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Federal Register / Vol. 86, No. 234 / Thursday, December 9, 2021 / Rules and Regulations alternatives for small entities are required or appropriate.
V. Other Matters Pursuant to the Congressional Review Act 5 U.S.C. 801 et seq., the Office of Information and Regulatory Affairs designated this rule as not a major rule, as defined by 5 U.S.C. 8042.
List of Subjects in 16 CFR Part 313
Consumer protection, Credit, Data protection, Privacy, Trade practices.
For the reasons stated above, the Federal Trade Commission amends 16
CFR part 313 as follows:
PART 313PRIVACY OF CONSUMER
FINANCIAL INFORMATION
1. The authority citation for part 313
is revised to read as follows:

Authority: 15 U.S.C. 6801 et seq., 12
U.S.C. 5519.

2. Amend 313.1 by revising paragraph b to read as follows:

313.1

Purpose and scope.

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b Scope. This part applies only to nonpublic personal information about individuals who obtain financial products or services primarily for personal, family or household purposes from the institutions listed below. This part does not apply to information about companies or about individuals who obtain financial products or services for business, commercial, or agricultural purposes. This part applies to those financial institutions over which the Federal Trade Commission Commission has rulemaking authority pursuant to section 504a1C of the Gramm-Leach-Bliley Act. An entity is a financial institution if its business is engaging in an activity that is financial in nature or incidental to such financial activities as described in section 4k of the Bank Holding Company Act of 1956, 12
U.S.C. 1843k, which incorporates activities enumerated by the Federal Reserve Board in 12 CFR 225.28 and 225.86. The financial institutions subject to the Commissions rulemaking authority are any persons described in 12 U.S.C. 5519 that are predominantly engaged in the sale and servicing of motor vehicles, the leasing and servicing of motor vehicles, or both.
They are referred to in this part as You. Excluded from the coverage of this part are motor vehicle dealers described in 12 U.S.C. 5519b that directly extend to consumers retail credit or retail leases involving motor vehicles in which the contract governing such extension of retail credit
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or retail leases is not routinely assigned to an unaffiliated third party finance or leasing source.
3. Amend 313.3 by revising paragraphs e, i, j, k, and q to read as follows:
313.3

Definitions.

e1 Consumer means an individual who obtains or has obtained a financial product or service from you that is to be used primarily for personal, family, or household purposes, or that individuals legal representative.
2 For example:
i An individual who applies to you for credit for personal, family, or household purposes is a consumer of a financial service, regardless of whether the credit is extended.
ii An individual who provides nonpublic personal information to you in order to obtain a determination about whether he or she may qualify for a loan to be used primarily for personal, family, or household purposes is a consumer of a financial service, regardless of whether the loan is extended.
iii If you hold ownership or servicing rights to an individuals loan that is used primarily for personal, family, or household purposes, the individual is your consumer, even if you hold those rights in conjunction with one or more other institutions.
The individual is also a consumer with respect to the other financial institutions involved. An individual who has a loan in which you have ownership or servicing rights is your consumer, even if you, or another institution with those rights, hire an agent to collect on the loan.
iv An individual who is a consumer of another financial institution is not your consumer solely because you act as agent for, or provide processing or other services to, that financial institution.
v An individual is not your consumer solely because he or she is a participant or a beneficiary of an employee benefit plan that you sponsor or for which you act as a trustee or fiduciary.

i1 Customer relationship means a continuing relationship between a consumer and you under which you provide one or more financial products or services to the consumer that are to be used primarily for personal, family, or household purposes.
2 For example:
i Continuing relationship. A
consumer has a continuing relationship with you if the consumer:

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A Has a credit or investment account with you;
B Obtains a loan from you;
C Purchases an insurance product from you;
D Enters into an agreement or understanding with you whereby you undertake to arrange or broker a home mortgage loan, or credit to purchase a vehicle, for the consumer;
E Enters into a lease of personal property on a non-operating basis with you; or F Has a loan for which you own the servicing rights.
ii No continuing relationship. A
consumer does not, however, have a continuing relationship with you if:
A The consumer obtains a financial product or service from you only in isolated transactions, such as cashing a check with you or making a wire transfer through you;
B You sell the consumers loan and do not retain the rights to service that loan; or C The consumer obtains one-time personal appraisal services from you.
j Federal functional regulator means:
1 The Board of Governors of the Federal Reserve System;
2 The Office of the Comptroller of the Currency;
3 The Board of Directors of the Federal Deposit Insurance Corporation;
4 The National Credit Union Administration Board; and 5 The Securities and Exchange Commission.
k1 Financial institution means any institution the business of which is engaging in an activity that is financial in nature or incidental to such financial activities as described in section 4k of the Bank Holding Company Act of 1956, 12 U.S.C. 1843k. An institution that is significantly engaged in financial activities, or significantly engaged in activities incidental to such financial activities, is a financial institution.
2 An example of a financial institution is an automobile dealership that, as a usual part of its business, leases automobiles on a nonoperating basis for longer than 90 days is a financial institution with respect to its leasing business because leasing personal property on a nonoperating basis where the initial term of the lease is at least 90 days is a financial activity listed in 12 CFR 225.28b3 and referenced in section 4k4F of the Bank Holding Company Act.
3 Financial institution does not include entities that engage in financial activities but that are not significantly engaged in those financial activities.
4 An example of entities that are not significantly engaged in financial
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