Who Regulates Arbitration?

That's the name of this article by law prof David Noll. Here is the abstract:

One of the most important battles currently being fought in the United States' "arbitration wars" involves regulation by federal administrative agencies. Since 2014, the Consumer Financial Protection Bureau, National Labor Relations Board, Center for Medicare and Medicaid Services, and Departments of Defense, Labor, and Education have all regulated mandatory arbitration or barred its use in particular domains. Legal challenges to these agency actions provoked a series of clashes over agencies' authority to regulate arbitration that have divided lower courts, with some courts holding that a grant of substantive regulatory authority includes the authority to regulate arbitration and others courts expressly disagreeing. At the core of these disputes is the Federal Arbitration Act's relationship to substantive regulatory statutes: Does the FAA bar agencies from regulating arbitration under a substantive regulatory statute or can the FAA be reconciled with substantive statutes in a way that preserves agencies' authority to regulate? 

This Article makes three contributions to debates over that question. First, the Article shows that recent court/agency conflicts grow out of the Supreme Court's re-interpretation of the FAA rather than any action of Congress. The FAA and substantive regulatory statutes were long assumed to operate independently of one another, but beginning in the 1980s, the Court reinterpreted the FAA to allow arbitration of statutory claims and give private parties significant control over disputes resolution procedure. When the Court did so, it put the FAA at odds with substantive regulatory statutes that agencies are charged with administering. Second, the Article shows that, as a result of the Court's renovation of the FAA, the laws Congress has enacted and standard guides to their meaning generally do not address the FAA's relationship to substantive regulatory statutes. Finally, the Article shows that within this context disputes over agencies' authority to regulate arbitration are best resolved through a new canon of statutory interpretation that recognizes agencies' authority to regulate arbitration – but only when arbitration violates a right an agency enforces or a policy the agency is expressly charged with implementing. In contrast to the positions advanced in current debates over agency arbitration regulation, this canon accounts for all of the statutory policies relevant to agency arbitration regulation. The canon also allocates authority to regulate arbitration in a manner that tracks Congress's likely preferences and would dramatically reduce the transaction costs of resolving disputes over agencies' authority to regulate.

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