This resolution would overturn the Consumer Financial Protection Bureau’s arbitration agreements rule that was finalized on July 19, 2017. The rule was initially proposed during the Obama administration, and prohibits financial firms from requiring users of credit services to sign mandatory arbitration agreements that preclude them from filing class action lawsuits, and is set to take effect 60 days after being finalized. Mandatory arbitration agreements require consumers to handle disputes through private arbitration rather than through the court system.
Under the Congressional Review Act, Congress is able to overturn regulations finalized within the last 60 legislative days with simple majority votes on a joint resolution of disapproval in both chambers and the president’s signature. CRA resolutions also prevent the federal agency that created the regulation from issuing a similar rule without being directed to do so by Congress.