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What's New: Government Affairs

Federal Agencies Begin to Implement New Law on Individual Sureties

Tuesday, December 6, 2016  
   Federal Agencies Begin to Implement New Law on Individual Sureties

Federal agencies have begun to implement the change in the law for the assets that individual sureties can pledge. The Federal Acquisition Regulation (FAR) Council recently opened a FAR case and tasked its staff with developing amendments to the regulations regarding individual sureties. This will implement a change in the law that now requires individual sureties to pledge only “eligible obligations,” which are instruments backed by the federal government, to back their bonds. The new law also requires such assets to be deposited with the federal government. SFAA will review the proposed regulations when they are issued and submit comments to ensure that the law is implemented as intended.

In a separate action, the U.S. Department of the Treasury recently issued a Frequent Asked Questions (FAQs) document to explain what kinds of assets individual sureties can pledge and the process for placing the assets in a new individual account with the Federal Reserve Bank in St. Louis. SFAA submitted recommendations to clarify the FAQs with regard to the kinds of assets that can be pledged and to ensure that the FAQs only apply to individual sureties and not corporate sureties. We also noted that changes to the FAR still are needed.

Members should visit Government Relations / General Info (Members) for more information.



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