WASHINGTON — Federal officials say they are preparing to propose a series of regulatory changes to enhance American competitiveness overseas, attract foreign investment and give American investors a broader selection of foreign stocks.

But critics say the changes appear to be a last-ditch push by appointees of President Bush to dilute securities rules passed after the collapse of Enron and other large companies — measures that were meant to forestall accounting gimmicks and corrupt practices that led to those corporate failures.

Legal experts, some regulators and Democratic lawmakers are concerned that the changes would put American investors at the mercy of overseas regulators who enforce weaker rules and may treat investment losses as a low priority.

Foreign regulators are beyond the reach of Congress, which oversees American securities regulation through confirmation proceedings, enforcement hearings and approval of the Securities and Exchange Commission’s budget.

The commission is preparing a timetable that will permit American companies to shift to the international rules, which are set by a foreign organization and give companies greater latitude in reporting earnings. Companies that have used both domestic and overseas rules have, on average, been able to report revenues and earnings that were 6 percent to 8 percent higher under the international standards, according to accounting experts.

Though foreign accounting standards are stronger in some ways than American accounting principles, they are weaker in some important areas. They enable companies, for example, to provide fewer details about mortgage-backed securities, derivatives and other financial instruments at the center of today’s housing crisis and that have troubled many Wall Street firms, includingBear Stearns.

The shift to international standards could also wind up eliminating the conflict-of-interest rules, adopted after the collapse of Arthur Andersen and Enron, that have limited auditors from performing both accounting work and consulting for the same client.

James D. Cox, a securities law expert at Duke Law School who returned this week from teaching corporate law in Europe, said the shift to international rules amounted to “outsourcing safety standards.”

“We would not for a moment tolerate having American auto safety standards set by China or India,” he said. “Why should we do it for financial safety standards? There has to be some accountability.”

The S.E.C. also plans to announce details of a pilot program that would enable foreign brokers to deal directly with American investors, while continuing to be largely regulated by the foreign country. The first country in the program will be Australia, although officials hope to eventually include other countries. In a third move, the Public Company Accounting Oversight Board, which works under the supervision of the S.E.C., is preparing a rule that would allow it to defer to foreign regulators for inspections of some of the 800 foreign auditors of overseas companies that sell stock in the United States.

The oversight board was created by the Sarbanes-Oxley law of 2002 in response to the accounting scandals at Enron and other large companies. The law requires the board to inspect regularly all accounting firms that certify the financial results of companies whose shares are sold in the United States.

Officials say the proposed changes reflect the decades-long push toward global markets. They say the changes are necessary to attract capital from abroad and will protect Americans as they increasingly look to invest overseas. In the decade ending last November, American holdings of foreign stock increased to $4.3 trillion from $1.2 trillion.

“You are seeing a world now where everything is mobile,” Ethiopis Tafara, director of international affairs at the S.E.C., said in an interview. “You have securities issuers that are mobile. Broker dealers can provide services from anywhere. Exchanges are mobile, and electronic trading platforms don’t need a physical location. You have capital that is mobile, it travels almost anywhere around the world.”

“When you have everything that is mobile, the way we think about our mandate — investor protection and enforcement — has to take this into account,” Mr. Tafara said.

Mr. Tafara said that the mutual recognition agreement with Australia would continue to protect American investors because the S.E.C. would continue to have the authority to prosecute foreign companies under antifraud provisions of the law for what he called “lying, stealing and cheating.” The S.E.C. would continue to investigate accusations of illegal insider trading, for example, an area where the commission has been more vigorous than many foreign jurisdictions.

But the S.E.C. would not enforce many investor-protection laws involving issues ranging from the quiet period before a stock offering to market manipulation, financial disclosures and abusive trading tactics. Nor would foreign officials apply a panoply of American securities rules that are unique in that they are intended to protect minority shareholders. Instead, the commission would rely on its Australian counterpart to enforce its securities regulations, which often involve different standards.

In a speech earlier this year, Christopher Cox, the agency’s chairman, said that working on the transition to international accounting standards and reaching enforcement agreements with foreign countries like the Australians were two of the most important items on his agenda as his term comes to a close.

“It is no longer possible for the S.E.C. to do its work in the United States without a truly global strategy — because, in large measure due to today’s instant communications and technology, what goes on in other markets and jurisdictions is now intimately bound up with what happens here,” he said.

But critics say that the move toward harmonizing rules and enforcement practices is fraught with problems and would dilute American securities laws, generally considered to be the most protective of investors in the world.

“The impetus for these changes has been a generalized concern about competitiveness but the results could very well be a weakening of rules,” said Senator Jack Reed, the Rhode Island Democrat who heads the Senate banking subcommittee on securities and investment, which has jurisdiction over the S.E.C. “The notion that we’re becoming rapidly globalized is clear. There is a need for harmonized rules. But the real question is, are the foreign rules any good?”

“We’ve heard this argument about competitiveness for the last two years,” Mr. Reed added. “But guess what? There are a lot of lost jobs on Wall Street not because of competitiveness issues but because our regulators have actually not been up to the task.”

Senator Carl Levin, Democrat of Michigan, said the proposals would “weaken the pressure for credible oversight” of the markets and their regulators.

“This is a very, very serious problem,” Mr. Levin said. “We’ve had so many losses to investors based on inadequate oversight. We can’t proceed to give control of regulation — to delegate or cede control — to bodies that are not accountable. If this is delegated to regulators overseas, it weakens our ability to put pressure on the regulators to do what the law requires them to do.”

Although the staff of the S.E.C. has been working on the changes for many months, the agency has been hampered by vacancies at the top. Those vacancies were filled last week, when the Senate confirmed three new commissioners, including two Democrats, to the five-member commission. To adopt the changes, Christopher Cox, the agency’s chairman, will need to get the support of at least two commissioners.

Industry groups have pushed for many of the changes. Large international accounting firms, for example, have complained that the emergence of a new generation of American and foreign regulators inspecting them has led to onerous duplication.

Jeff Willemain, global managing partner for regulatory and risk at Deloitte, said at a roundtable discussion in Washington last week that the emerging system of “multiple and duplicative” inspections of audit firms by different countries has created “inefficiencies” that do not result in greater investor protection.

But the track record of foreign enforcement authorities indicates that they are generally less aggressive than their counterparts in the United States, and that even the most vigorous ones bring fewer cases and impose significantly lower penalties.

“Few if any countries spend as much on — or devote as much intensity of effort to — enforcement of financial reporting and auditing as the U.S. does,” said Charles D. Niemeier, a member of the Public Company Accounting Oversight Board, who has dissented from its proposal to let foreign authorities inspect auditors. Referring to the fact that foreign investigations are often not wide-ranging, he added, “Even the most robust of those other regulators have faced scope limitations and other challenges that we would not countenance.”

But foreign regulators say it is absurd to think that the United States has the ability to police markets alone.

“Let’s be clear — no single jurisdiction can resolve all the problems of globalization,” said Pierre Delsaux, a senior markets regulator at the European Commission. “We are all doing the same thing. No country has a monopoly on protecting investors.”

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Times Topics: U.S. Securities and Exchange Commission