department of state
Office of the State Banking Commissioner
Notice of Proposed Adoption of a Regulation of the State Bank Commissioner
The State Bank Commissioner proposes to adopt new Regulation 904 (“Exceptions to Tying Restrictions”), which implements §929(f) of Title 5 of the Delaware Code by authorizing certain conduct as exceptions to the anti-tying restrictions of §929. These exceptions are in addition to those elsewhere in §929. The State Bank Commissioner would adopt the proposed new Regulation 904 on or after November 4, 2005. Other regulations issued by the State Bank Commissioner are not affected by these proposals. The State Bank Commissioner is issuing this regulation in accordance with Title 5 of the Delaware Code.
A copy of the proposed new regulation is published in the Delaware Register of Regulations. A copy is also on file in the Office of the State Bank Commissioner, 555 E. Loockerman Street, Suite 210, Dover, DE 19901 and is available for inspection during regular office hours. Copies are available upon request.
Interested parties are invited to comment or submit written suggestions, data, briefs or other materials to the Office of the State Bank Commissioner as to whether this proposed new regulation should be adopted, rejected or modified. Written materials submitted will be available for inspection at the above address. Comments must be received at or before the public hearing scheduled for November 4, 2005.
A public hearing on the proposed regulation will be held in the Office of the State Bank Commissioner, 555 E. Loockerman Street, Suite 210, Dover, DE 19901 on Friday, November 4, 2005 commencing at 10:00 a.m. This notice is issued pursuant to the requirements of Subchapter III of Chapter 11 and Chapter 101 of Title 29 of the Delaware Code.
904 Exceptions to Tying Restrictions
Effective Date: [Proposed]
1.0 Purpose. This Regulation authorizes certain conduct as exceptions to the anti-tying restrictions of Section 929 of the State Banking Code (5 Del.C. §929), pursuant to Section 929(f). These exceptions are in addition to those elsewhere in Section 929.
2.0 Exceptions to statute.
Subject to the limitations of paragraph 3.0 of this Regulation, a bank may:
2.1 Safe harbor for combined-balance discounts. Vary the consideration for any product or package of products based on a customer's maintaining a combined minimum balance in certain products specified by the bank (eligible products), if:
2.1.1 The bank offers deposits, and all such deposits are eligible products; and
2.1.2 Balances in deposits count at least as much as nondeposit products toward the minimum balance.
2.2 Safe harbor for foreign transactions. Engage in any transaction with a customer if that customer is:
2.2.1 A corporation, business, or other person (other than an individual) that:
184.108.40.206 Is incorporated, chartered, or otherwise organized outside the United States; and
220.127.116.11 Has its principal place of business outside the United States; or
2.2.2 An individual who is a citizen of a foreign country and is not resident in the United States.
3.0 Limitations on exceptions.
Any exception authorized pursuant to this Regulation shall terminate upon a finding by the Commissioner that the arrangement is resulting in anti-competitive practices. The eligibility of a bank to operate under any exception authorized pursuant to this Regulation shall terminate upon a finding by the Commissioner that its exercise of this authority is resulting in anti-competitive practices.