Federal authority over, and conduct of, customs- and trade-related rulemakings could be further muddied by a recent State Department notice.
In a public notice dated Feb. 21 and published in the March 14 Federal Register, Secretary of State Marco Rubio announced his determination that “all efforts, conducted by any agency of the federal government, to control the status, entry, and exit of people, and the transfer of goods, services, data, technology, and other items across the borders of the United States, constitute a foreign affairs function of the United States under the Administrative Procedure Act., 5 U.S.C. 553, 554.”
5 USC 553 requires federal agencies to (1) give at least 30 days’ public notice in the Federal Register of proposed changes to their regulations (with some exceptions), and (2) allow a period for public comment on proposed rules. 5 USC 554 provides that “in every case of adjudication required by statute to be determined on the record after opportunity for an agency hearing,” federal agencies must timely notify interested parties of such hearings and afford them an opportunity for comment. However, neither of these provisions applies with respect to “the conduct of military or foreign affairs functions.”
By designating customs- and trade-related regulatory efforts as foreign affairs functions, Rubio’s notice thus appears to exempt such efforts from these statutory transparency requirements. This could mean that future rulemakings from U.S. Customs and Border Protection and other agencies that affect customs and trade could be issued, and take effect, with no warning to the trade community.
Rubio defended his determination by asserting that the U.S. must “marshal all available resources and authorities” to counter “threats to U.S. citizens from an unsecured border” that include “foreign spies, contraband, and harmful materials that flow across the border, as well as unchecked mass migration, narcotics trafficking, human smuggling and trafficking, and other destabilizing or unlawful activities, including the flow of dangerous drugs, weapons, and technology.”
Rubio further asserted his authority to issue this determination by stating that the State Department “enjoys primacy among federal agencies in the conduct of our foreign policy.” While historically that has meant State’s oversight of “all policy related to the protection and travel of U.S. citizens overseas, visa operations and visa issuance, implementation of the Arms Export Control Act, and implementation of the Mutual Educational and Cultural Exchange Act of 1961,” among other things, Rubio claimed that “the scope of a foreign affairs function of the United States is much broader.”
However, Rubio’s determination is likely to be challenged in court. The government asserted the foreign affairs exemption as a justification for its APA failures in an ongoing case challenging the first Trump administration’s Section 301 tariffs on certain imports from China but the Court of International Trade rejected that argument, noting among other things that the purpose of the exemption “is to allow more cautious and sensitive consideration of those matters that so affect relations with other governments that, for example, public rulemaking provisions would provoke definitely undesirable international consequences.” Rubio’s claim seems to be a stretch to meet that criterion.
More broadly, the determination stands in opposition to the Constitution’s express grant of power to Congress to regulate foreign commerce absent a specific delegation of authority, such as the Trade Act of 1974, to address unfair trade practices. Judicial challenges to this blatant assertion of executive branch authority and circumvention of the APA are therefore likely on the horizon.
Copyright © 2025 Sandler, Travis & Rosenberg, P.A.; WorldTrade Interactive, Inc. All rights reserved.