SEC Chair Directs Staff to Delay Climate Disclosure Case
SEC Acting Chair Mark Uyeda directed staff to notify the Eighth Circuit Court, assigned to hear a consolidated legal challenge to the climate-related disclosure rule, to delay scheduling the case for arguments.
The final rule, titled "The Enhancement and Standardization of Climate-Related Disclosures for Investors," would require domestic and foreign registrants to provide climate-related disclosures in their registration statements and annual reports. (See related coverage.) The SEC previously delayed the effective date of its climate-related disclosure rules pending the completion of judicial review.
In a statement, Mr. Uyeda called the rule "deeply flawed" and warned it could cause "significant harm" to capital markets and the economy. Mr. Uyeda stated that the SEC lacked the statutory authority or expertise to address climate issues and that the rule amounted to "climate regulation promulgated under the Commission's seal." Mr. Uyeda also expressed doubts about whether the SEC followed proper procedures under the Administrative Procedure Act.
Mr. Uyeda directed SEC staff to notify the Eighth Circuit on the recent Presidential Memorandum regarding a Regulatory Freeze (see related coverage), and request a delay in arguments "to provide time for the Commission to deliberate and determine the appropriate next steps in these cases."
SEC Commissioner Caroline A. Crenshaw criticized the decision. She noted that Mr. Uyeda acted "without the input of the full Commission." Ms. Crenshaw reiterated her prior defense of the rule, emphasizing that investors had been calling for "consistent, comparable, and reliable climate risk disclosures" for years. She asserted that the SEC has "clear authority" under the Securities Act and the Exchange Act to mandate disclosures that serve the public interest, a power that has been "affirmed and reaffirmed across dozens of disclosure rulemakings over multiple decades."
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