Financial Transparency Act of 2021

IIB 117TH CONGRESS 1ST SESSION H. R. 2989 IN THE SENATE OF THE UNITED STATES OCTOBER 26, 2021 Received; read twice and referred to the Committee on Banking, Housing, and Urban Affairs AN ACT To amend securities and banking laws to make the informa- tion reported to financial regulatory agencies electroni- cally searchable, to further enable the development of RegTech and Artificial Intelligence applications, to put the United States on a path towards building a com- prehensive Standard Business Reporting program to ulti- mately harmonize and reduce the private sector’s regu- latory compliance burden, while enhancing transparency and accountability, and for other purposes. VerDate Sep 11 2014 23:22 Oct 26, 2021 Jkt 029200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6652 E:\BILLS\H2989.RFS H2989 kjohnson on DSK79L0C42PROD with BILLS 2 HR 2989 RFS Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 3 (a) SHORT TITLE.—This Act may be cited as the 4 ‘‘Financial Transparency Act of 2021’’. 5 (b) TABLE OF CONTENTS.—The table of contents for 6 this Act is as follows: 7 Sec. 1. Short title; table of contents. TITLE I—DEPARTMENT OF THE TREASURY Sec. 101. Data standards. Sec. 102. Open data publication by the Department of the Treasury. Sec. 103. Rulemaking. Sec. 104. No new disclosure requirements. Sec. 105. Report. TITLE II—SECURITIES AND EXCHANGE COMMISSION Sec. 201. Data standards requirements for the Securities and Exchange Com- mission. Sec. 202. Open data publication by the Securities and Exchange Commission. Sec. 203. Data transparency at the Municipal Securities Rulemaking Board. Sec. 204. Data transparency at national securities associations. Sec. 205. Shorter-term burden reduction and disclosure simplification at the Securities and Exchange Commission; sunset. Sec. 206. No new disclosure requirements. TITLE III—FEDERAL DEPOSIT INSURANCE CORPORATION Sec. 301. Data standards requirements for the Federal Deposit Insurance Cor- poration. Sec. 302. Open data publication by the Federal Deposit Insurance Corporation. Sec. 303. Rulemaking. Sec. 304. No new disclosure requirements. TITLE IV—OFFICE OF THE COMPTROLLER OF THE CURRENCY Sec. 401. Data standards and open data publication requirements for the Office of the Comptroller of the Currency. Sec. 402. Rulemaking. Sec. 403. No new disclosure requirements. TITLE V—BUREAU OF CONSUMER FINANCIAL PROTECTION Sec. 501. Data standards and open data publication requirements for the Bu- reau of Consumer Financial Protection. Sec. 502. Rulemaking. Sec. 503. No new disclosure requirements. VerDate Sep 11 2014 23:22 Oct 26, 2021 Jkt 029200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6211 E:\BILLS\H2989.RFS H2989 kjohnson on DSK79L0C42PROD with BILLS 3 HR 2989 RFS TITLE VI—FEDERAL RESERVE SYSTEM Sec. 601. Data standards requirements for the Board of Governors of the Fed- eral Reserve System. Sec. 602. Open data publication by the Board of Governors of the Federal Re- serve System. Sec. 603. Rulemaking. Sec. 604. No new disclosure requirements. TITLE VII—NATIONAL CREDIT UNION ADMINISTRATION Sec. 701. Data standards. Sec. 702. Open data publication by the National Credit Union Administration. Sec. 703. Rulemaking. Sec. 704. No new disclosure requirements. TITLE VIII—FEDERAL HOUSING FINANCE AGENCY Sec. 801. Data standards requirements for the Federal Housing Finance Agen- cy. Sec. 802. Open data publication by the Federal Housing Finance Agency. Sec. 803. Rulemaking. Sec. 804. No new disclosure requirements. TITLE IX—MISCELLANEOUS Sec. 901. Rules of construction. Sec. 902. Classified and protected information. Sec. 903. Discretionary surplus fund. Sec. 904. Determination of budgetary effects. TITLE I—DEPARTMENT OF THE 1 TREASURY 2 SEC. 101. DATA STANDARDS. 3 (a) IN GENERAL.—Subtitle A of title I of the Finan- 4 cial Stability Act of 2010 (12 U.S.C. 5311 et seq.) is 5 amended by adding at the end the following: 6 ‘‘SEC. 124. DATA STANDARDS. 7 ‘‘(a) IN GENERAL.—The Secretary of the Treasury 8 shall, by rule, promulgate data standards, meaning a 9 standard that specifies rules by which data is described 10 and recorded, for the information reported to member 11 agencies by financial entities under the jurisdiction of the 12 VerDate Sep 11 2014 23:22 Oct 26, 2021 Jkt 029200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2989.RFS H2989 kjohnson on DSK79L0C42PROD with BILLS 4 HR 2989 RFS member agency and the data collected from member agen- 1 cies on behalf of the Council. 2 ‘‘(b) STANDARDIZATION.—Member agencies, in con- 3 sultation with the Secretary of the Treasury, shall imple- 4 ment regulations promulgated by the Secretary of the 5 Treasury under subsection (a) to standardize data re- 6 ported to member agencies or collected on behalf of the 7 Council, as described under subsection (a). 8 ‘‘(c) DATA STANDARDS.— 9 ‘‘(1) COMMON IDENTIFIERS.—The data stand- 10 ards promulgated under subsection (a) shall include 11 common identifiers for information reported to mem- 12 ber agencies or collected on behalf of the Council. 13 The common identifiers shall include a common non- 14 proprietary legal entity identifier that is available 15 under an open license (as defined under section 16 3502 of title 44, United States Code) for all entities 17 required to report to member agencies. 18 ‘‘(2) DATA STANDARD.—The data standards 19 promulgated under subsection (a) shall, to the extent 20 practicable— 21 ‘‘(A) render data fully searchable and ma- 22 chine-readable (as defined under section 3502 23 of title 44, United States Code); 24 VerDate Sep 11 2014 23:22 Oct 26, 2021 Jkt 029200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H2989.RFS H2989 kjohnson on DSK79L0C42PROD with BILLS 5 HR 2989 RFS ‘‘(B) enable high quality data through 1 schemas, with accompanying metadata (as de- 2 fined under section 3502 of title 44, United 3 States Code) documented in machine-readable 4 taxonomy or ontology models, which clearly de- 5 fine the data’s semantic meaning as defined by 6 the underlying regulatory information collection 7 requirements; 8 ‘‘(C) assure that a data element or data 9 asset that exists to satisfy an underlying regu- 10 latory information collection requirement be 11 consistently identified as such in associated ma- 12 chine-readable metadata; 13 ‘‘(D) be nonproprietary or made available 14 under an open license; 15 ‘‘(E) incorporate standards developed and 16 maintained by voluntary consensus standards 17 bodies; and 18 ‘‘(F) use, be consistent with, and imple- 19 ment applicable accounting and reporting prin- 20 ciples. 21 ‘‘(3) CONSULTATION.—In promulgating data 22 standards under subsection (a), the Secretary of the 23 Treasury shall consult with the member agencies 24 and with other Federal departments and agencies 25 VerDate Sep 11 2014 23:22 Oct 26, 2021 Jkt 029200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H2989.RFS H2989 kjohnson on DSK79L0C42PROD with BILLS 6 HR 2989 RFS and multi-agency initiatives responsible for Federal 1 data standards. 2 ‘‘(4) INTEROPERABILITY OF DATA.—In promul- 3 gating data standards under subsection (a), the Sec- 4 retary of the Treasury shall seek to promote inter- 5 operability of financial regulatory data across mem- 6 bers of the Council. 7 ‘‘(d) MEMBER AGENCIES DEFINED.—In this section, 8 the term ‘member agencies’ does not include the Com- 9 modity Futures Trading Commission.’’. 10 (b) CLERICAL AMENDMENT.—The table of contents 11 under section 1(b) of the Dodd-Frank Wall Street Reform 12 and Consumer Protection Act is amended by inserting 13 after the item relating to section 123 the following: 14 ‘‘Sec. 124. Data standards.’’. SEC. 102. OPEN DATA PUBLICATION BY THE DEPARTMENT 15 OF THE TREASURY. 16 Section 124 of the Financial Stability Act of 2010, 17 as added by section 101, is amended by adding at the end 18 the following: 19 ‘‘(e) OPEN DATA PUBLICATION.—All public informa- 20 tion published by the Secretary of the Treasury under this 21 subtitle shall be made available as an open Government 22 data asset (as defined under section 3502 of title 44, 23 United States Code), freely available for download in bulk, 24 and rendered in a human-readable format and accessible 25 VerDate Sep 11 2014 23:22 Oct 26, 2021 Jkt 029200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H2989.RFS H2989 kjohnson on DSK79L0C42PROD with BILLS 7 HR 2989 RFS via application programming interface where appro- 1 priate.’’. 2 SEC. 103. RULEMAKING. 3 Not later than the end of the 2-year period beginning 4 on the date of the enactment of this Act, the Secretary 5 of the Treasury shall issue the regulations required under 6 the amendments made by this title. The Secretary may 7 delegate the functions required under the amendments 8 made by this title to an appropriate office within the De- 9 partment of the Treasury. 10 SEC. 104. NO NEW DISCLOSURE REQUIREMENTS. 11 Nothing in this title or the amendments made by this 12 title shall be construed to require the Secretary of the 13 Treasury to collect or make publicly available additional 14 information under the statutes amended by this title, be- 15 yond information that was collected or made publicly avail- 16 able under such statutes before the date of the enactment 17 of this Act. 18 SEC. 105. REPORT. 19 Not later than 1 year after the end of the 2-year pe- 20 riod described in section 103, the Comptroller General of 21 the United States shall submit to Congress a report on 22 the feasibility, costs, and potential benefits of building 23 upon the taxonomy established by this Act to arrive at 24 a Federal Government-wide regulatory compliance stand- 25 VerDate Sep 11 2014 23:22 Oct 26, 2021 Jkt 029200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H2989.RFS H2989 kjohnson on DSK79L0C42PROD with BILLS 8 HR 2989 RFS ardization mechanism similar to Standard Business Re- 1 porting. 2 TITLE II—SECURITIES AND 3 EXCHANGE COMMISSION 4 SEC. 201. DATA STANDARDS REQUIREMENTS FOR THE SE- 5 CURITIES AND EXCHANGE COMMISSION. 6 (a) DATA STANDARDS FOR INVESTMENT ADVISERS’ 7 REPORTS UNDER THE INVESTMENT ADVISERS ACT OF 8 1940.—Section 204 of the Investment Advisers Act of 9 1940 (15 U.S.C. 80b–4) is amended— 10 (1) by redesignating the second subsection (d) 11 (relating to Records of Persons With Custody of 12 Use) as subsection (e); and 13 (2) by adding at the end the following: 14 ‘‘(f) DATA STANDARDS FOR REPORTS FILED UNDER 15 THIS SECTION.— 16 ‘‘(1) REQUIREMENT.—The Commission shall, 17 by rule, adopt data standards for all reports filed by 18 investment advisers with the Commission under this 19 section. 20 ‘‘(2) CHARACTERISTICS.—The data standards 21 required by paragraph (1) shall, to the extent prac- 22 ticable— 23 VerDate Sep 11 2014 23:22 Oct 26, 2021 Jkt 029200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H2989.RFS H2989 kjohnson on DSK79L0C42PROD with BILLS 9 HR 2989 RFS ‘‘(A) render data fully searchable and ma- 1 chine-readable (as defined under section 3502 2 of title 44, United States Code); 3 ‘‘(B) enable high quality data through 4 schemas, with accompanying metadata (as de- 5 fined under section 3502 of title 44, United 6 States Code) documented in machine-readable 7 taxonomy or ontology models, which clearly de- 8 fine the data’s semantic meaning as defined by 9 the underlying regulatory information collection 10 requirements; 11 ‘‘(C) assure that a data element or data 12 asset that exists to satisfy an underlying regu- 13 latory information collection requirement be 14 consistently identified as such in associated ma- 15 chine-readable metadata; 16 ‘‘(D) be nonproprietary or made available 17 under an open license (as defined under section 18 3502 of title 44, United States Code); 19 ‘‘(E) incorporate standards developed and 20 maintained by voluntary consensus standards 21 bodies; and 22 ‘‘(F) use, be consistent with, and imple- 23 ment applicable accounting and reporting prin- 24 ciples. 25 VerDate Sep 11 2014 23:22 Oct 26, 2021 Jkt 029200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H2989.RFS H2989 kjohnson on DSK79L0C42PROD with BILLS 10 HR 2989 RFS ‘‘(3) INCORPORATION OF STANDARDS.—In 1 adopting data standards by rule under this sub- 2 section, the Commission shall incorporate all applica- 3 ble data standards promulgated by the Secretary of 4 the Treasury.’’. 5 (b) DATA STANDARDS FOR REGISTRATION STATE- 6 MENTS AND REPORTS UNDER THE INVESTMENT COM- 7 PANY ACT OF 1940.—The Investment Company Act of 8 1940 (15 U.S.C. 80a–1 et seq.) is amended— 9 (1) in section 8, by adding at the end the fol- 10 lowing: 11 ‘‘(g) DATA STANDARDS FOR REGISTRATION STATE- 12 MENTS.— 13 ‘‘(1) REQUIREMENT.—The Commission shall, 14 by rule, adopt data standards for all registration 15 statements required to be filed with the Commission 16 under this section, except that the Commission may 17 exempt exhibits, signatures, and certifications from 18 such data standards. 19 ‘‘(2) CHARACTERISTICS.—The data standards 20 required by paragraph (1) shall, to the extent prac- 21 ticable— 22 ‘‘(A) render data fully searchable and ma- 23 chine-readable (as defined under section 3502 24 of title 44, United States Code); 25 VerDate Sep 11 2014 23:22 Oct 26, 2021 Jkt 029200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H2989.RFS H2989 kjohnson on DSK79L0C42PROD with BILLS 11 HR 2989 RFS ‘‘(B) enable high quality data through 1 schemas, with accompanying metadata (as de- 2 fined under section 3502 of title 44, United 3 States Code) documented in machine-readable 4 taxonomy or ontology models, which clearly de- 5 fine the data’s semantic meaning as defined by 6 the underlying regulatory information collection 7 requirements; 8 ‘‘(C) assure that a data element or data 9 asset that exists to satisfy an underlying regu- 10 latory information collection requirement be 11 consistently identified as such in associated ma- 12 chine-readable metadata; 13 ‘‘(D) be nonproprietary or made available 14 under an open license (as defined under section 15 3502 of title 44, United States Code); 16 ‘‘(E) incorporate standards developed and 17 maintained by voluntary consensus standards 18 bodies; and 19 ‘‘(F) use, be consistent with, and imple- 20 ment applicable accounting and reporting prin- 21 ciples. 22 ‘‘(3) INCORPORATION OF STANDARDS.—In 23 adopting data standards by rule under this sub- 24 section, the Commission shall incorporate all applica- 25 VerDate Sep 11 2014 23:22 Oct 26, 2021 Jkt 029200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H2989.RFS H2989 kjohnson on DSK79L0C42PROD with BILLS 12 HR 2989 RFS ble data standards promulgated by the Secretary of 1 the Treasury.’’; and 2 (2) in section 30, by adding at the end the fol [Text truncated for display. Full text available on Congress.gov.]