The bill repeals the provision and clarifies that the existing FOIA provision will protect against the release of confidential information contained in the records of any entity that falls under the SEC’s regulatory authority.
The House is expected to act soon on the legislation.
The SEC has argued that it needs the broader Freedom of Information Act exemptions to ensure financial firms that vital company information is protected and isn't released to the public.
Four senators cosponsored the legislation -- Patrick Leahy (D-Vt.), Ted Kaufman (D-Del.), John Cornyn (R-Texas) and Chuck Grassley (R-Iowa).
Leahy said FOIA "has long recognized the need to balance the Government’s legitimate interest in protecting confidential business records, trade secrets and other sensitive information from public disclosure, and preserving the public’s right to know."
When the FOIA provision was added for the SEC "we sought to ensure that the SEC had access to the information that the Commission needed to protect American investors – not to shield information from the public," Leahy said.