Proposed Rule2026-03758
Statutory Liens
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
February 25, 2026
Issuing agencies
National Credit Union Administration
Abstract
The NCUA Board (Board) is publishing this proposed rule to remove a provision of NCUA regulations regarding federal credit unions' (FCUs) statutory lien authority. The Board believes it is redundant to continue to include a definition of the term "except as otherwise provided by law or except as otherwise provided by federal law" when it is axiomatic that a law that supersedes this regulation would be controlling. The provision does not provide any assistance to FCUs in determining whether such statutory or case law exists, therefore it has no material value.
Full Text
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<title>Federal Register, Volume 91 Issue 37 (Wednesday, February 25, 2026)</title>
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[Federal Register Volume 91, Number 37 (Wednesday, February 25, 2026)]
[Proposed Rules]
[Pages 9181-9182]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-03758]
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NATIONAL CREDIT UNION ADMINISTRATION
12 CFR Part 701
RIN 3133-AF86
Statutory Liens
AGENCY: National Credit Union Administration (NCUA).
ACTION: Proposed rule.
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SUMMARY: The NCUA Board (Board) is publishing this proposed rule to
remove a provision of NCUA regulations regarding federal credit unions'
(FCUs) statutory lien authority. The Board believes it is redundant to
continue to include a definition of the term ``except as otherwise
provided by law or except as otherwise provided by federal law'' when
it is axiomatic that a law that supersedes this regulation would be
controlling. The provision does not provide any assistance to FCUs in
determining whether such statutory or case law exists, therefore it has
no material value.
DATES: Comments must be received on or before April 27, 2026.
ADDRESSES: You may submit written comments by any of the following
methods identified by RIN (Please send comments by one method only):
<bullet> Federal eRulemaking Portal: <a href="https://www.regulations.gov">https://www.regulations.gov</a>.
Follow the instructions for submitting comments for Docket Number NCUA-
2026-0435.
<bullet> Mail: Address to Melane Conyers-Ausbrooks, Secretary of
the Board, National Credit Union Administration, 1775 Duke Street,
Alexandria, Virginia 22314-3428.
<bullet> Hand Delivery/Courier: Same as mail address.
Mailed and hand-delivered comments must be received by the close of
the comment period.
Public Inspection: All public comments are available on the Federal
eRulemaking Portal at <a href="https://www.regulations.gov">https://www.regulations.gov</a> as submitted, except
when impossible for technical reasons. Public comments will not be
edited to remove any identifying or contact information. If you are
unable to access public comments on the internet, you may contact the
NCUA for alternative access by calling (703) 518-6540 or emailing
<a href="/cdn-cgi/l/email-protection#18575f5b5579717458767b6d79367f776e"><span class="__cf_email__" data-cfemail="bcf3fbfff1ddd5d0fcd2dfc9dd92dbd3ca">[email protected]</span></a>.
FOR FURTHER INFORMATION CONTACT: Gira Bose, Senior Staff Attorney,
Office of General Counsel, at (703) 518-6540 or at 1775 Duke Street,
Alexandria, VA 22314.
SUPPLEMENTARY INFORMATION:
I. Introduction
A. Background
Section 701.39 of the NCUA's regulations implements the statutory
lien authority granted to FCUs under the Federal Credit Union Act (FCU
Act).\1\ The regulation, which converted a prior policy statement into
a regulation in 1999, states that an FCU has the power to impress and
enforce a lien against a member's shares and dividends to satisfy any
outstanding financial obligation owed to the credit union.\2\
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\1\ 12 U.S.C. 1757(11).
\2\ 64 FR 56956 (Oct. 22, 1999).
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This proposed rule would amend the regulation by removing the
definition of the term ``[e]xcept as otherwise provided by law or
except as otherwise provided by federal law.'' \3\
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\3\ 12 CFR 701.39(a)(1).
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Section 701.39(a)(1) signals the possible existence of superseding
federal and/or state law requirements and alerts credit unions of their
responsibility to ``ascertain whether such statutory or case law exists
and is applicable.'' \4\
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\4\ Id.
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The history of Sec. 701.39 shows that, as originally proposed in
1998, the regulation contained an express provision that would have
preempted state laws governing the right of a creditor to impress and
enforce a lien, as well as the common law right of set-off. Commenters
countered that the proposed language was overbroad, sweeping within its
ambit state laws that may benefit credit unions and on which they
should be free to rely.\5\ Commenters suggested that the final rule
specify which state laws it preempts and which ones it does not
preempt. The agency did not take up that suggestion but, as a
compromise and to eliminate ambiguity, the final rule deleted the
blanket preemption provision. In its place, the agency adopted the
qualifying language, ``except as otherwise provided by law or except as
otherwise provided by federal law.''
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\5\ 64 FR 56956 (Oct. 22, 1999).
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B. Legal Authority
Under the FCU Act, the NCUA is the chartering and supervisory
authority for FCUs and the federal supervisory authority for federally
insured credit unions. The FCU Act grants the NCUA a broad mandate to
issue regulations governing both FCUs and federally insured credit
unions. Section 120 of the FCU Act is a general grant of regulatory
authority, and it authorizes the Board to prescribe rules and
regulations for the administration of the FCU Act. Accordingly, the FCU
Act grants the Board broad rulemaking authority to ensure the credit
union industry and the Share Insurance Fund remain safe and sound.
II. Proposed Rule
In reconsidering the regulation, the Board believes that this
definition is not helpful. The fact that an FCU must determine which
laws apply to its operations and must be aware that some legal
requirements supersede others, is a universal consideration and not one
that is specific to this regulation. Thus, the Board proposes to repeal
paragraph 701.39(a)(1).
The Board invites feedback on its proposal to repeal paragraph
701.39(a)(1), including whether commenters believe that the provision
is helpful and should be retained.
III. Regulatory Procedures
A. Providing Accountability Through Transparency Act of 2023
The Providing Accountability Through Transparency Act of 2023 (5
U.S.C. 553(b)(4)) requires that a notice of proposed rulemaking include
the internet address of a summary of not more than 100 words in length
of a proposed rule, in plain language, that shall be posted on the
internet website under section 206(d) of the E-Government Act of 2002
(44 U.S.C. 3501 note) (commonly known as <a href="http://regulations.gov">regulations.gov</a>).
In summary, the Board is publishing this proposed rule to remove a
paragraph from section 701.39 regarding FCUs' statutory lien authority.
The Board believes it is redundant to continue to include a definition
of the term ``except as otherwise provided by law or except as
otherwise provided by federal law,'' when it is accepted that, when a
law that supersedes a regulation would be controlling. The provision
does not provide any assistance to FCUs in determining whether such
statutory or caselaw exists, therefore it has no material value.
The proposal and the required summary can be found at <a href="https://www.regulations.gov">https://www.regulations.gov</a>.
B. Executive Orders 12866, 13563, and 14192
Pursuant to Executive Order 12866 (``Regulatory Planning and
Review''), as amended by Executive Order 14215, a determination must be
made whether a
[[Page 9182]]
regulatory action is significant and therefore subject to review by the
Office of Management and Budget (OMB) in accordance with the
requirements of the executive order. OMB has determined that this
proposed rule is not a ``significant regulatory action'' as defined in
section 3(f)(1) of Executive Order 12866. Executive Order 13563
(``Improving Regulations and Regulatory Review'') directs executive
agencies to analyze regulations that are ``outmoded, ineffective,
insufficient, or excessively burdensome, and to modify, streamline,
expand, or repeal them in accordance with what has been learned.''
Executive Order 13563 also directs that, where relevant, feasible, and
consistent with regulatory objectives, and to the extent permitted by
law, agencies are to identify and consider regulatory approaches that
reduce burdens and maintain flexibility and freedom of choice for the
public. The proposed rule eliminates a nonsubstantive reference in
Sec. 701.39 regarding statutory lien authority. This proposed rule is
consistent with Executive Order 13563.
Executive Order 14192, entitled ``Unleashing Prosperity Through
Deregulation,'' was issued on January 31, 2025. Section 3(c) of
Executive Order 14192 requires that any new incremental costs
associated with new regulations shall, to the extent permitted by law,
be offset by the elimination of existing costs associated with at least
10 prior regulations. This proposed rule is expected to be a
deregulatory action for purposes of Executive Order 14192.
C. The Regulatory Flexibility Act
The Regulatory Flexibility Act generally requires an agency to
conduct a regulatory flexibility analysis of any rule subject to notice
and comment rulemaking requirements, unless the agency certifies that
the rule will not have a significant economic impact on a substantial
number of small entities.\6\ If the agency makes such a certification,
it shall publish the certification at the time of publication of either
the proposed rule or the final rule, along with a statement providing
the factual basis for such certification.\7\ For purposes of this
analysis, the NCUA considers small credit unions to be those having
under $100 million in assets.\8\ The Board fully considered the
potential economic impacts of the regulatory amendment on small credit
unions.
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\6\ 5 U.S.C. 601 et seq.
\7\ 5 U.S.C. 605(b).
\8\ 80 FR 57512 (Sept. 24, 2015).
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The proposed rule eliminates a nonsubstantive reference in Sec.
701.39 regarding statutory liens. Accordingly, the NCUA certifies the
proposed rule would not have a significant economic impact on a
substantial number of small credit unions.
D. The Paperwork Reduction Act
The Paperwork Reduction Act of 1995 (PRA) generally provides that
an agency may not conduct or sponsor, and not withstanding any other
provision of law, a person is not required to respond to, a collection
of information, unless it displays a currently valid OMB control
number. The PRA applies to rulemakings in which an agency creates a new
or amends existing information collection requirements. For purposes of
the PRA, an information-collection requirement may take the form of a
reporting, recordkeeping, or a third-party disclosure requirement. The
NCUA has determined that the change in the proposed rule does not
create a new information collection or revise an existing information
collection as defined by the PRA.
E. Analysis on Executive Order 13132 on Federalism
Executive Order 13132 encourages certain regulatory agencies to
consider the impact of their actions on state and local interests. The
NCUA, an agency as defined in 44 U.S.C. 3502(5), complies with the
executive order to adhere to fundamental federalism principles. This
proposed rule is intended to eliminate an unnecessary reference without
making any substantive change. The regulation applies only to FCUs.
Thus, it is not intended to affect the division of responsibilities
between the NCUA and state regulatory authorities with oversight of
federally insured, state-chartered credit unions.
F. Assessment of Federal Regulations and Policies on Families
The NCUA has determined that this proposed rule would not affect
family well-being within the meaning of section 654 of the Treasury and
General Government Appropriations Act, 1999. The proposed rule amends
the regulation regarding an FCU's authority to impose a statutory lien
on a member but makes no substantive change; thus, this proposed rule
is not expected to have any effect on family well-being.
List of Subjects in 12 CFR Part 701
Advertising, Aged, Civil rights, Credit, Credit unions, Fair
housing, Individuals with disabilities, Insurance, Marital status
discrimination, Mortgages, Religious discrimination, Reporting and
recordkeeping requirements, Sex discrimination, Signs and symbols,
Surety bonds.
By the National Credit Union Administration Board, this 20th day
of February, 2026.
Melane Conyers-Ausbrooks,
Secretary of the Board.
For the reasons stated in the preamble, the Board proposes to amend
12 CFR part 701, as follows:
PART 701--ORGANIZATION AND OPERATION OF FEDERAL CREDIT UNIONS
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1. The authority citation for part 701 continues to read as follows:
Authority: 12 U.S.C. 1752(5), 1755, 1756, 1757, 1758, 1759,
1761a, 1761b, 1766, 1767, 1782, 1784, 1785, 1786, 1787, 1788, 1789.
Section 701.6 is also authorized by 15 U.S.C. 3717. Section 701.31
is also authorized by 15 U.S.C. 1601 et seq.; 42 U.S.C. 1981 and
3601-3610. Section 701.35 is also authorized by 42 U.S.C. 4311-4312.
Sec. 701.39 [Amended]
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2. Amend Sec. 701.39 by removing paragraph (a)(1) and redesignating
paragraphs (a)(2) through (5) as paragraphs (a)(1) through (4).
[FR Doc. 2026-03758 Filed 2-24-26; 8:45 am]
BILLING CODE 7535-01-P
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</html>Indexed from Federal Register on February 25, 2026.
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