(July 31 – 17:30 ET) – Financial firms will be free to become e-commerce powerhouses under proposed new U.S. banking legislation.
The Federal Reserve Board is requesting public comment on a proposed rule that would allow financial holding companies to act as a “finder”. They would do this by bringing together buyers and sellers of financial and non-financial products for transactions that the buyers and sellers themselves negotiate and consummate. The proposed rule, which was developed in consultation with the Secretary of the Treasury, would allow financial holding companies to, among other things, host an Internet marketplace consisting of links to the Web sites of third-party buyers and sellers.
It also would permit financial holding companies to operate a Web site that allows buyers and sellers to post information concerning the products and services they are willing to buy and sell and to enter into transactions among themselves.
Prior to the Gramm-Leach-Billey Act, signed last year, financial institutions were strictly barred from engaging in non-banking commerce in the U.S. The new rules would only apply to foreign banks and non-bank holding companies that qualify as financial holding companies under U.S. law. Those that don’t qualify will continue to be restricted as they were before GLB. Comment is requested by September 5.
-IE Staff