[Federal Register Volume 84, Number 199 (Tuesday, October 15, 2019)]
[Presidential Documents]
[Pages 55239-55243]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-22624]
Presidential Documents
Federal Register / Vol. 84 , No. 199 / Tuesday, October 15, 2019 /
Presidential Documents
[[Page 55239]]
Executive Order 13892 of October 9, 2019
Promoting the Rule of Law Through Transparency
and Fairness in Civil Administrative Enforcement and
Adjudication
By the authority vested in me as President by the
Constitution and the laws of the United States of
America, it is hereby ordered as follows:
Section 1. Policy. The rule of law requires
transparency. Regulated parties must know in advance
the rules by which the Federal Government will judge
their actions. The Administrative Procedure Act (APA),
5 U.S.C. 551 et seq., was enacted to provide that
``administrative policies affecting individual rights
and obligations be promulgated pursuant to certain
stated procedures so as to avoid the inherently
arbitrary nature of unpublished ad hoc
determinations.'' Morton v. Ruiz, 415 U.S. 199, 232
(1974). The Freedom of Information Act, America's
landmark transparency law, amended the APA to further
advance this goal. The Freedom of Information Act, as
amended, now generally requires that agencies publish
in the Federal Register their substantive rules of
general applicability, statements of general policy,
and interpretations of law that are generally
applicable and both formulated and adopted by the
agency (5 U.S.C. 552(a)(1)(D)). The Freedom of
Information Act also generally prohibits an agency from
adversely affecting a person with a rule or policy that
is not so published, except to the extent that the
person has actual and timely notice of the terms of the
rule or policy (5 U.S.C. 552(a)(1)).
Unfortunately, departments and agencies (agencies) in
the executive branch have not always complied with
these requirements. In addition, some agency practices
with respect to enforcement actions and adjudications
undermine the APA's goals of promoting accountability
and ensuring fairness.
Agencies shall act transparently and fairly with
respect to all affected parties, as outlined in this
order, when engaged in civil administrative enforcement
or adjudication. No person should be subjected to a
civil administrative enforcement action or adjudication
absent prior public notice of both the enforcing
agency's jurisdiction over particular conduct and the
legal standards applicable to that conduct. Moreover,
the Federal Government should, where feasible, foster
greater private-sector cooperation in enforcement,
promote information sharing with the private sector,
and establish predictable outcomes for private conduct.
Agencies shall afford regulated parties the safeguards
described in this order, above and beyond those that
the courts have interpreted the Due Process Clause of
the Fifth Amendment to the Constitution to impose.
Sec. 2. Definitions. For the purposes of this order:
(a) ``Agency'' has the meaning given to ``Executive
agency'' in section 105 of title 5, United States Code,
but excludes the Government Accountability Office.
(b) ``Collection of information'' includes any
conduct that would qualify as a ``collection of
information'' as defined in section 3502(3)(A) of title
44, United States Code, or section 1320.3(c) of title
5, Code of Federal Regulations, and also includes any
request for information, regardless of the number of
persons to whom it is addressed, that is:
(i) addressed to all or a substantial majority of an industry; or
(ii) designed to obtain information from a representative sample of
individual persons in an industry.
[[Page 55240]]
(c) ``Guidance document'' means an agency statement
of general applicability, intended to have future
effect on the behavior of regulated parties, that sets
forth a policy on a statutory, regulatory, or technical
issue, or an interpretation of a statute or regulation,
but does not include the following:
(i) rules promulgated pursuant to notice and comment under section 553 of
title 5, United States Code, or similar statutory provisions;
(ii) rules exempt from rulemaking requirements under section 553(a) of
title 5, United States Code;
(iii) rules of agency organization, procedure, or practice;
(iv) decisions of agency adjudications under section 554 of title 5, United
States Code, or similar statutory provisions;
(v) internal guidance directed to the issuing agency or other agencies that
is not intended to have substantial future effect on the behavior of
regulated parties; or
(vi) internal executive branch legal advice or legal opinions addressed to
executive branch officials.
(d) ``Legal consequence'' means the result of an
action that directly or indirectly affects substantive
legal rights or obligations. The meaning of this term
should be informed by the Supreme Court's discussion in
U.S. Army Corps of Engineers v. Hawkes Co., 136 S. Ct.
1807, 1813-16 (2016), and includes, for example, agency
orders specifying which commodities are subject to or
exempt from regulation under a statute, Frozen Food
Express v. United States, 351 U.S. 40, 44-45 (1956), as
well as agency letters or orders establishing greater
liability for regulated parties in a subsequent
enforcement action, Rhea Lana, Inc. v. Dep't of Labor,
824 F.3d 1023, 1030 (DC Cir. 2016). In particular,
``legal consequence'' includes subjecting a regulated
party to potential liability.
(e) ``Unfair surprise'' means a lack of reasonable
certainty or fair warning of what a legal standard
administered by an agency requires. The meaning of this
term should be informed by the examples of lack of fair
notice discussed by the Supreme Court in Christopher v.
SmithKline Beecham Corp., 567 U.S. 142, 156 & n.15
(2012).
(f) ``Pre-enforcement ruling'' means a formal
written communication from an agency in response to an
inquiry from a person concerning compliance with legal
requirements that interprets the law or applies the law
to a specific set of facts supplied by the person. The
term includes informal guidance under section 213 of
the Small Business Regulatory Enforcement Fairness Act
of 1996, Public Law 104-121 (Title II), as amended
(SBREFA), letter rulings, advisory opinions, and no-
action letters.
(g) ``Regulation'' means a legislative rule
promulgated pursuant to section 553 of title 5, United
States Code, or similar statutory provisions.
Sec. 3. Proper Reliance on Guidance Documents. Guidance
documents may not be used to impose new standards of
conduct on persons outside the executive branch except
as expressly authorized by law or as expressly
incorporated into a contract. When an agency takes an
administrative enforcement action, engages in
adjudication, or otherwise makes a determination that
has legal consequence for a person, it must establish a
violation of law by applying statutes or regulations.
The agency may not treat noncompliance with a standard
of conduct announced solely in a guidance document as
itself a violation of applicable statutes or
regulations. When an agency uses a guidance document to
state the legal applicability of a statute or
regulation, that document can do no more, with respect
to prohibition of conduct, than articulate the agency's
understanding of how a statute or regulation applies to
particular circumstances. An agency may cite a guidance
document to convey that understanding in an
administrative enforcement action or adjudication only
if it has notified the public of such document in
advance through publication, either in full or by
citation if publicly available, in the Federal Register
(or on the portion of the agency's website
[[Page 55241]]
that contains a single, searchable, indexed database of
all guidance documents in effect).
Sec. 4. Fairness and Notice in Administrative
Enforcement Actions and Adjudications. When an agency
takes an administrative enforcement action, engages in
adjudication, or otherwise makes a determination that
has legal consequence for a person, it may apply only
standards of conduct that have been publicly stated in
a manner that would not cause unfair surprise. An
agency must avoid unfair surprise not only when it
imposes penalties but also whenever it adjudges past
conduct to have violated the law.
Sec. 5. Fairness and Notice in Jurisdictional
Determinations. Any decision in an agency adjudication,
administrative order, or agency document on which an
agency relies to assert a new or expanded claim of
jurisdiction--such as a claim to regulate a new subject
matter or an explanation of a new basis for liability--
must be published, either in full or by citation if
publicly available, in the Federal Register (or on the
portion of the agency's website that contains a single,
searchable, indexed database of all guidance documents
in effect) before the conduct over which jurisdiction
is sought occurs. If an agency intends to rely on a
document arising out of litigation (other than a
published opinion of an adjudicator), such as a brief,
a consent decree, or a settlement agreement, to
establish jurisdiction in future administrative
enforcement actions or adjudications involving persons
who were not parties to the litigation, it must publish
that document, either in full or by citation if
publicly available, in the Federal Register (or on the
portion of the agency's website that contains a single,
searchable, indexed database of all guidance documents
in effect) and provide an explanation of its
jurisdictional implications. An agency may not seek
judicial deference to its interpretation of a document
arising out of litigation (other than a published
opinion of an adjudicator) in order to establish a new
or expanded claim or jurisdiction unless it has
published the document or a notice of availability in
the Federal Register (or on the portion of the agency's
website that contains a single, searchable, indexed
database of all guidance documents in effect).
Sec. 6. Opportunity to Contest Agency Determination.
(a) Except as provided in subsections (b) and (c) of
this section, before an agency takes any action with
respect to a particular person that has legal
consequence for that person, including by issuing to
such a person a no-action letter, notice of
noncompliance, or other similar notice, the agency must
afford that person an opportunity to be heard, in
person or in writing, regarding the agency's proposed
legal and factual determinations. The agency must
respond in writing and articulate the basis for its
action.
(b) Subsection (a) of this section shall not apply
to settlement negotiations between agencies and
regulated parties, to notices of a prospective legal
action, or to litigation before courts.
(c) An agency may proceed without regard to
subsection (a) of this section where necessary because
of a serious threat to health, safety, or other
emergency or where a statute specifically authorizes
proceeding without a prior opportunity to be heard.
Where an agency proceeds under this subsection, it
nevertheless must afford any person an opportunity to
be heard, in person or in writing, regarding the
agency's legal determinations and respond in writing as
soon as practicable.
Sec. 7. Ensuring Reasonable Administrative Inspections.
Within 120 days of the date of this order, each agency
that conducts civil administrative inspections shall
publish a rule of agency procedure governing such
inspections, if such a rule does not already exist.
Once published, an agency must conduct inspections of
regulated parties in compliance with the rule.
Sec. 8. Appropriate Procedures for Information
Collections. (a) Any agency seeking to collect
information from a person about the compliance of that
person or of any other person with legal requirements
must ensure that such collections of information comply
with the provisions of the Paperwork Reduction Act,
section 3512 of title 44, United States Code, and
section
[[Page 55242]]
1320.6(a) of title 5, Code of Federal Regulations,
applicable to collections of information (other than
those excepted under section 3518 of title 44, United
States Code).
(b) To advance the purposes of subsection (a) of
this section, any collection of information during the
conduct of an investigation (other than those
investigations excepted under section 3518 of title 44,
United States Code, and section 1320.4 of title 5, Code
of Federal Regulations, or civil investigative demands
under 18 U.S.C. 1968) must either:
(i) display a valid control number assigned by the Director of the Office
of Management and Budget; or
(ii) inform the recipient through prominently displayed plain language that
no response is legally required.
Sec. 9. Cooperative Information Sharing and
Enforcement. (a) Within 270 days of the date of this
order, each agency, as appropriate, shall, to the
extent practicable and permitted by law, propose
procedures:
(i) to encourage voluntary self-reporting of regulatory violations by
regulated parties in exchange for reductions or waivers of civil penalties;
(ii) to encourage voluntary information sharing by regulated parties; and
(iii) to provide pre-enforcement rulings to regulated parties.
(b) Any agency that believes additional procedures
are not practicable--because, for example, the agency
believes it already has adequate procedures in place or
because it believes it lacks the resources to institute
additional procedures--shall, within 270 days of the
date of this order, submit a report to the President
describing, as appropriate, its existing procedures,
its need for more resources, or any other basis for its
conclusion.
Sec. 10. SBREFA Compliance. Within 180 days of the date
of this order, each agency shall submit a report to the
President demonstrating that its civil administrative
enforcement activities, investigations, and other
actions comply with SBREFA, including section 223 of
that Act. A copy of this report, subject to redactions
for any applicable privileges, shall be posted on the
agency's website.
Sec. 11. General Provisions. (a) Nothing in this order
shall be construed to impair or otherwise affect:
(i) the authority granted by law to an executive department or agency, or
the head thereof; or
(ii) the functions of the Director of the Office of Management and Budget
relating to budgetary, administrative, or legislative proposals.
(b) This order shall be implemented in a manner
consistent with applicable law and subject to the
availability of appropriations.
(c) This order is not intended to, and does not,
create any right or benefit, substantive or procedural,
enforceable at law or in equity by any party against
the United States, its departments, agencies, or
entities, its officers, employees, or agents, or any
other person.
(d) Notwithstanding any other provision in this
order, nothing in this order shall apply:
(i) to any action that pertains to foreign or military affairs, or to a
national security or homeland security function of the United States (other
than procurement actions and actions involving the import or export of non-
defense articles and services);
(ii) to any action related to a criminal investigation or prosecution,
including undercover operations, or any civil enforcement action or related
investigation by the Department of Justice, including any action related to
a civil investigative demand under 18 U.S.C. 1968;
(iii) to any action related to detention, seizure, or destruction of
counterfeit goods, pirated goods, or other goods that infringe intellectual
property rights;
[[Page 55243]]
(iv) to any investigation of misconduct by an agency employee or any
disciplinary, corrective, or employment action taken against an agency
employee; or
(v) in any other circumstance or proceeding to which application of this
order, or any part of this order, would, in the judgment of the head of the
agency, undermine the national security.
(Presidential Sig.)
THE WHITE HOUSE,
October 9, 2019.
[FR Doc. 2019-22624
Filed 10-11-19; 11:15 am]
Billing code 3295-F0-P