Berks County News

A coalition of Republican members of the Financial Services Committee Capital Markets Subcommittee has expressed significant opposition to the Securities and Exchange Commission's (SEC) recent proposal to prohibit volume-based exchange transaction pricing. Led by Congressman Dan Meuser and Subcommittee Chairman Ann Wagner, they argue that the proposal is misguided and lacking in empirical foundation.

In a letter addressed to SEC Chair Gary Gensler, the coalition argues that volume-based discounts are integral to various sectors of the economy, promoting competition and enhancing consumer benefits. These discounts play a crucial role in fostering liquidity in the securities markets. Prohibiting these discounts, they warn, could undermine fundamental market dynamics and display a lack of understanding of market operations at the Commission.

The coalition also raises concerns about the lack of concrete evidence supporting the SEC's proposal. They caution that the initiative relies more on conjecture than on empirical data, potentially disrupting the market without just cause. Furthermore, they argue that the proposal could lead to a less transparent market with fragmented liquidity, contradicting the SEC's mandates. It also raises concerns about decreased competition, potentially resulting in higher costs for investors, which the SEC claims to help with this misguided proposal.

The letter, co-signed by several members of the Capital Markets Subcommittee including Reps. Pete Sessions, Bill Huizenga, Tom Emmer, Bryan Steil, Andrew Garbarino, Michael Lawler, Zach Nunn, and Erin Houchin, urges the SEC to reconsider this proposal. The members request a detailed response from the SEC to several pertinent questions, focusing on the empirical basis of the proposal, its potential impact on market liquidity and global competitiveness, and its implications for the existing regulatory framework.

The Republican members conclude by urging the SEC to create a regulatory environment that is coherent, transparent, and responsive to the actual dynamics of the market ecosystem, rather than imposing unnecessary restrictions.

In a statement, Rep. Dan Meuser emphasized the importance of protecting the health of the markets and ensuring fair play. He stated, "Our letter to the SEC sends a clear message: we won't stand by while unnecessary regulations threaten the health of our markets. Volume-based discounts are more than just numbers; they're about fair play and smart business. The SEC's proposal to do away with them shows a worrying disconnect from real-world market practices. We're in this to protect every investor out there. As Republicans, we believe in rules that make sense, that are based on hard facts, not just theories. Our markets thrive on competition and transparency, and that's the kind of environment we're fighting to preserve."

The letter can be found [here](link to the letter).

Click this link to access more information: https://meuser.house.gov/media/press-releases/republicans-challenge-secs-proposal-prohibit-volume-based-exchange-transaction