Chevron is key to innovation. Provides regulatory certainty for small businesses.

II. CHEVRON PROMOTES THE REGULATORY CERTAINTY NECESSARY FOR SMALL BUSINESSES.

This Court has recognized the “stabilizing purpose of Chevron.” City of Arlington, Tex. v. F.C.C., 569 U.S. 290, 307 (2013). Chevron provides a predictable framework for interpreting regulations, giving deference to agency decisions in the face of ambiguity and therefore allowing businesses to better rely on regulations and plan for the future. Chevron also promotes the rule of law by serving as a check on judicial power. Chevron deference has been shown to curb the judiciary from imposing its own ideological or policy-driven perspectives when interpreting regulations. Both create more stability in the regulatory environment, stability that is of critical importance for small businesses. Removing this framework will set off a cascade of consequences that will harm small businesses, stifle innovation, and undermine progress towards a more equitable economy. Small businesses must already navigate a dynamic and uncertain environment without being subject to the regulatory instability that would ensue if Chevron were overturned.

1. For nearly 40 years, Chevron has provided a consistent framework for court interpretation of regulations, resulting in a more uniform and predictable interpretation of regulations across time and geography.

Prior to Chevron, courts engaged in statute-by-statute evaluation of agency interpretations—a “font of uncertainty and litigation.”22 Federal courts provided some deference to agency interpretations. However, questions on the degree of deference that should be “given by courts to an agency’s interpretation of a statute produced a large number of statutory interpretation opinions that defy easy reconciliation.”23

This Court’s decision in Chevron resolved that inconsistency. By recognizing that “ambiguity in a statute” represents a legislative intent to “confer[] discretion upon the agency,” the Court ensured that all federal courts would apply the same framework for evaluating and determining whether to defer to regulations.24 This framework has governed for nearly 40 years. Since its imposition, regulated entities—including small businesses—have been able to justifiably rely on a predictable structure in which courts will interpret federal regulations when ordering their affairs, rather than being subject to the whiplash of unpredictable litigation and court decisions. It is reasonable for a business to assume that a regulation imposing a workplace safety standard will continue to apply five years down the line, knowing that in any legal challenge, a court would be instructed to rely on this reasonable interpretation in the face of ambiguity.

Petitioners’ amici suggest that Chevron does not engender predictability, as agencies can change their interpretation of an ambiguous statute.25 This misunderstands what is meant by “predictability.” To alter a preexisting regulatory interpretation, an agency is required to commence and complete notice-and-comment rulemaking. This is no small feat. Agencies are required to give affected parties— including interested small businesses and groups— an opportunity to provide comment. Small businesses are afforded special protections during notice and comment rulemaking. Pursuant to the Small Business Regulatory Enforcement Fairness Act (SBREFA) of 1996, certain agencies are required to meet with impacted small businesses prior to proposing rules that would have a significant economic impact on a substantial number of small entities.26 This process allows small businesses to weigh in—in advance—on ways that agencies can ease any regulatory burden, as well as to describe reliance interests that should be accorded consideration.

Formal rulemaking also takes time. One study estimated that the average length of time necessary to complete a rulemaking was four years, with a range of one to 14 years.27 So there is rarely a concern that small businesses will be jolted by sudden regulatory change.

No such protection and process are afforded with unconstrained judicial review. Under a regime without Chevron deference, the regulatory landscape could—and will—change overnight at almost any time due to a new interpretation by a single court. This would be particularly burdensome on small businesses, which do not have the resources to monitor all 107 federal courts for every pending lawsuit that could impact their business, much less participate in such cases. Without Chevron, small businesses would face untenable uncertainty.

Chevron likewise encourages the uniform interpretation of federal regulations across each of the 13 federal courts of appeal and the 94 federal district courts. By constraining the federal courts, it ensures that judges are likely to reach similar conclusions as to the reasonableness of a regulation regardless of their location.28 Without it, regulated entities might be subject to one interpretation of a federal regulation in Mississippi and another in Maine.29 This is particularly problematic given this Court’s “practical inability in most cases to give its own precise renditions of statutory meaning,” which “virtually assures that circuit readings will be diverse.”30 Thirteen Courts of Appeals applying different standards “would render the binding effect of agency rules unpredictable and destroy the whole stabilizing purpose of Chevron.” City of Arlington, Tex., 569 U.S. at 307.