Proposal Rescinded: Wyoming leaders oppose SEC’s proposed rule
Last September, the Securities and Exchange Commission (SEC) announced a proposed rule which would allow buying and selling of undefined rights to certain private and public lands, including to foreign nations.
“The SEC proposal would let investors buy into stock market companies trading on the New York Stock Exchange (NYSE) for the purpose of protecting nature, including public lands and making money,” states U.S. Rep. Harriet Hageman (R-WY) on her website.
On the same day, Hageman and 31 other members of Congress signed a letter demanding answers from the head of the SEC about the newly proposed rule.
According to the SEC website, the proposal would allow the NYSE to list a natural asset company (NAC) and give them the ability to use others’ money, including that obtained via capital markets, to buy the ability to control or manage productive public and private land and other natural resources.
However, on Jan. 17, the NYSE announced it would be withdrawing the proposed rule to the SEC which would have paved the way for NACs to be listed on the NYSE.
Sens. John Barrasso and Cynthia Lummis (both R-WY) released a statement after NYSE withdrew its proposal.
“The NYSE overreaching proposal would have surrendered America’s public lands to the highest bidder,” says Barrasso. “Given the understandable backlash from those who live and work on our public lands, the SEC withdrew this rule before it could take effect. Axing this rule allows for the continuation of responsible land and resource management activities including mining, grazing, energy production and timber logging across Wyoming.”
Lummis adds, “The NYSE’s decision not to list NACs is a huge victory for Wyoming and dismantles the Biden administration’s latest land grab attempt.”
What does this mean?
The proposed rule identifies a NAC as “a corporation whose primary purpose is to actively manage, maintain, restore – as applicable – and grow the value of natural assets and their production of ecosystem services.”
The SEC notes the purpose of a NAC is to protect and grow natural assets under its management, and to qualify as a NAC, a corporation would need to show how it’s improving the lands in its portfolio, which could include “conservation, restoration or sustainable management.”
“Once in control of the land, NACs will be prohibited from engaging in ‘unsustainable activities’ like energy production, logging and grazing. However, farming would still be allowed,” Hageman’s website explains. “The purpose of this rule is to end all economic activity on the lands.”
“This misguided ‘rule’ has the potential to fundamentally change U.S. land access, management, use and ownership as we know it,” Hageman says in a news release published in December.
“As if this weren’t bad enough, the rule places no limits on who can buy these lands. China, Russia, Iran and other bad actors would be free to participate and shut down U.S. energy and mineral production,” she continues.
In a letter dated Jan.10 and sent to the SEC, Wyoming Secretary of State Chuck Gray calls the proposed rule, “Nothing more than a radical environmentalist attempt to cripple Wyoming’s core industries in an effort to further the Biden administration’s radical land grab agenda.”
He adds, “There appears to be no ban on foreign investment NACs, meaning foreign adversaries may be able to own shares in these companies and exert their management authority to prevent Wyoming’s core industries from ever being developed.”
Standing up for Wyoming
Hageman has been at the forefront of this issue, and joining her in the argument is Wyoming Attorney General Bridget Hill, as well as 24 other state attorneys general who sent the SEC a letter earlier this month outlining their opposition to the proposed rule.
In their letters, these entities call the proposed rule illegal and an economic threat, citing there is no legal precedent of any kind where Congress has given the authority to the SEC to set up anything like NACs, and it is misinterpreting the law.
Some of the biggest concerns lawmakers have with the proposal are it could lead to stricter management of public lands and waters, and federal lands, including national parks and forests, would all be fair game to be purchased by a NAC, which could lead to restrictions on mineral development and grazing.
During the Wyoming Freedom Caucus town hall, held on Jan. 10, Hageman proclaimed, “This is just one more step, one more effort in regard for forced or engineered scarcity. It is not natural. I can’t imagine any other country on planet Earth that would do something this radical.”
She further said, “It is possibly the biggest land grab in our country’s history and would be extremely destructive to the West because this is where most of these lands are located.”
Details on the SEC proposal
After the SEC announced the proposed rule, there were only 21 days for public comment, which expired on Oct. 25, 2023. A typical comment period usually runs 60 to 120 days, according to Hageman. However, the comment period was extended to Jan. 18.
“This is one of the most frightening things I’ve seen our government attempt to do,” she says. “They were trying to slip it through.”
Hageman reiterates her office was one of the first in Congress to address the proposed rule, and the more she learned about the issue, the more she has found NACs violating numerous federal laws.
“We have been banging the drum back here, and I think we’ve made some people pretty nervous about the validity of this,” she says. “This is one of the most radical things I’ve seen, and it is so far outside of the authority of the NYSE and the SEC.”
Not only could this impact the U.S.’s ability to generate and access energy, critical minerals, water and food, it could also put those decisions in the hands of institutions, such as foreign governments and their sovereign wealth funds, who could invest in NACs and have actual control over America’s resources.
Melissa Anderson is the editor of the Wyoming Livestock Roundup. Send comments on this article to roundup@wylr.net.
