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Feel free to use pelham bits, eggbutts, loose rings, and full-cheek snaffles but gags (except hunter gags), hackamores, three-ring bits, et cetera are illegal. Note that the use of the phrase et cetera is actually in the rulebook, so it's best to steer clear of most leverage bits besides pelhams.
Currently bitless bridles are not allowed in dressage competitions and are considered unconventional tack for hunters. You do see them in eventing (for the show jumping and cross country phases), in jumpers and in endurance competitions.
But they must be used by an experienced equestrian. Some modern styled hackamores are scientifically developed and designed to operate with less pressure, plus hackamores don't hurt a horse's sensitive mouth.
The hackamore allows you to use direct-rein cues, just like a snaffle, but begins to introduce the concept of neck reining. That concept is further honed with the two-rein setup and then eventually the bridle. But the hackamore isn't exclusive to reined cow horses.
I prefer to start a horse in the hackamore, rather than a sna ffle bit, because it protects the horse's mouth as its teeth are changing, and the horse is learning to accept a rider and move its feet, Sandifer says.