants for such plans. A Federal credit union and its officials, employees, agents, and representatives may not, directly or indirectly, act in any agency capacity in regard to such plans. For purposes of this section, the term "agency capacity" includes but is not limited to the preparation and transmittal of individual membership applications, issuance of membership certificates, explanation of benefits, and other related activities.

(c) A Federal credit union or its officials, employees, agents, and representatives may not, directly or indirectly, re

ceive compensation, reimbursement, or other consideration in excess of the actual cost of making such informational materials available to its members or for any other functions performed in connection with such plans, whether in the form of merchandise, services, cash or otherwise.

(d) A Federal credit union must, in carrying out any of the permitted practices, comply with the applicable laws of the State in which the credit union does business.

§ 721.3 Operational systems (temporary provisions).

(a) Credit unions, associations of credit unions, and any other parties interested in credit union programs may submit pilot programs relating to electronic funds transfer through remote service units, loan programs, and other operational systems to the Administration for evaluation and approval.

(b) A program will be designated a pilot program if it is determined that the implementation of the program will provide the Administration with the information necessary for the establishment of permanent programs which will effectively benefit all credit unions and the parties they serve.

(c) Where a pilot program is deemed appropriate and the submitting party is a Federal credit union, such Federal credit union will be designated the credit union to implement the pilot program, provided the Administration determines that the implementation by such Federal credit union would best serve the Administration's observation and evaluation of the actual operation of the pilot program. If the requesting Federal credit union is deemed unqualified for implementation, or if the submitting party is not a Federal credit union, the Administrator may, with the consent of the submitting party, designate an alternate Federal credit union to test the program.

(d) A termination date will be specified for the credit union designated to implement a pilot program. If, at the termination date, additional time is needed for complete evaluation, the Administrator may extend the time at the request of the designated credit union. The Administration reserves the right to terminate or otherwise modify any ongoing pilot program. At the end of the evaluation period or extensions thereof,

§ 722.1

Designated Federal employee.

(a) The Federal Advisory Committee Act requires that an officer or employee of the Federal Government be designated to chair or attend each meeting of the National Credit Union Board. In fulfillment of this requirement, the Administrator, or his designee shall attend each meeting of the National Credit Union Board.

(b) No meeting of the National Credit Union Board shall be held except at the call of or with the advance approval of the Administrator and no meeting of the National Credit Union Board shall be conducted in the absence of the Administrator or his designee.

(c) The Administrator or his designee may adjourn any meeting of the National Credit Union Board whenever he determines that such adjournment is in

the public interest such as in the event of an unwarranted departure from a meeting's agenda. The Administrator shall approve, in advance, the agenda for each meeting of the National Credit Union Board.

(d) The Chairman of the Board or the Administrator, or his designee, may request any attendee not a member of the Board who does not display the proper decorum as established in this part to leave the meeting and if such person refuses, the Chairman of the Board or the Administrator or his designee may order the removal of such person.

§ 722.2 Calling of meetings.

(a) Time. Notice of each meeting of the National Credit Union Board shall be published in the FEDERAL REGISTER at least 7 days prior to the commencement of such meeting except in emergency situations where shorter notice may be required. Normally, notice will be published approximately 25 days in advance of such meeting.

(b) Contents of notice. The notice required in paragraph (a) of this section shall contain the name of the National Credit Union Board, the time and place of the meeting, and the purpose of the meeting, including a general summary of the agenda items. The notice will also state whether there are any items on the agenda which will be closed to the public and the extent to which the public may participate in the meeting.

§ 722.3 Conduct of meetings.

(a) Agenda. Each meeting of the National Credit Union Board shall be conducted in accordance with an agenda which has been approved by the Administrator pursuant to § 722.1(c). The proposed agenda shall be submitted to the Administrator at least 35 days prior to the scheduled date of the meeting except in the case of an emergency meeting where a shorter time may be required. The agenda shall list the matters to be considered at the meeting and shall indicate whether any part of the meeting is concerned with matters which are within the exemptions of the Freedom of Information Act (5 U.S.C. 552(b)). Copies of the agenda shall ordinarily be distributed to members of the National Credit Union Board prior to the date of the meeting.

(b) Public participation. (1) Subject to the provisions of this section, each meeting of the National Credit Union Board shall be open to the public. Each meeting shall be held at a reasonable time and at a place reasonably accessible to the public and shall use facilities of reasonable size considering such factors as the number of members of the public who could be expected to attend the particular meeting, the number of persons who attended similar meetings in the past, and the resources and facilities available to the Administration. Members of the public attending such meeting shall conduct themselves in accordance with these regulations and with proper decorum or subject themselves to removal as set forth in § 722.1(d).

(2) Any member of the public may file a written statement with the National Credit Union Board, either before or after the meeting. Such statement shall become a part of the official record of that particular meeting. Statements may be filed with the Chairman, National Credit Union Board, National Credit Union Administration, Washington, D.C. 20456.

(3) To the extent that the time available for the meeting permits, interested persons may be permitted to present oral statements to the National Credit Union Board: Provided, That such persons obtain approval from the Chairman of the Board in advance of the date of the meeting: And provided further, That such oral statements are confined to items listed on the published agenda. Such statements will normally be limited to 10 minutes in duration. Such requests should be directed to the Chairman, National Credit Union Board, National Credit Union Administration, Washington, D.C. 20456.

(4) Subject to the limits of time and in the discretion of the Chairman of the Board, members of the public may, during the course of the meeting, submit written questions to the National Credit Union Board. Such questions shall be confined to items on the agenda and, in accordance with the aforementioned limitations, may be answered orally by the National Credit Union Board.

(c) Meetings closed to the public. (1) If a meeting (or portion thereof) will have the express purpose of discuss

ing an existing document which is within one of the exemptions set forth in 5 U.S.C. 552(b), the meeting (or portion thereof) may be closed to the public: Provided, That a meeting (or portion thereof) involving consideration of a document prepared by or for the National Credit Union Board and exempt only under exemption (5) of 5 U.S.C. 552(b) (concerning intra- and interagency memoranda and letters) may be closed only if the Administrator determines that it is essential to close such meeting (or portion thereof) to protect the free exchange of internal views and to avoid undue interference with the Administration or National Credit Union

Board operations.

(2) If a meeting (or portion thereof) will have the express purpose of discussing a matter which is within one of the exemptions set forth in 5 U.S.C. 552(b), other than exemption (5), the meeting (or portion thereof) may be closed to the public, even though no specific document is to be discussed.

(3) If a meeting (or portion thereof) will be such that neither paragraph (c) (1) nor paragraph (c) (2) of this section furnishes a basis for closing such meeting (or portion thereof), the meeting shall be open to the public unless such a meeting (or portion thereof) will consist of an exchange of opinions, and such discussion, if written, would fall within exemption (5) of 5 U.S.C. 552(b) and it is essential to close such meeting (or portion thereof) to protect the free exchange of internal views and to avoid undue interference with the Administration or National Credit Union Board operations.

(4) (1) When the National Credit Union Board seeks to have a meeting (or portion thereof) closed on the basis of 5 U.S.C. 552(b), the Board shall notify the Administrator in writing setting forth the reasons why the meeting (or portion thereof) should be closed. Such notification shall be submitted to the Administrator at least 35 days prior to the scheduled date of such meeting.

(ii) The Administrator may, upon receiving the proposed agenda pursuant to § 722.3(a), determine that the meeting (or portion thereof) shall be closed even though the National Credit Union Board has not so requested in accordance with paragraph (c) (4) (1) of this section:

Provided, That this determination is made pursuant to the standards set forth in paragraphs (c) (1), (2), and (3) of this section.

(iii) The determination of the Administrator made pursuant to paragraph (c) (4) (i) or (4) (ii) of this section shall be in writing and shall contain a brief statement of the reasons upon which the determination is based.

(5) The determination with respect to closing a meeting may be made, where appropriate, to a series of meetings but a determination to close a series of meetings does not remove the requirement that public notice be given regarding each meeting.

(6) If a meeting is to consider several separable matters, not all of which are within the exemption of 5 U.S.C. 552(b), only the portion of the meeting dealing with exempted matters (as contained in paragraphs (c) (1), (2), and (3) of this section) may be closed.

(7) When all or part of a meeting is to be closed, such fact shall be indicated in the public notice of the meeting and in the agenda. When only part of a meeting is to be closed, the agenda shall be arranged, whenever practicable, to facilitate attendance by the public at the open portion of the meeting.

(8) When a meeting (or portion thereof) is closed, members of the National Credit Union Board shall not disclose the matters discussed except to other members of the Board or Administration employees on a need-to-know basis.

(9) When a meeting (or portion thereof) is closed, the National Credit Union Board shall issue a report, at least annually, setting forth a summary of its activities and related matters which are informative to the public and is consistent with the policy of 5 U.S.C. 552(b).

(d) Minutes. Detailed minutes shall be kept of each meeting of the National Credit Union Board. The minutes shall include at least the following: The time and place of the meeting; a list of the Board members and Administration employees present; a complete summary of matters discussed and conclusions reached; copies of all reports received, issued, or approved by the Board; an explanation of the extent to which the meeting was open to the public; an explanation of the extent of public par

ticipation, including a list of members of the public who presented oral or written statements and an estimate of the number of members of the public who attended the meeting. The Chairman of the National Credit Union Board shall certify to the accuracy of the minutes.

§ 722.4 Access to records.

(a) Generally. Subject to the provisions of 5 U.S.C. 552, the records, reports, transcripts, minutes, appendices, working papers, drafts, studies, agenda, or other documents which were made available to or prepared for or by the National Credit Union Board shall be available for public inspection and copying at the National Credit Union Administration, Washington, D.C. 20456.

(b) Exemptions. Access to the items listed in paragraph (a) of this section is subject to the exemptions contained in 5 U.S.C. 552(b). When the only basis for denying access to a document is exemption (5) (concerning intra- and interagency memoranda and letters), access may not be denied unless the Administrator determines that such denial is essential to protect the free exchange of internal views and to avoid undue interference with the Administration or the National Credit Union Board operations.

(c) Meeting partially closed. With respect to any meeting, part of which was elosed to the public, access shall be permitted to records relating to the open portion of the meeting.

(d) Transcripts. In addition to detailed minutes required by § 722.3(d), each meeting of the National Credit Union Board will be recorded, either mechanically or by other appropriate means. Transcripts will not be made unless specifically requested and the actual cost of such transcription shall be paid by the person or persons making the request.

(e) Procedure for requesting access to records. Requests for inspection and copying records under this part shall be made in accordance with the provisions of Part 720 entitled "Disclosures of Official Records and Information" of this chapter. Such requests shall be directed to the National Credit Union Board management officer who shall be the assistant administrator for Administration.