The U.S. Chamber of Commerce’s (“Chamber”) Center for Capital Markets Competitiveness (“CCMC”) submits our views in response to the recent order issued by the Securities and Exchange Commission (“SEC” or “Commission”) relating to the Financial Industry Regulatory Authority’s (“FINRA”) proposal to establish a corporate bond new issue reference data service (“Data Service”). Consistent with previous comments the CCMC has submitted to the SEC, we continue to be concerned that FINRA has failed to accurately estimate the costs and justify the need to create a centralized new issue corporate bond database operated by FINRA.
In January 2021, the SEC approved FINRA’s plan – first proposed in 2019 – to establish the Data Service. Under the plan, FINRA members would be mandated to cover the costs for setting up the Data Service, including providing 32 new fields of data to FINRA and supporting the infrastructure required for FINRA to manage the information that would be collected. The three comment letters CCMC submitted in 2019 outlined several flaws with FINRA’s proposal and questioned whether the urge to consolidate data for new issue corporate bonds into a quasi-governmental database was necessary and in the best interest of investors. To summarize, CCMC expressed concern that the proposal: