Defining Dealer Act

New dealer rule and order vacatur

If enacted, the bill would change who counts as a "dealer" under the Securities Exchange Act. The bill would make a person a dealer only if they both (1) buy securities from customers for their own account with a view to reselling them, and (2) sell to customers securities they previously bought for their own account. Most security-based swaps would be excluded, except swaps with or for people who are not eligible contract participants. The dealer rule would take effect 30 days after enactment and could mean fewer firms must register as dealers. The bill would also require courts and the SEC to vacate certain orders or judgments that would not have been entered under the new rule. Orders entered between enactment and the rule's effective date must be vacated no later than five years after enactment, and orders entered before enactment must be vacated as soon as practicable.