PRRADA

II 117TH CONGRESS 1ST SESSION S. 375 To impose requirements on the payment of compensation to professional persons employed in voluntary cases commenced under title III of the Puerto Rico Oversight Management and Economic Stability Act (com- monly known as ‘‘PROMESA’’). IN THE SENATE OF THE UNITED STATES FEBRUARY 23, 2021 Mr. MENENDEZ (for himself, Ms. HIRONO, Mr. BLUMENTHAL, Mr. RUBIO, and Ms. STABENOW) introduced the following bill; which was read twice and referred to the Committee on Energy and Natural Resources A BILL To impose requirements on the payment of compensation to professional persons employed in voluntary cases com- menced under title III of the Puerto Rico Oversight Management and Economic Stability Act (commonly known as ‘‘PROMESA’’). Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Puerto Rico Recovery 4 Accuracy in Disclosures Act of 2021’’ or ‘‘PRRADA’’. 5 VerDate Sep 11 2014 02:51 Mar 02, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S375.IS S375 kjohnson on DSK79L0C42PROD with BILLS 2 •S 375 IS SEC. 2. DISCLOSURE BY PROFESSIONAL PERSONS SEEKING 1 APPROVAL OF COMPENSATION UNDER SEC- 2 TION 316 OR 317 OF PROMESA. 3 (a) REQUIRED DISCLOSURE.— 4 (1) IN GENERAL.—In a voluntary case com- 5 menced under section 304 of PROMESA (48 U.S.C. 6 2164), no attorney, accountant, appraiser, auc- 7 tioneer, agent, consultant, or other professional per- 8 son may be compensated under section 316 or 317 9 of that Act (48 U.S.C. 2176, 2177) unless prior to 10 making a request for compensation, the professional 11 person has submitted a verified statement con- 12 forming to the disclosure requirements of rule 13 2014(a) of the Federal Rules of Bankruptcy Proce- 14 dure setting forth the connection of the professional 15 person with— 16 (A) the debtor; 17 (B) any creditor; 18 (C) any other party in interest, including 19 any attorney or accountant; 20 (D) the Financial Oversight and Manage- 21 ment Board established in accordance with sec- 22 tion 101 of PROMESA (48 U.S.C. 2121); and 23 (E) any person employed by the Oversight 24 Board described in subparagraph (D). 25 VerDate Sep 11 2014 02:51 Mar 02, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S375.IS S375 kjohnson on DSK79L0C42PROD with BILLS 3 •S 375 IS (2) OTHER REQUIREMENTS.—A professional 1 person that submits a statement under paragraph 2 (1) shall— 3 (A) supplement the statement with any ad- 4 ditional relevant information that becomes 5 known to the person; and 6 (B) file annually a notice confirming the 7 accuracy of the statement. 8 (b) REVIEW.— 9 (1) IN GENERAL.—The United States Trustee 10 shall review each verified statement submitted pur- 11 suant to subsection (a) and may file with the court 12 comments on such verified statements before the 13 professionals filing such statements seek compensa- 14 tion under section 316 or 317 of PROMESA (48 15 U.S.C. 2176, 2177). 16 (2) OBJECTION.—The United States Trustee 17 may object to compensation applications filed under 18 section 316 or 317 of PROMESA (48 U.S.C. 2176, 19 2177) that fail to satisfy the requirements of sub- 20 section (e). 21 (3) RIGHT TO BE HEARD.—Each person de- 22 scribed in section 1109 of title 11, United States 23 Code, may appear and be heard on any issue in a 24 case under this section. 25 VerDate Sep 11 2014 02:51 Mar 02, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S375.IS S375 kjohnson on DSK79L0C42PROD with BILLS 4 •S 375 IS (c) JURISDICTION.—The district courts of the United 1 States shall have jurisdiction of all cases under this sec- 2 tion. 3 (d) RETROACTIVITY.— 4 (1) IN GENERAL.—If a court has entered an 5 order approving compensation under a case com- 6 menced under section 304 of PROMESA (48 U.S.C. 7 2164), each professional person subject to the order 8 shall file a verified statement in accordance with 9 subsection (a) not later than 60 days after the date 10 of enactment of this Act. 11 (2) NO DELAY.—A court may not delay any 12 proceeding in connection with a case commenced 13 under section 304 of PROMESA (48 U.S.C. 2164) 14 pending the filing of a verified statement under 15 paragraph (1). 16 (e) LIMITATION ON COMPENSATION.— 17 (1) IN GENERAL.—In a voluntary case com- 18 menced under section 304 of PROMESA (48 U.S.C. 19 2164), in connection with the review and approval of 20 professional compensation under section 316 or 317 21 of PROMESA (48 U.S.C. 2176, 2177), the court 22 may deny allowance of compensation for services and 23 reimbursement of expenses, accruing after the date 24 VerDate Sep 11 2014 02:51 Mar 02, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S375.IS S375 kjohnson on DSK79L0C42PROD with BILLS 5 •S 375 IS of the enactment of this Act of a professional person 1 if the professional person— 2 (A) has failed to file statements of connec- 3 tions required by subsection (a) or has filed in- 4 adequate statements of connections; 5 (B) except as provided in paragraph (3), is 6 on or after the date of enactment of this Act 7 not a disinterested person, as defined in section 8 101 of title 11, United States Code; or 9 (C) except as provided in paragraph (3), 10 represents, or holds an interest adverse to, the 11 interest of the estate with respect to the matter 12 on which such professional person is employed. 13 (2) CONSIDERATIONS.—In making a determina- 14 tion under paragraph (1), the court may take into 15 consideration whether the services and expenses are 16 in the best interests of creditors and the estate. 17 (3) COMMITTEE PROFESSIONAL STANDARDS.— 18 An attorney or accountant described in section 19 1103(b) of title 11, United States Code, shall be 20 deemed to have violated paragraph (1) if the attor- 21 ney or accountant violates section 1103(b) of title 22 11, United States Code. 23 Æ VerDate Sep 11 2014 02:51 Mar 02, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6301 E:\BILLS\S375.IS S375 kjohnson on DSK79L0C42PROD with BILLS