The Federal Communications Commission's top lawyer FCC General Counsel Thomas Johnson said the FCC did have power under the Communications Decency Act was passed by Congress as part of the Telecommunications Act of 1996, which was an update to the Communications Act of 1934 that established the FCC and provided it with regulatory authority. Johnson also pointed to Section 201(b) of the Communications Act, which gave the FCC power to "prescribe such rules and regulations as may be necessary in the public interest to carry out the provisions of this Act."
He said that the FCC can reinterpret Section 230 to claim some authority over social media platforms claiming they are common carriers.
However one problem with citing Section 201—which is part of the Communications Act's well-known Title II, is that the Pai FCC in 2017 justified its repeal of net neutrality rules by claiming that the commission has no authority to regulate broadband providers as common carriers under Title II—even though courts had specifically ruled the FCC does have such authority.
So on the one hand the FCC’s policy is that it has no authority and the other that it has it all.
Even without the FCC’s inconsistency John Bergmayer, legal director at consumer-advocacy group Public Knowledge said that “201 is concerned with common carriers, not information services. Of course the 1996 Amendments are part of the [Communications] Act. But 201(a) and (b) are both directly addressed to the duties of common carriers".
Writing in his bog he said that "the general grant of rulemaking authority at the end of Section 201(b) contains no reference to common carriers; it simply empowers the Commission to make rules that are 'necessary in the public interest to carry out the provisions of this Act,' without qualification".
In short, the FCC in bending over itself to ensure that Trump is reported is undoing its own arguments for Net Neutrality. Whoops.