§ 6758. — Bylaws, rules, and disciplinary action.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 15USC6758]
TITLE 15--COMMERCE AND TRADE
CHAPTER 93--INSURANCE
SUBCHAPTER III--NATIONAL ASSOCIATION OF REGISTERED AGENTS AND BROKERS
Sec. 6758. Bylaws, rules, and disciplinary action
(a) Adoption and amendment of bylaws
(1) Copy required to be filed with the NAIC
The board of directors of the Association shall file with the
NAIC a copy of the proposed bylaws or any proposed amendment to the
bylaws, accompanied by a concise general statement of the basis and
purpose of such proposal.
(2) Effective date
Except as provided in paragraph (3), any proposed bylaw or
proposed amendment shall take effect--
(A) 30 days after the date of the filing of a copy with the
NAIC;
(B) upon such later date as the Association may designate;
or
(C) upon such earlier date as the NAIC may determine.
(3) Disapproval by the NAIC
Notwithstanding paragraph (2), a proposed bylaw or amendment
shall not take effect if, after public notice and opportunity to
participate in a public hearing--
(A) the NAIC disapproves such proposal as being contrary to
the public interest or contrary to the purposes of this
subchapter and provides notice to the Association setting forth
the reasons for such disapproval; or
(B) the NAIC finds that such proposal involves a matter of
such significant public interest that public comment should be
obtained, in which case it may, after notifying the Association
in writing of such finding, require that the procedures set
forth in subsection (b) of this section be followed with respect
to such proposal, in the same manner as if such proposed bylaw
change were a proposed rule change within the meaning of such
subsection.
(b) Adoption and amendment of rules
(1) Filing proposed regulations with the NAIC
(A) In general
The board of directors of the Association shall file with
the NAIC a copy of any proposed rule or any proposed amendment
to a rule of the Association which shall be accompanied by a
concise general statement of the basis and purpose of such
proposal.
(B) Other rules and amendments ineffective
No proposed rule or amendment shall take effect unless
approved by the NAIC or otherwise permitted in accordance with
this paragraph.
(2) Initial consideration by the NAIC
Not later than 35 days after the date of publication of notice
of filing of a proposal, or before the end of such longer period not
to exceed 90 days as the NAIC may designate after such date, if the
NAIC finds such longer period to be appropriate and sets forth its
reasons for so finding, or as to which the Association consents, the
NAIC shall--
(A) by order approve such proposed rule or amendment; or
(B) institute proceedings to determine whether such proposed
rule or amendment should be modified or disapproved.
(3) NAIC proceedings
(A) In general
Proceedings instituted by the NAIC with respect to a
proposed rule or amendment pursuant to paragraph (2) shall--
(i) include notice of the grounds for disapproval under
consideration;
(ii) provide opportunity for hearing; and
(iii) be concluded not later than 180 days after the
date of the Association's filing of such proposed rule or
amendment.
(B) Disposition of proposal
At the conclusion of any proceeding under subparagraph (A),
the NAIC shall, by order, approve or disapprove the proposed
rule or amendment.
(C) Extension of time for consideration
The NAIC may extend the time for concluding any proceeding
under subparagraph (A) for--
(i) not more than 60 days if the NAIC finds good cause
for such extension and sets forth its reasons for so
finding; or
(ii) such longer period as to which the Association
consents.
(4) Standards for review
(A) Grounds for approval
The NAIC shall approve a proposed rule or amendment if the
NAIC finds that the rule or amendment is in the public interest
and is consistent with the purposes of this Act.
(B) Approval before end of notice period
The NAIC shall not approve any proposed rule before the end
of the 30-day period beginning on the date on which the
Association files proposed rules or amendments in accordance
with paragraph (1), unless the NAIC finds good cause for so
doing and sets forth the reasons for so finding.
(5) Alternate procedure
(A) In general
Notwithstanding any provision of this subsection other than
subparagraph (B), a proposed rule or amendment relating to the
administration or organization of the Association shall take
effect--
(i) upon the date of filing with the NAIC, if such
proposed rule or amendment is designated by the Association
as relating solely to matters which the NAIC, consistent
with the public interest and the purposes of this
subsection, determines by rule do not require the procedures
set forth in this paragraph; or
(ii) upon such date as the NAIC shall for good cause
determine.
(B) Abrogation by the NAIC
(i) In general
At any time within 60 days after the date of filing of
any proposed rule or amendment under subparagraph (A)(i) or
clause (ii) of this subparagraph, the NAIC may repeal such
rule or amendment and require that the rule or amendment be
refiled and reviewed in accordance with this paragraph, if
the NAIC finds that such action is necessary or appropriate
in the public interest, for the protection of insurance
producers or policyholders, or otherwise in furtherance of
the purposes of this subchapter.
(ii) Effect of reconsideration by the NAIC
Any action of the NAIC pursuant to clause (i) shall--
(I) not affect the validity or force of a rule
change during the period such rule or amendment was in
effect; and
(II) not be considered to be a final action.
(c) Action required by the NAIC
The NAIC may, in accordance with such rules as the NAIC determines
to be necessary or appropriate to the public interest or to carry out
the purposes of this subchapter, require the Association to adopt,
amend, or repeal any bylaw, rule, or amendment of the Association,
whenever adopted.
(d) Disciplinary action by the Association
(1) Specification of charges
In any proceeding to determine whether membership shall be
denied, suspended, revoked, or not renewed (hereafter in this
section referred to as a ``disciplinary action''), the Association
shall bring specific charges, notify such member of such charges,
give the member an opportunity to defend against the charges, and
keep a record.
(2) Supporting statement
A determination to take disciplinary action shall be supported
by a statement setting forth--
(A) any act or practice in which such member has been found
to have been engaged;
(B) the specific provision of this subchapter, the rules or
regulations under this subchapter, or the rules of the
Association which any such act or practice is deemed to violate;
and
(C) the sanction imposed and the reason for such sanction.
(e) NAIC review of disciplinary action
(1) Notice to the NAIC
If the Association orders any disciplinary action, the
Association shall promptly notify the NAIC of such action.
(2) Review by the NAIC
Any disciplinary action taken by the Association shall be
subject to review by the NAIC--
(A) on the NAIC's own motion; or
(B) upon application by any person aggrieved by such action
if such application is filed with the NAIC not more than 30 days
after the later of--
(i) the date the notice was filed with the NAIC pursuant
to paragraph (1); or
(ii) the date the notice of the disciplinary action was
received by such aggrieved person.
(f) Effect of review
The filing of an application to the NAIC for review of a
disciplinary action, or the institution of review by the NAIC on the
NAIC's own motion, shall not operate as a stay of disciplinary action
unless the NAIC otherwise orders.
(g) Scope of review
(1) In general
In any proceeding to review such action, after notice and the
opportunity for hearing, the NAIC shall--
(A) determine whether the action should be taken;
(B) affirm, modify, or rescind the disciplinary sanction; or
(C) remand to the Association for further proceedings.
(2) Dismissal of review
The NAIC may dismiss a proceeding to review disciplinary action
if the NAIC finds that--
(A) the specific grounds on which the action is based exist
in fact;
(B) the action is in accordance with applicable rules and
regulations; and
(C) such rules and regulations are, and were, applied in a
manner consistent with the purposes of this subchapter.
(Pub. L. 106-102, title III, Sec. 328, Nov. 12, 1999, 113 Stat. 1427.)
References in Text
This Act, referred to in subsec. (b)(4)(A), is Pub. L. 106-102, Nov.
12, 1999, 113 Stat. 1338, known as the Gramm-Leach-Bliley Act. For
complete classification of this Act to the Code, see Short Title of 1999
Amendment note set out under section 1811 of Title 12, Banks and
Banking, and Tables.
Section Referred to in Other Sections
This section is referred to in sections 6760, 6762 of this title.
