Consumer Bankruptcy Reform Act of 1998

TABLE OF CONTENTS:

Title I: Consumer Bankruptcy Provisions

Subtitle A: Needs Based Bankruptcy

Subtitle B: Consumer Bankruptcy Protections

Title II: Discouraging Bankruptcy Abuse

Title III: General Business Bankruptcy Provisions

Title IV: Small Business Bankruptcy Provisions

Title V: Municipal Bankruptcy Provisions

Title VI: Streamlining The Bankruptcy System

Title VIII: Bankruptcy Tax Provisions

Title IX: Ancillary and Other Cross-Border Cases

Title X: Financial Contract Provisions

Title XI: Technical Corrections

Title XII: Effective Date; Application of Amendments

Bankruptcy Reform Act of 1998 - Title I: Consumer Bankruptcy Provisions - Subtitle A: Needs Based Bankruptcy - Amends Federal bankruptcy law to revamp guidelines governing dismissal or conversion of a Chapter 7 liquidation petition (complete relief in bankruptcy), to one under Chapter 13 (Adjustment of Debts of an Individual with Regular Income). Allows a bankruptcy panel trustee and any party in interest to move for such dismissal or conversion (current law prohibits such party in interest from such motions). Lowers the "substantial abuse" standard for dismissal or conversion to one of simple abuse. Replaces the presumption in favor of granting the relief sought by the debtor with a presumption that abuse exists if the debtor's current monthly income exceeds specified formulae. Provides that the presumption of abuse may be rebutted only with detailed documentation of extraordinary circumstances requiring additional expenses or adjustment of currently monthly total income.

(Sec. 102) Requires debtor's counsel to: (1) reimburse the bankruptcy trustee for legal fees in prosecuting a dismissal or conversion motion if the court finds that counsel's filing under chapter 7 was not substantially justified; and (2) pay a civil penalty for the violation of certain bankruptcy rules.

(Sec. 103) Revises procedural guidelines to mandate written notice to the individual consumer debtor before commencement of a case that credit counseling services approved by the United States Trustee are available.

(Sec. 104) Instructs the Director of the Executive Office for U.S. Trustees to: (1) develop a financial management training curriculum and materials to educate individual debtors on how to better manage their finances; and (2) evaluate and report to the Congress on the curriculum's efficacy.

Subtitle B: Consumer Bankruptcy Petitions - Mandates specified notices and disclosures to a debtor by a debt relief counseling agency.

(Sec. 107) Sets forth a debtor's bill of rights which such agency must observe.

(Sec. 108) Declares invalid any waiver of debtor protections by the assisted person. Prescribes enforcement guidelines.

(Sec. 109) Expresses the sense of the Congress that States should develop curricula relating to the subject of personal finance, designed for use in elementary and secondary schools.

(Sec. 110) Modifies debt reaffirmation guidelines governing wholly unsecured consumer debts to mandate additional disclosures for dischargeable debt agreements.

(Sec. 111) Cites circumstances under which the court may reduce by up to 20 percent a claim based upon unsecured consumer debts if the debtor can show by clear and convincing evidence that the claim was filed by a creditor who unreasonably refused to negotiate a reasonable alternative repayment schedule proposed by an approved credit counseling agency acting on the debtor's behalf.

(Sec. 112) Directs the Board of Governors of the Federal Reserve System (the Board) to study and report to the Congress on: (1) whether a consumer engaging in either an open-end or closed-end credit transaction secured by the consumer's principal dwelling receives adequate information under Federal law regarding the tax deductibility of interest paid on such transaction; and (2) specifically consider whether additional disclosures are necessary in such transactions where the amount of credit extended exceeds the fair market value of the dwelling.

(Sec. 113) Instructs the Board to study and publicize existing protections limiting consumer liability for unauthorized use of a debit card or similar access device.

(Sec. 114) Amends the Truth in Lending Act (TILA) to prescribe disclosures regarding initial and annual minimum payments under an open-end credit plan. Instructs the Board to study and report to the Congress on whether consumers have adequate information about borrowing activities which may result in financial problems.

(Sec. 115) Amends bankruptcy law to exempt from the property of the bankrupt estate specified postsecondary education accounts placed in a qualified tuition program, or in an education individual retirement account.

(Sec. 116) Modifies guidelines governing the discharge of a debtor's liability, as well as the automatic stay, to entitle an individual who is injured by the willful failure of a creditor to credit payments received to bring an action for actual damages and legal fees.

(Sec. 118) Modifies exceptions to a discharge in bankruptcy to prohibit discharge of a filing fee imposed by any court upon a prisoner.

(Sec. 119) Terminates the automatic stay 30 days after filing of a petition if a chapter 7, 11, or 13 petition was pending and dismissed the previous year, unless the subsequent filing is in good faith. Delineates conditions under which a history of previous petitions in bankruptcy give rise to a rebuttable presumption that the case is not filed in good faith.

(Sec. 120) Directs the court to grant relief from the automatic stay upon request of a party in interest with respect to certain real property actions if the court finds that filing the bankruptcy petition was part of a scheme to delay, hinder, and defraud creditors. Denies automatic stay protections regarding certain creditors' enforcement actions against real property for a specified period following a prior order in bankruptcy which forbade the debtor from being a debtor in another bankruptcy case.

(Sec. 121) Modifies debtor's duties to mandate specified affirmative actions to be taken by a chapter 7 debtor, including reaffirmation of the debt, or redemption of the property within 45 days, in order to retain possession of personal property. Allows a creditor to take action with respect to such property under nonbankruptcy law if the debtor fails to act within 45 days, unless the court determines upon trustee motion that such property is consequential value or benefit to the estate.

(Sec. 122) Declares that the automatic stay is terminated regarding property of the debtor's estate securing a claim or subject to an unexpired lease, if the debtor fails to complete an intended surrender of consumer debt collateral within a revised, accelerated time frame (unless the court determines upon trustee motion that such property is of consequential value or benefit to the estate).

(Sec. 123) Instructs the bankruptcy court to confirm a chapter 13 plan if it provides that the holder of a secured allowed claim shall retain the attendant lien until payment or discharge of all debts.

Provides that if a chapter 13 proceeding is dismissed or converted without completion of the plan, the holder shall retain such lien to the extent recognized by applicable nonbankruptcy law.

(Sec. 124) Requires that the value of personal property collateral be at least equal to the outstanding balance of the purchase price, including interest and charges, where the property was acquired by the debtor within five years of filing the petition in bankruptcy.

(Sec. 125) Declares that, in the case of chapter 7 and chapter 13 debtors, the personal property securing an allowed claim shall be the replacement value as of the date the petition is filed without deduction for costs of sale or marketing.

(Sec. 126) Increases from 180 to 730 days the length of a debtor's location of domicile for purposes of determining which State law governs the debtor's selection of property exempt from the bankrupt estate.

(Sec. 127) Revises guidelines exempting property from the bankrupt estate to reduce the value of an interest in certain property used as a residence or burial plot to the extent that such value is attributable to any portion of property disposed by the debtor during a specified period with the intent to hinder, delay, or defraud a creditor and that the debtor could not have exempted had the property been held on the petition filing date.

(Sec. 128) Revises circumstances under which enforcement of rights and remedies of a secured party in either rolling stock equipment, or aircraft equipment and vessels, is subject to the automatic stay.

(Sec. 129) Revamps Chapter 13 debt discharge guidelines. Prohibits discharge from a debt for restitution or damages awarded in a civil action against the debtor for willful or malicious injury that caused personal injury or death of an individual.

(Sec. 130) Bankruptcy Judgeship Act of 1998 - Amends the Federal judicial code to mandate appointments for additional temporary bankruptcy judgeships in California, Florida, Maryland, Michigan, Mississippi, New Jersey, New York, Pennsylvania, Tennessee, and Virginia. Provides that the first vacancy occurring in such a district five years or more after a judge is appointed under this Act shall not be filled.

Extends temporary bankruptcy judgeship positions authorized for the northern district of Alabama, the eastern district of Tennessee, and the districts of Delaware, Puerto Rico, and South Carolina.

Directs each chief bankruptcy judge to report annually to the Director of the Administrative Office of the U.S. Courts on the travel expenses of each bankruptcy judge assigned to the applicable district.

(Sec. 131) Places in the tenth order of prioritized claims against the bankrupt estate any death or personal injury claims resulting from the unlawful operation of a motor vehicle or vessel because the debtor was drug or alcohol-impaired.

(Sec. 133) Revises requirements governing a stay of action against a chapter 13 codebtor who did not receive the consideration for a claim to provide a maximum 30-day automatic stay to the extent that the creditor proceeds against: (1) the individual that received the consideration; or (2) the property not in the possession of the debtor that secures that claim. States that such stay shall apply in any case in which the debtor is primarily obligated to pay under a legally binding separation or property settlement agreement or divorce or dissolution decree.

(Sec. 134) Denies a debtor an automatic stay of the commencement of an investigation or action by a securities self-regulatory organization to enforce compliance with its regulations, or of the enforcement of any order or decision obtained by such an organization, other than for monetary sanctions.

(Sec. 135) Reduces from $1,000 to $250 the threshold amount of luxury goods and consumer credit cash advances presumed nondischargeable in bankruptcy, if acquired within 90 days (currently 60 days) before an order for relief.

(Sec. 136) Provides for a chapter 7 debtor's assumption of executory contracts and unexpired leases of personal property. Declares that in a chapter 11 case in which the debtor is an individual, and in a chapter 13 case, if the lease is not assumed in the plan, it is rejected (and no longer subject to an automatic stay) as of the plan's confirmation date.

(Sec. 137) Delineates a cash payment plan for chapter 13 debtors for payments to any lessor of personal property and to any creditor holding a claim secured by personal property to the extent such claim is attributable to the debtor's purchase of such property.

(Sec. 139) Precludes an automatic stay of any transfer that is not avoidable in: (1) cases where the trustee serves as lien creditor and successor to certain creditors and purchasers; and (2) postpetition transactions.

Precludes an automatic stay of any eviction, unlawful detainer action, or similar proceeding by a lessor against a debtor involving residential real property in which: (1) the debtor resides and has not paid rent after the commencement and during the course of the case; (2) the rental agreement has terminated; or (3) the debtor has previously filed within the last year and failed to pay post-petition rent during the course of that case.

or (4) Precludes an automatic stay of any eviction actions based on endangerment to property or person or the use of illegal drugs.

(Sec. 140) Extends the period between chapter 7 discharges to eight years, and between chapter 13 discharges to five years.

(Sec. 142) Revises chapter 7 priority payment guidelines to place within the first priority claim category certain claims for domestic support obligations, on the condition that funds received by a governmental unit be applied in a prescribed order.

(Sec. 143) Conditions court confirmation of a chapter 11 or chapter 13 plan (and its consequent discharge of debts) upon certification of debtor's payment of domestic support obligations that are due after the petition filing date.

(Sec. 144) Excepts from an automatic stay specified choses-in- action pertaining to domestic support obligations, including: (1) establishment of paternity; (2) suspension of drivers' licenses and professional licenses; (3) interception of tax refunds; and (4) enforcement of medical obligations under title IV, part D (Child Support and Establishment of Paternity) of the Social Security Act.

(Sec. 146) Modifies guidelines governing property exempt from the bankruptcy estate to declare such property liable for domestic support obligations.

(Sec. 147) Precludes the bankruptcy trustee from avoiding a transfer that is a bona fide payment of a debt for a domestic support obligation.

(Sec. 149) Declares nondischargeable in bankruptcy: (1) debts intentionally incurred to pay a nondischargeable debt with the intent to discharge the newly-created debt; and (2) all debts incurred to pay nondischargeable debts, without regard to intent, if incurred within 90 days of the filing of the petition.

Title II: Discouraging Bankruptcy Abuse - Reenacts chapter 12 (Adjustment of Debts of a Family Farmer with Regular Annual Income).

(Sec. 202) Authorizes the bankruptcy court, upon request of a party in interest, to order that the U.S. trustee not convene a meeting of creditors or equity security holders if the debtor has filed a plan for which acceptances have been solicited before commencement of the case.

(Sec. 203) Permits an individual debtor to exempt from the property of the bankrupt estate certain tax-exempt retirement funds that have not been obligated in connection with any extension of credit.

Exempts from either an automatic stay or a discharge in bankruptcy specified income withheld from the debtor pursuant to pension or profit sharing plans sponsored by such debtor's employer to pay certain loans from such plans.

(Sec. 205) Amends guidelines for rejection and surrender of executory contracts and unexpired leases.

(Sec. 207) Prohibits the bankruptcy trustee from avoiding a warehouseman's lien for costs incidental to the storage and handling of certain goods.

(Sec. 209) Directs the bankruptcy court to treat the compensation awarded a trustee as a commission based on the results achieved.

(Sec. 210) States that acceptance or rejection of a chapter 11 plan may be solicited from a holder of a claim or interest if: (1) the solicitation complies with applicable nonbankruptcy law; and (2) it was made before commencement of the case in a manner complying with applicable nonbankruptcy law.

(Sec. 211) Prohibits the bankruptcy trustee from avoiding a transfer if, in a case filed by a debtor whose debts are not primarily consumer debts, the aggregate value of all property that constitutes or is affected by such transfer is less than $5,000.

(Sec. 213) Limits the extensions of time permitted for filing a chapter 11 reorganization plan.

(Sec 214) Denies a discharge in bankruptcy for a debt for a fee or assessment arising from a debtor's interest in a lot in a homeowners association for as long as the debtor retains specified interests in such lot.

(Sec. 215) Modifies guidelines governing cases ancillary to foreign proceedings to prohibit the court from granting relief with respect to any security required or permitted under State insurance law for the benefit of claim holders in the United States.

(Sec. 215 (sic)) Revises guidelines governing assumption of executory contracts and unexpired leases by the bankruptcy trustee. Exempts from mandatory cure by such trustee certain defaults arising from nonmonetary obligations under an unexpired lease of real property (excluding executory contracts that transfer a right or an interest under a filed or issued patent, copyright, trademark, trade dress, or trade secret), if it is impossible for the trustee to cure such default by performing nonmonetary acts at or after the time of assumption.

Title III: General Business Bankruptcy Provisions - Removes investment bankers from the definition of "disinterested person."

(Sec. 302) Denies bankruptcy eligibility to an individual unless the individual has received specified credit counseling within 90 days before petition filing. Authorizes the court to waive such prerequisite in specified circumstances. Grants the U.S. Trustee exclusive right to move for case dismissal for debtor non-compliance.

Predicates a chapter 7 or chapter 13 discharge upon debtor's completion of an instructional course concerning personal financial management.

Title IV: Small Business Bankruptcy Provisions - Sets forth mandatory factors for court consideration in determining whether the disclosure statement regarding a small business reorganization plan provides adequate information.

(Sec. 402) Defines a small business debtor, generally, as a person (including a debtor affiliate) with not more than $4 million in aggregate non-contingent, liquidated secured and unsecured debts as of the date of the petition or the order for relief (excluding debts owed to one or more affiliates or insiders).

(Sec. 403) Directs the Advisory Committee on Bankruptcy Rules of the Judicial Conference (Advisory Committee) to propose for adoption standardized disclosure statements and plans of reorganization for small business debtors.

(Sec. 404) Sets forth uniform national reporting requirements for small business debtors.

(Sec. 405) Directs the Advisory Committee to propose for adoption revisions to the Federal Rules of Bankruptcy Procedure and Official Bankruptcy Forms enabling small business debtors to comply with such uniform national reporting requirements.

(Sec. 406) Sets forth duties and administrative procedures in small business reorganization cases, including serial filer provisions and expanded grounds for dismissal or conversion and appointment of a trustee.

(Sec. 414) Directs the Small Business Administration to study and report to the Congress on: (1) the factors that cause small businesses to become debtors in bankruptcy; and (2) how Federal bankruptcy laws can be made more efficient in assisting small businesses to retain their viability.

(Sec. 415) Revises the circumstance where a debtor has commenced monthly payments to each secured interest creditor to allow the debtor, in the debtor's sole discretion, to make such payments from rents or other income generated before or after the commencement of the case by or from the property. Requires such payments in an amount equal to the interest on the value of the creditor's interest in the real estate, determined at the then-applicable contract rate of interest (currently, at the fair market rate).

Title V: Municipal Bankruptcy Provisions - Makes technical amendments to requirements for a municipal bankruptcy petition.

Title VI: Streamlining the Bankruptcy System - Authorizes a creditor holding a consumer debt to participate in a meeting of creditors in a chapter 7 or 13 case, either alone or in conjunction with an attorney.

(Sec. 602) Requires each U.S. trustee to report to the Attorney General on audit results. Requires the Attorney General to establish random audits of individual cases.

(Sec. 603) Prescribes notice procedures for chapter 7 and chapter 13 creditors.

Expands debtor's duties to require filing with the bankruptcy court: (1) all tax returns; (2) evidence of payments received; (3) monthly net income projections; and (4) anticipated debt or expenditure increases. Permits a chapter 7 or chapter 13 creditor to request the debtor's petition, schedules and statement of affairs, including the debt adjustment plan filed by the debtor. Mandates debtor compliance within five days of such request.

Mandates that, at the time of filing with the taxing authority, a chapter 7 or 13 debtor file with the bankruptcy court specified tax documentation pertaining to the period from case commencement until case termination.

Requires a chapter 13 debtor to file with the court a statement of income and expenditures in the preceding tax year, and monthly net income, showing how calculated.

Makes debtor's mandatory documentation available for inspection and copying to certain bankruptcy officers and any party in interest.

Requires debtors to furnish driver's license, passport or other photograph-containing documentation establishing debtor identification.

(Sec. 604) Provides for automatic dismissal if a chapter 7 debtor fails to furnish all mandatory information, or fails to timely file the requisite schedules. Requires the court to order dismissal within five days of a request by a party in interest for the debtor's failure to timely submit requisite documentation.

(Sec. 605) Prohibits a Chapter 13 confirmation hearing from being held less than 20 days after the first meeting of creditors if there is an objection.

Mandates filing of a chapter 13 debt readjustment plan within 90 days of the order for relief. (Sec. 606) Revises the current three-to-five-year length of a payment plan to set a maximum five year payment period under a chapter 13 plan for any individual debtor (or in a joint case, an individual and spouse combined) with a current monthly total income of not less than the highest national median household income reported for a family of equal or lesser size (or, in a household of one person, not less than the national median household income for one earner). Reserves the current three-to-five-year payment period to cases involving debtors (or in a joint case, an individual and spouse combined) with a current monthly total income less than the highest national median household income reported for a family of equal or lesser size (or, in a household of one person, less than the national median household income for one earner). Revises the maximum duration for a plan modified after confirmation.

(Sec. 607) Expresses the sense of the Congress that rule 9011 of the Federal Rules of Bankruptcy Procedure should include a requirement that all debtors' documents be submitted to the court only after debtors have made reasonable inquiry to verify that all information therein is well grounded in fact, and warranted by existing law or a good faith argument for extension, modification or reversal of existing law.

(Sec. 608) Amends the Federal judicial code to revise the requirement that a chapter 11 debtor pay quarterly fees to the U.S. Trustee for disbursements made during a quarter. Requires debtors with disbursements of less than $300,000 to pay such fee only until the case is converted or plan confirmation is obtained, whichever occurs first.

(Sec. 609) Directs the Comptroller General to study and report to the Congress and the President on the impact that credit extended to dependents enrolled in post-secondary educational institutions has upon the rate of cases filed in bankruptcy.

(Sec. 610) Revises automatic stay guidelines to provide that in the case of an individual filing under chapters 7, 11, or 13, the automatic stay shall terminate 60 days after a request for its release by a party in interest, unless the court orders or the parties agree to a longer time.

(Sec. 611) Revamps prescriptions governing the effects of conversion from chapter 13 to another chapter. Declares that: (1) valuations of property and of allowed secured claims in a chapter 13 case shall not apply in a case converted to chapter 7; and (2) with respect to cases converted from chapter 13, the claim of any creditor holding security as of the date of the petition shall continue to be secured by that security unless the full amount of that claim, as determined under applicable nonbankruptcy law, has been paid in full as of the date of conversion. States that a prebankruptcy default shall have the effect given under applicable nonbankruptcy law unless it has been fully cured pursuant to the plan at the time of conversion.

Title VII: Bankruptcy Data - Amends the Federal judicial code to require the clerk of each district to compile bankruptcy statistics for individual debtors with primarily consumer debts seeking relief under chapters 7, 11, and 13. Directs the Administrative Office of the United States Courts (Administrative Office) to make such statistics public and to report them annually to the Congress.

(Sec. 702) Instructs the Attorney General to promulgate requirements for uniform forms for: (1) final reports by trustees in cases under chapters 7, 12, and 13; and (2) periodic reports by chapter 11 debtors or trustees in possession. Prescribes report contents.

(Sec. 703) Expresses the sense of the Congress that the national policy should be that: (1) all public record data held in electronic form by bankruptcy clerks should be released in electronic form in bulk to the public subject to appropriate privacy concerns and safeguards as the Judicial Conference of the United States may determine; and (2) a bankruptcy data system should be established in which a single set of data definitions are used to collect data nationwide, and in which all data for any particular bankruptcy case are aggregated in the same electronic record.

Title VIII: Bankruptcy Tax Provisions - Amends the bankruptcy code to modify the treatment of certain tax liens.

(Sec. 802) Requires a debtor indebted to a governmental unit to furnish specified information concerning such debt, including the underlying basis for the governmental unit's claim.

Requires the Advisory Committee on Bankruptcy Rules of the Judicial Conference to propose for adoption enhanced rules for providing notice to Federal, State, and local government units that have regulatory authority over the debtor or which may be creditors in the debtor's case.

(Sec. 804) Prescribes the rate of interest to be paid on mandatory interest payments on tax claims.

(Sec. 805) Revises the specifications for income tax claims receiving eighth priority (allowed unsecured claims of governmental units). Provides for tolling of the time periods covering such tax claims for stays of proceedings in a prior bankruptcy case, and the pendency or effect of offers in compromise or installment agreements.

(Sec. 808) States that confirmation of a bankruptcy plan does not discharge a corporate debtor from any debt for a tax or customs duty with respect to which the debtor made a fraudulent return or willfully attempted to evade or defeat such tax.

(Sec. 809) Amends the automatic stay of U.S. Tax Court proceedings concerning the debtor to restrict such stay to tax liability for a taxable period ending before the order for relief.

States that the filing of a bankruptcy petition does not operate as a stay of an appeal from a judicial or administrative determination of the debtor's tax liability without regard to whether such determination was made prepetition or postpetition.

(Sec. 810) Includes among the requirements for court confirmation of a chapter 11 bankruptcy plan which includes tax claims, that the debtor, at the minimum, make regular cash installment payments, but in no case with a balloon provision, and no more than three months apart, beginning no later than the effective date of the plan and ending on the earlier of five years after the petition date or the last date payments are to be made under the plan to unsecured creditors.

(Sec. 811) Prohibits the avoidance of statutory tax liens by certain purchasers.

(Sec. 812) Amends the Federal judicial code to require officers and agents conducting any business under court authority to pay all Federal, State and local taxes when due in the course of the business, unless it is a property tax secured by a lien against estate property which is abandoned by the bankruptcy trustee, or payment of the tax is excused under a specific bankruptcy law. Cites circumstances in which payment of such taxes may be deferred in a case pending under chapter 7 until final distribution is made.

Entitles to administrative expense priority payment certain secured and postpetition unsecured taxes incurred by the bankruptcy estate, including ad valorem property taxes.

Declares that a governmental unit shall not be required to file a request for the payment of administrative expenses relating to a tax liability or tax penalty.

Allows a trustee to recover from property securing a claim for the payment of all ad valorem property taxes relating to such property.

(Sec. 813) Requires as a condition for payment of tardily filed priority tax claims that they be filed either before the trustee commences distribution or ten days following the mailing to creditors of the summary of the trustee's final report, whichever is earlier (currently, before the trustee commences distribution of the estate).

(Sec. 814) Makes nondischargeable any obligations based on income tax returns prepared by tax authorities.

(Sec. 815) Declares that an estate's liability for unpaid tax is discharged upon payment of such tax according to certain requirements.

(Sec. 816) Conditions court confirmation of a chapter 13 bankruptcy plan upon filing by the debtor: (1) of all prepetition tax returns; and (2) before the day on which the first meeting of the creditors is convened, of all tax returns for taxable periods ending in the three-year period that ends on the date of the filing of the petition. Authorizes the court to dismiss a plan, or to convert the case to a chapter 7 case, if a chapter 13 debtor fails to comply with such time frame.

Expresses the sense of the Congress that the Advisory Committee on Bankruptcy Rules of the Judicial Conference should propose for adoption amended Federal Rules of Bankruptcy Procedure pertaining to objections to tax claims and to plan confirmation.

(Sec. 817) Redefines "adequate disclosure," for postpetition disclosure and solicitation purposes, to include full discussion of the potential material Federal and State tax consequences of the plan to the debtor and to a hypothetical investor domiciled in the State in which the debtor resides or has its principal place of business typical of the holders of claims or interests in the case.

(Sec. 818) Denies an automatic stay, unless specified conditions are met, to the setoff of an income tax refund for a taxable period which ended before the order for relief against an income tax liability for a taxable period which also ended before the order for relief.

Title III: Ancillary and Other Cross-Border Cases - Expands the scope of bankruptcy law to incorporate the Model Law on Cross-Border Insolvency, and to establish a statutory mechanism for: (1) dealing with cases of cross-border insolvency; and (2) cooperation between U.S. courts, trustees, and debtors and their foreign counterparts. Prescribes guidelines for: (1) access by foreign representatives and creditors to Federal and State courts; (2) recognition of a foreign proceeding and relief; (3) cooperation and direct communication with foreign courts and representatives; and (4) concurrent proceedings and the coordination of foreign and domestic proceedings.

Title X: Financial Contract Provisions - Amends the Federal Deposit Insurance Act (FDIA) to redefine specified contracts, agreements, and transfers entered into with an insolvent insured depository institution before the appointment of a conservator or receiver for it.

(Sec. 1002) Declares that no person shall be stayed or prohibited from exercising any right to cause the acceleration of any qualified financial contract with an insured depository institution which arises upon the appointment of the Federal Deposit Insurance Corporation (FDIC) as receiver at any time after such appointment.

(Sec. 1002) Declares that no provision of law shall be construed as limiting the right or power of the FDIC, or authorizing any court or agency to limit or delay, in any manner, the FDIC's right or power to transfer, disaffirm, or repudiate any qualified financial contract of a failed institution.

Prohibits enforcement of a walkaway clause in a qualified financial contract of a failed insured depository institution (a clause that either does not create a payment obligation of a party, or extinguishes it solely because of such party's status as a nondefaulting party).

(Sec. 1003) Revises guidelines governing transfers of qualified financial contracts of an insolvent institution to include: (1) transfers to a foreign bank or foreign financial institution (including its branch or agency) (but only when the contractual rights of the parties to such qualified financial contracts are enforceable substantially to the same extent as permitted under such Act); and (2) transfers of contracts subject to the rules of a clearing organization. Defines financial institution to include a broker or dealer, a depository institution, a futures commission merchant, or any other institution as determined by FDIC regulation.

Suspends certain termination rights of counterparties to a qualified financial contract with an insolvent insured depository institution until after the receiver's appointment, or after receipt of notice that the contract has been transferred.

Declares that none of the following institutions shall be considered a financial institution for which a conservator, receiver, trustee in bankruptcy, or other legal custodian has been appointed or which is otherwise the subject of a bankruptcy or insolvency proceeding: (1) a bridge bank; or (2) an FDIC-organized depository institution for which a conservator is appointed either immediately upon organization, or at the time of a purchase and assumption transaction between such institution and the FDIC as receiver for a depository institution in default.

(Sec. 1004) Prescribes guidelines for: (1) the disaffirmance or repudiation of qualified financial contracts by the conservator or receiver for a failed depository institution; and (2) the treatment of a master agreement as a single agreement and a single qualified financial contract.

(Sec. 1006) Amends the Federal Deposit Insurance Corporation Improvement Act of 1991 to make conforming amendments with respect to: (1) bilateral netting contracts; (2) security agreements; (3) clearing organization netting contracts; (4) contracts with uninsured national banks; and (5) contracts with uninsured Federal branches or agencies.

(Sec. 1007) Amends the Federal Bankruptcy Code to reflect the changes made by this Act and to: (1) deny an automatic stay to set-offs under certain swap agreements and netting agreements; and (2) restrict the avoidance power of the bankruptcy trustee regarding certain master netting agreement transfers to those transfers that are fraudulent in nature.

Sets forth statutory guidelines for: (1) the termination or acceleration of designated contracts and agreements; and (2) commodity broker and stockbroker liquidation with respect to the priority of unsecured claims, or customer property or distributions.

(Sec. 1008) Amends the FDIA to authorize the FDIC to prescribe more detailed recordkeeping requirements for qualified financial contracts (including market valuations) by insured depository institutions.

(Sec. 1009) Exempts specified collateralization agreements from the contemporaneous execution requirement that renders invalid certain agreements against FDIC interests in certain asset acquisitions.

(Sec. 1010) Amends Federal bankruptcy law to specify the date for the measure of damages in connection with: (1) rejection by the bankruptcy trustee of designated contracts and agreements relating to executory contracts and unexpired leases; or (2) the liquidation, acceleration, or termination of such contracts and agreements.

(Sec. 1011) Amends the Securities Investor Protection Act of 1970 to provide that neither the filing of a protective decree by the Securities Investor Protection Corporation, nor any court protective order, shall operate as a stay of a creditor's contractual rights to liquidate, terminate, or accelerate designated contracts and agreements. Allows such application, order, or decree, however, to operate as a stay of foreclosure on securities collateral pledged by the debtor, whether or not with respect to one or more of such contracts, agreements, or securities sold by the debtor under a repurchase agreement.

(Sec. 1012) Declares that property of the bankrupt estate does not include any eligible asset (or its proceeds) to the extent that it was transferred by the debtor before commencement of the case to an eligible entity in connection with an asset-backed securitization (except to the extent that such asset, or its proceeds or value, may be recovered through avoidance by the bankruptcy trustee).

(Sec. 1013) Amends the Federal Reserve Act to increase the types of acceptances eligible to meet Federal Reserve collateral requirements.

Title XI: Technical Corrections - Makes technical corrections to Federal bankruptcy, judicial, and criminal law.

(Sec. 1101) Redefines single asset real estate to exclude family farms and to repeal the $4 million ceiling on the amount of noncontingent, liquidated secured debts on such property. Defines the term "transfer" to include: (1) creation of a lien; (2) retention of title as a security interest; (3) foreclosure of the debtor's equity of redemption; and (4) every mode of disposing of property or parting with an interest in property.

(Sec. 1102) Requires triennial adjustment of: (1) the $5,000 value of certain implements, professional books, tools of the trade, farm animals, and crops which a debtor may exempt from the property of the estate (protecting them from creditors' liens); and (2) the national median household income calculated monthly.

(Sec. 1106) Provides that a trustee or a creditors' and equity security holders' committee may pay a professional person they employ on a fixed or percentage fee basis, as well as on other bases already permitted.

(Sec. 1111) Excludes from compensable professional services any expenses incurred by an individual member of a creditors' and equity security holders' committee.

(Sec. 1113) Revises the prohibition against debtor avoidance of certain judicial liens in connection with a liability designated as, and actually in the nature of, alimony, maintenance, or support.

(Sec. 1114) Declares nondischargeable in bankruptcy a debt for death or personal injury caused by the debtor's operation of a watercraft or aircraft while intoxicated from alcohol, a drug, or other substance. Limits the nondischargeability of fees imposed by a court to fees so imposed on a prisoner.

(Sec. 1119) Revises guidelines governing preferences to provide that, if the trustee avoids a security interest given between 90 days and one year before the date of the filing of the petition, by the debtor to a non-insider for the benefit of a creditor that is an insider, then such security interest shall be considered to be avoided only with respect to the insider creditor.

(Sec. 1125) Requires the U.S. trustee in a chapter 11 (Reorganization) case to file a report certifying the election of an eligible, disinterested trustee at a meeting of creditors. Declares that upon such filing: (1) the trustee elected shall be considered to have been selected and appointed; and (2) the service shall terminate of any trustee previously appointed to fill the term of specified ineligible or incapacitated trustees.

(Sec. 1127) Permits the bankruptcy trustee to sell, use, or lease property in accordance with nonbankruptcy law governing the transfer of property by nonprofit charitable corporations, if doing so is not inconsistent with certain relief granted under the automatic stay.

(Sec. 1128) Amends the Truth in Lending Act to prohibit a creditor under an open end consumer credit plan from terminating an account before its expiration date solely because the consumer has not incurred finance charges.

(Sec. 1129) Extends from 20 to 30 days the length of time after a debtor receives possession of property for perfection of a security interest in such property created by a transfer which the trustee may not avoid.

(Sec. 1130) Amends the Federal judicial code to allow a U.S. trustee whose appointment to a panel or as a standing trustee is terminated or who ceases to be assigned to cases filed under the Federal bankruptcy code to obtain judicial review of the final agency decision by commencing an action in U.S. district court for the district in which the panel member or standing trustee resides, after exhausting all available administrative remedies which, if the trustee so elects, shall also include an administrative hearing on the record. Deems the trustee to have exhausted such remedies, unless the trustee elects to have an administrative hearing on the record, if the agency fails to make a final agency decision within 90 days after the trustee requests administrative remedies. Requires the agency decision to be affirmed unless it is unreasonable and without cause based upon the administrative record before the agency.

Authorizes a standing trustee to obtain judicial review of final agency action to deny a claim of actual, necessary expenses by commencing an action in U.S. district court in the district where the individual resides. Requires the agency decision to be affirmed unless it is unreasonable and without cause based upon the administrative record before the agency.

Directs the Attorney General to prescribe procedures to implement such provisions.

Title XII: General Effective Date; Application of Amendments - Sets forth the effective date of this Act and the application of its amendments.