President Signs EO Promoting International Regulatory Cooperation

May 1: According to a blog posting from Cass Sunstein, the Administrator of the OMB Office of Information and Regulatory Affairs (OIRA), over the past year, the Federal Government has been working to implement President Obama's directions for a 21st-century regulatory system, which he described in Executive Order 13563, "Improving Regulation and Regulatory Review."  Executive Order 13563 requires U.S. regulators, to the extent permitted by law, to select approaches that maximize net benefits; choose the least burdensome alternative; increase public participation in the rulemaking process; design rules that are simpler and more flexible, and that provide freedom of choice; and base regulations on sound science. Executive Order 13563 also calls for an ambitious, government-wide "lookback" at existing rules, with the central goal of eliminating outdated requirements and unjustified costs.

    Today, President Obama has built on Executive Order 13563 by signing a historic Executive Order on Promoting International Regulatory Cooperation. The new Executive Order (EO) is designed to promote American exports, economic growth, and job creation by helping to eliminate unnecessary regulatory differences between the United States and other countries and by making sure that we do not create new ones.

Sunstein also wrote an op-ed in Wall Street Journal, indicating that the EO makes clear that in eliminating such differences, the U.S. will respect domestic law and will not compromise its priorities and prerogatives. Sunstein said, "Even while insisting on those priorities and prerogatives, we can eliminate pointless red tape. Today's global economy relies on supply chains that cross national borders (sometimes more than once), and different regulatory requirements in different countries can significantly increase costs for companies doing business abroad. As the President's Jobs Council recently noted, international regulatory cooperation can reduce these costs and help American businesses access foreign markets. Such cooperation can also help U.S. regulators more effectively protect the environment and the health and safety of the American people."

    The new Executive Order calls for, among other things, an interagency working group, chaired by OMB's OIRA, to provide a forum to foster greater cooperation and coordination of U.S. Government strategies, including those for promoting regulatory transparency, sound regulatory practices, and U.S. regulatory approaches abroad. The EO also requires Federal agencies, as part of the President's retrospective review initiative under Executive Order 13563, to consider regulatory reforms that eliminate unnecessary differences between the United States and its major trading partners.

    Sean Heather, vice president of the U.S. Chamber's Center for Global Regulatory Cooperation, issued a statement welcoming the new executive order saying, "Today's executive order marks a paradigm shift for U.S. regulators by directing them to take the international implications of their work into account in a consistent and comprehensive way. Fulfilling primary regulatory objectives such as health and safety is more complicated than ever due to the interconnected nature of the global economy. The result is that international cooperation is clearly in the interest of regulators and is now assuming a central role in framing good domestic regulatory policy.

    "This landmark executive order recognizes that good regulatory policy supports good trade policy. Dialogue between U.S. regulators and their foreign counterparts can avert unnecessary divergences in regulation that become 'behind the border' barriers to commerce and hinder the ability of U.S. companies to reach the 95% of the world's consumers that live beyond our borders. . . This executive order is the international riposte. We look forward to working with the Office of Information and Regulatory Affairs on further guidance in support of today's executive order."

    Access the blog posting with links to the EO, the WSJ op-ed and extensive additional related information (click here). Access the statement from the U.S. Chamber (click here). [#All]