Representative Offices - Foreign (Other Nation) Banks - Financial - CA

Section § 1780

The law states that foreign banks from other countries cannot open or run an office in California for representative functions unless they have a license specifically for a representative office, agency, or branch. It means no individual can act on behalf of a foreign bank in the state without this license. However, if a person does set up such an office without a license, it's considered as if the bank itself did it. The rule doesn't stop foreign banks with federally regulated branches or agencies in California from having additional representative offices in the state.

(a) No foreign (other nation) bank shall establish or maintain an office in this state at which it engages in representational functions unless it is licensed to maintain a representative office, agency, or branch office at that place.

(b)

(1) No person shall establish or maintain an office in this state as representative of a foreign (other nation) bank unless the bank is licensed to maintain the office as a representative office.

(2) For purposes of this chapter, if any person establishes or maintains an office in this state as representative of a foreign (other nation) bank, the bank shall be deemed to establish and maintain the office as a representative office.

(c) Neither subdivision (a) nor subdivision (b) shall be deemed to prohibit a foreign (other nation) bank that maintains a federal agency or federal branch in this state from establishing or maintaining one or more representative offices in this state.

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Section § 1781

This law section outlines the rules for foreign banks that want to set up a representative office in California. Before a foreign bank can open such an office, they must get approval and a license from the commissioner. If the foreign bank already has a federal branch or agency in the state, they can open more representative offices without additional approval.

The commissioner will approve their application if they meet several criteria: the bank's management and financial conditions must be sound, and they must follow legal regulations. If they don't meet these requirements, the application will be denied.

Once the application is approved and all requirements are met, the commissioner will issue the license to operate the representative office.

(a)

(1) No foreign (other nation) bank shall establish or maintain a representative office unless the commissioner shall have first approved the establishment of the office and issued a license authorizing the bank to maintain the office.

(2) Paragraph (1) shall not be deemed to prohibit a foreign (other nation) bank that maintains a federal agency or federal branch in this state from establishing or maintaining one or more representative offices in this state.

(b) If the commissioner finds the following with respect to an application by a foreign (other nation) bank for approval to establish a representative office, the commissioner shall approve the application:

(1) That the bank, any controlling person of the bank, the directors and executive officers of the bank or of any controlling person of the bank, and the proposed management of the office are each of good character and sound financial standing.

(2) That the financial history and condition of the bank are satisfactory.

(3) That the management of the bank and the proposed management of the office are adequate.

(4) That it is reasonable to believe that, if licensed to maintain the office, the bank will operate the office in compliance with all applicable laws, regulations, and orders.

If the commissioner finds otherwise, the commissioner shall deny the application.

(c) Whenever an application by a foreign (other nation) bank for approval to establish a representative office has been approved and all conditions precedent to the issuance of a license authorizing the bank to maintain the office have been fulfilled, the commissioner shall issue the license.

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Section § 1782

A foreign bank with a representative office in California cannot move that office to a new location without first getting approval from the state commissioner. If the new site is close to the old one and doesn't harm public convenience, or if it's farther but benefits the public, the commissioner will approve the move. Otherwise, the application will be denied.

Once approved, the bank gets a new license for the new location. After relocating, the bank must return its old site license to the commissioner.

(a) No foreign (other nation) bank that is licensed to maintain a representative office shall relocate the office unless the commissioner shall have first approved the relocation and issued a license authorizing the bank to maintain the office at the new site.

(b) If the commissioner finds the following with respect to an application by a foreign (other nation) bank for approval to relocate a representative office, the commissioner shall approve the application:

(1) In case the new site of the office is in the same vicinity as the old site, that the relocation of the office will not be substantially detrimental to the public convenience and advantage; or

(2) In case the new site of the office is not in the same vicinity as the old site:

(A) That the relocation of the office from the old site will not be substantially detrimental to the public convenience and advantage in the area that is primarily served by the office at the old site; and

(B) That the relocation of the office to the new site will promote the public convenience and advantage.

If the commissioner finds otherwise, the commissioner shall deny the application.

(c) Whenever an application by a foreign (other nation) bank for approval to relocate a representative office has been approved and all conditions precedent to the issuance of a license authorizing the bank to maintain the office at the new site have been fulfilled, the commissioner shall issue the license.

(d) Promptly after a foreign (other nation) bank that is licensed to maintain a representative office relocates the office, the bank shall surrender to the commissioner the license that authorized it to maintain the office at the old site.

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Section § 1783

Foreign banks, which come from other countries and have a license to set up a representative office in California, can perform certain representational activities. However, they cannot accept deposits or conduct any other business transactions at this office, unless regulations state otherwise.

A foreign (other nation) bank that is licensed to maintain a representative office may, subject to any regulations that the commissioner may prescribe, engage in representational functions at the office but shall not solicit or accept deposits or otherwise transact business at the office.

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Section § 1784

If a foreign bank with a license to have a representative office in California wants to close that office, they must first get approval from the commissioner. However, if the closure is done according to specific rules starting at Section 1825, then it is allowed without prior approval.

The commissioner will approve the closure if it doesn't harm public convenience or advantage. If it does, the closure will be denied. Once approval is granted and all conditions are met, the bank must close the office and return the license to the commissioner.

(a)

(1) No foreign (other nation) bank that is licensed to maintain a representative office shall close the office unless the commissioner shall have first approved the closing.

(2) Paragraph (1) shall not be deemed to prohibit a foreign (other nation) bank that is licensed to maintain a representative office from closing the office in accordance with Article 4 (commencing with Section 1825).

(b) If the commissioner finds, with respect to an application by a foreign (other nation) bank for approval to close a representative office, that the closing of the office will not be substantially detrimental to the public convenience and advantage, the commissioner shall approve the application. If the commissioner finds otherwise, the commissioner shall deny the application.

(c) Whenever an application by a foreign (other nation) bank for approval to close a representative office has been approved and all conditions precedent to the closing have been fulfilled, the bank may close the office and shall promptly thereafter surrender to the commissioner the license that authorized it to maintain the office.

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