Benefit Corp Special Entities

Examples Banks (Holding Companies, State Chartered, Federally Chartered) Mutual Companies Agricultural COOPs Other Special Entities

Banks and Benefit Corp Holding company vs. regulated entity? Regulator (state vs. federal)? State banking statute?

Holding Companies Regulated by the Federal Reserve 2 holding companies have converted No pushback from Federal Reserve on conversion Legal commitment at holding company level is best practice for B Corp Certification

State Chartered Bank Regulated by in-state regulators and FDIC/Federal Reserve Two potential issues: Mechanics of banking statute State regulator approval Virginia Community Capital (VCC) made the conversion in 2016 VCC obtained approval from both their in-state regulator and their corporations commission and presented to the Federal Reserve as a courtesy

Federally Chartered Bank Regulated by the Office of the Comptroller of the Currency (OCC) OCC informally expressed concerns about federally chartered banks becoming benefit corps In 2015, B Lab submitted formal testimony in the federal Economic Growth and Regulatory Paper Reduction Act of 1996 (EGRPRA) process and testified in person

Mutual Companies NE insurance company statute has a confusing relationship to the benefit corp statute Almost impossible for mutual companies to get the vote

Agricultural COOPs Regulated by the Capper–Volstead Act, which grants exemptions from antitrust laws specifically due to their singular purpose to produce, handle and market farm products Attorneys: any other purpose could put them at risk of losing antitrust status Not a uniform opinion, Oregon Cherry Growers

Other Special Entities Lots of other entities out there that fall under different statutes and thus can’t become benefit corporations Not always clear to us: best determined by in- state lawyer COOPS = NO PCs = ?

What we need Does the state statute allow different special entities to adopt benefit corp? Advocacy on legislative or regulatory or roadblocks