HR 634

Original Sponsor

Rep. Grimm

OSEC Papers

Letter to House Financial Service Committee

April 30, 2013

OSEC View

Margin requirements help mitigate risk by providing cash collateral to protect against adverse movements in derivatives transactions. So, eliminating margin requirements only increases the risk profile of the involved companies by making hedging activity more risky. 

Bill Summary

Passed House amended (June 12, 2013)

Business Risk Mitigation and Price Stabilization Act of 2013 - Amends the Commodity Exchange Act (CEA) to exempt, from the rules of prudential regulators for swap dealers and major swap participants with respect to initial and variation margin requirements for swaps not cleared by a registered derivatives clearing organization (including any such requirements imposed by related rules), those swaps in which one of the counterparties: (1) is eligible for an exemption from clearing requirements for certain significant price discovery agreements, contracts, or transactions in a commodity exempt from regulation by the Commodity Futures Trading Commission (CFTC); (2) is eligible for a public interest exemption from swap clearing requirements for certain cooperative entities; or (3) satisfies specified criteria governing treatment of affiliates in connection with clearing requirements.

Amends the Securities Exchange Act of 1934, regarding registration and regulation of security-based swap dealers and major security-based swap participants, to exempt from initial and variation margin requirements for swaps not cleared by a registered derivatives clearing organization a security-based swap in which one of the counterparties: (1) qualifies for a specified exception from clearing requirements, or (2) satisfies certain criteria governing the treatment of affiliates.

Requires that the amendments to CEA made by this Act be implemented: (1) without regard to federal information policy requirements or the notice and comment requirements of federal administrative procedure; and (2) through promulgation of an interim final rule, pursuant to which public comment will be sought before a final rule is issued.

Limits the disregard of such federal information policy and notice and comment requirements solely to changes to rules and regulations, or proposed rule and regulations, that are limited to, and directly a consequence of, the amendments to CEA made by this Act.
HR 701

Original Sponsor

Rep. McHenry

OSEC Papers

None

None

OSEC View

This bill proposed to hasten the rule-making of exempting certain securities from regulation under the Securities Act of 1933 as per the Jumpstart Our Business Startups Act (JOBS Act of 2012). We find it surprising that, while other important regulatory rules have been significantly delayed or not implemented, Congress would choose to force the SEC to speed up its rule-making in exempting securities from regulation.

Bill Summary

Passed House amended (May 15, 2013)

Amends the Securities Act of 1933 to set October 31, 2013, as the deadline for the Securities and Exchange Commission (SEC) to add a class of domestic securities to those already exempted from regulation under that Act in accordance with specified terms and conditions, including that: (1) the aggregate offering amount of all securities offered and sold within the prior 12-month period in reliance on the new exemption shall not exceed $50 million, (2) the securities may be offered and sold publicly, and (3) they shall not be restricted securities under federal securities laws and regulations.
HR 742

Original Sponsor

Rep. Crawford

OSEC Papers

Letter to House Financial Service Committee

April 30, 2013

OSEC View

By repealing the indemnification requirement, this helps enable better data sharing across regulatory agencies and especially foreign regulatory agencies.

Bill Summary

Passed House without amendment (June 12, 2013)

(This measure has not been amended since it was introduced. The summary of that version is repeated here.)

Swap Data Repository and Clearinghouse Indemnification Correction Act of 2013 - Amends the Commodity Exchange Act, with respect to derivatives clearing organizations and swap data repositories, to repeal the prerequisite that, before the Commodity Futures Trading Commission (CFTC) may share information with specified regulatory agencies, such agencies must agree to indemnify the CFTC for expenses arising from litigation relating to information so provided.

Amends the Securities Exchange Act of 1934 to repeal similarly the prerequisite that, before a security-based swap data repository may share information with specified regulatory entities, such entities must agree to indemnify both such repository and the Securities and Exchange Commission (SEC) for expenses arising from litigation relating to information so provided.
HR 992

Original Sponsor

Rep. Hultgren

OSEC Papers

Letter to House Financial Service Committee

April 30, 2013

OSEC View

This bill continues to concentrate and centralize risk in financial institutions by allowing them to engage in more derivatives activities and still be eligible for government bailouts. Additionally, this concentration of risk will reduce balance sheet transparency and increase the difficulty for regulators in trying to identify and prevent risk concentrations before they pose a systemic risk.

Bill Summary

Passed House without amendment (October 30, 2013)

(This measure has not been amended since it was introduced. The summary of that version is repeated here.)

Swaps Regulatory Improvement Act - Amends the Dodd-Frank Wall Street Reform and Consumer Protection Act with respect to the prohibition against certain federal assistance to swaps entities, namely the use of any advances from specified Federal Reserve credit facilities or discount windows, or Federal Deposit Insurance Corporation (FDIC) insurance or guarantees, for the purpose of: (1) making any loan to, or purchasing any stock, equity interest, or debt obligation of, any swaps entity; (2) purchasing the assets of any swaps entity; (3) guaranteeing any loan or debt issuance of any swaps entity; or (4) entering into any assistance arrangement (including tax breaks), loss sharing, or profit sharing with any swaps entity.

Extends to any major swap participant or major security-based swap participant that is an uninsured U.S. branch or agency of a foreign bank the exemption from the prohibition against federal assistance to swaps entities which is currently limited to any major swap participant or major security-based swap participant that is an FDIC-insured bank or savings association.

Designates both uninsured U.S. branches or agencies of a foreign bank and insured depository institutions as "covered depository institutions."

Requires any covered depository institution exempted from the prohibition to limit its swap and security-based swap activities to hedging and similar risk mitigating activities (as under current law), non-structured finance swap activities, or certain structured finance swap activities. (Defines "structured finance swap" as a swap or security-based swap based on an asset-backed security [or group or index primarily composed of asset-backed securities].)

Qualifies a structured finance swap activity for the exemption if: (1) it is undertaken for hedging or risk management purposes, or (2) each asset-backed security underlying the structured finance swap is of a credit quality and of a type or category with respect to which the prudential regulators have jointly adopted rules authorizing such a swap or security-based swap activity by covered depository institutions.

Repeals the exemption from the prohibition for any insured depository institution that limits its swap and security-based swap activities to acting as a swaps entity for: (1) swaps or security-based swaps involving rates or reference assets that are permissible for investment by a national bank; or (2) credit default swaps, including those referencing the credit risk of asset-backed securities unless they are cleared by a derivatives clearing organization or a clearing agency registered, or exempt from registration, under the Commodity Exchange Act or the Securities Exchange Act.
HR 1038

Original Sponsor

Rep. LaMalfa

OSEC Papers

Letter to House Financial Service Committee

April 30, 2013

OSEC View

This bill reduces transparency in the energy and gas swap markets by exempting most companies that engage in swaps with natural gas and power utilities from having to register with the CFTC as a swap dealer. This reduced transparency could negatively impact the price discovery mechanism for energy and gas markets and increase the volatility of energy prices. 

Bill Summary

Passed House without amendment (June 12, 2013)

(This measure has not been amended since it was introduced. The summary of that version is repeated here.)

Public Power Risk Management Act of 2013 - Amends the Commodity Exchange Act to direct the Commodity Futures Trading Commission (CFTC), when it determines whether to provide an exemption to designation as a swap dealer, to treat a utility operations-related swap entered into with a utility special entity as if such swap were entered into with an entity that is not a special entity. (Thus exempts an entity entering into a utility operations-related swap with a utility special entity from mandatory registration as a swap dealer.)

Requires transactions in utility operations-related swaps to be reported according to requirements for the reporting of uncleared swaps.

Defines "utility special entity" as a special entity, or any instrumentality, department, or corporation of or established by a state or local government, that: (1) owns or operates an electric or natural gas facility or an electric or natural gas operation; (2) supplies natural gas or electric energy to another utility special entity; (3) has public service obligations under federal, state, or local law or regulation to deliver electric energy or natural gas service to customers; or (4) is a federal power marketing agency.

Redefines swap to include a utility operations-related swap.

Defines "utility operations-related swap" as one that: (1) is entered into to hedge or mitigate commercial risk; (2) is associated with specified transactions in electric energy or natural gas; and (3) is not a contract, agreement, or transaction based on, derived on, or referencing an interest rate, credit, equity, or currency asset class; or a metal, agricultural commodity, or crude oil or gasoline commodity of any grade, except as used as fuel for electric energy generation.
HR 1062

Original Sponsor

Rep. Garret

OSEC Papers

OSEC View

This bill increases the hoops the SEC would have to jump through to issue new regulations by requiring excessive cost-benefit analysis, assessment of alternatives to regulation, consideration of how the regulation will impact the financial industry and a periodic review of existing regulations to determine whether they are "excessively burdensome". The SEC already conducts cost-benefit analysis on proposed regulations. This bill would increase the workload of an already over-burdened agency struggling to propose and implement much needed regulations. This bill is bad for consumers.

Bill Summary

Passed House amended (May 17, 2013)

SEC Regulatory Accountability Act - (Sec. 2) Amends the Securities Exchange Act of 1934 (Act) to direct the Securities and Exchange Commission (SEC), before issuing a regulation under the securities laws, to: (1) identify the nature and source of the problem that the proposed regulation is designed to address in order to assess whether any new regulation is warranted; (2) use the SEC Chief Economist to assess the costs and benefits of the intended regulation and adopt it only upon a reasoned determination that its benefits justify the costs; (3) identify and assess the available alternatives that were considered; and (4) ensure that any regulation is accessible, consistent, written in plain language, and easy to understand.

Requires the SEC to: (1) consider whether the rulemaking will promote efficiency, competition, and capital formation; (2) consider the impact of the regulation upon investor choice, market liquidity, and small business; (3) explain in its final rule the nature of comments received concerning the proposed rule or rule change; and (4) respond to those comments, explaining any changes made in response and the reasons that it did not incorporate industry group concerns regarding potential costs or benefits.

Requires the SEC to: (1) review periodically its existing regulations to determine if they are outmoded, ineffective, insufficient, or excessively burdensome; and (2) modify, streamline, expand, or repeal them.

Requires the SEC, whenever it adopts or amends a major rule, to state in its adopting release: (1) the purposes and intended consequences of the regulation, (2) the post-implementation quantitative and qualitative metrics to measure the economic impact of the regulation and the extent to which it has accomplished the stated purposes, (3) the assessment plan that will be used under the supervision of the Chief Economist to assess whether the regulation has achieved those purposes, and (4) any foreseeable unintended or negative consequences.

Requires the assessment plan to: (1) consider the costs, benefits, and intended and unintended consequences of the regulation; (2) specify the data to be collected, the methods for its collection and analysis, and an assessment completion date; and (3) analyze jobs added or lost as a result of the regulation, differentiating between public and private sector jobs.

Waives notice and comment requirements for the data collection if the SEC has published its assessment plan for notice and comment at least 30 days before adoption of a final regulation or amendment.

(Sec. 3) Expresses the sense of Congress that the Public Company Accounting Oversight Board should also follow the requirements set forth by this Act.

(Sec. 4) Prohibits a rule adopted by either the Municipal Securities Rulemaking Board or any registered national securities association from taking effect unless the SEC determines that, in adopting such rule, such entities have complied with the requirements of this Act.
HR 1105

Original Sponsor

Rep. Hurt

OSEC Papers

None

None

OSEC View

This bill reduced transparency by allowing certain private equity fund investments to be exempt from certain regulatory requirements. Private equity fund investments need more regulation and sunlight rather than more exemptions from existing laws. This bill has nothing to do with access to capital markets or preserving jobs.

Bill Summary

Passed House without amendment (December 4, 2013)

(This measure has not been amended since it was introduced. The summary of that version is repeated here.)

Small Business Capital Access and Job Preservation Act - Amends the Investment Advisers Act of 1940 to exempt private equity fund investment advisers from its registration and reporting requirements, provided that each private equity fund has not borrowed and does not have outstanding a principal amount exceeding twice its invested capital commitments.

Directs the Securities and Exchange Commission (SEC) to promulgate final rules that: (1) require such investment advisers to maintain records the SEC determines necessary, taking into account fund size, governance, investment strategy, and risk; and (2) define the term "private equity fund" for purposes of this Act.
HR 1256

Original Sponsor

Rep. Garret

OSEC Papers

Letter to House Financial Service Committee

April 30, 2013

OSEC View

This bill adds another layer of complexity for swaps regulatory compliance between US and non-US regulatory regimes by introducing a new "broadly equivalent" standard for exempting non-US entities from swap regulatory requirements under Title VII of the Dodd-Frank Act. However, the CFTC already intends to allow for "substituted compliance" of overseas regulatory regimes using a standard of "comparable" regimes. So, this bill is unnecessary and may, at worst, impede the continuing work of the CFTC and SEC on extraterrestrial applications of the Dodd-Frank Act. Also, we note that Congress could better resolve this issue by providing the regulators with the resources they need to fulfill their regulatory burdens.

Bill Summary

Passed House amended (June 12, 2013)

(This measure has not been amended since it was reported to the House as amended, Part I, on June 10, 2013. The summary of that version is repeated here.)

Swap Jurisdiction Certainty Act - Directs the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) to issue jointly rules governing the application of swaps requirements of the Securities Exchange Act of 1934 and the Commodity Exchange Act, relating to cross-border swaps and security-based swaps transactions involving U.S. persons or non-U.S. persons.

Requires such rules to be identical (except to the extent necessary to accommodate differences in other underlying statutory requirements), and to address: (1) the nature of the connections to the United States that require a non-U.S. person to register as a swap dealer, major swap participant, security-based swap dealer, or security-based swap participant under each Commission's respective Acts and related regulations; (2) the extent to which U.S. swaps requirements shall apply to the swap and security-based swap activities of non-U.S. persons, U.S. persons, and their branches, agencies, subsidiaries, and affiliates outside the United States; and (3) the circumstances under which a non-U.S. person in compliance with the regulatory requirements of a foreign jurisdiction shall be exempt from U.S. swaps requirements.

Directs the Commissions to exempt from U.S. swaps requirements any non-U.S. person in compliance with the swaps regulatory requirements of a country or administrative region having one of the nine largest combined swap and security-based swap markets by notional amount in the calendar year preceding issuance of such rules (unless the Commissions jointly determine that such requirements are not broadly equivalent to U.S. swaps requirements).

Requires the Commissions to report to Congress if they determine jointly that the regulatory requirements of such foreign jurisdictions are not broadly equivalent to U.S. swaps requirements.
HR 1564

Original Sponsor

Rep. Hurt

OSEC Papers

None

None

OSEC View

Mandatory external auditor rotation may improve auditor independence and prevent accounting misconduct and was suggested in the Sarbanes-Oxley Act (SOX) as a possible remedy to the accounting scandals around Enron, Worldcom et all. This required rotation has been mandated in various forms in overseas jurisdictions such as the EU and the United Kingdom. By forbidding mandatory external auditor rotation, this bill prevents a potential avenue for improving audit quality and oversight.   

Bill Summary

Passed House amended (July 08, 2013)

Audit Integrity and Job Protection Act - Amends the Sarbanes-Oxley Act of 2002 (SOX) to deny the Public Company Accounting Oversight Board any authority to require that audits conducted for a particular issuer of securities in accordance with SOX standards be conducted by specific registered public accounting firms, or that such audits be conducted for an issuer by different registered public accounting firms on a rotating basis.

Directs the Comptroller General (GAO) to update the November 2003 report, "Study on the Potential Effects of Mandatory Audit Firm Rotation," and review the potential effects (including costs and benefits) of requiring the mandatory rotation of registered public accounting firms.

Requires such update also to study: (1) whether mandatory rotation of registered public accounting firms would mitigate against potential conflicts of interest between registered public accounting firms and issuers; (2) whether such a mandatory rotation would impair audit quality due to the loss of industry or company-specific knowledge gained by a registered public accounting firm through years of experience auditing the issuer; and (3) what effect SOX has had upon registered public accounting firms' independence, and whether additional independence reforms are needed.
HR 2374

Original Sponsor

Rep. Wagner

OSEC Papers

None

None

OSEC View

Establishing a standard investment advisor code of conduct is critical to protecting retail investors. This bill creates significant obstacles in this endeavor by preventing the US Department of Labor and the SEC from establishing these rules until the SEC conducts further study of the issue. Rather than protect investors, this bill seeks to delay the implementation of customer protection rules.

Bill Summary

Passed House amended (October 29, 2013)

(This measure has not been amended since it was reported to the House on September 25, 2013. The summary of that version is repeated here.)

Retail Investor Protection Act - Prohibits the Secretary of Labor from prescribing any regulation under the Employee Retirement Income Security Act of 1974 (ERISA) defining the circumstances under which an individual is considered a fiduciary until 60 days after the Securities and Exchange Commission (SEC) issues a final rule governing standards of conduct for brokers and dealers under specified law.

(Sec. 3) Amends the Securities Exchange Act of 1934 to prohibit the SEC from promulgating a rule establishing an investment advisor standard of conduct as the standard of conduct of brokers and dealers before it has ascertained: (1) if retail customers are systematically harmed or disadvantaged owing to the operation of brokers or dealers under different standards of conduct than those that apply to investment advisors under the Investment Advisers Act of 1940, and (2) whether adoption of a uniform fiduciary standard of care for brokers or dealers and investment advisors would adversely impact retail investor access or availability to personalized investment advice and recommendations.

Requires the SEC: (1) to publish in the Federal Register formal findings that such rules would reduce retail customer confusion regarding standards of conduct applicable to brokers, dealers, and investment advisors; and (2) in proposing such rules, to consider the differences in the registration, supervision, and examination requirements applicable to brokers, dealers, and investment advisors.
HR 2804

Original Sponsor

Rep. Holding

OSEC Papers

None

None

OSEC View

Regulators have several legally mandated procedural, regulatory and analytical requirements to fulfill prior to proposing and finalizing new regulations. This bill imposes several new, duplicative and unnecessary hurdles on all federal agencies in their rulemaking process. This bill would succeed in gumming up the work of regulatory agencies and prevent much needed rules to protect consumers from current financial industry practices.

Bill Summary

Passed House amended (February 27, 2014)

Achieving Less Excess in Regulation and Requiring Transparency Act of 2014 or the ALERRT Act of 2014 - Title I: All Economic Regulations Are Transparent Act - All Economic Regulations are Transparent Act of 2014 or the ALERT Act of 2014 - (Sec. 102) Requires the head of each federal agency to submit a monthly report to the Administrator of the Office of Information and Regulatory Affairs of the Office of Management and Budget (OMB) for each rule such agency expects to propose or finalize during the following year. Sets forth the required content of such reports, including: (1) a summary of the nature of the rule, (2) the objectives of and legal basis for issuance of the rule, (3) the stage of the rulemaking as of the date of submission, and (4) whether the rule is subject to periodic review as a rule with a significant economic impact.

Requires each agency head to submit a monthly report for any rule expected to be finalized during the following year for which the agency has issued a general notice of proposed rulemaking. Requires such reports to include an approximate schedule for completing action on the rule and an estimate of its cost and economic effects.

Requires the Administrator to make such monthly reports publicly available on the Internet.

Requires the Administrator to publish, not later than October 1 of each year, in the Federal Register: (1) information that the Administrator receives from each agency under this Act; (2) the number of rules and a list of each such rule that was proposed by each agency and each rule that was finalized by each agency; (3) the number of agency actions that repealed a rule, reduced the scope or cost of a rule, or accelerated the expiration date of a rule; (4) the total cost of all rules proposed or finalized; and (5) the number of rules for which an estimate of the cost of the rule was not available.

Requires the Administrator to make publicly available on the Internet, not later than October 1 of each year: (1) the analysis of the costs or benefits of each proposed or final rule issued by an agency for the previous year, (2) the docket number and regulation identifier number for each such rule, (3) the number of rules reviewed by OMB for the previous year, (4) the number of rules for which a review by the head of an agency was completed, (5) the number of rules submitted to the Comptroller General (GAO), and (6) the number of rules for which a resolution of disapproval was introduced in Congress.

Prohibits a rule from taking effect until the information required by this Act is posted on the Internet for not less than six months, unless the agency proposing the rule seeks an exemption under the Freedom of Information Act (FOIA) or the President determines by executive order that such rule is necessary because of an imminent threat to health or safety or other emergency, for the enforcement of criminal laws, for national security, or to implement an international trade agreement. Makes such requirement effective eight months after enactment of this Act.

Title II: Regulatory Accountability Act - Regulatory Accountability Act of 2014 - (Sec. 202) Defines "major rule" and "major guidance," for purposes of this Act, as a rule or guidance that is likely to impose: (1) an annual cost on the economy of $100 million or more, adjusted annually for inflation; (2) a major increase in costs or prices; (3) significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of U.S. enterprises to compete with foreign-based enterprises; or (4) significant impacts on multiple sectors of the economy. Defines "high-impact rule" as a rule that is likely to have an annual cost on the economy of $1 billion or more, adjusted annually for inflation. Defines "negative-impact on jobs and wages rule" to mean a rule that is likely to reduce employment or wages.

(Sec. 203) Revises procedures for rulemaking under the Administrative Procedure Act (APA) to require a federal agency, in the rulemaking process, to make all preliminary and final factual determinations based on evidence and to consider: (1) the legal authority under which a rule may be proposed, (2) the specific nature and significance of the problem the agency may address with a rule, (3) whether existing rules have created or contributed to the problem the agency may address with a rule and whether such rules may be amended or rescinded, (4) any reasonable alternatives for a new rule, and (5) the potential costs and benefits associated with potential alternative rules.

Revises rulemaking notice requirements to require an agency to: (1) publish in the Federal Register advance notice of proposed rulemaking involving a major rule, a high-impact rule, a negative-impact of jobs and wages rule, or a rule that involves a novel legal or policy issue arising out of statutory mandates; (2) consult with the Administrator of the Office of Information and Regulatory Affairs of OMB before issuing a proposed rule and after the issuance of an advance notice of proposed rulemaking; (3) provide interested persons an opportunity to participate in the rulemaking process; (4) hold a hearing before the adoption of any high-impact rule; (5) expand requirements for the adoption of a final rule, including requiring that the agency adopt a rule only on the basis of the best evidence and at the least cost; and (6) grant any interested person the right to petition for the issuance, amendment, or repeal of a rule. Specifies the minimum amount of information that must be included in an advance notice.

Requires the Administrator to issue guidelines to promote coordination, simplification, and harmonization of agency rules during the rulemaking process

Exempts from such revised procedures rulemaking that concerns monetary policy proposed or implemented by the Board of Governors of the Federal Reserve System or the Federal Open Market Committee.

(Sec. 204) Imposes new requirements for issuing any major guidance or guidance that involves a novel legal or policy issue arising out of statutory mandates. Authorizes the Administrator to issue guidelines for agencies in issuing major guidance or other guidance.

(Sec. 205) Provides for electronic access to transcripts of testimony and exhibits and other papers filed in a rulemaking proceeding.

Requires the record of decision in a rulemaking proceeding to include information from a hearing under the Information Quality Act or on a high-impact rule.

Requires an agency to grant a petition for a hearing in the case of a major rule, unless the agency reasonably determines that a hearing would not advance consideration of the rule or would unreasonably delay completion of the rulemaking. Exempts from this requirement rulemakings that concern monetary policy proposed or implemented by the Board of Governors of the Federal Reserve System or the Federal Open Market Committee.

(Sec. 206) Provides that an agency's denial of an Information Quality Act petition, or a failure to grant or deny such petition within 90 days, is reviewable by a court as a final action. Allows immediate judicial review of interim rules, other than in cases involving national security interests, issued without compliance with the notice requirements of this Act.

(Sec. 207) Revises standards for the scope of judicial review of agency rulemaking to prohibit a court from deferring to an agency's: (1) interpretation of a rule if the agency did not comply with APA requirements, (2) determination of the costs and benefits or other economic or risk assessment if the agency failed to conform to guidelines on such determinations and assessments established by the Administrator, (3) determinations made in the adoption of an interim rule, or (4) guidance.

(Sec. 208) Defines "substantial evidence" for purposes of evaluating agency adjudications and for rulemaking under APA as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion in light of the record considered as a whole, taking into account whatever in the record fairly detracts from the weight of the evidence relied upon by the agency to support its decision.

(Sec. 209) Provides that the amendments made by this Act to specified provisions of federal law shall not apply to any rulemakings pending or completed on the enactment date of this Act.

Title III: Regulatory Flexibility Improvements Act - Regulatory Flexibility Improvements Act of 2014 - (Sec. 302) Amends the Regulatory Flexibility Act of 1980 (RFA) to: (1) revise the definition of "rule" under such Act to exclude a rule pertaining to the protection of the rights of and benefits for veterans or a rule of particular (and not general) applicability relating to rates, wages, and other financial indicators; and (2) define "economic impact" with respect to a proposed or final rule as any direct economic effect on small entities from such rule and any indirect economic effect on small entities that is reasonably foreseeable and that results from such rule. Includes tribal organizations within the definition of "small governmental jurisdictions" for purposes of such Act.

Requires initial and final regulatory flexibility analyses to: (1) describe alternatives to a proposed rule that minimize any adverse significant economic impact or that maximize the beneficial significant economic impact on small entities, and (2) include revisions or amendments to a land management plan developed by the Secretary of Agriculture or the Secretary of the Interior under specified Acts.

Expands the applicability of RFA to interpretive rules involving internal revenue laws that impose a recordkeeping requirement, without regard to whether such requirement is imposed by statute or regulation.

Revises the definition of "small organization" for purposes of RFA.

(Sec. 303) Requires each federal agency to include in its regulatory flexibility agenda a brief description of the sector of the North American Industrial Classification System that is affected by a proposed agency rule that is likely to have a significant economic impact on a substantial number of small entities.

(Sec. 304) Requires a detailed statement in an initial regulatory flexibility analysis to include: (1) an estimate of the additional cumulative economic impact of the proposed rule on small entities, and (2) a description of any disproportionate economic impact on small entities or a specific class of such entities.

Requires an agency, in developing an initial and final regulatory flexibility analysis, to provide: (1) a quantifiable or numerical description of the effects of a proposed or final rule and alternatives to such rule, or (2) a more general descriptive statement and a detailed statement explaining why quantification is not practicable or reliable.

(Sec. 305) Repeals provisions allowing a waiver or delay of the completion of an initial regulatory flexibility analysis. Requires the Chief Counsel for Advocacy of the Small Business Administration (SBA) to issue rules governing federal agency compliance with RFA requirements. Authorizes the Chief Counsel to modify or amend such rules, to intervene in agency adjudication relating to such rules, and to inform an agency of the impact of its rulemaking on small entities.

(Sec. 306) Revises requirements for agency notification of the SBA Chief Counsel for Advocacy prior to the publication of any proposed rule. Requires agencies to provide the Chief Counsel with: (1) all materials prepared or utilized in making the proposed rule, and (2) information on the potential adverse and beneficial economic impacts of the proposed rule on small entities.

(Sec. 307) Modifies requirements for the periodic review of agency rules affecting small entities to require publication of a plan for review and placement of such plan on the agency website not later than 180 days after the enactment of this Act.

(Sec. 308) Provides for judicial review of an agency final rule for compliance with RFA requirements after publication of such rule.

(Sec. 309) Amends the federal judicial code to grant exclusive jurisdiction to the U.S. Courts of Appeals to review all final rules promulgated by the SBA Chief Counsel for Advocacy governing agency compliance with RFA.

(Sec. 310) Amends the Small Business Act to authorize the SBA Chief Counsel for Advocacy to specify detailed definitions or standards by which a business may be determined to be a small business (size standard) for purposes of all enactments other than the Small Business Act or the Small Business Investment Act of 1958 (for which only the Administrator is authorized to specify small business size standards). Allows a party seeking judicial review of a rule which that includes a definition or size standard approved by the Chief Counsel for Advocacy to join the Chief Counsel as a party in an action for such review.

(Sec. 312) Amends the Small Business Regulatory Enforcement Fairness Act of 1996 to require federal agencies, in developing small entity compliance guides, to solicit input from affected small entities or associations of small entities.

(Sec. 313) Requires the Comptroller General, not later than 90 days after the enactment of this Act, to complete and publish a study that examines whether the SBA Chief Counsel for Advocacy has the capacity and resources to carry out the duties of Chief Counsel under this Act.

Title IV: Sunshine for Regulatory Decrees and Settlements Act - Sunshine for Regulatory Decrees and Settlements Act of 2014 - (Sec. 402) Defines a "covered civil action" as a civil action seeking to compel agency action and alleging that an agency is unlawfully withholding or unreasonably delaying an agency action relating to a regulatory action that would affect the rights of: (1) private persons other than the person bringing the action; or (2) a state, local, or tribal government. Defines a "covered consent decree" and a "covered settlement agreement" as: (1) a consent decree or settlement agreement entered into in a covered civil action, and (2) any other consent decree or settlement agreement that requires agency action relating to a regulatory action affecting the rights of private persons other than the person bringing the action or a state, local, or tribal government.

(Sec. 403) Requires an agency against which a covered civil action is brought to publish the notice of intent to sue and the complaint in a readily accessible manner and to provide interested parties an opportunity to intervene and to conduct settlement negotiations through mediation.

Requires an agency seeking to enter a covered consent decree or settlement agreement to publish such decree or agreement in the Federal Register and online not later than 60 days before it is filed with the court. Provides for public comment and public hearings on a proposed decree or agreement.

Requires the Attorney General or an agency head, if an agency is litigating a matter independently, to certify to the court that the Attorney General or the agency head approves of any proposed covered consent decree or settlement agreement.

Requires each federal agency to submit to Congress an annual report that includes: (1) the number, identity, and content of covered civil actions brought against, and covered consent decrees or settlement agreements entered against or into by, the agency; (2) a description of the statutory basis for each such covered consent decree or settlement agreement; and (3) an award of attorney fees or costs in a civil action resolved by a covered consent decree or settlement agreement.

(Sec. 404) Requires a court to grant de novo review to any motion filed by an agency to modify a previously-entered consent decree if the basis of such motion is that the terms of the decree are no longer fully in the public interest due to the agency's obligations to fulfill other duties or due to changed facts and circumstances.

(Sec. 405) Makes the provisions of this title applicable to any covered civil action filed, or any covered consent decree or settlement agreement proposed to a court, on or after the enactment of this title.
HR 3193

Original Sponsor

Rep. Duffy

OSEC Papers

None

None

OSEC View

The Consumer Financial Protection Bureau (CFPB) is the only federal agency dedicated to consumer protection in the financial sector. This bill would weaken the CFPB by replacing it with a 'Financial Product Safety Commission' vulnerable to Congressional appropriations, leadership senate confirmations and overruling of new rules by other agencies

Bill Summary

Passed House amended (02/27/2014)

Consumer Financial Freedom and Washington Accountability Act - (Sec. 2) Amends the Consumer Financial Protection Act of 2010 to establish, in lieu of the Consumer Financial Protection Bureau (CFPB), an independent Financial Product Safety Commission to regulate the offering and provision of consumer financial products or services under federal consumer financial laws.

Replaces the position of Director of the CFPB with a Commission composed of the Vice Chairman for Supervision of the Federal Reserve System and four additional members appointed by the President, by and with the advice and consent of the Senate, each to serve for a term of five years.

Prohibits the Chair of the Commission from making requests for estimates related to appropriations without the Commission's prior approval.

Repeals requirements for funding the CFPB, including the Consumer Financial Protection Fund.

Subjects the Commission to the congressional appropriations process. Authorizes appropriations for $300 million for each of FY2014 and FY2015.

Repeals the requirement that at least six members of the Consumer Advisory Board be appointed on a rotating basis upon the recommendation of the regional Federal Reserve Bank Presidents.

Makes technical and conforming amendments to the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank), the Electronic Fund Transfer Act, the Expedited Funds Availability Act, the Federal Deposit Insurance Act, and the Federal Financial Institutions Examination Council Act of 1978.

(Sec. 3) Requires the rates of basic pay for all Commission employees to be set and adjusted in accordance with the General Schedule.

(Sec. 4) Amends Dodd-Frank to require the Commission and its contractors to obtain a consumer's permission before requesting, obtaining, accessing, collecting, using, retaining, or disclosing pertinent nonpublic personal information.

(Sec. 5) Authorizes the Chairperson of the Financial Stability Oversight Council (FSOC) to issue a stay of, or set aside, any regulation issued by the Commission (currently, by the CFPB) upon the affirmative vote of the majority of FSOC members (currently, two-thirds), excluding the Commission Chair.

Requires the FSOC, upon the petition of one of its member agencies, to set aside a final regulation prescribed by the Commission (currently, by the CFPB) if the FSOC decides that such regulation is inconsistent with the safe and sound operations of U.S. financial institutions. (Currently the FSOC is merely authorized, upon petition, to set aside a final CFPB regulation if it would put the safety and soundness of the U.S. banking system or the stability of the U.S. financial system at risk.)

Repeals: (1) the prohibition against FSOC set-aside of a regulation after expiration of a specified time period, and (2) mandatory dismissal of a petition if the FSOC has not issued a decision within such time period.

Requires the Commission Chair, when prescribing a rule under federal consumer financial laws, to consider its impact upon the financial safety or soundness of an insured depository institution.

(Sec. 6) Requires the Commission, whenever it proposes a new rule or regulation, to report to the FSOC and make publicly available: (1) an initial regulatory flexibility analysis that includes the financial impact of the proposed rule or regulation upon covered persons, regardless of size; and (2) an analysis of whether the proposed rule or regulation will impair the ability of individuals and small businesses to have access to credit.

(Sec. 7) Repeals the exclusive rulemaking authority of the CFPB (or, now, the Commission) with respect to federal consumer financial law.