May 9, 2022

SEC Extends Comment Periods for Several Rule Proposals

Steven Lofchie Commentary by Steven Lofchie

The SEC extended the comment periods for recently proposed rulemakings relating to climate disclosure, private fund advisers and exchange registration.

The comment period for the proposal on climate disclosures was extended from May 20 to June 17, 2022. The comment periods for the proposals related to private fund advisers and the expanded scope of Regulation ATS were extended to an undetermined date that will be 30 days following publication of the extensions in the Federal Register.

The SEC's decision to extend the comment periods on the three proposals comes in the wake of letters by (i) a group of 25 trade associations requesting additional time to review the proposals (see related coverage) and (ii) a bipartisan group of members of Congress calling on the SEC to grant more time on the private fund advisers proposal (see related coverage).

Commentary

While it is certainly to the good that the SEC extended its comment periods, it does not reflect well on the agency's rulemaking process that the extension requests were needed. Further, the problems with the rulemaking process go well beyond the length of the comment periods; significantly, there is no way that any human being can understand the way in which so many different rule changes may interact with each other. Ready, fire, adopt is not a way to run a financial system.

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