May 10, 2024. The Federal Register serves as a vital source of information on federal government activities, including presidential documents, proposed and final rules, and regulations. Recently, there has been a significant development in the realm of real estate investment trusts (REITs) regulation, with the issuance of final Treasury regulations that directly impact the industry. FTI Consulting's Scott Drago and Stephen Bertonaschi have been closely monitoring these updates and shedding light on their implications.
These newly issued final Treasury regulations on REITs bring about crucial changes in how these entities are governed and operate. With the goal of ensuring transparency and compliance within the industry, these regulations aim to address potential loopholes and strengthen oversight mechanisms. Scott Drago and Stephen Bertonaschi have been actively engaged in analyzing the intricacies of these regulations and guiding clients on navigating the evolving landscape of REITs regulation.
One of the key aspects addressed in the final Treasury regulations is the classification of marijuana and its implications for REITs. A proposed rule sent to the federal register recognizes the medical uses of cannabis and acknowledges it has less potential for abuse than other substances. If approved, the new classification would put marijuana in the same category as ketamine and some steroids, opening up new avenues for investment and growth in the industry.
In addition to the changes in marijuana classification, the final Noncompete Rule has been a focal point for industry stakeholders. Under this rule, the Federal Trade Commission (FTC) has adopted a comprehensive ban on new noncompetes with all workers, including senior executives. This move is aimed at promoting fair competition and protecting workers' rights in the increasingly competitive landscape of REITs.
Environmental considerations have also been at the forefront of recent updates in the Federal Register. Environmental law updates for May 2024 from agencies such as the Environmental Protection Agency (EPA) and the Food and Drug Administration (FDA) have highlighted the importance of sustainable practices in REITs operations. With a focus on nanotechnology and emerging technologies, these updates underscore the need for responsible stewardship of resources and compliance with environmental regulations.
The U.S. Census Bureau's call for public comment on a proposed test of sexual orientation and gender identity (SOGI) questions on the American Community Survey (ACS) further emphasizes the evolving regulatory landscape for REITs. This initiative aims to gather data on LGBTQ individuals and their housing needs, signaling a more inclusive approach to housing policy and regulation.
As of Monday, May 13, there have been 1,148 rules and regulations finalized among the 41,830 pages published to the Federal Register. This extensive volume of updates reflects the dynamic nature of regulatory frameworks governing REITs and underscores the importance of staying informed and proactive in compliance efforts.
Overall, the recent developments in the Federal Register have significant implications for the REITs industry. From changes in marijuana classification to noncompete rules and environmental considerations, stakeholders must stay abreast of these updates to navigate the evolving regulatory landscape effectively. FTI Consulting's Scott Drago and Stephen Bertonaschi provide valuable insights and guidance to clients seeking to adapt to these regulatory changes and thrive in the competitive REITs market.
