Rep. Austin Scott, Chairman of the House Agriculture Committee's Subcommittee on Horticulture, Research, Biotechnology and Foreign Agriculture, held a public hearing to review the impact of enforcement activities by the U.S. Department of Labor (DOL) on specialty crop growers. Specifically, Subcommittee Members addressed growing concerns that DOL is using the "Hot Goods" provision under the Fair Labor Standards Act of 1938 (FLSA) in an arbitrary manner against producers of perishable agricultural commodities without regard for the inevitable destruction of the product and significant economic hardship inflicted on farmers and their employees.
Subcommittee Further Explores Impact of CFTC's Rulemaking Approach for Dodd-Frank on End Users & Economy
Tamara Hinton, 202.225.0184
WASHINGTON – Today, Rep. K. Michael Conaway (R-TX), Chairman of the House Agriculture Committee's Subcommittee on General Farm Commodities and Risk Management held a public hearing to further review the Commodity Futures Trading Commission's (CFTC) efforts to write rules that will implement a new regulatory regime on the derivatives market under title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
This hearing was a continuation from last week's discussion when the full committee received testimony from Chairman Gary Gensler of the Commodity Futures Trading Commission, as well as five other witnesses, including buyers and sellers of derivatives, and providers of clearing and execution platforms. Today's panel included additional market perspectives on the potential impact of the more than 30 new regulatory proposals the CFTC has issued since September.
"Last week, we focused on the process that Commissioners undertook and what data they utilized in drafting their proposals. Our work today, while similar, was focused on what these new rules mean to market participants. Today we were able to ask the tough questions of how much compliance will cost, what business practices will be altered, and how much the new regulatory burdens will impact economic growth. It was good to hear from a broad spectrum of market participants to share with us how they view the pending regulations and what their suggestions are for improving the process and the output of CFTC rulemaking," said Chairman K. Michael Conaway.
"In regulating over-the-counter derivatives, Congress has made certain exceptions for end-users who utilize swaps to hedge risk and keep their businesses stable, and I believe it is imperative that the regulations implemented reflect the true intent of Congress,” said Ranking Member Leonard L. Boswell. “I hope today’s hearing underscores the need to not punish these end-users who, like consumers, were victims in the financial crisis, and instead focuses on implementing regulations that prevent a few players from manipulating the market and make sure that never again are American taxpayers left with the bill."
Written testimony provided by the witnesses is available below and can be found on the Committee's website by clicking here.
Mr. Shawn Bernardo, Managing Director, Americas Head of Electronic Broking, Tullet Prebon, and Vice Chairman, Wholesale Markets’ Brokers Association, Americas (WMBAA), Jersey City, New Jersey
Mr. Bill Bullard, Chief Executive Officer, R-CALF USA, Billings, Montana
Mr. Stuart Kaswell, General Counsel, Managed Funds Association, Washington, D.C.
Mr. John M. Damgard, President, Futures Industry Association, Washington, D.C.
Mr. Richard F. McMahon, Jr., Vice President, Energy Supply and Finance, Edison Electric Institute (EEI), on behalf of Edison Electric Institute, American Public Power Association, Electric Power Supply Association, Washington, D.C.
Ms. Bella Sanevich, General Counsel, NISA Investment Advisors, L.L.C., on behalf of the American Benefits Council and the Committee on Investment of Employee Benefit Assets, St. Louis, Missouri