Operating within the United States requires a deep understanding of federal administrative law, specifically the Administrative Procedure Act (APA). The APA governs how federal agencies propose and establish regulations.
The Federal Rulemaking Process
Federal agencies do not have unchecked power to create rules. They must follow a strict, transparent process:
- Advanced Notice of Proposed Rulemaking (ANPRM): Optional step where agencies gather early feedback on a topic.
- Notice of Proposed Rulemaking (NPRM): The agency publishes the draft text of the rule in the Federal Register, explaining its rationale and legal authority.
- Public Comment Period: The agency must give the public, industry groups, and consumer advocates a set window (usually 30 to 90 days) to submit feedback.
- Final Rule Publication: The agency publishes the final rule, along with a statement addressing the material points raised during the public comment period.
If an agency fails to follow this process, or creates a rule that is “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law,” courts can invalidate the rule under the APA.
Key US Enforcement Agencies
+-----------------------------+
| US Federal Enforcement |
+-----------------------------+
|
+---------------------------+---------------------------+
| | |
+-----------------+ +-----------------+ +-----------------+
| Securities & | | Commodity Futures| | Financial Crimes|
| Exchange Comm. | | Trading Comm. | | Enforcement Net.|
| (SEC) | | (CFTC) | | (FinCEN) |
+-----------------+ +-----------------+ +-----------------+
- Securities and Exchange Commission (SEC): Regulates securities markets, protects investors, and oversees disclosures from publicly traded companies.
- Commodity Futures Trading Commision (CFTC): Oversees derivatives, futures, and swaps markets.
- Financial Crimes Enforcement Network (FinCEN): The US financial intelligence unit that enforces anti-money laundering (AML) laws and Bank Secrecy Act (BSA) mandates.
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