If enacted, this bill would significantly impact the regulatory framework governing financial services by limiting the SEC's ability to create overlapping or contradictory rules. This could streamline compliance processes for businesses in the financial sector and foster a more predictable regulatory environment. However, there is concern that such restrictions may hinder the SEC's ability to respond effectively to evolving market conditions and emerging risks, as it could delay necessary updates to regulations that are crucial for consumer protection and market integrity.
Summary
House Bill 4112, known as the 'Symmetry in Rules Act,' seeks to amend the Securities Exchange Act of 1934 by establishing stricter requirements for the Securities and Exchange Commission (SEC) regarding the issuance of proposed or final rules. The bill explicitly prohibits the SEC from creating any rules that conflict with existing rules or other proposed rules, ensuring a more cohesive regulatory environment for the financial services industry. Additionally, it mandates that the SEC consider the industry-specific costs associated with compliance before adopting new regulations, essentially aiming to prevent undue burdens on specific sectors.
Contention
The main points of contention surrounding HB 4112 include the balance between regulatory clarity and flexibility. Proponents argue that by preventing conflicting rules, the bill will reduce complexity for companies operating within the SEC's jurisdiction, allowing them to allocate resources more efficiently. On the other hand, critics suggest that the bill may inadvertently stifle the SEC’s capacity to enact timely and necessary regulatory changes, which could leave markets vulnerable to risks that require agile responses. This ongoing debate reflects a broader conversation about how best to regulate the financial sector while still promoting innovation and stability.
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Regulatory Accountability Act This bill expands and provides statutory authority for notice-and-comment rulemaking procedures to require federal agencies to consider (1) whether a rulemaking is required by statute or is within the discretion of the agency, (2) whether existing laws or rules could be amended or rescinded to address the problem, and (3) reasonable alternatives to a new rule. For proposed major or high-impact rules that have a specified significant economic impact or adverse effect on the public health or safety, an agency must publish notice of such rulemaking to invite interested parties to propose alternatives and ideas to accomplish the agency's objectives; allow persons interested in high-impact or certain major rules to petition for a public hearing with oral presentation, cross-examination, and the burden of proof on the proponent of the rule; adopt the rule that maximizes net benefits within the scope of the statutory provision authorizing the rule, unless the agency explains the costs and benefits that justify adopting an alternative rule and such rule is approved by the Office of Information and Regulatory Affairs (OIRA); and publish a framework and metrics for measuring the ongoing effectiveness of the rule. Agencies must notify OIRA with certain information about a proposed rulemaking, including specified discussion and preliminary explanations concerning a major or high-impact rule. Further, OIRA must establish certain rulemaking guidelines. Additionally, the bill (1) revises the scope of judicial review of agency actions, and (2) establishes requirements for agencies issuing guidance.