ICR D.C. Insider: March 2023


In the March 2023 edition of The ICR D.C. Insider, we share our insights and analysis about developments in Washington that could have an immediate and long-term impact on your business.

What’s Coming Next In Washington

The first month of 2023 has already produced a number of important issues and policy developments, many of which will dominate the agenda in the coming year, including:

  • The Debt Ceiling – The Congressional Budget Office (CBO) has predicted that the so-called “X Date” – the date on which the debt ceiling will be reached – will fall between July and September, further afield than the Treasury Department’s previous forecast of June. Similarly, the Bipartisan Policy Center (BPC) theorizes that the X Date could hit between summer and fall depending on tax receipts. The extended timeline has slowed the pace of negotiations between the White House and the Republican-led House of Representatives  and will likely lead to increased market volatility.
  • Crypto – Even as the SEC continues to ramp-up the announcement of enforcement actions in the crypto space, it is now clear that crypto isn’t going to get special treatment from Congress any time soon. A joint crypto policy statementfrom the Federal Reserve, the FDIC, and the Office of the Comptroller of the Currency underscores that regulators are now making it known that they believe the old-school rules of finance work just fine. The SEC also proposed a rule that could make it more difficult for many asset managers to invest customers’ money in cryptocurrencies, as policy makers push to rein in the sector following trading platform FTX’s collapse. Members of Congress also continue to position themselves on crypto-related matters, with Elizabeth Warren (D-Mass.) along with several Republicans taking a leadership role.


  • Climate Change Disclosure Rule – News and controversy continue to build around this proposed rule:
    • Top Senate and House Republicans are demanding that SEC Chair Gary Gensler turn over reams of internal deliberations to justify the agency’s proposed climate disclosure rule. The strident letter emphasizes that the Commission’s proposal “exceeds the SEC’s mission, expertise and authority and, if finalized in any form, will unnecessarily harm consumers, workers and the U.S. economy.”
    • Acknowledging the more than 15,000 comments the SEC received on this proposed rule, Chair Gary Gensler said that the Commission would likely make adjustments to it.
    • The Wall Street Journal reports that the SEC is weighing whether to make the climate disclosures in financial statements less onerous than originally proposed, including raising the threshold at which companies must report climate costs.
    • At the same time, sources at the Commission signaled that a primary concern is the wave of lawsuits that are expected to challenge the rule once it’s finalized. The SEC is weighing what to do with one of the most contentious pieces of the plan: A mandate that certain large public companies report data about carbon emissions from their extensive supply chain networks and customers, known as Scope 3.
  • New Rules To Go Into Effect For Corporate Insiders Who Sell Company Stock – Effective April 1st, most U.S.-listed companies will be subject to new disclosure requirements for officers and directors. Among the highlights: Officers and directors will have to wait at least 90 days after starting or modifying a 10b5-1 plan before they can trade under the arrangement. The forms used to report their trades will include mandatory checkbox disclosures showing whether they were using such a plan, as well as the plan’s adoption date. The companies will also have to disclose the substance of 10b5-1 plans in their quarterly and annual reports.
  • Progressives Disappointed Gensler Not Going Further – Progressive allies along with SEC Commissioner Caroline Crenshaw are criticizing Gensler about what they see as his failure to take on one of their top priorities: setting stricter rules for the private markets and reining in private equity. In a high-profile speech, Commissioner Crenshaw pointedly raised the specter of failed “unicorns” such as FTX and Theranos, noting they were able to raise huge amounts of money while making extremely limited disclosures to investors. Among those allied with Crenshaw are labor unions who want to diminish the clout of private equity firms, hedge funds and other big investors as well as congressional Democrats, including Sen. Elizabeth Warren (D-Mass.).
  • Division of Examinations Announces 2023 Priorities – The 2023 priorities include compliance with new SEC rules applicable to investment advisers and investment companies, as well as continuing the Commission’s focus on emerging issues and rules aimed at protecting retail investors.
  • Accredited Investor Definition Up For Debate – The House Financial Services Committee Subcommittee on Capital Markets held a hearing, “Sophistication or Discrimination? How the Accredited Investor Definition Unfairly Limits Investment Access for the Non-wealthy and the Need for Reform” to examine changes in the accredited investor definition. Republicans advocated lowering the threshold.
  • Crowdfunding Rules Could Be Relaxed – The House Financial Services Committee Subcommittee on Capital Markets held a hearing entitled “Empowering Entrepreneurs: Removing Barriers to Capital Access for Small Businesses.” Full Committee Chair Patrick McHenry (R-N.C.) said last year that overhauling capital formation rules would be a top priority for his committee.


  • Product Review “Hijacking” Sanctioned – A case the FTC settled marks its first enforcement action against a practice called “review hijacking,” in which a marketer makes reviews for one product appear to apply to another. Review hijacking is one of the clearly deceptive or unfair practices involving reviews on which the Commission sought comment in October 2022 when it announced an advance notice of proposed rulemaking.
  • Republican Commission Resigns…Loudly – In a stinging op-ed in The Wall Street Journal, Republican FTC Commissioner Christine Wilson announced her resignation, pointing to FTC Chair Lena Khan’s “disregard for the rule of law and due process and the way senior FTC officials enable her.” Wilson is the only Republican on the FTC, and said she will depart “soon” but gave no specific date. Without Wilson, the FTC will have three remaining members (all Democrats) of what is usually a five-member commission., President Biden now has the opportunity to nominate two commissioners, though neither can be Democrats.

Additional Key Developments

  • House, Senate Block Labor Department’s ESG rule – Both chambers passed legislation that would nullify the Department of Labor’s recent rule allowing fiduciary retirement fund managers to weigh environmental, social, and governance (ESG) factors into their investment decisions. Democratic Senators Joe Manchin (W.Va) and Jon Tester (Mont.) joined Republicans in the vote. The bill now goes to President Biden who is expected to veto it.
  • NLRB Curtails Conditions For Severance Payments – The National Labor Relations Board (NLRB) ruled that it’s generally illegal for companies to offer severance agreements that prohibit workers from making potentially disparaging statements about the employer or from disclosing details of an agreement.
  • Republicans Defend Small Businesses – House Small Business Republicans, led by Chair Roger Williams (Tex.), Blaine Luetkemeyer (Mo.), and Beth Van Duyne (Tex.) sent letters to 25 agencies, including the EPA, DOL, IRS, and CFPB. The letters addressed the agencies’ compliance with laws that require them to analyze the effects of new rules on small employers and to produce compliance guides for those firms.
  • China
    • The new House Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party, led by Rep. Mike Gallagher (R-Wisc.) was authorized by widespread bipartisan support (365–65). The Select Committee (13 Republicans and 11 Democrats) is expected to take an active role across a range of issues, including voicing its views about an outbound investment monitoring vehicle (in the model of CFIUS – the Committee on Foreign Investment in the United States); support for Taiwan; U.S. dependence on China for critical supply chains, particularly with respect to information technology or to pursue climate change goals; U.S. foreign investment or private sector technology partnerships in China that could have adverse national security or human rights consequences; and China’s foreign interference and influence campaigns, including via U.S. academic institutions.
    • As of February 13th, more than 30 new pieces of legislation targeting China had been released, demonstrating that anti-China sentiment across Washington is only increasing. Among the new pieces of legislation introduced were The Countering Economic Coercion Act, and The Foreign Adversary Communications Transparency (FACT) Act.
    • The Department of Justice and the Department of Commerce launched the Disruptive Technology Strike Force. Under the leadership of the Justice Department’s National Security Division and the Commerce Department’s Bureau of Industry and Security (BIS), the strike force will bring together experts throughout government, including the FBI, Homeland Security Investigations (HSI), and 14 U.S. Attorneys’ Offices in 12 metropolitan regions across the country. The strike force will target illicit actors, strengthen supply chains, and protect critical technological assets from being acquired or used by nation-state adversaries. Deputy Attorney General Lisa Monaco also said the Biden Administration is also exploring how to monitor the flow of private capital in critical sectors and ensure that our own “outbound investment” (an outbound version of CFIUS) in dual-use technology doesn’t provide our adversaries with a national security advantage.
    • Mitt Romney (R-Utah), and Chris Van Hollen (D-Md.) introduced a bill that would end the practice of treating China as a “developing nation” in treaties and international organizations.
    • Senate Intelligence Committee Chair Mark Warner (D-Va.) and Ranking Member Marco Rubio (R-Fla.) sent a letter to Commerce Secretary Gina Raimondo requesting a list of the top 5 most critical high-technology sectors in the U.S. and a license review to understand how many license requests were approved for Chinese companies on the Entity List, among other items.
    • The Countering Economic Coercion Act, originally filed by key Biden ally Sen. Chris Coons (D-Del.) and Sen. Todd Young (R-Ind.), now has a House companion filed by House Foreign Affairs Committee Ranking Member Gregory Meeks (D-N.Y.), House Rules Committee Chairman Tom Cole (R-Okl.) and House Foreign Affairs Indo-Pacific Subcommittee Ranking Member Ami Bera (D-Calif.). Both Coons and Young serve on the Senate Foreign Relations Committee where Young is Ranking Member of the Subcommittee, which focuses on foreign policy regarding Asia.