Rulemaking Process
THE RULEMAKING PROCESS
The Board of Directors provides general oversight of the Rules & Operations Committee, provides input, and is kept apprised of issue development. The Committee has an increased role in providing strategic direction for the Rule Making Process, categorizing rules proposals and determining time frame for development, identifying participants for groups, and selecting proposal sponsors.
- Rules proposals are categorized as follows: (A) Major impact to Network; (B) Moderate impact to Network; and (C) Minor impact to Network. Depending on the category of the rule, the issue is considered using one of three specific processes.
- Only members and key parties are able to submit rules proposals. Other parties wishing to submit an issue need to work with a member or key party to have that member or key party sponsor the issue.
- The process is streamlined for issues with a minor impact to the industry (i.e., some issues will not be distributed as a Request For Comment).
THE PROCESS
Initial Submission
Issues are presented by a member or key party to NACHA staff as a rules proposal. The issue is presented as a 1-2 page initial business case which describes the proposal and meets certain submission requirements. Members are Regional Payments Associations and their financial institution members, and Direct Financial Institution members of NACHA. Key parties are the ACH Operators, the U.S. Department of Treasury, Federal regulatory agencies, and the NACHA Board of Directors and Standing Committees. Any other party wishing to submit an issue will need to work with one of those members or key parties noted above and have that member or key party sponsor the issue.
Rules & Operations Committee Review
The Rules & Operations Committee will consider the issue to ensure that it is consistent with NACHA's strategic plan and appropriate for the Network. The Committee will either: 1) accept the proposal for review under the Rule Making Process, 2) request additional information from the submitter, or 3) reject the proposal. If the Rules & Operations Committee accepts the proposal, the Committee will:
- Evaluate the issue to determine which of three categories of rule changes the proposal would fall under: (A) Major impact to Network; (B) Moderate impact to Network; or (C) Minor impact to Network. Depending on the category of rule, the Rules & Operations Committee will forward the issue to be considered under one of three specific processes.
- Determine the estimated time needed to develop the proposal.
- If the proposal would cause a major or moderate impact to the Network, then the Committee will identify a financial institution or RPA sponsor.
Categories of Rules Proposals
Category A changes would have a major impact on ACH participants. Types of Category A changes include: (1) new products; (2) new services; and (3) major modifications to current Rules. The business case for Category A proposals include an increased level of detail in the economic analysis and a balanced articulation of divergent viewpoints.
Category B changes would have a moderate impact on ACH participants. Types of Category B changes include: (1) regulatory changes; (2) modifications to address marketplace changes; (3) emergency changes and Board-driven directives; and (4) moderate modifications. The business case for Category B proposals do not include the level of detail in the economic analysis that is included with Category A changes.
Category C changes would have a minor impact on ACH participants. They should have no significant economic impact. Types of Category C changes will include: (1) editorial changes to address corrections in grammar, spelling, and similar errors; (2) changes to correct inconsistencies between various rules; (3) changes to rules with the purpose of clarifying intent; (4) minor modification to incorporate current practices (e.g., Operator edits, return code descriptions), and (5) changes that may involve minor software modifications. There will not be a need for a full business case or Request For Comment (RFC) because there would not be a significant impact to the Network participants.
