From shipping to staffing, the Chamber and its partners have the tools to save your business money and the solutions to help you run it more efficiently. Join the U.S. Chamber of Commerce today to start saving.
Speaker Paul Ryan unveiled the House of Representative’s regulatory reform agenda highlighting the need for greater reform of technology and telecommunications regulation. The speaker’s Reducing Regulatory Burdens task force specifically called out the Federal Communications Commission (FCC) for its treatment of broadband providers as public utilities under Title II of the 1934 Communications Act and its general lack of transparency in rulemakings.
Speaker Ryan’s regulatory task force expressed concern with how the FCC’s “Open Internet” rules go beyond enforcing the core principles of net neutrality — to prevent broadband providers from blocking and slowing internet traffic or providing internet fast lanes to entities with which they have financial arrangements. The commission reclassified broadband providers like public utilities under Title II in order to enforce these core net neutrality principles.
Unfortunately, as noted by the Chamber, the commission now is on a regulatory tear claiming its Title II authority allows it to impose heavy-handed privacy regulations — an issue not within the original net neutrality principals — on broadband providers. FCC’s proposed onerous opt-in privacy rules create a regulatory digital divide between broadband providers and edge providers — who follow the light-touch self-regulatory privacy enforcement framework of the Federal Trade Commission. According to Moody’s Investor Services, the proposed opt-in rule and its regulatory imbalance presents an economic threat that could be “credit negative” for the broadband industry.
Speaker Ryan’s task force supports legislation put forth in the House Energy and Commerce Committee that would limit the FCC’s authority to regulate broadband providers beyond the core principles of net neutrality. Such legislation is a step in the right direction of restoring regulatory balance. In addition, the Chamber has also maintained that the Regulatory Accountability Act, which the Task Force praises and currently awaits Senate action after House passage, could have required the FCC to have engaged in a better net neutrality rulemaking that would not have dramatically changed the broadband industry overnight.
FCC Process Reform
The speaker’s task force highlighted the troubling trend that commission rulemakings lack adequate transparency. According to the task force:
The Federal Communications Commission operates largely in secret. In the FCC’s process, once a notice of proposed rulemaking is issued, the public is not permitted to see any of the commission’s work until the rules have been voted into law. Moreover, notices of proposed rulemaking do not always contain proposed rules. This leaves the public in the dark until the FCC has decided to share its new, enforceable rules with the world.
The commission’s broadband privacy rulemaking also exemplifies the woefully inadequate comment periods that were originally meant to enable the public and interested stakeholders to weigh in on rulemakings. The commission recently denied a petition by trade associations to extend the privacy rulemaking’s short 30-day comment period despite Democratic Commissioner Jessica Rosenworcel’s acknowledgment that the process required extended time due to its complexity.
The Chamber agrees with Speaker Ryan that the FCC must undergo reform with regard to its rulemakings. Speaker Ryan calls for enactment of the FCC Process Reform Act of 2015, which passed the House. The FCC Process Reform Act would require the FCC to conduct rulemakings to adopt policies to:
- Establish minimum comment periods.
- Ensure the public has notice and opportunity to respond to comments.
- Create deadlines for public notice.
- Institute procedures to include the specific language of proposed rules in proposed rulemaking notices.
The House regulatory agenda also calls for all agencies to conduct cost-benefit analyses. President Obama issued Executive Order 13563 on Jan. 18, 2011, requiring non-independent executive branch agencies to conduct a cost-benefit analysis to ensure that quantitative and qualitative costs and benefits are considered in an agency rulemaking.
The speaker’s task force correctly points out that the Executive Order unfortunately does not apply to independent agencies like the FCC. This makes passage of the Regulatory Accountability Act critical because the bill would require all agencies in the case of high-impact rules that cost the economy $1 billion or more annual — such as net neutrality — to adopt rules on the basis of the best evidence and the least cost.
The House of Representatives’ Reducing Regulatory Burdens task force speaks common sense to dysfunctional regulatory process at the Federal Communications Commission. Speaker Ryan’s regulatory agenda smartly calls for specific and sound modernization of the commission in addition to the much needed general structural reform addressed in the Regulatory Accountability Act.