In a vote of 254-159, the House of Representatives has passed a measure to remove provisions from the Dodd-Frank law that would require private equity firms to register with the Securities and Exchange Commission.
Under the current rules, private-equity funds would be required to register with the SEC if they were responsible for more than $150 million in assets under management. This requirement was designed to keep investors safe and offer transparency for clients.
The House measure was solidified in a bi-partisan vote with 36 Democrats and 218 Republicans in favor of the exemption. However, the motion still has considerable hurdles to overcome. There is no similar measure currently pending in the Senate, and the White House has released statements indicating that President Barrack Obama would veto the measure should the opportunity arise.
"The bill's passage would deny investors access to important information intended to increase transparency and accountability and to minimize conflicts of interest," the White House said in a statement.
Proponents of the measure say that current rules stifle job creation and claim that smaller private equity firms did not contribute to the financial crisis. The Dodd-Frank Act is intended to reduce the risk of another financial crisis.
"At a time when the capital small businesses need to grow and thrive is already difficult to come by, we must make it easier for our Main Street businesses to access these vital resources and create jobs," said Rep. Robert Hurt (R., Va.), reports the Wall Street Journal.
Lawmakers have previously attempted to appeal provisions of Dodd-Frank, but the White House has stated it will not consider adjustments until regulators have nailed-down all of its current needs.
Check out InsideCounsel’s coverage of Dodd-Frank developments: