March 3, 2005

Uniform Securities Act of 2002 Subcommittee of the Michigan Bar Association
Business Law Section

1.  Budget Request for 2004-2005

None

2.  Use of Budgeted Funds in 2003-2004.

None

3. Next Scheduled Meeting of the Committee

To be determined after reintroduction of the Uniform Securities Act in the legislature and meetings with OFIS.

4. Council Approval

None.

5.  Membership

We currently have 45 members, including the co-chairs. No targeted diversity effort has been made to date. We are presently unaware of the diversity composition of our membership which will change after our first meeting, We have not held a meeting recently since we have been awaiting passage of the law, which has failed the past two years. We had previously received comments on the law, and there have been no material changes requiring committee comment. We believe that OFIS will request our assistance in drafting rules for the new law once it is enacted, and we will reconvene the committee for that purpose.

6.  Accomplishments Toward Committee Objectives

The proposed Michigan version of the Uniform Securities Act of 2002 was resubmitted as HB 5746 by Rep. James Koetje of the 86th District. Committee member and former representative Andrew Richner has been coordinating this legislation with changes from NCCUSL to update the bill. The bill was referred out of committee, but died in the House in a dispute with the banking and insurance industries over provisions in the Act. We did not have the strength to move the bill forward over this opposition, even if we tried to make the bill neutral on these points. OFIS Commissioner Linda Watters is adamant about the bill not progressing without including the regulation of Variable Annuities under the securities laws. However, we have gotten little support on that issue from OFIS, which seems to be marching to the beat of its own drummer, and has made no effort to include us in its efforts, despite our requests to cooperate.

7.  Meetings and Programs

None at present time, but OFIS has asked our committee to assist with rule drafting as adoption of the bill nears fruition.

8.  Publications

None.

9.  Legislative/Judicial/Administrative Developments

House Bill 5746 was voted out of the Commerce Committee and sent to the full House for consideration.   It died there because of two controversial matters relating to the bill.  OFIS is insisting that they won't support the bill unless variable annuities are included within the definition of security.    Also, the banking exclusion from the present Michigan Uniform Securities Act is continued in this law, despite the changes made at the federal level as the result of Gramm Leach Bliley.  OFIS has taken no position on that issue, but the Securities Industry Association opposes the bill if the functional regulation concept is not adopted and efforts at compromise without the assistance of OFIS have not been productive to date.  

10.  Miscellaneous

None.

Dated: February 25 2005

Respectfully submitted,

Hugh H. Makens
Warner, Norcross & Judd LLP
900 Fifth Third Center
111 Lyon Street NW
Grand Rapids, Michigan 49503-3487
616-752-2117

Cyril Moscow
Honigman Miller Schwartz & Cohn
2290 First National Building
Detroit, Michigan 48226
313-465-7486

December 4, 2004

Uniform Securities Act of 2002 Subcommittee of the Michigan Bar Association, Business Law Section 

1. Budget Request for 2004-2005

$200

2. Use of Budgeted Funds in 2003-2004.

none

 3. Next Scheduled Meeting of the Committee

To be determined after discussion of the Uniform Securities Act HB 5746 from the Legislative Service Bureau.

4. Council Approval

None.

5. Membership

We last corresponded with our members on April 2, 2003 and on July 24, 2003 to provide status reports.  We currently have 45 members, including the co-chairs.  No targeted diversity effort has been made to date.  We are presently unaware of the diversity composition of our membership which will change after our first meeting, which is anticipated in the Fall of 2004 if our Uniform Securities Act bill progresses.

6. Accomplishments Toward Committee Objectives

The proposed Michigan version of the Uniform Securities Act of 2002 has been resubmitted as HB 5746 by Rep. James Koetje of the 86th District.  Andrew Richner has been coordinating this legislation with changes from NCCUSL to update the bill.  We will meet with Rep. Koetje at the end of this month to discuss strategies for adoption, and will thereafter contact our committee with a status report. 

7. Meetings and Programs

None at present time, but OFIS has asked our committee to assist with rule drafting as adoption of the bill nears fruition.

8. Publications

None.

9.  Legislative/Judicial/Administrative Developments

House Bill 5746 was voted out of the Commerce Committee and sent to the full House for consideration.   The House will not consider the bill until after it returns from the Thanksgiving recess.  There are two controversial matters relating to the bill.  OFIS is insisting that they won't support the bill unless variable annuities are included within the definition of security.  The House Committee on a 3 for inclusion, 4 against, and 6 abstaining, voted not to include variable annuities at this time, but stated that additional consideration would be given to that issue prior to House consideration.  Also, the banking exclusion from the present Michigan Uniform Securities Act is continued in this law, despite the changes made at the federal level as the result of Gramm Leach Bliley.  OFIS has taken no position on that issue, but the Securities Industry Association opposes the bill if the functional regulation concept is not adopted. The end of the legislative session further complicates the situation.

10. Miscellaneous

We seek council support for HB 5746.

Hugh H. Makens
Cyril Moscow

September 23, 2004

No report.

May 22, 2004

Uniform Securities Act of 2002 Subcommittee of the Michigan Bar Association, Business Law Section

1. Next Scheduled Meeting of the Committee

To be determined after discussion of the Uniform Securities Act HB 5746 from the Legislative Service Bureau.

2. Council Approval

None.

3. Membership

We last corresponded with our members on April 2, 2003 and on July 24, 2003 to provide status reports. We currently have 45 members, including the co-chairs. No targeted diversity effort has been made to date. We are presently unaware of the diversity composition of our membership which will change after our first meeting, which is anticipated in the Fall of 2004 if our Uniform Securities Act bill progresses.

4. Accomplishments Toward Committee Objectives

The proposed Michigan version of the Uniform Securities Act of 2002 has been resubmitted as HB 5746 by Rep. James Koetje of the 86th District. Andrew Richner has been coordinating this legislation with changes from NCCUSL to update the bill. We will meet with Rep. Koetje at the end of this month to discuss strategies for adoption, and will thereafter contact our committee with a status report.

5. Meetings and Programs

None at present time, but OFIS has asked our committee to assist with rule drafting as adoption of the bill nears fruition.

6. Publications

None.

7. Legislative/Judicial/Administrative Developments

Introduction of HB 5746.

8. Miscellaneous

None.

Hugh H. Makens
Cyril Moscow

Uniform Securities Act of 2002 Subcommittee of the Michigan Bar Association, Business Law Section

1.Next Scheduled Meeting of the Committee

To be determined upon receipt of a Uniform Securities Act draft from the Legislative Service Bureau.

2.Council Approval

None.

3. Membership

We have corresponded with our members on April 2, 2003 and on July 24, 2003 to provide status reports. We currently have 45 members, including the co-chairs. No targeted diversity effort has been made to date. We are presently unaware of the diversity composition of our membership which will change after our first meeting.

4. Accomplishments Toward Committee Objectives

The Committee had a good response to its invitation to the membership. Review of the proposed Michigan version of the Uniform Securities Act of 2002 has been delayed by the need to organize the legislative process and obtain the views and cooperation of the Office of Financial and Insurance Services. The bill is not yet before the legislature, but is in the Legislative Service Bureau.

5. Meetings and Programs

None at present time.

6. Publications

None.

7. Legislative/Judicial/Administrative Developments

None until the Bill is introduced.

8. Miscellaneous

None.

Hugh H. Makens
Cyril Moscow

Uniform Securities Act of 2002 Subcommittee of the Michigan Bar Association, Business Law Section

1.Next Scheduled Meeting of the Committee

To be determined upon receipt of a Uniform Securities Act draft from the Office of Financial and Insurance Services ("OFIS").

2.Council Approval

None.

3. Membership

We have corresponded with our members on April 2, 2003 and on July 24, 2003 to provide status reports. Our subcommittee was recently formed and we currently have 45 members, including the co-chairs. No targeted diversity effort has been made to date. We are presently unaware of the diversity composition of our membership which will change after our first meeting.

4. Accomplishments Toward Committee Objectives

The Committee had a good response to its invitation to the membership. Review of the proposed Michigan version of the Uniform Securities Act of 2002 has been delayed by the need to organize the legislative process and obtain the views and cooperation of the Department of Industry and Consumer Affairs. The bill is not yet before the legislature.

5. Meetings and Programs

None at present time.

6. Publications

None.

7. Legislative/Judicial/Administrative Developments

None until the Bill is introduced.

8. Miscellaneous

None.

Hugh H. Makens
Cyril Moscow