H.J.Res. 37: Disapproving the rule submitted by the Federal Communications Commission with respect to regulating the Internet and broadband industry practices

H.J.Res. 37

Disapproving the rule submitted by the Federal Communications Commission with respect to regulating the Internet and broadband industry practices

Date
April 5, 2011 (112th Congress, 1st Session)

Staff Contact
Sarah Makin

Floor Situation

On Tuesday, April 5, 2011, the House is scheduled to consider H.Res. 200, the rule providing for consideration of H.J. Res. 37, an Act disapproving of the rule submitted by the Federal Communications Commission with respect to regulating the Internet and broadband industry practices.  The rule would provide for one hour of debate, and one motion to recommit. 

 

Complete consideration of H.J.Res. 37 is expected on Thursday, April 7, 2011.  The resolution was introduced by Rep. Greg Walden (R-OR) on February 16, 2011, and was referred to the House Committee on Energy and Commerce.  The Committee held a markup of H.J.Res. 37 on March 15, 2011, and ordered the bill to be reported by a vote of 30-23.

Bill Summary

H.J.Res. 37 resolves that:

 

“Congress disapproves the rule submitted by the Federal Communications Commission relating to the matter of preserving the open Internet and broadband industry practices (Report and Order FCC 10-201, adopted by the Commission on December 21, 2010), and such rule shall have no force or effect.”

 

The Congressional Review Act allows Congress to undo a regulatory agency’s action within 60 days of its adoption by voting to approve a “motion of disapproval” that cannot be blocked by a filibuster in the Senate.

Background

On December 21, 2010, the Federal Communications Commission (FCC) issued a net-neutrality rule which would prohibit Internet providers from deliberately slowing or blocking legal websites or Internet services because of concerns over bandwidth.  The agency imposed fewer rules on mobile broadband networks, but required all broadband providers to provide more information about their services to subscribers, including information on actual download speeds. 

 

In April 2010, a federal appeals court halted the FCC’s attempt to enact net-neutrality rules by stating that the FCC does not have the authority to do so.  The decision, issued by the U.S. Court of Appeals for the District of Columbia, stated:

 

… [N]otwithstanding the “difficult regulatory problem of rapid technological change” posed by the communications industry, “the allowance of wide latitude in the exercise of delegated powers is not the equivalent of untrammeled freedom to regulate activities over which the statute fails to confer . . .Commission authority.”

 

In May 2010, seventy-four House Democrats sent a letter to FCC Chairman Genachowski making the case that net-neutrality rules will “jeopardize jobs” and "should not be done without additional direction from Congress."  Thirty-seven Senate Republicans sent a similar letter accusing Chairman Genachowski of pushing “heavy-handed 19th century regulations" that are illegal and "inconceivable.”

 

In contrast to Chairman Genachowski’s support for the proposed rules, FCC Commissioner Robert McDowell has been a vocal opponent of the net neutrality policy.  He has publically stated that the policy is not needed, and that regulation by the FCC can lead to even greater programs, such as rival Internet providers attaching each other in hopes of increasing the regulation on their competition.  According to Commissioner McDowell, “Everybody wants an open Internet that enhances freedom, but that’s what we have today.  We already have enough consumer protection laws on the books to cure many of the hypothesized fears (that some see).  The goal should be to make the market more competitive.  All we are going to do with this FCC decision is clog up the courts and increase billable hours for lawyers; litigation will supplant innovation.”


In January 2011, two phone companies, Verizon Communications Inc. and MetroPCS Communications Inc., sued the FCC to overturn the net-neutrality rule in a federal appeals court.  More lawsuits are expected after the FCC formally publishes the new rules.

 

According to the bill’s sponsor, Rep. Greg Walden (R-OR), the FCC’s new rules are anticompetitive and represent a case of the agency going too far.  Walden was quoted in a recent article saying, “I don’t think the FCC has the authority to set these so-called net neutrality rules … There’s a broad chorus of congressional voices that agree the FCC overstepped its bounds.”

Cost

H.J. Res. 37 would invoke a legislative process established by the Congressional Review Act to disapprove of the open Internet rule.  According to CBO, if H.J. Res. 37 is enacted, the published rule would have no force or effect.  Based on information from the FCC, CBO estimates that voiding this rule would have no effect on the budget.  Enacting H.J. Res. 37 would not affect direct spending or revenues; therefore, pay-as-you-go procedures do not apply.