US House passes bill to exempt private equity firms from Wall Street Reform Law
The US House of Representatives on Wednesday passed a bill that would spare private equity funds from federal regulations enacted after the 2007 to 2009 financial crisis.
According to Reuters, the bill would exempt many private equity firms from a provision in the 2010 Dodd-Frank Wall Street Reform Law. The said provision requires firms with more than USD150 million in assets under management to register with the US Securities and Exchange Commission.
Under Dodd-Frank, any firm that registers with the SEC is also subject to reporting rules and is required to open its books to agency examiners for routine compliance inspection, the report said.
Reuters said that the Republican-controlled House passed the bill in a 254-159 vote. Over 30 Democrats also voted in favor.
The bill does not stand a strong chance of becoming law, however, because there is no likely action in the Democrat-controlled US Senate. President Barack Obama earlier threatened to veto the bill, the report said.
Reuters quoted New Jersey Republican Scott Garrett saying that the Dodd-Frank Act has imposed enormous burdens on private equity firms. It forces most funds to spend millions of dollars complying with the new SEC registration and reporting requirements.
SEC Chair Mary Jo White previously recommended against passing the bill, the report said.