The Trump Administration issued its Executive Order on Regulatory Relief to Support Economic Recovery (the “EO”) on May 19, 2020 (Executive Order). The EO seeks to remedy the economic impact of the ongoing COVID-19 pandemic by removing certain administrative barriers and providing flexibility in the implementation and enforcement of other administrative provisions and requirements.
Although certain provisions of the EO are vague, Section 1 states the EO’s policy that “Agencies should address this economic emergency by rescinding, modifying, waiving, or providing exemptions from regulations and other requirements that may inhibit economic recovery, consistent with applicable law and with protection of the public health and safety, with national and homeland security, and with budgetary priorities and operational feasibility.”
Section 4 of the EO asks the heads of all federal government agencies to “temporarily or permanently rescind, modify, waive, or exempt persons or entities” from regulatory standards “that may inhibit economic recovery.” Significantly, Section 5(b) of the EO gives agency heads the discretion to “decline enforcement against persons and entities that have attempted in reasonable good faith to comply with applicable statutory and regulatory standards, including those persons and entities acting in conformity with a pre-enforcement ruling.” (Emphasis added.)
Of course, agencies must act within their statutory and regulatory frameworks and must also comply with the Administrative Procedure Act, but the EO potentially has broad implications across sectors and agencies, including for international trade. As an example of how this EO might affect certain trade issues, consider the following:
-Importers should not expect to be exempted from exercising reasonable care, paying duties, participating in antidumping or countervailing duty investigations, or complying with any other CBP, Commerce or ITC statutory or regulatory requirements. Per Section 5(b) of the EO, Agency heads have enforcement discretion “as permitted by law,” meaning agency heads cannot override a statute, even if they believe that doing so would aid economic recovery. However, for matters that have already been placed within the “enforcement discretion” of an agency, the government has the ability to be more lenient in accordance with the EO. For instance, an agency could seek to enforce minimum penalties within a range of statutory options, although the agency could not ignore statutory requirements altogether.
-Similarly, if CBP discovered that certain imported apparel violated CPSC lead content standards, CBP and the CPSC could extend a more lenient resolution by permitting the shipment to be reconditioned or reexported rather than destroyed.
Another potential question is how evenly any leniency in trade and customs matters will be applied since the Trump administration has made tariffs and restrictions on Chinese imports and exports a pillar of its political platform. Because of the broad nature of the EO and because any action will be at the agency head’s discretion, we reiterate that it is difficult to determine the EO’s exact effects at this time. However, we can expect that affected companies and individuals will seek to use the flexibility and leniency provisions of the EO, effective immediately.
Julia Banegas is an attorney in Husch Blackwell LLP’s Washington, D.C. office.
Camron Greer is an Assistant Trade Analyst in Husch Blackwell LLP’s Washington D.C. office.