FTC puts occupational licensing boards on notice

Maureen Ohlhausen, acting chairman of the Federal Trade Commission, has created an Economic Liberty Task Force to focus on state occupational licensing activities. She announced it last month in a speech at George Mason Law Review’s antitrust symposium.

Looming behind this new task force is the Supreme Court decision in North Carolina Board of Dental Examiners v. Federal Trade Commission (2015) that a state licensing board may violate federal antitrust law if a controlling number of board members comprise “active market participants” regulated by the board. The ruling left a board’s immunity from antitrust law rather unclear — it is if the board’s actions clearly articulate state policy and are actively supervised by the state.

Here’s what this task force would mean for states, according to the National Law Review:

  • We will likely see an increase in FTC actions involving licensing boards, such as in North Carolina Dental, where it is not the state itself acting but self-interested active market incumbents who impose occupational licensing requirements that limit competition.

  • The FTC Task Force will seek to “eliminate and narrow overbroad occupational licensing restrictions that are not narrowly tailored to satisfy legitimate health and safety goals.”

  • The FTC will help states identify problematic occupational licensing and reforms that promote reciprocity among states. We could see a roll back of occupational regulations.

  • Licensing boards and those who are involved in licensing regulations should examine the ways in which the regulation affects or could affect competition, whether there is evidence that a regulation is necessary to achieve the targeted policy goal, whether the regulation is narrowly tailored to meet the policy goal, and whether a less restrictive alternative is available to achieve the policy goal and benefit competition.

The ice jam over occupational licensing is already starting to break. This could significantly speed up the thaw.

North Carolina leaders, take notice.

Jon Sanders / Director of Regulatory Studies

Jon Sanders studies regulatory policy, a veritable kudzu of invasive government and unintended consequences. As director of regulatory studies at the John Locke Foundation, Jo...

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