The acting chair of the U.S. Securities and Exchange Commission said on Tuesday the agency was asking a court to pause proceedings in a lawsuit over a climate disclosure rule that was passed by his predecessor and swiftly stayed amid controversy.
“The rule is deeply flawed and could inflict significant harm on the capital markets and our economy,” Acting SEC Chairman Mark Uyeda, a Republican, said in a statement.
Under former SEC chair Gary Gensler, a Democrat whose party held the majority of three out of five commissioner positions, the SEC introduced requirements that companies disclose a variety of climate-related risks to their businesses, arguing the information could be material to investors.
The rule attracted lawsuits, prompting Gensler to suspend its entry into force, pending judicial review.
“The Rule is currently being challenged in litigation consolidated in the Eighth Circuit,” Uyeda said in the statement, referring to a federal appeals court.
Given that the commission is no longer chaired by a Democrat, and that President Donald Trump has ordered a freeze on rule-making, Uyeda said he had asked the court not to take one of the next steps in the process.
“I have directed the Commission staff to notify the Court of the changed circumstances and request that the Court not schedule the case for argument to provide time for the Commission to deliberate and determine the appropriate next steps in these cases,” the statement said. (Reporting by Virginia Furness and Isla Binnie; editing by David Evans)
