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Federal Reserve Board approves final amendments to simplify Regulation J and to make it conform more closely with Regulation CC

November 15, 2018

Federal Reserve Board approves final amendments to simplify Regulation J and to make it conform more closely with Regulation CC

For release at 4:00 p.m. EST

The Federal Reserve Board on Thursday approved final amendments to simplify Regulation J (Collection of Checks and Other Items by Federal Reserve Banks and Funds Transfers through Fedwire) and to make it conform more closely with Regulation CC (Availability of Funds and Collection of Checks).

The amendments align the rights and obligations of parties, including the Federal Reserve Banks, with the Board's 2017 amendments to Regulation CC, which reflected the evolution of the nation's check collection system from one that is largely paper-based to one that is virtually all electronic. The amendments also clarify and simplify provisions of Regulation J, remove obsolete provisions, and improve consistency between Regulation J and Regulation CC. Finally, the amendments clarify that electronically-created items (check-like items created in electronic form that never existed in paper form) are not "items" that the Reserve Banks are authorized to handle under Regulation J.

The Board has also amended Regulation J to clarify that financial messaging standards for Fedwire funds transfers, such as the international common format standard ISO 20022, do not confer or connote legal status or responsibilities with respect to Fedwire funds transfers.

The amendments become effective as of January 1, 2019. The Board's Federal Register notice is attached.

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