How Agencies Should Use Waivers and Exemptions

Think of administrative agencies, and you often think of their efforts to enforce the law, such as environmental regulators fining polluters or financial regulators taking inside traders to court. In fact, agencies sometimes do just the opposite: They excuse parties from compliance. Agencies can use either prospective waivers or exemptions to excuse regulated entities from compliance. How and when agencies use these tools is the subject of a set of recommendations recently adopted by the Administrative Conference of the United States (ACUS). The topic can be tricky. On the one hand, waivers and exemptions can be good things. After all, agencies often need to grant flexibility when circumstances require. Emergencies like Hurricane Sandy, for instance, have prompted the Federal Transit Administration to issue “blanket waivers for several statutory and regulatory provisions.” New technologies, like “unmanned aircraft systems,” or drones, similarly demand…

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