The article reports
There’s an economic equilibrium that’s been in the marketplace, and government isn’t going to be able to change that by fiat,” said Paul Stevens, chief executive of fund industry trade group the Investment Company Institute, in an interview. “Is government supposed to put price controls on mutual funds?,” asked Barbara Novick, vice chairman of BlackRock Inc. (NYSE:BLK) , the world’s largest asset manager by assets. “I don’t think so; we see a fair number of investors who vote with their feet.”
Stevens also took issue with the timing of the proposals, arguing that the regulatory changes due to new financial legislation, not least the question of whether brokers should be held to a fiduciary standard, should be first addressed.....Ah yes the industry still has a problem with the fiduciary standard which requires that brokers put the clients interests firtst.
The criticisms were focused in particular on the proposed limits to sales charges and plans to let brokers set their own up-front charges. The SEC plan suggests that rather than have funds set sales charges, brokerage firms could compete on price.
BlackRock was one of many industry players to argue that letting brokerages set prices may lead to less competition.
Sorry if I don't follow the logic that letting brokerage firms compete on price is the same as price controls. But then again I often don't understand the arguments presented by the mutual fund industry either on their strategies for new products or their arguments against regulatory reform.
Novick said larger firms would be able to undercut smaller rivals because they can better absorb the administrative costs that come with each account. This, she said, would lead to less choice for investors as the larger firms would dominate the market.