Summary of Amendments Submitted to the Rules Committee on
H.R. 975 - Bankruptcy Abuse Prevention and Consumer Protection Act of 2003
(in alphabetical order)
March 18, 2003 (1:45 p.m.)
Cannon/Delahunt #7
(1) Increases the monetary cap on wage and employee benefit claims entitled to priority under the Bankruptcy Code from $4,650 to $10,000 and lengthens the reachback period for wage claims form 90 days to 180 days;(2) increases the reachback period during which fraudulent transfers can be rescinded from one to two years and provides that certain compensation payments (e.g. bonuses) to a corporation’s insiders during this two-year reachback period can be rescinded, under certain circumstances; and (3) requires the court to reinstate retiree benefits that a corporate debtor modified within the 180-day period preceding the bankruptcy filing, unless the balance of the equities justifies the modification.
Conyers #13 Amendment in the Nature of a Substitute.
Modifies the means test and requires the court, in considering a motion to dismiss or convert a ch. 7 case, to take into account the debtor’s actual reasonable and necessary expenses and income, and determine whether the debtor can repay 30% of unsecured debt. Protects child and spousal support obligations by limiting the ability of creditors to deprive debtors of the right to a fresh start and emerge from bankruptcy able to pay their obligations to their children. Modifies changes to ch. 13 to make it more workable and increase the likelihood that debtors who choose ch. 13 will succeed. Makes restrictions on automobile cram-down more workable (1-year instead of 2-year lookback) and other personalty (6-month instead of 1-year lookback). Prevents debtors from using bankruptcy court to evade lawful debts for certain criminal civil rights violations. Provides enhanced protection for employee benefits, ensures fairness for employees, and provides a remedy for corporate wrongdoing in ch. 11. Provides bankruptcy courts with flexibility to protect small businesses from premature or unnecessary liquidation if they are able to reorganize successfully. Closes loophole in current law by preventing debtors from taking cases to courts far away from where the business is actually conducted. Protects the right of debtors to uphold contracts in bankruptcy. Provides for additional bankruptcy judges according to the most recent needs assessment by the Judicial Conference. Strikes pro-IRS amendments that would elevate the rights of taxing authorities over other creditors and debtors. Provides for enhanced disclosure on credit card statements to help consumers understand the cost to repay balances using their actual debts. Protects against corruption in bankruptcy proceedings by deleting amendments that would allow for abusive motions, allow for conflicts of interest on the part of investment bankers, and allow bankruptcy professionals to evade accountability in court for their wrongdoing. LATE
Conyers/Slaughter/Jackson Lee #11
Allows the court to waive provisions of new cram down, luxury, ATM , and credit cards used to pay taxes, in any case in which the court determines it would impair the debtors ability to pay domestic support obligations.
Delahunt #5
Places a $125,000 national cap on the homestead exemption while eliminating the exemptions for transactions conducted more than 1215 days preceding the bankruptcy filing and for interests transferred from a debtor’s previous principal residence within the same state prior to that time.
Delahunt #6
Places limits on “retention bonuses”, severance packages, and other payments to employees of companies that are bankrupt or facing bankruptcy. Permits such payments only when the court finds that the employee has a bona fide job offer from another business at the same or greater rate of compensation.
Guiterrez #12
Provides that upon enactment, Section 1234 applies both prospectively and to involuntary cases now pending in the bankruptcy courts. LATE
Jackson Lee #8
Places restrictions on the predatory lending practice known as “payday lending”. Would stop abusive practices by such lenders.
Waters # 9
Adds consumer protections to title XIII of the bill that would prohibit the issuance of credit cards to persons under age 21 unless a parent acts as co-signer or minors can demonstrate an independent source of income sufficient to repay debts.
Schakowsky #10
Exempts from the means test any debtor, if the debtor or the debtor’s spouse is: (1) an active duty member of the United States Armed Forces, (2) is unemployed and has exhausted unemployment benefits, or is a victim of international terrorism.
Sherman #1
Strikes Section 417 of the bill relating to Utility Services. WITHDRAWN
Sherman #2
Amend section 546(e) by stating that it is not applicable to any payment made to shareholders as part of leveraged buy-out. WITHDRAWN
Sherman #3
Correct a drafting error in Section 356 and clarify that a debtor in possession may assume, but may not assign, an executory contract or unexpired lease in certain circumstances. WITHDRAWN
Sherman #4
Requires corporations filing for bankruptcy to file their case in the district court of the district in which the corporation’s principal place of business in the United States is located. For cases in which the debtor is an affiliate, the bankruptcy case may be filed in the district in which the principal place of business of the affiliate with the greatest assets in the Untied States is located.
Toomey/Sherman#14
Redrafts Title IX so that the same provisions in Title IX are applicable to both the bank and credit union federal regulators that must manage these matters should a problem occur. LATE
* Summaries derived from information submitted by the amendment sponsors.
