Occupational Board Antitrust Reform Act

Occupational Board Antitrust Reform Act

A bill for an act relating to occupational regulations contrary to the Sherman (Antitrust) Act; establishing the state policy for the regulation of occupations, specifying criteria for government regulation to increase opportunities, promote competition, encourage innovation, protect consumers, and comply with federal antitrust law; proposing coding for new law as ____________, chapter ____.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ____________:

100.01     Policy. For occupational regulations and their boards, it is the policy of this State that:

  1. Where the state finds it is necessary to displace competition, it will use the least restrictive regulation to protect consumers from present, significant, and substantiated harms that threaten public health and safety.2.           The governor will establish an office of antitrust and active supervision of occupational boards.
    The office is responsible for actively supervising the state’s occupational boards.100.02     Antitrust law. By establishing and executing the policies in section 100.01, the State intends to ensure that occupational boards and board members will avoid liability under federal antitrust laws.

100.03     Definitions.

Subdivision 1. Scope. For the purposes of this chapter, the words defined in this section have the meaning given.

Subd. 2. Active supervision. (a) “Active supervision” means the attorney general or designee will independently:

  1. play a substantial role in the determination of an occupational board’s rules and policies to ensure they benefit consumers and not serve private interests of providers of goods and services who the board regulates;[1]
  2. disapprove the use of any board rule or policy and terminate any enforcement action outstanding at the time of this act’s enactment and subsequently that fails to accord with section 100.01;[2] and
  3. exercise control over each of the boards by reviewing and affirmatively approving only rules, policies and enforcement actions that are consistent with section 100.01.[3]

(b) A government or private attorney providing general counsel to a board does not meet the requirement for active supervision.

Subd. 3. Government certification. “Government certification” is a voluntary program in which the state government grants nontransferable recognition to an individual who meets personal qualifications established by state government. Upon receiving initial and continuing approval from the government, the individual may use “government certified” or “state certified” as a designated title. A non-certified individual may also perform the lawful occupation for compensation but may not use the title “government certified” or “state certified.” In this chapter, “government certification” is not intended to be synonymous with “occupational license” or to reflect credentials, such as those used for medical board certification or held by a certified public accountant, which are prerequisites to working lawfully in an occupation.

Subd. 4. Lawful occupation. “Lawful occupation” means a course of conduct, pursuit or profession that includes the sale of goods or services that are not themselves illegal to sell irrespective of whether the individual selling them is subject to an occupational regulation.

Subd. 5. Least restrictive regulation. “Least restrictive regulation” means, from least to most restrictive,

  1. market competition,
  1. third-party or consumer-created ratings and reviews,
  1.  private certification,
  2. voluntary bonding or insurance.
  3. a specific private civil cause of action to remedy consumer harm,
  4. a deceptive trade practice act,
  5. mandatory disclosure of attributes of the specific good or service,
  6. a regulation of the process of providing the specific goods or services
    to consumers,
  7. regulation of the facility where the specific good or service is sold
  8. inspection,
  9.               bonding,
  10. insurance,
  11. government registration,
  12.               government certification,
  13. specialty occupational license for medical reimbursement and
  14. occupational license.

 

Subd. 6. Occupational license. “Occupational license” is a nontransferable authorization in law for an individual to perform a lawful occupation for compensation based on meeting personal qualifications established by the legislature. In an occupation for which a license is required, it is illegal for an individual who does not possess a valid occupational license to perform the occupation for compensation.

Subd. 7. Occupational regulation. “Occupational regulation” means a statute, rule, practice, policy or other state law requiring an individual to possess certain personal qualifications to use an occupational title or work in a lawful occupation. It includes registration, certification and occupational license. It excludes a business license, facility license, building permit, or zoning and land use regulation except to the extent those state laws regulate an individual’s personal qualifications to perform a lawful occupation.

Subd. 8. Personal qualifications. “Personal qualifications” are criteria related to an individual’s personal background and characteristics including completion of an approved educational program, satisfactory performance on an examination, work experience, other evidence of attainment of requisite skills or knowledge, moral character, criminal history and completion of continuing education.

Subd. 9. Government registration. “Government registration” means a requirement to give notice to the government that may include the individual’s name and address, the individual’s agent for service of process, the location of the activity to be performed, and a description of the service the individual provides. “Government registration” does not include personal qualifications but may require a bond or insurance. Upon the government’s receipt of notice, the individual may use “registered” as a designated title. A non-registered individual may not perform the occupation for compensation or use “registered” as a designated title. “Government registration” is not transferable. In this chapter, “government registration” is not intended to be synonymous with “occupational license” or to reflect credentials, such as those held by a registered nurse, which are prerequisites to working lawfully in an occupation.

Subd. 10. Private certification. “Private certification” is a voluntary program in which a private organization grants nontransferable recognition to an individual who meets personal qualifications established by the private organization. The individual may use a designated title of “certified” in conjunction with the private organization’s name, as permitted by the private organization.

Subd. 11. Specialty occupational license for medical reimbursement. “Specialty occupational license for medical reimbursement” means a non-transferable authorization in law for an individual to qualify for payment or reimbursement from a government agency for the non-exclusive provision of medical services based on meeting personal qualifications established by the legislature. A private company may recognize this credential. Notwithstanding this specialty license, it is legal for a person regulated under another occupational regulation to provide similar services as defined in that statute for compensation and reimbursement. It is also legal for an individual who does not possess this specialty license to provide the identified medical services for compensation, but the non-licensed individual will not qualify for payment or reimbursement from a government agency.

100.

100.05     Office of Antitrust and Active Supervision of Occupational Boards

Subdivision 1. Office of Supervision of Occupational Boards. The governor will establish the Office of Antitrust and Active Supervision of Occupational Boards.

Subd. 2. Responsibility. The office is responsible for active  supervision of the state’s occupational boards to ensure compliance with the policies in section 100.01, the applicable licensing statutes, and federal and state antitrust laws.  Active supervision requires the office to play a substantial role in the development of boards’ rules and policies to ensure they benefit predominantly consumers and not serve merely private interests of providers who the boards regulate.

Subd.3. Personnel. The office personnel must be independent of boards. A government or private attorney who provides general counsel to a board  may not serve in the office.

Subd. 4. Approval. The office will exercise control over boards’ processes and substantive actions to ensure they are consistent with the policies in section 100.01, the applicable licensing statutes and federal and state antitrust laws. The office must review and approve or reject any proposed board rule, policy, enforcement, or other regulatory action prior to it being adopted or implemented. The office’s approval must be explicit; silence or failure to act shall not be deemed approval.

Sub. 5. Cost Allocation. The office may assess its costs on each board for the services of active supervision. Each board may recoup the assessment by increasing the fees paid by license holders.100.06   Construction. Nothing in this Act shall be construed (1) to require an employer or consumer to employ or contract with a worker who is not licensed or state certified, (2) to preempt federal regulations or (3) to require a private certification organization to grant or deny private certification to any individual.

100.07    Effective date. This chapter is effective on _____________.

[1] FTC v. Ticor Title Ins. Co., 504 U.S. 621, 634–635 (1992) (stating the purpose of active supervision is to determine “whether the State has played a substantial role in determining the specifics of the . . . policy” and that the policy was “established as a product of deliberate state intervention, not simply by agreement among private parties”). See Hallie v. Eau Claire, 471 U.S. 34, 47 (1985) (“Where a private party is engaging in the anticompetitive activity, there is a real danger that he is acting to further his own interests, rather than the governmental interests of the state.”) and Goldfarb v. Va. State Bar, 421 U.S. 773, 791–792 (1975) (denying immunity to a state agency that “joined in what is essentially a private anticompetitive activity” for “the benefit of its members”).

[2] Patrick v. Burget, 486 U.S. 94, 101 (1988) (“The active supervision prong of the Midcal test requires that state officials have and exercise power to review particular anticompetitive acts of private parties and disapprove those that fail to accord with state policy.”).

[3] N.C. State Bd. of Dental Exam’rs v. FTC, 135 S. Ct. 1101, 1112 (2015) (holding active supervision “require[s] the State to review and approve interstitial policies made by the entity claiming immunity” to provide “realistic assurance that a private party’s anticompetitive conduct promotes state policy . . . .”) (quoting Patrick, 486 U.S. at 101).

 

Amended and re-approved by the ALEC Board of Directors on March 2, 2019.