The Securities and Exchange Commission (SEC) could be hunkered down conducting cost-benefit analyses on each new rule-making it undertakes, including the scores coming out of the Dodd-Frank Wall Street Reform Act.
In a Thursday announcement, the U.S. House of Representatives committee, which is headed by retiring Rep. Barney Frank (D-Mass), narrowly passed H.R. 2308, also known as the SEC Regulatory Accountability Act.
Previously, Rep. Scott Garrett, (R-N.J.) introduced the provision June 23, 2011; the legislation calls for amendments to be made to the Securities Exchange Act of 1934 to require the Washington, D.C.-based securities watchdog to take on a review process.
The SEC is in the process of writing 98 rules meant to implement provisions of the new Dodd-Frank law passed in July 2010, according to the Davis Polk Progress Report. Of those, 60 have already missed their deadlines for completion.
The provisions requires the SEC to “identify the nature and significance of the problem that the proposed regulation is designed to address in order to assess whether any new regulation is warranted,” a regular assessment of costs by the Office of the Chief Economist and “ensure that any regulation is accessible, consistent, written in plain language, and easy to understand.”
“The bill passed the full committee on a strictly party-line vote, with 30 Republicans voting in favor of the legislation and 26 Democrats opposing it, an announcement from the Committee distributed by Frank listed.
The bill was previously passed through Committee Nov. 15, 2011; an amended format was then forwarded to full Committee, its status report indicated.
Frank added in his comments that the bill was “an attempt by proxy to cut back on financial regulations” previously put in place such as the 2010 Wall Street Reform and Consumer Protection Act.
This morning, an SEC spokesperson declined comment to IMMP regarding the Committee’s passage.
However, previously on Sept. 15, 2011, Chairman Mary Schapiro testified before the Committee stating the “bill would establish a significant number of additional specific standards for cost-benefit analyses for Commission rules and orders.”
“The bill enumerates eleven new factors for the SEC to consider in its economic analysis, each of which would create a new potential challenge to future rules,” she said in her prior testimony. “Moreover, a number of these new factors are potentially in conflict with the SEC’s mission, duplicative of existing requirements, unrelated to SEC rulemaking, or unclear in scope. For example, the bill’s direction to “assess the best ways of protecting market participants” could conflict with the SEC’s mission.”