H.R. 7127: Restoring the Secondary Trading Market Act
Sponsor
Daniel Meuser
Republican · PA-9
Bill Progress
Latest Action · Mar 4, 2026
Committee approved bill for floor consideration by the Yeas and Nays: 26 - 17.
Why it matters
Introduced on January 16, 2026, H.R. 7127 would immediately shift power from states to the Securities and Exchange Commission by blocking state limits on certain off-exchange stock trades if issuers keep specific public information current.
The policy fight here is about who sets the rules for secondary trading in less traditional markets: states or Washington. Supporters will likely argue that a patchwork of state rules can choke off liquidity and make it harder for investors to buy and sell securities in private or over-the-counter settings. Critics are likely to argue that states would lose an investor-protection tool, because the bill expressly bars them from directly or indirectly imposing conditions once the issuer satisfies the public-information standards in 17 CFR 230.257(b) or 17 CFR 15c2-11(b).
What does H.R. 7127 do?
Amends Securities Act section 18(a)
H.R. 7127 amends Section 18(a) of the Securities Act of 1933, specifically 15 U.S.C. 77r(b)(4), to restrict state regulation of certain secondary-market trades.
States barred from blocking covered trades
The bill says states may not directly or indirectly prohibit, limit, or impose conditions on "off-exchange secondary trading" for issuers that meet the bill's disclosure standard.
Two disclosure paths to qualify
An issuer gets the exemption only if it makes current information publicly available using one of two routes: the periodic and current reports described in 17 CFR 230.257(b), or the documents and information specified in 17 CFR 15c2-11(b).
SEC defines the key trading term
Rather than writing its own definition, the bill gives the Securities and Exchange Commission authority to define "off-exchange secondary trading," which will determine how much activity falls under the state-law exemption.
Introduced January 16, 2026
The measure was introduced on January 16, 2026, in the 119th Congress, 2d Session, by Mr. Meuser and sent to the House Committee on Financial Services.
Who benefits from H.R. 7127?
Issuers that keep current information public
Companies that publicly provide the information required by 17 CFR 230.257(b) or 17 CFR 15c2-11(b) would gain protection from state rules that otherwise could prohibit, limit, or condition off-exchange secondary trading in their securities.
Investors trading in secondary markets
Investors seeking to resell or buy eligible securities outside national exchanges could face fewer state-by-state barriers if the issuer satisfies the bill's public-information requirement.
Broker-dealers and market intermediaries
Firms involved in handling off-exchange secondary trading could benefit from a more uniform framework because H.R. 7127 would override conflicting state conditions for covered securities.
The Securities and Exchange Commission
The SEC gains meaningful authority because the bill explicitly lets the agency define "off-exchange secondary trading," giving it control over the scope of the new preemption.
Who is affected by H.R. 7127?
State securities regulators
State regulatory bodies would lose the ability to directly or indirectly prohibit, limit, or impose conditions on covered off-exchange secondary trading once an issuer meets the disclosure standard in 17 CFR 230.257(b) or 17 CFR 15c2-11(b).
Issuers that do not provide current information
Companies that do not make current information publicly available under either 17 CFR 230.257(b) or 17 CFR 15c2-11(b) would not qualify for the bill's protection from state regulation.
Investors relying on state-level protections
Investors in these markets could see fewer state-imposed safeguards because H.R. 7127 blocks states from attaching conditions to covered trades, shifting more weight to federal disclosure rules and the SEC's definition.
Private and over-the-counter trading venues
Platforms and venues involved in off-exchange activity could see broader participation if trades fall within the SEC's eventual definition of "off-exchange secondary trading" and involve issuers meeting the bill's disclosure rules.
HR7127 Legislative Journey
House: Vote: 26-17
Mar 4, 2026
Ordered to be Reported by the Yeas and Nays: 26 - 17.
House: Committee Action
Jan 16, 2026
Referred to the House Committee on Financial Services.
About the Sponsor
Daniel Meuser
Republican, Pennsylvania's 9th congressional district · 7 years in Congress
Committees: Small Business, Financial Services
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Committee Sponsors
Financial Services Committee
0 of 54 committee members cosponsored
No committee members have cosponsored this bill
30 Republicans across this committee haven't cosponsored yet. Mobilize their constituents
H.R. 7127 Quick Facts
- Committee
- Financial Services
- Chamber
- House
- Policy
- Finance and Financial Sector
- Introduced
- Jan 16, 2026
Committee approved bill for floor consideration by the Yeas and Nays: 26 - 17.
Mar 4, 2026
Full Bill Text
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