According to Fortune, outgoing Securities and Exchange Commission Chair Mary Jo White is refusing to delay adoption of new rules and regulations. Senate Republicans–in particular the Senate Banking Committee's top two Republicans, Chairman Richard Shelby and Mike Crapo–requested White delay adopting new rules until after Trump takes office. However, as reported by Reuters, White responded to Shelby and Crapo on December 12th, stating that she intends to move forward with derivative reforms mandated by Dodd-Frank, including capital and margin requirements for swap dealers, and a limit on how mutual funds and exchange-traded funds use derivatives to leverage returns.
There remain obstacles to these rules. First, because two commissioner positions remain vacant, there are only three remaining commissioners, of which there must be a quorum to pass the new rules. The other two commissioners, Kara Stein and Michael Piwowar, are democrat and republican, respectively. Second, Congress could quite easily reverse any new rules within 60 legislative days of becoming final, which the Republican-controlled Congress could very well vote to do.
Thus, the takeaway is that firms must still monitor proposed new rulemaking under White's SEC for the next few weeks, while also keeping an eye on what Congress will do in response to any new rules promulgated over the next month or so.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
