Oct. 29, 2023
The proposed rule doesn't consider: 1. Unintended consequences - Implementing a new regulation might have unanticipated negative impacts on market players or consumers. These outcomes may not be apparent until after the rules are in place, and they can often be difficult to reverse once implemented. 2. Cost of compliance - The cost of implementing and maintaining regulatory requirements could be high for some companies, leading to reduced profitability, job losses, or other negative impacts on their businesses. This is especially true for smaller companies that might not have the resources to bear these costs. 3. Increased complexity - Regulations can add layers of complication and bureaucracy that make it harder for investors and industry participants to understand what they must do, leading to confusion and potential missteps. 4. Impact on innovation - New regulations might stifle the development or adoption of new technologies, products, or services by making them more expensive or difficult to implement. This could result in reduced competition within an industry. 5. Regulatory capture - There is a risk that regulators may become too closely aligned with the interests they are meant to regulate, leading to rules that favor certain companies over others. 6. Unnecessary restrictions on business activities - Some proposed rules might limit legitimate and beneficial business practices without providing any real benefit to consumers or investors. This could hinder economic growth and job creation in affected industries. 7. Lack of flexibility - New regulations may not allow for enough flexibility in how they are implemented, leading to one-size-fits-all solutions that do not address the unique needs of different businesses or markets. 8. Increased market volatility - Some proposed rules could lead to increased market uncertainty and volatility as investors try to understand their impact on various industries or companies. This can make it harder for people to plan for retirement, save for college, or otherwise manage their finances effectively. 9. Impact on global competitiveness - New regulations might put U.S.-based firms at a disadvantage compared with foreign counterparts who are not subject to the same requirements. This could lead to an exodus of jobs and investment from American companies seeking more favorable regulatory environments abroad. 10. Impact on small businesses - Small businesses might be particularly hard hit by new regulations, as they often lack the resources or expertise needed to comply with complex requirements. This could lead to consolidation within an industry and reduced competition overall.