Aligning Sec Regulations for the World Bank's International Development Association Act
Floor Speech
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Mr. HILL of Arkansas. Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 1764) to accord securities issued by the International Development Association the same exemption from the securities laws that applies to the securities of other multilateral development banks in which the United States is a member, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows: H.R. 1764
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE.
This Act may be cited as the ``Aligning SEC Regulations for the World Bank's International Development Association Act''. SEC. 2. EXEMPTION OF SECURITIES OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION FROM THE SECURITIES LAWS.
(a) In General.--The International Development Association Act (22 U.S.C. 284 et seq.) is amended by adding at the end the following: ``SEC. 33. EXEMPTION OF SECURITIES OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION FROM THE SECURITIES LAWS.
``(a) Exemption From Securities Laws; Reports to Securities and Exchange Commission.--Any securities issued by the Association (including any guaranty by the Association, whether or not limited in scope) and any securities guaranteed by the Association as to both principal and interest shall be deemed to be exempted securities within the meaning of section 3(a)(2) of the Securities Act of 1933 (15 U.S.C. 77c(a)(2)) and section 3(a)(12) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(12)). The Association shall file with the Securities and Exchange Commission such annual and other reports with regard to such securities as the Commission shall determine to be appropriate in view of the special character of the Association and its operations and necessary in the public interest or for the protection of investors.
``(b) Authority of Securities and Exchange Commission to Suspend Exemption; Reports to Congress.--The Securities and Exchange Commission, acting in consultation with the National Advisory Council on International Monetary and Financial Problems, is authorized to suspend the provisions of subsection (a) of this section at any time as to any or all securities issued or guaranteed by the Association during the period of such suspension. The Commission shall include in its annual reports to the Congress such information as it shall deem advisable with regard to the operations and effect of this section.''.
(b) Effective Date.--
(1) In general.--The amendment made by subsection (a) shall take effect 30 days after the date of enactment of this Act.
(2) Exception.--Notwithstanding paragraph (1), the amendment made by subsection (a) shall not take effect if, before the effective date described under paragraph (1), the Secretary of the Treasury reports to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate that the International Development Association is providing financial assistance to any country the government of which the Secretary of State has determined, for purposes of section 6(j) of the Export Administration Act of 1979, section 620A of the Foreign Assistance Act of 1961, or section 40 of the Arms Export Control Act, to be a government that has repeatedly provided support for acts of international terrorism.
Mr. Speaker, I rise in strong support of H.R. 1764, the Aligning SEC Regulations for the World Bank's International Development Association Act, the bill offered by the gentlewoman from California (Ms. Waters).
Mr. Speaker, this legislation classifies securities issued by the IDA as exempted securities, subject to appropriate reporting requirements as determined by the Securities and Exchange Commission.
This change would place the IDA on equal regulatory footing with the other World Bank divisions such as the Inter-American Development Bank, the Asian Development Bank, the European Bank for Reconstruction and Development, and the African Development Bank.
Prior to 2018, the IDA did not issue debt in the securities markets. Its funding came primarily from donor contributions and repayments on past loans.
As the IDA evolves to meet the needs of the world's poorest nations, it has entered the capital markets to expand its resources and its impact.
It is only logical and fair that its securities receive the same exempted status consistent with previous treatment of multilateral development bank securities.
Supporting IDA's access to efficient financing would reflect the United States' leadership in global development and our commitment to the world's most vulnerable populations.
Ms. Waters' bill is bipartisan. It is practical. It is overdue. I urge all of my colleagues to join me in supporting this bill.
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Mr. HILL of Arkansas. Mr. Speaker, I include in the Record the CBO estimate on this bill. H.R. 1764, ALIGNING SEC REGULATIONS FOR THE WORLD BANK'S INTERNATIONAL DEVELOPMENT ASSOCIATION ACT, AS REPORTED BY THE HOUSE COMMITTEE ON FINANCIAL SERVICES ON MARCH 21, 2025 ------------------------------------------------------------------------ By fiscal year, millions of dollars-- ------------------------------- 2025 2025-2030 2025-2035 ------------------------------------------------------------------------ Direct Spending (Outlays)............... 0 0 0 Revenues................................ 0 0 0 Increase or Decrease (-) in the Deficit. 0 0 0 Spending Subject to Appropriation * * ** (Outlays).............................. ------------------------------------------------------------------------ * = between zero and $500,000. ** = not estimated.
Increases net direct spending in any of the four consecutive 10-year periods beginning in 2036? No.
Increases on-budget deficits in any of the four consecutive 10-year periods beginning in 2036? No.
Statutory pay-as-you-go procedures apply? No.
Mandate Effects:
Contains intergovernmental mandate? No.
Contains private-sector mandate? Yes, Under threshold.
H.R. 1764 would exempt the International Development Association at the World Bank from the requirement to register securities that it issues or guarantees with the Securities and Exchange Commission (SEC). The exemption would not take effect if the Department of the Treasury determines that the association has provided financial assistance to any country identified by the Department of State as supporting terrorism. The SEC could require the association to file additional reports and, in consultation with the National Advisory Council on International Monetary and Financial Problems, suspend the exemption at any time.
Using information about the cost of similar provisions, CBO estimates that it would cost the SEC less than $500,000 to update rules and process any additional disclosures by the Association. Moreover, because the SEC is authorized to collect fees each year to offset its annual appropriation, CBO expects that the net effect on discretionary spending over the 2025-2030 period would be negligible, assuming appropriation actions consistent with that authority.
If the SEC increases fees to offset the costs associated with implementing the bill, H.R. 1764 would increase the cost of an existing mandate on private entities required to pay those assessments. CBO estimates that the incremental cost of the mandate would be small and would fall well below the annual threshold for private-sector mandates established in the Unfunded Mandates Reform Act (UMRA) ($198 million in 2023, adjusted annually for inflation).
H.R. 1764 contains no intergovernmental mandates as defined in UMRA.
The CBO staff contacts for this estimate are Aurora Swanson (for federal costs) and Rachel Austin (for mandates). The estimate was reviewed by H. Samuel Papenfuss, Deputy Director of Budget Analysis. Phillip L. Swagel, Director, Congressional Budget Office.
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Mr. HILL of Arkansas. Mr. Speaker, I urge a ``yes'' vote on this very practical bill, and I yield back the balance of my time.
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