Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committees on Consumer Protection & Commerce and Judiciary, to which was referred H.B. No. 634 entitled:

beg leave to report as follows:

The purpose of this bill is to update, modernize, and better conform Hawaii's securities law to federal securities law by replacing chapter 485, Hawaii Revised Statutes, with a new Uniform Securities Act based on the National Conference of Commissioners on Uniform State Laws (NCCUSL) 2002 Uniform Securities Act.

The Hawaii Commission to Promote Uniform Legislation and a member of the Business Law Section of the Hawaii Bar Association testified in support of this bill. Testimony in support of this bill with amendments was received from the Department of Commerce and Consumer Affairs Commissioner of Securities. The American Council of Life Insurers and the Hawaii Bankers Association testified in opposition to the bill. The Office of Information Practices and Securities Industry Association commented.

Your Committees find that Hawaii's present Uniform Securities Act is based on the Securities Act of 1956. Since that time, most states have amended their securities laws, creating a patchwork of differing requirements that makes interstate transactions in securities complex, costly, and difficult. As a result, NCCUSL developed a modern uniform act addressing these developments, that was also drafted to conform with modern federal securities laws. The result is the 2002 Uniform Securities Act on which this bill is based.

Your Committees have amended this bill by:

As affirmed by the records of votes of the members of your Committees on Consumer Protection & Commerce and Judiciary that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 634, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 634, H.D. 1, and be referred to the Committee on Finance.