The Securities Industry and Financial Markets Association (SIFMA) today issued the following statement after the Securities and Exchange Commission (SEC) announced its “Next Steps for Implementation of Mutual Recognition.”
“Today’s SEC announcement publicly recognizes the importance of moving forward with mutual recognition, but we are concerned that the opportunity to deliver tangible results is slipping away; the clock is ticking, and we urge that the SEC take action now,” said Ira Hammerman, senior managing director and general counsel of SIFMA. “For example, the SEC could jumpstart this process with modifications to a 19-year old rule, known as 15a-6. Today, international capital flows are more efficient and US firms more competitive with the help of the Internet, e-mail and other technologies invented in the last two decades. But with 15a-6 still on the books, firms are forced to meet byzantine requirements written at a time when fax machines were the leading telecommunications tool.”
15a-6 needs to be re-written to reflect the cross-border capabilities
of the industry, and the global product demands of its customers.
This would eliminate unnecessary inefficiencies in international
financial transactions, increase investment opportunities and improve the
competitiveness of the U.S. financial services industry.
In the longer-term any cross-border
regulatory modernization effort will involve developing a “mutual recognition”
framework that would recognize comparable regulatory regimes in other countries,
as laid out briefly by the SEC. Importantly,
mutual recognition could also increase international investment opportunities
and enhance risk diversification in the United States at a time when our
economy could benefit significantly from new investment and liquidity.
