HFSC considers changes to JOBS Act, Title VII

Jeb Hensarling

Jeb Hensarling

The House Financial Services Committee recently examined nine bills that would make changes to the bipartisan JOBS Act and Title VII of Dodd-Frank, as well as require the SEC to conduct a more thorough cost-benefit analysis in its rulemakings.

Eight of the nine bills considered by the committee are bipartisan measures, and four of the bills were approved by either the full HFSC or the House of Representatives in the previous Congress.

Two bills—H.R. 701 and 801—are amendments to the JOBS Act and would establish a deadline by which the SEC must complete its rules to amend Title IV of Dodd-Frank, as well as clarify that savings and loan institutions are eligible for shareholder and deregistration requirements.

Six other bills pertain to changes to Title VII of Dodd-Frank, and HFSC Chairman Jeb Hensarling pointed to potentially harmful consequences to Title VII in its current form.

“According to one analysis, the derivatives title has generated over 3,700 different tasks for those who are impacted,” Hensarling said. “I think many of us have heard from farmers, ranchers, and factory owners in our district who are concerned that potentially there may be some unintended consequences to the legislation and that perhaps regulators have not thoroughly carried out Congress’ intention. We now have the benefit of almost three years to analyze the impact of the law, to be able again to analyze the unintended consequences of the law. We have the benefit of more knowledge. I believe this committee would be negligent in its duties, I believe, if we did not continue to monitor and improve the Act. I hope no one out of blind loyalty to a brand name will fail to work to improve this Act. Both Mr. Dodd and Mr. Frank previously signaled their willingness to improve the Act that bears their name. I hope that today will not be any different. Regardless of your thought of how good the Act might be, it was not chiseled into stone, it did not come down from Mount Sinai.”

Hensarling said the derivatives title is critical at a time when many American remain unemployed.

“We have heard again from our farmers, our ranchers, our factory owners, from end users, how problematic the current interpretation of these laws may be- or again, an opportunity to add greater certainty where currently uncertainty lies,” Hensarling said. “We know that how companies hedge their risk, so goes their employment opportunities.”

The committee also considered H.R. 1062, which would require the SEC to conduct a more thorough cost-benefit analysis.

“This is another idea that has bipartisan support,” Hensarling said. “More than two years ago, President Obama issued an executive order requiring executive branch agencies to ensure the benefits of any rulemaking outweigh the costs. The President’s executive order does not apply to the SEC. Many believe it is time to ensure, again, a simple cost-benefit analysis.”

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