Full Text of HB0744 095th General Assembly
HB0744enr 95TH GENERAL ASSEMBLY
|
|
|
HB0744 Enrolled |
|
LRB095 04298 MJR 24339 b |
|
| 1 |
| AN ACT concerning regulation.
| 2 |
| Be it enacted by the People of the State of Illinois,
| 3 |
| represented in the General Assembly:
| 4 |
| Section 5. The Illinois Banking Act is amended by changing | 5 |
| Section 35.2 as follows:
| 6 |
| (205 ILCS 5/35.2) (from Ch. 17, par. 345)
| 7 |
| Sec. 35.2. Limitations on investments in and loans to | 8 |
| affiliates.
| 9 |
| (a) Restrictions on transactions with affiliates.
| 10 |
| (1) A state bank and
its subsidiaries may engage in a | 11 |
| covered transaction with an affiliate,
as expressly | 12 |
| provided in this Section 35.2, only if:
| 13 |
| (A) in the case of any one affiliate, the aggregate | 14 |
| amount of covered
transactions of the state bank and | 15 |
| its subsidiaries will not exceed 10%
of the unimpaired | 16 |
| capital and unimpaired surplus of the state bank; and
| 17 |
| (B) in the case of all affiliates, the aggregate | 18 |
| amount of covered
transactions of the state bank and | 19 |
| its subsidiaries will not exceed 20% of
the unimpaired | 20 |
| capital and unimpaired surplus of the state bank.
| 21 |
| (2) For the purpose of this Section, any transactions | 22 |
| by a state bank
with any person shall be deemed to be a | 23 |
| transaction with an affiliate to
the extent that the |
|
|
|
HB0744 Enrolled |
- 2 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| proceeds of the transaction are used for the benefit
of, or | 2 |
| transferred to, that affiliate.
| 3 |
| (3) A state bank and its subsidiaries may not purchase | 4 |
| a low-quality asset
from an affiliate unless the bank or | 5 |
| such subsidiary, pursuant to an
independent credit | 6 |
| evaluation, committed itself to purchase such asset
prior | 7 |
| to the time such asset was acquired by the affiliate.
| 8 |
| (4) Any covered transactions and any transactions | 9 |
| exempt under subsection
(d) between a state bank and an | 10 |
| affiliate shall be on terms and conditions
that are | 11 |
| consistent with safe and sound banking practices.
| 12 |
| (b) Definitions. For the purpose of this Section, the | 13 |
| following rules
and definitions apply:
| 14 |
| (1) "Affiliate" with respect to a state bank means
| 15 |
| (A) any company that controls the state bank and | 16 |
| any other company that
is controlled by the company | 17 |
| that controls the state bank;
| 18 |
| (B) a bank subsidiary of the state bank;
| 19 |
| (C) any company
| 20 |
| (i) controlled directly or indirectly, by a | 21 |
| trust or otherwise, by
or for the benefit of | 22 |
| shareholders who beneficially or otherwise | 23 |
| control,
directly or indirectly, by trust or | 24 |
| otherwise, the state bank or any
company
that | 25 |
| controls the state
bank; or
| 26 |
| (ii) a majority of the directors or trustees of |
|
|
|
HB0744 Enrolled |
- 3 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| which constitute a
majority
of the persons holding | 2 |
| any such office with the state bank or any company
| 3 |
| that controls the state bank;
| 4 |
| (D) (i) any company, including a real estate | 5 |
| investment trust, that is
sponsored and advised on | 6 |
| a contractual basis by the state bank or any
| 7 |
| subsidiary or affiliate of the state bank; or
| 8 |
| (ii) any investment company with respect to | 9 |
| which a state bank or any
affiliate thereof is an | 10 |
| investment advisor. An investment advisor is | 11 |
| defined
as "any person (other than a bona fide | 12 |
| officer, director, trustee, member
of an advisory | 13 |
| board, or employee of such company, as such) who | 14 |
| pursuant
to contract with such company regularly | 15 |
| furnishes advice to such company,
with respect to | 16 |
| the desirability or investing in, purchasing, or | 17 |
| selling
securities or other property shall be | 18 |
| purchased or sold by such company,
and any other | 19 |
| who pursuant to contract with a person as described | 20 |
| above
regularly performs substantially all of the | 21 |
| duties undertaken by such person
described above; | 22 |
| but does not include a person whose advice is | 23 |
| furnished
solely through uniform publications to | 24 |
| subscribers thereto or a person who
furnishes only | 25 |
| statistical and other factual information, advice | 26 |
| regarding
economic factors and trends, or advice |
|
|
|
HB0744 Enrolled |
- 4 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| as to occasional transactions in
specific | 2 |
| securities, but without generally furnishing | 3 |
| advice or making
recommendations regarding the | 4 |
| purchase or sale of securities, or a company
| 5 |
| furnishing such services at cost to one or more | 6 |
| investment companies,
insurance companies or other | 7 |
| financial institutions, or any person the
| 8 |
| character and amount of whose compensation for | 9 |
| such services must be approved
by a court.
| 10 |
| (E) any company the Commissioner determines as | 11 |
| having a relationship
with
the state bank or any | 12 |
| subsidiary or affiliate of the state bank, such that
| 13 |
| covered transactions by the state bank or its | 14 |
| subsidiary with the company
may be affected by the | 15 |
| relationship to the detriment of the state bank or
its | 16 |
| subsidiary.
| 17 |
| (2) None of the following are considered to be an | 18 |
| affiliate:
| 19 |
| (A) any company, other than a bank, that is a | 20 |
| subsidiary of a state
bank,
unless a determination is | 21 |
| made under subparagraph (E) of paragraph (1) not
to | 22 |
| exclude such subsidiary company from the definition of | 23 |
| affiliate;
| 24 |
| (B) any company engaged solely in holding the | 25 |
| premises of the state
bank;
| 26 |
| (C) any company engaged solely in conducting a safe |
|
|
|
HB0744 Enrolled |
- 5 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| deposit business;
| 2 |
| (D) any company engaged solely in holding | 3 |
| obligations of the United
States
or its agencies or | 4 |
| obligations fully guaranteed by the United States or
| 5 |
| its agencies as to principal and interest; and
| 6 |
| (E) any company where control results from the | 7 |
| exercise of rights
arising
out of a bona fide debt | 8 |
| previously contracted, but only for the period of
time | 9 |
| specifically authorized under applicable State and | 10 |
| federal law or
regulations or, in the absence of such | 11 |
| law or regulation, for a period of 2
years from the | 12 |
| date of the exercise of such rights or the effective | 13 |
| date of
this Act, whichever date is later, subject, | 14 |
| upon application, to
authorization by the Commissioner | 15 |
| for good cause shown of extensions of
time for not more | 16 |
| than one year at a time, with such extensions not to
| 17 |
| exceed an aggregate of 3 years.
| 18 |
| (3) (A) A company or shareholder has control over | 19 |
| another company if
| 20 |
| (i) such company or shareholder, directly or | 21 |
| indirectly, or acting
through
one or more other | 22 |
| persons, owns, controls, or has power to vote 25% | 23 |
| or more
of any class of voting securities of the | 24 |
| other company;
| 25 |
| (ii) such company or shareholder controls in | 26 |
| any manner the election
of a majority of the |
|
|
|
HB0744 Enrolled |
- 6 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| directors or trustees of the other company; or
| 2 |
| (iii) the Commissioner determines, after | 3 |
| notice and opportunity for
hearing, that such | 4 |
| company or shareholder, directly or indirectly,
| 5 |
| exercises a controlling influence over the | 6 |
| management or policies of the
other company.
| 7 |
| (B) Notwithstanding any other provisions of this | 8 |
| Section, no company
shall be deemed to own or control | 9 |
| another company by virtue of its
ownership or control | 10 |
| of shares in a fiduciary capacity, except as provided
| 11 |
| in subparagraph (C) of paragraph (1) or because of its | 12 |
| ownership or control
of such shares in a business | 13 |
| trust.
| 14 |
| (4) "Subsidiary" with respect to a specified company | 15 |
| means a company that
is controlled by such specified | 16 |
| company.
| 17 |
| (5) "Bank" means any bank now or hereafter organized | 18 |
| under the laws of
any State or territory of the United | 19 |
| States including the District of Columbia,
any national | 20 |
| bank, and any trust company.
| 21 |
| (6) "Company" means a corporation, partnership, | 22 |
| business trust,
association,
or similar organization and, | 23 |
| unless specifically excluded, includes a "state
bank" and a | 24 |
| "bank".
| 25 |
| (7) "Covered transaction" means, with respect to an | 26 |
| affiliate of a
state bank,
|
|
|
|
HB0744 Enrolled |
- 7 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| (A) a loan or extension of credit to the affiliate;
| 2 |
| (B) a purchase of or an investment in securities | 3 |
| issued by the
affiliate;
| 4 |
| (C) a purchase of assets, including assets subject | 5 |
| to an agreement to
repurchase, from the affiliate, | 6 |
| except such purchases of real and personal
property as | 7 |
| may be specifically exempted by the Commissioner;
| 8 |
| (D) the acceptance of securities issued by the | 9 |
| affiliate as collateral
security for a loan or | 10 |
| extension of credit to any person or company; or
| 11 |
| (E) the issuance of a guarantee, acceptance, or | 12 |
| letter of credit,
including
an endorsement or standby | 13 |
| letter of credit, on behalf of an affiliate.
| 14 |
| (8) "Aggregate amount of covered transactions" means | 15 |
| the amount of
covered transactions about to be engaged in | 16 |
| added to the current amount of
all outstanding covered | 17 |
| transactions.
| 18 |
| (9) "Securities" means stocks, bonds, debentures, | 19 |
| notes or other similar
obligations.
| 20 |
| (10) "Low-quality asset" means an asset that falls into | 21 |
| any one or more
of the following categories:
| 22 |
| (A) an asset classified as "substandard", | 23 |
| "doubtful", or "loss" or
treated
as "other loans | 24 |
| especially mentioned" in the most recent report of | 25 |
| examination
of an affiliate;
| 26 |
| (B) an asset in a nonaccrual status;
|
|
|
|
HB0744 Enrolled |
- 8 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| (C) an asset on which principal or interest | 2 |
| payments are more than 30
days past due; or
| 3 |
| (D) an asset whose terms have been renegotiated or | 4 |
| compromised due to
the deteriorating financial | 5 |
| condition of the obligor.
| 6 |
| (c) Collateral for certain transactions with affiliates.
| 7 |
| (1) Each loan
or extension of credit to, or guarantee, | 8 |
| acceptance or letter of credit
issued on behalf of, an | 9 |
| affiliate by a state bank or its subsidiary shall
be | 10 |
| secured at the time of the transaction by collateral having | 11 |
| a market value
equal to
| 12 |
| (A) 100% of the amount of such loan or extension of | 13 |
| credit, guarantee,
acceptance, or letter of credit, if | 14 |
| the collateral is composed of
| 15 |
| (i) obligations of the United States or its | 16 |
| agencies;
| 17 |
| (ii) obligations fully guaranteed by the | 18 |
| United States or its agencies
as to principal and | 19 |
| interest;
| 20 |
| (iii) notes, drafts, bills of exchange or | 21 |
| bankers' acceptances that
are
eligible for | 22 |
| rediscount or purchase by a Federal Reserve Bank; | 23 |
| or
| 24 |
| (iv) a segregated, earmarked deposit account | 25 |
| with the state bank;
| 26 |
| (B) 110% of the amount of such loan or extension of |
|
|
|
HB0744 Enrolled |
- 9 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| credit, guarantee,
acceptance or letter of credit if | 2 |
| the collateral is composed of obligations
of any state | 3 |
| or political subdivision of any State;
| 4 |
| (C) 120% of the amount of such loan or extension of | 5 |
| credit, guarantee,
acceptance, or letter of credit if | 6 |
| the collateral is composed of other debt
instruments, | 7 |
| including receivables; and
| 8 |
| (D) 130% of the amount of such loan or extension of | 9 |
| credit, guarantee,
acceptance or letter of credit if | 10 |
| the collateral is composed of stock, leases,
or other | 11 |
| real or personal property.
| 12 |
| (2) Any such collateral that is subsequently retired or | 13 |
| amortized shall
be replaced by additional eligible | 14 |
| collateral where needed to keep the
percentage of the | 15 |
| collateral value relative to the amount of the
outstanding | 16 |
| loan or extension of credit, guarantee, acceptance, or | 17 |
| letter
of credit equal to the minimum percentage required | 18 |
| at the inception of the
transaction.
| 19 |
| (3) A low-quality asset shall not be acceptable as | 20 |
| collateral for a loan
or extension of credit to, or | 21 |
| guarantee, acceptance, or letter of credit
issued on behalf | 22 |
| of, an affiliate.
| 23 |
| (4) The securities issued by an affiliate of the state | 24 |
| bank shall not
be acceptable as collateral for a loan or | 25 |
| extension of credit to, or guarantee,
acceptance or letter | 26 |
| of credit issued on behalf of, that affiliate or any
other |
|
|
|
HB0744 Enrolled |
- 10 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| affiliate of the state bank.
| 2 |
| (5) The collateral requirements of this paragraph do | 3 |
| not apply to an
acceptance that is already fully secured | 4 |
| either by attached documents or by
other property having an | 5 |
| ascertainable market value that is involved in the
| 6 |
| transaction.
| 7 |
| (d) Exemptions. The provisions of this Section, except | 8 |
| paragraph (4) of
subsection (a), shall not be applicable to
the | 9 |
| following as to which there shall be no limitation:
| 10 |
| (1) any transaction, subject to the prohibition | 11 |
| contained in paragraph
(3) of subsection (a), with a bank
| 12 |
| (A) which controls 80% or more of the voting shares | 13 |
| of the state bank;
| 14 |
| (B) in which the state bank controls 80% or more of | 15 |
| the voting shares;
or
| 16 |
| (C) in which 80% or more of the voting shares are | 17 |
| controlled by the
company
that controls 80% or more of | 18 |
| the voting shares of the state bank;
| 19 |
| (2) making deposits in an affiliated bank or affiliated | 20 |
| foreign bank in
the ordinary course of correspondent | 21 |
| business, subject to any restrictions
that the | 22 |
| Commissioner may prescribe;
| 23 |
| (3) giving immediate credit to an affiliate for | 24 |
| uncollected items received
in the ordinary course of | 25 |
| business;
| 26 |
| (4) making a loan or extension of credit to, or issuing |
|
|
|
HB0744 Enrolled |
- 11 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| a guarantee,
acceptance, or letter of credit on behalf of, | 2 |
| an affiliate that is fully
secured by
| 3 |
| (A) obligations of the United States or its | 4 |
| agencies;
| 5 |
| (B) obligations fully guaranteed by the United | 6 |
| States or its agencies
as to principal and interest; or
| 7 |
| (C) a segregated, earmarked deposit account with | 8 |
| the state bank;
| 9 |
| (5) purchasing securities issued by any company of the | 10 |
| kinds described
as follows:
| 11 |
| Shares of any company engaged or to be engaged solely | 12 |
| in one or more of
the following activities: holding or | 13 |
| operating properties used wholly or
substantially by any | 14 |
| banking subsidiary of such bank holding company in
the | 15 |
| operations of such banking subsidiary or acquired for such | 16 |
| future use;
or conducting a safe deposit business; or | 17 |
| furnishing services to or
performing services for such bank | 18 |
| holding company or its banking
subsidiaries; or | 19 |
| liquidating assets acquired from such bank holding company
| 20 |
| or its banking subsidiaries or acquired from any other | 21 |
| source prior to May
9, 1956, or the date on which such | 22 |
| company became a bank holding company,
whichever is later;
| 23 |
| (6) purchasing assets having a readily identifiable | 24 |
| and publicly available
market quotation and purchased at | 25 |
| the market quotation or, subject to the
prohibition | 26 |
| contained in paragraph (3) of subsection (a), purchasing |
|
|
|
HB0744 Enrolled |
- 12 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| loans
on a nonrecourse basis from affiliated banks; and
| 2 |
| (7) purchasing from an affiliate a loan or extension of | 3 |
| credit that was
originated by the state bank and sold to | 4 |
| the affiliate subject to a repurchase
agreement or with | 5 |
| recourse.
| 6 |
| (e) Notwithstanding the provisions of this Section, a state | 7 |
| bank and its subsidiaries in compliance with the provisions of | 8 |
| Regulation W [12 C.F.R. Part 223] promulgated by the Board of | 9 |
| Governors of the Federal Reserve, as amended from time to time, | 10 |
| shall be deemed to be in compliance with this Section.
| 11 |
| This Section shall apply to any transaction entered into | 12 |
| after January
1, 1984, except for transactions which are the | 13 |
| subject of a binding written
contract or commitment entered | 14 |
| into on or before July 28, 1982, and except
that any renewal of | 15 |
| a participation in a loan outstanding on July 28, 1982,
to a | 16 |
| company that becomes an affiliate as a result of the enactment | 17 |
| of this
Act, or any participation in a loan to such an | 18 |
| affiliate emanating from the
renewal of a binding written | 19 |
| contract or commitment outstanding on July 28,
1982, shall not | 20 |
| be subject to the collateral requirements of this Act.
| 21 |
| (Source: P.A. 88-546; 89-364, eff. 8-18-95.)
| 22 |
| Section 10. The Banking Emergencies Act is amended by | 23 |
| changing Section 2 as follows:
| 24 |
| (205 ILCS 610/2) (from Ch. 17, par. 1002)
|
|
|
|
HB0744 Enrolled |
- 13 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| Sec. 2. Power of Commissioner. | 2 |
| (a) Whenever the Commissioner is notified by any officer of | 3 |
| a bank or by any
other means becomes aware that an
emergency | 4 |
| exists, or is impending, he may, by proclamation, authorize all | 5 |
| banks in the State
of Illinois to close any or all of their | 6 |
| offices, or if only a
bank or banks, or offices thereof, in a | 7 |
| particular
area or areas of the State of Illinois are affected | 8 |
| by the emergency or
impending
emergency, the Commissioner may | 9 |
| authorize only the affected bank, banks, or
offices thereof, to | 10 |
| close. The office or offices so closed may remain closed
until
| 11 |
| the Commissioner declares, by further proclamation, that the | 12 |
| emergency or
impending emergency has ended. The
Commissioner | 13 |
| during an emergency or while an impending emergency exists,
| 14 |
| which affects, or may affect, a particular bank or banks, or a | 15 |
| particular
office or offices thereof, but not banks located in | 16 |
| the area generally of
the said county or municipality, may | 17 |
| authorize the particular bank or
banks, or office or offices so | 18 |
| affected, to close. The office or offices so
closed shall | 19 |
| remain closed until the Commissioner is notified by a bank
| 20 |
| officer of the closed bank that the emergency has ended. The | 21 |
| Commissioner
shall notify, at such time, the officers of the | 22 |
| bank that one or more
offices, heretofore closed because of the | 23 |
| emergency, should reopen and, in
either event, for such further | 24 |
| time thereafter as may reasonably be
required to reopen.
| 25 |
| (b) Whenever the Commissioner becomes aware that an | 26 |
| emergency exists, or is impending, he or she may, by |
|
|
|
HB0744 Enrolled |
- 14 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| proclamation, authorize any bank organized under the laws of | 2 |
| another state, or of the United States, to open and operate | 3 |
| offices in this State, notwithstanding any other laws of this | 4 |
| State to the contrary. Any office or offices opened in | 5 |
| accordance with this subsection may remain open until the | 6 |
| Commissioner declares, by further proclamation, that the | 7 |
| emergency or impending emergency has ended. The Department of | 8 |
| Financial and Professional Regulation shall adopt rules to | 9 |
| implement this subsection (b).
| 10 |
| (Source: P.A. 92-483, eff. 8-23-01.)
| 11 |
| Section 15. The Financial Institutions Electronic | 12 |
| Documents and Digital Signature Act is amended by changing | 13 |
| Sections 5 and 10 as follows:
| 14 |
| (205 ILCS 705/5)
| 15 |
| Sec. 5. Definitions. As used in this Act:
| 16 |
| "Digital signature" means an encrypted
electronic | 17 |
| identifier, created by computer, intended by the party using it | 18 |
| to
have the same force and effect as the use of a manual | 19 |
| signature.
| 20 |
| "Financial institution" means a bank,
a savings
and loan | 21 |
| association, a savings bank, or
a credit
union or any | 22 |
| subsidiary or affiliate of a bank, savings and loan | 23 |
| association, savings bank, or credit union .
| 24 |
| "Substitute check" means a paper reproduction of an |
|
|
|
HB0744 Enrolled |
- 15 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| original check, as defined in the Check Clearing for the 21st | 2 |
| Century Act (12 U.S.C. 5001, et seq.), as amended from time to | 3 |
| time, and the rules promulgated thereunder.
| 4 |
| (Source: P.A. 94-458, eff. 8-4-05.)
| 5 |
| (205 ILCS 705/10)
| 6 |
| Sec. 10. Electronic documents; digital signatures ; | 7 |
| electronic notices .
| 8 |
| (a) Electronic documents. If in the regular course of | 9 |
| business, a financial institution possesses,
records, or | 10 |
| generates any document, representation, image, substitute | 11 |
| check, reproduction, or
combination thereof, of any agreement, | 12 |
| transaction, act, occurrence, or event
by any electronic or | 13 |
| computer-generated process that accurately reproduces,
| 14 |
| comprises, or records the agreement, transaction, act, | 15 |
| occurrence, or event,
the recording, comprising, or | 16 |
| reproduction shall have the same force and effect under the | 17 |
| laws of this State
as one comprised, recorded, or created on | 18 |
| paper or other tangible form by
writing, typing, printing, or | 19 |
| similar means.
| 20 |
| (b) Digital signatures. In any communication, | 21 |
| acknowledgement, agreement, or contract between a
financial | 22 |
| institution and its customer, in which a signature is required | 23 |
| or
used, any party to the communication, acknowledgement, | 24 |
| agreement, or contract
may affix a signature by use of a | 25 |
| digital signature, and the digital signature,
when lawfully |
|
|
|
HB0744 Enrolled |
- 16 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| used by the person whose signature it purports to be,
shall | 2 |
| have the same force and effect as the use of a manual signature | 3 |
| if it is
unique to the person using it, is capable of | 4 |
| verification, is under the sole
control of the person using it, | 5 |
| and is linked to data in such a manner that if
the data are | 6 |
| changed, the digital signature is invalidated. Nothing in this
| 7 |
| Section shall require any financial institution or customer to | 8 |
| use or permit
the use of a digital signature.
| 9 |
| (c) Electronic notices. | 10 |
| (1) Consent to electronic records. If a statute, | 11 |
| regulation, or other rule of law requires that information | 12 |
| relating to a transaction or transactions in or affecting | 13 |
| intrastate commerce in this State be provided or made | 14 |
| available by a financial institution to a consumer in | 15 |
| writing, the use of an electronic record to provide or make | 16 |
| available that information satisfies the requirement that | 17 |
| the information be in writing if: | 18 |
| (A) the consumer has affirmatively consented to | 19 |
| the use of an electronic record to provide or make | 20 |
| available that information and has not withdrawn | 21 |
| consent; | 22 |
| (B) the consumer, prior to consenting, is provided | 23 |
| with a clear and conspicuous statement: | 24 |
| (i) informing the consumer of: | 25 |
| (I) any right or option of the consumer to | 26 |
| have the record provided or made available on |
|
|
|
HB0744 Enrolled |
- 17 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| paper or in nonelectronic form, and | 2 |
| (II) the right of the consumer to withdraw | 3 |
| the consent to have the record provided or made | 4 |
| available in an electronic form and of any | 5 |
| conditions, consequences (which may include | 6 |
| termination of the parties' relationship), or | 7 |
| fees in the event of a withdrawal of consent; | 8 |
| (ii) informing the consumer of whether the | 9 |
| consent applies: | 10 |
| (I) only to the particular transaction | 11 |
| that gave rise to the obligation to provide the | 12 |
| record, or | 13 |
| (II) to identified categories of records | 14 |
| that may be provided or made available during | 15 |
| the course of the parties' relationship; | 16 |
| (iii) describing the procedures the consumer | 17 |
| must use to withdraw consent, as provided in clause | 18 |
| (i), and to update information needed to contact | 19 |
| the consumer electronically; and | 20 |
| (iv) informing the consumer: | 21 |
| (I) how, after the consent, the consumer | 22 |
| may, upon request, obtain a paper copy of an | 23 |
| electronic record, and | 24 |
| (II) whether any fee will be charged for a | 25 |
| paper copy; | 26 |
| (C) the consumer: |
|
|
|
HB0744 Enrolled |
- 18 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| (i) prior to consenting, is provided with a | 2 |
| statement of the hardware and software | 3 |
| requirements for access to and retention of the | 4 |
| electronic records; and | 5 |
| (ii) consents electronically, or confirms his | 6 |
| or her consent electronically, in a manner that | 7 |
| reasonably demonstrates that the consumer can | 8 |
| access information in the electronic form that | 9 |
| will be used to provide the information that is the | 10 |
| subject of the consent;
and | 11 |
| (D) after the consent of a consumer in accordance | 12 |
| with subparagraph (A), if a change in the hardware or | 13 |
| software requirements needed to access or retain | 14 |
| electronic records creates a material risk that the | 15 |
| consumer will not be able to access or retain a | 16 |
| subsequent electronic record that was the subject of | 17 |
| the consent, the person providing the electronic | 18 |
| record: | 19 |
| (i) provides the consumer with a statement of: | 20 |
| (I) the revised hardware and software | 21 |
| requirements for access to and retention of the | 22 |
| electronic records, and | 23 |
| (II) the right to withdraw consent without | 24 |
| the imposition of any fees for the withdrawal | 25 |
| and without the imposition of any condition or | 26 |
| consequence that was not disclosed under |
|
|
|
HB0744 Enrolled |
- 19 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| subparagraph (B)(i); and | 2 |
| (ii) again complies with subparagraph (C). | 3 |
| (2) Other rights. | 4 |
| (A) Preservation of consumer protections. Nothing | 5 |
| in this subsection (c) affects the content or timing of | 6 |
| any disclosure or other record required to be provided | 7 |
| or made available to any consumer under any statute, | 8 |
| regulation, or other rule of law. | 9 |
| (B) Verification or acknowledgment. If a law that | 10 |
| was enacted prior to this amendatory Act of the 95th | 11 |
| General Assembly expressly requires a record to be | 12 |
| provided or made available by a specified method that | 13 |
| requires verification or acknowledgment of receipt, | 14 |
| the record may be provided or made available | 15 |
| electronically only if the method used provides the | 16 |
| required verification or acknowledgment of receipt. | 17 |
| (3) Effect of failure to obtain electronic consent or | 18 |
| confirmation of consent. The legal effectiveness, | 19 |
| validity, or enforceability of any contract executed by a | 20 |
| consumer shall not be denied solely because of the failure | 21 |
| to obtain electronic consent or confirmation of consent by | 22 |
| that consumer in accordance with paragraph (1)(C)(ii). | 23 |
| (4) Prospective effect. Withdrawal of consent by a | 24 |
| consumer shall not affect the legal effectiveness, | 25 |
| validity, or enforceability of electronic records provided | 26 |
| or made available to that consumer in accordance with |
|
|
|
HB0744 Enrolled |
- 20 - |
LRB095 04298 MJR 24339 b |
|
| 1 |
| paragraph (1) prior to implementation of the consumer's | 2 |
| withdrawal of consent. A consumer's withdrawal of consent | 3 |
| shall be effective within a reasonable period of time after | 4 |
| receipt of the withdrawal by the provider of the record. | 5 |
| Failure to comply with paragraph (1)(D) may, at the | 6 |
| election of the consumer, be treated as a withdrawal of | 7 |
| consent for purposes of this paragraph. | 8 |
| (5) Prior consent. This subsection does not apply to | 9 |
| any records that are provided or made available to a | 10 |
| consumer who has consented prior to the effective date of | 11 |
| this amendatory Act of the 95th General Assembly to receive | 12 |
| the records in electronic form as permitted by any statute, | 13 |
| regulation, or other rule of law. | 14 |
| (6) Oral communications. An oral communication or a | 15 |
| recording of an oral communication shall not qualify as an | 16 |
| electronic record for purposes of this subsection (c), | 17 |
| except as otherwise provided under applicable law.
| 18 |
| (Source: P.A. 94-458, eff. 8-4-05.)
| 19 |
| Section 99. Effective date. This Act takes effect upon | 20 |
| becoming law.
|
|