---
kind: "section"
citation: "12 U.S.C. § 2279aa–12"
title: "12"
title_heading: "Banks and Banking"
number: "2279aa–12"
heading: "Securities in credit enhanced pools"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/12/2279aa-12"
units:
  - "Chapter 23 — Farm Credit System"
  - "Subchapter VIII — Agricultural Mortgage Secondary Market"
  - "Part A — Establishment and Activities of Federal Agricultural Mortgage Corporation"
---

# §2279aa–12. Securities in credit enhanced pools

- (a) **Federal laws—**
  - (1) **Applicability of certain Federal securities laws—** For purposes of [section 77c(a)(2) of title 15](/usc/15/77c.md?p=a-2), no security representing an interest in, or obligations backed by, a pool of [qualified loans](/usc/12/2279aa.md?p=7) for which [guarantees](/usc/12/2279aa.md?p=5) have been provided by the [Corporation](/usc/12/2279aa.md?p=4) shall be deemed to be a security issued or guaranteed by a [person](/usc/12/5481.md?p=19) controlled or supervised by, or acting as an instrumentality of, the Government of the United States. No such security shall be deemed to be a “government security” for purposes of the Securities Exchange Act of 1934 [[15 U.S.C. 78a](/usc/15/78a.md) et seq.] or for purposes of the Investment Company Act of 1940 [[15 U.S.C. 80a–1](/usc/15/80a–1.md) et seq.].
  - (2) **No full faith and credit of the United States—** Each security for which [credit](/usc/12/5481.md?p=7) enhancement has been provided by the [Corporation](/usc/12/2279aa.md?p=4) shall clearly indicate that the security is not an obligation of, and is not guaranteed as to principal or interest by, the Farm [Credit](/usc/12/5481.md?p=7) Administration, the United States, or any other agency or instrumentality of the United States (other than the [Corporation](/usc/12/2279aa.md?p=4)).
- (b) **State securities laws—**
  - (1) **General exemption—** Any security or obligation that has been provided a [guarantee](/usc/12/2279aa.md?p=5) by the [Corporation](/usc/12/2279aa.md?p=4) shall be exempt from any law of any [State](/usc/12/2279aa.md?p=8) with respect to or requiring registration or qualification of securities or [real estate](/usc/12/1707.md?p=g) to the same extent as any obligation issued by, or guaranteed as to principal and interest by, the United States or any agency or instrumentality of the United States.
  - (2) **State override—** The provisions of [paragraph (1)](#b-1) shall not be applicable to any [State](/usc/12/2279aa.md?p=8) that, during the 8-year period beginning on January 6, 1988, enacts a law that—
    - (A) specifically refers to this subsection; and
    - (B) expressly provides that [paragraph (1)](#b-1) shall not apply to the [State](/usc/12/2279aa.md?p=8).
- (c) **Authorized investments—**
  - (1) **In general—** Securities representing an interest in, or obligations backed by, pools of [qualified loans](/usc/12/2279aa.md?p=7) with respect to which the [Corporation](/usc/12/2279aa.md?p=4) has provided a [guarantee](/usc/12/2279aa.md?p=5) shall be authorized investments of any [person](/usc/12/5481.md?p=19), trust, [corporation](/usc/12/2279aa.md?p=4), partnership, association, business trust, or business entity created pursuant to or existing under the laws of the United States or any [State](/usc/12/2279aa.md?p=8) to the same extent that the [person](/usc/12/5481.md?p=19), trust, [corporation](/usc/12/2279aa.md?p=4), partnership, association, business trust, or business entity is authorized under any applicable law to purchase, hold, or [invest](/usc/12/1861.md?p=b-6) in obligations issued by or guaranteed as to principal and interest by the United States or any agency or instrumentality of the United States. Such securities or obligations may be accepted as security for all fiduciary, trust, and public funds, the investment or deposits of which shall be under the authority and control of the United States or any [State](/usc/12/2279aa.md?p=8) or any officers of either.
  - (2) **State limitations on purchase, holding, or investment—** If [State](/usc/12/2279aa.md?p=8) law limits the purchase, holding, or investment in obligations issued by the United States by the [person](/usc/12/5481.md?p=19), trust, [corporation](/usc/12/2279aa.md?p=4), partnership, association, business trust, or business entity, securities or obligations of a [certified facility](/usc/12/2279aa.md?p=3) issued on which the [Corporation](/usc/12/2279aa.md?p=4) has provided a [guarantee](/usc/12/2279aa.md?p=5) shall be considered to be obligations issued by the United States for purposes of the limitation.
  - (3) **Nonapplicability of provisions—**
    - (A) **Subsequent State law—** Paragraphs [(1)](#c-1) and [(2)](#c-2) shall not apply with respect to a particular [person](/usc/12/5481.md?p=19), trust, [corporation](/usc/12/2279aa.md?p=4), partnership, association, business trust, or business entity, or class thereof, in any [State](/usc/12/2279aa.md?p=8) that, prior to the expiration of the 8-year period beginning on January 6, 1988, enacts a law that specifically refers to this section and either prohibits or provides for a more limited authority to purchase, hold, or [invest](/usc/12/1861.md?p=b-6) in the securities by any [person](/usc/12/5481.md?p=19), trust, [corporation](/usc/12/2279aa.md?p=4), partnership, association, business trust, or business entity, or class thereof, than is provided in paragraphs [(1)](#c-1) and [(2)](#c-2).
    - (B) **Effect of subsequent State law—** The enactment by any [State](/usc/12/2279aa.md?p=8) of a law of the type described in [subparagraph (A)](#c-3-A) shall not affect the validity of any contractual commitment to purchase, hold, or [invest](/usc/12/1861.md?p=b-6) that was made prior to the effective date of the law and shall not require the sale or other disposition of any securities acquired prior to the effective date of the law.
- (d) **State usury laws superseded—** A provision of the Constitution or law of any [State](/usc/12/2279aa.md?p=8) shall not apply to an agricultural loan made by an [originator](/usc/12/2279aa.md?p=6) or a [certified facility](/usc/12/2279aa.md?p=3) in accordance with this subchapter for sale to the [Corporation](/usc/12/2279aa.md?p=4) or to a [certified facility](/usc/12/2279aa.md?p=3) for inclusion in a pool for which the [Corporation](/usc/12/2279aa.md?p=4) has provided, or has committed to provide, a [guarantee](/usc/12/2279aa.md?p=5), if the loan, not later than 180 days after the date the loan was made, is sold to the [Corporation](/usc/12/2279aa.md?p=4) or included in a pool for which the [Corporation](/usc/12/2279aa.md?p=4) has provided a [guarantee](/usc/12/2279aa.md?p=5), if the provision—
  - (1) limits the rate or amount of interest, discount points, finance charges, or other charges that may be charged, taken, received, or reserved by an agricultural lender or a [certified facility](/usc/12/2279aa.md?p=3); or
  - (2) limits or prohibits a prepayment penalty (either fixed or declining), yield maintenance, or make-whole payment that may be charged, taken, or received by an agricultural lender or a [certified facility](/usc/12/2279aa.md?p=3) in connection with the full or partial payment of the principal amount due on a loan by a borrower in advance of the scheduled date for the payment under the terms of the loan, otherwise known as a prepayment of the loan principal.

## Source credit

(Pub. L. 92–181, title VIII, § 8.12, as added Pub. L. 100–233, title VII, § 702, Jan. 6, 1988, 101 Stat. 1703; amended Pub. L. 100–399, title VI, § 601(k), (l), Aug. 17, 1988, 102 Stat. 1006; Pub. L. 104–105, title I, § 112, Feb. 10, 1996, 110 Stat. 165.)

## Notes

### Editorial Notes

### References in Text

The Securities Exchange Act of 1934, referred to in subsec. (a)(1), is act June 6, 1934, ch. 404, 48 Stat. 881, which is classified principally to chapter 2B (§ 78a et seq.) of Title 15, Commerce and Trade. For complete classification of this Act to the Code, see section 78a of Title 15 and Tables.

The Investment Company Act of 1940, referred to in subsec. (a)(1), is title I of act Aug. 22, 1940, ch. 686, 54 Stat. 789, which is classified generally to subchapter I (§ 80a–1 et seq.) of chapter 2D of Title 15. For complete classification of this Act to the Code, see section 80a–51 of Title 15 and Tables.

### Amendments

1996—Subsec. (d). Pub. L. 104–105 added subsec. (d) and struck out heading and text of former subsec. (d). Text read as follows: “Any provision of the constitution or law of any State which expressly limits the rate or amount of interest, discount points, finance charges, or other charges that may be charged, taken, received, or reserved by agricultural lenders or certified facilities shall not apply to any agricultural loan made by an originator or a certified facility in accordance with this subchapter that is included in a pool for which the Corporation has provided a guarantee.”

1988—Subsec. (a)(1). Pub. L. 100–399, § 601(k), inserted “, or obligations backed by,” before “a pool”.

Subsec. (b)(2). Pub. L. 100–399, § 601(l), substituted “date of the enactment” for “effective date” both of which for purposes of codification was translated as “January 6, 1988,”.

### Statutory Notes and Related Subsidiaries

### Effective Date of 1988 Amendment

Amendment by Pub. L. 100–399 effective as if enacted immediately after enactment of Pub. L. 100–233, which was approved Jan. 6, 1988, see section 1001(a) of Pub. L. 100–399, set out as a note under section 2002 of this title.