S 1518 IS
105th CONGRESS
1st Session
S. 1518
IN THE SENATE OF THE UNITED STATES
Mr. BENNETT introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs
A BILL
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
This Act may be cited as the `Year 2000 Computer Remediation and Shareholder (CRASH) Protection Act of 1997'.
(a) FINDINGS- Congress finds that--
(1) most computer systems in the United States and around the world are not prepared to operate successfully after January 1, 2000;
(2) the failure of computer systems to operate correctly after January 1, 2000 threatens the interest of consumers and investors, the financial results of United States corporations, and the continued soundness of the global economy;
(3) corporations have not provided adequate disclosure on the Year 2000 readiness of their computer systems, the costs of remediation, and their ability to manage the business risks associated with possible computer system problems after January 1, 2000;
(4) corporations may resist making specific disclosures about their management of the `Year 2000 Problem' fearing competitive disadvantage; and
(5) disclosure of Year 2000 readiness by publicly traded corporations will promote the free flow of information on this issue, further the remediation effort, and help business and government leaders avert a potential economic downturn.
(b) PURPOSES- The purposes of this Act are to ensure that--
(1) publicly traded corporations disclose specific information about the Year 2000 readiness of their computer systems and their ability to manage the business risks associated with possible computer system problems after January 1, 2000; and
(2) the interests of consumers and investors are adequately protected.
(a) INCORPORATED DEFINITIONS- In this section, the terms `Commission', `issuer', and `security' have the meanings given those terms in section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c).
(b) DISCLOSURES REQUIRED- Not later than 120 days after the date of enactment of this Act, the Commission shall amend the regulations promulgated pursuant to section 13 of the Securities Exchange Act of 1934 (15 U.S.C. 78m) to require each issuer of a security registered pursuant to section 12 of that Act (15 U.S.C. 78l) to include, in each initial offering statement and in each quarterly report filed with the Commission under section 13 of that Act--
(1) a description of the progress of the issuer in completing the 5 recognized phases of Year 2000 remediation (i.e., awareness, assessment, renovation, validation, and implementation), by division, department, or other appropriate business unit of the issuer;
(2) a summary of costs incurred by the issuer in connection with any remediation effort described in paragraph (1) and an estimate of additional costs that the issuer expects to incur in connection with future remediation efforts;
(3) an estimate of anticipated litigation costs and liability outlays associated with the defense of legal actions against the issuer (or the directors or officers of the issuer) as a result of Year 2000 computer system problems, including breach of contract, tort, shareholder class action, and product liability actions;
(4) information relating to the existence of any insurance policies of the issuer that cover specific Year 2000 computer system problems, as well as the defense of legal actions against the issuer (and the officers and directors of the issuer) in connection with those problems; and
(5) information relating to any contingency plans developed by the issuer to ensure continued operation of the essential business functions of the issuer in the event of a Year 2000 computer system problem by the issuer itself or by a vendor, partner, or other affiliate of the issuer.
END