FTC Federal Register notice, Sept. 1, 1977, 42 FR 43973

Page 27

Title 16— Commercial Practices CHAPTER I— FEDERAL TRADE COMMISSION PART 1— GENERAL PROCEDURES Subpart B— Rules and Rulemaking Under Sec. 18(a)(1)(B) of the FTC Act As Amended by Public Law 93-637 T rade R egulation R ulemaking P rocedures AGENCY: Federal Trade Commission. ACTION: Final rule.

SUMMARY: This document establishes procedures for handling communications with respect to trade regulation rulemak­ ing proceedings to Commissioners or members of Commissioners’ personal staff by persons not employed by the Commission. It further clarifies that the entire rulemaking record is publicly available. These amendments are made in light of recent court decisions and are procedural in nature.

DATES: Effective date: September 1, 1977. Comments by; October 3, 1977. FOR FURTHER INFORMATION CON­ TACT:

Thomas A. Sheehan, Attorney, Office of General Counsel, Federal Trade Commission, 6th St. and Pennsylvania Ave., NW., Washington, D.C. 20580, (202-523-3990).

ADDRESSES: Send comments to: Office of the Secretary, Federal Trade Commis­ sion, 6th Street and Pennsylvania Ave., NW., Washington, D.C. 20580. SUPPLEMENTARY INFORMATION:

Having examined its rulemaking proce­ dures in light of the recent decisions by the Court of Appeals for the District of Columbia in Home Box Office, Inc. v. FCC, D.C. Cir. No. 75-1280 (March 25, FEDERAL REGISTER, VOL. 42, NO. 170— THURSDAY, SEPTEMBER 1, 1977

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43974 RULES AND REGULATIONS 1977; special concurring opinion by Mac­ Kinnon, J., May 20, 1977) and Action for Children's Television v. FCC, No. 74- 2006 (D.C. Cir. July 1, 1977), the Com­ mission has determined, as an exercise of discretion, to add a new section, § 1.18 (c), to its Rules of Practice. This new section will require that communications relating to a rulemaking proceeding be made only during the regular course of the proceeding, thus ensuring that they become part of the rulemaking record and providing an opportunity for com­ ment on such communications. Section 1.18(c) provides that, after a rulemaking proceeding has commenced, all com­ munications concerning the merits of that proceeding from persons not em­ ployed by the Commission to Commis­ sioners, or members of their -personal staffs, are prohibited. If a prohibited communication does occur it will be placed on the Commission’s public record but will not be considered by the Commission when it reviews the record of the proceeding. Requests for information as to the status of a rulemaking proceeding are not sub­ ject to these restrictions. Section 1.18 (b) is amended to reflect the Commis­ sion’s current practice of making the en­ tire rulemaking record publicly avail­ able. The titles to § 1.18 and § 1.18(a) are also being amended.

While this rule is effective September 1, 1977, the Commission invites com­ ments on it on or before October 3, 1977. Comments should be addressed to the Office of the Secretary. The Commission will review all comments received and take whatever action, if any, it deems ap­ propriate.

In consideration of the foregoing, 16 CFR Chapter 1 is amended as follows: By amending § 1.18(b) and adding § 1.18(c) to read as follows: § 1.18 Rulemaking Record.

(a) Definition.

* * * * * (b) Public availability. The rulemak­ ing record shall be publicly available ex­ cept when the presiding officer, for good cause shown, determines that it is in the public interest to allow any submission to be received in camera subject to the provisions of § 4.11 of this chapter. (c) Communications to Commission­ ers and their attorney advisors. Except as provided by the Commission, pursuant to § 1.14(a) of the Rules of Practice, af­ ter commencement of a trade regulation rule proceeding, no person not employed by the Commission shall communicate, orally or in writing, with any Commis­ sioner or any member of a Commission­ er’s personal staff, with respect to the merits of that proceeding. If a prohibited communication does occur, the commu­ nication will be placed on the' public record on receipt. In the case of an oral communication, the Commissioner or staff member shall place on the public record a memorandum setting forth the contents of such communication and the circumstances thereof. Such communi­ cations or memoranda will not be part of the rulemaking record.

By direction of the Commission, Com­ missioners Collier and Dole dissenting. J ames A. T obin, Acting Secretary.

D i s s e n t i n g S t a t e m e n t o f C o m m i s s i o n e r C o l l ie r t o C o m m i s s i o n D e c i s i o n t o A d o p t A m e n d m e n t t o § 1.18 o f t h e C o m m i s s i o n ’s R u l e s o f P r a c t ic e I dissent from this modification of the Commission’s rules, not because I believe that off-the-record communications with re­ spect to the merits of rulemaking proposals should be permitted, but because the Com­ mission has declined to provide an adequate opportunity for such communications to be made on-the-record.

In my opinion, our current rules are seri­ ously deficient in their failure to provide for oral presentations to the Commissioners by designated representatives in rulemaking proceedings. Section 1.14 of our Rules pro­ vides: "Where it believes that it should have further information or additional views of interested persons as to the form and con­ tent of the rule, it may withhold final action pending the receipt of such additional infor­ mation or views.” As implemented by the Commission to date, this Rule has not pro­ vided for the regular opportunity by interest­ ed persons to make oral presentations to the full Commission.

In contrast, we provide in adjudicative proceedings that: "Oral agruments will be held in all cases on appeal to the Commis­ sion, unless the Commission otherwise orders upon its own initiative or upon request of any party made at the time of filing his brief.” § 3.52(f). In practice, this Rule gen­ erally results in the Commission’s granting oral argument.

The same presumption favoring oral pres­ entations at the close of rulemaking pro­ ceedings should be created. These presenta­ tions, like post-record written comments, should, be based upon information already in the record. See § 1.13(h). The opportunity should be afforded to representatives of vari­ ous interests that were selected by the pre­ siding officer. See § 1.13(d) (5) (D). See also § 1.17.

I have no quarrel with controlling com­ munications to Commissioners during the course of rulemaking proceedings. The fail­ ure to do so can render our orderly proce­ dures for accumulating relevant informa­ tion and views a nullity if not a charade. But I object to an absolute ban on such com­ munications (in contrast, for example, to placing them on the public record), unless and until the Commission establishes a prop­ er forum for receipt of oral presentations: D i s s e n t i n g S t a t e m e n t o f C o m m i s s i o n e r D o l e I • agree that the Commission should tighten up its procedures for dealing with contacts between Commissioners and out­ side parties on the merits of pending rulemaking proceedings. Otherwise, the elabo­ rate procedures established for toe develop­ ment and analysis in public of a rulemaking record could be compromised. However, I disagree with toe solution, adopted by the majority. I believe that toe purpose of this rule jcould have been served in a less restrictive way, modeled along the lines of the draft recommendations recently Issued by the Administrative Conference of the United States, Select Committee on Ex Parte Communications. I would have pre­ ferred a rule requiring that, after commence­ ment of a trade regulation rulemaking proceeding, all written communications from any person not employed by the Commis­ sion received by any Commissioner and ad­ dressed to the merits of the proposed rule be placed on the public record. In addition, all oral communications of substantive signifi­ cance from any person not employed by toe Commission addressed to the merits of toe proposed rule and made privately to any Commissioner would be required to be sum­ marized and placed on the public record. It has been my policy in the past, when meet­ ing with any person outside the agency con­ cerning agency business, to have an FTC staff member present, and I would have con­ tinued this policy.

The solution I wotild have preferred is con­ sistent with the current emphasis on open government conducive to developing all rele­ vant information and the accessibility of government decision-makers to any member of the public. It is also consistent with the traditionally flexible, legislative nature of in­ formal rulemaking. At the same time, this solution would have ensured that toe pub­ lic and reviewing counts were provided with a record of all considerations presented to the agency.

[FR Doc.77-25666 Filed 8-31-77;8:45 am]