Voluntary Testing and Enrollment for a New Method of Submitting Applications, Notices, and Other Requests for Regulatory Authorization

Summary:

The Board of Governors of the Federal Reserve System (Federal Reserve) proposes to implement an electronic system for the submission of applications, notices, and other requests for regulatory authorization to the Federal Reserve System by insured depository institutions, bank holding companies (BHCs), foreign banking organizations (FBOs), other entities, individuals, or groups (collectively, filers) under the Federal Reserve Act, Bank Holding Company Act, Bank Merger Act, Change in Bank Control Act, the International Banking Act of 1978, and the Federal Reserve's regulations implementing these statutes. As a part of this process the Federal Reserve would implement an authentication system to authorize filers and their designated agents to access the Electronic Applications system (E-Apps) and submit filings. To identify any unresolved issues with (E-Apps), the Federal Reserve proposes to establish a testing program involving a limited number of filers that would be willing to provide written and oral feedback regarding the authentication and testing processes.

Dates:

Pilot Phase Timeframe: Second and Third Quarters 2008.

System Enrollment and Implementation Phase Timeframe: Beginning Fourth Quarter 2008.

For further information contact:

Michael Sexton, Manager (202-452-3009) or Vaishali Sack, Supervisory Financial Analyst (202-452-5221), Division of Banking Supervision and Regulation, Board of Governors of the Federal Reserve System; Michelle Shore, Federal Reserve Board Clearance Officer (202-452-3829), Division of Research and Statistics, Board of Governors of the Federal Reserve System, Washington, DC 20551. For users of Telecommunications Device for the Deaf (“TDD”) only, contact (202) 263-4869.

Supplementary information:

I. Background

The Federal Reserve is developing an electronic system for the submission of applications, notices, and other requests for regulatory authorization (collectively, filings) by filers to the Federal Reserve. The Government Paperwork Elimination Act of 1998 (GPEA) generally requires federal executive agencies to use electronic forms and electronic filings to conduct official business with the public when practicable. The Federal Reserve, which complies with GPEA, has elected to provide a web-based system for the electronic submission of filings, in order to reduce substantially the Federal Reserve's reliance on its current, paper-based submission processes. This electronic system, E-Apps, is currently under development.

Although the use of E-Apps would be voluntary for filers, the Federal Reserve anticipates that the electronic submission of filings through E-Apps would reduce the burden filers experience with current requirements for paper-based submissions. Therefore, filers who voluntarily choose to submit filings through E-Apps would save the time and expense associated with photocopying and mailing or otherwise filing copies.

In order to provide sufficient assurances of authentication, data integrity, data confidentiality and non-repudiation, and sufficient security for the information transmitted in filed documents, filers and their designated agents must be authenticated to access E-Apps and submit filings to the Federal Reserve. Filers or their designated representatives (employees or agents) who elect to submit filings through E-Apps will be required to first obtain digital certificates from the Federal Reserve. The process for requesting certificates will be similar to the process currently in place for using certain financial services provided by the Federal Reserve. Information, forms, and instructions regarding the certificate request process will be available on the Federal Reserve's public Web site (http://www.federalreserve.gov/).

II. Testing and Enrollment

This notice announces the voluntary testing and mandatory enrollment for E-Apps. Enrollment is mandatory only if the filer elects to use the E-Apps system. As discussed below, the testing and enrollment will be conducted in two phases: The Pilot phase and the System Enrollment and Implementation phase. The Federal Reserve anticipates that the phases will be conducted according to the following schedule: The Pilot phase would be conducted for approximately two months during the second quarter of 2008. The System Enrollment and Implementation phase would begin in the fourth quarter of 2008 with Enrollment and continue with Implementation beginning in the first quarter of 2009.

As part of the testing, each participating filer would be expected to enroll in E-Apps. The Federal Reserve would issue digital certificates to properly documented subscribers.

Pilot Phase: This phase would begin approximately in June 2008 and would be conducted for two months. The Pilot phase would include approximately twenty filers and subscribers (individuals who are authorized to submit filings on behalf of filers) as voluntary participants. Participants in the Pilot phase would access the E-Apps system and would submit at least one filing through the E-Apps system on behalf of each filer.

The Federal Reserve would distribute filing instructions to each participating filer and subscriber and provide assistance as necessary. Pilot phase participants would be asked to provide written and oral feedback regarding the certificate and filing processes, the E-Apps system, and any customer support they receive during the Pilot phase. The comments and recommendations received from the participants would be analyzed to identify issues. The Pilot phase, along with the feedback, would help the Federal Reserve identify any unresolved issues with the E-Apps system before the System Enrollment and Implementation Timeframe.

System Enrollment and Implementation Phase: Enrollment in the E-Apps System would be available for all filers and their designated representatives (employees or agents) beginning in the fourth quarter of 2008, and would be mandatory for filers who want to submit filings to the Federal Reserve through E-Apps. Filers and subscribers that participated in the Pilot phase would be able to submit filings using the certificates previously issued to them. All other filers and their designated representatives would be required to submit the appropriate paperwork and follow the digital certificate request procedures outlined above. Implementation of the E-Apps System would begin in the first quarter of 2009.

Board of Governors of the Federal Reserve System, April 24, 2008. Robert deV. Frierson,

Deputy Secretary of the Board.

References

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