To date, the chorus of the new administration has been deregulation. President Donald Trump has stated that he plans “to be cutting a lot out of Dodd-Frank,”1 and on February 3, 2017, issued a memorandum paving the way to reverse the Department of Labor’s Fiduciary Duty Rule,2 as well as an executive order on Core Principles for Regulating the U.S. Financial System (the Executive Order).3 On February 9, 2017, the Department of Labor filed for a 180-day delay of implementation of its fiduciary rule and a new public comment period on the measure while it reviews the rule’s effects on the industry as well as investors’ access to retirement information and financial advice.
The first steps of deregulation have already begun, as evidenced by the announcement of Michael Piwowar, Acting Chair of the U.S. Securities and Exchange Commission (SEC), regarding the reconsideration of the implementation of the SEC’s Pay Ratio Rule4 and Conflict Minerals Rule.5
The deregulatory posture of the new administration is expected to continue under Jay Clayton, the prominent mergers and acquisitions lawyer nominated as the new SEC Chair, and under J. Christopher Giancarlo, Acting Chair of the U.S. Commodity Futures Trading Commission (CFTC), who is expected to be nominated as CFTC Chair. The SEC and CFTC will likely be operating in an environment of reduced budgets and with a Congress favorable to deregulation. These collective circumstances may make it more likely that rule proposals subject to industry opposition will not be adopted. Of course, time will tell.
Over the last several years, numerous former and sitting Republican Commissioners of both the SEC and CFTC have expressed opposition to, or concerns regarding, many adopted and proposed rules. These statements may provide insight into the thinking that will drive potential deregulation in the coming years. The reference tool included in this Sidley Update identifies certain final and proposed rules issued during the post-Dodd-Frank era (many but not all mandated by the Dodd-Frank Act itself) that may be subject to repeal or reform during the new administration. The reference tool is not intended to be comprehensive or dispositive. Instead, it seeks to identify rules that are most likely to be subject to reconsideration, as well as the arguments voiced by Commissioners relating to those rules that may be persuasive in encouraging the new administration to re-evaluate them. As the new administration continues to take form, other rules and regulations may be reconsidered as new members of the administration focus on the executive order on Core Principles for Regulating the U.S. Financial System and other regulatory issues affecting the financial markets.
Please click here to view the Reference Tool.
1 Ben Protess & Julie Hirschfeld Davis, Trump Moves to Roll Back Obama-Era Financial Regulations, The New York Times, Feb. 3, 2017, available at: https://www.nytimes.com/2017/02/03/business/dealbook/trump-congress-financial-regulations.html?action=Click&contentCollection=BreakingNews&contentID=64873002&pgtype=Homepage&_r=2 (quoting statements of President Trump).
2 Memorandum on the Fiduciary Duty Rule, 2017 Daily Comp. Pres. Doc. 95 (Feb. 3, 2017), available at: https://www.gpo.gov/fdsys/pkg/DCPD-201700095/pdf/DCPD-201700095.pdf.
3 Exec. Order No. 13772, 82 Fed. Reg. 9965, 9965-9966 (Feb. 3, 2017), available at: https://www.federalregister.gov/documents/2017/02/08/2017-02762/core-principles-for-regulating-the-united-states-financial-system.
4 Michael S. Piwowar, Comm’r, Sec. & Exch. Comm’n, Reconsideration of Pay Ratio Rule Implementation (Feb. 6, 2017), available at: https://www.sec.gov/news/statement/reconsideration-of-pay-ratio-rule-implementation.html.
5 Michael S. Piwowar, Comm’r, Sec. & Exch. Comm’n, Reconsideration of Conflict Minerals Rule Implementation (Jan. 31, 2017), available at: https://www.sec.gov/news/statement/reconsideration-of-conflict-minerals-rule-implementation.html.
If you have any questions regarding this Sidley Update, please contact the Sidley lawyer with whom you usually work, or
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This reference tool was compiled with assistance from Sidley associates Kate Lashley and Charles Sommers.
Securities & Derivatives Enforcement and Regulatory Practice
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