House Acts to Require Benefits of SEC Regulations Justify Costs
January 12, 2017 -
The House approved bipartisan legislation on Thursday to ensure that the benefits of proposed regulations from the Securities and Exchange Commission (SEC) justify the costs to jobs, economic growth, and capital formation.
The SEC Regulatory Accountability Act, sponsored by Financial Services Committee member Rep. Ann Wagner (R-MO), passed 243-184.
“Ill-advised laws like the Dodd-Frank Act empower unelected, unaccountable bureaucrats to callously hand down crushing regulations without adequately considering what impact those regulations have on jobs,” said Committee Chairman Jeb Hensarling (R-TX). “The true cost of Washington red tape includes the jobs not created, the small businesses not started and the dreams of our children not fulfilled.”
Under the bill, before issuing a regulation the SEC will be required to:
- identify the nature and source of the problem its proposed regulation is meant to address;
- utilize the SEC’s Chief Economist to assess the costs and benefits of a proposed regulation to ensure the benefits justify the costs;
- identify and assess available alternatives; and
- ensure that any regulations are consistent and written in plain language.
Further, the legislation requires the SEC to engage in a retrospective review of its regulations every five years and conduct post-adoption impact assessments of major rules.