The Ensuring Accountability for All Agencies Executive Order (the “Independent Agency EO”), signed by President Trump on February 18, extends unprecedented direct Administration control over independent regulatory agencies, such as the Federal Communications Commission, the Securities and Exchange Commission, the Federal Trade Commission, and the Federal Energy Regulatory Commission, among others.1 The Independent Agency EO requires, inter alia, the submission of “major regulatory actions” of independent agencies to the Office of Management and Budget’s (OMB), Office of Information and Regulatory Affairs (OIRA) in the White House, imposing OIRA review and approval requirements on these agencies regulatory actions. Such review, to this point, has been limited to actions of cabinet-level executive branch departments (and their respective components and agencies), such as the Departments of Justice, Commerce, Agriculture, Homeland Security, Energy, and Transportation, over which the President has plenary authority, including with respect to their regulatory activities and actions, and the hiring and firing of political appointees, who serve at the President’s pleasure.
In addition, on February 19, the President signed a follow-on Executive Order to implement its Department of Government Efficiency (DOGE) deregulatory initiative (the “Deregulation EO”), directing all Agency heads, including those of independent agencies, to initiate a process to review all regulations under their jurisdiction for consistency with law and the Administration’s policy objectives. Agency heads were also directed, within 60 days (by April 20) to identify and submit to OIRA, regulations that are within one of seven classes that meet the Administration’s criteria for inconsistency with law and its policy objectives.
Key Takeaways:
- The Independent Agency EO purports to exert unprecedented direct presidential control over independent agencies, which were created by Congress as governmental agencies outside the President’s Administration in order to insulate them from direct political influence and control.
- The order requires White House review of agency action, likely to slow the regulatory process and create uncertainty for business, though also providing business with a second “bite at the apple” to pare back or outright block particular agency regulatory initiatives through the OIRA process.
- The Independent Agency EO, together with the Deregulation EO, are additional elements of efforts by the Trump Administration to limit the so-called “Administrative State”, and are simultaneously coupled with the assertion by the Administration of the President’s authority to remove independent agency heads and other political appointees at will, rather than for cause or under other criteria specified in the agency’s enabling statute. Challenges to two such removals are pending in federal court, and the acting U.S. Solicitor General has indicated in a letter to Senator Dick Durbin, ranking member of the Senate Judiciary Committee, that “certain for-cause removal provisions that apply to members of multi-member regulatory commissions are unconstitutional and that the Department [of Justice] will no longer defend their constitutionality.”
- Together, these initiatives could provide the Administration with the ability to exert more direct control and influence over independent agencies, including to advance various Administration priorities, most obviously surrounding DEI, green energy, political speech, and others that will come into focus over time. In addition, the Deregulation EO’s call for an accelerated review for consistency with the Administration’s deregulatory and other policy objectives could potentially prompt some unexpected initiatives from the independent agencies.
Background
Independent regulatory agencies are quasi-legislative bodies created by Congress, that are outside the Administration yet technically are considered within the executive branch of the federal government. Independent agencies have historically acted independently from oversight and direction from the President’s administration in their rulemaking and other activities, with their power delegated by Congress through the agency’s enabling statute. The extent of the President’s authority over independent agencies has generally been thought to be limited by the provisions of an agency’s enabling statute, which typically does not extend beyond the President’s authority to appoint agency heads and senior governing officials (such as commissioners and board members), with the advice and consent of the Senate.
The Supreme Court has long held that independent agency political appointees cannot be removed without cause or in accordance with an agency’s enabling statute, which is in contrast with executive department heads serving in the President’s cabinet and other executive department political appointees, who serve at the pleasure of the President and may be removed at will. The President is now asserting the authority to fire independent agency political appointees at will, an issue which is currently pending in two federal court cases, as discussed further below.
OIRA is an office within OMB tasked with, under the 1993 Regulatory Planning and Review EO 12866 (as supplemented by 2011 EO 13563), reviewing and approving executive agency regulatory actions, ensuring compliance with executive orders, and coordinating the Administration’s policies among the cabinet-level executive departments and their component agencies. Prior to the Independent Agency EO, under EO 12866, only the regulatory actions and activities of executive departments, their agencies and components have been subject to OIRA review, which excludes “independent regulatory agency” from the definition of “agency” for purposes of EO 12866 compliance.2
The Executive Order
The Independent Agency EO declares that “[i]t shall be the policy of the executive branch to ensure Presidential supervision and control of the entire executive branch,” which President Trump says includes “the so-called ‘independent regulatory agencies.’” In accordance with this policy, all proposed and final “significant regulatory actions” must be submitted to OIRA for review and approval before the action is published in the Federal Register, removing a major element of these agencies’ independence. The OIRA submission requirement kicks in April 19, 2025 (or sooner if OMB releases new guidance before that date).
The Independent Agency EO also:
- Details new protocols that OMB may coordinate and review with the agencies to ensure alignment with the Administration’s policies and agenda, including a provision directing OMB to establish performance standards for each independent agency head and requiring the periodic submission of reports to the president on each agency head’s “performance and efficiency.”
- Requires each independent agency to create a White House liaison position within their agency and coordinate its policies and priorities with the White House.
- Asserts that the President and Attorney General (subject to the President’s supervision), shall provide authoritative interpretations of law for the executive branch, and provides that no employee of the executive branch (which presumably includes employees of independent agencies) “may advance an interpretation of law as the position of the United States that contravenes the President’s and Attorney General’s opinion on the matter.”
Additional Considerations and Observations
As noted, the related question of whether the President may remove political appointees of an independent regulatory agency, which likewise implicates the authority of the President over these agencies, is simultaneously making its way through the courts, with the acting Solicitor General asserting in Congressional correspondence that the Department of Justice will no longer defend the constitutionality of for-cause removal provisions in independent agency enabling statutes. In one case pending before the U.S. District Court for the District of Columbia, the court temporarily stayed the President’s removal of the head of the Office of Special Counsel, with the Administration’s Application to the Supreme Court to vacate the stay held in abeyance pending further proceedings before the District Court on issuance of a preliminary injunction. In a second case, a challenge to the President’s firing of a member of the National Labor Relations Board is pending before a U.S. District Court in D.C., with an expedited briefing schedule and hearing set on the removed official’s motion for summary judgment.
It is not uncommon for independent agencies, whose head and majority (following appointments to vacancies) are typically of the President’s party, to align with the President on major policy initiatives. This can be seen, for example, from the on-again, off-again history of net neutrality’s treatment by the FCC, which has been directly connected to which party holds the presidency and the Chair and majority at the FCC. In recent comments to the press, FERC Chairman Mark Christie noted this typical pattern of alignment between the Administration in power and independent agencies on major initiatives and suggested that the majority of the consultation-related provisions of the Independent Agency EO appeared consistent with current practices, in some cases going back decades.
That said, what will be different under the Independent Agency EO, together with the authority of the President to fire independent agency heads at will if sanctioned by the Supreme Court, is that these agencies can be expected to become more of a direct instrument of the Administration in advancing its policy agenda. This can be seen most immediately from the FCC’s reported investigation into the DEI practices of an FCC-regulated entity, and the recent announcement by the FTC of an inquiry into policies of social media platforms affecting political speech. In addition, the Deregulation EO direction that all agencies, including independent agencies, identify regulations that are inconsistent with the Administration’s deregulatory and other policy objectives and develop a plan for rescinding or modifying those regulations, could potentially prompt some unexpected initiatives from the independent agencies but also could provide opportunities for regulated entities.
In terms of OIRA review, the executive order will likely slow the regulatory process and agency action, as publication in the Federal Register is to be delayed pending OIRA review for both proposed and final actions. This may be a “good news, bad news story” for businesses with issues before independent regulatory agencies. For those advocating for a particular position adopted by the agency, final action will likely be delayed and could be changed in the OIRA process. For those opposing particular agency action, the OIRA process, which includes consultation with other White House and Cabinet-level departments, as well as the ability of interested parties to comment and meet with OIRA on agency action under review, provides an additional opportunity to influence, and perhaps pare back or block, an agency proposal or final rule.
This order is likely to be subject to a court challenge, like other Trump Administration Executive Orders. Nevertheless, if your business is subject to the regulatory actions of these independent agencies, be prepared for an environment with some higher risks and uncertainty, but also for additional opportunity to engage with political actors in Congress and the Executive Branch, as well as the independent agencies themselves, to check agency action that may be adverse to your company’s interests.
1 The term “independent regulatory agency” is defined by statute in 44 U.S.C. § 3502(5) as the listed federal agencies in that section and “any other similar agency designated by statute as a Federal independent regulatory agency or commission.” In addition to the FCC, FTC, SEC, and FERC, independent agencies identified in that provision include the Federal Housing Finance Agency, the Federal Maritime Commission, the Interstate Commerce Commission (which was abolished in 1995, with the newly created Surface Transportation Board succeeding to its rail industry regulatory functions), the National Labor Relations Board, the Nuclear Regulatory Commission, and the Occupational Safety and Health Review Commission. The Independent Agency EO explicitly includes the Federal Election Commission, but excludes the Federal Reserve and its Federal Open Market Committee, though applies to Fed activities directly related to its supervision and regulation of financial institutions.
2 Separately, in a process that companies with business before independent agencies may be familiar with, OIRA has explicit statutory authority under the Paperwork Reduction Act, 44 U.S.C. 3501, et seq., to review actions of any executive department or other entity in the executive branch, as well as of independent regulatory agencies, that require the submission of information to the government, so-called “information collections”. OIRA review of agency information collections under the Paperwork Reduction Act, which is a statutory requirement, is separate and distinct from reviews of executive agency regulatory actions and activities under EO 12866, which has now been extended to independent regulatory agencies by the Independent Agency EO.