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McHenry, Toomey Blast Chair Gensler for Limiting Public Input on SEC Rulemakings

Washington, January 10, 2022 -

Today, the top Republican on the House Financial Services Committee, Patrick McHenry (R-NC), and the top Republican on the Senate Banking Committee, Pat Toomey (R-PA), sent a letter to Securities and Exchange Commission (SEC) Chair Gary Gensler. The letter raises serious concerns with Chair Gensler’s decision to limit outside input on rulemakings by providing unreasonably short public comment periods. The Republican leaders demand Chair Gensler extend the comment periods on active rulemakings to ensure they are deliberative and effective.

Read the full letter to SEC Chair Gensler here.

Read excerpts from the letter to SEC Chair Gensler:

“Dear Chair Gensler:

“We are concerned that the Securities and Exchange Commission (“SEC”) rulemakings under your tenure have consistently provided unreasonably short comment periods, which will harm the quality of public comment and may run afoul of the Administrative Procedure Act. The SEC should remedy this disturbing and unprecedented pattern – which contradicts executive orders from both Democratic and Republican administrations meant to encourage deliberative rulemakings – by extending the comment period of all proposed rulemakings that have been released during your time at the SEC.

“The notice-and-comment process is critical to effective SEC rulemaking. The opportunity to comment on proposed rulemakings ensures the public can provide substantive analysis, warn of unintended negative consequences, and suggest alternative approaches with rationale for the SEC to consider. This commentary helps refine and improve adopted rulemakings – and in some cases provides a basis for the SEC to rethink or scrap imprudent rulemakings entirely.

“President Obama’s White House appropriately recognized that public comment periods on most rulemakings should be at least 60 days.  Extended comment periods, for example, for 90 days or 120 days, are also appropriate when taking up particularly complex rulemakings or when numerous rulemakings are simultaneously outstanding.  The Administrative Conference of the United States, an independent federal agency within the executive branch charged with recommending improvements to administrative process and procedure, similarly endorses a comment period of at least 60 days for significant regulatory actions.  

“Despite these recommended practices, the majority of SEC proposals put forward under your chairmanship have thus far allowed less than 60 days for public comment. Two proposals provide 60-day comment periods, three proposals provide 45-day comment periods, and six proposals provide 30-day comment periods.  Moreover, several of these proposals with shorter comment periods coincide with federal holidays (Christmas, New Year’s Day, and/or Martin Luther King Jr. Day) yet do not allot extra days in light of those holidays.  While the money market fund reform proposal from last month provides a 60-day comment period, that is still an insufficient amount of time for such significant revisions to money market fund rules. 

“We urge you to immediately extend all comment periods for the SEC’s proposed rules of significance to at least 60 days, including reopening the comment filing for those rulemakings with shorter comment periods that have closed prematurely. Finally, we request that you extend the comment period on the money market fund rule revisions to at least a 90-day comment period, consistent with the process for the most recent prior significant substantive revisions to the money market fund rule. …”


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