Investor Bulletin: Suggestions for How Individual Investors Can Comment on SEC Rulemaking
Dec. 12, 2017
From time to time, the SEC seeks comment from the public on a number of matters, including on the SEC’s rulemakings. The Office of Investor Education and Advocacy is issuing this Investor Bulletin to help explain the rulemaking process and to help promote greater individual investor input in Commission rulemaking proceedings.
What is rulemaking?
Rulemaking is the process that federal agencies use to make rules. Some rulemaking implements laws passed by Congress and signed by the President. Other rulemaking updates rules under existing laws or creates new rules within an agency’s existing authority that the agency believes are needed. The process is designed to give members of the public an opportunity to provide their opinions.
Proposing Release or Rule Proposal. The rulemaking process usually begins with a proposal, which is published for public notice and comment. A proposing release typically contains the text of the proposed new or amended rule along with a discussion of the issue or problem the proposal is designed to address and the associated costs and benefits of the rule. The SEC considers the public’s input on the proposal as it determines its next steps.
Concept Release. Sometimes the SEC seeks public input with a concept release before issuing a proposed rule. A concept release typically outlines the topic of concern, identifies different potential approaches, and raises a series of questions inviting public comment on the matter. The public’s feedback is taken into consideration as the SEC decides which approach, if any, is appropriate.
Adopting Release or Rule Adoption. The adopting release and final rule reflect the SEC’s consideration of the public comments. The new rule or rule amendment becomes part of the official SEC rules.
How do I write my comment?
It is okay to simply state whether you agree or disagree with a concept or a particular rule (or parts of a rule) in your comment letter, but there are some steps you can take to make your letter more helpful to the Commission. Below are some suggestions for you to consider when writing your comment letter:
Understand what you are commenting on. Before you write your comment, consider taking time to read and understand the rulemaking release. Every release includes contact information if you have questions. There are also helpful educational materials on Investor.gov, the SEC’s website for individual investors.
Describe your role and any relevant experience. This could include the fact that you are an individual investor, how many years you have been investing, or any relevant experience you have had as an investor. It is helpful to explain how the rulemaking would affect you, an individual investor.
Identify what you are discussing. Releases are usually divided into sections and include specific requests for comment about the substance of the rulemaking. It is okay to comment on the entire release or only parts of it. Whatever you decide to comment on, it is helpful to identify the section/sub-section/issue you are discussing or the questions you are answering.
State your opinion of the rule and explain why. Indicate if you are for or against the rulemaking and explain why. It is okay to support parts of the rulemaking and oppose others. Consider discussing both what you oppose and support in the rulemaking because the agency could also modify the parts you like.
Use examples. Think about using specific examples to illustrate your concerns with, or support of, the rulemaking. Let the Commission know about your experiences with SEC rules or how new rules or changes to existing rules would affect you.
Suggest solutions or alternatives. Consider suggesting solutions or alternatives to the parts of the rulemaking that you oppose, think should be changed, or could be improved. It is helpful if you include specifics of the alternative. In addition, you could explain how the alternative would achieve the goals of the rulemaking and why you believe your alternative is better, less costly, or more effective.
Provide data. If you have data that supports or contradicts the rulemaking, please include it in your comment letter. Also, if you have data that supports your suggested solution or alternative please provide it so it can be considered in the SEC’s decision about the rulemaking.
How do I submit my comments?
Rulemaking releases issued by the SEC are published in the Federal Register and on the SEC’s website, SEC.gov, and can be located through the Regulatory Actions page. The online form to submit comments is accessed by the “submit comments” link for each listed rulemaking. For detailed instructions how to submit comments through SEC.gov or regulations.gov, please read How to Submit Comments to the SEC.
Please remember that the SEC does not edit personal identifying information from a submission, so submit only information that you wish to make available publicly.
What happens after I submit a comment?
After you submit a comment, it will be posted at the “Comments received are available for this proposal” link for the rulemaking on the SEC’s website. The SEC considers comments received in connection with its next steps.
The Office of Investor Education and Advocacy has provided this information as a service to investors. It is neither a legal interpretation nor a statement of SEC policy. If you have questions concerning the meaning or application of a particular law or rule, please consult with an attorney who specializes in securities law.
The Office of Investor Education and Advocacy does not intend for the information in this Investor Bulletin to alter the comment process under the Administrative Procedure Act for any rulemaking. For example, the Investor Bulletin does not change the deadline for comments on any particular rulemaking. It is designed to help promote greater individual investor input in Commission rulemaking proceedings. If you have any questions about a rulemaking, please contact the SEC staff listed in the rulemaking release.