; and (ii) a statement of policies and procedures the covered person has in place to comply with State laws that are applicable to the financial innovation. (2) State exception for consumer harm Notwithstanding paragraph (1)(B), a State may commence an enforcement action against a covered person with respect to a financial innovation that is the subject of an enforceable compliance agreement if, in an action brought by the State in a court of competent jurisdiction, the court determines that the agency’s action was arbitrary and capricious and the financial innovation has substantially harmed consumers within such State. (e) Arbitration A covered person may elect to arbitrate any action initiated by another person relating to a financial innovation that is the subject of the enforceable compliance agreement. 9. Report to Congress Not later than 1 year after the date of the enactment of this Act, and annually thereafter, the Financial Stability Oversight Council shall submit to Congress a report on the aggregate impact of enforceable compliance agreements entered into under this Act, which shall include— (1) the number and characteristics of the agreements; (2) the most innovative and least burdensome tools that the agency’s FSIO has implemented to allow a financial innovation that is the subject of an enforceable compliance agreement to be offered; (3) strategies implemented to coordinate and facilitate cooperation among FSIOs; (4) the existing Federal and State laws, regulations, or practices (including guidance materials, examinations, and enforcement proceedings and settlements) that the Financial Stability Oversight Council identifies as the most burdensome to innovation that adversely affect competition in the financial services industry, or that restrict improvements for consumers of financial products or services