Alexis de Tocqueville allegorized Parliament as a man navigating a sailing boat in the middle of the ocean: he can steer the ship, but cannot influence its structure, nor can he create wind or stop the currents. We can expand on this allegory: the combination of sea currents and the ambition of the captain have led the boat into increasingly treacherous waters. In order to stay afloat, the captain and his sailors (the Executive) have to appeal to experts. These are often actors outside the traditional Trias Politica, or autonomous public, private, and hybrid actors. The US Supreme Court put it as follows in the Mistretta case: ‘In our increasingly complex society, replete with ever-changing and more technical problems, Congress simply cannot do its job absent an ability to delegate power under broad general directives.’ Outsourcing is thus a strategy to deal with governmental responsibilities.
This outsourcing even affects rulemaking powers. Rulemaking powers are powers to enact, accept, or establish abstract, general, and legally binding norms that have the purpose and effect of altering legal rights, duties, and relations between persons. The book Outsourcing Rulemaking Powers distinguishes three techniques by which these powers can be outsourced.
- Delegation: The delegator (i.e., the Legislature or Executive) mandates autonomous public, private, or hybrid actors to exercise well-defined rulemaking competences in its place.
- Referral: The Legislature or the Executive refers in its own rulemaking to an external document that was produced by an autonomous public, private or hybrid actor. ‘Static referral’ implies that the rule is connected to the external document as it is at the time of the referral. ‘Dynamic referral’ means that the rule is linked to the external document as it is and as it will be in the future.
- Reception: The Legislature or the Executive receives, rubberstamps – and potentially declares generally binding – the rulemaking initiatives of professional organizations.
Through a comparative doctrinal analysis, two research hypotheses are posed in the light of various constitutional systems, with examples ranging from Brazil, Canada, China and South Africa. However, the book focuses on five specific countries: the United Kingdom, the United States, Belgium, France and Germany. It investigates the following overarching issue: How may rulemaking powers be outsourced? This overarching question can be broken down into two more precise research hypotheses.
- One research hypothesis concerns the limits to a Legislature or Executive outsourcing rulemaking power. This part is of a more general comparative nature and is further developed in a twin blogpost available by clicking here
- Another research hypothesis concerns the standards and guarantees that rules made by actors outside the three traditional branches must heed in order to comply with the principles of good rulemaking similarly to traditional rulemakers. Some main insights of the book on this matter will be developed in this blog post. A hot topic of comparative and European administrative law is the legal integration of technical standards (see here and here for instance), which is why this post will focus primarily on the referral technique.
2. Comparative national outsourcing safeguards
The hypothesis discussed is as follows: Outsourced rules – like all rules – need to comply with some qualitative guarantees. In order to test this hypothesis, I first defined five principles of good rulemaking that appear particularly problematic when autonomous public or private actors create rules: transparency, a hierarchy of rules, judicial review, representativeness, and efficiency/effectiveness. These five principles were distilled from the literature and case law of the countries researched and ultimately inspired by the five principles of good governance (openness, coherence, accountability, participation, and effectiveness, respectively) that the EU Commission drafted in its White Paper on European Governance of 2001. The Commission developed these principles in reply to the criticism that the EU was insufficiently legitimized due to its lack of political accountability. This criticism greatly resembles the challenges that autonomous public or private actors face on a national level, and thus provides fertile ground for testing the aforementioned research hypothesis.
Transparency, as a principle of good rulemaking, is protected in Belgium and Germany by constitutional provisions (articles 190 of the Belgian Constitution and article 82 of the Basic Law, respectively) and in France, the UK, and the US by a judicially evolved constitutional principle. It consists of both accessibility and intelligibility.
With regard to accessibility, the biggest issue is the absence of a framework statute that regulates the publication of outsourced rules for any of the three outsourcing techniques in the researched countries. With regard to intelligibility, outsourced rules are often criticized for being insufficiently clear and understandable. The research proposes four possible ways to further improve the intelligibility of outsourced rules: increased consultation; the publication of internal debates; the publication of the motivation for the rules; and enhanced attention to comprehensible language.
B. Hierarchy of rules
A hierarchy of rules, as a second principle of good rulemaking, is particularly essential to the Belgian, French, German, and US legal systems. This is not the case for the UK legal system, where a hierarchy of rules merely determines the dichotomy between primary and secondary rules.
In order to establish the position of outsourced rules within the researched countries’ respective hierarchies of rules, the monograph first attempted to position these rules within existing categories of rules, based on national statutes or scholarly theories. Such a partial framework currently exists mainly for rules made using the reception technique. With regard to the referral technique, the Dutch High Council did not attribute a hierarchical value to referred-to-standards. This contrasts with the German position, which does seem to accept that a standard to which a state rule refers will receive the hierarchical status of that rule. Belgium, France, the US, and the UK are yet to make definitive decisions on this matter. The book defends the approach in which the status of the referring rule is also given to the referred-to-standard, since it is legally clear and most candid towards the constituency that becomes bound by that referred-to-standard.
C. Judicial review
Having access to judicial review, that is, to a court in order to dispute a rule, is arguably one of the most important principles of good rulemaking. In the researched countries, courts can review rules made by autonomous public or private actors subject to a delegation.
In terms of the referral technique, this research has established that the hierarchical and legal status of referred-to-standards within the researched countries determines whether the standard is subject to judicial review. This is the case if the referring rule and the referred-to-standard are at the same hierarchical level. Regardless of whether national courts can directly review the referred-to-standard, I examined whether national courts should have or do have the powers to influence the type of referral that the referring rule uses. In previous case law, the German Constitutional Court reinterpreted a dynamic referral as a static referral in order to comply with constitutional limits and safeguards. This judicial interpretation technique was also adopted in the Netherlands. There are also elements in parallel branches of at least Belgian and UK law, which would warrant the judicial amendment of a dynamic to a static referral.
Finally, the research could not establish a principled heightened or lowered standard of review for outsourced rules. In general, however, outsourced rules should be technical or accessory. The more technical they are, the lower the standard of review becomes, because judges do not have the necessary expertise or discretionary power to substitute the autonomous public or private actor’s decision with their own.
Representativeness is a fourth principle of good rulemaking. Politically accountable actors are representative because they have either been directly elected by the people or because they can be held politically accountable by those who have been elected by the people. National constitutions and constitutional principles will guarantee that this acquired representativeness remains, by, for example, ensuring the independence of politically accountable actors or—usually in the case of the Executive—imposing requirements of consultation. These two pillars that uphold representativeness, namely independence and consultation, must also be present when autonomous public or private actors create rules.
At first sight, representativeness does not appear to be the primary concern within the referral technique; to the detriment of expertise. However, various commentators have lamented the lack of representativeness within standard-setting bodies, certainly when the Legislature and the Executive refer to their standards. It is crucial that these standard-setting bodies safeguard their independence from industry interests and simultaneously involve non-expert stakeholders in the development of their standards in order for them to become a legitimate legal basis to which to refer.
Efficiency/effectiveness, as a fifth and final principle of good rulemaking, is arguably the most difficult to enforce legally. Theoretically, effectiveness means that the goal pursued by the rule is attained; efficiency means that, taking into account the available tools, the goal is pursued in the most desirable way.
In order to further improve the efficiency of autonomous public or private actors, and the effectiveness of their rules, the monograph recommends deferentially appointing and evaluating the staff of autonomous public or private actors and reviewing their annual reports. Furthermore, it argues against a recent tendency in the politics of at least some of the researched countries to reject regulatory impact assessments (RIAs).
The essential finding of the comparative research on the research hypothesis with respect to the researched countries is that there are indeed comparative national outsourcing safeguards that match the safeguards for rules made by the Legislature or the Executive. However, an overarching framework rule or statute to regulate the transparency, hierarchy, judicial review, representativeness, and effectiveness of outsourced rules is mostly lacking. Hopefully, the overview, as set out in this research, will help to create a common ‘law of rules’, which will articulate the safeguards of the rule of law, democracy, and the separation of powers.
The thorough development of both research hypotheses and a number of other conclusions, recommendations and insights can be found in the book, which offers a unique bridge between traditional comparative constitutional law, on the one hand, and transnational private regulation and global administrative law, on the other.
Posted by Dr Cedric Jenart (assistant professor of constitutional law – University of Antwerp)
Suggested citation: C Jenart, “Outsourcing Rulemaking Powers”, REALaw.blog available at https://wp.me/pcQ0x2-q0.