Rep. Hill looks to encourage broker-dealers to publish research on exchange traded funds

U.S. Rep. French Hill (R-Little Rock), a long-time banker and investment manager, wants to remove “anomalies” in the law that prevent broker-dealers from offering research on exchange traded funds. Hill and U.S. Rep. Bill Foster (D-Illinois) have introduced H.R. 910, the Fair Access to Investment Research Act, to address the “anomalies in securities laws and regulations” that have discouraged “broker-dealers from publishing research on exchange traded funds by directing the Securities and Exchange Commission to provide a safe harbor for research reports that cover ETFs,” according to a news release.

Over the past 30 years, exchange traded funds have increased to more than 1,500 funds with $2.1 trillion in assets, up from 100 funds with $100 billion in assets. But as the popularity of ETFs has risen, anomalies in securities laws have discouraged broker-dealers from publishing research on ETFs.

“This complex market lacks research and information that could greatly benefit consumers,” Hill said. “I always advocate for commonsense legislation that promotes capital formation, removes unnecessary burdens and improves investor access to information.” Hill previously introduced a similar bill that passed in the House in June 2016 by a vote of 411-6. Before he started his first congressional term Jan. 3, 2015, Hill worked for 20 years as a commercial banker and investment manager. He was founder, chairman and chief executive officer of Little Rock-based Delta Trust & Banking Corp., which recently merged with Simmons First National Corp.

“I am proud to introduce legislation that will strengthen our financial system with Congressman Hill,” Foster said. “This legislation would create transparency in financial markets that will ultimately benefit consumers.”

U.S. Sen. Dean Heller (R-Nevada) and U.S. Sen. Gary Peters (D-Michigan) have introduced a companion bill in the Senate.