With President-elect Donald Trump's announcement that he will appoint Elon Musk and Vivek Ramaswamy to the Department of Government Efficiency, attention has focused on the Biden administration's plans to ease regulations on areas such as the environment and the economy. Every interest group in Washington has a wish list of regulations they would like to see repealed or waived. But repealing and replacing regulations is not as simple as signing a few executive orders.
Deregulation can be just as onerous as regulation, especially if the new administration wants to do so to overcome inevitable legal challenges under the Administrative Procedure Act. For those following President Trump's deregulatory policies, there are several important issues to note.
As soon as Trump takes office, he will immediately freeze the regulatory process until a nominee is chosen. This typically includes a memo from the incoming chief of staff instructing federal agencies not to submit new rules for publication in the Federal Register until they are reviewed and approved by Trump's presidential appointees. The “freeze” memo also directs agencies to withdraw any rules that have been submitted but have not yet been published and to postpone the effective date of any rules that have not yet taken effect for 60 days.
This traditional measure enforces the norm of only one president at a time and ensures that President Biden's regulatory control ends during his term. However, President Trump cannot be allowed to go back to the law and rescind officially promulgated regulations. To do so, he will rely on a different set of tools: the Congressional Review Act, the regulatory process itself, and litigation under the Administrative Procedure Act.
The Congressional Review Act of 1996 was enacted before Trump first took office, but it was rarely used. It's in its prime now. Simply put, the CRA allows Congress to disapprove federal regulations by passing resolutions that are not subject to the Senate filibuster but are subject to a presidential veto. . So it's strongest when the same party controls the White House and Congress, as Republicans did in 2017 and again this year. If Congress rejects a regulation, the CRA will order that the regulation “shall not be reissued in substantially the same form.”
However, there are limitations to using the CRA for regulatory relief. With narrow exceptions, Congress can only object if it disapproves of regulations promulgated in the last months of the previous administration. Congress would also have a limited time in early 2025 to introduce a resolution of disapproval and move forward with the process, wasting valuable legislative time. Congress would only use it for high-priority goals.
But President Trump will likely want to loosen many regulations beyond the CRA's reach. In most cases, Biden will use the same rule-making process to eliminate regulations that he used to introduce them. In 2009, the Supreme Court ruled in FCC v. Fox Television that federal agencies are generally free to repeal or replace old rules as long as they approve of the change and provide a good reason for the new approach. was lowered. However, interested parties retain the same rights to sue and challenge deregulation under the Administrative Procedures Act.
To withstand judicial scrutiny, deregulatory measures and agency justifications must not be unconstitutional, contrary to law, or arbitrary and capricious. For example, in the 2020 case DHS v. Regents, the Supreme Court struck down the Trump administration's repeal of child immigration deferrals. Not because we disagreed with the Attorney General's conclusion that it was illegal, but because the Acting DHS Secretary disagreed. Appropriately describe the revocation as “arbitrary and capricious.”
Once again, the Trump administration will likely act to remove regulations it deems illegal, but it is unlikely to rely solely on that basis. Even if the primary justification for repeal is that the regulation exceeds the agency's statutory authority, deregulatory measures are expected to address additional considerations. The incentive to do so is even stronger after the Supreme Court's recent decision in Roper Bright v. Raimondo. Federal courts will no longer be allowed so-called Chevron deference to federal agencies' legal interpretations of their legal authority.
For private entities that have already filed (or are planning to file) a lawsuit challenging the Biden-era regulations, the last resort is through the Administrative Procedure Act itself. In some cases, the law would authorize authorities to postpone the effective date of regulations pending judicial review. But there are still unresolved questions, including whether the law allows agencies to delay rules that are already in effect and how much justification agencies must provide for delays. There are also legal issues.
In many cases, it is expected that the Trump administration will change its position and agree with the challengers that the previous rules were invalid for some reason. The first Trump administration reversed its position on the Supreme Court on class action immunity and other regulatory issues in 2017, and the Biden administration made a similar move in 2021.
Generally, a change in position alone is not sufficient for a court to invalidate a rule. But the Trump administration could effectively end the regulation by dropping the appeal, especially if a court has already ruled against the regulation and the Biden administration is pending an appeal. . Many courts will also suspend litigation over Biden-era rules. This is to give the Trump administration time to reconsider.
Mr. Trump has the tools necessary to pursue his deregulatory agenda. It takes thoughtful and sustained effort to pull it off.
John Moran is a partner in the Washington, DC office of McGuireWoods LLP. He served as White House deputy general counsel and senior Justice Department official during the first Trump presidential transition.
