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On February 19, 2025, President Donald Trump signed an executive order (the "Order") mandating that independent agencies, including the SEC, the FCC, and the FTC, submit proposed regulations for presidential review before finalization. The order marks a significant shift in the regulatory process, altering the long-standing autonomy of these agencies by subjecting them to executive oversight.
The Order asserts that independent agencies should not be exempt from executive supervision, citing Article II of the U.S. Constitution. According to the related White House fact sheet, the Order seeks to align the regulatory activities of independent agencies with the Trump administration's priorities, and ensure consistency across the executive branch. While the Order applies broadly to independent agencies, it explicitly exempts the Federal Reserve's monetary policy functions.
Some key provisions of the Order include:
- Presidential Review Requirement. Independent agencies must submit proposed regulations for review by the White House before adoption.
- Interpretation of Law. The President and Attorney General will interpret the law for the executive branch to prevent agencies from issuing conflicting legal positions.
- Coordination with the White House. All agencies must consult with the White House to align their strategic plans and regulatory priorities with the administration's policy goals.
- Budgetary Oversight. The Office of Management and Budget will have oversight authority over the budgets of independent agencies to ensure "tax dollars are spent wisely."
Putting It Into Practice: The Order is part of a broader effort by the Trump administration to increase control over independent federal agencies. The Order argues that "Article II of the U.S. Constitution vests all executive power in the president, meaning that all executive branch officials and employees are subject to his supervision." The Order is likely to be challenged as it marks a dramatic shift from the current administrative regulatory framework. We will continue to monitor the news for any developments.
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