On May 9, Healthy Markets Association (HMA) President and CEO Tyler Gellasch sent a letter to SEC Chairman Paul Atkins addressing the President’s Executive Order on Reducing Anti-Competitive Regulatory Burdens.
The Financial Data Transparency Act of 2022, which was enacted under the Fiscal Year 2023 National Defense Authorization Act (NDAA), directed federal financial regulators to jointly issue regulations “establishing data standards for (1) certain collections of information reported to each Agency by financial entities under the jurisdiction of the Agency, and (2) the data collected from the Agencies on behalf of the Financial Stability Oversight Council (FSOC).” The FDTA demands that financial regulators’ data standards include the use of common, non-proprietary legal identifiers for financial products, instruments, and transactions. Further, identifiers must be available under an open license, at no cost to the public.
HMA’s letter notes that HMA’s members are “active market participants in nearly every aspect of the securities markets, and are uniquely positioned to see where regulations have created specific chokepoints for market participants to impede competition, efficiency, and fairness,” and that HMA “reads and summarizes every single one of the more than one thousand filings by the securities markets self-regulatory organizations each year.”
Speaking from this vantage, HMA’s letter focuses on rules related to the plumbing of securities markets trading and reporting that inhibit competition or – in some cases – expressly authorize monopolistic practices, leading to significant market distortions and the capture of economic rents at the expense of more competitive, efficient, fair, and orderly markets. While noting that there are many such examples within the purview of the Commission, HMA emphasizes two for special consideration: (1) the Commission’s regulatory mandates related to the use of proprietary security and entity identifiers, and (2) the Commission’s lack of effective oversight of self-regulatory organizations’ fee filings.
You can read the entire HMA letter here.
