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Board Report: 2013-AE-B-008 July 1, 2013

Board Should Enhance Compliance with Small Entity Compliance Guide Requirements Contained in the Small Business Regulatory Enforcement Fairness Act of 1996

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Appendix A Scope and Methodology

Our evaluation assessed the Board's compliance with the following SBREFA small entity compliance guide requirements:

  • Publish one or more guides to assist small entities in complying with the rule, and title such publications "small entity compliance guides."
  • Publish the guide in an easily identified location on the agency's website.
  • Distribute the guide to known industry contacts affected by the rule, such as small entities, associations, or industry leaders.
  • Publish the guide on the same date as the date of publication of the final rule (or as soon as possible after that date), but no later than the effective date of the rule.
  • Explain the actions a small entity should take to comply with a rule, including actions to (1) meet the requirements of a rule and (2) enable a small entity to know when such requirements have been satisfied.
  • Use sufficiently plain language likely to be understood by affected small entities in accordance with the agency's sole discretion, taking into account the subject matter of the rule and the language of relevant statutes.

Initially, we selected 15 final rules promulgated after the 1996 enactment of SBREFA as our preliminary sample. However, to fully assess the Board's compliance with the 2007 amendments to SBREFA outlined above, we reduced our final sample to the 11 rules promulgated after the 2007 amendments. We reviewed the Board's FRFAs that accompanied the remaining 11 final rules in our sample. This review further reduced the size of our sample, because the Board had determined that 5 of the 11 rules would not have a significant impact on small entities and did not trigger the creation of small entity compliance guides. Therefore, we reduced our initial sample of 15 final rules to 6-Regulation AA, Unfair or Deceptive Acts or Practices; Regulation E, Electronic Fund Transfers; and 4 rules related to Regulation Z, Truth in Lending (each final rule in our sample is summarized in appendix B).

To determine whether the Board complied with SBREFA requirements, we reviewed the compliance guides for these rules available on the Board's public website and we assessed the Board's compliance with SBREFA's congressional annual reporting requirement. We also evaluated the small entity compliance guides for Regulation P, Privacy of Consumer Information, and Regulation GG, Prohibition on Funding of Unlawful Internet Gambling, to supplement our final sample (listed in appendix B) because these guides were in a more narrative format that differed from many of the guides in our sample originally selected. In addition, we reviewed guides created by another federal banking regulator as well as the small entity compliance guide development process of yet another federal agency.

As part of our evaluation, we interviewed Board staff from DCCA and the Legal Division who assisted in creating compliance guides to understand each division's process for creating compliance guides. It is our understanding that DCCA created the compliance guides we evaluated, except for the Regulation GG compliance guide, which the Board's Legal Division drafted.