15 U.S.C. § 661 — Congressional declaration of policy

Page 1082 TITLE 15—COMMERCE AND TRADE § 661 Sec. 689k. Examinations. 689l. Injunctions and other orders. 689m. Additional penalties for noncompliance. 689n. Unlawful acts and omissions; breach of fidu- ciary duty. 689o. Removal or suspension of directors or offi- cers. 689p. Regulations. 689q. Authorization of appropriations. PART C—RENEWABLE FUEL CAPITAL INVESTMENT PILOT PROGRAM 690. Definitions. 690a. Purposes. 690b. Establishment. 690c. Selection of Renewable Fuel Capital Invest- ment companies. 690d. Debentures. 690e. Issuance and guarantee of trust certificates. 690f. Fees. 690g. Fee contribution. 690h. Operational assistance grants. 690i. Bank participation. 690j. Federal Financing Bank. 690k. Reporting requirement. 690l. Examinations. 690m. Miscellaneous. 690n. Removal or suspension of directors or offi- cers. 690o. Regulations. 690p. Authorizations of appropriations. 690q. Termination. SUBCHAPTER IV—STATE CHARTERED INVEST- MENT COMPANIES AND STATE DEVELOPMENT COMPANIES 691. Repealed. SUBCHAPTER IV–A—GUARANTEES PART A—COMMERCIAL OR INDUSTRIAL LEASE AND QUALIFIED CONTRACT GUARANTEES 692. Authority of Administration to guarantee payment of rentals by small business con- cerns under leases of commercial and indus- trial property. 693. Powers of Administration respecting loans; liquidation of obligations through creation of new leases, execution of subleases, and assignments of leases. 694. Repealed. 694–1. Planning design or installation of pollution control facilities. 694–2. Revolving fund for qualified contract guaran- tees; investment of idle funds. PART B—SURETY BOND GUARANTEES 694a. Definitions. 694b. Surety bond guarantees. 694c. Revolving fund for surety bond guarantees. SUBCHAPTER V—LOANS TO STATE AND LOCAL DEVELOPMENT COMPANIES 695. State development companies. 696. Loans for plant acquisition, construction, conversion and expansion. 697. Development company debentures. 697a. Private debenture sales. 697b. Pooling of debentures. 697c. Restrictions on development company assist- ance. 697d. Accredited Lenders Program. 697e. Premier Certified Lenders Program. 697f. Prepayment of development company deben- tures. 697g. Foreclosure and liquidation of loans. SUBCHAPTER I—GENERAL PROVISIONS § 661. Congressional declaration of policy It is declared to be the policy of the Congress and the purpose of this chapter to improve and stimulate the national economy in general and the small-business segment thereof in particular by establishing a program to stimulate and sup- plement the flow of private equity capital and long-term loan funds which small-business con- cerns need for the sound financing of their busi- ness operations and for their growth, expansion, and modernization, and which are not available in adequate supply: Provided, however, That this policy shall be carried out in such manner as to insure the maximum participation of private fi- nancing sources. It is the intention of the Congress that the provisions of this chapter shall be so adminis- tered that any financial assistance provided hereunder shall not result in a substantial in- crease of unemployment in any area of the coun- try. It is the intention of the Congress that in the award of financial assistance under this chapter, when practicable, priority be accorded to small business concerns which lease or pur- chase equipment and supplies which are pro- duced in the United States and that small busi- ness concerns receiving such assistance be en- couraged to continue to lease or purchase such equipment and supplies. (Pub. L. 85–699, title I, § 102, Aug. 21, 1958, 72 Stat. 689; Pub. L. 102–366, title IV, § 416, Sept. 4, 1992, 106 Stat. 1019.) Editorial Notes REFERENCES IN TEXT This chapter, referred to in text, was in the original ‘‘this Act’’, meaning Pub. L. 85–699, which enacted this chapter, amended sections 77c, 77ddd, 80a–18, 633 and 636 of this title, and sections 217 [now 212], 218 [now 213], 221 [now 216], 657, 1006 and 1014 of Title 18, Crimes and Criminal Procedure, repealed section 352a of Title 12, Banks and Banking, and enacted notes set out under this section and section 352a of Title 12. Sections 212 and 213 of Title 18, as renumbered by Pub. L. 87–849, were subsequently repealed. For complete classifica- tion of this Act to the Code, see Short Title note set out below and Tables. AMENDMENTS 1992—Pub. L. 102–366 inserted at end ‘‘It is the inten- tion of the Congress that in the award of financial as- sistance under this chapter, when practicable, priority be accorded to small business concerns which lease or purchase equipment and supplies which are produced in the United States and that small business concerns re- ceiving such assistance be encouraged to continue to lease or purchase such equipment and supplies.’’ Statutory Notes and Related Subsidiaries SHORT TITLE OF 2018 AMENDMENT Pub. L. 115–371, § 1, Dec. 21, 2018, 132 Stat. 5106, pro- vided that: This Act [amending section 696 of this title] may be cited as the ‘‘Small Business Access to Capital and Efficiency Act’’ or the ‘‘Small Business ACE Act’’. Pub. L. 115–333, § 1, Dec. 19, 2018, 132 Stat. 4488, pro- vided that: ‘‘This Act [amending sections 662, 681, and 687 of this title] may be cited as the ‘Spurring Business in Communities Act of 2017’.’’ Pub. L. 115–187, § 1, June 21, 2018, 132 Stat. 1489, pro- vided that: ‘‘This Act [amending section 683 of this title] may be cited as the ‘Small Business Investment Opportunity Act of 2017’.’’ SHORT TITLE OF 2004 AMENDMENT Pub. L. 108–232, § 1, May 28, 2004, 118 Stat. 649, provided that:‘‘This Act [amending section 697e of this title] Page 1083 TITLE 15—COMMERCE AND TRADE § 661 may be cited as the ‘Premier Certified Lenders Pro- gram Improvement Act of 2004’.’’ SHORT TITLE OF 2001 AMENDMENT Pub. L. 107–100, § 1, Dec. 21, 2001, 115 Stat. 966, provided that: ‘‘This Act [amending sections 636, 683, 687d, 687e, and 697 of this title, section 1833a of Title 12, Banks and Banking, and section 1014 of Title 18, Crimes and Crimi- nal Procedure, and enacting provisions set out as notes under sections 636, 683, and 697 of this title] may be cited as the ‘Small Business Investment Company Amendments Act of 2001’.’’ SHORT TITLE OF 2000 AMENDMENT Pub. L. 106–554, § 1(a)(8) [§ 1(a)], Dec. 21, 2000, 114 Stat. 2763, 2763A–653, provided that: ‘‘This section [enacting part B of subchapter III of this chapter, amending sec- tion 683 of this title, section 109 of Title 11, Bank- ruptcy, and section 1464 of Title 12, Banks and Banking, and amending provisions set out as a note under sec- tion 631 of this title] may be cited as the ‘New Markets Venture Capital Program Act of 2000’.’’ Pub. L. 106–554, § 1(a)(9) [title III, § 301], Dec. 21, 2000, 114 Stat. 2763, 2763A–684, provided that: ‘‘This title [en- acting section 697g of this title, amending sections 695 to 697 and 697e of this title, enacting provisions set out as a note under section 697g of this title, and repealing provisions set out as a note under section 697e of this title] may be cited as the ‘Certified Development Com- pany Program Improvements Act of 2000’.’’ Pub. L. 106–554, § 1(a)(9) [title IV, § 401], Dec. 21, 2000, 114 Stat. 2763, 2763A–690, provided that: ‘‘This title [amending sections 662, 682, 683, and 687b of this title] may be cited as the ‘Small Business Investment Correc- tions Act of 2000’.’’ SHORT TITLE OF 1999 AMENDMENT Pub. L. 106–9, § 1, Apr. 5, 1999, 113 Stat. 17, provided that: ‘‘This Act [amending sections 662, 683, 687, and 687m of this title and provisions set out as notes under this section and section 631 of this title] may be cited as the ‘Small Business Investment Improvement Act of 1999’.’’ SHORT TITLE OF 1994 AMENDMENT Pub. L. 103–403, title V, § 501, Oct. 22, 1994, 108 Stat. 4198, provided that: ‘‘This title [enacting section 697f of this title and provisions set out as a note under section 697f of this title] may be cited as the ‘Small Business Prepayment Penalty Relief Act of 1994’.’’ SHORT TITLE OF 1992 AMENDMENT Pub. L. 102–366, title IV, § 401, Sept. 4, 1992, 106 Stat. 1007, provided that: ‘‘This Act [probably means ‘‘This title’’, amending this section and sections 662, 682, 683, 685 to 687, 687b, and 687l of this title, enacting provi- sions set out as notes under this section and sections 681 and 687b of this title, and amending provisions set out as a note under section 631 of this title] may be cited as the ‘Small Business Equity Enhancement Act of 1992’.’’ SHORT TITLE OF 1988 AMENDMENT Pub. L. 100–590, title II, § 201, Nov. 3, 1988, 102 Stat. 3007, provided that: ‘‘This title [amending sections 694b and 694c of this title and enacting provisions set out as notes under section 694b of this title] may be cited as the ‘Preferred Surety Bond Guarantee Program Act of 1988’.’’ SHORT TITLE OF 1972 AMENDMENT Pub. L. 92–595, § 1, Oct. 27, 1972, 86 Stat. 1314, provided: ‘‘That this Act [enacting sections 687i and 687j of this title and amending sections 80a–18, 633, 636, 662, 681, 683, 684, and 686 of this title] may be cited as the ‘Small Business Investment Act Amendments of 1972’.’’ SHORT TITLE OF 1967 AMENDMENT Pub. L. 90–104, title II, § 201, Oct. 11, 1967, 81 Stat. 269, provided that: ‘‘This title [amending sections 681, 682, 683, 684, 686, 687, 687b, and 692 of this title] may be cited as the ‘Small Business Investment Act Amendments of 1967’.’’ SHORT TITLE OF 1966 AMENDMENT Pub. L. 89–779, § 1, Nov. 6, 1966, 80 Stat. 1359, provided: ‘‘That this Act [enacting sections 687e, 687f, 687g, and 687h of this title and amending sections 633, 671, 687, 687a, 687b, and 687c of this title, and sections 5315 and 5316 of Title 5, Government Organization and Employ- ees] may be cited as the ‘Small Business Investment Act Amendments of 1966’.’’ SHORT TITLE OF 1964 AMENDMENT Pub. L. 88–273, § 1, Feb. 28, 1964, 78 Stat. 146, provided: ‘‘That this Act [enacting section 687d and amending sections 682, 686, and 687 of this title] may be cited as the ‘Small Business Investment Act Amendments of 1963’.’’ SHORT TITLE OF 1961 AMENDMENT Pub. L. 87–341, § 1, Oct. 3, 1961, 75 Stat. 752, provided: ‘‘That this Act [enacting sections 687a, 687b, and 687c of this title, amending sections 633, 662, 681, 683 to 687, and 696 of this title, and enacting provisions set out as notes under sections 631 and 686 of this title] may be cited as the ‘Small Business Investment Act Amend- ments of 1961’.’’ SHORT TITLE OF 1960 AMENDMENT Pub. L. 86–502, § 1, June 11, 1960, 74 Stat. 196, provided: ‘‘That this Act [amending sections 662, 681, 682, and 684 of this title, and section 26–610 of the District of Colum- bia Code, 1973 edition] may be cited as the ‘Small Busi- ness Investment Act Amendments of 1960’.’’ SHORT TITLE Pub. L. 85–699, title I, § 101, Aug. 21, 1958, 72 Stat. 689, as amended by Pub. L. 106–9, § 2(d)(3), Apr. 5, 1999, 113 Stat. 18, provided that: ‘‘This Act [enacting this chap- ter, amending sections 77c, 77ddd, 80a–18, 633 and 636 of this title, and sections 217 [now 212], 218 [now 213], 221 [now 216], 657, 1006 and 1014 of Title 18, Crimes and Criminal Procedure, repealing section 352a of Title 12, Banks and Banking, and enacting notes set out under this section and former section 352a of title 12] may be cited as the ‘Small Business Investment Act of 1958’.’’ REGULATIONS Pub. L. 102–366, title IV, § 415, Sept. 4, 1992, 106 Stat. 1018, provided that: ‘‘Notwithstanding any law, rule, regulation or administrative moratorium, except as otherwise expressly provided in this Act [probably means ‘‘this title’’, see Short Title of 1992 Amendment note above], the Small Business Administration shall— ‘‘(1) within 90 days after the date of enactment of this Act [Sept. 4, 1992], publish in the Federal Reg- ister proposed rules and regulations implementing this Act and the amendments made by this Act; and ‘‘(2) within 180 days after the date of enactment of this Act, publish in the Federal Register final rules and regulations implementing this Act, and enter such contracts as are necessary to implement this Act and the amendments made by this Act.’’ EFFECT OF SMALL BUSINESS EQUITY ENHANCEMENT ACT OF 1992 ON SECURITIES LAWS Pub. L. 102–366, title IV, § 418, Sept. 4, 1992, 106 Stat. 1019, provided that: ‘‘Nothing in this Act [probably means ‘‘this title’’, see Short Title of 1992 Amendment note above] (and no amendment made by this Act) shall be construed to affect the applicability of the securities laws, as that term is defined in section 3(a)(47) of the Securities Exchange Act of 1934 [15 U.S.C. 78c(a)(47)], or any of the rules and regulations thereunder, or other- wise supersede or limit the jurisdiction of the Securi- ties and Exchange Commission or the authority at any time conferred under the securities laws.’’ Page 1084 TITLE 15—COMMERCE AND TRADE § 662 § 662. Definitions As used in this chapter— (1) the term ‘‘Administration’’ means the Small Business Administration; (2) the term ‘‘Administrator’’ means the Ad- ministrator of the Small Business Administra- tion; (3) the terms ‘‘small business investment company’’, ‘‘company’’, and ‘‘licensee’’ mean a company approved by the Administration to operate under the provisions of this chapter and issued a license as provided in section 681 of this title; (4) the term ‘‘State’’ includes the several States, the territories and possessions of the United States, the Commonwealth of Puerto Rico, and the District of Columbia; (5) the term ‘‘small-business concern’’ shall have the same meaning as in the Small Busi- ness Act [15 U.S.C. 631 et seq.], except that, for purposes of this chapter— (A) an investment by a venture capital firm, investment company (including a small business investment company) em- ployee welfare benefit plan or pension plan, or trust, foundation, or endowment that is exempt from Federal income taxation— (i) shall not cause a business concern to be deemed not independently owned and operated regardless of the allocation of control during the investment period under any investment agreement between the business concern and the entity mak- ing the investment; (ii) shall be disregarded in determining whether a business concern satisfies size standards established pursuant to section 3(a)(2) of the Small Business Act [15 U.S.C. 632(a)(2)]; and (iii) shall be disregarded in determining whether a small business concern is a smaller enterprise; and (B) in determining whether a business con- cern satisfies net income standards estab- lished pursuant to section 3(a)(2) of the Small Business Act [15 U.S.C. 632(a)(2)], if the business concern is not required by law to pay Federal income taxes at the enter- prise level, but is required to pass income through to the shareholders, partners, bene- ficiaries, or other equitable owners of the business concern, the net income of the busi- ness concern shall be determined by allow- ing a deduction in an amount equal to the sum of— (i) if the business concern is not required by law to pay State (and local, if any) in- come taxes at the enterprise level, the net income (determined without regard to this subparagraph), multiplied by the marginal State income tax rate (or by the combined State and local income tax rates, as appli- cable) that would have applied if the busi- ness concern were a corporation; and (ii) the net income (so determined) less any deduction for State (and local) income taxes calculated under clause (i), multi- plied by the marginal Federal income tax rate that would have applied if the busi- ness concern were a corporation; (6) the term ‘‘development companies’’ means enterprises incorporated under State law with the authority to promote and assist the growth and development of small-business concerns in the areas covered by their oper- ations; (7) the term ‘‘license’’ means a license issued by the Administration as provided in section 681 of this title; (8) the term ‘‘articles’’ means articles of in- corporation for an incorporated body and means the functional equivalent or other simi- lar documents specified by the Administrator for other business entities; (9) the term ‘‘private capital’’— (A) means the sum of— (i) the paid-in capital and paid-in surplus of a corporate licensee, the contributed capital of the partners of a partnership li- censee, or the equity investment of the members of a limited liability company li- censee; and (ii) unfunded binding commitments, from investors that meet criteria estab- lished by the Administrator, to contribute capital to the licensee: Provided, That such unfunded commitments may be counted as private capital for purposes of approval by the Administrator of any request for lever- age, but leverage shall not be funded based on such commitments; and (B) does not include any— (i) funds borrowed by a licensee from any source; (ii) funds obtained through the issuance of leverage; or (iii) funds obtained directly or indirectly from any Federal, State, or local govern- ment, or any government agency or instru- mentality, except for— (I) funds obtained from the business revenues (excluding any governmental appropriation) of any federally chartered or government-sponsored corporation es- tablished prior to October 1, 1987; (II) funds invested by an employee wel- fare benefit plan or pension plan; and (III) any qualified nonprivate funds (if the investors of the qualified nonprivate funds do not control, directly or indi- rectly, the management, board of direc- tors, general partners, or members of the licensee); (10) the term ‘‘leverage’’ includes— (A) debentures purchased or guaranteed by the Administration; (B) participating securities purchased or guaranteed by the Administration; and (C) preferred securities outstanding as of October 1, 1995; (11) the term ‘‘third party debt’’ means any indebtedness for borrowed money, other than indebtedness owed to the Administration; (12) the term ‘‘smaller enterprise’’ means any small business concern that, together with its affiliates— (A) has— (i) a net financial worth of not more than $6,000,000, as of the date on which as- sistance is provided under this chapter to that business concern; and