A Regulatory Law Definition: How It Limits Agency Powers

By Ilan Fuchs, Ph.D.  |  08/15/2023

Regulatory law, more commonly referred to as administrative law, is one of the most important fields of law in modern society. However, regulatory law definition has grown with the evolution of economics, science, and technology.

What Is Regulatory Law?

Regulatory law deals with regulations, the edicts created by an executive branch agency. These edicts are different than laws since they are passed by that executive branch agency, based on the authority given to it by Congress through a law.

A regulation, however, is secondary to a law and cannot contradict it. Federal agencies are given the authority to execute the laws created by Congress and also have the ability to issue regulations that control the implementation of these laws.

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Regulations Passed by Federal Agencies

Regulatory law deals with the scope of regulations passed by federal agencies. It also ensures that these federal agencies do not overstep and take action that comes under the purview of the U.S.'s legislative branch.

This idea is called the nondelegation doctrine. It is a principle in constitutional law that states that the legislative branch of the U.S. government (Congress) cannot delegate its legislative authority to the executive branch (the President and federal agencies). The President can only fill in regulatory gaps with the use of executive orders once the legislative authority of Congress has finished its role in making laws.

The judicial branch of the U.S. government (the Supreme Court) also has a role. It is asked to decide when regulatory agencies overstep their bounds and their actions require legislative approval.

Federal Regulations

The federal government makes rules all the time. As the services provided by the federal government grow, so does the need for regulation.

The biggest leap forward for federal regulations came around during the FDR era. The New Deal meant that government agencies were tasked with helping millions of Americans, so administrative laws were passed to regulate the many services provided by these agencies.

The “big government” model has been an issue of debate ever since. Conservative jurists have always objected to the growing role of federal regulations passed by agency officials who are not elected and who make rules and regulations without the consent of voters.

Supreme Court Decisions Regarding Regulatory Law

The Supreme Court sometimes review actions related to regulatory law - determining whether the rules, regulations, or policies they've set exceed their mandate and should be ratified by Congress. This calls upon Congress to craft legislation more precisely, limiting the scope for administrative interpretation.

The key case here is Chevron U.S.A. Inc. v. Natural Resources Defense Council, which laid down a two-step test for judicial review of an agency's interpretation of a statute. First, the court determines if Congress has explicitly addressed the contested issue in the statute. If yes, barring Constitutional issues, that's conclusive. If not, the court must ascertain if the agency’s interpretation is reasonable.

The resulting "Chevron doctrine," widely discussed in case law, is contested by conservative jurists who argue it grants excessive power to administrative agencies. Predictably, the "Chevron Doctrine" may be curtailed in future, with a call for agencies to seek Congressional approval more frequently to legally establish their proposed rules, reducing agency discretion.

Environmental Protection Agency: A Challenge to Regulatory Law and Federal Agency Decisions

Federal laws birth government agencies with specific roles. A prime example is the Environmental Protection Agency, tasked by The Clean Water Act of 1972 to protect US waters. However, the once overstepped this duty, leading to the Sackett v. EPA case, where the Supreme Court deemed their actions overly broad.

Presidential executive orders can direct executive actions, bypassing the legislature, yet are open to judicial review.

All rules must be published. Once permanent regulations from agencies appear in the Federal Register, they're effective. Then, those adversely affected can challenge these as exceeding the agency's purview. Courts can then uphold or demand legislative approval for the regulation.

Administrative Agencies and Internal Legal Procedures

Administrative law primarily involves adjudication decisions by administrative agencies. The Constitution allows the judiciary to make decisions, but federal courts have clarified when administrative decisions can be judicially made.

Administrative law judges, appointed by agencies, conduct hearings that may diverge significantly from regular trial procedures. They don't operate under the U.S. Constitution's Article 3, which empowers courts to handle federal law cases; this is reserved for Congress-appointed judges.

U.S. agencies can rule that evidence laws are inapplicable to their hearings, potentially permitting evidence that a traditional court would reject. The administrative hearing laws and rules differ by agency; one might accept hearsay, while another won't.

Some agencies allow only attorneys to represent respondents, while others permit organizations assisting impoverished clients to do so, even without using lawyers. Social service agencies often allow non-lawyers to aid respondents. Therefore, a respondent should familiarize themselves with the agency-specific laws and rules before a hearing, as they likely vary from other agencies.

Administrative Law and Public Interest

Public interest groups can accomplish goals through administrative decisions, circumventing legislative delays. As some federal bodies assume broad power, they form regulatory plans to tackle issues stalled by political impasses in Congress.

Take for example, President Biden's executive order for gun reform. It demonstrates how the President can utilize laws to address public health issues like the misuse of firearms.

However, conservative jurists often challenge regulatory laws. They argue these laws are politically manipulated by agencies, lacking solid statutory backing. Keeping pace with advancements in science, tech, and economics, crafting precise statutory laws is complex.

While necessary, regulatory laws need careful construction to prevent misunderstandings. To ensure new rules in the Federal Register abide by federal agencies' scope and don't need legislative approval, ongoing dialogue across all three U.S. government branches is vital.

Policy Making and Enforcement

Federal agencies undergo a process to approve proposed rules, typically guided by the Administrative Procedure Act (APA). The Supreme Court often reviews if laws align with APA standards. Rulemaking begins with publication in the Federal Register, inviting public feedback. The agency then considers this feedback before finalizing laws.

The Negotiated Rulemaking Act of 1990 offers another method, where agencies negotiate with interested parties to draft a rule. Agencies can enforce laws through processes like licensing and adjudication, as demonstrated by the Equal Employment Opportunity Commission and Securities and Exchange Commission. However, enforcement is subject to judicial review and can be overturned for insufficient due process, among other issues. This makes administrative law one of the fields that have a direct effects on citizens lives in their interaction with the federal government, the Judicial branch and local administrative agencies.

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The Master’s Degree in Legal Studies at American Public University (APU) delves into the complexities of the American legal system, helping to equip students with knowledge of legal principles and procedures. The course structure covers Constitutional law, administrative law, and more.

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The University tailors their class schedules to be asynchronous, allowing students to complete coursework at their own pace. This flexible approach provides an opportunity for students to balance their studies alongside personal and professional commitments, making the pursuit of higher education more accessible.

Expert Faculty

Many APU professors boast real-world experience in the field of law. Their professional insights help to provide students with a unique understanding of the practical aspects of legal studies, supplementing academic theory with concrete examples. This synergistic blend of theory and practice helps to enhance the educational experience at American Public University.

American Public University also offers a Bachelor's Degree in Legal Studies.