Proposed Rules Federal Register Vol

63428 Proposed Rules Federal Register Vol. 81, No. 179 Thursday, September 15, 2016 This section of the FEDERAL REGISTER • Fax: (571) 465–4326. and Regulatory Activities Division, contains notices to the public of the proposed Instructions: You must include (202) 649–5490. issuance of rules and regulations. The ‘‘OCC’’ as the agency name and ‘‘Docket SUPPLEMENTARY INFORMATION: purpose of these notices is to give interested ID OCC–2016–0022’’ in your comment. persons an opportunity to participate in the In general, the OCC will enter all rule making prior to the adoption of the final I. Background rules. comments received into the docket and publish them on the Regulations.gov A national bank may engage in Web site without change, including any activities that are part of, or incidental DEPARTMENT OF THE TREASURY business or personal information that to, the business of banking under 12 you provide such as name and address U.S.C. 24(Seventh). Section 24(Seventh) Office of the Comptroller of the information, email addresses, or phone lists several activities that are part of the Currency numbers. Comments received, including business of banking; for example, it attachments and other supporting expressly provides that national banks 12 CFR Part 7 materials, are part of the public record may buy and sell exchange, coin, and and subject to public disclosure. Do not bullion. [Docket ID OCC–2016–0022] include any information in your In addition to these enumerated RIN 1557–AD93 comment or supporting materials that powers, section 24(Seventh) authorizes you consider confidential or Industrial and Commercial Metals national banks to exercise all such inappropriate for public disclosure. incidental powers as shall be necessary AGENCY: Office of the Comptroller of the You may review comments and other to carry on the business of banking. Currency (OCC), Treasury. related materials that pertain to this National banks also are authorized to rulemaking action by any of the ACTION: Notice of proposed rulemaking. engage in any other activities not following methods: • expressly enumerated in the statute that SUMMARY: The OCC is proposing to Viewing Comments Electronically: the Comptroller of the Currency prohibit national banks and federal Go to www.regulations.gov. Enter reasonably determines are part of the savings associations from dealing and ‘‘Docket ID OCC–2016–0022’’ in the business of banking.1 investing in industrial and commercial Search box and click ‘‘Search.’’ Click on 2 metal. ‘‘Open Docket Folder’’ on the right side In Interpretive Letter 693, issued approximately twenty years ago, the DATES: You must submit comments by of the screen and then ‘‘Comments.’’ OCC authorized national banks to buy November 14, 2016. Comments can be filtered by clicking on ‘‘View All’’ and then using the filtering and sell copper on the grounds that ADDRESSES: Because paper mail in the trading copper was becoming Washington, DC area and at the OCC is tools on the left side of the screen. • Click on the ‘‘Help’’ tab on the increasingly similar to trading gold, subject to delay, commenters are silver, platinum, and palladium. The encouraged to submit comments Regulations.gov home page to get information on using Regulations.gov. letter observed that copper was traded through the Federal eRulemaking Portal in liquid markets; that it was traded in or email, if possible. Please use the title Supporting materials may be viewed by clicking on ‘‘Open Docket Folder’’ and a form standardized as to weight and ‘‘Industrial and Commercial Metals’’ to purity; and that the bank seeking facilitate the organization and then clicking on ‘‘Supporting authority to engage in the activity traded distribution of the comments. You may Documents.’’ The docket may be viewed copper under policies and procedures submit comments by any of the after the close of the comment period in similar to those that governed trading following methods: the same manner as during the comment • period. precious metals. The letter concluded Federal eRulemaking Portal— • ‘‘Regulations.gov’’: Go to Viewing Comments Personally: You that national banks could buy and sell www.regulations.gov. Enter ‘‘Docket ID may personally inspect and photocopy copper under the express authority to OCC–2016–0022’’ in the Search Box and comments at the OCC, 400 7th Street buy and sell coin and bullion and as click ‘‘Search.’’ Click on ‘‘Comment SW., Washington, DC. For security part of or incidental to the business of Now’’ to submit public comments. reasons, the OCC requires that visitors banking. The scope of the authorization • Click on the ‘‘Help’’ tab on the make an appointment to inspect in Interpretive Letter 693 was Regulations.gov home page to get comments. You may do so by calling sufficiently broad to permit national information on using Regulations.gov, (202) 649–6700 or, for persons who are banks to buy and sell copper in the form including instructions for submitting deaf or hard of hearing, TTY, (202) 649– of cathodes, which are used for public comments. 5597. Upon arrival, visitors will be industrial purposes. • Email: regs.comments@ required to present valid government- In this notice of proposed rulemaking, occ.treas.gov. issued photo identification and submit the OCC proposes to prohibit national • Mail: Legislative and Regulatory to security screening in order to inspect banks from dealing and investing in a Activities Division, Office of the and photocopy comments. metal (or alloy), including copper, in a Comptroller of the Currency, 400 7th FOR FURTHER INFORMATION CONTACT: form primarily suited to industrial or Street SW., suite 3E–218, mail stop 9W– Casey Scott Laxton, Counsel, Beth commercial use (industrial or 11, Washington, DC 20219. Kirby, Assistant Director, or Ted Dowd, • Hand Delivery/Courier: 400 7th Director, Securities and Corporate 1 NationsBank of N.C., N.A. v. Var. Ann. Life. Ins. Street SW., Suite 3E–218, mail stop 9W– Practices Division, (202) 649–5510; Carl Co., (VALIC) 513 U.S. 251, 258–59 (1995). 11, Washington, DC 20219. Kaminski, Special Counsel, Legislative 2 1995 WL 788816 (Nov. 14, 1995). VerDate Sep<11>2014 14:41 Sep 14, 2016 Jkt 238001 PO 00000 Frm 00001 Fmt 4702 Sfmt 4702 E:\FR\FM\15SEP1.SGM 15SEP1 rmajette on DSK2TPTVN1PROD with PROPOSALS Federal Register / Vol. 81, No. 179 / Thursday, September 15, 2016 / Proposed Rules 63429 commercial metal).3 The proposal: (i) II. Description of the Proposed Rule position, the OCC noted that the London Platinum and Palladium Market had Excludes industrial and commercial A. Industrial or Commercial Metal Is linked platinum and palladium for metals from the terms ‘‘exchange,’’ Not ‘‘Exchange, Coin, and Bullion’’ ‘‘coin,’’ and ‘‘bullion’’ in 12 U.S.C. market making and regulatory purposes 24(Seventh); and (ii) provides that As noted above, the National Bank and that most of the Market’s members dealing or investing in them is not part Act authorizes national banks to buy were banks. and sell exchange, coin, and bullion. In of, or incidental to, the business of However, other interpretive letters this notice of proposed rulemaking, the banking. Examples of metals and alloys recognized that not every precious metal OCC is proposing to exclude from the is coin or bullion. Jewelry, the OCC in a form primarily suited for industrial scope of these terms metals in a form determined, is not.14 or commercial use include copper primarily suited to industrial or The OCC proposes to conclude that cathodes, aluminum T-bars, and gold commercial use. ‘‘exchange, coin, and bullion’’ does not jewelry. The OCC does not believe that Banking Circular 58 (BC–58) 8 sets encompass industrial or commercial dealing or investing in these metals is forth general guidelines that apply to metal. The OCC believes this conclusion appropriate for national banks. The national banks’ coin and bullion is consistent with the National Bank Act proposed rule would supersede activities. It defines ‘‘coin’’ as ‘‘coins and current market practice. For Interpretive Letter 693.4 held for their metallic value which are example, in the mid-19th century, when The proposed rule also applies to minted by a government, or exact Congress passed the National Bank Act, federal savings associations (FSA). The restrikes of such coins minted at a later ‘‘bullion’’ meant metal suitable for Home Owners’ Loan Act does not date by or under the authority of the coining, not metal suitable for making issuing government.’’ Contemporaneous 15 expressly authorize FSAs to buy or sell wires. The contemporary OCC interpretive letters elaborated that exchange, coin, and bullion.5 FSAs do understanding of ‘‘bullion’’ is broader— ‘‘coin’’ referred only to media of most currency is no longer made of have incidental authority to buy and sell exchange.9 BC–58 defines ‘‘bullion’’ as precious metal—but the contemporary precious metals in certain cases and to ‘‘uncoined gold or silver in bar or ingot understanding does distinguish bullion sell gold and silver coins minted by the form.’’ These definitions do not from industrial or commercial metal. 6 U.S. Treasury. However, the OCC is not encompass industrial or commercial For example, modern bullion markets aware of any precedent authorizing metal. trade precious metals by the kilogram.16 FSAs to buy and sell any industrial or Interpretive letters published after By contrast, industrial and commercial commercial metal. The OCC does not BC–58 interpreted national banks’ metals markets trade base metals in interpret FSAs’ incidental powers to authority to buy coin and bullion to quantities suitable for industrial or buy and sell metals to be broader than include other precious metals, namely commercial use.17 The following table those of national banks. To avoid doubt, platinum and palladium. Consistent illustrates trading differences between and to further integrate national bank with BC–58’s definition of ‘‘coin,’’ the bullion markets and industrial or and FSA regulations, the proposed rule OCC in 1987 found that legal tender commercial metal markets.

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