Administrative State
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TheFederal Trade Commission Act (FTCA) is a federal law passed in 1914 establishing theFederal Trade Commission (FTC). It was signed into law by President Woodrow Wilson on September 26, 1914. The five-member body was created to protect consumers by preventing what it deemed unfair methods of competition between businesses and deceptive business practices. The FTC investigates “price-fixing agreements and other unfair methods of competition;” prohibits “mergers and price discriminations that threatened to lessen competition;” investigates “deceptive practices such as false advertising;” and regulates “packaging and labeling of consumer goods to prevent deception,” according to the National Archives and Records Administration. It replaced the Bureau of Corporations.^[1][2]

Background

During the Progressive Era, there was an effort to regulate monopolies through antitrust laws. In 1890, Congress passed theSherman Act, which forbade “[e]very contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations,” and made it illegal “to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the tradeor commerce among the several States, or with foreign nations.” Questions about the Sherman Act that were raised in the 1911 U.S. Supreme Court casesStandard Oil Co. v United States andUnited States v. American Tobacco Co. made antitrust laws central to the 1912 election. This issue led in part to PresidentWoodrow Wilson's election.^[3]

In 1913, during his first year in office, Wilson created the Bureau of Corporations, which was tasked with investigating monopolistic business practices. Then, in 1914, with the backing of Wilson, the Federal Trade Commission Act created the Federal Trade Commission. The Senate approved the FTCA on September 8, 1914, by a vote of 43-5. The House approved the bill by voice vote on September 10, 1914. The commission was launched in March 1915. The FTC replaced the Bureau of Corporations, which was created under President Theodore Roosevelt, and expanded its authority.^[4]

Provisions

The FTCA created the Federal Trade Commission. The act gave the commission the authority to “(a) prevent unfair methods of competition and unfair or deceptive acts or practices in or affecting commerce; (b) seek monetary redress and other relief for conduct injurious to consumers; (c) prescribe rules defining with specificity acts or practices that are unfair or deceptive, and establishing requirements designed to prevent such acts or practices; (d) gather and compile information and conduct investigations relating to the organization, business, practices, and management of entities engaged in commerce; and (e) make reports and legislative recommendations to Congress and the public.”^[5]

Commission members

The five commissioners of the FTC are nominated by the president and must be confirmed by the Senate. Commissioners are appointed for seven-year terms. No more than three of the FTC members can be from the same political party.^[1]

Unfair Practices

The FTCA bans unfair business practices. According to Al Krulick ofDebt.org, “the FTC considers a set of criteria established in the Supreme Court’s 1972 Sperry and Hutchinson ruling” to determine whether a practice is unfair. The criteria include unjustified consumer injury, violation of public policy, and deceptive practices.Cite error: Invalid<ref> tag; invalid names, e.g. too many

FTC Bureaus

The FTC includes the Bureau of Consumer Protection, the Bureau of Competition, and the Bureau of Economics.Cite error: Invalid<ref> tag; invalid names, e.g. too many

Enforcement

According to Krulick, if the FTC finds that a business violated the provisions of the FTCA, the FTC can “seek compliance through a consent order, or file an administrative complaint. Litigation is also possible. Administrative complaints are heard in front of an independent administrative law judge, with the FTC serving as prosecutor. The FTC can also bring cases to the federal courts, which can impose fines, appoint receivers and monitors, and freeze business assets when deemed necessary. The FTC also promulgates and enforces trade rules, which regulate business practices.”Cite error: Invalid<ref> tag; invalid names, e.g. too many

Amending statutes

Below is a partial list of subsequent laws that amended provisions of the Federal Trade Commission Act:^[6]

• TheRobinson-Patman Act (1936) outlawedprice discrimination, defined byInvestopedia as "a pricing strategy that charges customers different prices for the same product or service." This act added price discrimination as an anticompetitive practice regulated by the FTC.^[7][8]

• TheWheeler-Lea Act (1938) expanded the FTC's regulatory authority to include unfair and deceptive practices targeting consumers, such as false advertising. Prior to this act, the FTC was limited to regulating anticompetitive practices among businesses.^[9]

• TheMagnuson-Moss Warranty—Federal Trade Commission Improvement Act (1975) authorized the FTC to regulate written warranties on consumer products.^[10]

• TheHart-Scott-Rodino Act (1976) requires the parties to a large merger or acquisition to provide notification and information to the FTC before the transaction is completed.^[11]

See also

• Administrative state
• Clayton Antitrust Act
• Sherman Antitrust Act

External links

• Federal Trade Commission Act (Chapter 311, 38 Stat. 717)
• Search Google News for this topic

Footnotes

v • e The Administrative State Main The Administrative State Project main page •Administrative State Project Index •Glossary of administrative state terms •Quotes about the administrative state •Administrative state •Rulemaking •Deference •Adjudication •Nondelegation doctrine •Ballotpedia's administrative state legislation tracker Pillars Agency control •Executive control •Judicial control •Legislative control •Public control Reporting Changes to the Federal Register •Completed OIRA review of federal administrative agency rules •Federal agency rules repealed under the Congressional Review Act •Historical additions to the Federal Register, 1936-2016 Laws Administrative Procedure Act •Antiquities Act •Civil Service Reform Act •Clayton Antitrust Act •Communications Act of 1934 •Congressional Review Act •Electronic Freedom of Information Act •Federal Food, Drug, and Cosmetic Act of 1938 •Federal Housekeeping Statute •Federal Reserve Act •Federal Trade Commission Act of 1914 •Freedom of Information Act •Government in the Sunshine Act •Independent Offices Appropriations Act of 1952 •Information Quality Act •Interstate Commerce Act •National Labor Relations Act •Paperwork Reduction Act •Pendleton Act •Privacy Act of 1974 •Regulatory Flexibility Act •REINS Act •REINS Act (Wisconsin) •Securities Act of 1933 •Securities Exchange Act of 1934 •Sherman Antitrust Act •Small Business Regulatory Enforcement Fairness Act •Truth in Regulating Act •Unfunded Mandates Reform Act Cases Abbott Laboratories v. Gardner •A.L.A. Schechter Poultry Corp. v. United States •Association of Data Processing Service Organizations v. Camp •Auer v. Robbins •Chevron v. Natural Resources Defense Council •Citizens to Preserve Overton Park v. Volpe •Federal Trade Commission (FTC) v. Standard Oil Company of California •Field v. Clark •Food and Drug Administration v. Brown and Williamson Tobacco Corporation •Humphrey's Executor v. United States •Immigration and Naturalization Service (INS) v. Chadha •J.W. Hampton Jr. & Company v. United States •Lucia v. SEC •Marshall v. Barlow's •Massachusetts v. Environmental Protection Agency •Mistretta v. United States •National Federation of Independent Business (NFIB) v. Sebelius •National Labor Relations Board v. Noel Canning Company •National Labor Relations Board v. Sears, Roebuck & Co. •Panama Refining Co. v. Ryan •Securities and Exchange Commission v. Chenery Corporation •Skidmore v. Swift & Co. •United States v. Lopez •United States v. Western Pacific Railroad Co. •Universal Camera Corporation v. National Labor Relations Board •Vermont Yankee Nuclear Power Corp. v. Natural Resources Defense Council •Wayman v. Southard •Weyerhaeuser Company v. United States Fish and Wildlife Service •Whitman v. American Trucking Associations •Wickard v. Filburn •Wiener v. United States Terms Adjudication (administrative state) •Administrative judge •Administrative law •Administrative law judge •Administrative state •Arbitrary-or-capricious test •Auer deference •Barrier to entry •Bootleggers and Baptists •Chevron deference (doctrine) •Civil servant •Civil service •Code of Federal Regulations •Codify (administrative state) •Comment period •Compliance costs •Congressional Record •Coordination (administrative state) •Deference (administrative state) •Direct and indirect costs (administrative state) •Enabling statute •Ex parte communication (administrative state) •Executive agency •Federal law •Federal Register •Federalism •Final rule •Formal rulemaking •Formalism (law) •Functionalism (law) •Guidance (administrative state) •Hybrid rulemaking •Incorporation by reference •Independent federal agency •Informal rulemaking •Joint resolution of disapproval (administrative state) •Major rule •Negotiated rulemaking •Nondelegation doctrine •OIRA prompt letter •Organic statute •Pragmatism (law) •Precautionary principle •Promulgate •Proposed rule •Publication rulemaking •Regulatory budget •Regulatory capture •Regulatory dark matter •Regulatory impact analysis •Regulatory policy officer •Regulatory reform officer •Regulatory review •Rent seeking •Retrospective regulatory review •Risk assessment (administrative state) •Rulemaking •Separation of powers •Significant regulatory action •Skidmore deference •Statutory authority •Substantive law and procedural law •Sue and settle •Sunset provision •Unified Agenda of Federal Regulatory and Deregulatory Actions •United States Code •United States Statutes at Large Bibliography "Administrative Law - The 20th Century Bequeaths an 'Illegitimate Exotic' in Full and Terrifying Flower" by Stephen P. Dresch (2000) "Confronting the Administrative Threat" by Philip Hamburger and Tony Mills (2017) "Constitutionalism after the New Deal" by Cass R. Sunstein (1987) Federalist No. 23 by Alexander Hamilton (1787) "From Administrative State to Constitutional Government" by Joseph Postell (2012) "Interring the Nondelegation Doctrine" by Eric A. Posner and Adrian Vermeule (2002) "Rulemaking as Legislating" by Kathryn Watts (2015) "The Checks & Balances of the Regulatory State" by Paul R. Verkuil (2016) "The Myth of the Nondelegation Doctrine" by Keith E. Whittington and Jason Iuliano (2017) "The Progressive Origins of the Administrative State: Wilson, Goodnow, and Landis" by Ronald J. Pestritto (2007) "The Rise and Rise of the Administrative State" by Gary Lawson (1994) "The Study of Administration" by Woodrow Wilson (1887) "The Threat to Liberty" by Steven F. Hayward (2017) "Why the Modern Administrative State Is Inconsistent with the Rule of Law" by Richard A. Epstein (2008) Agencies Administrative Conference of the United States •United States Civil Service Commission •U.S. Government Accountability Office •U.S. Office of Information and Regulatory Affairs •U.S. Office of Management and Budget