What specific steps does the Board take to issue a regulation?

The Administrative Procedure Act sets out the requirements for federal agencies, including the Federal Reserve Board, to follow when issuing proposed and final regulations. Other laws may also affect the rulemaking process.

Step 1: Proposed Regulation
A proposed regulation reflects an agency's effort to implement the law in the most effective and efficient manner possible. Each proposal includes a draft of the regulatory requirements, an explanation and justification of the proposed requirements, and an invitation for comments from the public. These proposals are published in the Federal Register, the daily journal of the U.S. government. The Board also maintains a list of its proposed regulations on its website.

Sometimes before the Board proposes a regulation, it issues a proposal in the Federal Register describing the objectives of the regulation it is considering proposing, and invites public comment on those objectives and how to implement them. This proposal is called an Advance Notice of Proposed Rulemaking.

Step 2: Comment Period
Proposed regulations typically ask for public comment by a specific date. The length of the comment period is tailored to provide the public with sufficient time to understand and formulate meaningful comments on the proposed regulation. Comment periods often are 60 days, but the period may be longer or shorter depending on the circumstances.

Step 3: Final Regulation
The Board carefully considers the comments it receives on a proposed regulation, and after a review of all the comments, the Board determines what changes should be made to the proposed regulation to reflect the comments and any additional analysis done by Board staff. At that point, the Board issues a final regulation.

Like a proposed regulation, a final regulation is accompanied by an explanation of its requirements and a discussion of how the Board addressed the comments received on the proposal. Unless set by law, there is no specific deadline for when a proposed regulation must be finalized. The time it takes for the Board to consider the comments and issue a final regulation depends on many factors, including the number of comments received and the complexity of issues involved.

Final regulations are published in the Federal Register and usually do not take effect until at least 30 days after they are published. In addition, final regulations often allow those affected by them substantial time beyond the effective date to conform their activities to the requirements.

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Last Update: June 29, 2018