--- kind: "section" citation: "16 U.S.C. § 824c" title: "16" title_heading: "Conservation" number: "824c" heading: "Issuance of securities; assumption of liabilities" release: "119-102" date: "2026-07-12" url: "https://uscodex.org/usc/16/824c" units: - "Chapter 12 — Federal Regulation and Development of Power" - "Subchapter II — Regulation of Electric Utility Companies Engaged in Interstate Commerce" --- # §824c. Issuance of securities; assumption of liabilities - (a) **Authorization by Commission—** No public utility shall issue any [security](/usc/16/796.md?p=16), or assume any obligation or liability as guarantor, indorser, surety, or otherwise in respect of any [security](/usc/16/796.md?p=16) of another [person](/usc/16/796.md?p=4), unless and until, and then only to the extent that, upon application by the public utility, the [Commission](/usc/16/544.md?p=c) by order authorizes such issue or assumption of liability. The [Commission](/usc/16/544.md?p=c) shall make such order only if it finds that such issue or assumption (a) is for some lawful object, within the corporate purposes of the applicant and compatible with the public interest, which is necessary or appropriate for or consistent with the proper performance by the applicant of service as a public utility and which will not impair its ability to perform that service, and (b) is reasonably necessary or appropriate for such purposes. The provisions of this section shall be effective six months after August 26, 1935. - (b) **Application approval or modification; supplemental orders—** The [Commission](/usc/16/544.md?p=c), after opportunity for hearing, may grant any application under this section in whole or in part, and with such modifications and upon such terms and conditions as it may find necessary or appropriate, and may from time to time, after opportunity for hearing and for good cause shown, make such supplemental orders in the premises as it may find necessary or appropriate, and may by any such supplemental order modify the provisions of any previous order as to the particular purposes, uses, and extent to which, or the conditions under which, any [security](/usc/16/796.md?p=16) so theretofore authorized or the proceeds thereof may be applied, subject always to the requirements of [subsection (a)](#a) of this section. - (c) **Compliance with order of Commission—** No public utility shall, without the consent of the [Commission](/usc/16/544.md?p=c), apply any [security](/usc/16/796.md?p=16) or any proceeds thereof to any purpose not specified in the [Commission](/usc/16/544.md?p=c)’s order, or supplemental order, or to any purpose in excess of the amount allowed for such purpose in such order, or otherwise in contravention of such order. - (d) **Authorization of capitalization not to exceed amount paid—** The [Commission](/usc/16/544.md?p=c) shall not authorize the capitalization of the right to be a [corporation](/usc/16/796.md?p=3) or of any franchise, permit, or contract for consolidation, merger, or lease in excess of the amount (exclusive of any tax or annual charge) actually paid as the consideration for such right, franchise, permit, or contract. - (e) **Notes or drafts maturing less than one year after issuance—** [Subsection (a)](#a) shall not apply to the issue or renewal of, or assumption of liability on, a note or draft maturing not more than one year after the date of such issue, renewal, or assumption of liability, and aggregating (together with all other then outstanding notes and drafts of a maturity of one year or less on which such public utility is primarily or secondarily liable) not more than 5 per centum of the par value of the other [securities](/usc/16/796.md?p=16) of the public utility then outstanding. In the case of [securities](/usc/16/796.md?p=16) having no par value, the par value for the purpose of this subsection shall be the fair market value as of the date of issue. Within ten days after any such issue, renewal, or assumption of liability, the public utility shall file with the [Commission](/usc/16/544.md?p=c) a certificate of notification, in such form as may be prescribed by the [Commission](/usc/16/544.md?p=c), setting forth such matters as the [Commission](/usc/16/544.md?p=c) shall by regulation require. - (f) **Public utility securities regulated by State not affected—** The provisions of this section shall not extend to a public utility organized and operating in a [State](/usc/16/796.md?p=6) under the laws of which its [security](/usc/16/796.md?p=16) issues are regulated by a [State commission](/usc/16/796.md?p=15). - (g) **Guarantee or obligation on part of United States—** Nothing in this section shall be construed to imply any guarantee or obligation on the part of the United States in respect of any [securities](/usc/16/796.md?p=16) to which the provisions of this section relate. - (h) **Filing duplicate reports with the Securities and Exchange Commission—** Any public utility whose [security](/usc/16/796.md?p=16) issues are approved by the [Commission](/usc/16/544.md?p=c) under this section may file with the [Securities](/usc/16/796.md?p=16) and Exchange [Commission](/usc/16/544.md?p=c) duplicate copies of reports filed with the Federal Power [Commission](/usc/16/544.md?p=c) in lieu of the reports, information, and documents required under sections 77g, 78l, and 78m of title 15. ## Source credit (June 10, 1920, ch. 285, pt. II, § 204, as added Aug. 26, 1935, ch. 687, title II, § 213, 49 Stat. 850.) ## Notes ### Executive Documents ### Transfer of Functions Executive and administrative functions of Securities and Exchange Commission, with certain exceptions, transferred to Chairman of such Commission, with authority vested in him to authorize their performance by any officer, employee, or administrative unit under his jurisdiction, by Reorg. Plan No. 10 of 1950, §§ 1, 2, eff. May 24, 1950, 15 F.R. 3175, 64 Stat. 1265, set out in the Appendix to Title 5, Government Organization and Employees.