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Jeb H.
Republican TX 5

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  • Promoting Job Creation and Reducing Small Business Burdens Act

    by Representative Jeb Hensarling

    Posted on 2015-01-13

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    HENSARLING. Mr. Speaker, pursuant to House Resolution 27, I call up the bill (H.R. 37) to make technical corrections to the Dodd-Frank Wall Street Reform and Consumer Protection Act, to enhance the ability of small and emerging growth companies to access capital through public and private markets, to reduce regulatory burdens, and for other purposes, and ask for its immediate consideration.



    The Clerk read the title of the bill.

    The text of the bill is as follows: H.R. 37 Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Promoting Job Creation and Reducing Small Business Burdens Act''.

    SEC. 2. TABLE OF CONTENTS.

    The table of contents for this Act is as follows: Sec. 1. Short title.

    Sec. 2. Table of contents.

    TITLE I--BUSINESS RISK MITIGATION AND PRICE STABILIZATION ACT Sec. 101. Margin requirements.

    Sec. 102. Implementation.

    TITLE II--TREATMENT OF AFFILIATE TRANSACTIONS Sec. 201. Treatment of affiliate transactions.

    TITLE III--HOLDING COMPANY REGISTRATION THRESHOLD EQUALIZATION ACT Sec. 301. Registration threshold for savings and loan holding companies.

    TITLE IV--SMALL BUSINESS MERGERS, ACQUISITIONS, SALES, AND BROKERAGE SIMPLIFICATION ACT Sec. 401. Registration exemption for merger and acquisition brokers.

    Sec. 402. Effective date.

    TITLE V--SWAP DATA REPOSITORY AND CLEARINGHOUSE INDEMNIFICATION CORRECTIONS Sec. 501. Repeal of indemnification requirements.

    TITLE VI--IMPROVING ACCESS TO CAPITAL FOR EMERGING GROWTH COMPANIES ACT Sec. 601. Filing requirement for public filing prior to public offering.

    Sec. 602. Grace period for change of status of emerging growth companies.

    Sec. 603. Simplified disclosure requirements for emerging growth companies.

    TITLE VII--SMALL COMPANY DISCLOSURE SIMPLIFICATION ACT Sec. 701. Exemption from XBRL requirements for emerging growth companies and other smaller companies.

    Sec. 702. Analysis by the SEC.

    Sec. 703. Report to Congress.

    Sec. 704. Definitions.

    TITLE VIII--RESTORING PROVEN FINANCING FOR AMERICAN EMPLOYERS ACT Sec. 801. Rules of construction relating to collateralized loan obligations.

    TITLE IX--SBIC ADVISERS RELIEF ACT Sec. 901. Advisers of SBICs and venture capital funds.

    Sec. 902. Advisers of SBICs and private funds.

    Sec. 903. Relationship to State law.

    TITLE X--DISCLOSURE MODERNIZATION AND SIMPLIFICATION ACT Sec. 1001. Summary page for form 10-K.

    Sec. 1002. Improvement of regulation S-K.

    Sec. 1003. Study on modernization and simplification of regulation S-K.

    TITLE XI--ENCOURAGING EMPLOYEE OWNERSHIP ACT Sec. 1101. Increased threshold for disclosures relating to compensatory benefit plans.

    TITLE I--BUSINESS RISK MITIGATION AND PRICE STABILIZATION ACT SEC. 101. MARGIN REQUIREMENTS.

    (a) Commodity Exchange Act Amendment.--Section 4s(e) of the Commodity Exchange Act (7 U.S.C. 6s(e)), as added by section 731 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, is amended by adding at the end the following new paragraph: ``(4) Applicability with respect to counterparties.--The requirements of paragraphs (2)(A)(ii) and (2)(B)(ii), including the initial and variation margin requirements imposed by rules adopted pursuant to paragraphs (2)(A)(ii) and (2)(B)(ii), shall not apply to a swap in which a counterparty qualifies for an exception under section 2(h)(7)(A), or an exemption issued under section 4(c)(1) from the requirements of section 2(h)(1)(A) for cooperative entities as defined in such exemption, or satisfies the criteria in section 2(h)(7)(D).''.

    (b) Securities Exchange Act Amendment.--Section 15F(e) of the Securities Exchange Act of 1934 (15 U.S.C. 78o-10(e)), as added by section 764(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, is amended by adding at the end the following new paragraph: ``(4) Applicability with respect to counterparties.--The requirements of paragraphs (2)(A)(ii) and (2)(B)(ii) shall not apply to a security-based swap in which a counterparty qualifies for an exception under section 3C(g)(1) or satisfies the criteria in section 3C(g)(4).''.

    SEC. 102. IMPLEMENTATION.

    The amendments made by this title to the Commodity Exchange Act shall be implemented-- (1) without regard to-- (A) chapter 35 of title 44, United States Code; and (B) the notice and comment provisions of section 553 of title 5, United States Code; (2) through the promulgation of an interim final rule, pursuant to which public comment will be sought before a final rule is issued; and (3) such that paragraph (1) shall apply solely to changes to rules and regulations, or proposed rules and regulations, that are limited to and directly a consequence of such amendments.

    TITLE II--TREATMENT OF AFFILIATE TRANSACTIONS SEC. 201. TREATMENT OF AFFILIATE TRANSACTIONS.

    (a) In General.-- (1) Commodity exchange act amendment.--Section 2(h)(7)(D)(i) of the Commodity Exchange Act (7 U.S.C. 2(h)(7)(D)(i)) is amended to read as follows: ``(i) In general.--An affiliate of a person that qualifies for an exception under subparagraph (A) (including affiliate entities predominantly engaged in providing financing for the purchase of the merchandise or manufactured goods of the person) may qualify for the exception only if the affiliate enters into the swap to hedge or mitigate the commercial risk of the person or other affiliate of the person that is not a financial entity, provided that if the hedge or mitigation of such commercial risk is addressed by entering into a swap with a swap dealer or major swap participant, an appropriate credit support measure or other mechanism must be utilized.''.

    (2) Securities exchange act of 1934 amendment.--Section 3C(g)(4)(A) of the Securities Exchange Act of 1934 (15 U.S.C. 78c-3(g)(4)(A)) is amended to read as follows: ``(A) In general.--An affiliate of a person that qualifies for an exception under paragraph (1) (including affiliate entities predominantly engaged in providing financing for the purchase of the merchandise or manufactured goods of the person) may qualify for the exception only if the affiliate enters into the security-based swap to hedge or mitigate the commercial risk of the person or other affiliate of the person that is not a financial entity, provided that if the hedge [[Page H342]] or mitigation such commercial risk is addressed by entering into a security-based swap with a security-based swap dealer or major security-based swap participant, an appropriate credit support measure or other mechanism must be utilized.''.

    (b) Applicability of Credit Support Measure Requirement.-- The requirements in section 2(h)(7)(D)(i) of the Commodity Exchange Act and section 3C(g)(4)(A) of the Securities Exchange Act of 1934, as amended by subsection (a), requiring that a credit support measure or other mechanism be utilized if the transfer of commercial risk referred to in such sections is addressed by entering into a swap with a swap dealer or major swap participant or a security-based swap with a security-based swap dealer or major security-based swap participant, as appropriate, shall not apply with respect to swaps or security-based swaps, as appropriate, entered into before the date of the enactment of this Act.

    TITLE III--HOLDING COMPANY REGISTRATION THRESHOLD EQUALIZATION ACT SEC. 301. REGISTRATION THRESHOLD FOR SAVINGS AND LOAN HOLDING COMPANIES.

    The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is amended-- (1) in section 12(g)-- (A) in paragraph (1)(B), by inserting after ``is a bank'' the following: ``, a savings and loan holding company (as defined in section 10 of the Home Owners' Loan Act),''; and (B) in paragraph (4), by inserting after ``case of a bank'' the following: ``, a savings and loan holding company (as defined in section 10 of the Home Owners' Loan Act),''; and (2) in section 15(d), by striking ``case of bank'' and inserting the following: ``case of a bank, a savings and loan holding company (as defined in section 10 of the Home Owners' Loan Act),''.

    TITLE IV--SMALL BUSINESS MERGERS, ACQUISITIONS, SALES, AND BROKERAGE SIMPLIFICATION ACT SEC. 401. REGISTRATION EXEMPTION FOR MERGER AND ACQUISITION BROKERS.

    Section 15(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78o(b)) is amended by adding at the end the following: ``(13) Registration exemption for merger and acquisition brokers.-- ``(A) In general.--Except as provided in subparagraph (B), an M&A broker shall be exempt from registration under this section.

    ``(B) Excluded activities.--An M&A broker is not exempt from registration under this paragraph if such broker does any of the following: ``(i) Directly or indirectly, in connection with the transfer of ownership of an eligible privately held company, receives, holds, transmits, or has custody of the funds or securities to be exchanged by the parties to the transaction.

    ``(ii) Engages on behalf of an issuer in a public offering of any class of securities that is registered, or is required to be registered, with the Commission under section 12 or with respect to which the issuer files, or is required to file, periodic information, documents, and reports under subsection (d).

    ``(C) Rule of construction.--Nothing in this paragraph shall be construed to limit any other authority of the Commission to exempt any person, or any class of persons, from any provision of this title, or from any provision of any rule or regulation thereunder.

    ``(D) Definitions.--In this paragraph: ``(i) Control.--The term `control' means the power, directly or indirectly, to direct the management or policies of a company, whether through ownership of securities, by contract, or otherwise. There is a presumption of control for any person who-- ``(I) is a director, general partner, member or manager of a limited liability company, or officer exercising executive responsibility (or has similar status or functions); ``(II) has the right to vote 20 percent or more of a class of voting securities or the power to sell or direct the sale of 20 percent or more of a class of voting securities; or ``(III) in the case of a partnership or limited liability company, has the right to receive upon dissolution, or has contributed, 20 percent or more of the capital.

    ``(ii) Eligible privately held company.--The term `eligible privately held company' means a company that meets both of the following conditions: ``(I) The company does not have any class of securities registered, or required to be registered, with the Commission under section 12 or with respect to which the company files, or is required to file, periodic information, documents, and reports under subsection (d).

    ``(II) In the fiscal year ending immediately before the fiscal year in which the services of the M&A broker are initially engaged with respect to the securities transaction, the company meets either or both of the following conditions (determined in accordance with the historical financial accounting records of the company): ``(aa) The earnings of the company before interest, taxes, depreciation, and amortization are less than $25,000,000.

    ``(bb) The gross revenues of the company are less than $250,000,000.

    ``(iii) M&A broker.--The term `M&A broker' means a broker, and any person associated with a broker, engaged in the business of effecting securities transactions solely in connection with the transfer of ownership of an eligible privately held company, regardless of whether the broker acts on behalf of a seller or buyer, through the purchase, sale, exchange, issuance, repurchase, or redemption of, or a business combination involving, securities or assets of the eligible privately held company, if the broker reasonably believes that-- ``(I) upon consummation of the transaction, any person acquiring securities or assets of the eligible privately held company, acting alone or in concert, will control and, directly or indirectly, will be active in the management of the eligible privately held company or the business conducted with the assets of the eligible privately held company; and ``(II) if any person is offered securities in exchange for securities or assets of the eligible privately held company, such person will, prior to becoming legally bound to consummate the transaction, receive or have reasonable access to the most recent year-end balance sheet, income statement, statement of changes in financial position, and statement of owner's equity of the issuer of the securities offered in exchange, and, if the financial statements of the issuer are audited, the related report of the independent auditor, a balance sheet dated not more than 120 days before the date of the offer, and information pertaining to the management, business, results of operations for the period covered by the foregoing financial statements, and material loss contingencies of the issuer.

    ``(E) Inflation adjustment.-- ``(i) In general.--On the date that is 5 years after the date of the enactment of this paragraph, and every 5 years thereafter, each dollar amount in subparagraph (D)(ii)(II) shall be adjusted by-- ``(I) dividing the annual value of the Employment Cost Index For Wages and Salaries, Private Industry Workers (or any successor index), as published by the Bureau of Labor Statistics, for the calendar year preceding the calendar year in which the adjustment is being made by the annual value of such index (or successor) for the calendar year ending December 31, 2014; and ``(II) multiplying such dollar amount by the quotient obtained under subclause (I).

    ``(ii) Rounding.--Each dollar amount determined under clause (i) shall be rounded to the nearest multiple of $100,000.''.

    SEC. 402. EFFECTIVE DATE.

    This Act and any amendment made by this Act shall take effect on the date that is 90 days after the date of the enactment of this Act.

    TITLE V--SWAP DATA REPOSITORY AND CLEARINGHOUSE INDEMNIFICATION CORRECTIONS SEC. 501. REPEAL OF INDEMNIFICATION REQUIREMENTS.

    (a) Derivatives Clearing Organizations.--Section 5b(k)(5) of the Commodity Exchange Act (7 U.S.C. 7a-1(k)(5)) is amended to read as follows: ``(5) Confidentiality agreement.--Before the Commission may share information with any entity described in paragraph (4), the Commission shall receive a written agreement from each entity stating that the entity shall abide by the confidentiality requirements described in section 8 relating to the information on swap transactions that is provided.''.

    (b) Swap Data Repositories.--Section 21(d) of the Commodity Exchange Act (7 U.S.C. 24a(d)) is amended to read as follows: ``(d) Confidentiality Agreement.--Before the swap data repository may share information with any entity described in subsection (c)(7), the swap data repository shall receive a written agreement from each entity stating that the entity shall abide by the confidentiality requirements described in section 8 relating to the information on swap transactions that is provided.''.

    (c) Security-Based Swap Data Repositories.--Section 13(n)(5)(H) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(n)(5)(H)) is amended to read as follows: ``(H) Confidentiality agreement.--Before the security-based swap data repository may share information with any entity described in subparagraph (G), the security-based swap data repository shall receive a written agreement from each entity stating that the entity shall abide by the confidentiality requirements described in section 24 relating to the information on security-based swap transactions that is provided.''.

    (d) Effective Date.--The amendments made by this Act shall take effect as if enacted as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Public Law 111- 203) on July 21, 2010.

    TITLE VI--IMPROVING ACCESS TO CAPITAL FOR EMERGING GROWTH COMPANIES ACT SEC. 601. FILING REQUIREMENT FOR PUBLIC FILING PRIOR TO PUBLIC OFFERING.

    Section 6(e)(1) of the Securities Act of 1933 (15 U.S.C. 77f(e)(1)) is amended by striking ``21 days'' and inserting ``15 days''.

    SEC. 602. GRACE PERIOD FOR CHANGE OF STATUS OF EMERGING GROWTH COMPANIES.

    Section 6(e)(1) of the Securities Act of 1933 (15 U.S.C. 77f(e)(1)) is further amended by adding at the end the following: ``An issuer that was an emerging growth company at the time it submitted a confidential registration statement or, in lieu thereof, a publicly filed registration statement for review under this subsection but ceases to be an emerging growth company thereafter shall continue to be treated as an emerging market growth company for the purposes of this subsection through the earlier of the date on which the issuer consummates its initial [[Page H343]] public offering pursuant to such registrations statement or the end of the 1-year period beginning on the date the company ceases to be an emerging growth company.''.

    SEC. 603. SIMPLIFIED DISCLOSURE REQUIREMENTS FOR EMERGING GROWTH COMPANIES.

    Section 102 of the Jumpstart Our Business Startups Act (Public Law 112-106) is amended by adding at the end the following: ``(d) Simplified Disclosure Requirements.--With respect to an emerging growth company (as such term is defined under section 2 of the Securities Act of 1933): ``(1) Requirement to include notice on form s-1.--Not later than 30 days after the date of enactment of this subsection, the Securities and Exchange Commission shall revise its general instructions on Form S-1 to indicate that a registration statement filed (or submitted for confidential review) by an issuer prior to an initial public offering may omit financial information for historical periods otherwise required by regulation S-X (17 C.F.R. 210.1-01 et seq.) as of the time of filing (or confidential submission) of such registration statement, provided that-- ``(A) the omitted financial information relates to a historical period that the issuer reasonably believes will not be required to be included in the Form S-1 at the time of the contemplated offering; and ``(B) prior to the issuer distributing a preliminary prospectus to investors, such registration statement is amended to include all financial information required by such regulation S-X at the date of such amendment.

    ``(2) Reliance by issuers.--Effective 30 days after the date of enactment of this subsection, an issuer filing a registration statement (or submitting the statement for confidential review) on Form S-1 may omit financial information for historical periods otherwise required by regulation S-X (17 C.F.R. 210.1-01 et seq.) as of the time of filing (or confidential submission) of such registration statement, provided that-- ``(A) the omitted financial information relates to a historical period that the issuer reasonably believes will not be required to be included in the Form S-1 at the time of the contemplated offering; and ``(B) prior to the issuer distributing a preliminary prospectus to investors, such registration statement is amended to include all financial information required by such regulation S-X at the date of such amendment.''.

    TITLE VII--SMALL COMPANY DISCLOSURE SIMPLIFICATION ACT SEC. 701. EXEMPTION FROM XBRL REQUIREMENTS FOR EMERGING GROWTH COMPANIES AND OTHER SMALLER COMPANIES.

    (a) Exemption for Emerging Growth Companies.--Emerging growth companies are exempted from the requirements to use Extensible Business Reporting Language (XBRL) for financial statements and other periodic reporting required to be filed with the Commission under the securities laws. Such companies may elect to use XBRL for such reporting.

    (b) Exemption for Other Smaller Companies.--Issuers with total annual gross revenues of less than $250,000,000 are exempt from the requirements to use XBRL for financial statements and other periodic reporting required to be filed with the Commission under the securities laws. Such issuers may elect to use XBRL for such reporting. An exemption under this subsection shall continue in effect until-- (1) the date that is five years after the date of enactment of this Act; or (2) the date that is two years after a determination by the Commission, by order after conducting the analysis required by section 702, that the benefits of such requirements to such issuers outweigh the costs, but no earlier than three years after enactment of this Act.

    (c) Modifications to Regulations.--Not later than 60 days after the date of enactment of this Act, the Commission shall revise its regulations under parts 229, 230, 232, 239, 240, and 249 of title 17, Code of Federal Regulations, to reflect the exemptions set forth in subsections (a) and (b).

    SEC. 702. ANALYSIS BY THE SEC.

    The Commission shall conduct an analysis of the costs and benefits to issuers described in section 701(b) of the requirements to use XBRL for financial statements and other periodic reporting required to be filed with the Commission under the securities laws. Such analysis shall include an assessment of-- (1) how such costs and benefits may differ from the costs and benefits identified by the Commission in the order relating to interactive data to improve financial reporting (dated January 30, 2009; 74 Fed. Reg. 6776) because of the size of such issuers; (2) the effects on efficiency, competition, capital formation, and financing and on analyst coverage of such issuers (including any such effects resulting from use of XBRL by investors); (3) the costs to such issuers of-- (A) submitting data to the Commission in XBRL; (B) posting data on the website of the issuer in XBRL; (C) software necessary to prepare, submit, or post data in XBRL; and (D) any additional consulting services or filing agent services; (4) the benefits to the Commission in terms of improved ability to monitor securities markets, assess the potential outcomes of regulatory alternatives, and enhance investor participation in corporate governance and promote capital formation; and (5) the effectiveness of standards in the United States for interactive filing data relative to the standards of international counterparts.

    SEC. 703. REPORT TO CONGRESS.

    Not later than one year after the date of enactment of this Act, the Commission shall provide the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate a report regarding-- (1) the progress in implementing XBRL reporting within the Commission; (2) the use of XBRL data by Commission officials; (3) the use of XBRL data by investors; (4) the results of the analysis required by section 702; and (5) any additional information the Commission considers relevant for increasing transparency, decreasing costs, and increasing efficiency of regulatory filings with the Commission.

    SEC. 704. DEFINITIONS.

    As used in this title, the terms ``Commission'', ``emerging growth company'', ``issuer'', and ``securities laws'' have the meanings given such terms in section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c).

    TITLE VIII--RESTORING PROVEN FINANCING FOR AMERICAN EMPLOYERS ACT SEC. 801. RULES OF CONSTRUCTION RELATING TO COLLATERALIZED LOAN OBLIGATIONS.

    Section 13(c)(2) of the Bank Holding Company Act of 1956 (12 U.S.C. 1851(c)(2)) is amended-- (1) by striking ``A banking entity or nonbank financial company supervised by the Board'' and inserting the following: ``(A) General conformance period.--A banking entity or nonbank financial company supervised by the Board''; and (2) by adding at the end the following: ``(B) Conformance period for certain collateralized loan obligations.-- ``(i) In general.--Notwithstanding subparagraph (A), a banking entity or nonbank financial company supervised by the Board shall bring its activities related to or investments in a debt security of a collateralized loan obligation issued before January 31, 2014, into compliance with the requirements of subsection (a)(1)(B) and any applicable rules relating to subsection (a)(1)(B) not later than July 21, 2019.

    ``(ii) Collateralized loan obligation.--For purposes of this subparagraph, the term `collateralized loan obligation' means any issuing entity of an asset-backed security, as defined in section 3(a)(77) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(77)), that is comprised primarily of commercial loans.''.

    TITLE IX--SBIC ADVISERS RELIEF ACT SEC. 901. ADVISERS OF SBICS AND VENTURE CAPITAL FUNDS.

    Section 203(l) of the Investment Advisers Act of 1940 (15 U.S.C. 80b-3(l)) is amended-- (1) by striking ``No investment adviser'' and inserting the following: ``(1) In general.--No investment adviser''; and (2) by adding at the end the following: ``(2) Advisers of sbics.--For purposes of this subsection, a venture capital fund includes an entity described in subparagraph (A), (B), or (C) of subsection (b)(7) (other than an entity that has elected to be regulated or is regulated as a business development company pursuant to section 54 of the Investment Company Act of 1940).''.

    SEC. 902. ADVISERS OF SBICS AND PRIVATE FUNDS.

    Section 203(m) of the Investment Advisers Act of 1940 (15 U.S.C. 80b-3(m)) is amended by adding at the end the following: ``(3) Advisers of sbics.--For purposes of this subsection, the assets under management of a private fund that is an entity described in subparagraph (A), (B), or (C) of subsection (b)(7) (other than an entity that has elected to be regulated or is regulated as a business development company pursuant to section 54 of the Investment Company Act of 1940) shall be excluded from the limit set forth in paragraph (1).''.

    SEC. 903. RELATIONSHIP TO STATE LAW.

    Section 203A(b)(1) of the Investment Advisers Act of 1940 (15 U.S.C. 80b-3a(b)(1)) is amended-- (1) in subparagraph (A), by striking ``or'' at the end; (2) in subparagraph (B), by striking the period at the end and inserting ``; or''; and (3) by adding at the end the following: ``(C) that is not registered under section 203 because that person is exempt from registration as provided in subsection (b)(7) of such section, or is a supervised person of such person.''.

    TITLE X--DISCLOSURE MODERNIZATION AND SIMPLIFICATION ACT SEC. 1001. SUMMARY PAGE FOR FORM 10-K.

    Not later than the end of the 180-day period beginning on the date of the enactment of this Act, the Securities and Exchange Commission shall issue regulations to permit issuers to submit a summary page on form 10-K (17 C.F.R. 249.310), but only if each item on such summary page includes a cross- reference (by electronic link or otherwise) to the material contained in form 10-K to which such item relates.

    SEC. 1002. IMPROVEMENT OF REGULATION S-K.

    Not later than the end of the 180-day period beginning on the date of the enactment of [[Page H344]] this Act, the Securities and Exchange Commission shall take all such actions to revise regulation S-K (17 C.F.R. 229.10 et seq.)-- (1) to further scale or eliminate requirements of regulation S-K, in order to reduce the burden on emerging growth companies, accelerated filers, smaller reporting companies, and other smaller issuers, while still providing all material information to investors; (2) to eliminate provisions of regulation S-K, required for all issuers, that are duplicative, overlapping, outdated, or unnecessary; and (3) for which the Commission determines that no further study under section 1003 is necessary to determine the efficacy of such revisions to regulation S-K.

    SEC. 1003. STUDY ON MODERNIZATION AND SIMPLIFICATION OF REGULATION S-K.

    (a) Study.--The Securities and Exchange Commission shall carry out a study of the requirements contained in regulation S-K (17 C.F.R. 229.10 et seq.). Such study shall-- (1) determine how best to modernize and simplify such requirements in a manner that reduces the costs and burdens on issuers while still providing all material information; (2) emphasize a company by company approach that allows relevant and material information to be disseminated to investors without boilerplate language or static requirements while preserving completeness and comparability of information across registrants; and (3) evaluate methods of information delivery and presentation and explore methods for discouraging repetition and the disclosure of immaterial information.

    (b) Consultation.--In conducting the study required under subsection (a), the Commission shall consult with the Investor Advisory Committee and the Advisory Committee on Small and Emerging Companies.

    (c) Report.--Not later than the end of the 360-day period beginning on the date of enactment of this Act, the Commission shall issue a report to the Congress containing-- (1) all findings and determinations made in carrying out the study required under subsection (a); (2) specific and detailed recommendations on modernizing and simplifying the requirements in regulation S-K in a manner that reduces the costs and burdens on companies while still providing all material information; and (3) specific and detailed recommendations on ways to improve the readability and navigability of disclosure documents and to discourage repetition and the disclosure of immaterial information.

    (d) Rulemaking.--Not later than the end of the 360-day period beginning on the date that the report is issued to the Congress under subsection (c), the Commission shall issue a proposed rule to implement the recommendations of the report issued under subsection (c).

    (e) Rule of Construction.--Revisions made to regulation S-K by the Commission under section 1002 shall not be construed as satisfying the rulemaking requirements under this section.

    TITLE XI--ENCOURAGING EMPLOYEE OWNERSHIP ACT SEC. 1101. INCREASED THRESHOLD FOR DISCLOSURES RELATING TO COMPENSATORY BENEFIT PLANS.

    Not later than 60 days after the date of the enactment of this Act, the Securities and Exchange Commission shall revise section 230.701(e) of title 17, Code of Federal Regulations, so as to increase from $5,000,000 to $10,000,000 the aggregate sales price or amount of securities sold during any consecutive 12-month period in excess of which the issuer is required under such section to deliver an additional disclosure to investors. The Commission shall index for inflation such aggregate sales price or amount every 5 years to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, rounding to the nearest $1,000,000.

    The SPEAKER pro tempore (Mr. Smith of Nebraska). Pursuant to House Resolution 27, the gentleman from Texas (Mr. Hensarling) and the gentlewoman from California (Ms. Maxine Waters) each will control 30 minutes.

    The Chair recognizes the gentleman from Texas.

    General Leave Mr. HENSARLING. Mr. Speaker, I ask unanimous consent that all Members have 5 legislative days within which to revise and extend their remarks and include extraneous materials on H.R. 37, currently under consideration.

    The SPEAKER pro tempore. Is there objection to the request of the gentleman from Texas? There was no objection.

    Mr. HENSARLING. Mr. Speaker, I yield myself such time as I may consume.

    Mr. Speaker, for the sake of the American people, for the sake of all of those who are underemployed, who are unemployed still today in this economy, let us hope that the third time is the charm.

    The bill that is before us today, substantially authored by the gentleman from Pennsylvania (Mr. Fitzpatrick), the Promoting Job Creation and Reducing Small Business Burdens Act, was on the floor in a substantially identical version in the 113th Congress.

    This bill, to ease the burdens on small businesses, on job creators to help foster capital creation, so that people can be put back to work, so that people can have good careers, so that people can pay their mortgages and pay their health care premiums, substantially in the same form passed in the last Congress 320-102; regrettably then, the United States Senate, under Democrat control, took up no portion of the bill.

    It was last week that a slightly different version of the bill was brought to this House floor under what we know as our suspension calendar, which is reserved for bills that typically enjoy broad bipartisan support; regrettably, it proved to be about a dozen votes short because a number of my friends from the other side of the aisle apparently decided that they were for the bill before they were against the bill. They changed their minds in approximately 7 days.

    Now, Mr. Speaker, this is a very simple bill. There were 11 different modest provisions, all of which enjoyed broad bipartisan support, again which were modest, modest attempts to ensure that small businesses could still survive in an otherwise onerous Washington regulatory climate.

    Mr. Speaker, we had a bill that, even combined--and it is quite common for us to roll up bills for the sake of efficiency, bills that are quite similar in nature--was 30 pages long. Not 300, not 3,000--it wasn't the 2,000 pages of ObamaCare, not the 2,000 pages of Dodd- Frank--it was merely 30 pages.

    Now, what is included in this bill? Well, included in this bill is H.R. 634, which passed this body 411-12. It includes H.R. 5471, which passed the House by voice vote, not a dissenting vote that I recall. It includes H.R. 801 that passed the House 417-4. It includes H.R. 2274, the bill that passed the House 422-0.

    I could go on and on, but of the bills that are rolled up to ensure greater capital formation and regulatory relief for our smaller business enterprises, all of these passed either the committee or the House with overwhelming bipartisan support, and now--now--the minority is coming to this floor and somehow crying foul. Again, many were for it before they were against it.

    I don't know how we can look our constituents in the eyes and know that, even today, they continue to suffer in this economy and not do something to help them.

    What this is really all about, Mr. Speaker, is there is a division. There is a division within the Democrat Party. According to press reports, some Democrats have reportedly told their fellow Democrats that if they dare to vote for a bill that makes a clarification or modification to Dodd-Frank, they aren't real Democrats.

    It is interesting that yesterday, President Obama signed into law a modification of Dodd-Frank. I know the President is not a Republican, but according to some Democrats, apparently by signing a modification to Dodd-Frank, he is not apparently a Democrat, either, so I am not really sure what he is.

    It is fascinating that a former chairman, Barney Frank, of the House Financial Services Committee, one of my predecessors, in previous testimony before our committee, indicated a number of changes to Dodd- Frank that he thought would be proper, so according to some Democrats, apparently Barney Frank is no longer a Democrat, either.

    What this is really getting at, Mr. Speaker, is of the 11 bills that are rolled up into this 30-page document, some of them either clarify or modify provisions of Dodd-Frank, and for some Members of the Democratic Party, apparently, Dodd-Frank has now been elevated beyond ideology to religion, and there can be no changes in a 2,000-page bill that we know is fraught with unintended consequences.

    Yet there are some on the other side of the aisle that say, ``no changes, no changes,'' yet President Obama signed a change into law. Former Chairman Frank has indicated a number of changes he would consider.

    It is time to get beyond the religion. It is time to get beyond the ideology. It is time to get America back to work. It is time to start growing this economy [[Page H345]] from Main Street up, not Washington down, because that is not working, Mr. Speaker.

    It is time to do what everybody claims they want to do, and that is work on a bipartisan basis. All of these bills passed with overwhelming bipartisan majorities, and now, because of this almost religious zeal for the Dodd-Frank brand, again, some of my Democratic colleagues have decided that they were for it before they were against it.

    It is time to put America back to work. It is time to enact H.R. 37, Promoting Job Creation and Reducing Small Business Burdens Act. Let's make sure the third time is the charm.

    I reserve the balance of my time.

    Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself such time as I may consume.

    Mr. Speaker, if at first you don't succeed, try, try again. Usually, we tell that saying to children to encourage them to achieve greater things, but it seems that when it comes to Congress, it is what Wall Street keeps telling House Republicans.

    Mr. Speaker, Republicans thought they could sneak this bill by last week through a fast-track process on the House floor, a process with limited debate and no opportunity for amendments. They thought they could ram through this gift to a handful of the biggest Wall Street banks on just the 2nd day of this new Congress right after we had reconvened.

    Well, the American people were watching, and the Democrats here in the House told them ``no.'' The Republican bill failed. Now, here they are; they are at it again. Now, H.R. 37 is back on the floor again, without the opportunity to amend it and with limited debate.

    {time} 2015 The only difference is that Republicans have reduced how many votes are needed to guarantee passage. That's right. Rather than fix the bill to win broad support, Republicans just changed the rule to make sure the tainted bill passes.

    And what does this bill do? Well, for one, it takes a part of Wall Street reform's Volcker rule and delays it for yet another 2 years. Remember that the Volcker rule is the part of Dodd-Frank that stops government-supported banks from gambling with bank depositors' money. And this extra 2-year delay comes on top of a 3-year delay that our regulators carefully crafted to ease the megabanks' transition.

    This particular part of the law that Republicans want to see delayed applies to what are known as collateralized loan obligations, or CLOs. CLOs are bundles of leveraged loans, loans often issued by private equity firms to facilitate corporate buyouts that can harm American jobs. The loans are sliced and diced into packages and sold off to investors, including banks that hold customers' deposits. The packages often also contain credit default swaps or other derivatives that can make the position even riskier.

    Somehow, Wall Street bankers--the supposedly smartest people in the room--can't seem to comply with a law passed in 2010 by--that's right-- 2017. Seven long years isn't enough. The Republicans and the banks want nearly a decade.

    In addition to that, the Republican bill wouldn't just let the banks hold on to these CLOs. The bill would let the banks accumulate new CLOs also. That's right. The banks could actively trade in and out of these investments, unlike the rules carefully crafted by the Federal Reserve.

    We saw the Republican playbook at the end of last year with the so- called swaps push-out rule. They hope they can jam these bills through Congress by attaching them to must-pass legislation. And most of all, they hope these issues are way too complicated or too technical for the American people to understand or care about. But the American people really do understand. They remember how our economy was nearly brought to its knees in 2008, and they recognize that we can't let Wall Street slowly chip away at reforms designed to prevent that kind of large- scale financial crisis from happening again.

    And President Obama gets it, too. That is why the White House said he would veto this legislation if it got to his desk. And so one cannot help but wonder why are we here on the floor after 8 o'clock in the evening with an attempt to push through something that was jammed into a package of bills? Many of those bills had been heard either in committee or on the floor, but one portion of this bill had not. And so is this simply an attempt to ram down one segment that they fear real debate on, ram it down the throats of the Members of this Legislature and the citizens of this country, hiding it in this package, hoping that we won't get it? What is worse is that this legislation has been brought to the floor without regard for any regular order. The nine new members on the Financial Services Committee will not get a chance to hear testimony on it at all. And in just the 2nd week of their term, 52 new Members of the House are expected to vote on it, having complicated deregulation shoved down their throats. Democrats offered 13 amendments, one of them bipartisan, but none of these amendments will be considered or debated. Why? Because my colleagues on the other side are not interested in legislation but, rather, in political theater.

    We cannot let this casual disregard for the legislative process stand. We want to see reforms sensibly implemented. We want to work with regulators to get the rules right, and we want our largest banks to stop gambling and go back to facilitating growth in the real economy. But that is difficult to do when my Republican counterparts continue pushing legislation that masquerades as technical fixes but really makes substantive changes to the Dodd-Frank reform law. And then they package completely reckless legislation with other provisions that are either necessary or sensible.

    Democrats know better, President Obama knows better, and the American people know better. So I would urge my colleagues to vote ``no'' on this bill.

    Mr. Speaker, I reserve the balance of my time.

    Mr. HENSARLING. Mr. Speaker, I yield myself 20 seconds to say that this highly controversial bill that the ranking member alludes to passed on the House floor by voice vote, and this particular financing helps companies like Dunkin' Donuts, American Airlines, Burger King, and Goodyear Tire put people to work in America--hardly Wall Street. The head of the Independent Community Bankers has said it is necessary to protect community banks, and that is why we are here today.

    Mr. Speaker, I am now happy to yield 3 minutes to the gentleman from Georgia (Mr. Austin Scott) on behalf of the Agriculture Committee, which shares jurisdiction on this bill.

    Mr. AUSTIN SCOTT of Georgia. Mr. Speaker, I rise in support of H.R. 37, the Promoting Job Creation and Reducing Small Business Burdens Act. As chairman of the Agriculture Subcommittee on Commodity Exchanges, Energy and Credit, I specifically want to highlight and voice my support for the past work of the Agriculture Committee on the three titles of this bill that we worked on.

    First of all, title I of this bill, the Business Risk Mitigation and Price Stabilization Act, will provide much-needed relief to American farmers, businesses, and job creators who rely on derivatives to manage the risk inherent in the daily operation of their farms and businesses. It will do so by reinforcing congressional intent that those market participants who have been exempted from clearing their trades are also exempted from corresponding margin requirements.

    These exemptions make sure that end users do not have to divert working capital to margin requirements, thus keeping those dollars at work in the economy. I am pleased that this provision was included in this package, as well as in the TRIA authorization that was recently approved by both the House and the Senate.

    Also under the Ag Committee's jurisdiction is title II of H.R. 37, pertaining to the treatment of interaffiliate transactions. This well- reasoned provision was passed by the Congress multiple times in the 113th Congress and also will prevent the tie-up of working capital. It will do so by ensuring that transactions between affiliates within [[Page H346]] a single corporate group are not regulated as swaps.

    If such transactions are subject to the same regulations as swaps, companies could be subject to double margin requirements. Since interaffiliate swaps pose no systemic risk to the economy or the marketplace, such redundant regulation would provide no additional risk reduction while substantially raising costs that would ultimately be passed on to the consumers. Title II of H.R. 37 will prevent that misguided regulatory scheme and allow American businesses to continue utilizing their established and efficient centralized trading models.

    Finally, the corrections made by title V of H.R. 37 will ensure that regulators and market participants have access to a global set of swap market data.

    Dodd-Frank currently requires indemnification agreements from foreign regulators requesting information from U.S. swap data repositories or derivatives clearing organizations. These agreements state that the foreign regulator will abide by certain confidentiality requirements and indemnify the U.S. Commission for any expenses arising from litigation relating to the request for information.

    Unfortunately, the concept of indemnification does not exist in many foreign jurisdictions. As such, some foreign regulators cannot agree to these indemnification requirements. This may hinder our ability to make a workable data-sharing arrangement with those regulators and ultimately fragment the marketplace by encouraging them to establish their own data repositories. H.R. 37 narrowly addresses this potential data-sharing problem by simply removing the indemnification requirements from current law. Existing provisions requiring certain confidentiality obligations will remain in place.

    Mr. Speaker, I would like to thank Mr. Fitzpatrick for working to include these provisions in today's bill. I strongly encourage my colleagues to support this legislative package aimed at reducing regulatory burdens and promoting economic growth.

    Ms. MAXINE WATERS of California. Mr. Speaker, I yield 5 minutes to the distinguished gentleman from Massachusetts (Mr. Lynch).

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