–José Ignacio Hernández G., Invited professor, Castilla-La Mancha University (Spain); Researcher, Coruña University (Spain)[1]
In memory of Eduardo García de Enterría, on the centennial of his birth
The modern Administrative State in the United States has sparked a debate about its constitutionality, particularly in terms of adhering to the original meaning of the Constitution. Some view it as a violation of the 1787 Constitution[2], while others believe that adherence to Administrative Law morality principles could reinforce its constitutional foundations.[3]
In 2022, the U.S. Supreme Court interpreted the constitutional foundations of the Administrative State regarding the delegation of authority by Congress. In National Federation of Independent Business v. Department of Labor[4], the Court adopted a restrictive approach, defining agencies as creatures of statute. The Court employed the major questions doctrine to conclude that a clear and specific delegation of authority by Congress is necessary in areas of vast economic and political significance. This same doctrine was used in West Virginia[5] to determine that vast environmental regulations must be based on a clear and specific delegation of authority by Congress.
In both cases, the major question doctrine was used to apply a restrictive interpretation of the scope of competencies that agencies can exert in areas of national relevance, leading the Court to conclude that agencies had exceeded their scope of authority based on a narrow interpretation of the Statutes.
From a Comparative Constitutional Law perspective, the major question doctrine shares similarities with the theory of legal reserve. This theory, rooted in Spain and Germany, was analyzed by the Spanish jurist Eduardo García de Enterría, particularly, regarding the Public Administration´s rulemaking power.
To explore the major question doctrine in the context of the constitutional foundations of the Administrative State further, this post will compare and contrast it with the legal reserve doctrine.
The major questions doctrine and agencies as creatures of the Statute
As applied in National Federation of Independent Business and West Virginia, the mayor question doctrine is based on two precedents.
In the FDA case, decided in 2000, the Supreme Court analyzed the scope of a delegation.[6] According to the Court, “where Congress has established regulatory authority over a significant aspect of an industry, we have been reluctant to find that Congress implicitly delegated additional authority to the agency to deal with the industry’s entire universe”. This is because “we expect Congress to speak clearly if it wishes to assign to an agency decisions of vast economic and political significance”.[7] In 2014, in Utility Air Regulatory Group, the Court applied the reasonableness test to affirm that an agency´s interpretation must be deemed unreasonable if it “bring about an enormous and transformative expansion” in the “regulatory authority without clear congressional authorization”.[8]
This conclusion was reached following Justice Breyer’s commentary on the margin of deference over questions of law, particularly important ones, that is, major questions of law.[9] As Cass Sunstein explained, the “major question doctrine” is a kind of Chevron[10] carve-out for “issues of great social and economic importance“,[11] but it can also prevent agencies from interpreting ambiguous statutes to assert broad regulatory powers.[12]
In 2022, the Supreme Court relied on the major question doctrine to reduce agencies´ scope of regulatory authority.
In National Federation of Independent Business, the Supreme Court states that “Administrative agencies are creatures of the Statute. They accordingly possess only the authority that Congress has provided”.[13] Agencies were defined from the narrower perspective of the Statute, highlighting its executive dimension. According to Justice Gorsuch concurring, not only must agencies invoke their statutory authority, but in addition, in areas of “vast economic and political significance”, the statutory authority must be clear.[14]
The major questions doctrine was further elaborated in West Virginia. Although agencies must always act subject to the Statute, regarding areas of “vast economic and political significance”, the judicial review must determine if there is a clear delegation by the Congress. Without a clear statement, the agencies cannot exert their regulatory powers. Therefore, the doctrine was applied to elevate the threshold of congressional delegation, requiring a clear and specific provision in “extraordinary cases”, to avoid “extravagant statutory power over the national economy”.[15]
Despite the lack of precision of this doctrine, it appears that the major questions doctrine is based on the distinction between delegation on ordinary and extraordinary matters. In the former case, delegation is ruled by the Chevron doctrine, and courts must defer to an agency’s reasonable interpretation of an ambiguous delegation. But in the latter case, the delegation cannot be ambiguous. On the contrary, in areas of “vast economic and political significance”, the delegation must be clear. Consequently, if the Statute uses ambiguous legal concepts – as is common in complex regulatory matters, such as environmental protection – agencies could be prevented from construing the statute to exert expansive regulatory powers.
The Principle of Legal Reserve in Comparative Constitutional Law: the case of Spain.
The distinction between ordinary and extraordinary matters that relies on the major questions doctrine, resembles the theory of legal reserve in Continental European Constitutional Law, particularly in Spain and Germany.
The influence of French Administrative Law can be seen in the mechanisms used to allocate the rulemaking power between the Legislative and Public Administration. [16] We can differentiate two models from a comparative perspective.
In one model, the Constitution vests in the Executive rulemaking power. This is the case with Art. 97 of the Spanish Constitution. In other models, the Constitution does not grant this power, and therefore, the Legislative needs to confer this authority through a specific habilitation contained in a Law. Such is the case with German Constitution, which provides that the Executive can issue rules based on a legislative habilitation (Art. 80.1).
In the first model, the Executive’s chief has a general rulemaking power, which means that it is not necessary to have legislative habilitation to issue rules. In Spanish Constitutional Law, this has led to the so-called “independent rules,” enacted not in application of a specific Law but in subordination to the legality principle.[17]
The general recognition of the rulemaking powers generates conflicts with the legality principle. In 1959, the Spanish jurist Eduardo García de Enterría developed a theory of the rulemaking power, aimed to prevent arbitrariness, while acknowledging the necessity of this discretionary power for the modern state.[18]
Two general premises form the basis of García de Enterría’s theory. The first one is that, in the modern state, rules cannot be restricted to formal Law, that is, the Law enacted by the Legislature.[19] The second one is that the rulemaking power must be cabined not only by the Law but also by general principles.[20]
Following the German scholars (Otto Bachof), García de Enterría proposed that the rulemaking power is not only limited to the Law enacted by the Legislative branch, but also, by a value system (Wertordnung).[21] The German Law was particularly beneficial because, due to the lack of a general rulemaking power recognized in the Constitution, the Constitutional Tribunal distinguishes between the areas that the administrative rulemaking can address, and the areas that the Legislative must cover, known as areas reserved to the Law.[22]
The areas reserved to the Law are “essential” for a democratic society. In a ruling dated March 14, 1972, the German Constitutional Tribunal concluded that the restriction of fundamental rights, according to Art. 19.1 of the Constitution, must be adopted by Law. However, in those areas the administrative rulemaking power is not excluded. As García de Enterría explains, the Public Administration can issue rules in areas reserved to the Law, if those rules are the necessary complement to the Law.[23]
The theory of the essential areas refers not only to the matters reserved for Law, such as fundamental rights restrictions, but also to the minimum legal coverage that the Law must have. Scholars have particularly analyzed the minimum coverage regarding economic regulation in Spanish Constitutional Law. [24] Following García de Enterría’s thesis, the general conclusion is that the Law must cover the basic or essential aspect of the regulation, including the objectives that the administrative regulation must achieve. Within this broader legal framework, the Public Administration can exert a discretionary rulemaking power to complement the Law.[25]
The main contribution of Eduardo García de Enterría´s theory is the design of a model that prevents two extremes: the reduction of the rulemaking power to the mechanical implementation of the Law, or the recognition of an unconstrained power. In essential areas reserved to the Law, the Law must cover the basic framework of the regulation, and the Public Administration can complement this framework based on discretionary rulemaking powers. To ensure that this power is not exercised arbitrarily while allowing for discretion, the rules must also adhere to general principles. Thus, the complementary nature of the rulemaking powers means that the Public Administration is not limited to mechanically implementing the Law. [26]
The major question doctrine and the principle of legal reserve: a comparison.
The major question doctrine and the legal reserve theory share a common element: the recognition that in certain “essential” matters, the Legislative branch must be the primary decision-maker. In both cases, the goal is to allocate rulemaking power between the Executive and Legislative branches, vesting in the Legislative essential, extraordinary, or major decisions.
However, there are at least two key differences between these approaches. Firstly, the identification of what constitutes an “essential” area varies between the two theories. The principle of legal reserve is based on constitutional provisions that require regulation in matters such as fundamental rights and freedoms to be addressed by Law (as set out in Article 53.1 of the Spanish Constitution).[27] The Spanish Constitutional Tribunal has established that the Law must also specify the purpose, conditions, and safeguards of such regulations.[28]
In contrast, the major questions doctrine (as applied in West Virginia) does not specify what areas are considered “major” for legislative decision-making. Modern administrative states cover broad areas such as environmental protection and financial regulation, which could all be considered of vast economic and political significance. This benchmark is therefore wider than the essential standard that determines the areas reserved to the Law.
The second difference relates to the consequences of these theories. As explained by Eduardo García de Enterría, in areas reserved to the Law, administrative rules are not excluded, nor are they restricted to the mechanical implementation of the Law. Even in essential areas, the Public Administration can exert its rulemaking power, as long the rules enacted are the indispensable complement of the Law.[29] In that sense, and in a world of motorized laws[30], the administrative rules in essential areas could improve legal certainty, as particularly happens regarding regulation.
It is unclear if the major question doctrine in West Virginia follows what Sunstein called the hard interpretation.[31] It seems that in areas of “vast economic and political significance”, the Supreme Court denies that the agencies could interpret and construe ambiguous legal concepts. Eventually, this conclusion could pave the way to conclude that in those areas, the Statute cannot use ambiguous concepts to “delegate” interpretive power to agencies. As a result, the Chevron doctrine would not be applicable.
From the agencies as creatures of the lex to the agencies as creatures of the ius
As Bernard Schwartz explained, one of the key differences between U.S. Administrative Law and the Continental European Administrative Law is that the former is centered on the agencies, while the latter is centered on the Public Administration.[32]
The major question doctrine in National Federation of Independent Business and West Virginia, is based on a limited concept of agencies as creatures of statute, which suggests that, in vast areas, they can only execute the Law and not construe it.
As the German scholar Fleiner explained, the Public Administration’s activity goes beyond the mechanical execution of the Law.[33] The Public Administration -Bachof- has a fiduciary duty regarding personal wellbeing.[34] For example, Article 103.1 of the Spanish Constitution defines Public Administration as an organization that serves the general interest, subject to the law (lex) and general principles of law (ius). Only the Public Administration serves the general interest, interpreted as the service of the people. This fiduciary definition clarifies that the Public Administration cannot reduce itself to a mere creature of the Law[35] and must exercise discretionary power to fulfill its constitutional role.[36]
The discretionary rulemaking power that the Public Administration requires to fulfill its constitutional role as a fiduciary organization does not mean an unconstrained power. As García de Enterría explains, the Public Administration always exerts subordinate powers under the checks and balances principles, with the specific aim of preventing arbitrariness. particularly, as Art. 9.3 of the Constitution states.[37]
For that purpose, and from a comparative perspective, the constitutional foundations of the U.S. Administrative Law should move from the lex to the ius. Agencies cannot be just creatures of the lex, but creatures of the ius. General principles of Law should also constrain the agencies’ regulation, without reducing it to the mechanical implementation of the Statute. That is, precisely, the role of the morality principles of Administrative Law in the U.S., proposed by Sunstein and Vermeule.[38]
Therefore, it is crucial that the major question doctrine aligns with the principle of legal reserve in Spanish Constitutional Law. This means that the Statute should provide a framework for the regulation, with discretionary regulations from agencies serving as a necessary complement to the statute and subject to general principles of Law.
Suggested citation: José Ignacio Hernández G., The Major Questions Doctrine and the Principle of Legal Reserve: A Comparison between the U.S. and Spain, Int’l J. Const. L. Blog, Apr. 12, 2023, at: http://www.iconnectblog.com/2023/04/the-major-questions-doctrine-and-the-principle-of-legal-reserve-a-comparison-between-the-us-and-spain/
[1] The concept presented in this post, which summarizes ongoing research, was first discussed in Professor Vichy Jackson’s Reading Group on Constitutional Dimensions of the Administrative State at Harvard Law School on March 6, 2023. I am grateful for Professor Jackson’s valuable insights and comments, as well as for the discussion with Oren Tamir, a post-doctoral research fellow at Harvard Law, regarding the major questions doctrine. The conclusions of the post are solely those of the author.
[2] Hamburger, Philip (2014), Is Administrative Law Unlawful?, Chicago:University of Chicago Press, 377.
[3] Sunstein, Cass and Vermeule, Adrian (2020), Law & Leviathan. Redeeming the administrative state, Cambridge: The Belknap Press of Harvard University Press, 116.
[4] National Federation of Independent Business v. Department of Labor, Occupational Safety and Health Administration, 595 U. S. ____ (2022)
[5] West Virginia v. Environmental Protection Agency, 597 U.S. ___ (2022)
[6] Eduardo García de Enterría explains that delegation has different meanings in the US and Spain. In the US, it refers to the Congress granting agencies the authority to exercise administrative powers, but any rules enacted will not have the same rank as laws. In Spain, delegation refers to exceptional cases where the legislature authorizes the Executive to exercise legislative power and issue rules with a similar rank as laws. See García de Enterría, Eduardo (1978), “Algunas reflexiones sobre el Derecho Administrativo Norteamericano (a propósito de una nueva sistematización del mismo”, in 85 Revista de Administración Pública N° 85, 241.
[7] FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120 160-61 (2000).
[8] Utility Air Regulatory Group v. Environmental Protection Agency, 573 U.S. 302 (2014), at 324.
[9] Breyer, Stephen (1986), “Judicial review of questions of Law and Policy”, Administrative Law Review 38 (4), 363. According to Breyer, “Congress is more likely to have focused upon, and answered, major questions, while leaving interstitial matters to answer themselves in the course of the statute’s daily administration” (370).
[10] Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984)
[11] Sunstein, Cass R. (2019) “’Chevron’ as Law” The Georgetown Law Journal 107 (6), 1669. The “Chevron carve-out” was applied in the FDA.
[12] Based on the Utility Air Regulatory Group case. See Sunstein, Cass R. (2021), “There are two major question doctrines”, Administrative Law Review 73 (3), 475.
[13] 595 U. S. ____ (2022), at 5.
[14] Id., at 2.
[15] 597 U.S. ___ (2022), at 19, quoting Utility Air Regulatory Group.
[16] Under French Law, the term “Public Administration” refers to the Executive branch acting through administrative powers. The Executive can also act based on governmental powers, such as issuing decrees comparable in rank to the Law. The rulemaking power in Administrative Law refers to the Executive’s authority to issue rules subordinated to the Law. In France, these rules are known as règlements. See Vedel, George (1955), “Les bases constitutionnelles du Droit Administratif”, Etudes et Documents, Paris : Conseil D’État, Paris, 22. We refer to administrative rules -or regulations in the U.S.- in reference to the rules approved by the Executive acting in subordination to the Law, or règlement (reglamento, in Spanish).
[17] There are two types of administrative rules: executive rules and independent rules. Executive rules are issued to implement a specific law. On the other hand, independent rules are not related to a specific law but are based on the general legal framework, specifically the principle of legality. However, it is important to note that even independent rules are always subordinate to the principle of legality. See Esteve Pardo, José (2021), Lecciones de Derecho administrativo, Madrid: Marcial Pons, 68-69.
[18] García de Enterría, Eduardo (1959), “La interdicción de la arbitrariedad en la potestad reglamentaria”, 30 Revista de Administration Pública, 131.
[19] Id., at 155. Quoting Carl Schmitt, García de Enterría refers to the crisis of the formal legality, that is, the Law enacted by the Legislative.
[20] See García de Enterría, Eduardo (1963), “Reflexiones sobre la Ley y los Principios Generales del Derecho en el Derecho Administrativo”, in 40 Revista de Derecho Administrativo, 189.
[21] García de Enterría, Eduardo (n 18), 156.
[22] Muñoz Machado, Santiago (2015), Tratado de Derecho Administrativo y Derecho Público General. Tomo VII. El Reglamento, Madrid: Boletín Oficial del Estado, 51
[23] García de Enterría, Eduardo (1998), Legislación delegada, potestad reglamentaria y control judicial, Madrid: Civitas, 215.
[24] Ortega, Rivero (2021), Derecho Administrativo Económico, Madrid: Marcial Pons, 71.
[25] See my analysis in Hernández G., José Ignacio (2004), La libertad de empresa y sus garantías jurídicas. Estudio comparado del Derecho Español y Venezolano, Caracas: FUNEDA, 123.
[26] García de Enterría, Eduardo (n 23).
[27] Following German Constitutional Law, essential areas are subject to dynamic interpretation, but the Constitution provides clear guidance nonetheless. Muñoz Machado, Santiago (n 20), 53.
[28] Ruling n° 76/2019, dated May 22, legal consideration n° 8.
[29] García de Enterría, Eduardo (n 23).
[30] The expression was originally used by García de Enterría in 1963 (n 20) and later developed in García de Enterría, Eduardo (1999), Justicia y seguridad jurídica en un mundo de leyes desbocadas, Madrid: Civitas, 47-52. Regarding the problems of the “motorized lawmaking”, from the U.S. perspective, see Vermeule, Adrian, “Rules, Commands, and Principles in the Administrative State” (2021), 130 Yale Law Journal, 360.
[31] Sunstein, Cass (n 11).
[32] Schwartz, Bernard (1984), Administrative Law, Boston: Little, Brown and Company, 2-3.
[33] Fleiner, Fritz (1933), Les príncipes gènèraux du Droit administratif allemand, Librairie delagrave: Paris, 12.
[34] Wolff, Hans; Bachof, Otto and Stober, Rolf (2006), Direito Administrativo, Vol. 1, Porto: Fundaçao Calouste Gulbenkian, 41.
[35] In Spain, as in other European countries, there has been an ongoing debate about the criteria used to define the core activities of the Public Administration. The mere mechanical execution of the Law is not a sufficient criterion because the Public Administration requires a certain degree of discretionary power to effectively serve the public.. See Parejo Alfonso, Luciano, (1982), El concepto del Derecho administrativo, Caracas: Editorial Jurídica Venezolana, 35. This is why the general principles of Law are important: they ensure the rational activity of the Public Administration without the rigor of the positive legalism.
[36] The Public Administration “is not the community´s representative, but an organization designed to serve the community”. The fiduciary concept of the Public Administration involves a stewardship function. See García de Enterría, Eduardo and Fernández, Tomás-Ramón (2006), Curso de Derecho Administrativo, I, Madrid: Thomson-Civitas, 35
[37] García de Enterría, Eduardo (n 23).
[38] Sunstein, Cass y Vermeule, Adrian (2020), Law & Leviathan. Redeeming the administrative state, Cambridge: The Belknap Press of Harvard University Press, 8. See my analysis regarding the comparison between the morality principles and the general principles of Administrative Law, in Hernández G., José Ignacio (2021), “La moralidad del derecho administrativo en Estados Unidos: una visión comparada desde los principios generales del derecho administrativo en América Latina”, 125 Revista de Administración Pública, 289.
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