Category Archives: Federal Regulations

PCA Summary of FDA’s Proposed New Requirements for Tobacco Product Manufacturing Practices

OFFICE OF GOVERNMENT AFFAIRS FOR THE PREMIUM CIGAR ASSOCIATION

PCA Summary of FDA’s Proposed New Requirements for Tobacco Product Manufacturing Practices

 

[Washington, DC — Tue, March 14, 2023] The Premium Cigar Association has completed its initial analysis of the Proposed Rule for Tobacco product Manufacturing Practices published in the Federal Register on March 10th, 2023. The nearly 300-page document contains several provisions that will affect the “business of specialty tobacco retailing” both domestically in the United States and commerce internationally. Because a federal court has held that the FDA acted arbitrarily and capriciously in deeming premium cigars subject to the Act, it is the PCA’s position that FDA lacks jurisdiction to apply this rule to premium cigars. The PCA will urge the agency, and if necessary, the courts, to make clear that the proposed rule should not, cannot, and will not reach premium cigars. Furthermore, the proposed rule has several fundamental flaws in it that would inordinately harm smaller manufactures and lead to overall market contraction that would limit the products offered on retail shelves.

 

This is an economically significant rule that aims to apply a combination of standards used in the pharmaceutical and foods industries to tobacco products. This rule is far reaching in that it sets standards on international companies producing tobacco products and threatens to block importations of these products if the factories do not comply with widespread mandates that range from environmental standards to requiring the use of certain building materials. If the rule were to be implemented as written, you could expect the boutique cigar factories to be hit the hardest as well as producers of pipe tobacco.

 

The association is convening a working group of premium cigar manufactures and discussing the specifics of the proposed rule with our legal and regulatory teams to discuss the best course of action. The comment period will be open for at least 180 days and the association will be submitting a comment or comments. The scope of the comment(s) will be determined in the coming days after the proposed rule is fully vetted by relevant stakeholders and feedback is solicited/analyzed.

CFPB Issues Final Rule to Facilitate Transition from LIBOR

FOR IMMEDIATE RELEASE:
December 7, 2021

MEDIA CONTACT:
Office of Communications
Tel: (202) 435-7170

CFPB Issues Final Rule to Facilitate Transition from LIBOR

WASHINGTON, D.C. – The Consumer Financial Protection Bureau (CFPB) today finalized a rule facilitating the transition away from the LIBOR interest rate index for consumer financial products. The rule establishes requirements for how creditors must select replacement indices for existing LIBOR-linked consumer loans after April 1, 2022. No new financial contracts may reference LIBOR as the relevant index after the end of 2021. Starting in June 2023, LIBOR can no longer be used for existing financial contracts. The transition away from LIBOR was set into motion after a criminal rate-setting conspiracy implicated large international banks and undermined public confidence in the index. Approximately $1.4 trillion of consumer loans are estimated to be currently tied to LIBOR.

“The criminal manipulation of LIBOR by global financial institutions was extremely costly to our country,” said CFPB Director Rohit Chopra. “LIBOR will soon be a relic of history, and we will be working to ensure that companies make an orderly transition away from this index.”

Read Director Chopra’s statement on the transition from LIBOR.

The final rule, effective April 1, 2022, includes closed-end credit provisions that require creditors to choose an index comparable to LIBOR when changing the index of a variable rate loan, or consider it a refinancing for purposes of Regulation Z. To help creditors determine a comparable index for closed-end loans, the rule identifies certain Secured Overnight Financing Rate (SOFR)-based spread-adjusted indices recommended by the Alternative Reference Rates Committee (ARRC) for consumer products as examples to illustrate a reference rate that would be comparable to replace 1-month, 3-month, or 6-month tenors of USD LIBOR. Another closed-end credit provision of the final rule includes a non-exhaustive list of factors for creditors to help determine whether a replacement index meets the Regulation Z “comparable” standard regarding a particular LIBOR index. The rule also updates post-consummation disclosure sample forms for certain adjustable-rate mortgage loan products replacing LIBOR references with a SOFR index.

For open-end loans, the rule adds LIBOR-specific provisions to permit creditors or card issuers for HELOCs and credit card accounts to replace the LIBOR index and adjust the margin used to set a variable rate on or after April 1, 2022, if certain conditions are met. The creditor or card issuer generally must choose a replacement index that has historical fluctuations that are substantially similar to those of the LIBOR index and ensure that the new interest rate or APR is substantially similar. The rule provides creditors and card issuers with a non-exhaustive list of factors to consider when determining whether a replacement index meets the Regulation Z “historical fluctuations are substantially similar” standard regarding a particular LIBOR index, and identifies certain SOFR-based spread-adjusted indices recommended by the ARRC for consumer products and the Prime rate as examples of indices that meet this standard. The rule also finalizes change-in-terms notice requirements proposed by the Bureau for disclosing margin reductions for HELOCs and credit card accounts when LIBOR is replaced. To help consumers understand how creditors will determine rate changes in the variable rates for their loans, these disclosure requirements will be effective April 1, 2022, and have a mandatory compliance date of October 1, 2022. Further, the rule also amends Regulation Z to address how the requirement to reevaluate rate increases on credit card accounts applies to the transition from using a LIBOR index to a replacement index.

The Bureau is reserving judgment on the SOFR-based spread-adjusted replacement index to replace 1-year USD LIBOR until it obtains additional information. Once the Bureau knows which SOFR-based spread-adjusted index the ARRC will recommend for replacing the 1-year USD LIBOR index for consumer products, the Bureau will consider whether that index meets the comparability and “historical fluctuations are substantially similar” standards and, if so, whether to codify such determinations in a supplemental final rule.

Today’s rule follows other efforts by the Bureau to help financial markets prepare for the discontinuation of LIBOR. The CFPB is also issuing an updated set of Frequently Asked Questions (FAQs) to help creditors address other LIBOR transition topics, regulatory questions, and general implementation considerations. In 2020, the Bureau released an update to an important consumer resource on ARM loan products. The Consumer Handbook on Adjustable Rate Mortgages provides consumers information about the features and risks for those loan products. This year, the agency joined other financial, state bank, and credit union regulators to issue a statement on LIBOR discontinuation, emphasizing expectations for supervised institutions with LIBOR exposure to continue efforts in the transition to avoid undermining their financial stability, safety, and soundness.

To keep consumers informed about this important transition occurring in the financial markets, the CFPB also published a blog today with advice on navigating any issues that may arise.

Read the final rule.

Read the FAQs.

Read the blog post with consumer advice on navigating the transition away from LIBOR.

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The Consumer Financial Protection Bureau is a 21st century agency that implements and enforces Federal consumer financial law and ensures that markets for consumer financial products are fair, transparent, and competitive. For more information, visit consumerfinance.gov

CFPB ISSUES CREDIT REPORTING GUIDANCE DURING COVID-19 PANDEMIC

FOR IMMEDIATE RELEASE:
April 1, 2020

MEDIA CONTACT:
Office of Communications
Tel: (202) 435-7170

CFPB ISSUES CREDIT REPORTING GUIDANCE DURING COVID-19 PANDEMIC

WASHINGTON, D.C. — The Consumer Financial Protection Bureau (Bureau) today released a policy statement outlining the responsibility of credit reporting companies and furnishers during the COVID-19 pandemic.  In response to the pandemic, many lenders are being flexible when it comes to consumers’ making payments.  The Bureau’s statement underscores that consumers benefit if lenders report accurate information about these arrangements to credit bureaus so that the credit reports of consumers are accurate.

“During this time of uncertainty, we are providing clarity to ensure the consumer reporting industry can continue to function,” said Director Kraninger.  “Consumers rely on their credit report to purchase a new car, their new home, or to finance their college education.  An effective consumer reporting system is critical in promoting fair and efficient access to credit in the consumer financial services market.”

As lenders continue to offer struggling borrowers payment accommodations, Congress last week passed the CARES Act.  The Act requires lenders to report to credit bureaus that consumers are current on their loans if consumers have sought relief from their lenders due to the pandemic.  The Bureau’s statement informs lenders they must comply with the CARES Act.  The Bureau’s statement also encourages lenders to continue to voluntarily provide payment relief to consumers and to report accurate information to credit bureaus relating to this relief.  The continuation of reporting such accurate payment information produces substantial benefits for consumers, users of consumer reports, and the economy as a whole.

In addition, in response to staffing and resources constraints on lenders and credit bureaus due to the pandemic, the Bureau’s statement also provides flexibility for lenders and credit bureaus in the time they take to investigate disputes.   The Bureau specifically states that it does not intend to cite in an examination or bring an enforcement action against firms who exceed the deadlines to investigate such disputes as long as they make good faith efforts during the pandemic to do so as quickly as possible.

Earlier this month, the Bureau provided consumers with resources to protect their credit.  The Bureau’s blog outlines the steps consumers should take if they cannot make a payment, how to dispute inaccurate information on their credit report, and how to obtain a free copy of their credit report.  The blog can be found here.

Statement on Supervisory and Enforcement Practices Regarding the Fair Credit Reporting Act and Regulation V in Light of the CARES Act.

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The Consumer Financial Protection Bureau is a 21st century agency that helps consumer finance markets work by regularly identifying and addressing outdated, unnecessary, or unduly burdensome regulations, by making rules more effective, by consistently enforcing federal consumer financial law, and by empowering consumers to take more control over their economic lives.  For more information, visit consumerfinance.gov.

Proposed Federal Rule Could Undermine California’s Eco-Friendly Laws

Proposed Federal Laws Could Negatively Impact California’s Eco-Friendly Laws

www.AdrianasInsurance.com

On August 02, 2018, the U.S. Environmental Protection Agency (EPA) in conjunction with the U.S. Department of Transportation’s National Highway Traffic Safety Administration (NHTSA) released a notice of proposed rulemaking called the Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule for Model Years 2021-2026, Passenger Cars and Light Trucks (SAFE Vehicles Rule). This proposed rule is designed to reconfigure national automobile fuel economy and greenhouse gas emissions standards by suspending previously established anti-pollution manufacturing restrictions for automobiles. While the SAFE Vehicles Rule hasn’t yet been ratified as official policy, if approved, it would ultimately deprive individual states of the prerogative to maintain tailpipe pollution standards which are stricter than the federal government’s – a scenario that would drastically impede nationwide eco-friendly auto-manufacturing.

Opponents of the SAFE Vehicles Rule argue that it is detrimental to the cause of environmental conservation. This is because the rule essentially absolves automakers of the obligation to produce fuel-efficient cars, thereby encouraging them instead to abandon eco-friendly engineering practices. For example, previous regulations direct automakers to amplify the fuel economy of passenger vehicles to an average of 54 miles per gallon by 2025. Under the SAFE Vehicles Rule, this objective to work towards improving fuel-efficiency will no longer be prioritized. The rule will also eliminate mandatory requirements that automakers dedicate resources to develop greener vehicles such as electric cars and hybrids.

If any of the changes proposed by the SAFE Vehicles Rule sound objectionable to you, there is still an opportunity to make a difference on the final version of this proposed regulation. Full-text of the rule itself is available on the EPA’s website, and the rule has also been tabled for public comment via www.regulations.gov (Docket ID No. EPA-HQ-OAR-2018-0283). The EPA and NHTSA will hold joint public hearings on this rule in Washington D.C., Detroit, MI and Los Angeles, CA. Dates and locations for these hearings will be announced in supplemental Federal Register Documents by each of these agencies. If you care about breathing clean air and creating a safer environment for futu! re generations, take a stand and make your voice heard. We each have an important part to play when it comes to conserving our planet.