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SEC Considers Changes to Trump-Era Rules

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The U.S. Securities and Exchange Commission said it would consider changes to regulations passed under the Trump administration, a move that drew criticism from its Republican commissioners.

Among the regulations that the SEC plans to revisit are amendments to its whistleblower award program and a rule requiring oil, gas and mining companies to disclose payments made to foreign governments. Both rules were passed late last year over opposition by the agency’s Democrats.

The decision to revisit the rules is part of the SEC’s latest regulatory agenda, released on Friday. In addition to reviewing a number of Trump-era rules, the agency said it would draft rules on environmental, social and governance-related investing, and on disclosures by companies on cybersecurity risks.

On Monday, the SEC’s two Republican commissioners criticized the agenda for reopening the rule-making process on already completed regulations, and for not tackling other issues, like clarifying the agency’s oversight of digital assets.

“Perhaps the absence of these rules is attributable to the regrettable decision to spend our scarce resources to undo a number of rules the commission just adopted,” commissioners

Hester Peirce

and

Elad Roisman

said.

Democratic commissioners

Allison Herren Lee

and

Caroline Crenshaw

voted against the whistleblower award and extractive industries rules last year, while then Chairman

Jay Clayton

voted in support along with Ms. Peirce and Mr. Roisman.

Gary Gensler

took over as SEC chief this year.

Mses. Lee and Crenshaw and Mr. Gensler didn’t immediately respond to requests for comment on the criticism of the SEC agenda.

The amendments to the SEC’s whistleblower award program were first proposed in 2018. Changes that the SEC said would help streamline the award claims process received broad support. But whistleblower advocates mounted opposition to several other amendments, including one that would allow the SEC to downsize awards for information that leads to fines of $100 million or more, simply because of their size. Lawyers for tipsters worried that the change could keep highly paid Wall Street insiders from providing information.

Under the whistleblower program, tipsters who provide information that leads to a successful enforcement action against a company are eligible for an award of between 10% and 30% of the overall monetary sanction.

The commission’s rule on extractive industries payments, passed in December, also faced opposition during the rule-making process.

The rule was the SEC’s third attempt to implement a provision of the 2010 Dodd-Frank financial overhaul law aimed at combating corruption by companies in resource extraction industries.

A first version of the rule was vacated by a district court in 2013 after a legal challenge by the American Petroleum Institute, a trade association. A second version was rescinded after Republicans gained control of the U.S. Senate in 2017.

Disagreements over the latest version of the rule focused on the level of detail that public companies would be required to provide when disclosing payments to foreign governments. The rule passed in December allows companies to disclose payments on an aggregated, country-by-country basis, as opposed to a contract-by-contract basis.

Reopening the rule-making process would waste resources on an issue that has already taken up thousands of staff hours, Ms. Peirce and Mr. Roisman said on Monday.

They also criticized the agency and Mr. Gensler for reconsidering rules that increased oversight of proxy voting advisers and made it harder for small shareholders to submit governance and policy proposals at annual corporate meetings.

Their criticism came as the SEC on Monday appointed a new director, Renee Jones, to its division of corporation finance, which drafts rules for companies raising capital and disclosing material news and events to shareholders.

Write to Dylan Tokar at dylan.tokar@wsj.com

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