[Federal Register Volume 88, Number 85 (Wednesday, May 3, 2023)]
[Notices]
[Pages 27894-27896]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-09247]


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FEDERAL TRADE COMMISSION


Horseracing Integrity and Safety Act: Anti-Doping and Medication 
Control Rule

AGENCY: Federal Trade Commission.

ACTION: Notice of Horseracing Integrity and Safety Authority (HISA) 
final rule; delay of effectiveness.

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SUMMARY: The Federal Trade Commission modifies the Horseracing 
Integrity and Safety Authority's Anti-Doping and Medication Control 
Rule by extending its date of effectiveness until May 22, 2023.

DATES: As of May 3, 2023, the date of effectiveness for the Horseracing 
Integrity and Safety Authority's Anti-Doping and Medication Control 
Rule is delayed to May 22, 2023.

FOR FURTHER INFORMATION CONTACT: John H. Seesel (202-326-2702), 
Attorney, Office of the General Counsel, Federal Trade Commission, 600 
Pennsylvania Avenue NW, Washington, DC 20580.

SUPPLEMENTARY INFORMATION: 

I. Reason for Delay of HISA's Final Rule

    The Horseracing Integrity and Safety Act of 2020, 15 U.S.C. 3051-
3060 (``Act''), tasks a self-regulatory nonprofit organization, the 
Horseracing Integrity and Safety Authority (``Authority''), with 
developing proposed rules on a variety of subjects. See 15 U.S.C. 
3053(a). Those proposed rules take effect only if approved by the 
Federal Trade Commission, see 15 U.S.C. 3053(b)(2), which must approve 
the proposed rules if it finds that they are consistent with the Act 
and with applicable rules approved by the Commission, see 15 U.S.C. 
3053(c)(2). The Commission, however, may by rule abrogate, add to, or 
modify the Authority's rules ``as the Commission finds necessary or 
appropriate to ensure the fair administration of the Authority, to 
conform the rules of the Authority'' to the Act's requirements or 
applicable rules approved by the Commission, ``or otherwise in 
furtherance of the purposes of this Act.'' Id. sec. 3053(e).
    On March 27, 2023, the Commission issued an Order (``Order'') 
approving the Authority's proposed Anti-Doping and Medication Control 
(``ADMC'') Rule. Pursuant to that Order, the ADMC Rule took effect 
immediately upon the Commission's approval, i.e., on March 27, 2023.\1\
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    \1\ See Fed. Trade Comm'n, Order Approving the Anti-Doping and 
Medication Control Rule Proposed by the Horseracing Integrity & 
Safety Auth. (Mar. 27, 2023), https://www.ftc.gov/system/files/ftc_gov/pdf/P222100CommissionOrderAntiDopingMedication.pdf.
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    On March 31, 2023, however, the United States District Court for 
the Northern District of Texas determined that the Commission had 
violated the Administrative Procedure Act by declaring the ADMC Rule 
effective immediately upon the issuance of the Commission's Order 
approving the Rule. Viewing the Commission's March 27 Order as 
tantamount to an agency's issuance of a substantive rule, the court 
found that the Commission should have delayed the date of effectiveness 
for the ADMC Rule for 30 days following approval. The court accordingly 
enjoined implementation or enforcement of the ADMC Rule until May 1, 
2023.\2\
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    \2\ Nat'l Horsemen's Benevolent & Protective Ass'n et al. v. 
Jerry Black et al., No. 5:21-CV-071-H, 2023 WL 2753978 (N.D. Tex. 
Mar. 31, 2023).
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    The district court's March 31 order has given rise to substantial 
uncertainty regarding the criteria and procedures under which anti-
doping and medication control protocols will be implemented as the 
Thoroughbred horseracing industry nears the Triple Crown events of May 
6 (Kentucky Derby), May 20 (Preakness Stakes), and June 10 (Belmont 
Stakes). With the date of effectiveness for the Authority's nationally 
applicable ADMC Rule

[[Page 27895]]

suspended by the district court until May 1, the conduct of anti-doping 
and medication control will remain under the jurisdiction of the 
various state racing authorities until that date, with the Authority's 
jurisdiction resuming only five days before the Kentucky Derby and 
nineteen days before the Preakness. Because the ADMC Rule governs the 
treatment of horses weeks before a covered race, some affected parties 
who are treating horses in a manner consistent with state requirements 
may find it difficult to come into compliance in the five days between 
the ADMC Rule's scheduled date of effectiveness and the Kentucky Derby 
on May 6.\3\ Even in the absence of conflicts between the ADMC Rule and 
applicable state regulations, implementing new testing requirements 
just days before the start of the Triple Crown creates an appreciable 
risk of errors, confusion, and inconsistent treatment of similarly 
situated horses--harms that could frustrate the purposes of the Act.
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    \3\ Compare, e.g., ADMC Rule 4222 (prohibiting all intra-
articular injections within fourteen days of post time) with 
Kentucky Horse Racing Commission Withdrawal Guidelines: 
Thoroughbred; Standardbred; Quarter Horse, Appaloosa, and Arabian, 
KHRC 8-020-2 (04/2020) (prohibiting intra-articular injection of 
specified substances within fourteen days of post time), available 
at https://khrc.ky.gov/Documents/8-020-2-Withdrawal%20Guidelines%20%20Copy.pdf.
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    In light of these policy concerns, the Commission finds it 
necessary to modify HISA's ADMC Rule, pursuant to the recently revised 
15 U.S.C. 3053(e), to ensure the ``fair administration of the 
Authority'' and otherwise in furtherance of the Act's purposes. 
Accordingly, pursuant to the authority granted to the Commission by 15 
U.S.C. 3053(e), the Commission issues this document delaying the date 
of effectiveness for the Horseracing Integrity and Safety Authority's 
Anti-Doping and Medication Control Rule until May 22, 2023.

II. Administrative Procedure Act

    As noted above, the Act authorizes the Commission to abrogate, add 
to, or modify the Authority's rules for specified reasons, including 
``to ensure the fair administration of the Authority.'' 15 U.S.C. 
3053(e). This provision authorizes Commission rulemaking pursuant to 
section 553 of Title 5, the Administrative Procedure Act (APA). The APA 
typically provides for notice-and-comment rulemaking, but under section 
553(b)(3)(B) of the APA, general notice and the opportunity for public 
comment are not required with respect to a rulemaking when an ``agency 
for good cause finds (and incorporates the finding and a brief 
statement of reasons therefor in the rules issued) that notice and 
public procedure thereon are impracticable, unnecessary, or contrary to 
the public interest.'' \4\
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    \4\ 5 U.S.C. 553(b)(3)(B).
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    Here, the Commission finds, for good cause, that notice and comment 
is impracticable and unnecessary with respect to the document. Given 
the short time remaining before commencement of the Triple Crown races, 
providing advance notice would delay the effect of HISA's final rule 
until after the Kentucky Derby, defeating the rule's purpose. Obtaining 
comments after issuance of the rule is unnecessary because the full 
effect of the Commission's rule--which merely provides for a brief 
delay in the date of effectiveness for the ADMC Rule--will have 
occurred prior to the Commission's collection and consideration of any 
comments.
    For these reasons, the Commission finds that there is good cause 
consistent with the public interest to issue the document without 
notice and comment.\5\ The Commission therefore issues the document 
without prior notice and comment.
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    \5\ Id.
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    The APA also requires a 30-day delayed effective date, except for 
``(1) substantive rules which grant or recognize an exemption or 
relieve a restriction; (2) interpretative rules and statements of 
policy; or (3) as otherwise provided by the agency for good cause.'' 
\6\ For the same reasons noted with regard to notice and comment, and 
because extending the date of effectiveness for the ADMC Rule relieves 
a restriction, the Commission finds there is good cause for its 
document to take effect immediately.
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    \6\ Id. at 553(d).
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III. Paperwork Reduction Act

    In accordance with the requirements of the Paperwork Reduction Act 
(PRA), an agency may not conduct or sponsor, and a respondent is not 
required to respond to, an information collection unless it displays a 
currently valid Office of Management and Budget control number. This 
document issued by the Commission--which addresses solely the date of 
effectiveness for the Authority's ADMC Rule--does not involve any 
collection of information pursuant to the PRA.

IV. Regulatory Flexibility Act and Congressional Review Act

    The Regulatory Flexibility Act (RFA), 5 U.S.C. 601-612, requires 
that the Commission provide an Initial Regulatory Flexibility Analysis 
(IRFA) with a proposed rule and a Final Regulatory Flexibility Analysis 
(FRFA), if any, with a final rule. However, this obligation does not 
apply when an agency for good cause determines that a rulemaking is not 
subject to notice and comment. See, e.g., Or. Trollers Ass'n v. 
Gutierrez, 452 F.3d 1104, 1123-24 (9th Cir. 2006). The Commission finds 
that good cause exists for adopting this document without advance 
public notice or an opportunity for public comment. Because notice and 
comment are not statutorily required, the requirement to publish an 
analysis under the RFA does not apply to this document.
    Pursuant to the Congressional Review Act (5 U.S.C. 801 through 
808), the Office of Information and Regulatory Affairs has said that it 
would presumptively treat the type of rulemaking that the Commission 
announces today as not a ``major rule'' (as defined in 5 U.S.C. 
804(2)). The Commission occasionally extends a compliance date for a 
new rule or rule amendment to give entities additional time to prepare 
for compliance. For example, in 2010, the FTC extended the compliance 
date for its Energy Labeling Rule (16 CFR part 305) (formerly, 
Appliance Labeling Rule) to give regulated entities additional time to 
incorporate new labeling requirements for light bulbs into product 
packaging. See 75 FR 81943 (Dec. 29, 2010); 76 FR 20233 (Apr. 12, 
2011). The Office of Management and Budget has previously designated 
such extensions as ``not major.'' Because such amendments merely defer 
the expected economic effects of a previously adopted rule, any costs 
and benefits associated with the compliance date extension should be 
incremental to those already considered in connection with the 
promulgation of the underlying rule. For similar reasons, the relief 
should not result in major cost increases or significant adverse 
effects on competition, investment, or innovation. In addition, for 
purposes of this category, presumptively ``not major'' rules would be 
those in which the compliance date extension is limited to not more 
than one year, which will further serve to limit the economic impact of 
such extensions. The three-week extension of the ADMC Rule's date of 
effectiveness satisfies this criterion.
    For the reasons stated above, the Federal Trade Commission extends 
the date of effectiveness for the Horseracing Integrity and Safety 
Authority's Anti-Doping and Medication Control Rule to May 22, 2023.


[[Page 27896]]


    By direction of the Commission.
April J. Tabor,
Secretary.
[FR Doc. 2023-09247 Filed 5-2-23; 8:45 am]
BILLING CODE 6750-01-P