Bill Text: NY A00712 | 2015-2016 | General Assembly | Introduced


Bill Title: Relates to the provision of certain financial services to debt evading foreign states.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2016-01-06 - referred to ways and means [A00712 Detail]

Download: New_York-2015-A00712-Introduced.html
                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                          712
                              2015-2016 Regular Sessions
                                 I N  A S S E M B L Y
                                    January 7, 2015
                                      ___________
       Introduced  by  M.  of  A.  ROSENTHAL  --  read once and referred to the
         Committee on Ways and Means
       AN ACT to amend the tax law, in relation to  the  provision  of  certain
         financial services to debt evading foreign states
         THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
       BLY, DO ENACT AS FOLLOWS:
    1    Section 1. The tax law is amended by adding a new article 15  to  read
    2  as follows:
    3                                 ARTICLE 15
    4     TAX ON THE PROVISION OF CERTAIN FINANCIAL SERVICES TO DEBT EVADING
    5                               FOREIGN STATES
    6  SECTION 330. DEFINITIONS.
    7          331. IMPOSITION OF TAX.
    8          332. REPORTS AND ADDITIONAL MEASURES.
    9    S 330. DEFINITIONS. AS USED IN THIS ARTICLE, THE FOLLOWING TERMS SHALL
   10  HAVE THE FOLLOWING MEANINGS:
   11    1. "AGENCY OR INSTRUMENTALITY OF A FOREIGN STATE" MEANS ANY ENTITY:
   12    (A) WHICH IS A SEPARATE LEGAL PERSON, CORPORATE OR OTHERWISE, AND
   13    (B)  WHICH  IS  AN ORGAN OF A FOREIGN STATE OR A PROVINCE OR POLITICAL
   14  SUBDIVISION THEREOF, OR A MAJORITY OF WHOSE SHARES  OR  OTHER  OWNERSHIP
   15  INTEREST IS OWNED BY A FOREIGN STATE OR A PROVINCE OR POLITICAL SUBDIVI-
   16  SION THEREOF, AND
   17    (C)  WHICH  IS  NEITHER A CITIZEN OF A STATE OF THE UNITED STATES, NOR
   18  CREATED UNDER THE LAWS OF ANY THIRD COUNTRY.
   19    2. "FINAL JUDGMENT" MEANS ANY JUDGMENT THAT IS NO LONGER  ELIGIBLE  TO
   20  BE APPEALED TO ANY COURT.
   21    3.  "FINANCIAL  INSTITUTION" MEANS THE OFFICE OR BRANCH IN NEW YORK OF
   22  ANY BANK OR BANKING ORGANIZATION, WHETHER FOREIGN OR DOMESTIC,  THAT  IS
   23  REGULATED  BY  THE DEPARTMENT OF FINANCIAL SERVICES OF THIS STATE OR ANY
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD04099-01-5
       A. 712                              2
    1  AGENCY OR DEPARTMENT OF THE UNITED STATES, OR ANY TRUST COMPANY  OR  ANY
    2  OTHER  PROVIDER  OF PAYING AGENT SERVICES, FISCAL AGENT SERVICES, OR ANY
    3  OTHER SIMILAR SERVICES.
    4    4.  "PAYING  AGENT  AND  FISCAL  AGENT  SERVICES" MEANS THE PAYMENT OR
    5  DISBURSEMENT IN NEW YORK BY  A  FINANCIAL  INSTITUTION  OF  ALL  OR  ANY
    6  PORTION  OF  PRINCIPAL  OR INTEREST ON A BOND, NOTE AND OTHER OBLIGATION
    7  ISSUED BY DEBT EVADING FOREIGN STATES.
    8    5. "FOREIGN STATE" MEANS ANY GOVERNMENTAL UNIT OTHER THAN  THE  UNITED
    9  STATES,  OR  ANY  STATE,  DISTRICT,  COMMONWEALTH,  TERRITORY OR INSULAR
   10  POSSESSION THEREOF, AND INCLUDES A PROVINCE OR POLITICAL SUBDIVISION  OF
   11  A FOREIGN STATE.
   12    6. (A) "DEBT EVADING FOREIGN STATE" MEANS ANY FOREIGN STATE THAT:
   13    (I) HAS ONE OR MORE FINAL JUDGMENTS ENTERED AGAINST IT BY ANY STATE OR
   14  FEDERAL  COURT  LOCATED  IN  NEW  YORK,  INCLUDING  ANY  FINAL  JUDGMENT
   15  ORIGINALLY ISSUED IN A FOREIGN COURT THAT IS FILED OR REGISTERED IN  NEW
   16  YORK,  IN  THE  COMBINED  AMOUNT  OF  WHICH JUDGMENTS EXCEED ONE HUNDRED
   17  MILLION DOLLARS;
   18    (II) FAILS TO SATISFY IN FULL ANY SUCH JUDGMENT FOR A PERIOD  OF  MORE
   19  THAN  TWO  YEARS AFTER THE JUDGMENT BECOMES A FINAL JUDGMENT, REGARDLESS
   20  OF WHETHER SUCH JUDGMENT BECAME A FINAL JUDGMENT BEFORE THE DATE OF  THE
   21  ENACTMENT OF THIS SUBDIVISION; AND
   22    (III) IS NOT A FOREIGN STATE ELIGIBLE FOR:
   23    (1)   FINANCING  THROUGH  THE  INTERNATIONAL  DEVELOPMENT  ASSOCIATION
   24  (UNLESS SUCH STATE IS ELIGIBLE FOR FINANCING FROM THE INTERNATIONAL BANK
   25  FOR RECONSTRUCTION AND DEVELOPMENT); OR
   26    (2) DEBT RELIEF UNDER THE ENHANCED  HIPC  INITIATIVE  (AS  DEFINED  IN
   27  SECTION  1625(E)(3)  OF THE UNITED STATES INTERNATIONAL FINANCIAL INSTI-
   28  TUTIONS ACT); OR
   29    (3) DEBT RELIEF UNDER THE MULTILATERAL DEBT RELIEF INITIATIVE  OF  THE
   30  INTERNATIONAL MONETARY FUND.
   31    (B)  FOR  PURPOSES  OF  THIS  ARTICLE,  REFERENCES  TO A 'DEBT EVADING
   32  FOREIGN STATE' SHALL INCLUDE 'AGENCY OR  INSTRUMENTALITY  OF  A  FOREIGN
   33  STATE' AND 'STATE-OWNED CORPORATION OF A DEBT EVADING FOREIGN STATE,' AS
   34  DEFINED IN THIS SECTION.
   35    7. "STATE-OWNED CORPORATION OF A DEBT EVADING FOREIGN STATE" MEANS ANY
   36  CORPORATION  OR  ENTITY (OTHER THAN A NATURAL PERSON), A MAJORITY OF THE
   37  SHARES OR OTHER OWNERSHIP INTEREST OF WHICH IS HELD, EITHER DIRECTLY  OR
   38  INDIRECTLY,  BY  A DEBT EVADING FOREIGN STATE OR BY AN AGENCY OR INSTRU-
   39  MENTALITY OF A DEBT EVADING FOREIGN STATE.
   40    8. "STATE" MEANS EACH OF THE SEVERAL STATES, THE DISTRICT OF COLUMBIA,
   41  AND ANY COMMONWEALTH, TERRITORY OR POSSESSION OF THE UNITED STATES.
   42    S 331. IMPOSITION OF TAX. 1. THERE IS HEREBY IMPOSED AND SHALL BE PAID
   43  A TAX ON EACH PROVISION IN NEW YORK OF INITIAL PAYING AGENT SERVICES  OR
   44  FISCAL  AGENT  SERVICES  BY  A  FINANCIAL  INSTITUTION TO A DEBT EVADING
   45  FOREIGN STATE.
   46    2. THE TAX IMPOSED SHALL BE AT A RATE OF FOUR  PERCENT  OF  THE  GROSS
   47  AMOUNT  DISBURSED BY THE FINANCIAL INSTITUTION IN RELATION TO AND AT THE
   48  TIME OF EACH PROVISION OF SUCH SERVICE.
   49    3. THE ULTIMATE INCIDENCE OF AND LIABILITY FOR THE TAX SHALL  BE  UPON
   50  THE  DEBT  EVADING  FOREIGN  STATE  ON BEHALF OF WHICH SUCH PAYING AGENT
   51  SERVICE OR FISCAL AGENT SERVICE IS PROVIDED.  EACH FINANCIAL INSTITUTION
   52  THAT PROVIDES THE INITIAL PAYING AGENT OR FISCAL AGENT SERVICES  IN  NEW
   53  YORK  WITH  RESPECT  TO  ALL  OR ANY PORTION OF AN INTEREST OR PRINCIPAL
   54  PAYMENT ON BEHALF OF A DEBT EVADING FOREIGN STATE SHALL  BE  RESPONSIBLE
   55  FOR THE COLLECTION OF THE TAX FROM SUCH DEBT EVADING FOREIGN STATE ALLO-
   56  CABLE TO THE GROSS AMOUNT OF FUNDS IT DISBURSES AND FOR THE REMISSION OF
       A. 712                              3
    1  THE  TAX  TO  THE  TAX  COMMISSION. IN THE EVENT A FINANCIAL INSTITUTION
    2  DISBURSES ANY FUNDS IN RELATION TO  THE  PROVISION  OF  A  PAYING  AGENT
    3  SERVICE  OR FISCAL AGENT SERVICE WITHOUT REMITTING THE TAX IMPOSED BY OR
    4  PURSUANT  TO THIS ARTICLE TO THE TAX COMMISSION, SUCH FINANCIAL INSTITU-
    5  TION SHALL BE LIABLE FOR THE FULL AMOUNT OF SUCH TAX IMPOSED WHICH SHALL
    6  BE IMMEDIATELY DUE AND PAYABLE TO THE TAX COMMISSION.
    7    S 332. REPORTS AND ADDITIONAL MEASURES. 1. THE DEPARTMENT SHALL, ON  A
    8  MONTHLY  BASIS,  REVIEW  THE RECORDS OF UNSATISFIED JUDGMENTS ENTERED IN
    9  ALL FEDERAL AND STATE COURTS LOCATED IN THIS STATE TO IDENTIFY ALL  DEBT
   10  EVADING FOREIGN STATES.
   11    2.  THE  DEPARTMENT SHALL, ON A MONTHLY BASIS, POST TO ITS WEBSITE THE
   12  IDENTITIES OF ALL DEBT EVADING FOREIGN STATES OR OTHERWISE PUBLISH  SUCH
   13  IDENTITIES  IN  ANY OTHER MANNER REASONABLY CALCULATED TO GIVE NOTICE TO
   14  FINANCIAL INSTITUTIONS IN NEW YORK.  ANY FINANCIAL  INSTITUTION  SUBJECT
   15  TO  THIS  ARTICLE SHALL HAVE THE ABSOLUTE RIGHT TO RELY UPON THE LIST OF
   16  DEBT EVADING FOREIGN STATES POSTED OR PUBLISHED BY  THE  DEPARTMENT  FOR
   17  THE PURPOSE OF COMPLYING WITH THIS ARTICLE.
   18    3.  THE DEPARTMENT SHALL REPORT TO THE OFFICE OF THE NEW YORK ATTORNEY
   19  GENERAL THE NAMES OF ANY  FINANCIAL  INSTITUTIONS  THAT  THE  DEPARTMENT
   20  DETERMINES IS NOT COMPLYING WITH THIS ARTICLE.
   21    4.  THE DEPARTMENT AND THE ATTORNEY GENERAL MAY CONSIDER DOCUMENTS AND
   22  OTHER INFORMATION RECEIVED FROM THIRD  PARTIES,  FINANCIAL  INSTITUTIONS
   23  AND  DEBT EVADING FOREIGN STATES TO DETERMINE WHETHER A FOREIGN STATE IS
   24  A DEBT EVADING FOREIGN STATE.
   25    5. AT SUCH TIME AS THE DEPARTMENT DETERMINES THAT A FOREIGN  STATE  NO
   26  LONGER  QUALIFIES  AS A DEBT EVADING FOREIGN STATE, IT SHALL REMOVE FROM
   27  ITS WEBSITE THE DESIGNATION OF THE  FOREIGN  STATE  AS  A  DEBT  EVADING
   28  FOREIGN  STATE  OR TAKE SUCH OTHER ACTION AS IS REASONABLY CALCULATED TO
   29  GIVE NOTICE TO FINANCIAL INSTITUTIONS IN  NEW  YORK  THAT  SUCH  FOREIGN
   30  STATE IS NO LONGER DESIGNATED AS A DEBT EVADING FOREIGN STATE.
   31    S  2.  The  tax law is amended by adding a new section 1816 to read as
   32  follows:
   33    S 1816. ATTEMPT TO EVADE OR DEFEAT CERTAIN TAXES. ANY FINANCIAL INSTI-
   34  TUTION THAT WILLFULLY ATTEMPTS IN ANY MANNER TO EVADE OR DEFEAT ANY  TAX
   35  IMPOSED BY OR PURSUANT TO ARTICLE FIFTEEN OF THIS CHAPTER OR THE PAYMENT
   36  THEREOF SHALL, IN ADDITION TO OTHER PENALTIES PROVIDED BY LAW, BE GUILTY
   37  OF  A  MISDEMEANOR  PUNISHABLE  BY  A FINE OF NOT MORE THAN TEN THOUSAND
   38  DOLLARS PER OCCURRENCE.
   39    S 3. This act shall take effect on the thirtieth day  after  it  shall
   40  have  become  a  law  and  shall  apply  to any disbursement of funds in
   41  connection with the provision of a paying agent service or fiscal  agent
   42  service occurring on or after such effective date.
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