Chapter 377 Oregon Laws 2001
AN ACT
SB 269
Relating to the regulation
of financial activities; creating new provisions; amending ORS 59.015, 59.840,
98.412, 192.502, 205.460, 294.035, 310.651, 646.382, 656.268, 706.005, 706.008,
706.015, 706.690, 706.720, 706.723, 706.730, 707.262, 708A.120, 708A.200,
708A.565, 715.012, 715.017, 715.019, 715.045, 715.055, 715.075, 715.090,
717.210, 722.419, 731.264, 731.312, 731.450, 731.735, 731.750, 731.752,
732.230, 732.523, 732.528, 732.548, 732.586, 733.304, 733.620, 735.425,
735.430, 744.061, 744.346, 744.724, 746.182, 746.185, 746.600, 746.620,
746.630, 746.665, 746.680, 748.603, 750.055, 803.092 and 803.220; repealing ORS
731.740 and section 45, chapter 191, Oregon Laws 2001 (Enrolled Senate Bill
268); and declaring an emergency.
Be It Enacted by the People of the State of Oregon:
SECTION 1.
Sections 2 and 3 of this 2001 Act are
added to and made a part of ORS chapter 705.
SECTION 2.
(1) Except as provided in subsection (3)
of this section, any document, material or other information that is in the
possession or control of the Department of Consumer and Business Services for
the purpose of administering ORS 646.380 to 646.396, 697.005 to 697.095,
697.602 to 697.842, 717.200 to 717.320, 717.900 and 717.905, ORS chapters 59,
722, 723, 725 and 726, the Bank Act and the Insurance Code and that is
described in statute as confidential or as not subject to disclosure is not
subject to disclosure under ORS 192.410 to 192.505, is not subject to subpoena
and is not subject to discovery or admissible in evidence in any private civil
action. The Director of the Department of Consumer and Business Services may
use such confidential documents, materials or other information in
administering ORS 646.380 to 646.396, 697.005 to 697.095, 697.602 to 697.842,
717.200 to 717.320, 717.900 and 717.905, ORS chapters 59, 722, 723, 725 and
726, the Bank Act and the Insurance Code and in the furtherance of any other
regulatory or legal action brought as a part of the director’s duties.
(2) Any document,
material or other information to which subsection (1) of this section applies
is subject to the public officer privilege described in ORS 40.270.
(3) In order to assist
in the performance of the director’s duties, the director:
(a) May authorize the
sharing of confidential documents, materials and other information subject to
subsection (1) of this section as appropriate among the administrative
divisions and staff offices of the department created under ORS 705.115 for the
purpose of administering and enforcing the statutes referred to in subsection
(1) of this section, in order to enable the administrative divisions and staff
offices to carry out their functions and responsibilities.
(b) May share documents,
materials and other information, including the confidential documents,
materials and other information that is subject to subsection (1) of this
section or that is otherwise confidential under ORS 192.501 or 192.502, with
other state, federal, foreign and international regulatory and law enforcement
agencies and with the National Association of Insurance Commissioners and its
affiliates or subsidiaries, if the recipient agrees to maintain the
confidentiality of the documents, materials and other information.
(c) May receive
documents, materials and other information, including otherwise confidential
documents, materials and other information, from state, federal, foreign and
international regulatory and law enforcement agencies and from the National
Association of Insurance Commissioners and its affiliates or subsidiaries. The
director shall maintain as confidential as provided in this section any such
document, material or other information received upon notice or with an
understanding that it is confidential or privileged under the laws of the
jurisdiction that is the source of the document, material or other information.
(4) Neither disclosure
of documents, materials or other information to the director under this section
nor the sharing of documents, materials or other information as authorized in
subsection (3) of this section waives any applicable privilege or claim of
confidentiality in the documents, materials or other information.
(5) This section does
not prohibit the director from releasing final, adjudicated actions, including
suspensions or revocations of certificates of authority or licenses, when the
actions are otherwise open to public inspection, to a database or other
clearinghouse service maintained by the National Association of Insurance
Commissioners or its affiliates or subsidiaries.
SECTION 3.
(1) The Director of the Department of
Consumer and Business Services may enter into agreements with other state,
federal, foreign and international regulatory and law enforcement agencies and
with the National Association of Insurance Commissioners and its affiliates or
subsidiaries, governing the sharing and use of information consistent with
section 2 of this 2001 Act.
(2) An agreement under
this section must specify the duration of the agreement, the purpose of the
agreement, the methods that may be employed for terminating the agreement and
any other necessary and proper matters.
(3) An agreement under
this section does not relieve the director of any obligation or responsibility
imposed by law.
(4) The director may expend
funds of the Department of Consumer and Business Services and may supply
services for the purpose of carrying out an agreement under this section.
(5) Agreements under
this section are exempt from ORS 190.410 to 190.440 and 190.480 to 190.490.
SECTION 4.
ORS 731.264 is amended to read:
731.264. (1) A complaint made to the Director of the
Department of Consumer and Business Services against any person regulated by
the Insurance Code, and the record thereof, shall be confidential[,] and [shall] may not be
disclosed except as [considered necessary
by the director in the administration of the Insurance Code] provided in section 2 of this 2001 Act.
No such complaint, or the record thereof, shall be used in any action, suit or
proceeding except to the extent considered necessary by the director in the
prosecution of apparent violations of the Insurance Code or other law.
(2) Data gathered pursuant to an investigation by the
director of a complaint shall be confidential, [and shall] may not be
disclosed [or] except as provided in section 2 of this 2001 Act and may not be
used in any action, suit or proceeding except to the extent considered
necessary by the director in the investigation or prosecution of apparent
violations of the Insurance Code or
other law.
(3) Notwithstanding subsections (1) and (2) of this
section, the director shall establish by rule a method for publishing an annual
statistical report containing the insurer’s name and the number, percentage,
type and disposition of complaints received by the Department of Consumer and
Business Services against each insurer transacting insurance within this state.
SECTION 5.
ORS 731.312 is amended to read:
731.312. (1) Not later than the 60th day after completion
of an examination, the examiner in charge of the examination shall submit to
the Director of the Department of Consumer and Business Services a full and
true report of the examination, verified by the oath of the examiner. The
report shall comprise only facts appearing upon the books, papers, records,
accounts, documents or computer and other recordings of the person, its agents
or other persons being examined or facts ascertained from testimony of
individuals [under oath] concerning
the affairs of such person, together with such conclusions and recommendations
as reasonably may be warranted from such facts.
(2) The director shall make a copy of the report submitted
under subsection (1) of this section available to the person who is the subject
of the examination and shall give the person an opportunity to review and
comment on the report. The director may request additional information or meet
with the person for the purpose of resolving questions or obtaining additional
information, and may direct the examiner to consider the additional information
for inclusion in the report.
(3) Before the director files the examination report as a
final examination report or makes the report or any matters relating thereto
public, the person being examined shall have an opportunity for a hearing. A
copy of the report must be mailed by certified mail to the person being
examined. The person may request a hearing not later than the 30th day after
the date on which the report was mailed. This subsection does not limit the
authority of the director to disclose a preliminary or final examination report
as otherwise provided in this section.
(4) The director shall consider comments presented at a
hearing requested under subsection (3) of this section and may direct the
examiner to consider the comments or direct that the comments be included in
documentation relating to the report, although not as part of the report
itself. The director may file the report as a final examination report at any
time after consideration of the comments or at any time after the period for
requesting a hearing has passed if a hearing is not requested.
(5) A report filed as a final examination report is subject
to public inspection. The director, after filing any report, if the director
considers it for the interest of the public to do so, may publish any report or
the result of any examination as contained therein in one or more newspapers of
the state without expense to the person examined.
(6) [Except as
provided in subsections (7) and (8) of this section, or unless, in the sole
discretion of the director,] All
work papers, recorded information, documents and copies thereof that are
produced or obtained by or disclosed to the director or any other person in the
course of an examination or in the course of analysis by the director of the
financial condition or market conduct of an insurer are confidential and are
exempt from public inspection as provided in section 2 of this 2001 Act. If
the director, in the director’s sole
discretion, determines that disclosure is necessary to protect the public
interest, the director may make
available [all] work papers,
recorded information, documents and copies thereof produced by, obtained by or
disclosed to the director or any other person in the course of the examination
[are confidential and are exempt from
public inspection].
[(7) In the
furtherance of any judicial or administrative action, the director may use and
disclose any facts determined and conclusions made pursuant to an examination,
including but not limited to disclosure of any final examination report, any
preliminary examination report not otherwise disclosed to the public, any work
papers, recorded information, documents and copies thereof described in
subsection (6) of this section and any other information discovered or
developed during the course of the examination.]
[(8)] (7) The director may disclose the
content of an examination report that has not yet otherwise been disclosed or
may disclose any of the materials described in subsection (6) of this section as provided in section 2 of this 2001 Act.
[to any entity described in this
subsection if the entity, prior to receiving the report or materials, agrees in
writing to hold the report or materials confidential and in a manner consistent
with this section. This subsection does not require the director to disclose
any information or records revealing the existence or content of any
investigation by or activity of a criminal justice agency. The entities to whom
a report or other materials may be disclosed are as follows:]
[(a) The insurance
department of any other state or country.]
[(b) Law enforcement
officials of this or any other state or agency of the federal government.]
[(c) The National
Association of Insurance Commissioners.]
SECTION 6.
ORS 731.735 is amended to read:
731.735. [Neither the
Director of the Department of Consumer and Business Services nor any employee
of the Department of Consumer and Business Services may disclose] All financial analysis ratios and
examination synopses concerning insurers that are submitted to the Director of the Department of Consumer and Business
Services by the Insurance Regulatory Information System of the National
Association of Insurance Commissioners
are confidential as provided in section 2 of this 2001 Act.
SECTION 7.
ORS 731.750 is amended to read:
731.750. (1) A report filed with the Director of the
Department of Consumer and Business Services according to requirements
established by rule for disclosure of material acquisitions or dispositions of
assets and disclosure of material nonrenewals, cancellations and revisions of
ceded reinsurance agreements shall be confidential as provided in [this] section 2 of this 2001 Act.
(2) The director may direct the insurer to furnish copies
of a report described in subsection (1) of this section to the National
Association of Insurance Commissioners.
(3) [Except as
provided in this subsection, a report described in subsection (1) of this
section shall not be disclosed by the director or the National Association of
Insurance Commissioners.] The director may disclose or use a report as
considered necessary by the director in the administration of the Insurance
Code or other law.
[(4) A report
described in subsection (1) of this section shall not be subject to subpoena
and shall not be used in any action or proceeding except to the extent
considered necessary by the director in the administration of the Insurance
Code.]
[(5)] (4) Information contained in documents
described in subsections (1) to (3) of this section that is also contained in
financial statements of insurers filed under ORS 731.574 or in final
examination reports filed under ORS 731.312 is not confidential under this
section.
SECTION 8.
ORS 731.752 is amended to read:
731.752. (1) A report filed with the Director of the Department
of Consumer and Business Services according to requirements established by rule
for the purpose of determining the amount of capital or surplus, or any
combination thereof, that should be possessed and maintained by an insurer
under ORS 731.554 or by a health care
service contractor under ORS 750.045, or under the laws of another state
establishing similar requirements, shall be confidential and shall not be
disclosed except as [considered necessary
by the director in administration of the Insurance Code] provided in section 2 of this 2001 Act.
(2) A financial plan of action stating corrective actions
to be taken by an insurer in response to a determination of inadequate capital
or surplus, or any combination thereof, that is filed by the insurer with the
director according to requirements established by rule shall be confidential
and shall not be disclosed except as [considered
necessary by the director in administration of the Insurance Code] provided in section 2 of this 2001 Act.
(3) The results or report of any examination or analysis of
an insurer performed by the director in connection with a financial plan
described in subsection (2) of this section and any corrective order issued by
the director pursuant to such an examination or analysis shall be confidential
and shall not be disclosed except as [considered
necessary by the director in administration of the Insurance Code] provided in section 2 of this 2001 Act.
[(4) Documents
described in subsections (1) to (3) of this section are not subject to subpoena
and shall not be used in any action or proceeding except to the extent
considered necessary by the director in the administration of the Insurance
Code.]
[(5)] (4) Information contained in documents
described in subsections (1) to (3) of this section that is also contained in
financial statements of insurers filed under ORS 731.574 or in final
examination reports filed under ORS 731.312 is not confidential under this
section.
SECTION 9.
ORS 732.230 is amended to read:
732.230. (1) Whenever the Director of the Department of
Consumer and Business Services determines from any showing or statement made to
the director or from any examination made by the director that the assets of a
domestic insurer are less than its liabilities plus required capitalization,
the director may proceed immediately under the provisions of ORS chapter 734 or
the director may allow the insurer a period of time, not to exceed 90 days, in
which to make good the amount of the impairment with cash or authorized investments.
(2) If the amount of any such impairment is not made good
within the time prescribed by the director under subsection (1) of this
section, the director shall proceed under the provisions of ORS chapter 734.
(3) [The director may
withhold from public inspection] An order directing an insurer to cure an
impairment is confidential as provided
in section 2 of this 2001 Act, for such time as the director considers
proper but not exceeding the time prescribed by the director for making the
amount of the impairment good[,]. If the director determines that the public interest in disclosure outweighs
the public interest in protecting or salvaging the solvency of the insurer [outweighs the public interest in disclosure], the director may make the order available
for public inspection.
SECTION 10.
ORS 732.523 is amended to read:
732.523. (1) An acquiring party:
(a) Must file with the Director of the Department of
Consumer and Business Services for approval a statement containing the
information required in this section. If more than one acquiring party is
required to file a statement under this paragraph, any or all such parties
acting in concert may file a joint statement.
(b) Must deliver or mail to the domestic insurer to which
the activity described in ORS 732.521 (1) applies, concurrently with filing the
statement under paragraph (a) of this subsection, a statement containing the
information required by this section. A statement mailed under this paragraph
shall be sent by certified mail, return receipt requested. If a joint statement
is filed under paragraph (a) of this subsection, the joint statement shall be
the statement mailed or delivered under this paragraph.
(2) The statement to be filed with the director under this
section shall be made under oath or affirmation and shall contain the following
information:
(a) The name and address of the domestic insurer involved
and each acquiring party required to file the statement, and additional
biographical and business information about each acquiring party required to
file the statement, business plans and information regarding persons who will
serve as or perform functions of directors or officers, as required by the
director.
(b) The source, nature and amount of the consideration used
or to be used in effecting the activity, a description of any transaction in
which funds were or are to be obtained for the activity and the identity of
persons furnishing the consideration. However, when a source of consideration
is a loan made in the lender’s ordinary course of business, the identity of the
lender shall remain confidential as
provided in section 2 of this 2001 Act, if the acquiring party filing the
statement so requests.
(c) Fully audited financial information as to the earnings
and financial condition of each acquiring party for the preceding five fiscal
years of the acquiring party, or for such lesser period as the acquiring party
and any predecessors of the acquiring party have been in existence, and similar
unaudited information as of a date not earlier than 90 days prior to the filing
of the statement.
(d) Any plan or proposals of each acquiring party required
to file a statement to liquidate the insurer, to sell its assets or merge or
consolidate it with any person, or to make any other material change in its
business or corporate structure or management.
(e) As required by the director, information regarding
shares to be acquired by an acquiring party in connection with the activity,
information regarding related offers or agreements, information regarding
classes of security to be acquired and related contracts, arrangements or
understandings, and information regarding related purchases of securities and
recommendations to purchase.
(f) Any additional information required by the director.
(3) All requests or invitations for tenders or
advertisements making a tender offer or requesting or inviting tenders of
securities for control of a domestic insurer made by or on behalf of any
acquiring party required to file the statement under this section shall contain
such information specified in subsection (2) of this section as the director
may prescribe. Copies of the materials shall be filed with the director at
least 10 days prior to the time the materials are first published or sent or
given to security holders. Any additional materials soliciting or requesting
the tenders subsequent to the initial solicitation or request shall contain
such information as the director may prescribe. Copies of the additional
materials shall be filed with the director at least 10 days prior to the time
the materials are first published or sent or given to security holders.
(4) If any acquiring party required to file the statement
under this section is a partnership, limited partnership, syndicate or other
group, the director may require that the information called for by subsection
(2) of this section be given with respect to each partner of the partnership or
limited partnership, each member of the syndicate or group and each person who
controls the partner or member. If any such partner, member or person is a
corporation or if the acquiring party is a corporation, the director may
require that the information called for by subsection (2) of this section be
given with respect to the corporation and each officer and director of the
corporation and each person who is directly or indirectly the beneficial owner
of more than 10 percent of the outstanding securities of the corporation.
(5) If any material change occurs in the facts set forth in
the statement filed under this section, the party who filed the statement must
file with the director and send to the insurer, within two business days after
the party learns of the change, an amendment setting forth the change together
with copies of all documents and other material relevant to the change.
(6) If an offer, request, invitation, agreement or
acquisition referred to in ORS 732.521 (1) is proposed to be made by means of a
registration statement under the Securities Act of 1933 or in circumstances
requiring the disclosure of similar information under the Securities Exchange
Act of 1934, or under a state law requiring similar registration or disclosure,
the party or parties required to file the statement under this section may use
such documents in furnishing the information called for by that statement.
(7) Any acquiring party may file with the completed
statement or within 10 days thereafter a written request for a hearing on the
acquisition. The insurer to be acquired may file with the director a written
request for a hearing on the acquisition within 10 days after the filing of the
completed statement.
SECTION 11.
ORS 732.586 is amended to read:
732.586. (1) All information, documents and copies thereof
obtained by or disclosed to the Director of the Department of Consumer and
Business Services or any other person in the course of an examination or
investigation made pursuant to ORS 732.584 are subject to [disclosure as provided in] the
provisions of ORS 731.312.
(2) All information reported pursuant to ORS 732.552, 732.554,
732.574 and 732.576 [are exempt from
disclosure and shall not be made public by the director, the National
Association of Insurance Commissioners or any other person. As provided in ORS
731.312, the director may disclose reported information in the furtherance of a
judicial or administrative proceeding and to the insurance department of any
other state or country, the National Association of Insurance Commissioners and
law enforcement officials of this or any other state or of an agency of the
federal government] is confidential
and may not be made public except as provided in this subsection. The director
may disclose reported information only as provided in section 2 of this 2001
Act. Otherwise, the director may disclose such reported information only as
follows:
(a) If the director obtains the prior written consent of
the insurer to which the reported information pertains; or
(b) If the director, after giving the insurer and its
affiliates who would be affected thereby notice and opportunity to be heard,
determines that the interest of policyholders, shareholders or the public will
be served by the publication thereof. If the director determines that one or
more of such interests will be so served, the director may publish all or any
part thereof in any manner that the director determines to be appropriate.
SECTION 12.
ORS 733.304 is amended to read:
733.304. (1) Each insurer transacting life insurance in
this state shall submit annually to the Director of the Department of Consumer
and Business Services the opinion of a qualified actuary as provided in this
section. The following provisions apply with respect to opinions required under
this subsection:
(a) The opinion must state whether, in the opinion of the
qualified actuary, the reserves and related actuarial items held in support of
the policies and contracts specified by the director by rule are computed
appropriately, are based on assumptions that satisfy contractual provisions,
are consistent with prior reported amounts and comply with applicable laws of
this state. The director by rule shall establish the specific requirements for
the opinion and may require any other items that the director determines to be
necessary to its scope.
(b) The opinion shall be submitted with the annual
statement reflecting the valuation of the reserve liabilities for each year.
(c) The opinion shall apply to all business in force,
including individual and group health insurance plans, in form and substance
acceptable to the director as specified by rule.
(d) The director by rule:
(A) Shall adopt standards on which actuarial opinions under
this subsection must be based. In adopting the standards, the director shall
consider standards established from time to time by the Actuarial Standards
Board of the American Academy of Actuaries.
(B) Shall define “qualified actuary” for purposes of this
subsection, by establishing qualifications required of an actuary for the
purpose of giving the opinions. In establishing the definition, the director
shall consider standards established from time to time by the American Academy
of Actuaries.
(C) May also adopt any other rules needed for carrying out
this subsection.
(e) In the case of an opinion required to be submitted by a
foreign or alien insurer, the director may accept the opinion filed by the
insurer with the insurance supervisory official of another state if the
director determines that the opinion reasonably meets the requirements
applicable to a domestic insurer.
(f) Except in cases of fraud or willful misconduct, a
qualified actuary shall not be liable for damages to any person other than the
insurer or the director for any act, error, omission, decision or conduct with
respect to the actuary’s opinion.
(g) For each opinion submitted under this subsection, a
memorandum shall be prepared supporting the opinion. The memorandum must
conform in form and substance to requirements established by the director by
rule.
(h) If an insurer fails to provide a supporting memorandum
within the period specified by rule or if the director determines that the
supporting memorandum provided by the insurer fails to meet the standards
prescribed by rule or is otherwise unacceptable to the director, the director
may engage a qualified actuary at the expense of the insurer to review the
opinion and the basis for the opinion and prepare any supporting memorandum
that is required by the director.
(i) [A memorandum in
support of an actuarial opinion under this subsection and any other material
provided to the director in connection therewith shall be confidential and
shall not be disclosed except as considered necessary by the director in the
administration of the Insurance Code. Such a memorandum and such material also
shall not be subject to subpoena, other than for the purpose of defending an
action seeking damages from any person by reason of any action required by this
section or by rules adopted under this section.] Except as provided in this paragraph, a memorandum in the possession or
control of the director that is in support of an actuarial opinion, and any
other material provided by the insurer to the director in connection with the
memorandum, is confidential as provided in section 2 of this 2001 Act.
Notwithstanding section 2 of this 2001 Act, such a memorandum and other materials
are subject to subpoena only for the purpose of defending an action seeking
damages from the actuary submitting the memorandum by reason of any action
required by this section or by rules adopted under this section. Once any
portion of the confidential memorandum is cited by the insurer in its marketing
or is cited before any governmental agency other than a state insurance
department or is released by the insurer to the news media, all portions of the
confidential memorandum shall be no longer confidential. In addition to the uses and disclosures allowed under section 2 of this
2001 Act, a memorandum or other material may otherwise be released by the
director:
(A) With the written consent of the insurer; or
(B) To the American Academy of Actuaries upon request
thereof, when the request states that the memorandum or other material is
required for the purpose of professional disciplinary proceedings and sets
forth procedures satisfactory to the director for preserving the
confidentiality of the memorandum or other material.
(j) Grounds for disciplinary action by the director against
the insurer or the qualified actuary shall be defined by rule.
(2) Unless exempted by the director by rule, each insurer
transacting life insurance in this state shall include in each opinion required
by subsection (1) of this section an opinion by the same actuary who prepared
the opinion required by subsection (1) of this section. The following
provisions apply with respect to the opinion:
(a) The actuary shall state the actuary’s opinion as to
whether the reserves and related actuarial items held in support of the
policies and contracts specified by the director by rule, when considered in
light of the assets held by the insurer with respect to the reserves and
related actuarial items, including but not limited to the investment earnings
on the assets and the considerations anticipated to be received and retained
under the policies and contracts, make adequate provision for the insurer’s
obligations under the policies and contracts, including but not limited to the
benefits under and expenses associated with the policies and contracts.
(b) The director may provide by rule for a transition
period for establishing any higher reserves that the actuary may deem necessary
in order to render the opinion required under this subsection.
SECTION 13.
ORS 735.425 is amended to read:
735.425. (1) Within 90 days after the placing of any
surplus lines insurance, each surplus lines licensee shall file with the
Director of the Department of Consumer and Business Services:
(a) An affidavit
regarding the insurance, which shall be kept confidential as provided in section 2 of this 2001 Act,
[regarding the insurance,] including
the following:
(A) The name and address of the insured;
(B) The identity of the insurer or insurers;
(C) A description of the subject and location of the risk;
(D) The amount of premium charged for the insurance; and
(E) Such other pertinent information as the director may
reasonably require.
(b) A statement on a standardized form furnished by the
director, as to the diligent efforts by the producing agent to place the
coverage with admitted insurers and the results thereof. The statement shall
affirm that the insured was expressly advised prior to placement of the insurance
that:
(A) The surplus lines insurer with whom the insurance was
to be placed is not licensed in this state and is not subject to its
supervision; and
(B) In the event of the insolvency of the surplus lines
insurer, losses will not be paid by the state insurance guaranty fund.
(2) The director may direct that filings required under
this section be made to the Surplus Lines Association of Oregon.
SECTION 13a.
If Senate Bill 268 becomes law, section
45, chapter 191, Oregon Laws 2001 (Enrolled Senate Bill 268) (amending ORS
735.425), is repealed and ORS 735.425, as amended by section 13 of this 2001
Act, is amended to read:
735.425. (1) Within 90 days after the placing of any
surplus lines insurance in this state,
each surplus lines licensee shall file with the Director of the Department of
Consumer and Business Services:
(a) An affidavit
signed by the licensee regarding the insurance, which shall be kept
confidential as provided in section 2 of this 2001 Act, including the
following:
(A) The name and address of the insured;
(B) The identity of the insurer or insurers;
(C) A description of the subject and location of the risk;
(D) The amount of premium charged for the insurance; and
(E) Such other pertinent information as the director may
reasonably require.
(b) A statement on a standardized form furnished by the
director, as to the diligent efforts by the producing agent to place the
coverage with admitted insurers and the results thereof. The statement shall be signed by the producing agent and shall affirm
that the insured was expressly advised prior to placement of the insurance
that:
(A) The surplus lines insurer with whom the insurance was
to be placed is not licensed in this state and is not subject to its
supervision; and
(B) In the event of the insolvency of the surplus lines
insurer, losses will not be paid by the state insurance guaranty fund.
(2) The director may direct that filings required under subsection (1) of this section be made
to the Surplus Lines Association of Oregon.
The director may also require that such filings be made electronically but may
exempt a licensee from the requirement for good cause shown.
(3) A nonresident
surplus lines licensee or nonresident insurance producer who places a surplus
lines policy on a risk with exposures located both in this state and outside
this state shall satisfy filing requirements established by the director by
rule. The director shall ensure that the rules facilitate interstate regulation
of surplus lines insurance transactions.
SECTION 13b.
(1) The amendments to ORS 735.425 by
section 13a of this 2001 Act become operative on January 1, 2002.
(2) The Director of the
Department of Consumer and Business Services may take any action before the
operative date of the amendments to ORS 735.425 by section 13a of this 2001 Act
that is necessary to enable the director to exercise, on and after the operative
date of the amendments to ORS 735.425 by section 13a of this 2001 Act, all the
duties, functions and powers conferred on the director by the amendments to ORS
735.425 by section 13a of this 2001 Act.
SECTION 14.
ORS 735.430 is amended to read:
735.430. (1) The Surplus Lines Association of Oregon shall
be the advisory organization of surplus lines licensees to:
(a) Facilitate and encourage compliance by its members with
the laws of this state and the rules of the Director of the Department of
Consumer and Business Services relative to surplus lines insurance;
(b) Provide means for the examination, which shall remain
confidential as provided in section 2 of
this 2001 Act, of all surplus lines coverage written by its members to
determine whether such coverages comply with such laws;
(c) Communicate with organizations of admitted insurers
with respect to the proper use of the surplus lines market;
(d) Receive and disseminate to its members information
relative to surplus lines coverages; and
(e) Receive and collect on behalf of the state and remit to
the state premium receipts tax for surplus lines insurance.
(2) The Surplus Lines Association of Oregon shall file with
the director:
(a) A copy of its constitution, articles of agreement or
association or certificate of incorporation;
(b) A copy of its bylaws and rules governing its
activities;
(c) A current list of members;
(d) The name and address of a resident of this state upon
whom notices or orders of the director or processes issued at the direction of
the director may be served;
(e) An agreement that the director may examine the Surplus
Lines Association of Oregon in accordance with the provisions of this section;
and
(f) A schedule of membership fees and charges.
(3) The director may make or cause to be made an
examination of the surplus lines advisory organization. The reasonable cost of
any such examination shall be paid by the surplus lines advisory organization
upon presentation to it by the director of a detailed account of each cost. The
officers, managers, agents and employees of the surplus lines advisory
organization may be examined at any time, under oath, and shall exhibit all
books, records, accounts, documents or agreements governing its method of
operation. The director shall furnish two copies of the examination report to
the surplus lines advisory organization examined and shall notify such
organization that it may, within 20 days thereof, request a hearing on the
report or on any facts or recommendations therein. If the director finds the
surplus lines advisory organization or any member thereof to be in violation of
ORS 735.400 to 735.495, the director may issue an order requiring the
discontinuance of such violation.
SECTION 15.
ORS 744.346 is amended to read:
744.346. (1) The Director of the Department of Consumer and
Business Services may examine the business and practices of any licensee or
applicant for a license when the director determines an examination to be
necessary. The director may order a licensee or applicant to produce any
records, books, files or other information reasonably necessary to ascertain
whether or not the licensee or applicant is acting or has acted in violation of
the law or otherwise contrary to the interests of the public. The expenses
incurred in conducting any examination shall be paid by the licensee or
applicant.
(2) A life settlement provider shall maintain records of
all transactions of life settlement contracts of the life settlement provider
and must make the records available to the director for inspection during
reasonable business hours. The records must be maintained for a period of not
later than five years from the date of their creation.
(3) The director at any time may require a licensee to
fully disclose the identity of all stockholders, partners, officers and
employees.
(4) Names of, and individual identification data for, all
policyholders and certificate holders who have entered life settlement
contracts with life settlement providers shall be confidential [and shall not be disclosed except as
considered necessary by the director in administration of the Insurance Code]
as provided in section 2 of this 2001 Act.
SECTION 16.
ORS 744.724 is amended to read:
744.724. (1) Except as provided in subsection (4) of this
section, a third party administrator shall maintain and make available to the
insurer complete books and records of each transaction performed on behalf of
the insurer. The books and records shall be maintained in accordance with
prudent standards of insurance recordkeeping and must be maintained for a
period of not less than five years from the date of their creation.
(2) The Director of the Department of Consumer and Business
Services shall have access to the books and records maintained under subsection
(1) of this section for the purpose of examination, audit and inspection. [The director shall keep confidential any
trade secrets contained in the books and records, including the identity and
addresses of policyholders and certificate holders, except that the director
may use any such information in any proceedings instituted against the third
party administrator.] Any document,
material or other information in the possession or control of the director that
is furnished by a third party administrator, an insurer, an agent or an
employee or an agent acting on behalf of the third party administrator, insurer
or agent, or that is obtained by the director in an investigation, shall be
confidential as provided in section 2 of this 2001 Act.
(3) An insurer that has entered into an agreement with a
third party administrator shall own the records generated by the third party
administrator pertaining to the insurer. However, the third party administrator
has the right to continuing access to the books and records to permit the third
party administrator to fulfill all of its contractual obligations to insured
parties, claimants and the insurer.
(4) If an insurer and third party administrator cancel
their agreement, the third party administrator may agree in writing with the
insurer to transfer all records to a successor third party administrator. If
the agreement includes provisions to transfer the records, the third party
administrator is no longer responsible for retaining the records for the
five-year period. The successor third party administrator shall acknowledge in
writing as part of its agreement with the insurer that it is responsible for
retaining the records of the prior third party administrator as required in
subsection (1) of this section.
SECTION 17.
ORS 192.502 is amended to read:
192.502. The following public records are exempt from
disclosure under ORS 192.410 to 192.505:
(1) Communications within a public body or between public
bodies of an advisory nature to the extent that they cover other than purely
factual materials and are preliminary to any final agency determination of
policy or action. This exemption shall not apply unless the public body shows
that in the particular instance the public interest in encouraging frank
communication between officials and employees of public bodies clearly
outweighs the public interest in disclosure.
(2) Information of a personal nature such as but not limited
to that kept in a personal, medical or similar file, if the public disclosure
thereof would constitute an unreasonable invasion of privacy, unless the public
interest by clear and convincing evidence requires disclosure in the particular
instance. The party seeking disclosure shall have the burden of showing that
public disclosure would not constitute an unreasonable invasion of privacy.
(3)(a) Public body employee or volunteer addresses, dates
of birth and telephone numbers contained in personnel records maintained by the
public body that is the employer or the recipient of volunteer services. This
exemption does not apply:
(A) To such employees or volunteers if they are elected
officials, except that a judge or district attorney subject to election may
seek to exempt the judge’s or district attorney’s address or telephone number,
or both, under the terms of ORS 192.445;
(B) To such employees or volunteers to the extent that the
party seeking disclosure shows by clear and convincing evidence that the public
interest requires disclosure in a particular instance; or
(C) To a substitute teacher as defined in ORS 342.815 when
requested by a professional education association of which the substitute
teacher may be a member.
(b) Nothing in this subsection exempting employee records
from disclosure relieves a public employer of any duty under ORS 243.650 to
243.782.
(4) Information submitted to a public body in confidence
and not otherwise required by law to be submitted, where such information
should reasonably be considered confidential, the public body has obliged
itself in good faith not to disclose the information, and when the public
interest would suffer by the disclosure.
(5) Information or records of the Department of
Corrections, including the State Board of Parole and Post-Prison Supervision,
to the extent that disclosure thereof would interfere with the rehabilitation
of a person in custody of the department or substantially prejudice or prevent
the carrying out of the functions of the department, if the public interest in
confidentiality clearly outweighs the public interest in disclosure.
(6) Records, reports and other information received or
compiled by the Director of the Department of Consumer and Business Services in
the administration of ORS chapters 723 and 725 not otherwise required by law to
be made public, to the extent that the interests of lending institutions, their
officers, employees and customers in preserving the confidentiality of such
information outweighs the public interest in disclosure.
(7) Reports made to or filed with the court under ORS
137.077 or 137.530.
(8) Any public records or information the disclosure of
which is prohibited by federal law or regulations.
(9) Public records or information the disclosure of which
is prohibited or restricted or otherwise made confidential or privileged under
Oregon law.
(10) Public records or information described in this
section, furnished by the public body originally compiling, preparing or
receiving them to any other public officer or public body in connection with
performance of the duties of the recipient, if the considerations originally
giving rise to the confidential or exempt nature of the public records or
information remain applicable.
(11) Records of the Energy Facility Siting Council
concerning the review or approval of security programs pursuant to ORS 469.530.
(12) Employee and retiree address, telephone number and
other nonfinancial membership records and employee financial records maintained
by the Public Employees Retirement System pursuant to ORS chapter 238 and ORS
238.410.
(13) Records submitted by private persons or businesses to
the State Treasurer or the Oregon Investment Council relating to proposed
acquisition, exchange or liquidation of public investments under ORS chapter
293 may be treated as exempt from disclosure when and only to the extent that
disclosure of such records reasonably may be expected to substantially limit
the ability of the Oregon Investment Council to effectively compete or negotiate
for, solicit or conclude such transactions. Records which relate to concluded
transactions are not subject to this exemption.
(14) The monthly reports prepared and submitted under ORS
293.761 and 293.766 concerning the Public Employees Retirement Fund and the
Industrial Accident Fund may be uniformly treated as exempt from disclosure for
a period of up to 90 days after the end of the calendar quarter.
(15) Reports of unclaimed property filed by the holders of
such property to the extent permitted by ORS 98.352.
(16) The following records, communications and information
submitted to the Oregon Economic and Community Development Commission, the
Economic and Community Development Department, the State Department of
Agriculture, the Oregon Resource and Technology Development Account or the
Oregon Resource and Technology Development Account Board, the Port of Portland
or other ports, as defined in ORS 777.005, by applicants for investment funds,
loans or services including, but not limited to, those described in ORS
285A.224:
(a) Personal financial statements.
(b) Financial statements of applicants.
(c) Customer lists.
(d) Information of an applicant pertaining to litigation to
which the applicant is a party if the complaint has been filed, or if the
complaint has not been filed, if the applicant shows that such litigation is
reasonably likely to occur; this exemption does not apply to litigation which
has been concluded, and nothing in this paragraph shall limit any right or
opportunity granted by discovery or deposition statutes to a party to
litigation or potential litigation.
(e) Production, sales and cost data.
(f) Marketing strategy information that relates to
applicant’s plan to address specific markets and applicant’s strategy regarding
specific competitors.
(17) Records, reports or returns submitted by private
concerns or enterprises required by law to be submitted to or inspected by a
governmental body to allow it to determine the amount of any transient lodging
tax payable and the amounts of such tax payable or paid, to the extent that
such information is in a form which would permit identification of the
individual concern or enterprise. Nothing in this subsection shall limit the
use which can be made of such information for regulatory purposes or its
admissibility in any enforcement proceedings. The public body shall notify the
taxpayer of the delinquency immediately by certified mail. However, in the
event that the payment or delivery of transient lodging taxes otherwise due to
a public body is delinquent by over 60 days, the public body shall disclose,
upon the request of any person, the following information:
(a) The identity of the individual concern or enterprise
that is delinquent over 60 days in the payment or delivery of the taxes.
(b) The period for which the taxes are delinquent.
(c) The actual, or estimated, amount of the delinquency.
(18) All information supplied by a person under ORS 151.430
to 151.491 for the purpose of requesting court-appointed counsel, and all
information supplied to the State Court Administrator from whatever source for
the purpose of verifying indigency of a person pursuant to ORS 151.430 to
151.491.
(19) Workers’ compensation claim records of the Department
of Consumer and Business Services, except in accordance with rules adopted by
the Director of the Department of Consumer and Business Services, in any of the
following circumstances:
(a) When necessary for insurers, self-insured employers and
third party claim administrators to process workers’ compensation claims.
(b) When necessary for the director, other governmental
agencies of this state or the United States to carry out their duties,
functions or powers.
(c) When the disclosure is made in such a manner that the
disclosed information cannot be used to identify any worker who is the subject
of a claim.
(d) When a worker or the worker’s representative requests
review of the worker’s claim record.
(20) Sensitive business records or financial or commercial
information of the Oregon Health Sciences University that is not customarily
provided to business competitors.
(21) Records of Oregon Health Sciences University regarding
candidates for the position of president of the university.
(22) The records of a library, including circulation
records, showing use of specific library material by a named person or
consisting of the name of a library patron together with the address or
telephone number, or both, of the patron.
(23) The following records, communications and information
submitted to the Housing and Community Services Department by applicants for
and recipients of loans, grants and tax credits:
(a) Personal and corporate financial statements and
information, including tax returns.
(b) Credit reports.
(c) Project appraisals.
(d) Market studies and analyses.
(e) Articles of incorporation, partnership agreements and
operating agreements.
(f) Commitment letters.
(g) Project pro forma statements.
(h) Project cost certifications and cost data.
(i) Audits.
(j) Project tenant correspondence requested to be
confidential.
(k) Tenant files relating to certification.
(L) Housing assistance payment requests.
(24) Raster geographic information system (GIS) digital
databases, provided by private forestland owners or their representatives,
voluntarily and in confidence to the State Forestry Department, that is not
otherwise required by law to be submitted.
(25) Sensitive business, commercial or financial
information furnished to or developed by a public body engaged in the business
of providing electricity or electricity services, if the information is
directly related to a transaction described in ORS 261.348, or if the
information is directly related to a bid, proposal or negotiations for the sale
or purchase of electricity or electricity services, and disclosure of the
information would cause a competitive disadvantage for the public body or its
retail electricity customers. This subsection does not apply to cost-of-service
studies used in the development or review of generally applicable rate schedules.
(26) Sensitive business, commercial or financial
information furnished to or developed by the City of Klamath Falls, acting
solely in connection with the ownership and operation of the Klamath
Cogeneration Project, if the information is directly related to a transaction
described in ORS 225.085 and disclosure of the information would cause a
competitive disadvantage for the Klamath Cogeneration Project. This subsection
does not apply to cost-of-service studies used in the development or review of
generally applicable rate schedules.
(27) Personally identifiable information about customers of
a municipal electric utility or a people’s utility district. The utility or
district may, however, release such information to a third party if the
customer consents in writing or electronically, if the disclosure is necessary
to render utility or district services to the customer, or if the disclosure is
required pursuant to a court order. The utility or district may charge as
appropriate for the costs of providing such information. The utility or
district may make customer records available to third party credit agencies on
a regular basis in connection with the establishment and management of customer
accounts or in the event such accounts are delinquent.
(28) A record of the street and number of an employee’s
address submitted to a special district to obtain assistance in promoting an
alternative to single occupant motor vehicle transportation.
(29) Except under the provisions of section 8 (2), chapter
1059, Oregon Laws 1999, pesticide sales or use reporting data obtained by the
State Department of Agriculture exclusively under the provisions of sections 2
to 9, chapter 1059, Oregon Laws 1999, that would reveal the identity or
specific location of the owner or lessee of a specific property where a
pesticide has been applied for a private agriculture or forestry production
operation, or other nonpublic facility on private property. Nothing in this
subsection shall limit the use that may be made of such information for
regulatory purposes or its admissibility in any enforcement proceedings.
(30) Sensitive business records, capital development plans
or financial or commercial information of Oregon Corrections Enterprises that
is not customarily provided to business competitors.
(31) Documents,
materials or other information submitted to the Director of the Department of
Consumer and Business Services in confidence by a state, federal, foreign or
international regulatory or law enforcement agency or by the National Association
of Insurance Commissioners, its affiliates or subsidiaries under ORS 646.380 to
646.396, 697.005 to 697.095, 697.602 to 697.842, 717.200 to 717.320, 717.900 or
717.905, ORS chapter 59, 722, 723, 725 or 726, the Bank Act or the Insurance
Code or section 2 of this 2001 Act when:
(a) The document,
material or other information is received upon notice or with an understanding
that it is confidential or privileged under the laws of the jurisdiction that
is the source of the document, material or other information; and
(b) The director has
obligated the Department of Consumer and Business Services not to disclose the
document, material or other information.
SECTION 18.
ORS 192.502, as amended by section 16, chapter 1059, Oregon Laws 1999, is
amended to read:
192.502. The following public records are exempt from
disclosure under ORS 192.410 to 192.505:
(1) Communications within a public body or between public
bodies of an advisory nature to the extent that they cover other than purely
factual materials and are preliminary to any final agency determination of
policy or action. This exemption shall not apply unless the public body shows
that in the particular instance the public interest in encouraging frank
communication between officials and employees of public bodies clearly
outweighs the public interest in disclosure.
(2) Information of a personal nature such as but not
limited to that kept in a personal, medical or similar file, if the public
disclosure thereof would constitute an unreasonable invasion of privacy, unless
the public interest by clear and convincing evidence requires disclosure in the
particular instance. The party seeking disclosure shall have the burden of
showing that public disclosure would not constitute an unreasonable invasion of
privacy.
(3)(a) Public body employee or volunteer addresses, dates
of birth and telephone numbers contained in personnel records maintained by the
public body that is the employer or the recipient of volunteer services. This
exemption does not apply:
(A) To such employees or volunteers if they are elected
officials, except that a judge or district attorney subject to election may
seek to exempt the judge’s or district attorney’s address or telephone number,
or both, under the terms of ORS 192.445;
(B) To such employees or volunteers to the extent that the
party seeking disclosure shows by clear and convincing evidence that the public
interest requires disclosure in a particular instance; or
(C) To a substitute teacher as defined in ORS 342.815 when
requested by a professional education association of which the substitute
teacher may be a member.
(b) Nothing in this subsection exempting employee records
from disclosure relieves a public employer of any duty under ORS 243.650 to
243.782.
(4) Information submitted to a public body in confidence
and not otherwise required by law to be submitted, where such information
should reasonably be considered confidential, the public body has obliged
itself in good faith not to disclose the information, and when the public
interest would suffer by the disclosure.
(5) Information or records of the Department of
Corrections, including the State Board of Parole and Post-Prison Supervision,
to the extent that disclosure thereof would interfere with the rehabilitation
of a person in custody of the department or substantially prejudice or prevent
the carrying out of the functions of the department, if the public interest in
confidentiality clearly outweighs the public interest in disclosure.
(6) Records, reports and other information received or
compiled by the Director of the Department of Consumer and Business Services in
the administration of ORS chapters 723 and 725 not otherwise required by law to
be made public, to the extent that the interests of lending institutions, their
officers, employees and customers in preserving the confidentiality of such
information outweighs the public interest in disclosure.
(7) Reports made to or filed with the court under ORS
137.077 or 137.530.
(8) Any public records or information the disclosure of
which is prohibited by federal law or regulations.
(9) Public records or information the disclosure of which
is prohibited or restricted or otherwise made confidential or privileged under
Oregon law.
(10) Public records or information described in this
section, furnished by the public body originally compiling, preparing or
receiving them to any other public officer or public body in connection with
performance of the duties of the recipient, if the considerations originally
giving rise to the confidential or exempt nature of the public records or
information remain applicable.
(11) Records of the Energy Facility Siting Council
concerning the review or approval of security programs pursuant to ORS 469.530.
(12) Employee and retiree address, telephone number and
other nonfinancial membership records and employee financial records maintained
by the Public Employees Retirement System pursuant to ORS chapter 238 and ORS
238.410.
(13) Records submitted by private persons or businesses to
the State Treasurer or the Oregon Investment Council relating to proposed
acquisition, exchange or liquidation of public investments under ORS chapter
293 may be treated as exempt from disclosure when and only to the extent that
disclosure of such records reasonably may be expected to substantially limit
the ability of the Oregon Investment Council to effectively compete or
negotiate for, solicit or conclude such transactions. Records which relate to
concluded transactions are not subject to this exemption.
(14) The monthly reports prepared and submitted under ORS
293.761 and 293.766 concerning the Public Employees Retirement Fund and the
Industrial Accident Fund may be uniformly treated as exempt from disclosure for
a period of up to 90 days after the end of the calendar quarter.
(15) Reports of unclaimed property filed by the holders of
such property to the extent permitted by ORS 98.352.
(16) The following records, communications and information
submitted to the Oregon Economic and Community Development Commission, the
Economic and Community Development Department, the State Department of
Agriculture, the Oregon Resource and Technology Development Account or the
Oregon Resource and Technology Development Account Board, the Port of Portland
or other ports, as defined in ORS 777.005, by applicants for investment funds,
loans or services including, but not limited to, those described in ORS
285A.224:
(a) Personal financial statements.
(b) Financial statements of applicants.
(c) Customer lists.
(d) Information of an applicant pertaining to litigation to
which the applicant is a party if the complaint has been filed, or if the
complaint has not been filed, if the applicant shows that such litigation is
reasonably likely to occur; this exemption does not apply to litigation which
has been concluded, and nothing in this paragraph shall limit any right or
opportunity granted by discovery or deposition statutes to a party to
litigation or potential litigation.
(e) Production, sales and cost data.
(f) Marketing strategy information that relates to
applicant’s plan to address specific markets and applicant’s strategy regarding
specific competitors.
(17) Records, reports or returns submitted by private
concerns or enterprises required by law to be submitted to or inspected by a
governmental body to allow it to determine the amount of any transient lodging
tax payable and the amounts of such tax payable or paid, to the extent that
such information is in a form which would permit identification of the
individual concern or enterprise. Nothing in this subsection shall limit the
use which can be made of such information for regulatory purposes or its
admissibility in any enforcement proceedings. The public body shall notify the
taxpayer of the delinquency immediately by certified mail. However, in the
event that the payment or delivery of transient lodging taxes otherwise due to
a public body is delinquent by over 60 days, the public body shall disclose,
upon the request of any person, the following information:
(a) The identity of the individual concern or enterprise
that is delinquent over 60 days in the payment or delivery of the taxes.
(b) The period for which the taxes are delinquent.
(c) The actual, or estimated, amount of the delinquency.
(18) All information supplied by a person under ORS 151.430
to 151.491 for the purpose of requesting court-appointed counsel, and all
information supplied to the State Court Administrator from whatever source for
the purpose of verifying indigency of a person pursuant to ORS 151.430 to
151.491.
(19) Workers’ compensation claim records of the Department
of Consumer and Business Services, except in accordance with rules adopted by
the Director of the Department of Consumer and Business Services, in any of the
following circumstances:
(a) When necessary for insurers, self-insured employers and
third party claim administrators to process workers’ compensation claims.
(b) When necessary for the director, other governmental
agencies of this state or the United States to carry out their duties,
functions or powers.
(c) When the disclosure is made in such a manner that the
disclosed information cannot be used to identify any worker who is the subject
of a claim.
(d) When a worker or the worker’s representative requests
review of the worker’s claim record.
(20) Sensitive business records or financial or commercial
information of the Oregon Health Sciences University that is not customarily
provided to business competitors.
(21) Records of Oregon Health Sciences University regarding
candidates for the position of president of the university.
(22) The records of a library, including circulation
records, showing use of specific library material by a named person or
consisting of the name of a library patron together with the address or
telephone number, or both, of the patron.
(23) The following records, communications and information
submitted to the Housing and Community Services Department by applicants for
and recipients of loans, grants and tax credits:
(a) Personal and corporate financial statements and
information, including tax returns.
(b) Credit reports.
(c) Project appraisals.
(d) Market studies and analyses.
(e) Articles of incorporation, partnership agreements and
operating agreements.
(f) Commitment letters.
(g) Project pro forma statements.
(h) Project cost certifications and cost data.
(i) Audits.
(j) Project tenant correspondence requested to be
confidential.
(k) Tenant files relating to certification.
(L) Housing assistance payment requests.
(24) Raster geographic information system (GIS) digital
databases, provided by private forestland owners or their representatives,
voluntarily and in confidence to the State Forestry Department, that is not
otherwise required by law to be submitted.
(25) Sensitive business, commercial or financial
information furnished to or developed by a public body engaged in the business
of providing electricity or electricity services, if the information is
directly related to a transaction described in ORS 261.348, or if the information
is directly related to a bid, proposal or negotiations for the sale or purchase
of electricity or electricity services, and disclosure of the information would
cause a competitive disadvantage for the public body or its retail electricity
customers. This subsection does not apply to cost-of-service studies used in
the development or review of generally applicable rate schedules.
(26) Sensitive business, commercial or financial
information furnished to or developed by the City of Klamath Falls, acting solely
in connection with the ownership and operation of the Klamath Cogeneration
Project, if the information is directly related to a transaction described in
ORS 225.085 and disclosure of the information would cause a competitive
disadvantage for the Klamath Cogeneration Project. This subsection does not
apply to cost-of-service studies used in the development or review of generally
applicable rate schedules.
(27) Personally identifiable information about customers of
a municipal electric utility or a people’s utility district. The utility or
district may, however, release such information to a third party if the
customer consents in writing or electronically, if the disclosure is necessary
to render utility or district services to the customer, or if the disclosure is
required pursuant to a court order. The utility or district may charge as
appropriate for the costs of providing such information. The utility or
district may make customer records available to third party credit agencies on
a regular basis in connection with the establishment and management of customer
accounts or in the event such accounts are delinquent.
(28) A record of the street and number of an employee’s
address submitted to a special district to obtain assistance in promoting an
alternative to single occupant motor vehicle transportation.
(29) Sensitive business records, capital development plans
or financial or commercial information of Oregon Corrections Enterprises that
is not customarily provided to business competitors.
(30) Documents,
materials or other information submitted to the Director of the Department of
Consumer and Business Services in confidence by a state, federal, foreign or
international regulatory or law enforcement agency or by the National
Association of Insurance Commissioners, its affiliates or subsidiaries under
ORS 646.380 to 646.396, 697.005 to 697.095, 697.602 to 697.842, 717.200 to
717.320, 717.900 or 717.905, ORS chapter 59, 722, 723, 725 or 726, the Bank Act
or the Insurance Code or section 2 of this 2001 Act when:
(a) The document,
material or other information is received upon notice or with an understanding
that it is confidential or privileged under the laws of the jurisdiction that
is the source of the document, material or other information; and
(b) The director has
obligated the Department of Consumer and Business Services not to disclose the
document, material or other information.
SECTION 19.
ORS 748.603 is amended to read:
748.603. (1) Societies shall be governed by this chapter
and shall be exempt from all other provisions of the insurance laws of this
state unless expressly designated therein, or unless specifically made
applicable by this chapter.
(2) ORS 731.004 to 731.026, 731.032 to 731.136, 731.146 to
731.156, 731.162, 731.166, 731.170, 731.216 to 731.268, 731.296, 731.324,
731.328, 731.354, 731.356, 731.358, 731.378, 731.380, 731.381, 731.382,
731.385, 731.386, 731.390, 731.394, 731.396, 731.398, 731.402, 731.406,
731.410, 731.422 to 731.434, 731.446 to 731.454, 731.488, 731.504, 731.508,
731.509, 731.510, 731.511, 731.512, 731.592, 731.594, 731.730, 731.731,
731.735, 731.737, [731.740,] 731.750,
731.804, 731.844 to 731.992, 732.245, 732.250, 732.320, 732.325, 733.010 to
733.050, 733.080, 733.140 to 733.210, 733.220, 733.510, 733.652 to 733.658,
733.730 to 733.750, 735.600 to 735.650, 742.001, 742.003, 742.005, 742.007,
742.009, 742.013 to 742.021, 742.028, 742.038, 742.041, 742.046, 742.051,
742.150 to 742.162 and 744.700 to 744.740 and ORS chapters 734 and 743 and sections 2 and 3 of this 2001 Act
shall apply to fraternal benefit societies to the extent so applicable and not
inconsistent with the express provisions of this chapter.
(3) For the purposes of this subsection and subsection (2)
of this section, fraternal benefit societies shall be deemed insurers, and
benefit certificates issued by fraternal benefit societies shall be deemed
policies.
(4) Every society authorized to do business in this state
shall be subject to the provisions of ORS chapter 746 relating to unfair trade
practices. However, nothing in ORS chapter 746 shall be construed as applying
to or affecting the right of any society to determine its eligibility
requirements for membership, or be construed as applying to or affecting the
offering of benefits exclusively to members or persons eligible for membership
in the society by a subsidiary corporation or affiliated organization of the
society.
SECTION 20.
ORS 750.055 is amended to read:
750.055. (1) The following provisions of the Insurance Code
shall apply to health care service contractors to the extent so applicable and
not inconsistent with the express provisions of ORS 750.005 to 750.095:
(a) ORS 731.004 to 731.150, 731.162, 731.216 to 731.362,
731.382, 731.385, 731.386, 731.390, 731.398 to 731.430, 731.450, 731.454,
731.488, 731.504, 731.508, 731.509, 731.510, 731.511, 731.512, 731.574 to
731.620, 731.592, 731.594, 731.640 to 731.652, 731.730, 731.731, 731.735,
731.737, [731.740,] 731.750, 731.752, 731.804 and 731.844 to 731.992 and sections 2 and 3 of this 2001 Act.
(b) ORS 732.215, 732.220, 732.230, 732.245, 732.250,
732.320, 732.325 and 732.517 to 732.592, not including ORS 732.549 and 732.574
to 732.592.
(c)(A) ORS 733.010 to 733.050, 733.080, 733.140 to 733.170,
733.210, 733.510 to 733.620, 733.635 to 733.680 and 733.695 to 733.780 apply to
not-for-profit health care service contractors.
(B) ORS chapter 733, not including ORS 733.630, applies to
for-profit health care service contractors.
(d) ORS chapter 734.
(e) ORS 742.001 to 742.009, 742.013, 742.061, 742.065,
742.150 to 742.162, 742.400, 742.520 to 742.540, 743.010, 743.013, 743.018 to
743.030, 743.050, 743.100 to 743.109, 743.402, 743.412, 743.472, 743.492,
743.495, 743.498, 743.522, 743.523, 743.524, 743.526, 743.527, 743.528,
743.529, 743.549 to 743.555, 743.556, 743.560, 743.600 to 743.610, 743.650 to
743.656, 743.693, 743.697, 743.699, 743.701, 743.704, 743.706 to 743.712,
743.721, 743.722, 743.726, 743.727, 743.728, 743.729, 743.804, 743.807,
743.808, 743.809, 743.814 to 743.839, 743.842, 743.845 and 743.847.
(f) The provisions of ORS chapter 744 relating to the
regulation of agents.
(g) ORS 746.005 to 746.140, 746.160, 746.180, 746.220 to
746.370 and 746.600 to 746.690.
(h) ORS 743.714, except in the case of group practice
health maintenance organizations that are federally qualified pursuant to Title
XIII of the Public Health Service Act unless the patient is referred by a
physician associated with a group practice health maintenance organization.
(i) ORS 735.600 to 735.650.
(j) ORS 743.680 to 743.689.
(k) ORS 744.700 to 744.740.
(L) ORS 743.730 to 743.773.
(m) ORS 731.485, except in the case of a group practice
health maintenance organization that is federally qualified pursuant to Title
XIII of the Public Health Service Act and that wholly owns and operates an
in-house drug outlet.
(2) For the purposes of this section only, health care
service contractors shall be deemed insurers.
(3) Any for-profit health care service contractor organized
under the laws of any other state which is not governed by the insurance laws
of such state, will be subject to all requirements of ORS chapter 732.
(4) The Director of the Department of Consumer and Business
Services may, after notice and hearing, adopt reasonable rules not inconsistent
with this section and ORS 750.003, 750.005, 750.025 and 750.045 that are deemed
necessary for the proper administration of these provisions.
SECTION 21.
ORS 706.720 is amended to read:
706.720. (1) The Director of the Department of Consumer and
Business Services shall receive and file in the Department of Consumer and
Business Services all reports required by the Bank Act.
(2) Except as provided in subsection (3) of this section
and ORS 706.730, the records of the Department of Consumer and Business
Services pertaining to the administration of the Bank Act are available for
public inspection unless the director determines in the particular instance
that the public interest in disclosure of the records is outweighed by the
interests of an Oregon operating institution or its directors, stockholders,
officers, employees and customers in keeping the records confidential, or that
the records are exempt from disclosure under ORS 192.501 to 192.505. A
determination by the director under this subsection is subject to review under
ORS 192.410 to 192.505.
(3) Except as provided in subsections (4) and (5) of this
section, the following records of the department are exempt from disclosure or
production and shall be treated as
confidential as provided in section 2 of this 2001 Act:
(a) Examination reports and work papers, directives, orders
and correspondence that relate to examination reports.
(b) Investigatory information concerning persons subject to
investigation by the director under ORS 707.070, 707.080, 707.110, 707.140,
707.145, 707.155 or 707.705 and financial statements of such persons.
(c) Proprietary information.
(d) Reviews of financial statements submitted to the
director.
(e) Reports filed under ORS 706.655.
(f) Stockholder lists.
(4) Notwithstanding subsection (3) of this section, the
director may disclose any record of the department specified in this subsection
pertaining to an Oregon operating institution that has been liquidated under
ORS 711.400 to 711.615 if the director determines in the particular instance
that the public interest in disclosure of the record outweighs the interests of
the Oregon operating institution or its directors, stockholders, officers,
employees or customers in keeping the record confidential. Under no
circumstances, however, shall the director disclose any such record or portion
thereof that contains any proprietary information or any information relating
to the individual financial activities or affairs of persons unless the
director concludes that those activities or affairs were a direct and
substantial contributing factor in the failure of the Oregon operating
institution. This subsection applies to the following records of the
department:
(a) Examination reports and work papers, directives, orders
and correspondence relating to examination reports;
(b) Investigatory information concerning persons subject to
investigation by the director under ORS 707.070, 707.080, 707.110, 707.140,
707.145, 707.155 or 707.705;
(c) Reviews of financial statements; and
(d) Reports filed under ORS 706.655.
(5) Notwithstanding ORS 40.270, an officer of the
department may be examined concerning records that are exempt from disclosure
under subsection (2) or (3) of this section and ORS 706.730 and the records are
subject to production if the court before which a civil or criminal action is
pending finds that such examination and production is essential for
establishing a claim or defense. In making a finding under this subsection, if
the court views the records, the court shall do so in camera.
(6) A civil penalty imposed by the director under the Bank
Act shall become subject to public inspection after the 20th day after the
director imposes the civil penalty.
(7) All records of the department pertaining to the
condition of Oregon operating institutions may be furnished to:
(a) The Federal Reserve Bank and its examiners.
(b) The Comptroller of the Currency of the United States
and national bank examiners.
(c) The Federal Deposit Insurance Corporation and its
examiners.
(d) The Federal Home Loan Bank of which the operating
institution is a member or to which the operating institution has applied for
membership.
(e) The State Treasurer if the Oregon operating institution
is a depository of public fund deposits.
(f) Any supervisory authority that regulates financial
institutions, financial holding
companies or bank holding companies.
(g) The respective Oregon operating institution, or the financial holding company or bank
holding company that controls an Oregon operating institution.
(8) The director shall prescribe and furnish to interested
persons the forms for all reports required by the Bank Act.
(9) If the director is requested to disclose any record
subject to this section and the record contains both material that is exempt
from disclosure under this section or any other provision of law and material
that is not exempt from disclosure, the director shall separate the exempt and
nonexempt material and shall disclose only the nonexempt material.
SECTION 22.
ORS 706.723 is amended to read:
706.723. (1) Notwithstanding any other provision of law:
(a) Compliance review documents shall be confidential as provided in section 2 of this 2001 Act
and shall not be discoverable or admissible as evidence in any civil action or
administrative proceeding.
(b) Compliance review documents delivered to a state,
federal or foreign governmental or regulatory agency remain confidential as provided in section 2 of this 2001 Act
and shall not be discoverable or admissible in any civil action or
administrative proceeding.
(c) A person serving on a compliance review committee or
acting at the request of a compliance review committee may not be required to
testify in any civil action as to:
(A) The contents or conclusions of a compliance review
document; or
(B) The actions taken by a compliance review committee.
(2) This section does not limit the discovery or
admissibility in any civil action or administrative proceeding of any documents
that are not compliance review documents.
(3) Upon motion by any party, a court shall determine a
claim of confidentiality under this section after an in camera review of the
materials or information claimed to be confidential. If the court determines
that part, but not all, of the materials or information is confidential under
this section, the court shall ensure that only the materials or information
that is not confidential is disclosed.
(4) The provisions of this section do not affect the
ability of a person to claim any privilege that may be provided by law,
including but not limited to a claim of privilege under ORS 40.225.
(5) For the purposes of this section:
(a) “Compliance review committee” means a person or persons
assigned by a board of directors of a financial institution, or by the
management of a financial institution, to test, review or evaluate the conduct
of the financial institution, the transactions of the financial institution or
the potential transactions of the financial institution for the purpose of
monitoring, improving and enforcing compliance with:
(A) Safe, sound and fair lending practices;
(B) Financial reporting to state or federal regulatory
agencies;
(C) The financial institution’s own policies and
procedures; or
(D) Federal or state statutory or regulatory requirements
relating to financial institutions.
(b) “Compliance review document” means any document
prepared for or created by a compliance review committee.
SECTION 23.
ORS 706.730 is amended to read:
706.730. (1) The
name of a person who is a depositor or debtor of a bank and the amount of the
person’s deposit or debt are confidential as provided in section 2 of this 2001
Act. The Director of the Department of Consumer and Business Services or
any other person employed by the Department of Consumer and Business Services
shall not knowingly disclose the name of a person who is a depositor or debtor
of a bank, or the amount of the person’s deposit or debt, except that the
director or the employee may disclose such information as may be required under
ORS 706.720 (5) or as may be necessary in the performance of the director’s or
employee’s official duty including any duty under ORS 295.018.
(2) Subsection (1) of this section does not prohibit
disclosure of the name of any debtor or the amount of the person’s debt
included in reports that are filed under ORS 706.655, if the reports were filed
by a banking institution that has been liquidated or is in the process of being
liquidated under ORS 711.400 to 711.615 and if disclosure is otherwise allowed
under ORS 706.720.
SECTION 24.
ORS 722.419 is amended to read:
722.419. (1) Except as provided in subsections (2) and (3)
of this section, the records of the Department of Consumer and Business
Services pertaining to the administration of this chapter are available for
public inspection unless the Director of the Department of Consumer and
Business Services determines in the particular instance that the public
interest in disclosure of the records is outweighed by the interests of an
association or its directors, officers, employees, members and customers in
keeping the records confidential, or that the records are exempt from
disclosure under ORS 192.501 to 192.505. A determination by the director under
this subsection is subject to review under ORS 192.410 to 192.505.
(2) Except as provided in subsections (6) and (7) of this
section, the following records of the department pertaining to the
administration of this chapter are exempt from disclosure or production and shall be treated as confidential as
provided in section 2 of this 2001 Act:
(a) Examination reports and work papers, directives, orders
and correspondence that relate to examination reports.
(b) Investigatory information concerning persons subject to
investigation by the director under ORS 722.024, 722.026, 722.036, 722.134, 722.459
or 722.506, and financial statements of such persons.
(c) Proprietary information.
(d) Audits submitted to the director under ORS 722.434 (3).
(e) Reports submitted to the director under ORS 722.458.
(f) Stockholder lists.
(g) The name of a
depositor or debtor described in subsection (3) of this section and the amount
of the person’s deposit or debt.
(3) The director or any other person employed by the
department and acting under this chapter shall not knowingly disclose the name
of any person who is a depositor or debtor of an association, or the amount of
the person’s deposit or debt, except that the director or the employee may
disclose such information as may be necessary in the performance of the
director’s or employee’s official duty including any duty under ORS 295.018.
(4) Statements of financial condition filed under ORS
722.434 (1) are not confidential.
(5) A civil penalty imposed by the director shall become
subject to public inspection after the 20th day after the director imposes the
civil penalty.
(6) Notwithstanding subsection (2) of this section, the
director may disclose any record of the section specified in this subsection
pertaining to an association that has been liquidated if the director
determines in the particular instance that the public interest in disclosure of
the record outweighs the interests of the association or its directors,
stockholders, officers, employees or customers in keeping the record
confidential. Under no circumstances, however, shall the director disclose any
such record or portion thereof that contains any proprietary information or any
information relating to the individual financial activities or affairs of
persons unless the director concludes that those activities or affairs were a
direct and substantial contributing factor in the failure of the association.
This subsection applies to the following records of the section:
(a) Examination reports and work papers, directives, orders
and correspondence relating to examination reports;
(b) Investigatory information concerning persons subject to
investigation by the director under ORS 722.024, 722.026, 722.036, 722.134,
722.459 or 722.506;
(c) Audits submitted to the director under ORS 722.434 (3);
and
(d) Reports filed under ORS 722.458.
(7) Notwithstanding ORS 40.270, an officer of the
department may be examined concerning records that are exempt from disclosure
under subsection (1), (2) or (3) of this section and the records are subject to
production if the court before which a civil or criminal action is pending
finds that such examination and production is essential for establishing a
claim or defense. In making a finding under this subsection, if the court views
the records, the court shall do so in camera.
(8) In addition to
the authority granted the director in section 2 of this 2001 Act, all
records of the department pertaining to the condition of associations may be
furnished to:
(a) Representatives of savings and loan departments of
other states.
(b) Representatives of the Federal Housing Finance Board,
Washington, D.C., a Federal Home Loan Bank or other federal or state financial
agency organized under the laws of the United States or of this state and
authorized to loan to or otherwise act as a reserve or insuring agency for
savings associations.
(c) The State Treasurer if the association is a depository
of public fund deposits.
(9) If the director is requested to disclose any record
subject to this section and the record contains both material that is exempt
from disclosure under this section or any other provision of law and material
that is not exempt from disclosure, the director shall separate the exempt and
nonexempt material and shall disclose only the nonexempt material.
SECTION 25.
ORS 746.600 is amended to read:
746.600. As used in ORS 746.600 to 746.690 and 750.055:
(1) “Adverse underwriting decision” means, except as
provided in subsection (2) of this section, any of the following actions with
respect to insurance transactions involving insurance coverage which is individually
underwritten:
(a) A declination of insurance coverage.
(b) A termination of insurance coverage.
(c) Failure of an agent to apply for insurance coverage
with a specific insurer which the agent represents and which is requested by an
applicant.
(d) In the case of life or health insurance coverage, an
offer to insure at higher than standard rates.
(e) In the case of other kinds of insurance coverage:
(A) Placement by an insurer or agent of a risk with a
residual market mechanism, an unauthorized insurer or an insurer which
specializes in substandard risks.
(B) The charging of a higher rate on the basis of
information which differs from that which the applicant or policyholder
furnished.
(2) “Adverse underwriting decision” does not include the
following actions, but the insurer or agent responsible for the occurrence of
the action shall nevertheless provide the applicant or policyholder with the
specific reason or reasons for the occurrence:
(a) The termination of an individual policy form on a class
or statewide basis.
(b) A declination of insurance coverage solely because the
coverage is not available on a class or statewide basis.
(c) The rescission of a policy.
(3) “Affiliate of” a specified person or “person affiliated
with” a specified person means a person who directly, or indirectly, through
one or more intermediaries, controls, or is controlled by, or is under common
control with, the person specified.
(4) “Agent” means a person licensed by the Director of the
Department of Consumer and Business Services as an insurance agent, or a person
to whom the director has issued a nonresident broker’s permit.
(5) “Applicant” means a person who seeks to contract for
insurance coverage, other than a person seeking group insurance coverage which
is not individually underwritten.
(6) “Consumer report” means any written, oral or other
communication of information bearing on a natural person’s creditworthiness,
credit standing, credit capacity, character, general reputation, personal
characteristics or mode of living which is used or expected to be used in
connection with an insurance transaction.
(7) “Consumer reporting agency” means a person who:
(a) Regularly engages, in whole or in part, in assembling
or preparing consumer reports for a monetary fee;
(b) Obtains information primarily from sources other than
insurers; and
(c) Furnishes consumer reports to other persons.
(8) “Control” means, and the terms “controlled by” or
“under common control with” refer to, the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
a person, whether through the ownership of voting securities, by contract other
than a commercial contract for goods or nonmanagement services, or otherwise,
unless the power of the person is the result of a corporate office held in, or
an official position held with, the controlled person.
(9) “Declination of insurance coverage” means a denial, in
whole or in part, by an insurer or agent of requested insurance coverage.
(10) “Individual” [means
a natural person who]:
(a) Means, for
purposes of ORS 746.600 to 746.690 and 750.055, except as provided in paragraph
(b) of this subsection, a natural person who:
[(a)] (A) In the case of life or health
insurance, is a past, present or proposed principal insured or certificate
holder;
[(b)] (B) In the case of other kinds of
insurance, is a past, present or proposed named insured or certificate holder;
[(c)] (C) Is a past, present or proposed
policyowner;
[(d)] (D) Is a past or present applicant;
[(e)] (E) Is a past or present claimant; or
[(f)] (F) Derived, derives or is proposed to
derive insurance coverage under an insurance policy or certificate which is
subject to ORS 746.600 to 746.690 and 750.055.
(b) Comprises, for
purposes of ORS 746.620, 746.630 and 746.665, and for purposes of terms defined
in this section as those terms are used in ORS 746.620, 746.630 and 746.665,
the following categories of natural persons:
(A) “Consumer,” which
means an individual, or the individual’s representative, who seeks to obtain,
obtains or has obtained an insurance product or service from a licensee that is
to be used primarily for personal, family or household purposes, and about whom
the licensee has personal information.
(B) “Customer,” which
means a consumer who has a continuing relationship with a licensee under which
the licensee provides one or more insurance products or services to the
consumer that are to be used primarily for personal, family or household
purposes.
(11) “Institutional source” means a person or governmental
entity which provides information about an individual to an insurer, agent or
insurance-support organization, other than:
(a) An agent;
(b) The individual who is the subject of the information;
or
(c) A natural person acting in a personal capacity rather
than in a business or professional capacity.
(12) “Insurance-support organization” means, except as
provided in subsection (13) of this section, a person who regularly engages, in
whole or in part, in assembling or collecting information about natural persons
for the primary purpose of providing the information to an insurer or agent for
insurance transactions, including:
(a) The furnishing of consumer reports to an insurer or
agent for use in connection with insurance transactions; and
(b) The collection of personal information from insurers,
agents or other insurance-support organizations for the purpose of detecting or
preventing fraud, material misrepresentation or material nondisclosure in
connection with insurance underwriting or insurance claim activity.
(13) “Insurance-support organization” does not include
insurers, agents, governmental institutions, medical care institutions or
medical professionals.
(14) “Insurance transaction” means any transaction
involving insurance primarily for personal, family or household needs rather
than business or professional needs and which entails:
(a) The determination of an individual’s eligibility for an
insurance coverage, benefit or payment; or
(b) The servicing of an insurance application, policy or
certificate.
(15) “Insurer,” as defined in ORS 731.106, includes every
person engaged in the business of entering into policies of insurance.
(16) “Investigative consumer report” means a consumer
report, or portion of a consumer report, for which information about a natural
person’s character, general reputation, personal characteristics or mode of
living is obtained through personal interviews with the person’s neighbors,
friends, associates, acquaintances or others who may have knowledge concerning
such items of information.
(17) “Licensee”
means an insurer, agent or other person authorized or required to be
authorized, or licensed or required to be licensed, pursuant to the Insurance
Code.
[(17)] (18) “Medical care institution” means a
facility or institution which is licensed to provide health care services to
natural persons, and includes but is not limited to health maintenance
organizations, home health agencies, hospitals, medical clinics, public health
agencies, rehabilitation agencies and skilled nursing facilities.
[(18)] (19) “Medical professional” means a
person licensed or certified to provide health care services to natural
persons, and includes but is not limited to chiropractors, clinical dieticians,
clinical psychologists, dentists, naturopaths, nurses, occupational therapists,
optometrists, pharmacists, physical therapists, physicians, podiatrists,
psychiatric social workers and speech therapists.
[(19)] (20) “Medical record information” means
personal information [which] except age or gender, whether oral or
recorded in any form or medium, created by or derived from a health care
provider or the consumer that relates to:
[(a) Relates to an
individual’s physical or mental condition, medical history or medical
treatment; and]
[(b) Is obtained from
a medical professional, a medical care institution, the individual, or the
individual’s spouse, parent or legal guardian.]
(a) The past,
present or future physical, mental or behavioral health or condition of an
individual;
(b) The provision of
health care to an individual; or
(c) Payment for the
provision of health care to an individual.
(21) “Nonaffiliated
third party” means any person except:
(a) An affiliate of a
licensee;
(b) A person that is
employed jointly by a licensee and by a person that is not an affiliate of the
licensee; and
(c) As designated by the
director by rule.
[(20)] (22) “Personal information” means
information which is identifiable with an individual, which is gathered in
connection with an insurance transaction and from which information judgments
can be made about the individual’s character, habits, avocations, finances,
occupations, general reputation, credit, health or any other personal
characteristics. “Personal information” includes an individual’s name and
address, an individual’s policy number
or similar form of access code for the individual’s policy and “medical
record information” but does not include “privileged information” except for
privileged information which has been disclosed in violation of ORS 746.665. “Personal information” does not include
information that a licensee has a reasonable basis to believe is lawfully made
available to the general public from federal, state or local government
records, widely distributed media or disclosures to the public that are
required by federal, state or local law.
[(21)] (23) “Policyholder” means a person who:
(a) In the case of individual policies of life or health
insurance, is a current policyowner;
(b) In the case of individual policies of other kinds of
insurance, is currently a named insured; or
(c) In the case of group policies of insurance under which
coverage is individually underwritten, is a current certificate holder.
[(22)] (24) “Pretext interview” means an
interview wherein the interviewer, in an attempt to obtain information about a
natural person, does one or more of the following:
(a) Pretends to be someone the interviewer is not.
(b) Pretends to represent a person the interviewer is not
in fact representing.
(c) Misrepresents the true purpose of the interview.
(d) Refuses upon request to identify the interviewer.
[(23)] (25) “Privileged information” means
information which is identifiable with an individual and which:
(a) Relates to a claim for insurance benefits or a civil or
criminal proceeding involving the individual; and
(b) Is collected in connection with or in reasonable
anticipation of a claim for insurance benefits or a civil or criminal
proceeding involving the individual.
[(24)] (26) “Residual market mechanism” means
an association, organization or other entity involved in the insuring of risks
under ORS 735.005 to 735.145, 737.312 or other provisions of the Insurance Code
relating to insurance applicants who are unable to procure insurance through
normal insurance markets.
[(25)] (27) “Termination of insurance
coverage” or “termination of an insurance policy” means either a cancellation
or a nonrenewal of an insurance policy, in whole or in part, for any reason
other than the failure of a premium to be paid as required by the policy.
SECTION 26.
ORS 746.620 is amended to read:
746.620. (1) [An
insurer or agent] A licensee
shall provide a clear and conspicuous
notice of information practices to [all
applicants or policyholders] individuals
in connection with insurance transactions under the circumstances and at the
times as follows:
[(a) In the case of
an application for insurance, a notice shall be provided no later than:]
[(A) At the time of
delivery of the insurance policy or certificate, if personal information is
collected only from the applicant or from public records; or]
[(B) At the time the
collection of personal information is initiated, if personal information is
collected from a source other than the applicant or public records.]
[(b) In the case of a
policy renewal, a notice shall be provided no later than the policy renewal
date, except that no notice shall be required in connection with a policy
renewal if:]
[(A) Personal
information is collected only from the policyholder or from public records; or]
[(B) A notice meeting
the requirements of this section has been given within the previous 24 months.]
[(c) In the case of a
policy reinstatement or change in insurance benefits, a notice shall be
provided no later than the time a request for the policy reinstatement or
change in insurance benefits is received by the insurer, except that no notice
shall be required if personal information is collected only from the
policyholder or from public records.]
[(2) The notice
required by subsection (1) of this section shall be in writing and shall state:]
[(a) Whether personal
information may be collected from persons other than the individual or
individuals proposed for coverage;]
[(b) The types of
personal information which may be collected and the types of sources and
investigative techniques which may be used to collect the information;]
[(c) The types of
disclosures identified in ORS 746.665 (1)(b) to (f), (i), (k), (L) and (n) and
the circumstances under which these disclosures may be made without prior
authorization. However, only those circumstances need be described which occur
with such frequency as to indicate a general business practice;]
[(d) A description of
the rights established under ORS 746.640 and 746.645 and the manner in which
such rights may be exercised; and]
[(e) That information
obtained from a report prepared by an insurance-support organization may be
retained by the insurance-support organization and disclosed to other persons.]
(a) Except as provided
in this paragraph, to a consumer who becomes a customer of the licensee, not
later than the date that the licensee establishes a continuing relationship
under which the licensee provides one or more insurance products or services to
the consumer that are to be used primarily for personal, family or household
purposes. A licensee may provide the notice within a reasonable time after the
date the licensee establishes a customer relationship if:
(A) Establishing the
customer relationship is not at the customer’s election; or
(B) Providing notice not
later than the date that the licensee establishes a customer relationship would
substantially delay the customer’s transaction and the customer agrees to
receive the notice at a later time.
(b) To a consumer other
than as described in paragraph (a) of this subsection, before the licensee
discloses any personal information about the consumer pursuant to the
requirements of ORS 746.665, unless the disclosure meets one or more of the
conditions specified in ORS 746.665.
(2) A licensee shall
provide a clear and conspicuous notice to a customer that accurately reflects
the privacy policies and practices not less than annually during the
continuation of the relationship described in subsection (1)(a) of this
section. For the purpose of this subsection, a notice is given annually if it
is given at least once in any period of 12 consecutive months during which the
relationship exists. A licensee may define the period of 12 consecutive months,
but the licensee must apply the period to the customer on a consistent basis.
(3) The privacy notice
required by subsections (1) and (2) of this section shall be in writing and
clear and conspicuous. The notice may be provided in electronic form if the
recipient agrees. In addition to any other information the licensee wishes to provide,
the notice shall include the following items of information that apply to the
licensee and to the individuals to whom the licensee sends the notice:
(a) The categories of
personal information that the licensee collects.
(b) The categories of
personal information that the licensee discloses.
(c) The categories of
affiliates and nonaffiliated third parties to whom the licensee discloses
personal information other than persons to whom the licensee discloses
information under ORS 746.665.
(d) The categories of
personal information about former customers of the licensee that the licensee
discloses and the categories of affiliates and nonaffiliated third parties to
whom the licensee discloses personal information about the licensee’s former
customers, other than persons to whom the licensee discloses information under
ORS 746.665.
(e) If a licensee
discloses personal information to a nonaffiliated third party under ORS
746.665, a separate description of the categories of information the licensee
discloses and the categories of nonaffiliated third parties with whom the
licensee has contracted.
(f) An explanation of
the individual’s right under ORS 746.630 to authorize disclosure of personal
information, including the methods by which the individual may exercise that
right.
(g) Any disclosure that
the licensee makes under section 603(d)(2)(A)(iii) of the federal Fair Credit
Reporting Act (15 U.S.C. 1681a(d)(2)(A)(iii)) regarding the ability to opt out
of disclosures of information among affiliates.
(h) The policies and
practices of the licensee with respect to protecting the confidentiality and
security of personal information.
(i) Any disclosure that
the licensee makes under subsection (4) of this section.
(j) A description of the
rights established under ORS 746.640 and 746.645 and the manner in which such
rights may be exercised.
(4) If a licensee
discloses personal information as authorized under ORS 746.665, the licensee
need not list those exceptions in the privacy notices required by this section.
When describing the categories of parties to whom disclosure is made, the licensee
must state only that the licensee makes disclosures to other affiliated parties
or nonaffiliated third parties, as applicable, as authorized by law.
[(3)] (5) In lieu of the notice prescribed in
subsection [(2)] (3) of this section, the [insurer
or agent] licensee may provide to a consumer an abbreviated notice, in writing or in electronic form if the
consumer agrees, informing the [applicant
or policyholder] consumer that:
(a) Personal information may be collected from persons
other than the [individual or individuals]
consumer proposed for coverage;
(b) Such information as well as other personal or
privileged information subsequently collected by the [insurer or agent] licensee
may in certain circumstances be disclosed to third parties without
authorization;
(c) A right of access and correction exists with respect to
all personal information collected; and
(d) The notice prescribed in subsection [(2)] (3) of this section will be furnished to the [applicant or policyholder] consumer
upon request.
(6) The Director of
the Department of Consumer and Business Services by rule may apply the
categories of consumer and customer as described in ORS 746.600 for the purpose
of establishing specific requirements for notice of information practices,
authorization for disclosure of personal information, conditions for disclosure
of personal information under this section and ORS 746.630 and 746.665, and
exceptions. The director shall consider applicable definitions and terms used
in the federal Gramm-Leach-Bliley Act (P.L. 106-102), applicable definitions
and requirements used in the model “Privacy of Consumer Financial and Health
Information Regulation” adopted by the National Association of Insurance
Commissioners and other sources as may be needed so that the terms defined in
ORS 746.600 and applicable to this section and ORS 746.630 and 746.665:
(a) Facilitate
compliance with requirements in federal law and the laws of other states that
establish protections of nonpublic personal information; and
(b) Establish separate
and discrete requirements relating to the privacy notice and its contents and
delivery for customers and consumers, so that the requirements provide
reasonable notice and facilitate compliance with requirements in federal law
and in the laws of other states.
(7) The director shall
determine by rule:
(a) When a privacy
notice must be provided to a certificate holder or beneficiary of a group
policy and to a third-party claimant.
(b) When the obligation
to provide annual notice ceases.
(c) Requirements for
revision of the notice by a licensee.
(8) An agent is not
subject to the requirements of this section when the insurer on whose behalf
the agent acts otherwise complies with the requirements of this section and the
agent does not disclose any personal information to any person other than the
insurer or its affiliate, or as otherwise authorized by law.
(9) A licensee may
provide a joint notice from the licensee and one or more of its affiliates or
other financial institutions, as identified in the notice, as long as the
notice is accurate with respect to the licensee and the other institutions. A
licensee may also provide a notice on behalf of a financial institution.
[(4)] (10) The obligations imposed by this
section upon [an insurer or agent] a licensee may be satisfied by another
[insurer or agent] licensee authorized to act on behalf of
the first [insurer or agent] licensee.
(11) For purposes of
this section and ORS 746.630 and 746.665, an individual is not the consumer of
a licensee solely because the individual is covered under a group life or
health insurance policy issued by the licensee or is a participant or
beneficiary of an employee benefit plan that the licensee administers or
sponsors or for which the licensee acts as a trustee, insurer or fiduciary, if:
(a) The licensee
provides to the policyholder the initial, annual and revised notices under this
section; and
(b) The licensee does
not disclose to a nonaffiliated third party personal information about the
individual other than as permitted by ORS 746.665.
(12) When an individual
becomes a consumer of a licensee under subsection (11) of this section, this
section and ORS 746.630 and 746.665 apply to the licensee with respect to the
individual.
SECTION 27.
ORS 746.630 is amended to read:
746.630. (1) Notwithstanding any other law of this state, [no insurer, agent] a licensee or insurance-support organization may not utilize as its disclosure
authorization form in connection with insurance transactions a form or
statement which authorizes the disclosure of personal or privileged information
about an individual to the [insurer,
agent] licensee or insurance-support
organization unless the form or statement
is clear and conspicuous, and contains all of the following:
[(a) Is written in
plain language;]
[(b) Is dated;]
[(c) Specifies the
types of persons authorized to disclose information about the individual;]
[(d) Specifies the
nature of the information authorized to be disclosed;]
[(e) Names the
insurer or agent and identifies by generic reference the representatives of the
insurer to whom the individual is authorizing information to be disclosed;]
[(f) Specifies the
purposes for which the information is collected;]
[(g) Specifies the
length of time such authorization will remain valid, which shall be no longer
than:]
[(A) In the case of
authorizations signed for the purpose of collecting information in connection
with an application for an insurance policy, a policy reinstatement or a
request for change in policy benefits:]
[(i) Thirty months
from the date the authorization is signed if the application or request
involves life or health insurance; or]
[(ii) Twelve months
from the date the authorization is signed if the application or request
involves other kinds of insurance.]
[(B) In the case of
authorizations signed for the purpose of collecting information in connection
with a claim for benefits under an insurance policy:]
[(i) The term of
coverage of the policy and the duration of any claim extending after the term
of coverage if the claim is for a health insurance benefit; or]
[(ii) The duration of
the claim if the claim is not for a health insurance benefit; and]
[(h) Advises the
individual or a person authorized to act on behalf of the individual that the
individual or the individual’s authorized representative is entitled to receive
a copy of the authorization form.]
(a) The identity of
the individual who is the subject of the personal information.
(b) A general
description of the categories of personal information to be disclosed.
(c) General descriptions
of the parties to whom the licensee discloses personal information, the purpose
of the disclosure and how the information will be used.
(d) The signature of the
individual who is the subject of the personal information or the individual who
is legally empowered to grant authority and the date signed.
(e) Notice of the length
of time for which the authorization is valid, that the individual may revoke
the authorization at any time and the procedure for making a revocation.
(2) An authorization may
not remain valid for more than 24 months.
(3) An individual who is
the subject of personal information may revoke an authorization provided
pursuant to this section at any time, subject to the rights of any individual
who acted in reliance on the authorization prior to notice of the revocation.
(4) A licensee shall
retain the authorization of an individual or a copy thereof in the record of
the individual who is the subject of the personal information.
[(2)] (5) A disclosure authorization obtained
by an insurer, agent or insurance-support organization from an individual prior
to January 1, 1983, shall be considered to be in compliance with this section.
SECTION 27a.
(1) The amendments to ORS 746.620 and
746.630 by sections 26 and 27 of this 2001 Act apply on and after July 1, 2003,
to an insurer with respect to health insurance policies issued by the insurer
to which the federal Health Insurance Portability and Accountability Act of
1996 (P.L. 104-191) applies. The Director of the Department of Consumer and
Business Services may adopt rules that take effect on or after July 1, 2003, with
respect to such policies. The rules may:
(a) Apply the
requirements of federal regulations governing privacy adopted under the
authority of the federal Health Insurance Portability and Accountability Act of
1996 if the requirements of the federal regulations are more stringent than the
requirements of ORS 746.620 and 746.630 as amended by sections 26 and 27 of
this 2001 Act; or
(b) Apply the
requirements of ORS 746.620 and 746.630 as amended by sections 26 and 27 of
this 2001 Act.
(2) Nothing in this
section may be construed to exempt an insurer transacting health insurance from
other applicable requirements in state or federal law concerning the use of
personal information in insurance transactions.
(3) The director shall
determine under subsection (1) of this section whether the requirements of the
federal regulations are more stringent than the requirements of ORS 746.620 and
746.630 as amended by sections 26 and 27 of this 2001 Act on the basis of the
federal regulations as a whole. If the director determines that the federal
regulations with respect to a particular matter are less stringent than the
requirements of ORS 746.620 and 746.630 as amended by sections 26 and 27 of
this 2001 Act, the director may require compliance with the state law on that
matter.
SECTION 28.
ORS 746.665 is amended to read:
746.665. (1) [An
insurer, agent] A licensee or
insurance-support organization shall not disclose any personal or privileged
information about an individual collected or received in connection with an
insurance transaction unless the disclosure meets one or more of the following
conditions:
(a) Is with the written authorization of the individual,
and:
(A) If the authorization is submitted by another [insurer, agent] licensee or insurance-support organization, the authorization meets
the requirements of ORS 746.630; or
(B) If the authorization is submitted by a person other
than [an insurer, agent] a licensee or insurance-support
organization, the authorization is:
(i) Dated;
(ii) Signed by the individual; and
(iii) Obtained one year or less prior to the date a
disclosure is sought pursuant to this subsection.
(b) Is to a person other than [an insurer, agent] a
licensee or insurance-support organization, if the disclosure is reasonably
necessary to enable the person to:
(A) Perform a business, professional or insurance function
for the disclosing [insurer, agent] licensee or insurance-support
organization and the person agrees not to disclose the information further
without the individual’s written authorization unless the further disclosure:
(i) Would otherwise be permitted by this section if made by
[an insurer, agent,] a licensee or insurance-support
organization; or
(ii) Is reasonably necessary for the person to perform its
function for the disclosing [insurer,
agent] licensee or
insurance-support organization; or
(B) Provide information to the disclosing [insurer, agent] licensee or insurance-support organization for the purpose of:
(i) Determining an individual’s eligibility for an insurance
benefit or payment; or
(ii) Detecting or preventing criminal activity, fraud,
material misrepresentation or material nondisclosure in connection with an
insurance transaction.
(c) Is to [an
insurer, agent] a licensee,
insurance-support organization or self-insurer, if the information disclosed is
limited to that which is reasonably necessary:
(A) To detect or prevent criminal activity, fraud, material
misrepresentation or material nondisclosure in connection with insurance
transactions; or
(B) For either the disclosing or receiving [insurer, agent] licensee or insurance-support organization to perform its function
in connection with an insurance transaction involving the individual.
(d) Is to a medical care institution or medical
professional and discloses only such information as is reasonably necessary to
accomplish one or more of the following purposes:
(A) Verifying insurance coverage or benefits.
(B) Informing an individual of a medical problem of which
the individual may not be aware.
(C) Conducting an operations or services audit.
(e) Is to an insurance regulatory authority.
(f) Is to a law enforcement or other governmental
authority:
(A) To protect the interests of the [insurer, agent] licensee or
insurance-support organization in preventing or prosecuting the perpetration of
fraud upon it; or
(B) If the [insurer,
agent] licensee or
insurance-support organization reasonably believes that illegal activities have
been conducted by the individual.
(g) Is otherwise permitted or required by law.
(h) Is in response to a facially valid administrative or
judicial order, including a search warrant or subpoena.
(i) Is made for the purpose of conducting actuarial or
research studies, if:
(A) No individual may be identified in any resulting
actuarial or research report;
(B) Materials allowing the individual to be identified are
returned or destroyed as soon as they are no longer needed; and
(C) The actuarial or research organization agrees not to
disclose the information unless the disclosure would otherwise be permitted by
this section if made by [an insurer,
agent] a licensee or
insurance-support organization.
(j) Is to a party or a representative of a party to a
proposed or consummated sale, transfer, merger or consolidation of all or part
of the business of the [insurer, agent]
licensee or insurance-support
organization, if:
(A) Prior to the consummation of the sale, transfer, merger
or consolidation only such information is disclosed as is reasonably necessary
to enable the recipient to make business decisions about the purchase,
transfer, merger or consolidation; and
(B) The recipient agrees not to disclose the information
unless the disclosure would otherwise be permitted by this section if made by [an insurer, agent] a licensee or insurance-support organization.
(k) Is to a [person]
nonaffiliated third party whose only
use of the information will be in connection with the marketing of a product or
service, if all of the following
conditions are met:
(A) No medical record information, privileged information
or personal information relating to an individual’s character, personal habits,
mode of living or general reputation is disclosed, and no classification
derived from such information [is
disclosed;] may be disclosed.
(B) The individual [has]
must have been given the notice described in ORS 746.620 and
an opportunity to indicate that the individual does not want personal
information disclosed for marketing purposes and [has] must have given no
indication that the individual does not want the information disclosed[; and]. The individual need not have been given the opportunity described in
this subparagraph if the disclosure is made pursuant to a joint marketing
agreement. As used in this subparagraph, “joint marketing agreement” means a
formal written contract pursuant to which an insurer jointly offers, endorses
or sponsors a financial product or service with a financial institution. When
the opportunity is required, the statement that offers the opportunity must
state that the insurer may disclose personal information to nonaffiliates and
that the individual has a right to indicate that the individual does not want
personal information disclosed for marketing purposes, and must describe the
method for exercising that right. The statement must be in writing but may be
in an electronic form if the individual agrees. The individual who is given the
opportunity must be provided a reasonable time to exercise the opportunity. An
individual may exercise the opportunity at any time. A statement by an
individual barring disclosure of personal information remains effective until
the individual who made the statement revokes the statement in writing or, if
the individual agrees, in electronic form.
(C) The person receiving the information [agrees] must agree not to use it except in connection with the marketing of
a product or service.
(L) Is to an affiliate whose only use of the information
will be in connection with an audit of the [insurer
or agent] licensee or the
marketing of [an insurance] a financial product or service, and the
affiliate agrees not to disclose the information for any other purpose or to
unaffiliated persons. This paragraph
does not apply to the disclosure of medical record information for the purpose
of marketing a financial product or service.
(m) Is by a consumer reporting agency, and the disclosure
is to a person other than [an insurer or
agent] a licensee.
(n) Is to a group policyholder for the purpose of reporting
claims experience or conducting an audit of the [insurer’s or agent’s] licensee’s
operations or services, and the information disclosed is reasonably necessary
for the group policyholder to conduct the review or audit.
(o) Is to a professional peer review organization for the
purpose of reviewing the service or conduct of a medical care institution or
medical professional.
(p) Is to a governmental authority for the purpose of
determining the individual’s eligibility for health benefits for which the
governmental authority may be liable.
(q) Is to a policyholder or certificate holder for the
purpose of providing information regarding the status of an insurance
transaction.
(2) Personal or privileged information may be acquired by a
group practice prepayment health care service contractor from providers which
contract with the contractor and may be transferred among providers which
contract with the contractor for the purpose of administering plans offered by
the contractor. The information may not be disclosed otherwise by the
contractor except in accordance with ORS 746.600 to 746.690 and 750.055.
SECTION 28a.
ORS 746.680 is amended to read:
746.680. (1) If any insurer, agent or insurance-support
organization fails to comply with ORS 746.640, 746.645 or 746.650, any person
whose rights granted under those sections are violated may apply to the circuit
court for the county in which the person resides, or any other court of
competent jurisdiction, for appropriate equitable relief.
(2) [An insurer,
agent] A licensee or
insurance-support organization [which]
that discloses information in
violation of ORS 746.665 shall be liable for damages sustained by the
individual about whom the information relates. However, no individual shall be
entitled to a monetary award [which] that exceeds the actual damages
sustained by the individual as a result of the violation of ORS 746.665.
(3) In any action brought pursuant to this section, the
court may award the cost of the action and reasonable attorney fees to the
prevailing party.
(4) An action under this section must be brought within two
years from the date the alleged violation is or should have been discovered.
(5) Except as specifically provided in this section, there
shall be no remedy or recovery available to individuals, in law or in equity,
for occurrences constituting a violation of any provision of ORS 746.600 to
746.690 and 750.055.
SECTION 28b.
Section 28c of this 2001 Act is added to
and made a part of ORS 746.600 to 746.690.
SECTION 28c.
Nothing in ORS 746.620, 746.630 or
746.665 may be construed to modify, limit or supersede the operation of the
federal Fair Credit Reporting Act (15 U.S.C. 1681 et seq.) and no inference may
be drawn on the basis of ORS 746.620, 746.630 or 746.665 regarding whether
information is transaction information or experience information under section
603 of the federal Fair Credit Reporting Act (15 U.S.C. 1681 et seq.).
SECTION 29.
ORS 706.008 is amended to read:
706.008. As used in the Bank Act, unless the context
requires otherwise:
(1) “Bank” means a company, other than an extranational
institution, that accepts deposits insured to any extent by the Bank Insurance
Fund under the provisions of the Federal Deposit Insurance Act, as amended, 12
U.S.C. 1811, et seq.
(2) “Bank holding company” means any company that is a bank
holding company under the federal Bank Holding Company Act of 1956, as amended,
12 U.S.C. 1841, et seq.
(3) “Bank service corporation” means a corporation, all of
the capital stock of which is owned by one or more banking institutions or
national banks, that is organized to perform services authorized by ORS
708A.145.
(4) “Banking institution” means an Oregon commercial bank,
an Oregon trust company or an Oregon savings bank.
(5) “Company” means an entity that is a company under the
federal Bank Holding Company Act of 1956, as amended, 12 U.S.C. 1841, et seq.
(6) “Extranational institution” means a corporation,
unincorporated company, partnership or association of two or more persons
organized under the laws of a nation other than the United States, any territory
of the United States, Puerto Rico, Guam, American Samoa or the Virgin Islands,
that engages directly in a banking business.
(7) “Federal bank” means a national bank or any other bank
organized under the laws of the United States.
(8) “Federal savings bank” means a corporation chartered as
a federal savings bank under the provisions of 12 U.S.C. 1464.
(9) “Financial
holding company” means a company as referred to in section 103 of the federal
Gramm-Leach-Bliley Act (P.L. 106-102).
[(9)] (10) “Financial institution” means
insured institutions, extranational institutions, credit unions as defined in
ORS 723.006, out-of-state credit unions under ORS 723.042 and federal credit
unions.
[(10)] (11) “In-state federal stock bank”
means a federal bank that issues capital stock, the home state of which is
Oregon.
[(11)] (12) “Institution” means an Oregon
commercial bank or an Oregon trust company.
[(12)] (13) “Insured institution” means a
company, the deposits of which are insured under the provisions of the Federal
Deposit Insurance Act, as amended, 12 U.S.C. 1811, et seq.
[(13)] (14) “Insured nonstock institution”
means an insured institution that does not issue capital stock.
[(14)] (15) “Insured stock institution” means
an insured institution that issues capital stock.
[(15)] (16) “National bank” means a bank that
was organized under the provisions of the National Bank Act, as amended, 12
U.S.C. 21, et seq.
[(16)] (17) “Non-Oregon institution” means:
(a) An out-of-state state bank engaging in banking business
in Oregon;
(b) An out-of-state trust company transacting trust
business in Oregon; and
(c) An extranational institution engaging in banking
business in Oregon.
[(17)] (18) “Nonstock bank” means a bank that
does not issue capital stock.
[(18)] (19) “Oregon bank” means an Oregon
stock bank or Oregon nonstock bank.
[(19)] (20) “Oregon commercial bank” means an
Oregon stock bank that was chartered under ORS chapter 707 as a bank other than
a stock savings bank.
[(20)] (21) “Oregon nonstock bank” means a
state nonstock bank, the home state of which is Oregon.
[(21)] (22) “Oregon operating institution”
means:
(a) A bank that is engaging in banking business in this
state;
(b) An extranational institution that is engaging in
banking business in this state; or
(c) A trust company that is transacting trust business in
this state.
[(22)] (23) “Oregon savings bank” or “savings
bank” means an Oregon stock savings bank or an Oregon nonstock bank.
[(23)] (24) “Oregon stock bank” means a state
stock bank, the home state of which is Oregon.
[(24)] (25) “Oregon stock savings bank” means
an Oregon stock bank that was initially chartered as or was converted to a
stock savings bank under the Bank Act.
[(25)] (26) “Oregon trust company” means a
trust company that was organized under the provisions of ORS chapter 707.
[(26)] (27) “Out-of-state bank” means an
out-of-state state bank or an out-of-state federal bank.
[(27)] (28) “Out-of-state bank holding
company” means a bank holding company whose home state is not Oregon, and that
is not the bank holding company of an Oregon stock bank or an in-state federal
stock bank.
[(28)] (29) “Out-of-state federal bank” means
a federal bank, the home state of which is a state other than Oregon.
(30) “Out-of-state
financial holding company” means a financial holding company whose home state
is not Oregon, and that is not the financial holding company of an Oregon stock
bank or an in-state federal stock bank.
[(29)] (31) “Out-of-state state bank” means a
state bank, the home state of which is a state other than Oregon.
[(30)] (32) “Out-of-state trust company” means
a trust company that was organized under the laws of another state.
[(31)] (33) “State bank” means a bank that was
organized under the laws of a state.
[(32)] (34) “State nonstock bank” means a
nonstock bank that was organized under the laws of a state.
[(33)] (35) “State stock bank” means a stock
bank that was organized under the laws of a state.
[(34)] (36) “Stock bank” means a bank that
issues capital stock.
[(35)] (37) “Trust company” means any company
that is authorized under the provisions of ORS chapter 709 to transact trust
business, and includes the trust department of a bank, but does not include a
corporation appointed by a United States Bankruptcy Court to serve as a
bankruptcy trustee under Title 11, United States Code, when the corporation is
acting in its capacity as a bankruptcy trustee.
SECTION 30.
ORS 715.012 is amended to read:
715.012. (1) If a company proposes to become a financial holding company or a bank
holding company of an Oregon stock bank, when the company files its application
and any related materials with the Federal Reserve Board, the company shall
submit to the Director of the Department of Consumer and Business Services
copies of the application and related materials.
(2) The director may submit comments and recommendations
for approval or disapproval to the Federal Reserve Board concerning any
application to become a financial
holding company or a bank holding company of an Oregon stock bank that is
filed with the Federal Reserve Board.
(3) Following the filing of an application to become a financial holding company or a bank
holding company and the submission to the director of the materials described
in subsection (1) of this section, the company shall submit to the director
copies of any written communications between itself and the Federal Reserve
Board that relate to the application, including copies of any written approval
or denial of the application. A copy of each such written communication shall
be submitted to the director within 10 days after the original thereof is sent
or received by the company.
SECTION 31.
ORS 715.017 is amended to read:
715.017. An out-of-state financial holding company or an out-of-state bank holding company
may become the financial holding company
or the bank holding company of:
(1) An Oregon stock bank or an in-state federal stock bank,
by itself or together with any predecessor, only if the Oregon stock bank or
in-state federal stock bank has been engaged in the business of banking in this
state for a period of not less than three years prior to the date on which the
out-of-state financial holding company
or the out-of-state bank holding company becomes the financial holding company or the bank holding company of the Oregon
stock bank or in-state federal stock bank.
(2) An Oregon stock bank organized under ORS 707.025 that
has merged with or acquired all or substantially all of the assets and
liabilities of an Oregon stock bank or in-state federal stock bank, by itself
or together with any predecessor, only if the Oregon stock bank or in-state
federal stock bank has been engaged in the business of banking in this state
for a period of not less than three years prior to the date on which the
out-of-state financial holding company
or the out-of-state bank holding company becomes the financial holding company or the bank holding company of the
Oregon stock bank.
SECTION 32.
ORS 715.019 is amended to read:
715.019. (1) An Oregon nonstock bank may, pursuant to rules
adopted by the Director of the Department of Consumer and Business Services,
reorganize so that the resulting entities are an Oregon stock savings bank,
controlled by a mutual financial holding
company or a mutual bank holding company. For purposes of this section, a
“mutual financial holding company or a
mutual bank holding company” is a financial
holding company or a bank holding company that does not issue capital
stock. The mutual financial holding
company shall be mutually owned by the depositors of the reorganizing Oregon
nonstock bank and shareholders of other companies under the control of the
mutual financial holding company. The mutual bank holding company shall be
mutually owned by the depositors of the reorganizing Oregon nonstock bank.
(2) A mutual bank holding company may acquire or invest in
the stock of one or more stock savings banks.
(3) A mutual bank holding company may merge with or acquire
another mutual bank holding company.
(4) A mutual bank holding company formed under this section
shall be subject to the provisions of this chapter.
(5) The director is authorized to adopt rules to carry out
the provisions of this section.
SECTION 33.
ORS 715.045 is amended to read:
715.045. (1) The Director of the Department of Consumer and
Business Services may examine the books, accounts, records and files of a financial holding company or a bank
holding company of an Oregon stock bank when the director considers it
necessary to evaluate the condition of the Oregon stock bank that is a
subsidiary of the financial holding
company or the bank holding company.
(2) The financial
holding company or the bank holding company examined shall pay to the
director the actual cost of the examination, as determined by the director.
SECTION 34.
ORS 715.055 is amended to read:
715.055. (1) A financial
holding company or a bank holding company of an Oregon stock bank shall
submit to the Director of the Department of Consumer and Business Services
copies of all reports that the financial
holding company or the bank holding company is required to submit to the
Federal Reserve Board. The copies shall be submitted to the director within the
time periods required by applicable federal law and regulation for the filing
of the originals with the Federal Reserve Board.
(2) The director may call for additional information from a
financial holding company or a bank
holding company, in such form as the director may prescribe by rule or order,
if the director considers it necessary in order to obtain full knowledge of the
condition of the Oregon stock bank which the financial holding company or the bank holding company controls. The
financial holding company or the
bank holding company shall submit the report to the director within the time
period prescribed by the director.
(3) If a financial
holding company or a bank holding company fails to submit a report or
additional information as required by this section, the financial holding company or the bank holding company shall pay to
the director a penalty of up to $1,000 for each day it fails to comply. If the financial holding company or the bank
holding company delays or refuses to pay the penalty upon demand by the
director, the director may maintain an action in the director’s name against
the delinquent financial holding company
or bank holding company for the recovery of the penalty.
SECTION 35.
ORS 715.075 is amended to read:
715.075. A financial
holding company or a bank holding company may acquire and hold all or part
of the stock of a corporation which is or may thereafter be licensed under ORS
744.002 as an agent to transact one or more of the classes of insurance
described in ORS 744.115 except for title insurance, subject to the following
requirements:
(1) The acquisition and holding of such stock shall be
subject to the approval of the Director of the Department of Consumer and
Business Services. The director shall base consideration for approval on the
condition of the financial holding
company or the bank holding company, the adequacy of a formal business plan
for the insurance activities and the existence of satisfactory management for
the corporation.
(2) The director may revoke or restrict the ongoing
authority of the financial holding
company or the bank holding company to hold stock in the corporation if the
condition of the financial holding
company or the bank holding company or of any bank owned by it
substantially deteriorates or if the insurance activities are adversely
affecting the financial holding company
or the bank holding company or any bank owned by it.
(3) If the corporation conducts the insurance agency
activity in any branch or office in which any bank owned by the financial holding company or the bank
holding company carries on its banking business, the insurance agency activity
shall be physically separated from those parts of the premises in which the
bank carries on the banking business.
(4) No person who acts on behalf of the corporation to
transact insurance, as that term is defined in ORS 731.146, shall while
employed by the corporation engage on behalf of the financial holding company or the bank holding company or any bank
owned by it in any activities relating to the making of loans or the granting
of other credits to the customers of any bank owned by the financial holding company or the bank holding company, including
but not limited to serving as a loan officer or as a member of a loan committee
or any other group charged with approval of loans and other credits.
(5) The name of the corporation and any assumed business
name used by it shall not be identical to that of any bank owned by the financial holding company or the bank
holding company.
(6) Prior to selling any policy of insurance, the
corporation shall give substantially the following notice in writing to the
purchaser in at least 10-point boldfaced type:
______________________________________________________________________________
NOTICE
________________ (Name of corporation licensed as an agent)
is owned by ______ (Name of financial holding
company or bank holding company) which also owns ________ (Name of
institution or savings bank). You are not required to purchase any insurance
from it as a condition of obtaining any service from or engaging in any
transaction with the institution, savings bank, financial holding company or bank holding company. Before
committing to purchase any policy of insurance, you should shop for the
coverage by carefully comparing information obtained from two or more agents on
prices, benefits, services, terms of renewal and other policy features. You
hereby acknowledge receipt of a copy of this notice.
_______________ _____________
Customer’s signature Date
______________________________________________________________________________
(7) For each calendar year during which a financial holding company or a bank
holding company owns all or part of any corporation licensed under ORS 744.002
as an agent, the financial holding
company or the bank holding company shall file a written report with the
director. The report shall be filed no later than March 31 of the following
year and shall disclose the insurance activities of the corporation. The
required contents of the report shall be established by the director by rule.
The reports filed with the director under this paragraph shall be available for
public inspection in the office of the director.
(8) The corporation shall not in any manner use customer
information obtained by the institution from another insurance agent to
promote, develop or solicit insurance business for the corporation unless the
other insurance agent consents to such use of the customer information.
(9) The corporation shall be subject to the limitations
applicable to lending institutions under ORS 746.180 and 746.185 to 746.211.
For the purpose of this subsection, the term “lending institution” has the
meaning set forth in ORS 746.185.
SECTION 36.
ORS 715.090 is amended to read:
715.090. (1) A financial
holding company or bank holding company may share financial and credit
information concerning its customers with any company of which it directly or
indirectly controls 50 percent or more of the voting shares. Any company so
controlled by a financial holding
company or bank holding company may share information concerning its
customers with the financial holding
company or bank holding company and with any other company so controlled by
the same financial holding company or
bank holding company. This section shall not be construed as otherwise
permitting or limiting the sharing or disclosure of information.
(2) For purposes of this section, “customers” includes but
is not limited to depositors, borrowers, credit card holders, lessees,
purchasers under contracts and applicants for credit.
SECTION 37.
ORS 732.528 is amended to read:
732.528. (1) Except
as provided in this subsection, the Director of the Department of Consumer
and Business Services shall approve the proposed activity described in ORS
732.521 (1) within 30 days after filing of the completed statement or, if a
hearing is called and held, within 30 days after the record for the hearing is
closed, unless the director finds that any of the [following applies] grounds
specified in this subsection apply to the proposed activity. If a proposed activity described in ORS
732.521 (1) involves a financial holding company or is otherwise subject to the
federal Gramm-Leach-Bliley Act (P.L. 106-102), the director shall approve the
activity not later than the 60th day before the effective date of the activity
unless the director finds that any of the grounds specified in this subsection
apply to the proposed activity. The grounds upon which the director may refuse
to approve a proposed activity are as follows:
(a) The activity is contrary to law or would result in a
prohibited combination of risks or classes of insurance.
(b) The activity is inequitable or unfair to the
policyholders or shareholders of any insurer involved or to any other person
affected by the proposed activity. However, in connection with an acquisition
of the voting securities of an insurer from the shareholders of the insurer,
the director shall evaluate the fairness of the proposed acquisition to the
shareholders of the insurer to be acquired only with respect to any
shareholders remaining after consummation of the acquisition who are
unaffiliated with the acquiring party or parties.
(c) The activity would substantially reduce the security of
and service to be rendered to policyholders of any domestic insurer involved,
or would otherwise prejudice the interests of such policyholders in this state
or elsewhere.
(d) The activity provides for a foreign or alien insurer to
be an acquiring party, and the director further finds that the insurer cannot
satisfy the requirements of this state for transacting an insurance business
involving the classes of insurance affected by the activity.
(e) The activity or its consummation would substantially
lessen competition in insurance in this state or tend to create a monopoly.
(f) After the change of control or ownership, the domestic
insurer to which the activity described in ORS 732.521 (1) applies would not be
able to satisfy the requirements for the issuance of a certificate of authority
to transact the line or lines of insurance for which it is currently
authorized.
(g) The financial condition of any acquiring party might
jeopardize the financial stability of the insurer.
(h) The plans or proposals that the acquiring party has to
liquidate the insurer, sell its assets or consolidate or merge it with any
person, or to make any other material change in its business or corporate
structure or management, are unfair and unreasonable to policyholders of the
insurer and not in the public interest.
(i) The competence, experience and integrity of those
persons who would control the operation of the insurer are such that it would
not be in the interest of policyholders of the insurer and of the public to
permit the activity or its consummation.
(j) The activity or its consummation is likely to be
hazardous or prejudicial to the insurance-buying public.
(k) The activity is subject to other material and
reasonable objections.
(2) If the director does not approve the proposed activity,
the director shall promptly notify each insurer and each acquiring party to the
proposed activity in writing, specifying the bases, factors and reasons for the
disapproval and giving each insurer and each acquiring party who filed the
statement relating to the proposed activity an opportunity to amend the
statement, if possible, to obviate the director’s objections.
(3) Any amendment to the statement filed under ORS 732.523
pursuant to the director’s objection shall be filed by the acquiring party or
parties filing the statement and, if a hearing was held on the proposed
activity, shall be resubmitted at a hearing held pursuant to this section
unless the director finds that such a hearing is not necessary for the
protection of the policyholders, shareholders or any other person affected by
the proposed activity.
(4) The director may retain at the acquiring person’s
expense any actuaries, accountants and other experts not otherwise a part of
the director’s staff as may be reasonably necessary to assist the director in
reviewing the proposed activity.
(5) The director may establish the effective date of an
activity to which ORS 732.521 (1) applies in the order approving the activity.
(6) Any insurer or other party to a proposed activity,
including the insurer proposed to be acquired, within 60 days after receipt of
a notice of approval or disapproval, may appeal the final order of the director
as provided in ORS 183.310 to 183.550. For purposes of the judicial review the
specifications required to be set forth in the written notice from the director
shall be deemed the findings of fact and conclusions of law of the department.
(7) On petition to the court, the court’s power shall
extend to affirming the order of the director, modifying all or any part of the
director’s objections, adding additional objections, approving the proposed
activity as submitted or subject to such modifications or changes as the court
may find proper, and requiring resubmission to the boards of directors or other
governing bodies or for hearing as provided in ORS 732.526.
SECTION 38.
ORS 732.548 is amended to read:
732.548. As used in ORS 732.517 to 732.592:
(1) “Affiliate” of, or person “affiliated” with, a
specified person means a person that directly, or indirectly through one or
more intermediaries, controls, or is controlled by, or is under common control
with, the person specified.
(2) “Control,” including its use in the terms
“controlling,” “controlled,” “controlled by” and “under common control with,”
means the possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of a person, whether through the
ownership of voting securities, by contract other than a commercial contract
for goods or nonmanagement services, or otherwise, unless the power is the
result of an official position with or corporate office held by the person.
Control shall be presumed to exist if any person, directly or indirectly, owns,
controls, holds with the power to vote, or holds proxies representing, 10
percent or more of the voting securities of any other person. This presumption
may be rebutted by a showing made in the manner provided by ORS 732.568 that
control does not exist in fact. The Director of the Department of Consumer and
Business Services may determine, after furnishing all persons in interest
notice and opportunity to be heard and making specific findings of fact to
support such determination, that control exists in fact, notwithstanding the
absence of a presumption to that effect.
(3) “Insurance holding company system” means two or more
affiliated persons, one or more of which is an insurer, and includes a financial holding company as referred to in section
103 of the federal Gramm-Leach-Bliley Act (P.L. 106-102).
(4) A “subsidiary” of a specified person is an affiliate
controlled by the specified person directly or indirectly through one or more
intermediaries.
(5) A “voting security” includes any security convertible
into a voting security or evidencing a right to acquire a voting security.
SECTION 39.
ORS 733.620 is amended to read:
733.620. (1) Funds of an insurer may be invested in stocks
(including trust certificates) of solvent corporations organized and carrying
on a business under the laws of a sovereign as follows:
(a) Preferred or guaranteed stocks if the corporation is
not in default or arrears as to any preferred or guaranteed dividend and has
continuously and regularly paid such dividends during the preceding three years
or has paid cash dividends for five years on common stock.
(b) Common stocks as provided in paragraph (c) of this
subsection if:
(A) The obligations and preferred stock, if any, of such
corporation are eligible for investment under ORS 733.510 to 733.780; and
(B) The stock is registered on a national securities
exchange regulated under the Securities Exchange Act, or if of a type not
commonly so registered is regularly traded on a broad national or regional
basis.
(c) Notwithstanding ORS 733.780 (1), not more than 25
percent of admitted assets may be in common stocks that have not paid a cash
dividend during each of the five years preceding the date of acquisition.
(2) An insurer shall not invest so as to own or control
more than five percent of the voting power outstanding of a corporation, nor
shall it invest in the obligations or stocks of a corporation if the insurer,
directors, trustees and officers own or control, or as a result thereof shall
own and control, in the aggregate more than 50 percent of the voting power. This subsection does not apply to limit the
amount of an insurer’s assets that may be invested in the voting securities of
a depository institution or any company that controls the depository
institution.
SECTION 39a.
ORS 59.015 is amended to read:
59.015. As used in the Oregon Securities Law, unless the
context otherwise requires:
(1) “Broker-dealer” means a person who engages, all or part
of the time, in effecting transactions in securities for the account of others
or for the person’s own account. “Broker-dealer” does not include:
(a) An issuer effecting sales in its own securities;
(b) The following institutions:
(A) A financial institution or trust company, as defined in
ORS 706.008; or
(B) A financial
holding company or a bank holding company, as defined in ORS 706.008,
holding an institution described in subparagraph (A) of this paragraph; a
savings and loan holding company as defined in section 408 of the National
Housing Act, 12 U.S.C. section 1730a, holding an association described in
subparagraph (A) of this paragraph; the subsidiaries and affiliates of the financial holding company, bank holding
company or savings and loan holding company; or subsidiaries and affiliates of
institutions described in subparagraph (A) of this paragraph, if the
appropriate statutory regulatory authority is exercising control over, or is
regulating or supervising the person in the sale of securities in accord with
the purposes of the Oregon Securities Law;
(c) A person who has no place of business in this state
effecting transactions in this state exclusively with broker-dealers;
(d) A person effecting sales exempted by ORS 59.035;
(e) A salesperson, as defined in this section;
(f) A person effecting sales of securities owned by the
person registered for sale pursuant to ORS 59.065;
(g) A person effecting sales of securities exempted by ORS
59.025 (7);
(h) A person licensed as a mortgage banker or a mortgage
broker under ORS 59.840 to 59.965 when effecting sales of securities involving
real estate paper registered for sale pursuant to ORS 59.065; or
(i) A person designated by rule or order by the director.
(2) “Control” means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
a person, whether through the ownership of voting securities, by contract, or
otherwise.
(3) “Director” means the Director of the Department of
Consumer and Business Services.
(4) “Federal covered investment adviser” means a person who
is registered as an investment adviser pursuant to section 203 of the
Investment Advisers Act of 1940, as amended.
(5) “Federal covered security” means any security that is a
covered security under section 18 of the Securities Act of 1933, as amended,
and for which such Act provides that the director may require filing of a
notice and payment of a fee.
(6) “Fraud,” “deceit” and “defraud” are not limited to
common-law deceit.
(7) “Guaranteed” means guaranteed as to payment of
principal, interest or dividends.
(8)(a) “Investment adviser representative” means any
partner, officer, director or person occupying a similar status or performing a
similar function, or other individual, except clerical or ministerial
personnel, who is employed by or associated with:
(A) A state investment adviser that is licensed or required
to be licensed in this state and who does any of the following:
(i) Makes any recommendations or otherwise renders advice
regarding securities;
(ii) Manages accounts or portfolios of clients;
(iii) Determines which recommendation or advice regarding
securities should be given;
(iv) Solicits, offers or negotiates for the sale of or
sells investment advisory services; or
(v) Supervises employees acting under this subparagraph; or
(B) A federal covered investment adviser, subject to the
limitations of section 203A of the Investment Advisers Act of 1940, as amended,
as the director may designate by rule or order.
(b) “Investment adviser representative” does not include a
person designated by rule or order of the director.
(9) “Issuer” means a person who issues, proposes to issue
or has issued a security and includes an issuer to be formed. With respect to
certificates of deposit, voting-trust certificates or collateral-trust
certificates, or with respect to certificates of interest or shares in an
unincorporated investment trust not having a board of directors or persons
performing similar functions or of the fixed, restricted management or unit
type, the “issuer” is the person or persons performing the acts and assuming
the duties of depositor or manager pursuant to the provisions of the trust or
other instrument or agreement under which the security is issued.
(10) “License” means a license as provided under the Oregon
Securities Law.
(11) “Mortgage banker” means a mortgage banker as defined
in ORS 59.840.
(12) “Mortgage broker” means a mortgage broker as defined
in ORS 59.840.
(13) “Offer” or “offer to sell” includes every attempt or
offer to dispose of, or solicitation of an offer to buy, a security or interest
in a security for value. Every sale or offer of a warrant or right to purchase
or subscribe to another security of the same or another issuer, as well as
every sale or offer of a security which gives the holder a present or future
right or privilege to convert into another security of the same or another
issuer, is considered to include an offer of the other security.
(14) “Person” includes an individual, a joint venture, a
partnership, a cooperative, a limited liability company, an association, a
joint stock company, a corporation, a trust, an unincorporated organization or
a government or political subdivision of a government.
(15) “Real estate paper” means any obligation secured or
purportedly secured by an interest in real property. Real estate paper
includes, but is not limited to, mortgage-backed securities, collateralized
mortgage obligations, and real estate mortgage investment conduits.
(16) “Registered” means registered as provided in the
Oregon Securities Law.
(17)(a) “Sale” or “sell” includes every contract of sale
of, contract to sell, or disposition of, a security or interest in a security
for value. Any security given or delivered with, or as a bonus on account of, a
purchase of securities or any other thing shall constitute a part of the
subject of the purchase and shall have been offered and sold for value. A gift
of assessable stock by or for any issuer or promoter shall constitute a sale.
(b) For purposes of the authority of the director under ORS
59.245 and 59.255, the terms “sale” and “sell” include the terms “offer” and
“offer to sell” as defined in this section.
(c) “Sale” and “sell” do not include:
(A) A bona fide pledge or loan of securities;
(B) A bona fide security dividend, whether the corporation
distributing the dividend is the issuer of the security or not, if nothing of
value is given by the recipients for the dividend other than payments in
connection with the elimination of fractional shares; or
(C) An act incident to a judicially approved reorganization
in which a security is issued in exchange for one or more outstanding
securities, claims or property interests, or partly in such exchange and partly
for cash.
(18)(a) “Salesperson” means:
(A) A person, other than a broker-dealer, who represents or
purports to represent a broker-dealer, issuer or owner of securities in
effecting or attempting to effect in any manner transactions in securities.
(B) A person, other than a person licensed as a mortgage
banker or mortgage broker under ORS 59.840 to 59.965, who represents or
purports to represent the issuer, owner, or mortgage banker or mortgage broker
licensed under ORS 59.840 to 59.965 in effecting sales of securities or
involving real estate paper registered for sale pursuant to ORS 59.065.
(b) “Salesperson” does not include:
(A) A person who represents an issuer in effecting sales in
a security exempted by ORS 59.025;
(B) A person who represents an issuer in effecting sales
exempted by ORS 59.035;
(C) A person who represents an issuer in effecting sales
with existing partners or directors of the issuer, if no commission or other
remuneration is paid or given directly or indirectly for soliciting any person
in this state;
(D) An employee of an institution or organization described
in subsection (1)(b) of this section to the extent the employee is not a dual
employee of the institution and a broker-dealer;
(E) A person effecting transactions in this state limited to
those transactions described in section 15(h)(2) and (3) of the Securities
Exchange Act of 1934, as amended; or
(F) A person designated by rule or order by the director.
(c) A person who is a partner, director or officer of a
broker-dealer, issuer or owner of securities, or a person who occupies a
similar status or performing similar functions, is a “salesperson” only if the
person otherwise comes within this definition.
(19)(a) “Security” means a note, stock, treasury stock,
bond, debenture, evidence of indebtedness, certificate of interest or
participation in a pension plan or profit-sharing agreement, collateral-trust
certificate, preorganization certificate or subscription, transferable share,
investment contract, voting-trust certificate, certificate of deposit for a
security, certificate of interest or participation in an oil, gas, or mining
title or lease or in payments out of production under such title or lease, real
estate paper sold by a broker-dealer, mortgage banker, mortgage broker or a person
described in subsection (1)(b) of this section to persons other than persons
enumerated in ORS 59.035 (4), or, in general, any interest or instrument
commonly known as a “security,” or any certificate of interest or participation
in, temporary or interim certificates for, receipt for, guarantee of, or
warrant or right to subscribe to or purchase any of the foregoing.
(b) “Security” does not include:
(A) An insurance or endowment policy or annuity contract
under which an insurance company promises to pay a fixed or variable sum of
money either in a lump sum or periodically for life or some other specified
period;
(B) A beneficial interest in a voluntary inter vivos trust
unless the trust is created solely for the purpose of voting or is part of an
attempt to evade the provisions of ORS 59.005 to 59.370; or
(C) A beneficial interest in a testamentary trust.
(20)(a) “State investment adviser” means a person who, for
compensation:
(A) Engages all or part of the time of the person, in this
state, in the business of advising others, either directly or by mail or
through publication or writing, as to the value of securities or as to the
advisability of investing in, purchasing or selling securities;
(B) Engages all or part of the time of the person, in this
state, in the business of managing an investment or trading account in
securities for other persons; or
(C) Issues or promulgates, as part of a regular business in
this state, analyses or reports concerning securities.
(b) “State investment adviser” does not include:
(A) An investment adviser representative;
(B) An institution or organization described in subsection
(1)(b) of this section;
(C) A licensed broker-dealer whose performance of
investment advisory services is solely incidental to the conduct of business as
a broker-dealer and who receives no special compensation for such services;
(D) A salesperson licensed to a broker-dealer whose
performance of investment advisory services is solely incidental to that
person’s activities as a salesperson and who receives no special compensation
for such services;
(E) A publisher of or contributor to a bona fide newspaper,
newsmagazine, investment manual or service, or business or financial
publication of general, regular and paid circulation;
(F) A person whose only clients are federal covered
investment advisers, state investment advisers, broker-dealers, mortgage
bankers, mortgage brokers, banks, savings institutions or trust companies,
insurance companies, investment companies as defined in the Investment Company
Act of 1940, as amended, pension or profit-sharing trusts, or other financial
institutions or institutional buyers, whether acting for themselves or as
trustees;
(G) A duly licensed lawyer, engineer or accountant whose
performance of investment advisory services is solely incidental to the
practice of the profession;
(H) A person whose advice, analyses or reports relate only
to securities exempted by ORS 59.025 (1);
(I) A federal covered investment adviser in compliance with
ORS 59.165 (7);
(J) A person, advising others, that has no place of
business in this state and during the preceding 12-month period has had fewer
than six clients, other than those persons included in subparagraph (F) of this
paragraph, who are residents of this state; or
(K) Such other persons as the director may by rule or order
designate.
SECTION 40.
ORS 59.840 is amended to read:
59.840. As used in ORS 59.840 to 59.965:
(1) “Director” means the Director of the Department of
Consumer and Business Services.
(2) “Fraud,” “deceit” and “defraud” are not limited to
common-law deceit.
(3) “License” means a license issued to a mortgage banker
or mortgage broker under ORS 59.840 to 59.965.
(4) “Mortgage banker”:
(a) Means any person who for compensation or in the
expectation of compensation:
(A) Either directly or indirectly makes, negotiates or
offers to make or negotiate a mortgage banking loan or a mortgage loan; and
(B) Services or sells a mortgage banking loan.
(b) Does not include:
(A) A financial institution, as defined in ORS 706.008.
(B) A financial
holding company or a bank holding company, as defined in ORS 706.008,
holding an institution described in subparagraph (A) of this paragraph; a
savings and loan holding company as defined in section 408 of the National
Housing Act, 12 U.S.C. 1730a (1982), holding an association described in
subparagraph (A) of this paragraph; the subsidiaries and affiliates of the financial holding company, bank holding
company or savings and loan holding company; or subsidiaries and affiliates of
institutions described in subparagraph (A) of this paragraph, provided that the
appropriate statutory regulatory authority is exercising control over or is
regulating or supervising the persons listed in this subparagraph in their mortgage
banking activities in accordance with the purposes of ORS 59.840 to 59.965.
(C) A person who makes a loan secured by an interest in
real estate with the person’s own moneys, for the person’s own investment and
who is not engaged in the business of making loans secured by an interest in
real estate.
(D) An attorney licensed in this state who negotiates
mortgage banking loans or mortgage loans in the ordinary course of business,
unless the business of negotiating mortgage banking loans or mortgage loans
constitutes substantially all of the attorney’s professional activity.
(E) A person who, as seller of real property, receives one
or more mortgages or deeds of trust as security for a separate money
obligation.
(F) An agency of any state or of the United States.
(G) A person who receives a mortgage or deed of trust on
real property as security for an obligation payable on an installment or
deferred payment basis and arising out of materials furnished or services
rendered in the improvement of that real property or any lien created without
the consent of the owner of the real property.
(H) A person who funds a mortgage banking loan or mortgage
loan which has been originated and processed by a licensee or by an exempt
person and who does not maintain a place of business in this state in
connection with funding mortgage banking loans or mortgage loans, does not
directly or indirectly solicit borrowers in this state for the purpose of
making mortgage banking loans or mortgage loans and does not participate in the
negotiation of mortgage banking loans or mortgage loans. For the purpose of
this subparagraph, “negotiation of mortgage banking loans or mortgage loans”
does not include setting the terms under which a person may buy or fund a
mortgage banking loan or a mortgage loan originated by a licensee or exempt
person.
(I) A nonprofit federally tax exempt corporation certified
by the United States Small Business Administration and organized to promote
economic development within this state whose primary activity consists of
providing financing for business expansion.
(J) A licensee licensed under ORS chapter 725 or a mortgage
broker.
(K) A retirement or pension fund.
(L) An insurer as defined in ORS 731.106.
(M) A court appointed fiduciary.
(N) Any other person designated by rule or order of the
director.
(5) “Mortgage banking loan” means a loan, extension of
credit or a retail sales contract that is funded exclusively from the mortgage
banker’s own resources, which is directly or indirectly secured by a mortgage
or deed of trust or any lien interest on real estate and which is created with
the consent of the owner of the real property. For purposes of this subsection,
“own resources” means any of the following:
(a) Cash, corporate capital, warehouse credit lines at
financial institutions defined in ORS 706.008 or other sources that are
liability items of the mortgage banker’s financial statements for which its
assets are pledged;
(b) Correspondent contracts between the mortgage banker and
a bank, savings bank, trust company, savings and loan association, credit
union, profit sharing or pension trust, a licensee under ORS chapter 725 or an
insurance company; or
(c) The mortgage banker’s affiliates’ cash, corporate
capital, warehouse credit lines at financial institutions defined in ORS
706.008 or other sources that are liability items on the affiliates’ financial
statements for which the affiliates’ assets are pledged. As used in this
paragraph, “affiliates” means entities that, directly or indirectly, through
one or more intermediaries controls, are controlled by or are under common
control with the entity specified.
(6) “Mortgage broker”:
(a) Means a person who:
(A) Engages all or part of the time, for the account of
others or for the person’s own account, in the business of selling real estate
paper whether as issuer, agent or principal to persons other than persons
enumerated in ORS 59.035 (4);
(B) Engages all or part of the time, for the account of
others or for the person’s own account, in the business of accepting funds from
one or more persons other than persons enumerated in ORS 59.035 (4) for
investment in real estate paper; or
(C) For compensation, or in the expectation of
compensation, either directly or indirectly makes, negotiates or offers to make
or negotiate a mortgage loan.
(b) Does not include:
(A) A financial institution, as defined in ORS 706.008.
(B) A financial
holding company or a bank holding company, as defined in ORS 706.008,
holding an institution described in subparagraph (A) of this paragraph; a
savings and loan holding company as defined in section 408 of the National
Housing Act, 12 U.S.C. 1730a (1982), holding an association described in
subparagraph (A) of this paragraph; the subsidiaries and affiliates of the financial holding company, bank holding
company or savings and loan holding company; or subsidiaries and affiliates of
institutions described in subparagraph (A) of this paragraph, provided that the
appropriate statutory regulatory authority is exercising control over or is
regulating or supervising the persons listed in this subparagraph in their
mortgage brokering activities in accordance with the purposes of ORS 59.840 to
59.965.
(C) A person who purchases real property and issues an
obligation to finance the transaction to the seller incidentally to the sale.
(D) A real estate licensee as defined in ORS 696.010 who
performs services solely incidental to the practice of professional real estate
activity as defined in ORS 696.010, unless the real estate licensee performs
the functions of a mortgage banker or a mortgage broker as defined in this
section.
(E) A person licensed under the provisions of ORS chapter
725 or a mortgage banker.
(F) A person who makes a loan secured by an interest in
real estate with the person’s own moneys, for the person’s own investment and
who is not engaged in the business of making loans secured by an interest in
real estate.
(G) An attorney licensed in this state who negotiates
mortgage loans in the ordinary course of business, unless the business of
negotiating mortgage loans constitutes substantially all of the attorney’s
professional activity.
(H) A person who, as seller of real property, receives one
or more mortgages or deeds of trust as security for a separate money
obligation.
(I) An agency of any state or of the United States.
(J) A person who receives a mortgage or deed of trust on
real property as security for an obligation payable on an installment or
deferred payment basis and arising out of materials furnished or services
rendered in the improvement of that real property or any lien created without
the consent of the owner of the real property.
(K) A person who funds a mortgage loan which has been
originated and processed by a licensee or by an exempt person and who does not
maintain a place of business in this state in connection with funding mortgage
loans, does not directly or indirectly solicit borrowers in this state for the
purpose of making mortgage loans and does not participate in the negotiation of
mortgage loans. For the purpose of this subparagraph, “negotiation of mortgage
loans” does not include setting the terms under which a person may buy or fund
a mortgage loan originated by a licensee or exempt person.
(L) A nonprofit federally tax exempt corporation certified
by the United States Small Business Administration and organized to promote
economic development within this state whose primary activity consists of
providing financing for business expansion.
(M) A person licensed under ORS 822.020 who provides
services customarily associated with the retail sales of manufactured
dwellings, including communication of generally available information regarding
mortgage loans, unless:
(i) The person receives from a purchaser a fee or
commission as a mortgage broker or mortgage banker that is disclosed in the
sales contract, purchase agreement or applicable federal documents;
(ii) For the benefit of a potential purchaser, the person
completes a loan application form or other document that is part of a mortgage
banking loan and completes a good faith estimate under the federal Real Estate
Settlement Procedures Act (12 U.S.C. 2601 et seq.);
(iii) The person solicits or receives credit information
from a prospective purchaser for the purpose of making credit decisions; or
(iv) The person negotiates with a potential purchaser the
terms of a mortgage loan including but not limited to points, interest rates,
length of loan or other loan conditions.
(N) Any other person designated by rule or order of the
director.
(7) “Mortgage loan” means a loan, extension of credit or
retail sales contract, other than a mortgage banking loan, secured by a
mortgage or deed of trust or any lien interest on real estate that is created
with the consent of the owner of the real estate.
(8) “Residential mortgage transaction” means a transaction
in which a mortgage, deed of trust, purchase money security interest arising
under an installment sales contract, or equivalent consensual security interest
is created or retained in property upon which four or fewer residential
dwelling units are planned or situated, including but not limited to individual
units or condominiums and cooperatives. As used in this subsection,
“residential dwelling unit” means an improvement designed for residential occupancy.
SECTION 41.
ORS 98.412 is amended to read:
98.412. (1) The Division of State Lands may require a
person who has not filed a report to file a verified report stating whether or
not the person is holding any unclaimed property reportable or deliverable
under ORS 98.352.
(2) The division may at reasonable times and upon
reasonable notice examine the records of any person to determine whether the
person has complied with the provisions of ORS 98.352. The division may conduct
the examination even if the person believes it is not in possession of any
property reportable or deliverable under this section.
(3) To the extent possible, the division shall enter into
agreements with state and federal agencies that regularly examine the records
of financial institutions, trust companies,
financial holding companies and bank holding companies, as defined in ORS
706.008, and of subsidiaries of such financial institutions, trust companies, financial holding companies and bank
holding companies. Under the agreements, the state and federal agencies shall
examine the records of the financial institution, trust company, financial holding company, bank holding
company or subsidiary to determine compliance with ORS 98.352. If a state or
federal agency does not enter into an agreement with the division under this
subsection, the division shall conduct the examination of the records of
financial institutions, trust companies,
financial holding companies and bank holding companies to determine
compliance with ORS 98.352.
(4) If a holder fails after August 3, 1983, to maintain the
records required by ORS 98.354 and the records of the holder available for the
periods subject to ORS 98.302 to 98.436 and 98.992 are insufficient to permit
the preparation of a report, the division may require the holder to report and
pay the amounts which the division reasonably estimates from the report and
available records.
SECTION 42.
ORS 205.460 is amended to read:
205.460. (1) A person whose property is subject to an
invalid claim of encumbrance may petition the circuit court of the county in
which the person resides or in which the property is located for an order,
which may be granted ex parte, directing the encumbrance claimant to appear at
a hearing before the court and show cause why the claim of encumbrance should
not be stricken and other relief provided by this section should not be
granted. The court shall schedule the hearing no earlier than seven days after
the date of the order. The scheduled date of the hearing shall allow adequate
time for notice of the hearing under subsection (4) of this section.
(2) A petition under this section shall state the grounds
upon which relief is requested, and shall be supported by the affidavit of the
petitioner or the petitioner’s attorney setting forth a concise statement of
the facts upon which the motion is based.
(3) The petition and affidavit described in subsection (2)
of this section shall be in substantially the following form:
______________________________________________________________________________
IN THE CIRCUIT COURT OF
THE STATE OF OREGON
FOR THE COUNTY OF ______
____________, )
Petitioner, ) Case
No. ___
)
) PETITION
FOR AN
) ORDER
STRIKING
v. ) AND
RELEASING
) ENCUMBRANCES,
) AWARDING
COSTS
) AND
ATTORNEY FEES
__________, ) AND
ORDER TO
Respondent. ) SHOW CAUSE
Petitioner, ___________ (insert name), by and through
___________ (insert name and title of attorney for petitioner, if applicable),
petitions this court, pursuant to ORS 205.460, for an order striking and releasing
purported encumbrances, filed or recorded against Petitioner by Respondent,
__________ (insert name or names) filed or recorded in book/reel/volume No.
_____ on page ____ or document/fee/ file/instrument/microfilm No. _____ in the
________ (insert name of office where document was filed or recorded), and for
an order, pursuant to ORS 205.460, for costs and attorney fees required to
bring this action, on the grounds that the purported encumbrances have no basis
in law or fact. Petitioner further requests that this court enter an order
requiring Respondent to appear before this court and to show cause why the
above order should not be entered. Finally, Petitioner requests an order from
the court requiring Respondent to pay penalties and damages as provided in ORS
205.470.
DATED this ____ day of_________, ____.
_____________________________
Petitioner or Petitioner’s
Attorney
______________________________________________________________________________
______________________________________________________________________________
IN THE CIRCUIT COURT OF
THE STATE OF OREGON
FOR THE COUNTY OF ______
____________, )
Petitioner, ) Case
No. ___
)
) AFFIDAVIT
OF
V. ) ________
)
)
____________, )
Respondent. )
______________
)
STATE OF OREGON )
) ss.
County of_________ )
I, _________ (insert name of affiant), after being duly
sworn, depose and say:
1. I am the above-entitled petitioner (or the attorney for
the petitioner) in this matter.
2. The information contained in this affidavit is of my own
personal knowledge.
3. Attached as numbered exhibits are true and correct
copies of the following documents that were filed or recorded in
the _________ (insert name of office where documents were filed or
recorded) on __________ (insert date):
(List and attach document(s))
4. For any purported encumbrances identified above the
following is true. The encumbrance is not authorized by statute, was not
entered into consensually, and is not an equitable, constructive or other
encumbrance imposed by a court of competent jurisdiction.
DATED this ____ day of________, ____.
_________________________
(Petitioner or Petitioner’s
Attorney)
SUBSCRIBED AND SWORN to
before me this ____ day of__________, ____.
_________________________
NOTARY PUBLIC FOR OREGON
My commission expires:
_______
______________________________________________________________________________
(4) A copy of the petition and the order directing the
encumbrance claimant to appear under this section shall be served upon the
encumbrance claimant:
(a) By service in the manner provided for personal service
of summons under ORCP 7; or
(b) By mailing a true copy of the petition, affidavit and
order to the encumbrance claimant at the encumbrance claimant’s last-known
address, both by first class mail and by certified or registered mail, return
receipt requested. A notice mailed under this paragraph is effective on the
date that the notice is deposited with the United States Postal Service,
properly addressed and postage prepaid.
(5) The order to show cause shall be in substantially the
following form and shall clearly state that if the encumbrance claimant fails
to appear at the time and place noted, the claim of encumbrance shall be
stricken and released and that the encumbrance claimant shall be ordered to pay
the costs and reasonable attorney fees incurred by the petitioner at trial and
on appeal:
______________________________________________________________________________
IN THE CIRCUIT COURT OF
THE STATE OF OREGON
FOR THE COUNTY OF ______
___________, )
Petitioner, ) Case
No. ___
)
) ORDER
TO
v. ) SHOW
CAUSE
)
)
___________, )
Respondent. )
THIS MATTER came before the court on ______ (insert date)
on Petitioner’s Petition for an Order Striking and Releasing Encumbrances,
Awarding Costs and Attorney Fees and Order to Show Cause. The court, having
considered the petition, the Affidavit of ______ (insert name) and the
attached exhibits, and it appearing to the court that there are sufficient
grounds to issue an order to show cause,
IT IS HEREBY ORDERED that the Respondent, ______ (insert
name), appear before this court on ______ (insert date), at ____ (insert time),
to show cause why the petition should not be granted in its entirety.
IMPORTANT NOTICE:
IF YOU FAIL TO APPEAR AT THE ABOVE TIME AND PLACE, THE
COURT MAY ENTER AN ORDER STRIKING AND RELEASING YOUR ENCUMBRANCE CLAIMS FILED
AGAINST PETITIONER AND YOU MAY BE ORDERED TO PAY COSTS AND REASONABLE ATTORNEY
FEES INCURRED BY THE PETITIONER.
DATED this ____ day of_______, ____.
___________________________
Circuit Court Judge
______________________________________________________________________________
(6) If the court determines that the claim of encumbrance
is invalid, the court shall issue an order striking and releasing the claim of
encumbrance and may award costs and reasonable attorney fees at trial and on
appeal to the petitioner to be paid by the encumbrance claimant. If the court
determines that the claim of encumbrance is valid, the court shall issue an
order so stating and may award costs and reasonable attorney fees at trial and
on appeal to the encumbrance claimant to be paid by the petitioner.
(7) The procedure set forth in this section is not
available against a person lawfully conducting business as:
(a) An institution, a savings bank, a national bank, an
out-of-state bank, a federal savings bank or an extranational institution, as
those terms are defined in ORS 706.008, or a subsidiary of an entity described
in this paragraph;
(b) A savings association or a federal association, as
those terms are defined in ORS 722.004, or a subsidiary of an entity described
in this paragraph;
(c) A financial
holding company, a bank holding
company, a savings and loan holding company or a subsidiary of a financial holding company, a bank
holding company or a savings and loan holding company;
(d) A credit union, as defined in ORS 723.006, or a federal
credit union;
(e) A consumer finance company subject to the provisions of
ORS chapter 725;
(f) A mortgage banker or a mortgage broker, as those terms
are defined in ORS 59.840, a mortgage servicing company or any other mortgage
company; or
(g) An insurer as defined in ORS 731.106.
(8) The procedure set forth in this section is not
available against:
(a) An officer, agency, department or instrumentality of
the federal government;
(b) An officer, agency, department or instrumentality of
this state; or
(c) An officer, agency, department or instrumentality of a
political subdivision or public corporation in this state.
SECTION 43.
ORS 294.035 is amended to read:
294.035. Subject to ORS 294.040 and 294.135 to 294.155, the
custodial officer may, after having obtained a written order from the governing
body of the county, municipality, political subdivision or school district,
which order shall be spread upon the minutes or journal of the governing body,
invest any sinking fund, bond fund or surplus funds in the custody of the
custodial officer in the bank accounts, classes of securities at current market
prices, insurance contracts and other investments listed in this section.
However, the custodial officer of any county shall make no such investment of
funds belonging to any municipality, political subdivision or school district,
unless and until the custodial officer has received a written order from the
governing body of the municipality, political subdivision or school district to
which the funds belong, which order authorizes the custodial officer to invest
the funds, and which order has been spread upon the minutes or journal of the governing
body. This section, however, shall not limit the authority of the custodial
officer to invest surplus funds in other investments when the investment is
specifically authorized by another statute. Investments authorized by this
section are:
(1) Lawfully issued general obligations of the United
States, the agencies and instrumentalities of the United States or enterprises
sponsored by the United States Government.
(2) Lawfully issued debt obligations of the agencies and
instrumentalities of the State of Oregon and its political subdivisions that
have a long-term rating of A or an equivalent rating or better or are rated on
the settlement date in the highest category for short-term municipal debt by a
nationally recognized statistical rating organization.
(3) Lawfully issued debt obligations of the States of
California, Idaho and Washington and political subdivisions of those states if
the obligations have a long-term rating of AA or an equivalent rating or better
or are rated on the settlement date in the highest category for short-term
municipal debt by a nationally recognized statistical rating organization.
(4) Time deposit open accounts, certificates of deposit and
savings accounts in insured institutions as defined in ORS 706.008 that
maintain a head office or a branch in this state.
(5) Share accounts and savings accounts in credit unions in
the name of, or for the benefit of, a member of the credit union pursuant to a
plan of deferred compensation.
(6) Fixed or variable life insurance or annuity contracts
as defined by ORS 731.170 and guaranteed investment contracts issued by life
insurance companies authorized to do business in this state.
(7) Trusts in which deferred compensation funds from other
public employers are pooled, if:
(a) The purpose is to establish a deferred compensation
plan;
(b) The trust is a public instrumentality of such public
employers and described in section (2)(b) of the Investment Company Act of
1940, 15 U.S.C. 80a-2(b), as amended, in effect on September 20, 1985, or the
trust is a common trust fund described in ORS 709.170;
(c) Under the terms of the plan the net income from or gain
or loss due to fluctuation in value of the underlying assets of the trust, or
other change in such assets, is reflected in an equal increase or decrease in
the amount distributable to the employee or the beneficiary thereof and,
therefore, does not ultimately result in a net increase or decrease in the
worth of the public employer or the state; and
(d) The fidelity of the trustees and others with access to
such assets, other than a trust company, as defined in ORS 706.008, is insured
by a surety bond that is satisfactory to the public employer, issued by a
company authorized to do a surety business in this state and in an amount that
is not less than 10 percent of the value of such assets.
(8)(a) Banker’s acceptances, if the banker’s acceptances
are:
(A) Guaranteed by, and carried on the books of, a qualified
financial institution;
(B) Eligible for discount by the Federal Reserve System;
and
(C) Issued by a qualified financial institution whose
short-term letter of credit rating is rated in the highest category by one or
more nationally recognized statistical rating organizations.
(b) For the purposes of this subsection, “qualified
financial institution” means:
(A) A financial institution that is located and licensed to
do banking business in the State of Oregon; or
(B) A financial institution that is wholly owned by a financial holding company or a bank
holding company that owns a financial institution that is located and licensed
to do banking business in the State of Oregon.
(c) A custodial officer shall not permit more than 25
percent of the moneys of a local government that are available for investment,
as determined on the settlement date, to be invested in banker’s acceptances of
any qualified financial institution.
(9)(a) Corporate indebtedness subject to a valid
registration statement on file with the Securities and Exchange Commission or
issued under the authority of section 3(a)(2) or 3(a)(3) of the Securities Act
of 1933, as amended. Corporate indebtedness described in this subsection does
not include banker’s acceptances. The corporate indebtedness must be issued by
a commercial, industrial or utility business enterprise, or by or on behalf of
a financial institution, including a holding company owning a majority interest
in a qualified financial institution.
(b) Corporate indebtedness must be rated on the settlement
date P-1 or Aa or better by Moody’s Investors Service or A-1 or AA or better by
Standard & Poor’s Corporation or equivalent rating by any nationally
recognized statistical rating organization.
(c) Notwithstanding paragraph (b) of this subsection, the
corporate indebtedness must be rated on the settlement date P-2 or A or better
by Moody’s Investors Service or A-2 or A or better by Standard & Poor’s
Corporation or equivalent rating by any nationally recognized statistical
rating organization when the corporate indebtedness is:
(A) Issued by a business enterprise that has its
headquarters in Oregon, employs more than 50 percent of its permanent workforce
in Oregon or has more than 50 percent of its tangible assets in Oregon; or
(B) Issued by a holding company owning not less than a
majority interest in a qualified financial institution, as defined in
subsection (8) of this section, located and licensed to do banking business in
Oregon or by a holding company owning not less than a majority interest in a
business enterprise described in subparagraph (A) of this paragraph.
(d) A custodial officer shall not permit more than 35
percent of the moneys of a local government that are available for investment,
as determined on the settlement date, to be invested in corporate indebtedness,
and shall not permit more than five percent of the moneys of a local government
that are available for investment to be invested in corporate indebtedness of
any single corporate entity and its affiliates or subsidiaries.
(10) Securities of any open-end or closed-end management
investment company or investment trust, if the securities are of the types
specified in subsections (1) to (3), (8) and (9) of this section and if the
investment does not cause the county, municipality, political subdivision or
school district to become a stockholder in a joint company, corporation or
association. A trust company or trust department of a national bank while
acting as indenture trustee may invest funds held by it as indenture trustee in
any open-end or closed-end management investment company or investment trust
for which the trust company or trust department of a national bank or an
affiliate of the trust company or trust department of a national bank acts as
investment adviser or custodian or provides other services. However, the
securities of the investment company or investment trust in which such funds
are invested must be of the types specified in subsections (1) to (3), (8) and
(9) of this section and the investment must not cause the county, municipality,
political subdivision or school district whose funds are invested to become a
stockholder in a joint company, corporation or association. For purposes of
this subsection, companies are affiliated if they are members of the same
affiliated group under section 1504 of the Internal Revenue Code of 1986 (26
U.S.C. 1504).
(11) Repurchase agreements whereby the custodial officer
purchases securities from a financial institution or securities dealer subject
to an agreement by the seller to repurchase the securities. The repurchase
agreement must be in writing and executed in advance of the initial purchase of
the securities that are the subject of the repurchase agreement. Only
securities described in subsection (1) of this section shall be used in
conjunction with a repurchase agreement and such securities shall have a
maturity of not longer than three years. The price paid by the custodial
officer for such securities may not exceed amounts or percentages prescribed by
written policy of the Oregon Investment Council or the Oregon Short Term Fund
Board created by ORS 294.885.
SECTION 44.
ORS 646.382 is amended to read:
646.382. As used in ORS 646.382 to 646.396:
(1) “Consumer” means any individual who is solicited to
purchase or who purchases the services of a credit services organization.
(2)(a) “Credit services organization” means any person who,
with respect to the extension of credit by others, sells, provides, performs,
or represents that the organization can or will sell, provide or perform, in
return for the payment of money or other valuable consideration, any of the
following services:
(A) Improving, saving or preserving a consumer’s credit
record, history or rating.
(B) Obtaining an extension of credit for a consumer.
(C) Providing advice, assistance, instruction or
instructional materials to a consumer with regard to either subparagraph (A) or
(B) of this paragraph.
(b) “Credit services organization” does not include:
(A) Any person authorized to make loans or extensions of
credit under the laws of this state or the United States who is subject to
regulation and supervision by this state or the United States or a lender
approved by the Secretary of Housing and Urban Development for participation in
any mortgage insurance program under the National Housing Act.
(B) Any financial institution, financial holding company or bank holding company as those terms
are defined in ORS 706.008 or any subsidiary or affiliate of a financial
institution, financial holding company
or bank holding company.
(C) A mortgage banker or mortgage broker as defined in ORS
59.840.
(D) Any nonprofit organization exempt from taxation under
section 501(c)(3) of the Internal Revenue Code, provided that the organization
does not require a fee for its services and does not receive any money or other
valuable consideration prior to the rendering of any services by the
organization for the consumer.
(E) Any person licensed as a real estate broker by this
state if the person is acting within the course and scope of that license.
(F) Any person licensed to practice law in this state if
the person renders services within the course and scope of practice as an
attorney.
(G) Any broker-dealer registered with the Securities and
Exchange Commission or the Commodity Futures Trading Commission if the
broker-dealer is acting within the course and scope of that regulation.
(H) Any consumer reporting agency as defined in the Federal
Fair Credit Reporting Act, 15 U.S.C. 1681 et seq.
(I) Any licensee licensed under ORS chapter 725.
(3) “Department” means the Department of Consumer and
Business Services.
(4) “Director” means the director of the department or the
director’s designees.
(5) “Extension of credit” means the right to defer payment
of debt or to incur debt and defer its payment offered or granted primarily for
personal, family or household purposes.
SECTION 45.
ORS 706.005 is amended to read:
706.005. As used in the Bank Act, unless the context
requires otherwise:
(1) “Access area” means any paved walkway or sidewalk
within 50 feet of an automated teller machine or night deposit facility.
“Access area” does not include publicly maintained sidewalks or roads.
(2) “Access device” means:
(a) An “access device” as defined in Federal Reserve Board
Regulation E (12 C.F.R. Part 205) adopted under the Electronic Fund Transfer
Act (15 U.S.C. 1601, et seq.); or
(b) A key or other mechanism issued by a financial
institution to a customer to give the customer access to the institution’s or
bank’s night deposit facility.
(3) “Acquisition transaction” means:
(a) The sale and purchase of all or substantially all of
the assets of a bank that is not in the ordinary course of business of such
bank; or
(b) The transfer and assumption of all or substantially all
of the liabilities of a bank.
(4) “Automated teller machine” or “ATM” means any
electronic information processing device located in this state that:
(a) Accepts or dispenses cash in connection with a credit,
deposit or convenience account, provides information and initiates transactions
in accordance with the request or instruction of a customer or the customer’s
agent; and
(b) Is unstaffed except for persons installing the device,
providing security or providing periodic servicing, maintenance or repair. The
term does not include devices used solely to facilitate check guarantees or
check authorizations, or used in connection with the acceptance or dispensing
of cash on a person to person basis, such as by a store cashier.
(5) “Bank Act” means ORS chapters 706 to 716.
(6) “Banking business” or “business of banking” means the
business of receiving or accepting money or its equivalent on deposit as a
regular business whether the deposit is made subject to check or is evidenced
by a certificate of deposit, a pass book or other writing or evidence, but does
not include:
(a) Depositing money or its equivalent in escrow or with an
agent, pending investments in real estate or securities for or on account of a
principal;
(b) The business of a savings and loan association or a
credit union;
(c) Deposits accepted in connection with the purchase or
lease of property or services; or
(d) Accepting deposits through an ATM or night deposit
facility.
(7) “Banking day” has the meaning given that term in ORS
708A.650.
(8) “Branch” means an office or other place, except a
principal place of business or an ATM, at which:
(a) A bank engages in banking business; or
(b) A trust company transacts trust business.
(9) “Candlefoot power” means a light intensity of candles
on a horizontal plane at 36 inches above ground level and 5 feet in front of
the area to be measured.
(10) “Capital debentures” means capital notes, capital
debentures and any other form of unsecured obligations issued by an institution
or stock savings bank to evidence borrowings where the rights of the lender are
subordinate to the rights of the depositors.
(11)(a) “Defined parking area” means that portion of any
parking area opened for customer parking that is:
(A) Contiguous to the access area of an ATM or night
deposit facility;
(B) Regularly, principally and lawfully used for parking by
users of the ATM or night deposit facility while the users conduct transactions
during hours of darkness; and
(C) Owned or leased by the operator of the ATM or night
deposit facility or owned or controlled by the party leasing the ATM or night
deposit facility site to the operator.
(b) “Defined parking area” does not include any parking
area that is not open or regularly used for parking by users of the ATM or
night deposit facility who are conducting transactions during the hours of darkness.
A parking area is not open if it is physically closed to access or if
conspicuous signs indicate that it is closed. If a multiple level parking area
satisfies the conditions of paragraph (a) of this subsection and would
therefore otherwise be a defined parking area, only the single parking level
designated by the operator of the ATM and night deposit facility to be the most
directly accessible to the users of the ATM and night deposit facility shall be
a defined parking area.
(12) “Department” means the Department of Consumer and
Business Services.
(13) “Director” means the Director of the Department of
Consumer and Business Services.
(14) “Document of title” means document of title as defined
in ORS 71.2010.
(15) “Federal Reserve Act” means the Act of Congress
approved December 23, 1913 (38 Stat. 251), as amended.
(16) “Federal Reserve Bank” means the Federal Reserve Banks
created and organized under the authority of the Federal Reserve Act.
(17) “Federal Reserve Board” means the Federal Reserve
Board created and described in the Federal Reserve Act.
(18) “Home state” means:
(a) With respect to a state bank, the state under the laws
of which the state bank is incorporated or otherwise organized;
(b) With respect to a federal bank, the state in which the
main office of the federal bank is located;
(c) With respect to an extranational institution, the state
determined to be the home state by election of the extranational institution,
or in default of such election, by the Board of Governors of the Federal
Reserve System; and
(d) With respect to a financial
holding company or a bank holding company, the state in which the total
deposits of all banking subsidiaries of such company are the largest on the
date on which the company becomes a financial
holding company or a bank holding company.
(19) “Hours of darkness” means the period that commences 30
minutes after sunset and ends 30 minutes before sunrise.
(20) “Loan production office” means a physical location in
this state at which representatives of a financial institution hold themselves
out to the public as providing loan origination services, leasing services or
services of a similar nature, but at which representatives of the financial
institution do not conduct banking business.
(21) “Merger” includes consolidation.
(22) “Night deposit facility” means a receptacle that is
provided by a financial institution for the use of the institution’s customers
in delivering cash, checks and other items to the financial institution.
(23) “Obligations” includes:
(a) The direct liability of the maker or acceptor of paper
discounted with or sold to an institution;
(b) The liability of the drawer, indorser or assignor;
(c) If obligations of a copartnership or association, the
obligations of the several members of the copartnership or association;
(d) If obligations of a corporation, the obligations of all
subsidiaries of the corporation in which the corporation owns or controls 50
percent or more of the capital stock; and
(e) The liability of a lessee under a lease.
(24) “Officer” of a banking institution means a chief
executive officer, president, any vice president, secretary, treasurer or
cashier.
(25) “Operator” means any financial institution or other
business entity, or any person who operates an ATM or night deposit facility.
(26) “Paid-in capital” means the aggregate amount received
by an institution or stock savings bank from the issuance of its stock or
transferred from retained earnings.
(27) “Person” means an individual, corporation, limited
liability company, partnership, association, joint stock company, business
trust or unincorporated organization.
(28) “Stockholders’ equity” means the aggregate of paid-in
capital and retained earnings of an institution or Oregon stock savings bank.
(29) “Trust business” means:
(a) Acting as a trustee of a trust, as defined in ORS
128.005;
(b) Acting as a fiduciary, as defined in ORS 125.005;
(c) Acting as a personal representative, as defined in ORS
111.005;
(d) Acting as a receiver, trustee or assignee for the
benefit of creditors; or
(e) Acting in a court-appointed position of trust or any
other position of trust.
SECTION 46.
ORS 706.690 is amended to read:
706.690. (1) If the Director of the Department of Consumer
and Business Services determines that the condition of an institution or Oregon
stock savings bank is such that any transfer of the capital stock of the
institution or Oregon stock savings bank would jeopardize the interest of its
depositors, the director shall notify the institution or Oregon stock savings
bank in writing that when any shares of the capital stock of the institution or
Oregon stock savings bank are to be transferred on the books or records of the
institution or Oregon stock savings bank, the officer proposing to make the
transfer shall report in writing to the director the proposed transfer of
stock. A transfer of stock shall not be made, after the date such a notice is
issued, unless the transfer agent first obtains the written consent of the
director. The director shall notify the institution or Oregon stock savings
bank of the director’s decision within 30 days after receiving the report.
(2) If a director or officer of an institution or Oregon
stock savings bank, a transfer agent, vendee or vendor has reason to believe
that a transfer of stock creates or changes a controlling interest in an
institution or Oregon stock savings bank, that person shall immediately notify
the director of the transfer. A transfer that creates a controlling interest
in, or changes the control of, an institution or Oregon stock savings bank
shall not be entered upon the books of the institution or Oregon stock savings
bank or become effective until:
(a) Notice has been received at the office of the director;
and
(b) The sale, exchange or other disposition has been
approved in writing by the director.
(3) For purposes of this section, a controlling interest of
an institution or Oregon stock savings bank exists if a person, directly or
indirectly, acting through one or more other persons, owns or has power to vote
25 percent or more of any class of voting stock of an institution or Oregon
stock savings bank or of a corporation that is or becomes a financial holding company or a bank
holding company as defined in ORS 706.008 unless:
(a) The stock of the institution or Oregon stock savings
bank is held in a fiduciary capacity and not for the benefit of the person or
of the stockholders, employees or members of the person; or
(b) The stock is acquired, not as a means of circumventing
ORS chapter 715, but by the person in the ordinary course of business to secure
or collect a debt previously contracted in good faith and the person disposes
of the stock within two years after the acquisition of the stock. The director
may extend the period if an extension will not be detrimental to the public
interest or in contravention of any other law.
(4) The director shall approve or disapprove the transfer
in accordance with the standards provided by ORS 707.080 (1). The director also
may disapprove a transfer under subsection (2) of this section if any of the
reasons stated by ORS 707.145 apply to the proposed new owner of the shares.
(5) Notwithstanding subsections (2) to (4) of this section,
if the person acquiring a controlling interest in an institution or Oregon
stock savings bank is or will through such acquisition become a financial holding company or a bank
holding company, the provisions of ORS chapter 715 apply to the change in
controlling interest in lieu of the provisions of subsections (2) to (4) of
this section.
SECTION 47.
ORS 708A.120 is amended to read:
708A.120. (1) An institution shall not invest any of its
assets in the capital stock of any other corporation, except:
(a) In the capital stock of the Federal Reserve Bank.
(b) In stock acquired or purchased to save a loss on a
preexisting debt. The stock shall be sold within two years of the date acquired
or purchased. The Director of the Department of Consumer and Business Services
may extend the time if the director finds that an extension will not be
detrimental to the public interest and will not contravene any other law.
(c) In the capital stock of any safe deposit company doing
an exclusive safe deposit business on premises owned or leased by the
institution upon 30 days’ advance notice to the director subject to the same
limitations applicable to a national bank.
(d) In the capital stock of agricultural and livestock
finance companies, subject to the same limitations applicable to national banks
and to the approval of the director.
(e) In the capital stock, eligible for purchase by national
banks, of small business investment companies, but the aggregate investment in
the stock shall not exceed two percent of the capital of the institution.
(f) In the common stock of any federally chartered
corporation that is chartered for the purpose of providing secondary markets
for the sale of mortgages by institutions.
(g) In the stock of the Federal Home Loan Bank.
(h) In the capital stock of a corporation exclusively
engaged in a trust business or a banker’s bank, subject to the same limitations
applicable to national banks.
(i) In the capital stock of bank service corporations as
provided in ORS 708A.130 to 708A.145.
(j) In the capital stock of a community development
corporation as provided in ORS 708A.150.
(k) If a trust company is not engaged in a banking business
and if the investment is first approved by the director, the trust company may
invest an amount not to exceed 20 percent of the capital of the trust company:
(A) In the capital stock of a subsidiary investment company
defined in the Investment Company Act of 1940, as amended; or
(B) In a company one of the purposes of which is to act as
a federal covered investment adviser or a state investment adviser, as defined
in ORS 59.015, with all the powers customarily exercised by a federal covered
investment adviser or a state investment adviser.
(L) In adjustable rate preferred stock of the Student Loan
Marketing Association established in 20 U.S.C. 1087-2, but the aggregate
investment in the stock shall not exceed 15 percent of the capital of the
institution.
(m) In the capital stock of a company acquired for the
purpose of strengthening the institution’s capital structure or the elimination
of undesirable assets as provided in ORS 708A.125.
(n) In the capital stock of banks and corporations engaged
in international or foreign banking or foreign banking in a dependency or
insular possession of the United States, as provided in ORS 708A.155.
(o) In the capital stock of a corporation created to
establish ATMs as provided in ORS 708A.160.
(2) An institution may invest its assets in shares of any
mutual fund, the assets of which are invested solely in obligations of the type
described in and limited under ORS 708A.115.
(3) An institution may, subject to the approval of the
director, acquire or continue to hold the fully paid stock of a corporation,
one of the purposes of which is to assist the institution in handling real
estate, claims, judgments or other assets or in holding title to the assets.
(4) An institution may acquire or continue to hold the
fully paid stock of a corporation the purpose of which is to permit the
institution to engage in any business in which a financial holding company, a bank holding company or a nonbank
subsidiary of a financial holding
company or a bank holding company is authorized to engage. This subsection
does not apply unless the institution is the owner of at least 80 percent of
the common stock of the subsidiary corporation, except qualifying shares of
directors.
(5) An institution may, subject to the approval of the
director and to rules promulgated by the director, acquire and continue to hold
at least 80 percent of the fully paid stock of a corporation engaged in any
business in which an institution is authorized to engage. Except as otherwise
permitted by statute or rule, the investment limitations applicable to the
institution apply to the subsidiary.
(6) An institution may, subject to the approval of the
director and under rules promulgated by the director, acquire and continue to
hold all the fully paid stock of a subsidiary corporation engaged in the
business of purchasing the stock of the institution for purposes of holding
that stock and making a market for that stock, if not more than 20 percent of
the net profit of the banking institution is disbursed to the subsidiary in any
one fiscal year. Except as otherwise permitted by statute or rule, the
investment limitations applicable to the institution apply to the subsidiary.
Acquisitions under this subsection shall not exceed 15 percent of the capital
of the institution.
(7) An institution may acquire and hold all or part of the
stock of a corporation that is or may thereafter be licensed under ORS 744.002
as an agent to transact one or more of the classes of insurance described in
ORS 744.115, except for title insurance, subject to the following requirements:
(a) The acquisition and holding of such stock shall be
subject to the approval of the director. The director shall base consideration
for approval on the condition of the institution, the adequacy of a formal
business plan for the insurance activities, and the existence of satisfactory
management for the corporation.
(b) The director may revoke or restrict the ongoing
authority of the institution to hold stock in the corporation if the condition
of the institution substantially deteriorates or if the insurance activities
are adversely affecting the institution.
(c) If the corporation conducts the insurance agency
activity in a branch or office in which the institution carries on its banking
business, the insurance agency activity shall be physically separated from
those parts of the premises in which the institution carries on the banking
business.
(d) No person who acts on behalf of the corporation to
transact insurance, as that term is defined in ORS 731.146, shall while
employed by the corporation engage on behalf of the corporation in any
activities relating to the making of loans or to the granting of other credits
to the customers of the corporation, including but not limited to serving as a
loan officer or as a member of a loan committee or other group charged with
approval of loans and other credits.
(e) The name of the corporation and any assumed business
name used by it shall not be identical to that of the institution.
(f) Prior to selling any policy of insurance, the
corporation shall give substantially the following notice in writing to the
purchaser in at least 10-point boldfaced type:
______________________________________________________________________________
NOTICE
_________ (Name of corporation licensed as an agent) is
owned by ___________ (Name of institution). You are not required to purchase
any insurance from it as a condition of obtaining any service from or engaging
in any transaction with the institution. Before committing to purchase any
policy of insurance, you should shop for the coverage by carefully comparing
information obtained from two or more agents on prices, benefits, services,
terms of renewal and other policy features. You hereby acknowledge receipt of a
copy of this notice.
__________________ ___________
Customer’s signature Date
______________________________________________________________________________
(g) For each calendar year during which an institution owns
all or part of any corporation licensed under ORS 744.002 as an agent, the
institution shall file a written report with the director. The report shall be
filed no later than March 31 of the following year and shall disclose the
insurance activities of the corporation. The required contents of the report
shall be established by the director by rule. The reports filed with the
director under this paragraph shall be available for public inspection in the
office of the director.
(h) The corporation shall not in any manner use customer
information obtained by the institution from another insurance agent to
promote, develop or solicit insurance business for the corporation unless the
other insurance agent consents to such use of the customer information.
(i) The corporation shall be subject to the limitations
applicable to lending institutions under ORS 746.180 and 746.185 to 746.211.
For the purpose of this paragraph, the term “lending institution” has the
meaning set forth in ORS 746.185.
(8) An institution may invest up to 15 percent of its
capital in the stock of the Oregon Capital Corporation authorized to be created
under ORS 284.750 to 284.795, 315.504, 317.084, 317.267 and 318.031.
SECTION 48.
ORS 708A.200 is amended to read:
708A.200. Nothing in ORS 708A.005, 708A.010, 715.075,
716.594, 716.610, 744.066, 744.115, 746.195 and 746.211 shall be construed to
permit a banking institution, a
financial holding company, a bank holding company or any subsidiary of a
banking institution, financial holding
company or bank holding company to act as insurer, as defined in ORS
731.106.
SECTION 49.
ORS 708A.565 is amended to read:
708A.565. Investments in stock of a company that engages in
activities in which a financial holding
company, a bank holding company or a non-banking subsidiary of a financial holding company or bank
holding company could engage under ORS 708A.120 (4) shall be carried on the
books of the institution at a value not exceeding 15 percent of the
stockholders’ equity of the institution.
SECTION 50.
ORS 717.210 is amended to read:
717.210. (1) ORS 717.200 to 717.320, 717.900 and 717.905 do
not apply to:
(a) Any company that accepts deposits in this state and
that is insured under the Federal Deposit Insurance Act, 12 U.S.C. 1811 et
seq., as amended.
(b) Credit unions or trust companies.
(c) The United States Government or any department, agency
or instrumentality thereof.
(d) The United States Postal Service.
(e) Any state or political subdivision of a state.
(f) The provision or electronic transfer of government
benefits for any federal, state or county government or other agency as defined
in the Federal Reserve Board Regulation E (12 C.F.R. part 205), by a contractor
for and on behalf of the United States Government or any department, agency or
instrumentality of the United States, or any state or any political subdivision
of a state.
(g) The provision or handling of electronic or other
transfer of escrowed moneys by an escrow agent licensed under ORS 696.511.
(h) Authorized delegates of a licensee, acting within the
scope of authority conferred by a written contract as described in ORS 717.270.
(i) Any bank holding company as defined in the federal Bank
Holding Company Act of 1956, 12 U.S.C. 1841 et seq., as amended, or any financial holding company as
defined in ORS 706.008.
(j) Any savings and loan holding company as defined in 12
U.S.C. 1467a (a)(1)(D), as amended.
(2) The Director of the Department of Consumer and Business
Services by rule or order may modify or waive the application of ORS 717.200 to
717.320, 717.900 and 717.905 to any person or group of persons if the director
determines that adequate regulation of the person or group of persons is
provided by law or by another agency of this state.
(3) The director by rule or order may temporarily suspend
the application of ORS 717.200 to 717.320, 717.900 and 717.905 to any person or
group of persons while the director considers whether an exemption should be
granted and during the pendency of any rulemaking proceeding proposing to
create an exemption.
SECTION 51.
ORS 744.061 is amended to read:
744.061. Nothing in the Insurance Code shall be construed
to limit or prohibit the licensing of a banking institution, as defined in ORS
706.008, a corporation owned in whole or part by a banking institution under
ORS 708A.120, 716.588 or 716.594, or a corporation owned in whole or part by a financial holding company or a bank
holding company, as defined in ORS 706.008, as an agent to transact one or more
of the classes of insurance described in ORS 744.115, except for title
insurance.
SECTION 52.
ORS 746.182 is amended to read:
746.182. (1) Prior to selling any policy of insurance,
other than a policy for a class of insurance referred to in subsection (2) of
this section:
(a) Any agent that is an institution as defined in ORS
706.008, shall give the purchaser the notice required under ORS 708A.005
(2)(e);
(b) Any agent that is a corporation, all or part of the
stock of which is held by an institution, shall give the purchaser the notice
required under ORS 708A.120 (7)(f);
(c) Any agent that is a corporation, all or part of the
stock of which is held by a financial
holding company or a bank holding company as defined in ORS 706.008, shall
give the purchaser the notice required under ORS 715.075 (6);
(d) Any agent that is a corporation, all or part of the
stock of which is held by a savings bank, as defined by ORS 706.008, shall give
the purchaser the notice required under ORS 716.594 (6); and
(e) Any agent that is a savings bank, as defined in ORS
706.008, shall give the purchaser the notice required under ORS 716.610
(10)(e).
(2) The requirement under subsection (1) of this section
does not apply to any policy for livestock insurance, mortgage insurance, motor
vehicle physical damage insurance, credit life insurance, credit health
insurance, credit involuntary unemployment insurance, credit insurance or
lender’s property insurance, as these classes of insurance are described in ORS
744.115.
SECTION 52a.
ORS 746.185 is amended to read:
746.185. As used in ORS 746.185 to 746.211, “lending
institution” means a financial institution,
financial holding company or bank holding company as those terms are
defined in ORS 706.008.
SECTION 53.
ORS 803.092 is amended to read:
803.092. (1) Except as otherwise provided in this section,
upon the transfer of any interest in a vehicle covered by an Oregon title the
transferee shall submit an application for title to the Department of
Transportation. Such application shall be submitted to the department within 30
days of the date of transfer of interest.
(2) Notwithstanding subsection (1) of this section,
application is not required under this section when:
(a) The change involves only a change in the security interest
where the security interest holder or lessor is a financial institution, a financial holding company or a bank
holding company, as those terms are defined in ORS 706.008, a licensee under
ORS chapter 725, or any subsidiary or affiliate of any of the foregoing and the
transfer of the interest of the security interest holder or lessor:
(A) Results from the merger, conversion, reorganization,
consolidation or acquisition of the security interest holder or lessor;
(B) Is to an entity that is a member of the same affiliated
group as the security holder or lessor; or
(C) Is made in connection with a transfer in bulk.
(b) The vehicle is transferred to a vehicle dealer and the
vehicle will become part of the dealer’s inventory for resale. Upon the
transfer of a vehicle to a dealer, however, the dealer shall immediately notify
the department of such transfer. This exemption from the requirement to apply
for title does not apply if the department determines that application for
title is necessary in order to comply with odometer disclosure requirements. If
the department determines that application for title is not required, it may
require filing of documents under ORS 803.126.
(c) The vehicle is to be titled in another jurisdiction.
(d) The vehicle has been totaled, wrecked, dismantled,
disassembled, substantially altered or destroyed, in which case the provisions
of ORS 819.010, 819.012, 819.014 or 822.135 relating to notice and surrender of
title documents shall be complied with.
(e) The transfer involves the creation or termination of a
leasehold interest in a vehicle that is proportionally registered under ORS
826.009 or 826.011, if the department is furnished with satisfactory proof of
the lease.
(3) Except as provided in subsection (2) of this section,
the transferee shall:
(a) Submit an application that meets requirements for title
under ORS 803.045 and 803.050 and any applicable rules of the department.
(b) Submit the title transfer fees as required under ORS
803.090.
(c) Comply with the provisions of ORS 803.065 and any
applicable rules of the department under that statute and submit the duplicate
or replacement title fee as provided under ORS 803.090, if the transfer
includes an application for duplicate or replacement title and transfer of title.
(d) Submit an odometer disclosure containing information
required by the department for the kind of transaction involved.
(e) Submit any late presentation of certificate of title
fee as provided under ORS 803.090 if such fee is required under ORS 803.105.
(4) For purposes of this section:
(a) “Affiliated group” has the meaning given to the term in
section 1504(a) of the Internal Revenue Code of 1986, as amended (26 U.S.C.
1504(a)).
(b) A “transfer in bulk” is:
(A) The sale or assignment of, the grant of a security
interest in, or any other transfer of either a group of loans secured by
vehicles, leases of vehicles or both or a participation or other interest in
the group of loans;
(B) The creation of asset-backed securities or other
securing of assets involving the loans or leases; or
(C) Any similar transaction involving the loans or leases.
SECTION 54.
ORS 803.220 is amended to read:
803.220. (1) A person commits the offense of unlawful
failure to notify the Department of Transportation of a name and address change
if the person:
(a) Has any interest in a vehicle registered or titled by
this state that is shown on the title;
(b) Changes names, by marriage or otherwise, from that
shown on the title or changes the person’s address from that shown on the
registration; and
(c) Does not comply with the requirements under this
section.
(2) To comply with the requirements of this section, a
person must do all the following:
(a) The person must notify the department of the change.
Notice of a change of name or address must be given to the department within 30
days of the change.
(b) If the person changes names, by marriage or otherwise,
from that shown on the title and a certificate of title is being held by a
security interest holder, the person must notify the security interest holder
within 30 days after the change who, in turn, must notify the department in a
timely manner.
(c) Any time the name is changed from that on the title,
any certificate of title that has been issued must be submitted to the
department with the notice and the appropriate fee under ORS 803.090.
(3) A person may obtain a new certificate of title
reflecting a change of name or address by making application therefor and
paying the appropriate fee under ORS 803.090.
(4) If title has been issued in a form other than a
certificate, a person requesting a change in name shall provide authorization
from the primary security interest holder, if any, to have the title changed.
If the authorization is not received, the department shall continue to reflect
the previous name on the title. Nothing in this subsection precludes the
department from including the new name in records maintained in conjunction
with title whether or not authorization is received.
(5) Upon receipt of notice of a change and any
authorization required under this section, the department shall note the change
in its records. Upon receipt of the notice and the fee required under ORS
803.090, the department shall issue a new certificate of title indicating the
change.
(6) This section does not apply to a change of name or
address of a security interest holder or lessor that is a financial institution, a financial holding company or a bank
holding company, as those terms are defined in ORS 706.008, a licensee under ORS
chapter 725, or any subsidiary or affiliate of any of the foregoing.
(7) The offense described in this section, unlawful failure
to notify the department of a name or address change, is a Class D traffic
violation.
SECTION 55.
ORS 310.651 is amended to read:
310.651. For purposes of ORS 310.652:
(1) “Evidence of debt” means all bonds, notes, demands,
claims, deposits or investments however evidenced and whether secured by
mortgage, deed of trust, judgment or otherwise or not so secured, and includes
but is not limited to:
(a) Personal and business notes receivable.
(b) Mortgage notes receivable.
(c) Commercial paper.
(d) Conditional sales contracts (written agreements whereby
title to the property remains with the seller until the goods are paid for).
(e) Notes and other receivables, evidenced by written
agreement, due from affiliated companies.
(f) Participation certificates.
(g) Bonds and debentures of both domestic and foreign
corporations.
(h) Bonds and evidence of debt of other states and their
political subdivisions.
(i) Bonds, debentures and capital notes (not certificates
of deposit) issued by banks and other organizations in direct competition with
banks.
(j) Cashiers’ checks, treasurers’ checks, certified checks,
purchase drafts and similar instruments drawn for the benefit or convenience of
any party or parties other than banks.
(k) Investment contracts and accumulation plans issued by
investment syndicates, investment brokers and other similar companies.
(L) Loans, advances, demands, claims and other receivables
which are evidenced by written agreement.
(2) “Funds on deposit” means all funds accrued or accruing
by virtue of the death of the insured or the original maturity of a policy
contract where the party or parties entitled to receive such funds might
withdraw same at their option upon stipulated notice.
(3) “Money on deposit” means money, whether actually within
or without this state, having a business, commercial or taxable situs in this
state, without deduction for any indebtedness or liabilities of the taxpayer,
and includes but is not limited to:
(a) Amounts in checking and savings accounts.
(b) Certificates of deposit.
(c) Payroll and escrow accounts.
(d) Deposits as of any one or more of the four quarterly
valuation dates.
(e) Deposits of trustees, executors, administrators and
other fiduciaries.
(f) Social security and withholding tax accounts.
(g) Accommodation loan accounts.
(h) Deposits of savings and loan or building and loan
associations.
(i) Deposits of insurance companies.
(4) “Money on hand” includes but is not limited to:
(a) Currency and bills of exchange.
(b) Money in cash registers.
(c) Petty cash.
(d) Deposits in transit.
(e) Money in safe deposit boxes.
(5) “Shares of stock” includes but is not limited to:
(a) Capital stock, common stock and preferred stock of both
domestic and foreign corporations.
(b) Shares of stock held in brokerage accounts, including
shares purchased on margin.
(c) Unregistered stock, restricted stock, letter stock and
stocks owned in “closed” corporations.
(d) Shares in mutual funds and investment trusts.
(e) Shares of stock in banks (including national banks).
(f) Shares of stock in holding companies, including financial holding companies, bank holding companies and insurance holding
companies.
(g) Stocks held by trustees or guardians which should be
reported under the names of the beneficiary.
(h) Stocks held by executors or administrators of estates
which should be reported in the name of the estate.
(i) Stocks owned by minor children which should be reported
under the minor’s name, in care of the parent or guardian.
(j) Stocks owned by investment clubs which should be
reported in the name of the investment club.
(k) Stocks acquired by purchase, gift, inheritance or any
other means, even if the stock certificates have not been received and are not
in the taxpayer’s possession as of the asset determination date.
(L) Shares of stock owned by or registered to residents of
this state even though the stock certificates may be physically located in
another state.
SECTION 56.
ORS 706.015 is amended to read:
706.015. References in the Bank Act to federal statutes and
regulations shall, except as otherwise provided in the Bank Act, be construed
to refer to the statutes or regulations as they are in effect on [October 23, 1999] January 1, 2002. The Director of the Department of Consumer and
Business Services may adopt rules providing that one or more of the federal
statutes and regulations shall be construed to refer to the statutes and
regulations as they are in effect on a later date.
SECTION 57.
ORS 731.450 is amended to read:
731.450. Except as
authorized by the federal Gramm-Leach-Bliley Act (P.L. 106-102), [no] an
insurer [shall] may not engage in any business except the making of insurance or a
kind of business related to the insurance business. However, a foreign or alien
insurer may engage, outside this state, in any business permitted by its
articles of incorporation and the laws of the state of its domicile; and a
title insurer also may engage in business as an escrow agent; provided,
however, that a title insurer engaging in business as an escrow agent shall be
subject to the provisions of ORS 696.505 to 696.590 in respect to its escrow
activities.
SECTION 58.
ORS 707.262 is amended to read:
707.262. (1)
Subject to any provisions set forth in its articles of incorporation and
subject to preemptive rights, if any, of existing shareholders, an institution
or Oregon stock savings bank may create and issue, whether or not in connection
with the issuance and sale of any of its shares or other securities, rights or
options entitling the holders thereof to purchase from the institution or
Oregon stock savings bank shares of any class or classes. Such rights or
options shall be evidenced in such manner as the board of directors shall
approve and, subject to the provisions of the articles of incorporation, shall
set forth the terms upon which, the time or times within which and the price or
prices at which such shares may be purchased from the institution or Oregon
stock savings bank on the exercise of any such right or option.
(2) [No such] The rights or options [shall]
described in subsection (1) of this
section may not be issued to a director, officer or employee of the
institution or Oregon stock savings bank or of any subsidiary thereof unless
the issuance:
(a) Is to all
shareholders of the institution, Oregon stock savings bank or subsidiary
thereof;
(b) Is approved at the annual
meeting or a special meeting by the holders of at least two-thirds of the
outstanding shares entitled to vote thereon[,
or unless such issuance]; or
(c) Is pursuant to a plan
previously so approved.
(3) In the
absence of fraud in the transaction, the judgment of the board of directors as
to the adequacy of the consideration received for [such] the rights or
options described in subsection (1) of
this section shall be conclusive.
SECTION 59.
ORS 731.740 is repealed.
SECTION 60.
Sections 61 and 62 of this 2001 Act are
added to and made a part of ORS chapter 656.
SECTION 61.
Insurers and their assigned claims
agents shall maintain the confidentiality of worker medical and vocational
claim records. Worker medical and vocational claim records may not be disclosed
to persons other than the worker unless the disclosure is:
(1) Made with the
consent of the worker or the worker’s beneficiary;
(2) Reasonably necessary
for the insurer or its assigned claims agent to manage, defend or adjust
claims, suits or actions or to perform any other function required by or
arising out of ORS chapter 654, 655 or 656 or the insurance contract;
(3) To detect or prevent
criminal activity, fraud, material misrepresentation or nondisclosure;
(4) Pursuant to a
written agreement that requires the receiving party to maintain the
confidentiality of the records; or
(5) Otherwise required
or permitted by law.
SECTION 62.
(1) A cause of action in the nature of
defamation, invasion of privacy or negligence may not arise against:
(a) Any insurer or
assigned claims agent for disclosing worker medical and vocational claim
records in accordance with section 61 of this 2001 Act; or
(b) Any person for
furnishing worker medical and vocational claim records to an insurer or
assigned claims agent in accordance with section 61 of this 2001 Act.
(2) Subsection (1) of
this section does not apply to the disclosure or furnishing of false
information with malice or willful intent to injure any person.
SECTION 63.
ORS 656.268 is amended to read:
656.268. (1) One purpose of this chapter is to restore the
injured worker as soon as possible and as near as possible to a condition of
self support and maintenance as an able-bodied worker. The insurer or
self-insured employer shall close the worker’s claim, as prescribed by the
Director of the Department of Consumer and Business Services, and determine the
extent of the worker’s permanent disability, provided the worker is not
enrolled and actively engaged in training according to rules adopted by the
director pursuant to ORS 656.340 and 656.726, when:
(a) The worker has become medically stationary and there is
sufficient information to determine permanent impairment;
(b) The accepted injury is no longer the major contributing
cause of the worker’s combined or consequential condition or conditions
pursuant to ORS 656.005 (7). When the claim is closed because the accepted
injury is no longer the major contributing cause of the worker’s combined or
consequential condition or conditions, and there is sufficient information to
determine permanent impairment, the likely impairment and adaptability that
would have been due to the current accepted condition shall be estimated; or
(c) Without the approval of the attending physician, the
worker fails to seek medical treatment for a period of 30 days or the worker
fails to attend a closing examination, unless the worker affirmatively
establishes that such failure is attributable to reasons beyond the worker’s
control.
(2) If the worker is enrolled and actively engaged in
training according to rules adopted pursuant to ORS 656.340 and 656.726, the
temporary disability compensation shall be proportionately reduced by any sums
earned during the training.
(3) A copy of all medical reports and reports of vocational
rehabilitation agencies or counselors shall be furnished to the worker [and to the employer], if requested by
the worker [or employer].
(4) Temporary total disability benefits shall continue
until whichever of the following events first occurs:
(a) The worker returns to regular or modified employment;
(b) The attending physician advises the worker and
documents in writing that the worker is released to return to regular
employment;
(c) The attending physician advises the worker and
documents in writing that the worker is released to return to modified
employment, such employment is offered in writing to the worker and the worker
fails to begin such employment; or
(d) Any other event that causes temporary disability
benefits to be lawfully suspended, withheld or terminated under ORS 656.262 (4)
or other provisions of this chapter.
(5)(a) Findings by the insurer or self-insured employer
regarding the extent of the worker’s disability in closure of the claim shall
be pursuant to the standards prescribed by the Director of the Department of
Consumer and Business Services. The insurer or self-insured employer shall
issue a notice of closure of such a claim to the worker, to the worker’s
attorney if the worker is represented, and to the director. The notice must
inform:
(A) The parties, in boldfaced type, of the proper manner in
which to proceed if they are dissatisfied with the terms of the notice;
(B) The worker of the amount of any further compensation,
including permanent disability compensation to be awarded; of the duration of
temporary total or temporary partial disability compensation; of the right of
the worker to request reconsideration by the director under this section within
60 days of the date of the notice of claim closure; of the aggravation rights;
and of such other information as the director may require; and
(C) Any beneficiaries of death benefits to which they may
be entitled pursuant to ORS 656.204 and 656.208.
(b) If the worker has returned to work but the insurer or
self-insured employer has not issued a notice of closure, the worker may
request closure. Within 10 days of receipt of a written request from the
worker, the insurer or self-insured employer shall issue a notice of closure if
the requirements of this section have been met or a notice of refusal to close
if the requirements of this section have not been met. A notice of refusal to
close shall advise the worker of the decision not to close; of the right of the
worker to request a hearing pursuant to ORS 656.283 within 60 days of the date
of the notice of refusal to close the claim; of the right to be represented by
an attorney; and of such other information as the director may require.
(c) If a worker objects to the notice of closure, the
worker first must request reconsideration by the director under this section.
The request for reconsideration must be made within 60 days of the date of the
notice of closure.
(d) If an insurer or self-insured employer has closed a
claim or refused to close a claim pursuant to this section, if the correctness
of that notice of closure or refusal to close is at issue in a hearing on the
claim and if a finding is made at the hearing that the notice of closure or
refusal to close was not reasonable, a penalty shall be assessed against the
insurer or self-insured employer and paid to the worker in an amount equal to
25 percent of all compensation determined to be then due the claimant.
(e) If, upon reconsideration of a claim closed by an
insurer or self-insured employer, the director orders an increase by 25 percent
or more of the amount of compensation to be paid to the worker for either a
scheduled or unscheduled permanent disability and the worker is found upon
reconsideration to be at least 20 percent permanently disabled, a penalty shall
be assessed against the insurer or self-insured employer and paid to the worker
in an amount equal to 25 percent of all compensation determined to be then due
the claimant. If the increase in compensation results from new information
obtained through a medical arbiter examination or from the adoption of a
temporary emergency rule, the penalty shall not be assessed.
(6)(a) Notwithstanding any other provision of law, only one
reconsideration proceeding may be held on each notice of closure. At the
reconsideration proceeding, the worker or the insurer or self-insured employer
may correct information in the record that is erroneous and may submit any
medical evidence that should have been but was not submitted by the attending
physician at the time of claim closure. If the director determines that a claim
was not closed in accordance with subsection (1) of this section, the director
may rescind the closure.
(b) If necessary, the director may require additional
medical or other information with respect to the claims and may postpone the
reconsideration for not more than 60 additional calendar days.
(c) In any reconsideration proceeding under this section in
which the worker was represented by an attorney, the director shall order the
insurer or self-insured employer to pay to the attorney, out of the additional
compensation awarded, an amount equal to 10 percent of any additional
compensation awarded to the worker.
(d) The reconsideration proceeding shall be completed
within 18 working days from the date the reconsideration proceeding begins, and
shall be performed by a special evaluation appellate unit within the
department. The deadline of 18 working days may be postponed by an additional
60 calendar days if within the 18 working days the department mails notice of
review by a medical arbiter. If an order on reconsideration has not been mailed
on or before 18 working days from the date the reconsideration proceeding
begins, or within 18 working days plus the additional 60 calendar days where a
notice for medical arbiter review was timely mailed or the director postponed
the reconsideration pursuant to paragraph (b) of this subsection, or within
such additional time as provided in subsection (7) of this section when
reconsideration is postponed further because the worker has failed to cooperate
in the medical arbiter examination, reconsideration shall be deemed denied and
any further proceedings shall occur as though an order on reconsideration
affirming the notice of closure was mailed on the date the order was due to
issue.
(e) The period for completing the reconsideration
proceeding described in paragraph (d) of this subsection begins upon receipt by
the director of a worker’s request for reconsideration pursuant to subsection
(5)(c) of this section. The insurer may fully participate in the reconsideration
proceeding.
(f) Any medical arbiter report may be received as evidence
at a hearing even if the report is not prepared in time for use in the
reconsideration proceeding.
(g) If any party objects to the reconsideration order, the
party may request a hearing under ORS 656.283 within 30 days from the date of
the reconsideration order.
(7)(a) If the basis for objection to a notice of closure
issued under this section is disagreement with the impairment used in rating of
the worker’s disability, the director shall refer the claim to a medical
arbiter appointed by the director.
(b) If neither party requests a medical arbiter and the
director determines that insufficient medical information is available to
determine disability, the director may refer the claim to a medical arbiter
appointed by the director.
(c) At the request of either of the parties, a panel of
three medical arbiters shall be appointed.
(d) The arbiter, or panel of medical arbiters, shall be
chosen from among a list of physicians qualified to be attending physicians
referred to in ORS 656.005 (12)(b)(A) who were selected by the director in
consultation with the Board of Medical Examiners for the State of Oregon and
the committee referred to in ORS 656.790.
(e)(A) The medical arbiter or panel of medical arbiters may
examine the worker and perform such tests as may be reasonable and necessary to
establish the worker’s impairment.
(B) If the director determines that the worker failed to
attend the examination without good cause or failed to cooperate with the
medical arbiter, or panel of medical arbiters, the director shall postpone the
reconsideration proceedings for up to 60 days from the date of the
determination that the worker failed to attend or cooperate, and shall suspend
all disability benefits resulting from this or any prior opening of the claim
until such time as the worker attends and cooperates with the examination or
the request for reconsideration is withdrawn. Any additional evidence regarding
good cause must be submitted prior to the conclusion of the 60-day postponement
period.
(C) At the conclusion of the 60-day postponement period, if
the worker has not attended and cooperated with a medical arbiter examination
or established good cause, there shall be no further opportunity for the worker
to attend a medical arbiter examination for this claim closure. The
reconsideration record shall be closed, and the director shall issue an order
on reconsideration based upon the existing record.
(D) All disability benefits suspended pursuant to this
subsection, including all disability benefits awarded in the order on
reconsideration, or by an Administrative Law Judge, the Workers’ Compensation
Board or upon court review, shall not be due and payable to the worker.
(f) The costs of examination and review by the medical
arbiter or panel of medical arbiters shall be paid by the insurer or
self-insured employer.
(g) The findings of the medical arbiter or panel of medical
arbiters shall be submitted to the director for reconsideration of the notice
of closure.
(h) After reconsideration, no subsequent medical evidence
of the worker’s impairment is admissible before the director, the Workers’
Compensation Board or the courts for purposes of making findings of impairment
on the claim closure.
(i)(A) When the basis for objection to a notice of closure
issued under this section is a disagreement with the impairment used in rating
the worker’s disability, and the director determines that the closure was not
made pursuant to this section, the director is not required to appoint a
medical arbiter prior to the completion of the reconsideration proceeding.
(B) If the worker’s condition has substantially changed
since the notice of closure, upon the consent of all the parties to the claim,
the director shall postpone the proceeding until the worker’s condition is
appropriate for claim closure under subsection (1) of this section.
(8) No hearing shall be held on any issue that was not
raised and preserved before the director at reconsideration. However, issues
arising out of the reconsideration order may be addressed and resolved at
hearing.
(9) If, after the notice of closure issued pursuant to this
section, the worker becomes enrolled and actively engaged in training according
to rules adopted pursuant to ORS 656.340 and 656.726, any permanent disability
payments due under the closure shall be suspended, and the worker shall receive
temporary disability compensation while the worker is enrolled and actively
engaged in the training. When the worker ceases to be enrolled and actively
engaged in the training, the insurer or self-insured employer shall again close
the claim pursuant to this section if the worker is medically stationary or if
the worker’s accepted injury is no longer the major contributing cause of the
worker’s combined or consequential condition or conditions pursuant to ORS
656.005 (7). The closure shall include the duration of temporary total or
temporary partial disability compensation. Permanent disability compensation
shall be redetermined for unscheduled disability only. If the worker has
returned to work or the worker’s attending physician has released the worker to
return to regular or modified employment, the insurer or self-insured employer
shall again close the claim. This notice of closure may be appealed only in the
same manner as are other notices of closure under this section.
(10) If the attending physician has approved the worker’s
return to work and there is a labor dispute in progress at the place of
employment, the worker may refuse to return to that employment without loss of
reemployment rights or any vocational assistance provided by this chapter.
(11) Any notice of closure made under this section may
include necessary adjustments in compensation paid or payable prior to the
notice of closure, including disallowance of permanent disability payments
prematurely made, crediting temporary disability payments against current or
future permanent or temporary disability awards or payments and requiring the
payment of temporary disability payments which were payable but not paid.
(12) An insurer or self-insured employer may take a credit
or offset of previously paid workers’ compensation benefits or payments against
any further workers’ compensation benefits or payments due a worker from that
insurer or self-insured employer when the worker admits to having obtained the
previously paid benefits or payments through fraud, or a civil judgment or
criminal conviction is entered against the worker for having obtained the previously
paid benefits through fraud. Benefits or payments obtained through fraud by a
worker shall not be included in any data used for ratemaking or individual
employer rating or dividend calculations by a guaranty contract insurer, a
rating organization licensed pursuant to ORS chapter 737, the State Accident
Insurance Fund Corporation or the director.
(13)(a) An insurer or self-insured employer may offset any
compensation payable to the worker to recover an overpayment from a claim with
the same insurer or self-insured employer. When overpayments are recovered from
temporary disability or permanent total disability benefits, the amount
recovered from each payment shall not exceed 25 percent of the payment, without
prior authorization from the worker.
(b) An insurer or self-insured employer may suspend and
offset any compensation payable to the beneficiary of the worker, and recover
an overpayment of permanent total disability benefits caused by the failure of
the worker’s beneficiaries to notify the insurer or self-insured employer about
the death of the worker.
(14) Conditions that are direct medical sequelae to the
original accepted condition shall be included in rating permanent disability of
the claim unless they have been specifically denied.
SECTION 64.
This 2001 Act being necessary for the
immediate preservation of the public peace, health and safety, an emergency is
declared to exist, and this 2001 Act takes effect on its passage.
Approved by the Governor
June 15, 2001
Filed in the office of
Secretary of State June 15, 2001
Effective date June 15, 2001
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