OCC Dodd-Frank Preemption Rule is Final
The Office of the Comptroller of the Currency (OCC) recently issued a final rule regarding amendments to its regulations, pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank). With respect to the provisions affecting preemption and visitorial powers, the OCC concluded that Dodd-Frank does not create a stand-alone preemption standard but incorporates the Supreme Court’s Barnett Bank conflict preemption standard and the reasoning that supports it.
Earlier this Summer, the OCC issued a proposed rule that Dodd-Frank’s preemption provision be read to include “the whole of the conflict preemption analysis” in Barnett Bank. In response, the Department of the Treasury issued a comment letter, addressing concerns with the OCC’s interpretation of Dodd-Frank preemption.
The Treasury Department raised three principal concerns with the OCC’s proposed rule: 1) that the OCC inappropriately broadened the key language of Dodd-Frank’s preemption standard to encompass Barnett Bank, 2) that although the proposed rule eliminates the OCC’s current preemption standard, the rule asserts that preemption determinations based on that eliminated standard would continue to be valid, and 3) that the proposed rule could be read to preempt categories of state laws, even though the provisions of Dodd-Frank require that preemption determinations be made on a case-by-case basis.
In its final rule, the OCC acknowledged and responded to these concerns, but concluded that the proper interpretation of the preemption provision of Dodd-Frank preserves the Barnett Bank conflict preemption standard.
Editor's note: This article was co-written by Priscilla Taylor, a summer law clerk in the Firm's San Francisco office.
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