FERC Interlocking Director Rules—A Guide to Compliance

FERC has recently stepped up enforcement of many provisions of the Federal Power Act ("FPA"), including Section 305, which imposes limitations on persons who serve as officers or directors of public utility companies. Section 305 requires preapproval by FERC for a person to hold an officer or director position at more than one public utility or at a public utility and certain other specified companies. In addition, public utility officers and directors must make an annual report filing with FERC that lists all relevant interlocks—that is, cases where they also serve as officer or director of specified other entities. After years of casually enforcing these rules, FERC has recently adopted new, tough requirements and no longer tolerates any late filings. FERC has also audited a number of public utilities in recent months to determine their level of compliance with these rules.