Regulatory Outlook | 06.14.22
U.S. Financial Firms Push Back on SEC Bid to Rein-In Blank Check Company Deals
U.S. financial industry groups are pushing weaken a draft U.S. Securities and Exchange Commission (SEC) rule aimed at reining-in special purpose acquisition companies (SPACs), arguing it could kill the industry. The proposal would expand liability for financial advisors in a de-SPAC transaction beyond the current rules for underwriters in traditional IPOs, the American Securities Association (ASA) wrote in its comment letter. "This risk would make it untenable for investment banks to continue advising on de-SPAC transactions," said Chris Iacovella, CEO of the ASA. The SEC has been under pressure from some lawmakers to crack down on the SPAC industry. An SEC spokesperson said the agency "benefits from robust engagement from the public and will review all comments submitted during the open comment period."
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