The Securities and Exchange Commission has scheduled an open meeting for June 29 - the eve of an abrupt change in leadership - to vote on proposed rules that would allow companies to talk more freely about public stock offerings, Reuters reports.

If passed, the rules would effectively put an to end to the quiet period for stock offerings, which is essentially a ban on promotional publicity that lasts either 40 or 90 days from the offering. Very large companies with a track record for well-managed offerings would even be permitted to advertise under the new rules, according to Reuters.

Industry observers are expecting a unanimous approval, allowing Chairman William Donaldson to step down on a positive note the following day. But a win for Donaldson is not expected to quell questions about the future direction of the agency, as many in the industry are anxious to see what elements of his agenda will remain intact under new leadership.

Last week, President Bush nominated Rep. Christopher Cox, R-Calif. - an advocate of free enterprise and limited government - to succeed Donaldson, who announced that he would step down on June 30 to return to the private sector.

Bush asked Congress to confirm Cox as soon as possible, which would require getting the necessary papers to the Senate Banking Committee before the August recess. Former President Bill Clinton made a similar request during his term in office when he nominated Arthur Levitt for the SEC chairmanship in April 1993 and Congress confirmed him for the job in late July, reports The Bond Buyer, a sister publication to Money Management Executive.

Cox served as senior associate counsel to late President Ronald Reagan from 1986 to 1988 before being elected to Congress as a representative from Orange County, Calif. He has since served 20 years in Congress, most recently as chairman of the House Committee on Homeland Security.

As an elected official, he championed repealing the estate tax, the capital gains tax on savings and investment and taxes on dividends. He is viewed by many in the industry as being pro-business and in favor of less stringent regulation.

Mutual fund firms figure to benefit from the shakeup at the SEC after enduring arguably the most prolific period of regulation in their history. Investment Company Institute President Paul Schott Stevens immediately issued a statement applauding Cox's nomination.

"Chris Cox has a record of extraordinary accomplishment as a leader in the Congress, as a member of President Reagan's staff at the White House, and as a corporate and securities lawyer in private practice," Stevens said. "He would provide strong direction for the SEC in its vital mission of protecting investors and overseeing our capital markets."

Democrats are concerned that investor protection will suffer with Cox at the helm and that he could roll back some of the key reforms Donaldson set in motion. Some experts are already betting that he will overturn the rule requiring mutual funds to have an independent chairman.

Others say that he will leave the controversial rule alone and focus more on providing relief for small publicly held businesses from Sarbanes-Oxley and proposals to streamline the securities offering process.

While the expected unanimous decision on quiet period rules enables Donaldson to ride off into the sunset, it does not mask what was a rocky relationship with fellow Republican Commissioners Paul Atkins and Cynthia Glassman, who were often critical of Donaldson's initiatives.

With Donaldson out and SEC Commissioner Harvey Goldschmid, a Democrat, planning to resign this summer, the agency is likely to have a very different look to it going forward.

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