Title: POLICY STATEMENT--Policy Statement on Regulatory Philosophy
Issue Date: 05/16/1995
Federal Register Cite: 60 FR 26034
FARM CREDIT ADMINISTRATION
Policy Statement on Regulatory Philosophy
AGENCY: Farm Credit Administration.
ACTION: Policy statement.
SUMMARY: The Farm Credit Administration (FCA) Board reaffirmed the Policy Statement on Regulatory Philosophy (59 FR 32189, June 22, 1994) in order to assist in the creation of an environment which promotes the confidence of customer/shareholders, investors and the public in the Farm Credit System's (System) financial strength and future viability. The FCA recommitted to promulgate regulations only as required by law, as necessary to interpret the law, or as necessary to promote the safe and sound operation of System institutions.
EFFECTIVE DATE: May 9, 1995.
FOR FURTHER INFORMATION CONTACT: Floyd Fithian, Secretary to the Farm Credit Administration Board, Farm Credit Administration, McLean, Virginia 22102-5090, (703) 883-4000, TDD (703) 883-4444.
SUPPLEMENTARY INFORMATION: The text of the Board's policy statement on regulatory philosophy is set forth below in its entirety:FCA Board Action on Policy Statement on Regulatory Philosophy, BM-09-MAY-95-03, FCA-PS-59
Effective Date: May 9, 1995.
Effect on Previous Action: Replaces BM-17-FEB-94-02 [FCA-PS-59]
Sources of Authority: Farm Credit Act of 1971, as amended; 12 U.S.C. 2001 et seq.
The FCA Board adopts the edited version and reaffirms the policy statement on regulatory philosophy as follows:
The FCA shall develop regulations consistent with its authorities under the Farm Credit Act of 1971 (Act), as amended, and other relevant statutes. It is the FCA Board's philosophy to promulgate regulations that are necessary to implement the law and to promote the safety and soundness of the Farm Credit System (System).
In general, the Board's regulatory objective will be to: Create an environment that promotes the confidence of customer/shareholders and investors and the public in the Farm Credit System's financial strength and future viability and grants System institutions the maximum flexibility consistent with this purpose to offer high quality, reasonably priced credit and other services to customer/shareholders. The FCA Board believes that safe and sound operations of System institutions will promote the following: (a) Investor confidence in System debt securities, which works to ensure adequate funds at reasonable rates for lending to customer/shareholders; and, (b) customer/shareholder confidence in each cooperatively owned System institution, which works to ensure adequate market share and sufficient capital. To effectively achieve its objective, the FCA will:
1. Promulgate regulations only as required by law, as necessary to interpret the law, or as necessary to promote the safe and sound operation of System institutions.
2. Work to eliminate outdated regulations and ensure that its regulations implement the purposes of the law without unnecessary burden or cost. The FCA will adopt its regulatory approach based on a reasoned determination that the benefits of the intended regulations justify their cost.
3. Strive to ensure that each regulation has a well-defined objective and addresses specifically identified risks or problems. Preambles to regulation will explain the FCA Board's rationale for the regulatory solution adopted.
4. Promulgate regulations that, to the extent feasible, specify performance criteria and objectives rather than operational methods for achieving their purposes. Operational constraints imposed by regulation should be based on specific statutory requirements or the achievement of regulatory objectives.
5. Give high priority to issues that pose the greatest risk within the Farm Credit System.
6. Consider policy positions of the other financial regulators to determine whether consistency would facilitate the objectives of the Act or whether a different approach is warranted.
7. Draft its regulations and policy statements to be clear and easy to understand, with the goal of minimizing the potential for ambiguity, uncertainty, and resultant litigation.
8. Utilize innovative approaches to seeking the public's perspective regarding regulatory proposals in appropriate circumstances. The FCA Board will consider these principles as it develops new regulatory initiatives and as it reviews existing regulations to determine whether they continue to be necessary and effective. The FCA Board is committed to thoughtfully evaluating competing considerations to arrive at its regulatory judgments.
Adopted this 9th day of May, 1995 by order of the Board.
Dated May 10, 1995.
Secretary, Farm Credit Administration Board.
[FR Doc. 95-12016 Filed 5-15-95; 8:45 am]
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