The orders span various sectors and aim to introduce sunset provisions into regulations and eliminate regulations deemed unlawful or anti-competitive.
On April 9, 2025, the Trump administration issued three new orders to reevaluate and roll back regulations across various sectors. These orders are a continued step toward implementing the administration’s objective of reducing regulatory burdens on agencies and the public (see our blog post on the Environmental Protection Agency’s plans to reconsider existing regulations).
Sunset Provisions Added to Regulations
The first executive order mandates that key agencies incorporate a sunset provision into their regulations governing energy production, which will provide for the future expiration of each of these regulations unless extended by the agency, to the extent permitted by law. As stated in the order, the sunset provisions will compel the agencies “to reexamine their regulations periodically to ensure that those rules serve the public good.” The agencies affected by this order include the Environmental Protection Agency (EPA), the Department of Energy (DOE), various bureaus within the Department of the Interior, and the Federal Energy Regulatory Commission (FERC), among others.
Under the order, these agencies are required to issue a “sunset rule” by September 30, 2025, that inserts a “Conditional Sunset Date” of one year after the effective date of the sunset rule into certain existing regulations, promulgated under certain statutes, including the Natural Gas Act of 1938, the Federal Power Act of 1935, and the Endangered Species Act of 1973, as listed in the order. Any new regulations must include a Conditional Sunset Date no more than five years in the future. The Conditional Sunset Date is a “date the regulation will cease to be effective and be removed from the Code of Federal Regulations, if the agency does not extend the Sunset Date” per the extension process also articulated in the order.
A covered agency, at its discretion, may extend the Conditional Sunset Date after following a process articulated in the order for a period of no more than five years in the future:
- Public Opportunity for Comment: The agency must offer the public an opportunity to comment on the costs and benefits of each regulation, either through a request for information or a similar process.
- Evaluation of Comments: After providing the opportunity for public comment, the agency must evaluate the feedback received to determine whether an extension of the Conditional Sunset Date is warranted.
- Agency Finding: The agency must make a formal finding that an extension is warranted based on its evaluation of the public comments.
The order expressly excludes “regulatory permitting regimes authorized by statute” from this requirement. Agencies’ interpretation of the breadth of this exception remains to be seen. Although the full impact of this order is speculative at this time, covered agencies will likely be required to dedicate significant resources as they seek to implement the order now and into the future through regular assessment of the relevance and impact of their regulations.
Should any regulations cease to be effective and be removed from the Code of Federal Regulations after the applicable Conditional Sunset Date passes, parties would still be responsible for complying with underlying statutes. This could present implementation challenges, particularly if covered regulations expand on the enabling statutes and have been relied on by industry and/or customers. To the extent a covered statute includes a citizen suit provision, such provision will remain intact despite regulatory rescissions, which could raise the prospect of citizen enforcement.
Potentially impacted parties have an opportunity between now and the September 2025 “sunset rule” deadline to engage with the agencies and provide input on the process.
Repeal of Regulations Deemed Unlawful
A second directive, a presidential memorandum, focuses on the repeal of regulations deemed unlawful pursuant to the process outlined in the president’s February 19, 2025, executive order (see our blog post for a summary of that order). The prior order directs the heads of all executive departments and agencies to identify certain categories of unlawful and potentially unlawful regulations. The new memorandum identifies a series of recent Supreme Court decisions addressing constitutional limitations on agency power and directs agencies to prioritize the repeal of regulations that either exceed the agency’s statutory authority or conflict with the identified Supreme Court rulings. Several of these decisions include:
- Loper Bright Enterprises v. Raimondo, 603 U.S. 369 (2024), in which the Court overruled the Chevron doctrine and held that under the Administrative Procedure Act (APA), courts must exercise their independent judgment when interpreting federal statutes implicating federal agencies and deciding whether an agency has acted within its statutory authority (see our Client Alert on the decision).
- Sackett v. EPA, 598 U.S. 651 (2023), in which the Court held that the Clean Water Act (CWA) only extends to wetlands that have a “continuous surface connection” with “waters of the United States” (WOTUS) (see our blog post on the decision).
- West Virginia v. EPA, 597 U.S. 697 (2022), in which the Court held that EPA’s attempt to force an overall shift in power generation from high-emitting to lower-emitting sources exceeded EPA’s statutory authority because it implicated a “major question” requiring explicit congressional authorization, which the Clean Air Act did not provide (see our blog post on the decision).
Following a 60-day review period mandated by the administration’s February 19, 2025, executive order, the memorandum instructs agencies to prioritize repeal of regulations that exceed statutory authority or conflict with these and other Supreme Court decisions. The memorandum emphasizes that agencies should make use of the APA’s “good cause” exception to expedite the repeal process and avoid the requirement for notice-and-comment proceedings. Additionally, within 30 days after the review period, agencies must submit a one-page summary to the Office of Information and Regulatory Affairs for each regulation identified, but not repealed, explaining the rationale for retaining it.
Eliminating “Anti-Competitive Regulations”
Lastly, the third executive order aims to foster competition and innovation by modifying or eliminating certain “anti-competitive regulations.” The order directs agency heads, in consultation with the Chair of the Federal Trade Commission and the Attorney General, to review regulations that limit competition or market entry and recommend rescissions or modifications to the regulations when appropriate. The categories of regulations to be identified include those that:
- “create, or facilitate the creation of, de facto or de jure monopolies”;
- “create unnecessary barriers to entry for new market participants”; and
- “otherwise impose anti-competitive restraints or distortions on the operation of the free market.”
Following public input and further review, a consolidated list of suggested changes will be provided to the Office of Management and Budget to determine whether they should be included in its Unified Regulatory Agenda developed pursuant to the February 19, 2025, executive order.
The orders do not result in any immediate changes to or rescission of regulations. Implementing many of these actions will require agencies to engage in the notice-and-comment rulemaking process, make formal determinations, or conduct other proceedings. These processes are projected to play out over a period of months, potentially up to a year or more. Litigation commonly follows agency rulemakings and would be expected to follow implementing actions.
Latham & Watkins will continue to monitor all developments in this area.
