Anirban Sen and Chris Prentice
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By Anirban Sen and Chris Prentice
NEW YORK (Reuters) -U.S. exchange operators are in talks with the Securities and Exchanges Commission on easing regulatory burdens for public companies, as they seek to encourage more richly valued startups to list, according to four people familiar with the matter.
These deliberations, the details of which are reported here for the first time, involve the SEC, Nasdaq and the New York Stock Exchange. The reforms under discussion range from reducing the quantum of disclosures and the costs of going public to making it harder for minority investors to agitate, the sources said, requesting anonymity as they were not authorized to speak publicly.
The talks, which the sources said have been ongoing for several months, come amid a renewed push to ease regulations under President Donald Trump, whose administration has said it wants to do so to spur economic growth.
Taken together, some market experts said these discussions could mark the most significant push to introduce regulatory reform for companies since the Jumpstart Our Business Startups Act was signed into law by former President Barack Obama in 2012, and build on efforts seen during Trump's first term.
"The numbers are very clear that companies are staying private longer," Nasdaq President Nelson Griggs told Reuters. Griggs said the exchange operator has discussed making public markets more attractive with regulators in Washington but did not specify which agencies.
"We need to make the public markets attractive because that is really how you democratize access to these companies. So it's a big focus of ours," Griggs said. Nasdaq has publicly made the case for easing burdens by using remedies such as the modernization of the process for proxy filings.
In a statement to Reuters, Jaime Klima, general counsel of NYSE Group, said the exchange will "continue to advocate for our listed companies with regulators and policymakers.”
"We strongly believe that effective and efficient regulation is key to maintaining the attractiveness of our markets," Klima said, without specifying any specific discussions ongoing.
The SEC, led by new chairman Paul Atkins, said it is looking to ease rules that can impede capital formation.
"The SEC is considering addressing regulatory burdens that undermine capital formation, including (ensuring) that initial public offerings are again something companies are eager to do," a spokesperson for the agency said.
The SEC did not comment on specific discussions it has held with exchanges and other stakeholders.
