Press Releases

Rep. Loudermilk (R-GA) issued the following statement after introducing bipartisan legislation to modernize the Securities Exchange Act:

“Regulatory agencies have a tendency to expand their reach into areas they should not be regulating and engage in mission creep, which can stifle innovation. As a small business owner, we embraced new technology and used it to benefit our customers. Instead of trying to make new ideas fit into old, one-size-fits-all regulations, agencies should adjust to allow business and individuals the opportunity to grow. In order to update the Securities Exchange Act of 1934, I introduced H.R. 3555, the Exchange Regulatory Improvement Act. Georgia companies face compliance burdens on parts of their businesses that should not be regulated as exchanges, and this bill will put guardrails on the agencies to prevent overregulation. We need a new, fresh approach, and this bipartisan legislation will go a long way in bringing a 1930s law into the 21^st century.”

Background

• H.R. 3555, the Exchange Regulatory Improvement Act, proposes to update the definition of a “facility” of a stock exchange under the Securities Exchange Act of 1934, to account for new business models that have been developed by stock exchanges in the years since the law was written.
• Various stock exchanges have recently established subsidiaries involving data management services, regulatory compliance technology, and others.
• The bill clarifies that a facility of an exchange does not include businesses that are not “for the purpose of effecting or reporting a transaction on an exchange” for regulatory purposes.
• This bill will ensure that business activities that are unrelated to effecting or reporting a transaction on an exchange are not subject to regulation as an exchange. However, the bill will not exempt functions of exchanges that are material to securities trading from Securities and Exchange Commission supervision, such as market data, listing standards, and colocation. 
• Original co-sponsors of this legislation are Rep. David Scott (D-GA), Rep. Randy Hultgren (R-IL), Rep. Greg Meeks (D-NY), and Rep. Lee Zeldin (R-NY.)