Common use of Regulatory Impact Assessment Clause in Contracts

Regulatory Impact Assessment. 1. The Parties recognize that regulatory impact assessment is a tool to assist regulatory authorities in assessing the need for and potential impacts of regulations they are preparing. Each Party should encourage the use of regulatory impact assessments in appropriate circumstances when developing proposed regulations that have anticipated costs or impacts exceeding certain levels established by the Party. 2. Each Party shall maintain procedures that promote the consideration of the following when conducting a regulatory impact assessment: (a) the need for a proposed regulation, including a description of the nature and significance of the problem the regulation is intended to address; (b) feasible and appropriate regulatory and non-regulatory alternatives that would address the need identified in subparagraph (a), including the alternative of not regulating; (c) anticipated positive and negative impacts of the selected and other feasible alternatives (such as economic costs and benefits, social, environmental, public health, and safety effects) as well as risks and distributional effects over time, recognizing that qualitative analysis may be appropriate when costs and benefits are difficult to quantify or monetize due to inadequate information. A Party’s analysis of these impacts may vary according to the complexity of the issue as well as the available data and information; and (d) the grounds for concluding that the selected alternative is preferable. 3. Each Party should consider whether a proposed regulation may have significant adverse economic effects on a substantial number of small enterprises. If so, the Party should consider potential steps to minimize those adverse economic impacts, while allowing the Party to fulfill its objectives.