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115th Congress   }                                     {       Report
                        HOUSE OF REPRESENTATIVES
 1st Session     }                                     {      115-443

======================================================================

 
    PROVIDING FOR CONSIDERATION OF THE BILL (H.R. 477) TO AMEND THE 
  SECURITIES EXCHANGE ACT OF 1934 TO EXEMPT FROM REGISTRATION BROKERS 
  PERFORMING SERVICES IN CONNECTION WITH THE TRANSFER OF OWNERSHIP OF 
 SMALLER PRIVATELY HELD COMPANIES; PROVIDING FOR CONSIDERATION OF THE 
BILL (H.R. 3971) TO AMEND THE TRUTH IN LENDING ACT AND THE REAL ESTATE 
   SETTLEMENT PROCEDURES ACT OF 1974 TO MODIFY THE REQUIREMENTS FOR 
COMMUNITY FINANCIAL INSTITUTIONS WITH RESPECT TO CERTAIN RULES RELATING 
     TO MORTGAGE LOANS, AND FOR OTHER PURPOSES; AND PROVIDING FOR 
 CONSIDERATION OF THE JOINT RESOLUTION (H.J. RES. 123) MAKING FURTHER 
 CONTINUING APPROPRIATIONS FOR FISCAL YEAR 2018, AND FOR OTHER PURPOSES

                                _______
                                

  December 6, 2017.--Referred to the House Calendar and ordered to be 
                                printed

                                _______
                                

   Mr. Woodall, from the Committee on Rules, submitted the following

                              R E P O R T

                       [To accompany H. Res. 647]

    The Committee on Rules, having had under consideration 
House Resolution 647, by a record vote of 8 to 4, report the 
same to the House with the recommendation that the resolution 
be adopted.

                SUMMARY OF PROVISIONS OF THE RESOLUTION

    The resolution provides for consideration of H.R. 477, the 
Small Business Mergers, Acquisitions, Sales, and Brokerage 
Simplification Act of 2017, under a structured rule. The 
resolution provides one hour of debate equally divided and 
controlled by the chair and ranking minority member of the 
Committee on Financial Services. The resolution waives all 
points of order against consideration of the bill. The 
resolution provides that an amendment in the nature of a 
substitute consisting of the text of Rules Committee Print 115-
43 shall be considered as adopted and the bill, as amended, 
shall be considered as read. The resolution waives all points 
of order against provisions in the bill, as amended. The 
resolution makes in order only the further amendment printed in 
part A of this report, if offered by the Member designated in 
this report, which shall be considered as read, shall be 
debatable for the time specified in this report equally divided 
and controlled by the proponent and an opponent, shall not be 
subject to amendment, and shall not be subject to a demand for 
division of the question. The resolution waives all points of 
order against the amendment printed in part A of this report. 
The resolution provides one motion to recommit with or without 
instructions.
    Section 2 of the resolution provides for consideration of 
H.R. 3971, the Community Institution Mortgage Relief Act of 
2017, under a structured rule. The resolution provides one hour 
of debate equally divided and controlled by the chair and 
ranking minority member of the Committee on Financial Services. 
The resolution waives all points of order against consideration 
of the bill. The resolution provides that an amendment in the 
nature of a substitute consisting of the text of Rules 
Committee Print 115-44 shall be considered as adopted and the 
bill, as amended, shall be considered as read. The resolution 
waives all points of order against provisions in the bill, as 
amended. The resolution makes in order only the further 
amendment printed in part B of this report, if offered by the 
Member designated in this report, which shall be considered as 
read, shall be debatable for the time specified in this report 
equally divided and controlled by the proponent and an 
opponent, shall not be subject to amendment, and shall not be 
subject to a demand for division of the question. The 
resolution waives all points of order against the amendment 
printed in part B of this report. The resolution provides for 
one motion to recommit with or without instructions.
    Section 3 of the resolution provides for consideration of 
H.J. Res. 123, Making further continuing appropriations for 
fiscal year 2018, and for other purposes, under a closed rule. 
The resolution provides one hour of debate equally divided and 
controlled by the chair and ranking minority member of the 
Committee on Appropriations. The resolution waives all points 
of order against consideration of the joint resolution. The 
resolution provides that the joint resolution shall be 
considered as read. The resolution waives all points of order 
against provisions in the joint resolution. The resolution 
provides one motion to recommit.

                         EXPLANATION OF WAIVERS

    Although the resolution waives all points of order against 
consideration of H.R. 477, the Committee is not aware of any 
points of order. The waiver is prophylactic in nature.
    Although the resolution waives all points of order against 
provisions in H.R. 477, as amended, the Committee is not aware 
of any points of order. The waiver is prophylactic in nature.
    Although the resolution waives all points of order against 
the amendment to H.R. 477 printed in part A of this report, the 
Committee is not aware of any points of order. The waiver is 
prophylactic in nature.
    Although the resolution waives all points of order against 
consideration of H.R. 3971, the Committee is not aware of any 
points of order. The waiver is prophylactic in nature.
    Although the resolution waives all points of order against 
provisions in H.R. 3971, as amended, the Committee is not aware 
of any points of order. The waiver is prophylactic in nature.
    Although the resolution waives all points of order against 
the amendment to H.R. 3971 printed in part B of this report, 
the Committee is not aware of any points of order. The waiver 
is prophylactic in nature.
    The waiver of all points of order against consideration of 
H.J. Res. 123 includes a waiver of the following:
           Section 302(f) of the Congressional Budget 
        Act, which prohibits consideration of legislation 
        providing new budget authority in excess of a 302(a) 
        allocation of such authority;
           Section 311 of the Congressional Budget Act, 
        which prohibits consideration of legislation that would 
        cause the level of total new budget authority for the 
        first fiscal year to be exceeded; and
           Section 314 of the Congressional Budget Act, 
        which prohibits the consideration of legislation that 
        provides budget authority for a fiscal year that 
        exceeds either of the discretionary statutory spending 
        limits.
    Although the resolution waives all points of order against 
provisions in H.J. Res. 123, the Committee is not aware of any 
points of order. The waiver is prophylactic in nature.

                            COMMITTEE VOTES

    The results of each record vote on an amendment or motion 
to report, together with the names of those voting for and 
against, are printed below:

Rules Committee record vote No. 160

    Motion by Mr. Polis to make in order and provide the 
appropriate waivers to amendment #1, offered by Rep. Polis (CO) 
and Rep. Gallego (AZ), which inserts the text of the Bears Ears 
National Monument Expansion Act, in order to protect the 
original acreage identified by the tribes as housing culturally 
sensitive artifacts and sacred land and allow 20 minutes of 
debate; and make in order and provide the necessary waivers to 
amendment #2, offered by Rep. Polis (CO), which inserts the 
text of the DREAM Act, allowing DACA beneficiaries to earn 
lawful permanent residence by completing education, work, or 
military requirements, ultimately providing a pathway to 
citizenship and allow 2 hours of debate. Defeated: 4-8

----------------------------------------------------------------------------------------------------------------
                Majority Members                      Vote               Minority Members               Vote
----------------------------------------------------------------------------------------------------------------
Mr. Cole........................................          Nay   Ms. Slaughter.....................          Yea
Mr. Woodall.....................................          Nay   Mr. McGovern......................          Yea
Mr. Burgess.....................................          Nay   Mr. Hastings of Florida...........          Yea
Mr. Collins.....................................  ............  Mr. Polis.........................          Yea
Mr. Byrne.......................................          Nay
Mr. Newhouse....................................          Nay
Mr. Buck........................................          Nay
Ms. Cheney......................................          Nay
Mr. Sessions, Chairman..........................          Nay
----------------------------------------------------------------------------------------------------------------

Rules Committee record vote No. 161

    Motion by Mr. Cole to report the rule. Adopted: 8-4

----------------------------------------------------------------------------------------------------------------
                Majority Members                      Vote               Minority Members               Vote
----------------------------------------------------------------------------------------------------------------
Mr. Cole........................................          Yea   Ms. Slaughter.....................          Nay
Mr. Woodall.....................................          Yea   Mr. McGovern......................          Nay
Mr. Burgess.....................................          Yea   Mr. Hastings of Florida...........          Nay
Mr. Collins.....................................  ............  Mr. Polis.........................          Nay
Mr. Byrne.......................................          Yea
Mr. Newhouse....................................          Yea
Mr. Buck........................................          Yea
Ms. Cheney......................................          Yea
Mr. Sessions, Chairman..........................          Yea
----------------------------------------------------------------------------------------------------------------

      SUMMARY OF THE AMENDMENT TO H.R. 477 IN PART A MADE IN ORDER

    1. Sherman (CA), Huizenga (MI): Makes several changes that 
provide additional protections for investors and small 
businesses, which will align the bill with a Securities and 
Exchange Commission no-action letter issued January 31, 2014. 
Specifically the amendment includes provisions that would 
prohibit passive buyers in the M&A; transaction, prohibit M&A; 
brokers from binding a party to a transfer of ownership, 
prohibit M&A; brokers from providing financing for the transfer, 
and require M&A; brokers that represent both the buyer and 
seller to disclose that to both parties and receive written 
consent. (10 minutes)

     SUMMARY OF THE AMENDMENT TO H.R. 3971 IN PART B MADE IN ORDER

    1. Sherman (CA): Lowers the amount of consolidated assets 
of a creditor eligible for the safe harbor from escrow 
requirements in the bill from $25,000,000,000 or less to 
$10,000,000,000 or less; lowers the number of loans that a 
mortgage servicer eligible for exemptions and adjustments from 
the Bureau can service annually from 30,000 or fewer mortgage 
loans to 20,000 or fewer mortgage loans. (10 minutes)

          PART A--TEXT OF AMENDMENT TO H.R. 477 MADE IN ORDER

 1. An Amendment To Be Offered by Representative Sherman of California 
               or His Designee, Debatable for 10 Minutes

  Page 2, line 18, strike ``public''.
  Page 2, line 19, insert before the period the following ``, 
other than a business combination related shell company''.
  Page 2, after line 19, insert the following:
                          (iv) Directly, or indirectly through 
                        any of its affiliates, provides 
                        financing related to the transfer of 
                        ownership of an eligible privately held 
                        company.
                          (v) Assists any party to obtain 
                        financing from an unaffiliated third 
                        party without--
                                  (I) complying with all other 
                                applicable laws in connection 
                                with such assistance, 
                                including, if applicable, 
                                Regulation T (12 C.F.R. 220 et 
                                seq.); and
                                  (II) disclosing any 
                                compensation in writing to the 
                                party.
                          (vi) Represents both the buyer and 
                        the seller in the same transaction 
                        without providing clear written 
                        disclosure as to the parties the broker 
                        represents and obtaining written 
                        consent from both parties to the joint 
                        representation.
                          (vii) Facilitates a transaction with 
                        a group of buyers formed with the 
                        assistance of the M&A; broker to acquire 
                        the eligible privately held company.
                          (viii) Engages in a transaction 
                        involving the transfer of ownership of 
                        an eligible privately held company to a 
                        passive buyer or group of passive 
                        buyers. For purposes of the preceding 
                        sentence, a buyer that is actively 
                        involved in managing the acquired 
                        company is not a passive buyer, 
                        regardless of whether such buyer is 
                        itself owned by passive beneficial 
                        owners.
                          (ix) Binds a party to a transfer of 
                        ownership of an eligible privately held 
                        company.
  Page 3, after line 16, insert the following (and redesignate 
subsequent clauses accordingly):
                          ``(i) Business combination related 
                        shell company.--The term `business 
                        combination related shell company' 
                        means a shell company that is formed by 
                        an entity that is not a shell company--
                                  ``(I) solely for the purpose 
                                of changing the corporate 
                                domicile of that entity solely 
                                within the United States; or
                                  ``(II) solely for the purpose 
                                of completing a business 
                                combination transaction (as 
                                defined under section 
                                230.165(f) of title 17, Code of 
                                Federal Regulations) among one 
                                or more entities other than the 
                                company itself, none of which 
                                is a shell company.''.
  Page 4, line 1, strike ``officer exercising'' and insert 
``corporate officer of a corporation or limited liability 
company, and exercises''.
  Page 4, line 4, strike ``20'' and insert ``25''.
  Page 4, line 7, strike ``20'' and insert ``25''.
  Page 4, line 12, strike ``20'' and insert ``25''.
  Page 5, after line 18, insert the following flush-left text: 
``For purposes of this subclause, the Commission may by rule 
modify the dollar figures if the Commission determines that 
such a modification is necessary or appropriate in the public 
interest or for the protection of investors.''.
  Page 7, strike lines 15 through 25 and insert the following:
                          ``(v) Shell company.--The term `shell 
                        company' means a company that at the 
                        time of a transaction with an eligible 
                        privately held company--
                                  ``(I) has no or nominal 
                                operations; and
                                  ``(II) has--''.
                              ----------                              


          PART B--TEXT OF AMENDMENT TO H.R. 3971 MADE IN ORDER

 1. An Amendment To Be Offered by Representative Sherman of California 
               or His Designee, Debatable for 10 Minutes

  Page 1, line 16, strike ``$25,000,000,000'' and insert 
``$10,000,000,000''.
  Page 2, line 20, strike ``30,000'' and insert ``20,000''.

                                  [all]