Reviews and Appeals of Regulatory Decisions

The specific mechanisms and procedures for developing, reviewing and appealing regulatory rules and decisions¹ vary from system to system because they depend on historical and institutional peculiarities, which are often specific for each country. However, general principles apply, including inclusiveness, transparency, and simple methods for citizen participation. In this context, distinctions can be made between the executive, legislative and judicial interventions in the regulatory process as they represent different approaches to pursuing the country’s interests. Checks and balances among these branches of government are in order to provide legitimacy and stability to the regulatory system.

An important step in the regulatory process is the choice of instruments, including administrative procedures, specific legislation, contracts and presidential decrees.² The choice of instrument affects processes for stakeholder input and appeal. For example, legislation may be used to define the powers of the regulator, agency procedures, and operator obligations and rights, including rights of appeal. Contracts might have different appeal procedures, including to international dispute resolution bodies, and different operators can be treated differently.

Countries often adopt two levels of appeals. The first level is to the regulatory agency itself, where stakeholders can ask the regulator to reconsider a decision. The second level is to an administrative tribunal or the court system, which are sometimes restricted to considering whether the regulator followed the law in making her decision. In some countries courts can also consider whether the regulator was substantively correct in her decision. This involves second-guessing the regulator, so courts sometimes defer to the regulatory agency because the regulator has more specialized knowledge than do the courts. Countries that regulate by license sometimes have another layer of appeal, namely the licensing authority. An appeal to the licensing authority may be triggered if the regulatory decision requires a change to the operating license. Another level of appeal may be to the legislative body or president. These appeals change the laws under which the regulator operates and so are often reserved for problems in the structure of regulation itself.

Some regulatory controversies may be best resolved through alternative dispute resolution processes when traditional means of resolution are costly, time consuming, and unpredictable. Alternative dispute resolution includes:

• Negotiation, which is a voluntary process of discussion without a third party to facilitate;
• Mediation, where a third party or mediator facilitates the process and may suggest a resolution, but may not impose one;
• Arbitration, where the parties voluntarily place in the hands of a third party or arbiter the solution to their dispute, committing themselves to abide by its decision. The arbiter is often a collegiate body of persons, with expertise in the matter being disputed.

Footnotes

1. See Development, Review, and Appeal of Regulatory Rules and Decisions.
2. See Regulatory Instruments of the first chapter for other information on regulatory instruments.