The U.S. House of Representatives on January 14, 2015, voted (271-154) to pass H.R. 37, the “Promoting Job Creation and Reducing Small Business Burdens Act.” If enacted, the bill, among other things, would extend the Volcker Rule conformance date for collateralized loan obligations (CLOs) and ease requirements for investment advisers of small business investment companies (SBICs) and venture capital firms. The bill also includes a number of measures that correct issues arising in the JOBS Act, or that otherwise are intended to promote capital formation.
Rep. Jeb Hensarling of Texas championed this bill as beginning to “get America back to work” and start growing the economy. He said that the bill corrects some “unintended consequences” of the 2,000 page Dodd-Frank Act.
Democrats, as expected, were critical of the bill. Rep. Maxine Waters said that the bill was intended to delay the effect of the Volcker Rule, which was designed to stop “government-supported banks from gambling with bank depositors’ money.”
Our take. It is encouraging to see action to reduce regulatory burden. H.R. 37 is only a small step, and there are other aspects of the Dodd-Frank Act that Congress or the regulators should reconsider.
A more complete analysis of the bill can be found in our client alert, available here.