Mar. 15, 2023
Dear Sir/Madam, As a retail investor concerned with market stability, market manipulation, market efficiency, and transparency, I am writing to express my opinion on the proposed rule. I believe that there should be no exceptions or exemptions to the proposed rule under any circumstance, in order to ensure market stability, prevent market manipulation, and maintain market efficiency and transparency. Regarding the scope of the proposed risk-mitigating hedging activities exception, I believe it should not be expanded or contracted, as any modification might provide an opportunity for abuse or evasion. I think it is crucial to maintain strict adherence to the conditions proposed. In terms of the proposed conditions, I think they should not be modified to align more closely with market-making in the context of Regulation SHO. The purposes of the proposed rule and Regulation SHO are different, and any modifications may weaken investor protection. Concerning the proposed exception for liquidity commitments, the term "commitment" should be defined more narrowly to prevent potential abuse. The proposed exception should not apply to activities other than purchases and sales of the ABS. Expanding the exception to other activities could create opportunities for manipulation and abuse. The Commission should require that a commitment be evidenced by a contractual obligation to improve transparency and accountability in the market. In response to the proposed bona fide market-making activities exception, I must emphasize that no exceptions should be accepted. While it is important to consider genuine market-making activities, the inclusion of any exception could potentially lead to conflicts of interest or compromise investor protection. Although considering liquidity, maturity, and depth of the market in determining whether a securitization participant routinely stands ready to purchase and sell financial instruments might be relevant, I believe it is more important to prioritize a consistent regulatory framework. As such, it is crucial that the rule incorporates sufficient safeguards to prevent misuse and evasion, with a robust anti-circumvention provision in proposed Rule 192(d) to address any concerns about potential misuse or evasion. Regarding the compensation condition, I believe it should provide additional specificity to ensure that compensation arrangements do not reward or incentivize conflicted transactions. Clear metrics and examples of acceptable and unacceptable compensation arrangements would be helpful for compliance purposes. In conclusion, I firmly believe that any exceptions or exemptions to the proposed rule would undermine its purpose and potentially lead to abuse. As a retail investor, I strongly advocate for a comprehensive and consistent regulatory framework without exceptions to maintain market stability, prevent market manipulation, and promote transparency. Thank you for the opportunity to provide my input on this important matter. Sincerely, Mikkel Baumann-Jørgensen