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HOUSE BILL 2427
By Williams
SENATE BILL 1813
By Bailey
SB1813
011477
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AN ACT to amend Tennessee Code Annotated, Title 9,
Chapter 4, relative to precious metals.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Section 9-4-801, is amended by deleting the
language "As used in this part" and substituting instead the language "As used in this section
and § 9-4-802".
SECTION 2. Tennessee Code Annotated, Title 9, Chapter 4, Part 8, is amended by
adding the following as new sections:
9-4-803. Short title.
Sections 9-4-804 - 9-4-810 are known and may be cited as the "Tennessee
Transactional Gold and Silver Act."
9-4-804. Legislative findings and purpose.
(a) The general assembly finds and declares:
(1) Several states have introduced or enacted legislation to recognize
transactional gold and silver;
(2) The use of gold and silver as a medium of exchange has a historical
basis in fostering economic stability and individual liberty;
(3) Recognizing gold and silver as legal tender promotes economic
justice by allowing citizens of every economic stratus access to the ability to
preserve their wealth by hedging against inflation with precious metals; and
(4) Allowing the use of gold and silver as legal tender provides
individuals and businesses within this state an alternative option for preserving
and exchanging wealth.
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(b) The purpose of §§ 9-4-805 - 9-4-810 is to allow transactional gold and silver
to be used as voluntary, opt-in mediums of exchange held in physical form.
Transactional gold and silver does not constitute a central bank digital currency and
must not be used by this state or a public entity as a mechanism for surveillance, social
scoring, behavioral conditioning, or any form of social or economic control.
9-4-805. Definitions for §§ 9-4-804 - 9-4-810.
As used in §§ 9-4-804 - 9-4-810:
(1) "Bullion" means refined precious gold or silver metal, in any shape or
form, valued primarily based on its metal content and not on its form or function,
and includes, as applicable, gold coin and silver coin;
(2) "Bullion depository" means an entity providing vault facilities within
the United States for the storage of bullion that:
(A) Complies with the prescribed London Bullion Market
Association or equivalent best-practice guidelines; and
(B) Has a contractual relationship to provide services for deposits
of specie or legal tender for an authorized electronic payment system
vendor;
(3) "Depository agent" means a private entity authorized by the treasurer
to operate a bullion depository or perform related services;
(4) "Electronic payment system" means an electronic platform or
payment system that enables participating vendors to receive and process a
payment from an account holder of a bullion depository using specie held in the
bullion depository as the basis for the payment transaction and that:
(A) Uses bullion held in a bullion depository for electronic
transactions;
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(B) Allows for the redemption of bullion by system participants;
(C) Enables account holders to make payments to participating
vendors; and
(D) Is authorized and approved by the treasurer to provide
accounts that hold bullion and allow users to buy, sell, save, or spend
bullion as a form of legal tender;
(5) "Gold coin" and "silver coin" means, as applicable, gold or silver metal
that is:
(A) In bars or other physical forms certified at least:
(i) For gold metal, ninety-nine and one-half percent
(99.5%) pure; and
(ii) For silver metal, ninety-nine and nine-tenths percent
(99.9%) pure; and
(B) Coined, stamped, or imprinted with its weight and purity;
(6) "Legal tender" means a medium of exchange, including specie,
recognized by this state for the payment of debts, taxes, fees, and other
obligations;
(7) "Social credit scoring system" means a system of recordkeeping, data
collection, or scoring that evaluates, monitors, or ranks an individual's or entity's
behavior, beliefs, associations, or compliance with government or corporate
standards, and that conditions access to services, benefits, or opportunities
based on that evaluation;
(8) "Specie":
(A) Means coin or bullion having intrinsic value and used or
intended for use as money; and
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(B) Includes transactional gold and silver; and
(9) "Transactional gold and silver" means a representation, in the exact
units of metal in fractional troy ounces or grams, of physical gold, silver, or bullion
that:
(A) May be transferred through electronic or written instruction by
the owner;
(B) May be used to make or receive payments, or to transfer
value, within this state or between parties who consent to its use; and
(C) Is fully backed by specie held in a bullion depository and
redeemable on demand by the holder in the underlying gold or silver
specie or bullion.
9-4-806. Legal tender.
(a) Specie is recognized as legal tender in this state.
(b) Specie may be used for the payment of:
(1) Debts between private parties, if mutually agreed upon; and
(2) Taxes, fees, or other obligations owed to the state or a political
subdivision, if the state or political subdivision agrees to accept specie as
payment.
(c) A person or entity must not be compelled to accept specie as payment,
except as provided in subdivision (b)(2), by mutual agreement, or where payments are
made by an electronic payment system participant in specie and the other party receives
U.S. dollars utilizing traditional payment mechanisms.
9-8-807. Bullion depository and electronic payment system.
(a) The treasurer shall:
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(1) Designate or establish a bullion depository for secure storage of
specie to facilitate transactions; and
(2) Authorize an electronic payment system to enable vendors to receive
and process payments using specie.
(b) The treasurer may:
(1) Operate the bullion depository directly or contract with a depository
agent; and
(2) Contract with one (1) or more private entities to develop or operate
the electronic payment system.
(c) The treasurer shall ensure:
(1) The bullion depository is secure, transparent, and accessible for use
by any person;
(2) The electronic payment system is reliable and compliant with state
and federal law;
(3) A depository agent or contracted entity operates in the best interests
of the state and its depositors;
(4) Deposits in the bullion depository for the purpose of electronic
exchange are to be insured for one hundred percent (100%) of the full
replacement value under an all-risk insurance policy issued by a non-
governmental operated insurer;
(5) The sufficiency of specie held by the bullion depository is regularly
verified;
(6) Electronic system vendors are authorized to do business within this
state and compliant with federal and state money transmitter laws;
(7) Appropriate fraud prevention measures are established;
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(8) The privacy of system participants in such a manner that transaction
information will not be shared without proper court authorization, and that
information must not be used in a social credit scoring system; and
(9) Participants' deposits are the sole property of the owner and are not
subject to seizure by the state without prior written notice and an opportunity to
contest the seizure.
9-4-808. Tax exemptions.
The exchange of one (1) type or form of legal tender for another type or form of
legal tender is not subject to taxation by the state or a political subdivision.
9-4-809. Report.
The treasurer shall submit an annual report on or before February 1, 2028, and
on or before February 1 of each subsequent year, to the general assembly detailing:
(1) The status and operations of the bullion depository;
(2) The implementation and usage of the electronic payment system; and
(3) The economic impact of recognizing gold and silver coin as legal
tender.
9-4-810. Rulemaking.
The treasurer may promulgate rules in accordance with the Uniform
Administrative Procedures Act, compiled in title 4, chapter 5, to effectuate this part.
SECTION 3. If any provision of this act or its application to any person or circumstance
is held invalid, then the invalidity does not affect other provisions or applications of the act that
can be given effect without the invalid provision or application, and to that end, the provisions of
this act are severable.
SECTION 4.
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(a) The headings in this act are for reference purposes only and do not
constitute a part of the law enacted by this act. However, the code commission is
requested to include the headings in any compilation or publication containing this act.
(b) The code commission is requested to revise the heading for Tennessee
Code Annotated, Section 9-4-801 to more accurately reflect the change made pursuant
to SECTION 1.
SECTION 5. For purposes of promulgating rules, this act takes effect upon becoming a
law, the public welfare requiring it. For all other purposes, this act takes effect January 1, 2027,
the public welfare requiring it.