A bill that cleared the House on Wednesday includes an amendment that would upend securities regulators' plans to hold brokers to a new standard when giving advice to retail investors. Added to an appropriations bill that passed 224 to 196, the late addition would prohibit the Securities and Exchange Commission from implementing and enforcing a new regulation that calls for brokers to act in the best interest of their clients when making investment recommendations. The amendment was sponsored by Rep. Maxine Waters (D-Calif.), who chairs the House Financial Services Committee. It was one of dozens of amendments offered, and among those that were approved by the House.

Rep. Maxine Waters, a Democrat from California and chair of the House Financial Services Committee, at a congressional hearing. Andrew Harrer | Bloomberg | Getty Images

The bill will head to the Senate, where the Waters amendment would be less likely to be embraced in the Republican-dominated chamber. Senators could vote on their own version, and then the differences would need to be worked out between the two chambers. The target of Waters' amendment is the SEC's "Regulation Best Interest." Along with other regulatory actions intended to enhance disclosures and clarify some advisors' existing responsibility to put their clients' interests before their own, the new regulation was approved in early June in a 3-1 vote by commissioners. Supporters of the rule — which includes the broker-dealer industry — say it will be an improvement over the current standard for brokers, which only requires them to make sure an investment is "suitable" for a client.