The Regulatory Week in Review: May 13, 2016
IN THE NEWS
- The Consumer Financial Protection Bureau (CFPB) proposed a new rule that would prohibit financial firms from using mandatory arbitration clauses in consumer contracts—clauses that were the subject of a highly critical New York Times investigation and that the CFPB says deny consumers’ rights to bring class action, even though advocates of arbitration say the clauses are a more expedient way to resolve legal disputes, and the clauses survived Supreme Court challenges in 2011 and 2013.
- The e-cigarette industry will be subject to federal regulation for the first time, now that the U.S. Food and Drug Administration (FDA) issued final rules that extend FDA authority to e-cigarettes and ban their sale to children under eighteen—a move applauded by public health experts, who say the industry needs oversight, but criticized by e-cigarette companies, who argue that the rules will overwhelm small businesses.
- The Occupational Safety and Health Administration (OSHA) issued a final rule that will require employers in dangerous fields like manufacturing and construction to provide electronic information about workplace injuries to OSHA, which the agency will then post online – a move designed to boost transparency and increase attention to workplace safety, and that OSHA likened to disclosure requirements for sanitary conditions at restaurants, but which the National Association of Manufacturers (NAM) contended will lead to “unnecessary public shaming” and sacrifice the privacy of employees and employers alike.
- The U.S. Food and Drug Administration (FDA) will move to re-evaluate the definition of the word “healthy” as it is used on nutrition labels, and may alter the current regulations, which stipulate that foods labeled as “healthy” have a very low level of fat—a move that comes after a back-and-forth with KIND over whether the company could still label its granola bars as “healthy” despite high saturated fat levels.
- The Federal Communications Commission (FCC) released its full order approving the massive merger of Time Warner Cable, Charter, and Bright House Networks and imposing numerous conditions on the deal, including capping and pricing of customer data usage – a deal that won the approval of three Democratic Commissioners, while Republican Commissioner Ajit Pai dissented, with his spokesperson elaborating that the conditions were overly burdensome and tantamount to “the government micromanaging the internet economy.”
- Following years of declining sales as consumers turn to online sellers, Staples and Office Depot were dealt a further blow when a federal judge blocked their proposed $6.3 billion merger – an injunction that was a win for the Federal Trade Commission (FTC), which had filed the lawsuit over concern that the deal would effectively eliminate competition in the office supplies industry, and led the two retailers to abandon their merger plans following the court’s decision.
- As part of the Obama Administration’s push to increase ex-convicts’ access to higher education, the Department of Education (DoED) released a comprehensive resource guide to aid colleges and universities in the transition process—the guide, which has been endorsed by Attorney General Loretta Lynch, provides alternatives to asking for an applicant’s criminal history during the admissions process, and suggestions for ensuring campus safety.
WHAT WE’RE READING THIS WEEK
- An American Automobile Association (AAA) study assessed the prevalence of marijuana-related traffic fatalities in the State of Washington, which legalized recreational marijuana use in December 2012 after the passage of Washington Initiative 502. After reviewing data obtained from the Washington Traffic Safety Commission, AAA concluded that “the proportion of drivers in fatal crashes who had detectable THC in their blood” was initially flat but “began increasing rapidly” about nine months after legalization, and approximately doubled from 2013 to 2014. The report comes as several states, including California and Florida, plan to consider legalization in the November 2016 election.
- In an opinion piece for TechTank, Stuart Brotman of the Brookings Institution discussed the importance of American leadership at this year’s World Summit on the Information Society (WSIS) Forum. Given the significant role the United States plays in the information and communications technology sector, and the fact that Ambassador and Deputy Assistant Secretary of State Daniel Sepulveda will serve as the chair of the forum, Brotman sees American leadership as key to setting the forum’s agenda and determining its political outcomes. Perhaps more importantly, in a “period when our domestic political debate seems to criticize U.S. leadership for ineffectively projecting power on the international stage,” Brotman believes the WSIS forum serves as an opportunity to evaluate the accuracy of that criticism.
- In an essay for the Mercatus Center at George Mason University, Professor Stuart Shapiro and Environmental Protection Agency economist Laura Stanley looked at the role of economists in federal regulatory agencies. The essay finds that economists located in program offices, as opposed to in departmental offices, have less influence on regulatory decision-making, and suggests that one correction to this could be giving program office economists more autonomy in producing regulatory impact analyses.