This chapter may be cited as the “Foreign (Other Nation) Credit Union Law.”
Foreign (other Nation) Credit UnionsGeneral Provisions
Section § 16500
This law is officially named the “Foreign (Other Nation) Credit Union Law.” It sets regulations for credit unions from other countries that operate in California.
Foreign Credit Union Other Nation Credit Union credit union regulations
Section § 16501
This section defines key terms related to foreign credit unions operating in California. It explains what is meant by an 'agency', 'branch business', and 'branch office' for these institutions. It also clarifies the term 'business in this state' as covering all activities by these credit unions in California. The section defines a 'foreign nation' and distinguishes between foreign credit unions from other countries and those from other U.S. states. 'Home country' and 'home country regulator' refer to the nation and authority governing the foreign credit union, respectively. 'License' pertains to permission for these credit unions to operate in California. 'Office' includes various types of operations like branch or representative offices that these credit unions might maintain in the state. Lastly, it defines what constitutes a 'representative office', focusing on non-business activities.
In this chapter:
(a)CA Financial Code § 16501(a) “Agency,” when used with respect to a foreign (other nation) credit union, means an office in this state at which the foreign (other nation) credit union transacts credit union business, other than branch business.
(b)CA Financial Code § 16501(b) “Branch business” means the business of issuing shares or certificates, receiving deposits, paying checks, making loans, and other activities that the commissioner may specify by order or
regulation.
(c)CA Financial Code § 16501(c) “Branch office,” when used with respect to a foreign (other nation) credit union, means an office in this state at which the foreign (other nation) credit union engages in branch business.
(d)CA Financial Code § 16501(d) “Business in this state,” when used with respect to a foreign (other nation) credit union that is licensed to maintain one or more offices, includes the aggregate business of all of the offices.
(e)CA Financial Code § 16501(e) “Foreign nation” means any nation other than the United States, including, without limitation, any subdivision, territory, trust territory, dependency, colony, or possession of any nation other than the United States.
(f)CA Financial Code § 16501(f) “Foreign (other nation) credit union” means any credit union or similar institution that is organized under the laws of a foreign
nation.
(g)CA Financial Code § 16501(g) “Foreign (other state) state credit union” means a credit union that is organized under the laws of a state of the United States other than California.
(h)CA Financial Code § 16501(h) “Home country,” when used with respect to a foreign (other nation) credit union, means the foreign nation under whose laws the foreign (other nation) credit union is organized.
(i)CA Financial Code § 16501(i) “Home country regulator,” when used with respect to a foreign (other nation) credit union, means the regulatory agency in the home country of the foreign (other nation) credit union that has primary regulatory authority over the foreign (other nation) credit union.
(j)Copy CA Financial Code § 16501(j)
(1)Copy CA Financial Code § 16501(j)(1) “License” means a license issued under this chapter, authorizing a foreign (other nation) credit union to maintain an
office.
(2)CA Financial Code § 16501(j)(2) To be “licensed” means to be issued or to hold a license.
(3)CA Financial Code § 16501(j)(3) To be “licensed to transact business in this state,” when used with respect to a foreign (other nation) credit union, means that the foreign (other nation) credit union is licensed to maintain an agency or branch office.
(k)CA Financial Code § 16501(k) “Office,” when used with respect to a foreign (other nation) credit union, means a branch office, an agency, or a representative office maintained by the foreign (other nation) credit union.
(l)CA Financial Code § 16501(l) “Representative office,” when used with respect to a foreign (other nation) credit union, means an office in this state at which the foreign (other nation) credit union engages in representational functions but at which it does not transact business.
(m)CA Financial Code § 16501(m) “State of the United States” means any state of the United States, the District of Columbia, any territory of the United States, Puerto Rico, Guam, American Samoa, the Trust Territory of the Pacific Islands, the Virgin Islands, and the Northern Mariana Islands.
foreign credit union agency branch business
Section § 16502
This law section clarifies that the rules in this chapter do not apply to credit unions from other states. It also states that these out-of-state credit unions are not allowed to conduct business within the state.
Nothing in this chapter shall apply to a foreign (other state) state credit union or be deemed to authorize a foreign (other state) state credit union to transact business in this state.
foreign state credit union out-of-state credit unions business transaction prohibition
Section § 16503
If a credit union from another country wants to open a branch office, its accounts must be insured by either the National Credit Union Administration or another insurer that the commissioner approves.
No foreign (other nation) credit union may establish a branch office unless its deposit or share accounts are insured by the National Credit Union Administration or other insurer that is not unsatisfactory to the commissioner.
foreign credit union branch office deposit insurance
Section § 16504
When you apply to the commissioner under this chapter, you must follow specific rules about how the application is written, what information it includes, and how it is signed. If the commissioner decides, you also might need to verify the application in a certain way, according to their regulations or orders.
Each application filed with the commissioner under this chapter or under any regulation or order issued under this chapter shall be in the form, shall contain the information, shall be signed in the manner, and shall (if the commissioner requires by regulation or order) be verified in the manner that the commissioner may by regulation or order require.
application requirements commissioner's regulations form and information
Section § 16505
This section outlines various fees that foreign credit unions, which are credit unions from other countries, must pay to the commissioner in California for different actions such as setting up branch offices, agencies, and representative offices. The fees vary depending on whether the credit union is already licensed in California. For instance, it costs $1,000 to apply for a branch if unlicensed, and $500 if licensed, among other specific fees for agencies and representative offices. Additionally, there are annual fees based on the number of offices maintained. If an examination is needed for applications or ongoing activities, the credit union must pay for the costs, including any necessary travel expenses for examiners.
Fees shall be paid to and collected by the commissioner as follows:
(a)CA Financial Code § 16505(a) The fee for filing with the commissioner an application by a foreign (other nation) credit union that is not licensed to transact business in this state for approval to establish a branch office shall be one thousand dollars ($1,000).
(b)CA Financial Code § 16505(b) The fee for filing with the commissioner an application by a foreign (other nation) credit union that is not licensed to transact business in this state for approval to establish an agency shall be five hundred dollars ($500).
(c)CA Financial Code § 16505(c) The fee for filing with the commissioner an application by a foreign (other nation) credit union that is licensed to
transact business in this state for approval to establish a branch office shall be five hundred dollars ($500).
(d)CA Financial Code § 16505(d) The fee for filing with the commissioner an application by a foreign (other nation) credit union that is licensed to transact business in this state for approval to establish an agency shall be two hundred fifty dollars ($250).
(e)CA Financial Code § 16505(e) The fee for filing with the commissioner an application by a foreign (other nation) credit union for approval to establish a representative office shall be two hundred fifty dollars ($250).
(f)CA Financial Code § 16505(f) The fee for filing with the commissioner an application by a foreign (other nation) credit union for approval to relocate or to close an office shall be one hundred fifty dollars ($150).
(g)CA Financial Code § 16505(g) The fee for issuing a license
shall be twenty-five dollars ($25).
(h)CA Financial Code § 16505(h) Each foreign (other nation) credit union that on June 1 of any year maintains one or more offices shall pay, on or before the following July 1, a fee of two hundred fifty dollars ($250) per branch office, one hundred dollars ($100) per agency, and fifty dollars ($50) per representative office.
(i)CA Financial Code § 16505(i) If the commissioner makes an examination in connection with a pending application, the foreign (other nation) credit union making the application shall pay a fee for the examination, as determined by the commissioner. In determining the fee, the commissioner may use the estimated average hourly cost, including, but not limited to, overhead, for all persons performing the examination, plus, if in the opinion of the commissioner it is necessary for any examiner engaged in the examination to travel outside this state, the travel expenses of the examiner.
(j)CA Financial Code § 16505(j) If the commissioner makes an examination of a foreign (other nation) credit union that is licensed to maintain an office, the foreign (other nation) credit union shall pay a fee for the examination, as determined by the commissioner. In determining the fee, the commissioner may use the estimated average hourly cost, including, but not limited to, overhead, for all persons performing the examination, plus, if in the opinion of the commissioner it is necessary for any examiner engaged in the examination to travel outside this state, the travel expenses of the examiner.
foreign credit union fees branch office application fee agency application fee
Section § 16506
If a foreign credit union wants to operate an office in California, it must first formally appoint the state financial commissioner to receive any legal paperwork in non-criminal proceedings related to its activities in California, as if they were served in person. If the credit union doesn't file this appointment, just having an office in the state automatically means it agrees to this setup.
To serve legal papers to such a credit union, you can leave them at any commissioner’s office. However, service isn't complete until the serving party also mails a copy to the credit union's last known address and files proof in court or with an agency.
(a)Copy CA Financial Code § 16506(a)
(1)Copy CA Financial Code § 16506(a)(1) No foreign (other nation) credit union shall be issued a license to maintain an office unless it shall have first filed with the commissioner, in the form that the commissioner may by regulation or order require, an appointment irrevocably appointing the commissioner and the commissioner’s successor from time to time in office to be the foreign (other nation) credit union’s attorney to receive service of any lawful process in any noncriminal judicial or administrative proceeding against the foreign (other
nation) credit union or any of its successors that arises out of the activities in this state after the appointment has been filed, with the same force and validity as if served personally on the foreign (other nation) credit union or its successor, as the case may be.
(2)CA Financial Code § 16506(a)(2) Any foreign (other nation) credit union that maintains an office in this state and that has not filed with the commissioner an appointment pursuant to paragraph (1) shall be deemed by the maintenance of that office to have appointed the commissioner as its attorney to receive service of any lawful process in any noncriminal judicial or administrative proceeding against the foreign (other nation) credit union or any of its successors that arises out of the activities in this state with the same force and validity as if served personally on the foreign (other nation) credit union or its successor, as the case may be.
(b)CA Financial Code § 16506(b) Service may be made on a foreign (other nation) credit union that has appointed or is deemed to have appointed the commissioner as its attorney for service of process by leaving a copy of the process at any office of the commissioner. However, the service is not effective unless (1) the party making the service, who may be the commissioner, forthwith sends notice of the service and a copy of the process by registered or certified mail to the foreign (other nation) credit union served at its last address on file with the commissioner at any of its offices in this state or at its head office, and (2) an affidavit of compliance with this subdivision by the party making service is filed in the case on or before the return date, if any, or within any further time that the court, in the case of a judicial proceeding, or the administrative agency, in the case of an administrative proceeding, allows.
foreign credit union license requirement commissioner appointment
Section § 16507
This law allows the commissioner to share information with federal authorities and regulators from other countries about foreign credit unions.
In administering the provisions of this chapter, the commissioner may share information with federal and home country regulators of foreign (other nation) credit unions.
commissioner information sharing federal regulators
Section § 16508
This law states that a license cannot be transferred or assigned to another person or entity.
No license shall be transferable or assignable.
license transfer prohibition non-transferable license license assignment
Section § 16509
A credit union from a foreign country that is allowed to have an office in California must display a clear notice at its office. This notice needs to include the credit union's name, the type of office it is, and the country where it was legally established.
A foreign (other nation) credit union that is licensed to establish an office shall post at a conspicuous place at the office a notice to the public which states the name of the foreign (other nation) credit union, the type of office it is, and the foreign country under whose laws it was organized or chartered.
foreign credit union office licensing public notice requirements
Section § 16510
If a credit union from another country is allowed to set up multiple offices in California, it must choose one office to be its main or primary office.
Whenever a foreign (other nation) credit union is licensed to establish more than one office, it shall designate one of its offices as its primary office.
foreign credit union multiple offices license
Section § 16511
This law states that a foreign credit union licensed to operate in California must conduct all its business in one building or in buildings that are next to each other. However, if they get approval from the commissioner, they may be allowed to run part of their business in a nearby location.
Each foreign (other nation) credit union that is licensed to establish an office shall conduct all of the business of the office in a single building or in adjoining buildings. However, with the approval of the commissioner, the foreign (other nation) credit union may conduct part of the business of the office elsewhere in the same vicinity.
foreign credit union office licensing business location
Section § 16512
If there's a conflict between the rules in this chapter and other parts of the law regarding a foreign (from another country) credit union with a branch or office, the rules in this chapter take precedence.
Whenever any provision of this chapter or of any regulation or order issued under this chapter that is applicable to or with respect to a foreign (other nation) credit union that maintains a branch office or facility is inconsistent with any provision of any other chapter of this division, the former provision applies, and the latter provision does not apply.
foreign credit union branch office facility
