U.S. President-elect Donald Trump has settled on the composition of the Republican-led Federal Trade Commission for his second term, announcing FTC Commissioner Andrew Ferguson will chair the agency while nominating Kressin Meador Powers Partner Mark Meador to the commissioner vacancy.
Ferguson, sworn in to his six-year FTC commissioner in April 2024, can be elevated to FTC chair without U.S. Senate confirmation because of his prior confirmation process as commissioner. The Senate will carry out a formal confirmation process for Meador, who has a prior FTC background of his own. FTC Commissioner Melissa Holyoak, confirmed for her six-year term in March 2024, rounds out the new Republican majority.
The nominations support what is expected to be a reversal of a majority of FTC policies and initiatives established in recent years under current FTC Chair Lina Khan. In a post on social platform X, Ferguson said U.S. businesses will "become stronger and more competitive" and the agency will "better serve workers and consumers, than ever before."
"At the FTC, we will end Big Tech's vendetta against competition and free speech," he added. "We will make sure that America is the world's technological leader and the best place for innovators to bring new ideas to life."
The proposed focus on innovation will likely lead to deregulation and a narrowed enforcement approach, which could specifically cut into the agency's data privacy and artificial intelligence work. The Khan-led FTC made waves with considerable privacy, AI and data security enforcement, with notable initiatives against data broker activities and alleged sensitive data misuse.
"Even if some of the ideas carry over, I expect that for optics and style reasons, the incoming chair will want any such initiatives to be his own," said Abundance Institute Head of AI Policy Neil Chilson, who previously served as acting FTC chief technologist and attorney advisor to the FTC chair. "There was a substantial period of time under Chair Khan with no Republican commissioners. There are a lot of matters from that period that Ferguson will want to scrutinize closely. Some might make it through, but I expect many to be modified or set aside entirely."
Changing course
The anticipated philosophy shift under Ferguson's leadership is likely to happen swiftly depending on the pace of Meador's confirmation process. Working to the agency's advantage is the familiarity Ferguson and Meador have with the inner workings of the FTC through their prior agency backgrounds.
"Ferguson will have an advantage immediately stepping into the role of chairman from his knowledge of the FTC staff and current slate of issues," said Wilson Sonsini Partner Maureen Ohlhausen, a former acting FTC chair and commissioner. "His statements on recent FTC actions demonstrate that he has thought carefully about the boundaries of the FTC’s authority in connection with hot issues like collection and use of location data and AI-enabled capabilities. Working cooperatively with staff is key to the success of any chair and his existing relationships will serve him well."
There might be a plan of attack waiting for the Republican majority once it has its footing. According to Punchbowl News, Ferguson's personal lobbying efforts for the chair appointment included an outline of agency priorities and goals he would pursue.
The proposed agenda includes specific intentions to curtail some of the Khan-led FTC's biggest digital policy initiatives. The Ferguson-led agency will "stop abusing FTC enforcement authorities as a substitute for comprehensive federal privacy legislation," while aiming to "end the FTC's attempt to become an AI regulator" and "terminate all initiatives investigating so-called ... AI 'bias.'"
Sitting Democratic FTC Commissioners Alvaro Bedoya and Rebecca Kelly Slaughter are questioning the direction Ferguson provided in his outline. They sent the chair-designate an open letter seeking answers to the validity of the proposed vision while calling out perceived omissions regarding consumer protection and civil rights.
"There has been a recent bipartisan alignment on the importance of challenging corporate power that threatens Americans' freedom and autonomy, and hurts working people and small businesses," Bedoya and Slaughter wrote. "We should not lose that. We urge you to correct the impression created by this document."
Goodwin Procter Partner and IAPP Westin Emeritus Fellow Omer Tene expects Ferguson's priorities to be the tip of the iceberg for a "starkly different" FTC. In addition to redefining privacy enforcement, Tene expects the incoming FTC to "no doubt roll back" the proposed rulemaking on commercial surveillance and lax data security.
Providence Group co-founder and Executive Chairman Dan Caprio, who served as chief of staff to former FTC Commissioner Orson Swindle, also characterized the privacy rulemaking as "dead" under Ferguson, alluding to the chair-designate's intentions to remove perceived regulatory uncertainty businesses faced in recent years.
"Ferguson pledged to end more novel and legally dubious consumer protection cases and said that businesses should not fear that the FTC will punish them for honest conduct," Caprio.
AI rethink
While a business-friendly approach to data privacy resonates with past Republican-led versions of the FTC, the agency's history of work on AI is mostly uncharted territory.
The Khan-led FTC began establishing precedent on unfair, deceptive, or abusive acts or practices in AI, with various cases focused on consumer harm. That approach fell in line with President Joe Biden's executive order on AI focused on establishing foundations for governance and safety principles.
President-elect Trump has vowed to roll back Biden's executive order in favor of innovation, which Ferguson has vocally advocated for on various occasions.
Ferguson supported the appointment of former PayPal Chief Operating Officer David Sacks as the Trump administration's AI lead, saying on X that Sacks "understands as well as anyone the threat posed by online censorship and bias, and the danger it poses to AI." Ferguson added Sacks "has the experience to foster innovation in these cutting-edge sectors."
The Abundance Institute's Chilson expects a continued FTC role policing false claims in AI, but reviews of existing rules and guidance will be on the table. For example, he said a look into how AI applications in health care are "hobbled by out-of-date restrictions on health data sharing" could "free up innovation."
One avenue the incoming FTC may pursue to shape AI policy without hard regulation is engaging in more advocacy.
"States are very active on AI legislation, and some of the bills could have significant anti-competitive effects without adding much consumer protection," Chilson said. "The FTC could use its long-standing policy advocacy capability to weigh in on such legislation to help ensure a vibrant AI ecosystem. Ferguson and Holyoak both have substantial state-level experience, so this could be an appealing initiative."
Joe Duball is the news editor for the IAPP.
