On February 19, 2025, President Donald Trump issued the executive order “Ensuring Lawful Governance and Implementing the President’s ‘Department of Government Efficiency’ Deregulatory Initiative” (the 2025 EO). The 2025 EO, which directs agencies’ rulemaking and enforcement activities, is likely to lead to a host of agency actions to rescind or modify regulations already on the books.
Those actions could spur litigation over those rescissions or modifications; regulated parties should be prepared to participate in that litigation to defend their interests in changes to agency rules. And because the 2025 EO requires agencies to identify regulations that might be vulnerable to challenge, private parties may be able to use agencies’ statements as road maps for challenging rules under the Administrative Procedure Act (APA), to the extent the agencies do not rescind those rules.
The 2025 EO establishes requirements for rulemaking and enforcement and requires agencies to:
- Begin a process to identify and rescind regulations that are inconsistent with the Trump administration’s policies and that raise legal questions.
- Constrain their enforcement authorities.
To implement these goals, the 2025 EO requires agencies to coordinate with the Department of Government Efficiency (DOGE) and the Office of Management and Budget (OMB) to provide to OMB, within 60 days, a list of regulations that are:
- Unconstitutional or raise “serious constitutional difficulties”;
- Based on unlawful delegations of legislative power;
- Not based on the best reading of the underlying statutory authority or prohibition;
- Related to matters of social, political or economic significance, and are not based on clear statutory authority;
- Costly to private parties and not outweighed by resulting public benefits;
- Impediments to certain administrative priorities (innovation, energy production and reducing inflation, for instance); or
- Burdensome to small businesses and entrepreneurship.
The 2025 EO also directs OMB — through its Office of Information and Regulatory Affairs (OIRA) — to develop a “Unified Regulatory Agenda” that “seeks to rescind or modify” the regulations agencies identify as meeting those criteria.
To constrain agency enforcement discretion during this process, the 2025 EO directs agencies to deprioritize any enforcement proceedings that are based on regulations that adopt “anything other than the best reading of the statute,” or regulations that exceed the constitutional powers of the federal government.
The 2025 EO goes beyond an existing mechanism — the Congressional Review Act (CRA) — to rescind regulations. The CRA (see our previous client alert) allows Congress to repeal regulations issued within the previous 60 legislative days (those in which either the House or Senate is working) of the issuance of a final regulation or, if a new Congress has convened in that span, within the first 60 legislative days of a new Congress.
The 2025 EO supplements the CRA by offering a different avenue to rescind regulations — one that doesn’t require any action by Congress. And it has broader impact than the CRA because it is not time-limited (it direct agencies to rescind regulations issued at any time), and it asks agencies to immediately stop enforcing regulations that are found to exceed the agency’s statutory authority.
The 2025 EO in Context: Prior 2017 Order and Other Recent Executive Actions
The 2025 EO is part of a broader sweep of Trump administration executive orders. These executive actions dovetail with recent U.S. Supreme Court decisions that impose more stringent requirements on agency rulemaking while also expanding procedural rules to allow more challenges to rulemaking.
President Trump issued a similar order in February 2017, Executive Order 13777, “Enforcing the Regulatory Reform Agenda” (the 2017 EO). The 2017 EO directed agencies to undertake a process to “repeal, replace[], or modif[y]” certain regulations. The 2017 EO primarily took aim at outdated regulations, regulations that impeded job growth or had other negative economic consequences, and regulations that were inconsistent with the administration’s stated policy goals.
In the first Trump administration, agencies went through the exercise of publicly collecting regulations to be considered for reform under the 2017 EO (See EPA’s efforts, Interior’s efforts) or seeking public comments on regulations that should be considered for such reform (see FDA’s Federal Register notice). The 2025 EO takes a more forceful approach, requiring agencies to immediately exercise enforcement discretion with respect to identified regulations. It is unlikely that agencies will be able to take the same approach they did in 2017 this time.
The 2025 EO also works in concert with other regulation-related EOs issued by the second Trump administration, including the recent executive orders “Ensuring Accountability for All Agencies” (directing all agencies, including independent agencies, to submit proposed rules to OIRA before publication) and “Unleashing Prosperity Through Deregulation” (directing agencies to repeal 10 existing regulations for each new proposed regulation).
Together, these EOs will function to stymie new regulatory actions and prevent enforcement of regulations that may be viewed as contrary to the administration’s policies, the agencies’ statutory authority or the Constitution.
The 2025 EO and Recent and Future Supreme Court Decisions
The categories of regulations identified by the 2025 EO map onto Supreme Court doctrine governing judicial review of agency action. Understanding that doctrine is important to understanding both the regulations that agencies must identify under the 2025 EO and the arguments that agencies might make in rescinding or modifying those regulations.
First, the 2025 EO channels the Supreme Court’s ruling in Loper Bright Enterprises v. Raimondo, 603 U.S. 369, 412 (2024) (see our previous client alert), which overruled Chevron deference and required courts to “exercise their independent judgment in deciding whether an agency has acted within its statutory authority.”
Before Loper Bright overruled it, Chevron required courts to defer to agencies’ reasonable interpretations of ambiguous statutory language. Now, courts must rely on ordinary tools of statutory construction to determine the best reading of a statute, without giving an agency’s view any weight beyond its persuasive value.
The 2025 EO, in turn, asks agencies to identify “regulations that are based on anything other than the best reading of the underlying statutory authority or prohibition.” In other words, the EO instructs agencies to identify when they believe they have exceeded their statutory authority.
Second, by requiring agencies to identify regulations “[b]ased on unlawful delegations of legislative power,” the 2025 EO invokes the nondelegation doctrine, a doctrine that has long been largely defunct but that is squarely before the Supreme Court this term. That doctrine provides that the Constitution commits to Congress alone the power to make laws, so Congress cannot give that authority to others, like agencies or private parties.
The doctrine has been dormant since 1935, when the Supreme Court struck down two New Deal measures before switching course and upholding others. As currently articulated, the nondelegation doctrine prohibits Congress from delegating power to agencies without some “intelligible principle” to constrain the agency’s delegation. See A.L.A. Schechter Poultry Corp. v. United States, 295 U.S. 495 (1935).
But the Court has signaled in recent terms that some justices are interested in reinvigorating the 1935-era doctrine, which may require more than just an intelligible principle. See, e.g., Loper Bright, 603 U.S. at 414 (Thomas, J., concurring); Gundy v. United States, 588 U.S. 128, 155 (2019) (Gorsuch, J., dissenting).
This term, the justices will confront the issue at oral argument in March 2025 in two consolidated cases addressing whether a statute delegating authority to the Federal Communications Commission (FCC) violates the nondelegation doctrine. See Federal Communications Commission v. Consumers’ Research, No. 24-354 (OT 2024); Schools, Health & Libraries Broadband Coalition v. Consumers’ Research, No. 24-422 (OT 2024).
The Supreme Court’s decision in those cases may ultimately affect the administration’s approach; in the meantime, the 2025 EO appears to ask agencies to identify, at the very least, regulations promulgated under statutes that provide no or few constraints on agency discretion.
Third, the 2025 EO singles out regulations that govern matters of economic, social or political significance. That requirements tracks the Supreme Court’s resurgent major questions doctrine, which requires “clear congressional authorization” for agency action purporting to regulate a matter of major political or economic significance.
Applying that doctrine in recent terms, the Court has struck down the Biden administration’s student loan forgiveness program, Biden v. Nebraska, 143 S. Ct. 2355, 2375 (2023); the Environmental Protection Agency’s (EPA’s) Affordable Clean Energy Rule, West Virginia v. Environmental Protection Agency, 597 U.S. 697 (2022); the Occupational Safety and Health Administration’s (OSHA’s) vaccine mandate, National Federation of Independent Business v. Department of Labor, Occupational Safety & Health Administration, 595 U.S. 109, 113 (2022); and the Centers for Disease Control and Prevention’s (CDC’s) eviction moratorium, Alabama Association of Realtors v. Department of Health & Human Services, 594 U.S. 758 (2021).
Most recently, the en banc Fifth Circuit applied the major questions doctrine to strike down the Securities and Exchange Commission’s (SEC’s) approval of NASDAQ diversity disclosure rules. Alliance for Fair Board Recruitment v. Securities and Exchange Commission, 125 F.4th 159, 165 (5th Cir. 2024) (en banc).
Picking up on that decision, the Trump administration issued its executive order “Ending Radical and Wasteful Government DEI Programs and Preferencing” directing agencies to terminate all diversity, equity and inclusion (DEI) programs among all federal agencies.
Fourth, the 2025 EO also picks up on the Supreme Court’s insistence that agencies consider costs and benefits when those factors are relevant under the law, as a matter of the agency’s discretion or because commenters put costs or benefits at issue. See generally, e.g., Ohio v. Environmental Protection Agency, 603 U.S. 279, 292-93 (2024); Michigan v. Environmental Protection Agency, 576 U.S. 743 (2015).
Motor Vehicle Manufacturers Association of the United States, Inc. v. State Farm Mutual Automobile Insurance Company, 463 U.S. 29, 43 (1983), and other decisions require an agency to consider “all relevant factors,” and Loper Bright cited Michigan v. EPA in reaffirming the more general proposition that agencies must engage in “reasoned decisionmaking.”
Thus, an agency’s failure to consider the burden of regulation will be vulnerable to challenge, and any regulations that suggest such failure must be included in the list of regulations required to be provided under the 2025 EO.
Future Litigation To Come From the 2025 EO
The review process mandated by the 2025 EO could lead to a number of developments, resulting in litigation that regulated parties will want to pay close attention to.
To start, agencies are likely to rescind or modify rules that they believe exceed their authority. Those actions are open to challenge, and regulated parties should be prepared to intervene to defend or oppose rescission or modification of rules that affect them. But even if an agency does not take action to rescind or modify the rules on the list it is required to develop, regulated parties may be able to take advantage of a generous statute of limitations to challenge those regulations.
First, rescinding or modifying a rule typically requires a new substantive rulemaking, meaning that an agency will need to issue a Notice of Proposed Rulemaking, collect public comment and then issue a final rulemaking. Failure to abide by those procedural requirements could open up the rescission or modification to challenge under the APA.
Second, agencies need to comply with the APA’s reasoned decisionmaking requirement when they rescind or modify rules: “[A]gencies are free to change their existing policies as long as they provide a reasoned explanation for the change.” Encino Motorcars, LLC v. Navarro, 579 U.S. 211, 221 (2016).
Under the Supreme Court’s decision in State Farm, an agency must adequately explain why it is rescinding a regulation, or the rescission may itself be arbitrary and capricious. State Farm itself concerned an agency’s rescission of a prior regulation, holding that a reviewing court should invalidate agency action if the agency fails to adequately explain the basis of its decision or to consider important aspects of the problem, or relies on factors that Congress did not intend it to consider.
Courts are likely to consider a lack of statutory authority to be a sufficient reason for rescission, and as long as the agency adequately explains that basis for rescinding the rule, the rulemaking will likely survive judicial review.
Regulated parties should also pay close to attention to the regulations agencies are required to submit to OIRA. Simply by identifying regulations that they believe exceed their statutory authority, agencies will create a road map for legal challenges for parties aggrieved by those regulations or by regulations with similar language that may suffer from the same infirmities.
The Supreme Court’s decision in Corner Post, Inc. v. Board of Governors, 603 U.S. 799 (2024) has extended the time to challenge many existing regulations by running the statute of limitations from the time of injury rather than issuance of the regulation (as we discuss in this client alert). And aggrieved parties may also be able to use an agency’s identification of unauthorized regulations as a reason to petition the agency to rescind the regulation, and, if necessary, to pursue judicial review of any denial of the rescission request.
Regulatory Uncertainty in the Interim
While agencies are undergoing this review process, regulated parties must be prepared for uncertainty in terms of agencies’ decisions to rescind, modify or enforce rules already on the books.
The end of the Biden administration brought a flurry of new regulations, including:
- The EPA’s limiting tailpipe emissions, mandating limits on carbon dioxide emissions from power plants and setting limits for levels of forever chemicals in drinking water.
- The Federal Trade Commission’s (FTC’s) banning noncompete agreements, fake reviews and requiring more transparency around negative option plans and recurring subscriptions (also known as “click-to-cancel”).
- The Department of Labor’s (DOL’s) expanding eligibility for overtime pay.
- The Food and Drug Administration’s (FDA’s) issuing final rules on using a “healthy” claim on food packaging, quality management system regulation for medical devices and laboratory-developed tests (LDT).
There were also hundreds of rules anticipated in 2025, but the Unified Agenda has been withdrawn, calling into question whether agencies will issue anticipated regulations this year.
Companies that have been preparing to comply with new regulatory requirements issued by the Biden administration now face an uncertain path forward, especially if compliance is costly or requires a new approach. For example, FDA’s LDT final rule created a broad-sweeping framework for regulation of a class of products that had not previously required FDA premarket review.
LDT manufacturers have been preparing to submit applications to FDA to comply with the final rule, but they may no longer have to. Of course, regulated parties that are subject to enforcement of controversial rules likely to be “deprioritized” by the 2025 EO must continue to abide by those requirements, but parties may expect less enforcement of rules that are inconsistent with the best reading of the statute or that may be viewed as violating the Constitution.
We anticipate that agencies will issue a regulatory inventory and enforcement discretion plan within the EO’s 60-day time frame that adheres to the administration’s stated agenda. We will track the publication of any guidance issued by OMB to assess how the office’s response to the agencies’ recommendations will impact regulated industries.
See the Executive Briefing publication
This memorandum is provided by Skadden, Arps, Slate, Meagher & Flom LLP and its affiliates for educational and informational purposes only and is not intended and should not be construed as legal advice. This memorandum is considered advertising under applicable state laws.