One of the most controversial points in the study being developed by an interministerial task force under the coordination of the Presidential Chief of Staff (Casa Civil) to propose ways of restructuring the nation?s regulators is the introduction of outside control mechanisms.
This could be done, among other means, through management contracts between directors of regulatory agencies and the ministries to which the agencies are subordinated. Each contract would be designed to guarantee achievement of the respective ministry?s policy objectives. Penalties would be imposed on the directors of agencies deemed to be in breach of such contracts.
The study acknowledges that management contracts would interfere with the autonomy of regulators and that abolition of tenure by allowing the Executive branch to remove directors ?would have a negative impact on the independence of agencies and the perceptions of private investors?. In return, it stresses, society would benefit by making regulators more accountable to the Government?s policymakers.
Other external control mechanisms are proposed by the study. For example, it says regulators should have to deliver reports to Congress on their activities, intensify public consultations, and hold more public hearings in advance of competitive bidding procedures to award licenses. It also suggests an exchange of information with industry councils and the creation of ombudsmen, absent from most agencies today.
Another important proposal is that Congress be empowered to make directors of regulatory bodies testify before key committees.
The study doesn?t address ways of resolving conflicts between agency decisions or institutionalizing the right to judicial review for affected parties. It merely suggests that judges shouldn?t be allowed to award summary restraining orders against regulatory decisions. Challenges would have to be subjected to full case hearings.
