Smart Regulation Overlapping Agency Jurisdiction


Federal regulations play a crucial role in ensuring that the products we consume are safe; the environment in which we live is clean; and the markets we depend on are fair, transparent and competitive. Business Roundtable recognizes that a sound federal regulatory system is critical to protect American consumers and strongly supports this important policy goal.

At times, however, multiple federal agencies are responsible for overseeing a given market activity, creating the potential for inefficiency. Such regulatory overlap poses significant challenges to American businesses and can dampen economic activity across the wider U.S. economy. Regulatory overlap can inflict real costs on businesses through repetitive inspections and data collection efforts and is particularly burdensome when agencies issue conflicting rules with inconsistent standards. Examples drawn from the food manufacturing, surface transportation and financial sectors demonstrate how overlapping regulatory jurisdiction results in higher costs, increases policy uncertainty, erects new barriers to entry and reduces competitiveness — which, in turn, stifles job creation, innovation and investment. Within the U.S. federal system, additional regulation at the state and local levels often exacerbates these challenges.

Almost every U.S. President since Herbert Hoover, including Presidents George W. Bush and Barack Obama, has recognized such challenges and taken steps to improve regulatory efficiency and effectiveness, testifying to the bipartisan nature of this issue. Over the past two years, the Trump Administration has also demonstrated a clear commitment to regulatory reform and addressing regulatory overlap. President Trump’s Regulatory Freedom Agenda, guided by Executive Orders 13771, 13777 and 13781, highlights the Administration’s interest in advancing solutions to regulatory challenges, and regulatory activity over the past two years has reflected this objective. In response, agencies have initiated collaborative efforts intended to improve coordination and reduce overlap across their regulatory activities. For example, over the past two years at least 18 federal departments and agencies have established notable memoranda of understanding that are designed to address the issue of regulatory overlap. These reform efforts have extended across a variety of industrial sectors, including food manufacturing, surface transportation and financial services.

S&P Global President & CEO Doug Peterson on Reducing Regulatory Overlap

Doug Peterson, Chair of the Business Roundtable Smart Regulation Committee, joined Bloomberg Daybreak to discuss economic challenges posed by regulatory overlap and potential solutions to create a smarter, more dynamic U.S. regulatory system.

While recent progress is encouraging, more work is needed to reduce unnecessary regulatory overlap. Legislative action to clarify the jurisdictions of various federal agencies is often the most effective and lasting intervention, but additional executive action can help address the problem. To that end, Business Roundtable encourages the President and federal agencies to identify instances of overlap across the U.S. regulatory framework and employ the procedural measures laid out in "Reducing Regulatory Overlap in the 21st Century" to efficiently and effectively address that overlap.

This new direction, which can be accomplished through an executive order or a Presidential memorandum, should also be applied in a forward-looking manner to avoid new instances of overlap that may arise as U.S. businesses and entrepreneurs continue to innovate using the latest technologies. Anticipating the potential for regulatory overlap in emerging industries and taking steps to avoid it will help ensure that U.S. businesses continue to serve as global leaders in innovation — which, in turn, will drive sustainable, long-term economic growth that benefits all Americans.

The imperative to improve regulatory efficiency is clear: The President, Congress and federal regulators should work together to build a 21st century regulatory system that encourages investment, innovation and growth; minimizes overlap; and preserves a healthy, clean and safe America.