June 15, 2016

SEC Rulemaking: Garrett Bill Is Brutal

Ever since the SEC – and other federal agencies – have been required to conduct more cost-benefit analyses in the wake of the proxy access court decision in 2011, the pace of rulemaking certainly has slowed – despite a huge ramp up in the size of the SEC’s relatively new Division of Economic & Risk Analysis (Risk Fin).

Things might get worse before they get better. As highlighted in this CII letter, a House bill from Rep. Garrett – the “SEC Regulatory Accountability Act” (HR 5429) – includes provisions that could really paralyze the SEC’s ability to adopt new rules or modify old ones. For example, the bill would require the SEC to revisit a rule within one year of it’s passage – and then every five years after that.

On its face, I know this sounds reasonable – but it would require more resources than you think to undertake this task. Resources that the SEC doesn’t have. Remember that the SEC already is conducting extensive cost-benefit analyses, etc. And bear in mind that all of this doesn’t protect us from stupid laws that Congress passes that requires the SEC to adopt stupid new rules. The bulk of the rulemaking conducted by the SEC over the past decade has been mandated by Congress. So if Congress has a beef with the rules that the SEC is adopting, it should look in the mirror…

Regulation A+: States Lose Challenge In DC Circuit Court

Yesterday, as noted in this blog and this blog, the states of Montana and Massachusetts lost their challenge to the SEC’s adoption of Regulation A+ in the DC Circuit court – as was expected…

Political Contribution: Still a Live Wire for Senate Democrats

Yesterday, SEC Chair White testified before the Senate Banking Committee about the SEC’s oversight obligations. You might recall that two Commissioner nominees still remain to be confirmed – mainly because some Senate Democrats are angry that the nominees wouldn’t commit to adopting rules on disclosing political contributions as noted in this blog.

Anyway, the hearing yesterday produced some fireworks as Senator Schumer & Warren criticized Chair White for removing political spending disclosure from the Reg Flex Agenda – and for launching the disclosure effectiveness project (see this blog). In fact, my blog about the Reg Flex Agenda being “aspirational” even made it into this MarketWatch article that describes the testy exchange.

Great quote from the MarketWatch piece – White to Warren: ‘I am disappointed in your disappointment.’

Broc Romanek