Sunday, August 17, 2014

Hopes Fading for Dodd-Frank Act Corrections Bill in 113th Congress

It is becoming increasingly apparent that a Dodd-Frank corrections bill is not going to be enacted by the 113th Congress, even though the House has passed a number of Dodd-Frank stand-alone corrections pieces of legislation by overwhelmingly bi-partisan majorities. For example, the House passed the Swap Data Repository and Clearinghouse Indemnification Correction Act, H.R. 742, by a vote of 420 to 2, which would remove an indemnification requirement imposed on foreign regulators as a condition of obtaining access to data repositories. Also, the House passed the Business Risk Mitigation and Price Stabilization Act. H.R. 634, to exempt non-financial derivatives end users from the margin requirements of Dodd-Frank by a vote of 411 to 12. But the Senate has not taken up these bills.

What began with such hope with Senate Banking Committee member Mark Warner (D-VA) telling the Bipartisan Policy Center that the 113th Congress should consider major Dodd-Frank Act corrections legislation, seems to be heading for a dismal end. While Dodd-Frank broadly got things directionally right, said Senator Warner, historically, with any major piece of federal legislation, Congress never gets it entirely right the first time.

There are not many legislative days left in the 113th Congress to get this done. When Congress returns in September, there is likely to be a session of only about three weeks before a break for the elections. Even if there is a lame duck session after the elections, enactment of a Dodd-Frank corrections bill during it are unlikely.