This chapter may be cited as the “Foreign (Other State) Credit Union Law.”
Foreign (other State) Credit UnionsGeneral Provisions
Section § 16000
This law is known as the 'Foreign (Other State) Credit Union Law,' which suggests that it governs credit unions from other states operating within California.
credit union foreign credit union other state credit union
Section § 16001
This section defines specific terms related to foreign and domestic credit unions operating in California. It clarifies what constitutes 'branch business' activities, which are core financial services like issuing loans and receiving deposits. A 'California branch office' is where a foreign state credit union performs branch business in California. A 'California facility' is where a foreign credit union conducts non-branch business, excluding basic informational services offered by volunteers. It also differentiates between credit unions from other countries (foreign nations) and those from other U.S. states (foreign states), along with their respective home state regulators.
In this chapter:
(a)CA Financial Code § 16001(a) “Branch business” means the business of issuing share accounts, certificates for funds, and share drafts, receiving deposits, paying checks, making loans and other obligations, and other activities that the commissioner may specify by order or regulation.
(b)CA Financial Code § 16001(b) “California branch office,” when used with respect to a foreign (other state) credit union, means an office in this state at which the foreign (other state)
credit union engages in branch business.
(c)Copy CA Financial Code § 16001(c)
(1)Copy CA Financial Code § 16001(c)(1) “California facility,” when used with respect to a foreign (other state) credit union, means an office in this state at which the foreign (other state) credit union engages in business other than branch business.
(2)CA Financial Code § 16001(c)(2) In the case of an employer-supported foreign (other state) credit union, a “California facility” does not include a table, counter, or booth on the premises of the employer’s place of business at which a volunteer of the foreign (other state) credit union provides information or services to members but does not engage in branch business.
(d)CA Financial Code § 16001(d) “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.
(e)CA Financial Code § 16001(e) “Foreign (other nation) credit union” means any credit union or similar institution that is organized under the laws of a foreign nation.
(f)CA Financial Code § 16001(f) “Foreign (other state) credit union” means a credit union that is organized under the laws of any state of the United States other than this state.
(g)CA Financial Code § 16001(g) “Home state,” when used with respect to a foreign (other state) credit union, means the state of the United States under which the foreign (other state) credit union is organized.
(h)CA Financial Code § 16001(h) “Home state regulator,” when used with respect to a foreign (other state) credit union, means the state regulatory agency in the home state of the foreign (other state) credit union which has primary regulatory authority over the foreign (other state)
credit union.
(i)CA Financial Code § 16001(i) “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.
branch business California branch office foreign credit union
Section § 16002
This law makes it clear that foreign credit unions from outside the U.S. are not allowed to conduct business in California.
Nothing in this chapter shall be deemed to authorize a foreign (other nation) credit union to transact business in this state.
foreign credit union transact business prohibited activities
Section § 16003
This law states that a credit union from another state cannot open or operate a branch or facility in California unless they're properly registered to conduct business within the state. They must comply with specific registration requirements under the Corporations Code, with certain exceptions noted in Section 8910.
No foreign (other state) credit union may establish or maintain a California branch office or California facility unless it is qualified to transact intrastate business under Chapter 21 (commencing with Section 2100) of Division 1 of Title 1 of the Corporations Code, except as provided in Section 8910 of the Corporations Code.
foreign credit unions California branch office intrastate business
Section § 16004
If a credit union from another state wants to open a branch or facility in California, its deposit accounts must be insured by the National Credit Union Administration or another approved insurer.
No foreign (other state) credit union may establish a California branch office or California facility 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 California branch California facility
Section § 16005
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 § 16006
This law outlines the fees that foreign credit unions must pay to the commissioner for establishing and maintaining branch offices in California. If a credit union from another state wants to open a branch in California and isn't licensed in the state, the application fee is $1,000. If they are licensed, the application fee is $500. The license cost to operate a branch or facility is $25.
Every year, credit unions with branches or facilities in California pay an annual fee on June 1, which is $250 per branch and $100 per facility, with a cap of $1,000 total. Additionally, if the commissioner needs to examine a credit union as part of an application or routine check, the credit union must cover the examiner's costs, which may include travel.
Fees shall be paid to and collected by the commissioner as follows:
(a)CA Financial Code § 16006(a) The fee for an application by a foreign (other state) credit union that is not licensed to transact business in this state for approval to establish a branch office is one thousand dollars ($1,000).
(b)CA Financial Code § 16006(b) The fee for an application by a foreign (other state) credit union that is licensed to transact business in this state for approval to establish a California branch office is five hundred dollars ($500).
(c)CA Financial Code § 16006(c) The fee for issuing a license to establish and maintain a California branch office or California facility is twenty-five dollars ($25).
(d)CA Financial Code § 16006(d) Each foreign (other state) credit union that on June 1 of any year maintains one or more California branch offices or California facilities shall pay, on or before the following July 1, a fee of two hundred fifty dollars ($250) per California branch office and one hundred dollars ($100) per California facility. However, the maximum fee shall be not more than one thousand dollars ($1,000).
(e)CA Financial Code § 16006(e) If the commissioner makes an examination in connection with a pending application, the foreign (other state) 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.
(f)CA Financial Code § 16006(f) If the commissioner makes an examination of a foreign (other state) credit union that maintains a California branch office or California facility, the foreign (other state) 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 application fee branch office approval
Section § 16007
Before a credit union from another state opens a branch or facility in California, they must designate the California commissioner as their legal representative for receiving any legal documents. This appointment must be made at least 30 days in advance. If a credit union does not make this appointment, merely having a branch in California means the commissioner is automatically considered their representative for legal documents.
If the commissioner is appointed, legal documents can be delivered at any of their offices, but the sender must also mail a copy of these documents to the credit union's last known address and submit a proof of compliance. This ensures the credit union is notified and can participate in any legal actions.
(a)CA Financial Code § 16007(a) Not less than 30 days before a foreign (other state) credit union establishes a California branch office or a California facility, the foreign (other state) credit union shall file 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 state) credit union’s attorney to receive service of any lawful process in any noncriminal judicial or administrative proceeding
against the foreign (other state) credit union or any of its successors that arises out of the activities of the California branch office or California facility after the appointment has been filed, with the same force and validity as if served personally on the foreign (other state) credit union or its successors, as the case may be.
(b)CA Financial Code § 16007(b) Any foreign (other state) credit union that maintains a California branch office or California facility that has not filed with the commissioner an appointment pursuant to subdivision (a) is deemed by the maintenance of the branch office or facility 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 state) credit union or any of its successors that arises out of the activities of the California branch office or California facility, with the same force and validity as if served personally
on the credit union or its successor, as the case may be.
(c)CA Financial Code § 16007(c) Service may be made on a foreign (other state) 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 state) credit union served at the last address on file with the commissioner for any of the foreign (other state) credit union’s offices in this state or at its head office, and (2) an affidavit of compliance with this subdivision by the party making the 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 California branch office appointment of commissioner
Section § 16008
This law allows the commissioner to share information with federal regulators and regulators from other states about foreign credit unions, which are credit unions based in states other than California.
In administering the provisions of this chapter, the commissioner may share information with federal and home state regulators of foreign (other state) credit unions.
commissioner information sharing foreign credit unions
Section § 16009
If a credit union from another state is licensed to set up an office in California, it must put up a clear notice at that office. The notice should include the credit union's name, the type of office, and the state where it was originally formed or chartered.
A foreign (other state) 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 state) credit union, the type of office it is, and the state of the United States under whose laws it was organized or chartered.
foreign credit union office license notice requirement
Section § 16010
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 § 16011
If a credit union from another state is allowed to have more than one branch in California, it needs to choose one of these branches to be its main office.
Whenever a foreign (other state) credit union is licensed to establish more than one office, it shall designate one of its offices as its primary office.
foreign credit union license multiple offices
Section § 16012
This law states that a credit union from another state, which has a license to set up an office, must generally do all its business in one building or in buildings that are next to each other. However, if they notify the commissioner beforehand, they are allowed to conduct some of their business in other nearby locations.
Each foreign (other state) 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 prior to notice to the commissioner, the foreign (other state) credit union may conduct part of the business of the office elsewhere in the same vicinity.
foreign credit union office licensing business location
Section § 16013
This law states that if there's a conflict between this specific set of rules and any other rules for foreign credit unions operating in California, the rules from the other chapter will take priority over this chapter.
Whenever any provision of this chapter or of any regulation or order issued under this chapter which is applicable to or with respect to a foreign (other state) credit union that maintains a California branch office or California facility is inconsistent with any provision of any other chapter of this division, the provision of the other chapter applies, and the latter provision does not apply.
foreign credit union California branch office regulation inconsistency
