Hagerty, Tillis, Colleagues Seek Answers on SEC Changes to U.S. Equity Market Structure

NASHVILLE, TN—United States Senator Bill Hagerty (R-TN), a member of the Senate Banking Committee, today joined Senator Thom Tillis (R-NC), along with Senators Mike Crapo (R-ID), Cynthia Lummis (R-WY), and Kevin Cramer (R-ND), in sending a letter to Gary Gensler, Chairman of the U.S. Securities and Exchange Commission (SEC), seeking answers in response to several proposed radical revisions to U.S. equity markets structure.

“Long-considered the global gold standard, U.S. equity markets facilitate a dynamic American economy and allow the average American working family to achieve their long-held financial goals, such as buying a house, sending their children to college, and retiring with economic security. As such, we agree with the SEC’s October 2021 report on equity market structure conditions, which noted that the widespread adoption of innovative technology and digital platforms by broker-dealers and investment advisers has made investing and trading in securities more accessible to a broader range of individuals than ever before,” the Senators wrote.

“Despite the SEC’s findings, and your own strong agreement during an August 2021 Senate Committee on Banking, Housing, and Urban Affairs hearing that increased retail investor market participation is a good thing for America, it is significantly concerning that the SEC, under your leadership, is working to push forward a number of proposals which will discourage – not encourage – the type of competition and innovation that has revolutionized markets and benefitted investors,” the Senators continued.

“Given the potential impact of these rules, the unprecedented lack of input from stakeholders is alarming. Previous wholesale market structure reforms were conducted with extensive outreach prior to formal rulemaking. Regulation NMS, for instance, which shapes much of our modern market structure, was formally proposed after months of public engagement, public/private dialogue, concept releases, and stakeholder feedback. Subsequently, after proposals were released, the Commission continued public engagement, including holding public roundtables with market participants, and a subsequent follow-on comment period after this engagement,” the Senators concluded.

A copy of the letter can be found here.