17 Dec Spending Bill Bans Public Company Disclosure of Political Contributions

A new omnibus spending bill announced by US lawmakers contains an interesting provision: “None of the funds made available by any division of this act shall be used by the Securities and Exchange Commission to finalize, issue or implement any rule, regulation or order regarding the disclosure of political contributions, contributions to tax exempt organizations or dues paid to trade associations,” a rider to the bill says. Congress is expected to vote on the bill and rider tomorrow, and must vote no later than December 22.

After the Citizens United case, which removed many limits on campaign contributions, various petitions have been delivered to the SEC imploring them to implement a rule requiring public companies to disclose what political contributions they are making. There’s a lawsuit pending as well on the subject. This new rider is clearly meant for the Republican-controlled Congress to push back on that.

As my faithful blogees know, I believe it is better when the SEC stays out of choosing either political or social issues to drive disclosure requirements of public companies, whether due to Apartheid, conflict minerals or political contributions. These may be important issues, but there are unintended consequences of requiring these disclosures, not to mention the seemingly random nature of the issues chosen.