16 U.S.C. § 825d : US Code - Section 825D: Officials dealing in securities

Search 16 U.S.C. § 825d : US Code - Section 825D: Officials dealing in securities

(a) Benefits; making or declaring dividends out of capital account
It shall be unlawful for any officer or director of any public
utility to receive for his own benefit, directly or indirectly, any
money or thing of value in respect of the negotiation,
hypothecation, or sale by such public utility of any security
issued or to be issued by such public utility, or to share in any
of the proceeds thereof, or to participate in the making or paying
of any dividends of such public utility from any funds properly
included in capital account.
(b) Interlocking directorates
(1) In general
After 6 months from August 26, 1935, it shall be unlawful for
any person to hold the position of officer or director of more
than one public utility or to hold the position of officer or
director of a public utility and the position of officer or
director of any bank, trust company, banking association, or firm
that is authorized by law to underwrite or participate in the
marketing of securities of a public utility, or officer or
director of any company supplying electrical equipment to such
public utility, unless the holding of such positions shall have
been authorized by order of the Commission, upon due showing in
form and manner prescribed by the Commission, that neither public
nor private interests will be adversely affected thereby. The
Commission shall not grant any such authorization in respect of
such positions held on August 26, 1935, unless application for
such authorization is filed with the Commission within sixty days
after that date.
(2) Applicability
(A) In general
In the circumstances described in subparagraph (B), paragraph
(1) shall not apply to a person that holds or proposes to hold
the positions of -
(i) officer or director of a public utility; and
(ii) officer or director of a bank, trust company, banking
association, or firm authorized by law to underwrite or
participate in the marketing of securities of a public
utility.
(B) Circumstances
The circumstances described in this subparagraph are that -
(i) a person described in subparagraph (A) does not
participate in any deliberations or decisions of the public
utility regarding the selection of a bank, trust company,
banking association, or firm to underwrite or participate in
the marketing of securities of the public utility, if the
person serves as an officer or director of a bank, trust
company, banking association, or firm that is under
consideration in the deliberation process;
(ii) the bank, trust company, banking association, or firm
of which the person is an officer or director does not engage
in the underwriting of, or participate in the marketing of,
securities of the public utility of which the person holds
the position of officer or director;
(iii) the public utility for which the person serves or
proposes to serve as an officer or director selects
underwriters by competitive procedures; or
(iv) the issuance of securities of the public utility for
which the person serves or proposes to serve as an officer or
director has been approved by all Federal and State
regulatory agencies having jurisdiction over the issuance.
(c) Statement of prior positions; definitions
(1) On or before April 30 of each year, any person, who, during
the calendar year preceding the filing date under this subsection,
was an officer or director of a public utility and who held, during
such calendar year, the position of officer, director, partner,
appointee, or representative of any other entity listed in
paragraph (2) shall file with the Commission, in such form and
manner as the Commission shall by rule prescribe, a written
statement concerning such positions held by such person. Such
statement shall be available to the public.
(2) The entities listed for purposes of paragraph (1) are as
follows -
(A) any investment bank, bank holding company, foreign bank or
subsidiary thereof doing business in the United States, insurance
company, or any other organization primarily engaged in the
business of providing financial services or credit, a mutual
savings bank, or a savings and loan association;
(B) any company, firm, or organization which is authorized by
law to underwrite or participate in the marketing of securities
of a public utility;
(C) any company, firm, or organization which produces or
supplies electrical equipment or coal, natural gas, oil, nuclear
fuel, or other fuel, for the use of any public utility;
(D) any company, firm, or organization which during any one of
the 3 calendar years immediately preceding the filing date was
one of the 20 purchasers of electric energy which purchased (for
purposes other than for resale) one of the 20 largest annual
amounts of electric energy sold by such public utility (or by any
public utility which is part of the same holding company system)
during any one of such three calendar years;
(E) any entity referred to in subsection (b) of this section;
and
(F) any company, firm, or organization which is controlled by
any company, firm, or organization referred to in this paragraph.
On or before January 31 of each calendar year, each public utility
shall publish a list, pursuant to rules prescribed by the
Commission, of the purchasers to which subparagraph (D) applies,
for purposes of any filing under paragraph (1) of such calendar
year.
(3) For purposes of this subsection -
(A) The term "public utility" includes any company which is a
part of a holding company system which includes a registered
holding company, unless no company in such system is an electric
utility.
(B) The terms "holding company", "registered holding company",
and "holding company system" have the same meaning as when used
in the Public Utility Holding Company Act of 1935.(!1)