News Column

Statement of Congressman Chris Van Hollen (D-MD) in opposition to The Consumer Protection and End-User Relief Act (HR 4413)

June 25, 2014



WASHINGTON, June 25 -- Rep. Chris Van Hollen, D-Md. (8th CD), issued the following speech:

Mr. Speaker, I support reauthorizing the Commodity Futures Trading Commission (CFTC) and believe a properly resourced CFTC has a critical role to play in promoting fair and transparent markets that effectively serve end users and consumers without putting taxpayers or our financial system at risk. Unfortunately, HR 4413 departs from this vital objective in several important ways.

First, Title II of HR 4413 imposes onerous new administrative burdens on the CFTC whose practical effect will be to delay the Commission's ongoing Dodd-Frank rulemaking and encourage costly litigation. We need more certainty - not less certainty - when it comes to regulating our derivatives markets, and HR 4413 would take us in precisely the opposite direction.

Second, Title III of HR 4413 would make it much more difficult for the CFTC to regulate cross-border derivatives transactions that pose a risk to the U.S. economy. The legislation creates this vulnerability by substituting foreign derivatives rules for U.S. law unless the CFTC and the Securities and Exchange Commission (SEC) jointly determine that a foreign country's regulatory regime is not broadly equivalent to our own. While I support international efforts to harmonize effective rules of the road for derivatives transactions, I do not support presuming an equivalency in this area that does not currently exist. Six years after unregulated derivatives transactions contributed to the sharpest downturn in our economy since the Great Depression, we simply cannot afford to outsource the protection of our financial system to foreign regulators.

Third, neither this legislation ? nor the FY 2015 House Agriculture-FDA Appropriations bill, which proposes to slash the CFTC's budget by 22 percent below the President's request ? does anything to provide the CFTC with the resources it needs to police fraud and excessive speculation in our derivatives markets on behalf of end users and consumers.

For these reasons, I urge a no vote on HR 4413, and I yield back the balance of my time.

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