President Trump issued Jan. 30 an executive order on reducing federal regulation that could impact the trade community. This order appears to be part of Trump’s avowed goal of eliminating “a little more than 75 percent” of existing regulations.

The order states that “unless prohibited by law, whenever an executive department or agency publicly proposes for notice and comment or otherwise promulgates a new regulation, it shall identify at least two existing regulations to be repealed.” In addition, “any new incremental costs associated with new regulations shall, to the extent permitted by law, be offset by the elimination of existing costs associated with at least two prior regulations.” The elimination of existing regulations must also be done via notice and comment, which can take months if not longer.

The order directs the head of the Office of Management and Budget to provide federal agencies with guidance addressing issues such as processes for standardizing the measurement and estimation of regulatory costs; standards for determining what qualifies as new and offsetting regulations; standards for determining the costs of existing regulations that are considered for elimination; processes for accounting for costs in different fiscal years; methods to oversee the issuance of rules with costs offset by savings at different times or different agencies; and emergencies and other circumstances that might justify individual waivers of the order’s requirements. The order also requires OMB to consider phasing in and updating these requirements.

Further, the order requires OMB to notify each federal agency each year of the total amount of incremental costs it will be allowed in issuing and repealing regulations for the next fiscal year. No regulations exceeding the agency's allowance will be permitted in that fiscal year unless required by law or approved in writing by OMB. For fiscal year 2017, which runs through Sept. 30, the total incremental cost of all new regulations is zero.

This order does not apply to regulations associated with national security or foreign affairs functions; regulations related to agency organization, management, or personnel; or any other category of regulations exempted by OMB.

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