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1 II Federal Register / Vol. 68, No. 49 / Thursday, March 13, 2003

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2 III

Contents Federal Register Vol. 68, No. 49

Thursday, March 13, 2003

Agricultural Marketing Service Defense Department PROPOSED RULES RULES Pork promotion, research, and consumer information order, Civilian health and medical program of uniformed services 11996–11998 (CHAMPUS): NOTICES TRICARE program— Agency information collection activities; proposals, Appeals and hearings procedures; formal review, submissions, and approvals, 12026–12027 11973–11974

Agriculture Department Drug Enforcement Administration See Agricultural Marketing Service NOTICES See Animal and Plant Health Inspection Service Applications, hearings, determinations, etc.: See Economic Research Service Chattem Chemicals, Inc., 12103 See Food and Nutrition Service Clement, Richard J., M.D., 12103–12104 See Forest Service Penick Corp., 12104 See National Agricultural Statistics Service Sigma Aldrich Research Biochemicals, Inc., 12104–12105 See Rural Business-Cooperative Service Wooldridge, Douglas W., M.D., 12105 See Rural Housing Service Economic Research Service Animal and Plant Health Inspection Service NOTICES RULES Agency information collection activities; proposals, Hawaiian and territorial quarantine notices: submissions, and approvals, 12027–12028 Gardenia blooms from Hawaii; interstate movement Correction, 11967 Education Department PROPOSED RULES NOTICES Exportation and importation of animals and animal Agency information collection activities; proposals, products: submissions, and approvals, 12043 Classical swine fever; disease status change— Meetings: East Anglia, 11998–11999 Brown v. Board of Education 50th Anniversary Commission, 12043–12044 Bonneville Power Administration Energy Department NOTICES See Bonneville Power Administration Reports and guidance documents; availability, etc.: See Federal Energy Regulatory Commission 2002 wholesale power rates; safety-net cost recovery NOTICES adjustment clause, 12048–12055 Environmental statements; notice of intent: West Valley Demonstration Project and Western New Census Bureau York Nuclear Service Center, NY; decommissioning NOTICES and/or long-term stewardship, 12044–12048 Agency information collection activities; proposals, submissions, and approvals, 12034–12035 Environmental Protection Agency RULES Commerce Department Air programs; approval and promulgation; State plans for See Census Bureau designated facilities and pollutants: See Foreign-Trade Zones Board New York, 11978–11981 See International Trade Administration Air quality implementation plans; approval and See National Oceanic and Atmospheric Administration promulgation; various States: See Patent and Trademark Office Florida, 11977–11978 NOTICES Hazardous waste program authorizations: Agency information collection activities; proposals, Virginia, 11981–11986 submissions, and approvals, 12033–12034 Water pollution; effluent guidelines for point source categories: Commodity Futures Trading Commission Pharmaceutical manufacturing, 12265–12275 PROPOSED RULES PROPOSED RULES Commodity pool operators and commodity trading Air programs; approval and promulgation; State plans for advisors: designated facilities and pollutants: Commodity trading advisors; performance data and New York, 12015 disclosure, 12001–12011 Air quality implementation plans: Preparation, adoption, and submittal— Customs Service Prevention of significant deterioration and PROPOSED RULES nonattainment new source review; routine North American Free Trade Agreement (NAFTA): maintenance, repair, and replacement; hearings, Disassembly operations; tariff treatment, 12011–12013 12014–12015

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Endangered and threatened species; pesticide regulation, Applications, hearings, determinations, etc.: 12013–12014 American Electric Power Service Corp., 12055 Hazardous waste program authorizations: ANR Pipeline Co., 12055–12057 Virginia, 12015 El Paso Natural Gas Co., 12057 Water pollution; effluent guidelines for point source Great Lakes Gas Transmission L.P., 12058 categories: Honeoye Storage Corp., 12058 Pharmaceutical manufacturing, 12275–12278 Kern River Gas Transmission Co., 12058–12059 NOTICES Natural Gas Pipeline Co. of America; correction, 12059 Agency information collection activities; proposals, New York State Electric & Gas Corp., 12059 submissions, and approvals, 12069–12071 PacifiCorp, 12059 Grants and cooperative agreements; availability, etc.: PG&E Transmission, Northwest Corp., 12060 Air and Radiation Office Environmental Internship Questar Pipeline Co., 12060 Program, 12071–12073 Southern Natural Gas Co., 12060–12061 Pesticides; experimental use permits, etc.: Tennessee Gas Pipeline Co., 12061 Mycogen Seeds/Dow Agrosciences LLC et al., 12073– Viking Gas Transmission Co., 12061–12062 12076 Federal Trade Commission Executive Office of the President NOTICES See Presidential Documents Premerger notification waiting periods; early terminations, See Trade Representative, Office of United States 12076–12079 Prohibited trade practices: Export-Import Bank Bristol-Myers Squibb Co., 12080–12087 NOTICES Meetings: Financial Management Service Advisory Committee, 12076 See Fiscal Service Federal Aviation Administration Fiscal Service RULES NOTICES Airworthiness directives: Privacy Act: Bell, 11967–11971 Systems of records; correction, 12155 Pratt & Whitney, 11971–11973 Surety companies acceptable on Federal bonds: PROPOSED RULES American Road Insurance Co., 12152 Airworthiness directives: Gerling Global Reinsurance Corp. of America, 12152 Titeflex Corp., 11999–12001 Markel Insurance Co., 12152–12153 Star Insurance Co., 12153 Federal Communications Commission U.S. Specialty Insurance Co., 12153 RULES Common carrier services: Fish and Wildlife Service Satellite communications— NOTICES Advanced wireless service, 11986–11993 Endangered and threatened species permit applications, Radio stations; table of assignments: 12098 Montana, 11993 Oklahoma, 11993–11994 Food and Drug Administration PROPOSED RULES PROPOSED RULES Common carrier services: Food for human consumption: Federal-State Joint Board on Universal Service— Current good manufacturing practice— Universal services; definition, 12020–12023 Dietary supplements and dietary supplement Radio frequency devices: ingredients, 12157–12263 Advanced wireless service, 12015–12020 NOTICES Radio stations; table of assignments: Food additive petitions: California, 12023–12024 Ion Beam Applications, 12087–12088 Tennessee, 12024 Reports and guidance documents; availability, etc.: Texas, 12024–12025 Dose-counting mechanisms integration into metered-dose inhaler drug products, 12088 Federal Election Commission NOTICES Food and Nutrition Service Meetings; Sunshine Act, 12076 NOTICES Child nutrition programs: Federal Energy Regulatory Commission National School Lunch, Commodity School, School NOTICES Breakfast, Special Milk, Child and Adult Care, and Electric rate and corporate regulation filings: Summer Food Service Programs— Entergy Mississippi, Inc., et al., 12062–12063 Income eligibility guidelines, 12028–12031 Entergy Services, Inc., et al., 12063–12064 Illinois Power Co. et al., 12064–12065 Foreign-Trade Zones Board Hydroelectric applications, 12065–12068 NOTICES Practice and procedure: Applications, hearings, determinations, etc.: Off-the-record communications, 12068–12069 Arizona Preliminary permits surrender: American Italian Pasta Co.; dry pasta products Ketchikan Public Utilities, 12069 warehousing/distribution facility, 12035

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Ohio, 12035–12036 Mississippi River Commission NOTICES Forest Service Meetings; Sunshine Act, 12106–12107 PROPOSED RULES National Forest System land and resource management National Agricultural Statistics Service planning NOTICES Correction, 12155 Agency information collection activities; proposals, submissions, and approvals, 12031–12032 Health and Human Services Department See Food and Drug Administration National Institutes of Health See Health Resources and Services Administration NOTICES See National Institutes of Health Meetings: National Eye Institute, 12089 Health Resources and Services Administration National Heart, Lung, and Blood Institute, 12089–12090 NOTICES National Institute of Allergy and Infectious Diseases, Meetings: 12093–12094 Graduate Medical Education Council, 12088–12089 National Institute of Arthritis and Musculoskeletal and Nurse Education and Practice National Advisory Council, Skin Diseases, 12090–12091 12089 National Institute of Child Health and Human Development, 12093 Indian Affairs Bureau National Institute of Diabetes and Digestive and Kidney NOTICES Diseases, 12092 Liquor and tobacco sale or distribution ordinance: National Institute of Environmental Health Sciences, Confederated Tribes of Coos, Lower Umpqua and Siuslaw 12091–12092 Indians, OR, 12098–12100 National Institute of Mental Health, 12092–12093 National Institute of Neurological Disorders and Stroke, Interior Department 12092 See Fish and Wildlife Service National Library of Medicine, 12094–12095 See Indian Affairs Bureau Scientific Review Center, 12095–12098 See Land Management Bureau National Oceanic and Atmospheric Administration International Trade Administration RULES NOTICES Fishery conservation and management: Antidumping: Alaska; fisheries of Exclusive Economic Zone— Bulk aspirin from— Pollock, 11994–11995 China, 12036–12037 NOTICES Silicon metal from— Agency information collection activities; proposals, Russian Federation, 12037–12039 submissions, and approvals, 12041–12042 Stainless steel sheet and strip in coils from— Permits: Korea, 12039–12041 Marine mammals, 12042

International Trade Commission National Science Foundation NOTICES NOTICES Meetings; Sunshine Act, 12102–12103 Agency information collection activities; proposals, submissions, and approvals, 12107–12108 Justice Department See Drug Enforcement Administration Office of United States Trade Representative NOTICES See Trade Representative, Office of United States Agency information collection activities; proposals, submissions, and approvals, 12103 Patent and Trademark Office NOTICES Labor Department Agency information collection activities; proposals, NOTICES submissions, and approvals, 12042–12043 Agency information collection activities; proposals, submissions, and approvals, 12106 Presidential Documents ADMINISTRATIVE ORDERS Land Management Bureau Government agencies and employees: NOTICES Office of Personnel Management; designation of officers Environmental statements; notice of intent: to act as Director (Memorandum of March 11, 2003), Jonah Infill Drilling Project, WY, 12100–12101 12279–12282 Seminoe Road Coalbed Methane Natural Gas Development Project, WY, 12101–12102 Public Debt Bureau See Fiscal Service Library of Congress RULES Rural Business-Cooperative Service National Film Preservation Board; 1994-2002 film NOTICES selections for inclusion in National Film Registry, Loan guarantee authority; maximum portion available (2003 11974–11977 FY), 12032

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Rural Housing Service See Fiscal Service NOTICES PROPOSED RULES Agency information collection activities; proposals, Currency and foreign transactions; financial reporting and submissions, and approvals, 12032–12033 recordkeeping requirements: USA PATRIOT Act; implementation— Saint Lawrence Seaway Development Corporation Anti-money laundering programs for dealers in RULES precious metals, stones, or jewels; correction, Seaway regulations and rules: 12155 Automatic Identification System transponder NOTICES Correction, 11974 Meetings: Customs Service Commercial Operations Treasury Securities and Exchange Commission Advisory Committee, 12151–12152 NOTICES Agency information collection activities; proposals, Veterans Affairs Department submissions, and approvals, 12108–12109 RULES Self-regulatory organizations; proposed rule changes: Medical benefits: American Stock Exchange LLC, 12109–12113 Non-VA physicians— Chicago Stock Exchange, Inc., 12113–12115 Allowance for drug prescriptions to be filled by non- International Securities Exchange, LLC, 12115–12116 VA pharmacies in State homes under VA contracts, National Association of Securities Dealers, Inc., 12116– 11977 12121 NOTICES New York Stock Exchange, Inc., 12121–12131 Meetings: Pacific Exchange, Inc., 12131–12138 Prosthetics and Special-Disabilities Programs Advisory Philadelphia Stock Exchange, Inc., 12138–12140 Committee, 12153–12154 Reports and guidance documents; availability, etc.: State Department Alternative fuel vehicle program, 12154 NOTICES Grants and cooperative agreements; availability, etc.: Central and Eastern European Professional Exchanges and Separate Parts In This Issue Training Program, 12140–12146 Fullbright Teacher and Administrator Exchange Program, Part II 12146–12149 Health and Human Services Department, Food and Drug Meetings: Administration, 12157–12263 International Telecommunication Advisory Committee, 12149 Part III Environmental Protection Agency, 12265–12278 Statistical Reporting Service See National Agricultural Statistics Service Part IV Trade Representative, Office of United States Executive Office of the President, Presidential Documents, 12279–12282 NOTICES Trade Policy Staff Committee: U.S.-Australia Free Trade Agreement; environmental review, 12149–12150 Reader Aids U.S.-Southern Africa Customs Union Free Trade Consult the Reader Aids section at the end of this issue for Agreement; environmental review, 12150–12151 phone numbers, online resources, finding aids, reminders, and notice of recently enacted public laws. Transportation Department See Federal Aviation Administration To subscribe to the Federal Register Table of Contents See Saint Lawrence Seaway Development Corporation LISTSERV electronic mailing list, go to http:// listserv.access.gpo.gov and select Online mailing list Treasury Department archives, FEDREGTOC-L, Join or leave the list (or change See Customs Service settings); then follow the instructions.

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CFR PARTS AFFECTED IN THIS ISSUE

A cumulative list of the parts affected this month can be found in the Reader Aids section at the end of this issue.

3 CFR Administrative Orders: Memorandums: Memorandum of March 11, 2003 ...... 12281 7 CFR 318...... 11967 Proposed Rules: 1230...... 11996 9 CFR Proposed Rules: 94...... 11998 14 CFR 39 (2 documents) ...... 11967, 11971 Proposed Rules: 39...... 11999 17 CFR Proposed Rules: 4...... 12001 19 CFR Proposed Rules: 181...... 12011 21 CFR Proposed Rules: 111...... 12158 112...... 12158 31 CFR Proposed Rules: 103...... 12155 32 CFR 199...... 11973 33 CFR 401...... 11974 36 CFR 704...... 11974 Proposed Rules: 219...... 12155 38 CFR 17...... 11977 40 CFR 52...... 11977 62...... 11978 271...... 11981 439...... 12266 Proposed Rules: Ch. 1 ...... 12013 51...... 12014 52...... 12014 62...... 12015 271...... 12015 439...... 12776 47 CFR 2...... 11986 25...... 11986 73 (2 documents) ...... 11993 Proposed Rules: 15...... 12015 54...... 12020 73 (3 documents) ...... 12023, 12024 50 CFR 679 (2 documents) ...... 11994

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Rules and Regulations Federal Register Vol. 68, No. 49

Thursday, March 13, 2003

This section of the FEDERAL REGISTER of the final rule by replacing Coccus DEPARTMENT OF TRANSPORTATION contains regulatory documents having general viridus with Coccus viridis. applicability and legal effect, most of which Federal Aviation Administration are keyed to and codified in the Code of Under the rule, gardenia growers in Hawaii who wish to move cut blooms of Federal Regulations, which is published under 14 CFR Part 39 50 titles pursuant to 44 U.S.C. 1510. gardenia interstate from Hawaii would be able to do so if the gardenias were [Docket No. 2001–SW–53–AD; Amendment The Code of Federal Regulations is sold by produced in a growing area determined 39–13079; AD 2003–05–03] the Superintendent of Documents. Prices of new books are listed in the first FEDERAL by an inspector to be free of green scale RIN 2120–AA64 REGISTER issue of each week. and to meet other requirements, including the establishment of a buffer Airworthiness Directives; Bell area around the gardenia production Helicopter Textron Canada Model 407 DEPARTMENT OF AGRICULTURE area. This buffer area must be Helicopters determined free of all green scale host AGENCY: Federal Aviation Animal and Plant Health Inspection plants listed in § 318.13–4j(b). Administration, DOT. Service Ginger (Alpinia purpurata) and ACTION: Final rule. 7 CFR Part 318 Pluchea indica (a weed introduced into Hawaii) are known green scale host SUMMARY: This amendment adopts a [Docket No. 01–042–3] plants and, consequently, are prohibited new airworthiness directive (AD) for the in the buffer area. In the rule portion of specified Bell Helicopter Textron Interstate Movement of Gardenia From the final rule, we incorrectly identified Canada (Bell) model helicopters that Hawaii ginger as ‘‘Alpinia purpurata’’ and requires preflight checking and repetitively inspecting for a crack in AGENCY: Animal and Plant Health Pluchea indica as ‘‘Pluto indicia.’’ Inspection Service, USDA. Therefore, in order for the regulations to certain tailbooms that have not been redesigned and replacing the tailboom if ACTION: accurately identify these specific hosts, Final rule; correction. a crack is found; modifying and re- we are correcting § 318.13–4j(b) in the identifying certain tailbooms and SUMMARY: In final rule published in the final rule by replacing Alpina purpurata Federal Register on February 5, 2003, installing an improved horizontal with Alpinia purpurata and Pluto stabilizer assembly; and assigning a we amended the Hawaiian fruits and indicia with Pluchea indica. vegetables regulations to provide for the 5,000 hour time-in-service (TIS) life movement of cut blooms of gardenia § 318.13–4; [Corrected] limit. This amendment is prompted by from Hawaii. The final rule contained cracking discovered in other areas of errors in the SUPPLEMENTARY In FR Doc. 03–2683, published on certain tailbooms and introduction of a INFORMATION section and in the rule February 5, 2003 (68 FR 5800–5802), redesigned tailboom with a chemically portion. This document corrects those make the following corrections: milled skin, which does not require the errors. 1. On page 5801, in the first column, current inspections. The actions specified by this AD are intended to in line 31, correct ‘‘(Coccus viridus)’’ to EFFECTIVE DATE: March 7, 2003. prevent separation of the tailboom and read ‘‘(Coccus viridis)’’. FOR FURTHER INFORMATION CONTACT: Ms. subsequent loss of control of the Susan G. Dublinski, Import/Export 2. On page 5802, in the third column, helicopter. Specialist, Phytosanitary Issues in § 318.13–4j, paragraph (b), correct DATES: Effective April 17, 2003. Management, PPQ, APHIS, 4700 River ‘‘(Alpina purpurata)’’ to read ‘‘(Alpinia The incorporation by reference of Road Unit 140, Riverdale, MD 20737– purpurata)’’ and correct ‘‘Pluto indicia’’ 1236; (301) 734–4312. certain publications listed in the to read ‘‘Pluchea indica’’. regulations is approved by the Director SUPPLEMENTARY INFORMATION: In a final Done in Washington, DC, this 7th day of of the Federal Register as of April 17, rule published in the Federal Register March, 2003. 2003. on February 5, 2003 (68 FR 5800–5802, Docket No. 01–042–2), we amended the Kevin Shea, ADDRESSES: The service information Hawaiian fruits and vegetables Acting Administrator, Animal and Plant referenced in this AD may be obtained regulations in 7 CFR part 318 to provide Health Inspection Service. from Bell Helicopter Textron Canada, for the interstate movement of cut [FR Doc. 03–6058 Filed 3–12–03; 8:45 am] 12,800 Rue de l’Avenir, Mirabel, Quebec blooms of gardenia from Hawaii under BILLING CODE 3410–34–P J7J1R4, telephone (450) 437–2862 or certain conditions. The movement of cut (800) 363–8023, fax (450) 433–0272. blooms of gardenia had been prohibited This information may be examined at due to gardenia’s status as a host of the FAA, Office of the Regional Counsel, green scale (Coccus viridis), also known Southwest Region, 2601 Meacham as green coffee scale, a destructive plant Blvd., Room 663, Fort Worth, Texas; or pest. In the Supplementary Information at the Office of the Federal Register, 800 section of the final rule, we incorrectly North Capitol Street, NW., suite 700, identified green scale as Coccus viridus. Washington, DC. Therefore, we are correcting the error in FOR FURTHER INFORMATION CONTACT: the SUPPLEMENTARY INFORMATION section Sharon Miles, Aviation Safety Engineer,

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FAA, Rotorcraft Directorate, Regulations inspections for the tailbooms, P/N 407– inspections, and 18 work hours per Group, Fort Worth, Texas 76193–0111, 030–801–101 and –105, until they are helicopter to accomplish the telephone (817) 222–5122, fax (817) modified and re-identified. Once modification, and that the average labor 222–5961. modified and re-identified as P/N 407– rate is $60 per work hour. Required SUPPLEMENTARY INFORMATION: On March 530–014–101 and –103, respectively, parts will cost approximately $1,244 per 21, 2000, the FAA issued AD 2000–06– the FAA proposed to mandate the 150- helicopter. Based on these figures, the 10, Amendment 39–11651 (65 FR hour TIS inspection and assign a 5,000- total cost impact of the AD on U.S. 16804, March 30, 2000), to require hour TIS life limit. The 150-hour TIS operators is estimated to be $3,254 per preflight checking and repetitively inspection and 5,000 hour life limit also helicopter, or $924,136, assuming all inspecting the tailboom for a crack and applies to the tailboom, P/N 407–030– U.S. registered helicopters are required replacing the tailboom if a crack is 801–107. Additionally, the cite to to be modified and initially inspected, tailboom, P/N 407–030–801–201, as a found. That action was prompted by and have 8 repetitive inspections per terminating action was removed since four reports of cracks on the tailboom in year. In its service information, under the installation of other redesigned the area of the horizontal stabilizer. The certain conditions, the manufacturer requirements of that AD were intended tailbooms may also effectively remove a helicopter from the applicability of this offers a ‘‘special’’ warranty for parts to prevent separation of the tailboom needed for modifying tailbooms, P/N and subsequent loss of control of the proposal, thereby constituting a terminating action for the requirements 407–030–801–101 and –105, and a labor helicopter. Next, a proposal to amend 14 allowance of $480. CFR part 39 to include an AD for Bell of this AD. Interested persons have been afforded Model 407 helicopters was published in The regulations adopted herein will an opportunity to participate in the the Federal Register on January 31, not have a substantial direct effect on making of this amendment. Due 2002 (67 FR 4685). That NPRM would the States, on the relationship between consideration has been given to the have required preflight checking and the national Government and the States, comments received. or on the distribution of power and repetitively inspecting for a crack in Two commenters state that the certain tailbooms that have not been responsibilities among the various instructions need to be clear regarding levels of government. Therefore, it is redesigned and replacing the tailboom if the assignment of the life limit. The determined that this final rule does not a crack is found. It further proposed that FAA agrees and has changed paragraph have federalism implications under installing tailboom, P/N 407–030–801– (d) of the AD to clarify the tailboom life 201, would constitute terminating limit. For the modified tailbooms, P/N Executive Order 13132. action for the requirements of that AD. 407–530–014–101 and P/N 407–530– For the reasons discussed above, I Since the issuance of that NPRM on 014–103, 5,000 hours TIS since certify that this action (1) is not a January 31, 2002 (67 FR 4685), the modified and installed is the life limit. ‘‘significant regulatory action’’ under manufacturer has issued Bell Helicopter The life limit for tailboom, P/N 407– Executive Order 12866; (2) is not a Textron Alert Service Bulletin (ASB) 030–801–107, is 5,000 hours since new ‘‘significant rule’’ under DOT No. 407–99–26, Revision C, dated (initially installed on any helicopter). Regulatory Policies and Procedures (44 February 28, 2002, that addresses One commenter states that the FR 11034, February 26, 1979); and (3) inspection procedures for certain proposed compliance date may be too will not have a significant economic tailbooms. The manufacturer also issued short. Additionally, the commenter impact, positive or negative, on a Bell Helicopter Textron ASB No. 407– points out an incorrect reference in the substantial number of small entities 01–48, Revision B, dated April 25, 2002, preamble discussion to the part number that details the modification and re- under the criteria of the Regulatory tailboom cited for use as a terminating Flexibility Act. A final evaluation has identification of those certain tailbooms, action. The FAA agrees; P/N 407–030– been prepared for this action and it is assigns a life limit, and details new 801–101 cited in the discussion should contained in the Rules Docket. A copy inspection procedures for those re- have been P/N 407–030–801–201. Also, of it may be obtained from the Rules identified tailbooms. Additionally, ASB the FAA agrees that the compliance 407–01–48 assigns a life limit and time was too short. Because the Docket at the location provided under details new inspection procedures for compliance time cited in the proposal the caption ADDRESSES. another part-numbered tailboom that was ‘‘January 31, 2003’’ and that date List of Subjects in 14 CFR Part 39 was modified by the manufacturer. has passed, the required compliance Further, in addition to the redesigned time for paragraph (c) of the AD is Air transportation, Aircraft, Aviation tailboom, P/N 407–030–801–201, changed to ‘‘within 30 days.’’ safety, Incorporation by reference, referenced in the NPRM, Bell has at After careful review of the available Safety. least one additional redesigned data, including the comments noted tailboom, P/N 407–030–801–203, for above, the FAA has determined that air Adoption of the Amendment these helicopters. Transport Canada, safety and the public interest require the Accordingly, pursuant to the which is the airworthiness authority for adoption of the rule with the changes Canada, has issued a revised AD No. described previously. The FAA has authority delegated to me by the CF–1999–17R2, dated April 5, 2002, to determined that these changes will Administrator, the Federal Aviation address these changed requirements. neither increase the economic burden Administration amends part 39 of the After reviewing comments received in on any operator nor increase the scope Federal Aviation Regulations (14 CFR response to that proposal as well as of the AD. part 39) as follows: updated service information from the The FAA estimates that 284 manufacturer, on November 14, 2002 helicopters of U.S. registry will be PART 39—AIRWORTHINESS (67 FR 68952), the FAA published a affected by this AD, that it will take DIRECTIVES supplemental notice in the Federal approximately 3.5 work hours per Register to propose mandating daily helicopter to accomplish the initial 1. The authority citation for part 39 pre-flight checks and initial 25-hour TIS inspections, 1.5 work hours per continues to read as follows: inspections with recurring 50 hour TIS helicopter to accomplish the recurring Authority: 49 U.S.C. 106(g), 40113, 44701.

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§ 39.13 [Amended] 101, –105 or–107, or P/N 407–530–014–101 owner/operator must request approval for an or –103, (re-identified in accordance with alternative method of compliance in 2. Section 39.13 is amended by Bell Helicopter Textron (Bell) Alert Service accordance with paragraph (h) of this AD. adding a new airworthiness directive to Bulletin (ASB) 407–01–48, Revision B, dated The request should include an assessment of read as follows: April 25, 2002), installed, certificated in any the effect of the modification, alteration, or category. 2003–05–03 Bell Helicopter Textron repair on the unsafe condition addressed by Note 1: This AD applies to each helicopter Canada: Amendment 39–13079. Docket this AD; and if the unsafe condition has not identified in the preceding applicability been eliminated, the request should include No. 2001–SW–53–AD. Supersedes AD provision, regardless of whether it has been specific proposed actions to address it. 2000–06–10, Docket No. 99–SW–75–AD, otherwise modified, altered, or repaired in Amendment 39–11651. the area subject to the requirements of this Compliance: Required as indicated. Applicability: Model 407 helicopters, serial AD. For helicopters that have been modified, To prevent separation of the tailboom and numbers 53000 through 53475, with altered, or repaired so that the performance subsequent loss of control of the helicopter, tailboom, part number (P/N) 407–030–801– of the requirements of this AD is affected, the accomplish the following:

Applicable tailboom Compliance time Actions In accordance with

(a) Tailboom, P/N 407–030–801– Before the first flight of each day Visually check the tailboom for Figure 1 of this AD. 101 and –105, that have not cracks. An owner/operator been modified in accordance (pilot) holding at least a private with Bell ASB 407–01–048, Re- pilot certificate may perform the vision B, dated April 25, 2002. visual check required by this paragraph, but must enter com- pliance with this paragraph into the helicopter records in ac- cordance with 14 CFR 43.11 and 91.417(a)(2)(v). (b) Tailboom, P/N 407–030–801– Within 25 hours time-in-service Visually inspect the tailboom for Part II of the Accomplishment In- 101 and –105, that have 600 or (TIS), and thereafter at intervals cracks using a 10x or higher structions of Bell ASB 407–99– more hours TIS and have not not to exceed 50 hours TIS. magnifying glass. 26, Revision C, dated February been modified in accordance 28, 2002, except contacting Bell with Bell ASB 407–01–48, Revi- is not required. sion B, dated April 25, 2002. (c) Tailboom, P/N 407–030–801– Within 600 hours TIS, but not Modify and re-identify tailbooms Parts I and III of the Accomplish- 101 and –105. later than 30 days, unless pre- as P/N 407–530–014–101 and ment Instructions in Bell ASB viously accomplished. –103, respectively, and install 407–01–48, Revision B, dated improved horizontal stabilizer April 25, 2002, and Bell Tech- assembly, P/N 407–023–800– nical Bulletin No. 407–01–33, ALL. dated August 29, 2001, except contacting Bell is not required. (d) Tailboom, P/N 407–530–014– Before further flight after the Create a historical service record Part IV of the Accomplishment In- 101 and –103; and P/N 407– tailboom is modified and re- sheet and assign a life limit of structions in Bell ASB 407–01– 030–801–107. identified, unless previously ac- 5,000 hours TIS since modifica- 48, Revision B, dated April 25, complished. tion, re-identification, and instal- 2002. lation of tailboom, P/N 407– 530–014–101 or –103, on any helicopter, or initial installation of P/N 407–030–801–107 on any helicopter. (e) Tailboom, P/N 407–530–014– Within 150 hours TIS after modi- Inspect the tailboom for a crack ... Parts IV and V of the Accomplish- 101 and 103; and P/N 407–030– fication, or within 150 hours TIS ment Instructions in Bell ASB 801–107. since new, and thereafter at in- 407–01–48, Revision B, dated tervals not to exceed 150 hours April 25, 2002. TIS. (f) All applicable part-numbered Before further flight ...... If a crack is found, replace the The applicable maintenance tailbooms. tailboom. manual.

BILLING CODE 4910–13–P

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BILLING CODE 4910–13–C used if approved by the Manager, Regulations (i) Special flight permits may be issued in (g) This AD revises the helicopter Group, Rotorcraft Directorate, FAA. accordance with §§ 21.197 and 21.199 of the Airworthiness Limitations section of the Operators shall submit their requests through Federal Aviation Regulations (14 CFR 21.197 maintenance manual by establishing a new an FAA Principal Maintenance Inspector, and 21.199) to operate the helicopter to a retirement life for the tailboom, P/N 407– who may concur or comment and then send location where the requirements of this AD 530–014–101 and –103, and P/N 407–030– it to the Manager, Regulations Group. can be accomplished. 801–107 of 5,000 hours TIS. Note 2: Information concerning the (j) The inspections shall be done in (h) An alternative method of compliance or existence of approved alternative methods of accordance with Part II of the adjustment of the compliance time that compliance with this AD, if any, may be Accomplishment Instructions in Bell provides an acceptable level of safety may be obtained from the Regulations Group. Helicopter Textron Alert Service Bulletin No.

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407–99–26, Revision C, dated February 28, incorporation of a new tierod retention Compliance With Referenced Service 2002. The modifications and re- configuration. This amendment is Bulletins identifications shall be accomplished in prompted by two reports of uncontained One commenter states that accordance with Bell Helicopter Textron failure of JT8D turbofan engines, caused Technical Bulletin No. 407–01–33, dated compliance with PW SBs 5408, 5719, August 29, 2001, and Parts I and III of the by turbine rotor overspeed resulting and 5734 should be considered direct Accomplishment Instructions in Bell from first and second stage fan section compliance to the proposed rule in Helicopter Textron Alert Service Bulletin separation from the low pressure place of PW SB 6429, dated August 23, 407–01–48, Revision B, dated April 25, 2002. compressor (LPC). The actions specified 2002. The commenter believes that The creation of historical service record by this AD are intended to prevent first these three service bulletins offer an sheets and inspections shall be done in and second stage fan section separation equivalent level of safety to that of PW accordance with Parts IV and V of the from the LPC, resulting in turbine rotor Accomplishment Instructions in Bell SB 6429. Further, the commenter is overspeed, uncontained engine failure, concerned that the new PW SB 6429 Helicopter ASB 407–01–48, Revision B, and damage to the airplane. dated April 25, 2002. These incorporations may introduce new failure modes. by reference were approved by the Director DATES: Effective April 17, 2003. The The FAA does not agree. The of the Federal Register in accordance with 5 incorporation by reference of certain proposed rule is worded such that the U.S.C. 552(a) and 1 CFR part 51. Copies may publications listed in the regulations is intents of SBs 5409, 5719, and 5734 are be obtained from Bell Helicopter Textron approved by the Director of the Federal contained in paragraph (a) of the final Canada, 12,800 Rue de l’Avenir, Mirabel, Register as of April 17, 2003. rule. This wording was chosen at the Quebec J7J1R4, telephone (450) 437–2862 or request of the Air Transport Association (800) 363–8023, fax (450) 433–0272. Copies ADDRESSES: The service information may be inspected at the FAA, Office of the referenced in this AD may be obtained (ATA) to facilitate easier compliance by Regional Counsel, Southwest Region, 2601 from Pratt & Whitney, 400 Main St., East operators. However, while the Meacham Blvd., Room 663, Fort Worth, Hartford, CT 06108; telephone (860) modifications identified by these Texas; or at the Office of the Federal Register, 565–8770; fax (860) 565–4503. This bulletins reduce the probability of 800 North Capitol Street, NW., suite 700, information may be examined, by encountering a tierod fracture and some Washington, DC. appointment, at the Federal Aviation operators may not have experienced one (k) This amendment becomes effective on since incorporating the bulletins, they April 17, 2003. Administration (FAA), New England Region, Office of the Regional Counsel, do not prevent the fractures completely. Note 3: The subject of this AD is addressed 12 New England Executive Park, The FAA has received reports from PW in Transport Canada (Canada) AD No. CF– of tierod fractures occurring after 1999–17R2, dated April 5, 2002. Burlington, MA; or at the Office of the Federal Register, 800 North Capitol incorporating SBs 5409, 5719, and 5734. Issued in Fort Worth, Texas, on March 3, Street, NW., suite 700, Washington, DC. Accordingly, PW has issued SB JT8D 2003. 6429, dated August 23, 2002, which FOR FURTHER INFORMATION CONTACT: David A. Downey, adds a tierod retention feature to Christopher Spinney, Aerospace prevent the escape of the fractured end Manager, Rotorcraft Directorate, Aircraft Engineer, Engine Certification Office, Certification Service. of the tierod which can lead to FAA, Engine and Propeller Directorate, separation of the first and second stage [FR Doc. 03–5576 Filed 3–12–03; 8:45 am] 12 New England Executive Park, BILLING CODE 4910–13–P fan sections from the rear stages of the Burlington, MA 01803–5299; telephone LPC and a subsequent uncontained (781) 238–7175; fax (781) 238–7199. engine failure. Further, the new design DEPARTMENT OF TRANSPORTATION SUPPLEMENTARY INFORMATION: A features in question have been used on proposal to amend part 39 of the Federal other engines with similar tierod Federal Aviation Administration Aviation Regulations (14 CFR part 39) to configurations. The new tierods meet all include an AD that is applicable to PW of the airworthiness standards required 14 CFR Part 39 JT8D–1, –1A, –1B, –7, –7A, –7B, –9, for certification. Proven design –9A, –11, –15, –15A, –17, –17A, –17R, [Docket No. 2002–NE–27–AD; Amendment standards used for the new retention 39–13083; AD 2003–05–07] and –17AR turbofan engines was feature have demonstrated to the FAA published in the Federal Register on that no new failure modes will be RIN 2120–AA64 November 15, 2002, (67 FR 69152). That introduced into the field. action proposed to require removal from Airworthiness Directives; Pratt & service of certain P/N 3rd–4th and 4th– Lack of Enforcement of Acceptable Whitney JT8D–1, –1A, –1B, –7, –7A, 5th stage compressor rotor spacer Maintenance Practices and Financial –7B, –9, –9A, –11, –15, –15A, –17, assemblies and incorporation of a new Burden –17A, –17R, and –17AR Turbofan tierod retention configuration in One commenter states that the rule Engines accordance with PW Service Bulletin ignores enforcement of acceptable, AGENCY: Federal Aviation (SB) No. JT8D 6429, dated August 23, pertinent maintenance practices and Administration, DOT. 2002. adds monetary burden to all operators, without regard to disciplined adherence ACTION: Final rule. Comments to PW’s or operator’s approved SUMMARY: This amendment adopts a Interested persons have been afforded maintenance program. new airworthiness directive (AD), that is an opportunity to participate in the The FAA does not agree. The FAA has applicable to Pratt & Whitney (PW) making of this amendment. Due identified an unsafe condition that JT8D–1, –1A, –1B, –7, –7A, –7B, –9, consideration has been given to the exists on a type certified product. The –9A, –11, –15, –15A, –17, –17A, –17R, comments received. actions identified to correct that and –17AR turbofan engines. This condition are manufacturer’s Agreement With Proposal as Written amendment requires removal from maintenance recommendations. The service of certain part number (P/N) The National Transportation Safety FAA is required to mandate these 3rd–4th and 4th–5th stage compressor Board and one other commenter agree recommendations in order to correct the rotor spacer assemblies and with the proposal as written. unsafe condition. Operators are still

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afforded the opportunity to develop an Executive Order 12866; (2) is not a overspeed, uncontained engine failure, and alternative plan to correct the unsafe ‘‘significant rule’’ under the DOT damage to the airplane, do the following: condition under the provisions of Regulatory Policies and Procedures (44 (a) At the next accessibility of the LPC, do paragraph (d) of this AD. Many FR 11034, February 26, 1979); and (3) the following: (1) Remove from service 3rd–4th stage operators already incorporate the will not have a significant economic compressor rotor spacer assemblies part requirements in this AD under their impact, positive or negative, on a numbers (P/Ns) 479927, 522194, 583385, approved maintenance program, substantial number of small entities 656814, 656815, 660649, 660655, 716851, therefore their monetary burden should under the criteria of the Regulatory 716853, 716854, 762140, 762145, 762271, be minimal. Flexibility Act. A final evaluation has 762468, 789554, and 789752 and replace been prepared for this action and it is with a serviceable part. Request for Alternate Compliance Time contained in the Rules Docket. A copy (2) Remove from service 4th–5th stage and Eliminate Time Restrictions of it may be obtained by contacting the compressor rotor spacer assemblies P/Ns 479929, 522196, 656816, 656817, 660650, One commenter asks that the AD be Rules Docket at the location provided written to allow AD compliance during 660656, 716855, 762138, and 762142 and under the caption ADDRESSES. replace with a serviceable part. LPC module heavy maintenance, when List of Subjects in 14 CFR Part 39 (3) Remove from service 4th–5th stage at piece-part level, without time compressor rotor spacer assemblies P/N restrictions. Air transportation, Aircraft, Aviation 628778 that do not incorporate service The FAA does not agree. The proposal safety, Incorporation by reference, bulletin (SB) 5409, and replace with a currently requires the compliance at Safety. serviceable part. LPC accessibility which is defined as Note 2: Information on modifying parts removal of the affected parts at the Adoption of the Amendment listed in paragraphs (a)(1), (a)(2), and (a)(3) of piece-part level. No time restrictions are Accordingly, pursuant to the this AD into servicable parts is contained in included in the AD. If there are specific authority delegated to me by the PW SBs No. 5409, SB No. 5716, and SB No. 5734. aspects of an operator’s maintenance Administrator, the Federal Aviation plan that make this definition an Administration amends part 39 of the (4) Incorporate new tierods, retaining rings, unusual burden, the operator should 2nd stage compressor air seal or spacer Federal Aviation Regulations (14 CFR assembly, flat washers and tierod nuts in the propose an alternative incorporation part 39) as follows: LPC in accordance with the Accomplishment plan under the provisions of paragraph Instructions of PW SB JT8D 6429, dated (d) of the AD. PART 39—AIRWORTHINESS August 23, 2002. After careful review of the available DIRECTIVES (b) After the effective date of this AD, do data, including the comments noted not install 3rd–4th or 4th–5th stage 1. The authority citation for part 39 above, the FAA has determined that air compressor rotor spacer assemblies listed in continues to read as follows: safety and the public interest require the paragraphs (a)(1), (a)(2), and (a)(3) of this AD adoption of the rule as proposed. Authority: 49 U.S.C. 106(g), 40113, 44701. into any engine. Economic Analysis § 39.13 [Amended] Definition (c) For the purpose of this AD, accessibility There are approximately 4,180 PW 2. Section 39.13 is amended by means removal of the LPC from the engine JT8D–1, –1A, –1B, –7, –7A, –7B, –9, adding a new airworthiness directive to and disassembly that provides piece-part –9A, –11, –15, –15A, –17, –17A, –17R, read as follows: exposure to the parts listed in paragraph (a) and –17AR turbofan engines of the 2003–05–07 Pratt & Whitney: Amendment of this AD. affected design in the worldwide fleet. 39–13083. Docket No. 2002–NE–27–AD. Alternative Methods of Compliance The FAA estimates that 1,800 engines Applicability: This airworthiness directive installed on aircraft of U.S. registry will (d) An alternative method of compliance or (AD) is applicable to Pratt & Whitney (PW) adjustment of the compliance time that be affected by this AD, that it will take JT8D–1, –1A, –1B, –7, –7A, –7B, –9, –9A, provides an acceptable level of safety may be approximately 41 work hours per engine –11, –15, –15A, –17, –17A, –17R, and –17AR used if approved by the Manager, Engine to perform the required actions, and that turbofan engines. These engines are installed Certification Office (ECO). Operators must the average labor rate is $60 per work on, but not limited to Boeing 727 and 737 submit their request through an appropriate hour. Required parts will cost series, and McDonnell Douglas DC–9 series FAA Principal Maintenance Inspector, who approximately $3,600 per engine. Based airplanes. may add comments and then send it to the on these figures, the total cost of the AD Note 1: This AD applies to each engine Manager, ECO. to U.S. operators is estimated to be identified in the preceding applicability Note 3: Information concerning the provision, regardless of whether it has been $10,908,000. existence of approved alternative methods of modified, altered, or repaired in the area compliance with this airworthiness directive, Regulatory Analysis subject to the requirements of this AD. For if any, may be obtained from the ECO. engines that have been modified, altered, or This final rule does not have repaired so that the performance of the Special Flight Permits federalism implications, as defined in requirements of this AD is affected, the (e) Special flight permits may be issued in Executive Order 13132, because it owner/operator must request approval for an accordance with §§ 21.197 and 21.199 of the would not have a substantial direct alternative method of compliance in Federal Aviation Regulations (14 CFR 21.197 effect on the States, on the relationship accordance with paragraph (d) of this AD. and 21.199) to operate the airplane to a between the national government and The request should include an assessment of location where the requirements of this AD the States, or on the distribution of the effect of the modification, alteration, or can be done. repair on the unsafe condition addressed by power and responsibilities among the this AD; and, if the unsafe condition has not Documents That Have Been Incorporated By various levels of government. been eliminated, the request should include Reference Accordingly, the FAA has not consulted specific proposed actions to address it. (f) The actions must be done in accordance with state authorities prior to Compliance: Compliance with this AD is with Pratt & Whitney Service Bulletin JT8D publication of this final rule. required as indicated, unless already done. 6429, dated August 23, 2002. This For the reasons discussed above, I To prevent first and second stage fan incorporation by reference was approved by certify that this action (1) is not a section separation from the low pressure the Director of the Federal Register in ‘‘significant regulatory action’’ under compressor (LPC), resulting in turbine rotor accordance with 5 U.S.C. 552(a) and 1 CFR

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part 51. Copies may be obtained from Pratt procedures to any party to an initial dissatisfied with the initial or & Whitney, 400 Main St., East Hartford, CT determination or reconsideration reconsideration determination unless 06108; telephone (860) 565–8770; fax (860) determination made by the CHAMPUS the initial or reconsideration 565–4503. Copies may be inspected at the contractor and who may want to request determination is final under paragraph FAA, New England Region, Office of the (b)(5) of this section; involves the Regional Counsel, 12 New England Executive a formal review. Park, Burlington, MA; or at the Office of the Executive Order 12866 requires sanctioning of a provider by the Federal Register, 800 North Capitol Street, certain regulatory assessments for any exclusion, suspension or termination of NW., suite 700, Washington, DC. ‘‘significant regulatory action’’ defined authorized provider status; involves a as one, which would result in an annual written decision issued pursuant to Effective Date effect on the economy of $100 million § 199.9(h)(1)(iv)(A) regarding the (g) This amendment becomes effective on or more, or have other substantial temporary suspension of claims April 17, 2003. impacts. processing; or involves a Issued in Burlington, Massachusetts, on The Regulatory Flexibility Act (RFA) reconsideration determination by a March 4, 2003. requires that each Federal agency CHAMPUS peer review organization. A Jay J. Pardee, prepare, and make available for public hearing, but not a formal review level of Manager, Engine and Propeller Directorate, comment, a regulatory flexibility appeal, may be available to a party to an Aircraft Certification Service. analysis when the agency issues a initial determination involving the [FR Doc. 03–5692 Filed 3–12–03; 8:45 am] regulation which would have a sanctioning of a provider or to a party BILLING CODE 4910–13–P significant impact on a substantial to a written decision involving a number of small entities. temporary suspension of claims This rule has been designated as processing. A beneficiary (or an DEPARTMENT OF DEFENSE significant rule and has been reviewed authorized representative of a by the Office of Management and beneficiary), but not a provider (except Office of the Secretary Budget as required under the provisions as provided in § 199.15), may request a of E.O. 12866. The Department of hearing, but not a formal review, of a 32 CFR Part 199 Defense certifies that this interim final reconsideration determination made by rule would not have a significant impact a CHAMPUS peer review organization. RIN –0720–AA74 on small business entities. (1) Requesting a formal review. (i) Written request required. The request TRICARE; Civilian Health and Medical This interim final rule will not must be in writing, shall state the Program of the Uniformed Services impose additional information collection requirements on the public specific matter in dispute, shall include (CHAMPUS); Appeals and Hearings copies of the written determination Procedures, Formal Review under the Paperwork Reduction Act of 1980 (44 U.S.C. 3501–3511). (notice of reconsideration determination AGENCY: Office of the Secretary, DoD. or OCHAMPUS initial determination) List of Subjects in 32 CFR Part 199 ACTION: Interim Final Rule; being appealed, and shall include any administrative corrections. Claims, Health insurance, Individuals additional information or documents with disabilities, Dental Health, Military not submitted previously. SUMMARY: This document makes personnel. (ii) Where to file. The request shall be submitted to the Chief, Office of administrative corrections to the 32 CFR Accordingly, 32 CFR Part 199 is Appeals and Hearings, TRICARE part 199, section 199.10, ‘‘Appeal and amended as follows: Hearing Procedures.’’ These corrections Management Activity, 16401 East include revising § 199.10, adding PART 199—[AMENDED] Centretech Parkway, Auroa, Colorado paragraphs (c)(1) through (c)(5), and 80011–9066. making other minor editorial changes. 1. The authority citation for Part 199 (iii) Allowed time to file. The request DATES: Forward comments on or before continues to read as follows: shall be mailed within 60 days after the May 12, 2003. Authority: 5 U.S.C. 301; 10 U.S.C. chapter date of the notice of the reconsideration determination or OCHAMPUS initial ADDRESSES: 55. Forward comments to determination being appealed. Medical Benefits and Reimbursement 2. Section 199.10 is amended by (iv) Official filing date. A request for Systems, TRICARE Management revising paragraph (b) introductory text, a formal review shall be deemed filed Activity, 16401 East Centretech and revising paragraph (c) to read as on the date it is mailed and postmarked. Parkway, Aurora, CO 80011–9066. follows: If the request does not have a postmark, FOR FURTHER INFORMATION CONTACT: Gail it shall be deemed filed on the date L. Jones, Medical Benefits and § 199.10 Appeals and Hearings received by OCHAMPUS. Reimbursement Systems, TRICARE Procedures. (2) The formal review process. The Management Activity, telephone (303) * * * * * purpose of the formal review is to 676–3401. (b) Reconsideration. Any party to the determine whether the initial SUPPLEMENTARY INFORMATION: initial determination made by the determination or reconsideration Paragraphs (c)(1) through (c)(5) were CHAMPUS contractor, or a CHAMPUS determination was made in accordance inadvertently omitted when the July 1, peer review organization may request with law, regulation, policies, and 1991 edition of the 32 CFR was reconsideration. guidelines in effect at the time the care published. The discovery that the * * * * * was provided or requested or at the time formal review process was missing from (c) Formal review. Except as of the initial determination, § 199.10 occurred at the time that explained in this paragraph, any party reconsideration, or formal review TRICARE was tasked to promulgate an to an initial determination made by decision involving a provider request appeal process for TRICARE Claimcheck OCHAMPUS, or a reconsideration for approval as an authorized denials. determination made by the CHAMPUS CHAMPUS provider. The formal review This correction to § 199.10 is contractor, may request a formal review is performed by the Chief, Office of necessary to provide the required by OCHAMPUS if the party is Appeals and Hearings, OCHAMPUS, or

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a designee, and is a thorough review of DEPARTMENT OF TRANSPORTATION LIBRARY OF CONGRESS the case. The formal review determination shall be based on the Saint Lawrence Seaway Development 36 CFR Part 704 information, upon which the initial Corporation determination and/or reconsideration National Film Preservation Board; determination was based, and any 33 CFR Part 401 1994–2002 Films Selected for Inclusion additional information the appealing in the National Film Registry party may submit or OCHAMPUS may [Docket No. SLSDC 2002–13698] AGENCY: National Film Preservation obtain. Board, Library of Congress. (3) Timeliness of formal review RIN 2135–AA15 ACTION: Final rule. determination. The Chief, Office of SUMMARY: The Librarian of Congress is Appeals and Hearings, OCHAMPUS, or Seaway Regulations and Rules: publishing the following list of films a designee normally shall issue the Automatic Identification System formal review determination no later selected from 1994–2002 for inclusion in the National Film Registry in the than 90 days from the date of receipt of AGENCY: Saint Lawrence Seaway Library of Congress pursuant to section the request for formal review by the Development Corporation, DOT. OCHAMPUS. 103 of the National Film Preservation (4) Notice of formal review ACTION: Final rule; correction. Act of 1996. The films are published to determination. The Chief, Office of notify the public of the Librarian’s Appeals and Hearings, OCHAMPUS, or SUMMARY: In the Saint Lawrence Seaway selection of twenty-five films selected in a designee shall issue a written notice Development Corporation (SLSDC) final each of these years deemed to be of the formal review determination to rule amending the Seaway regulations ‘‘culturally, historically or aesthetically the appealing party at his or her last and rules (33 CFR part 401) published significant’’ in accordance with known address. The notice of the formal in the Federal Register on February 28, Congress’ mandate. These 225 new films review determination must contain the 2003 (68 FR 9549), an inadvertent error join the 125 films already selected for following elements: was made in the heading of the new inclusion in the Registry under section 203 of the 1992 Act, as well as (i) A statement of the issue or issues § 401.20. This document corrects that previously chosen under section 3 of under appeal. error. Pub. L. 100–446. The National Film (ii) The provisions of law, regulation, DATES: Effective on March 25, 2003. Preservation Act of 1988. The policies, and guidelines that apply to Librarian’s goal in administering the Act the issue or issues under appeal. FOR FURTHER INFORMATION CONTACT: is to promote the preservation of all (iii) A discussion of the original and Marc C. Owen, Chief Counsel, Saint genres of film, represented by the additional information that is relevant Lawrence Seaway Development diverse list of films selected for to the issue or issues under appeal. Corporation, 400 Seventh Street, SW., inclusion in the Registry, and to (iv) Whether the formal review Washington, DC 20590, (202) 366–6823. generate public interest in film as an art upholds the prior determination or form deserving of preservation. SUPPLEMENTARY INFORMATION: determinations or reverses the prior In the Saint Lawrence Seaway Development EFFECTIVE DATE: Date of Publication. determination or determinations in FOR FURTHER INFORMATION CONTACT: whole or in part and the rationale for Corporation (SLSDC) final rule amending the Seaway regulations and Steve Leggett, Staff Coordinator, The the action. National Film Preservation Board. (v) A statement of the right to request rules (33 CFR part 401) published in the Federal Register on February 28, 2003 Telephone (202) 707–5912; telefax (202) a hearing in any case when the formal 707–2371; email: [email protected]. review determination is less than fully (68 FR 9549), an inadvertent error was made in the heading of the new SUPPLEMENTARY INFORMATION: On August favorable, the issue is appealable, and 9, 1990 (55 FR 32567), the Librarian of the amount in dispute is $300 or more. § 401.20. In the heading, the word ‘‘Automated’’ should have been Congress published the list of films for (5) Effect of formal review 1989 for inclusion in the National Film ‘‘Automatic.’’ This correction makes determination. The formal review Registry in the Library of Congress. On that change. determination is final if one or more of December 24, 1990 (55 FR 52844) the the following exist: In rule FR Doc. 03–4740 published in Librarian published the list of films for (i) The issue is not appealable. (See the Federal Register on February 28, 1990. On September 30, 1991 (56 FR paragraph (a)(6) of this section.) 2003 (68 FR 9549), make the following 49413) the Librarian published the list (ii) The amount in dispute is less than correction: of films for 1991. On July 8, 1994 (59 FR $300. (See paragraph (a)(7) of this 1. On page 9551, in the heading of the 35034) the Librarian published the list section.) new § 401.20, remove ‘‘Automated’’ and of films for 1992 and 1993, bringing the (iii) Appeal rights have been offered add in its place ‘‘Automatic’’. total to 125 films selected under the but a request for hearing is not received 1988 and 1992 Acts. Today, the by OCHAMPUS within 60 days of the Issued in Washington, DC on March 10, Librarian publishes the sixth-fourteenth date of the notice of the formal review 2003. lists of films for inclusion in the determination. Saint Lawrence Seaway Development National Film Registry—twenty-five * * * * * Corporation. additional films selected in each year, Marc C. Owen, 1994–2002, added to the films already Dated: March 7, 2003. Chief Counsel. selected. L.M. Bynum, [FR Doc. 03–6048 Filed 3–12–03; 8:45 am] The 1988 Act expired on September Alternate OSD Federal Register Liaison 27, 1991. The 1992 Act expired on June Officer, Department of Defense. BILLING CODE 4910–61–P 26, 1996. On October 11, 1996, [FR Doc. 03–5954 Filed 3–12–03; 8:45 am] President Clinton signed into law the BILLING CODE 5001–08–M National Film Preservation Act of 1996,

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reauthorizing the National Film (10) Hospital (1970) § 704.27 Films Selected for Inclusion in the Preservation Board for an additional (11) Invasion of the Body Snatchers (1956) National Film Registry in the Library of seven years. The legislation [section (12) The Lady Eve (1941) Congress for 1996. 103(b), 2 U.S.C. 179m] requires the (13) Louisiana Story (1948) (a) The Librarian of Congress, Dr. Librarian of Congress, in consultation (14) The Manchurian Candidate (1962) James H. Billington, after consultation with his advisory group, the National (15) Marty (1955) with the National Film Preservation Film Preservation Board, to select up to (16) Meet Me in St. Louis (1944) Board, registers these films in the (17) Midnight Cowboy (1969) twenty-five films per year for inclusion National Film Registry within the (18) A Movie (1958) Library of Congress for 1996: in the Registry. Under the 1996 Act, (19) Pinocchio (1940) films are selected on the basis of their (20) Safety Last (1923) (1) The Awful Truth (1937) cultural, historical or aesthetic (21) Scarface (1932) (2) Broken Blossoms (1919) significance and they must be at least 10 (22) Snow White (1933) (3) The Deer Hunter (1978) years old. Films do not need to be (23) Tabu (1931) (4) Destry Rides Again (1939) feature length nor have had a theatrical (24) Taxi Driver (1976) (5) Flash Gordon serial (1936) release in order to be included. (25) Zapruder Film (1963) (6) The Forgotten Frontier (1931) These broad criteria allow many types (7) Frank Film (1973) (b) In keeping with section 106(a) of (8) The Graduate (1967) of films to be eligible for inclusion in (9) The Heiress (1949) the National Film Registry. In addition, the Act, 2 U.S.C. 179(p), the Librarian shall endeavor to obtain an archival (10) The Jazz Singer (1927) the Librarian’s procedures for public (11) Life and Times of Rosie the Riveter participation are intended to allow the quality copy for each of these twenty- (1980) public the greatest flexibility in five films for the National Film Registry (12) M*A*S*H (1970) nominating films for inclusion. This is Collection of the Library of Congress. (13) Mildred Pierce (1945) in keeping with the broad goals of the (14) The Outlaw Josey Wales (1976) 3. In subpart A, § 704.26 is added to (15) The Producers (1968) Librarian in administering the National read as follows: Film Preservation Act to promote (16) Pull My Daisy (1959) § 704.26 Films Selected for Inclusion in the (17) Road to Morocco (1942) preservation of the complete American (18) She Done Him Wrong (1933) film heritage and to generate public National Film Registry in the Library of Congress for 1995. (19) Shock Corridor (1963) interest for this cause. (20) Show Boat (1936) List of Subjects in 36 CFR part 704 (a) The Librarian of Congress, Dr. (21) The Thief of Baghdad (1924) James H. Billington, after consultation (22) To Be Or Not To Be (1942) Labeling, Libraries, Motion pictures. with the National Film Preservation (23) Topaz (1943–45) (home movie footage Board, registers these films in the taken at Japanese American Internment Publication of 1994–2002 Film Titles Camp, the Topaz War Relocation Authority National Film Registry within the In consideration of the foregoing, 36 Center) Library of Congress for 1995: (24) Verbena Tragica (1939) CFR part 704 is amended in the manner (25) Woodstock (1970) set forth below. (1) The Adventures of Robin Hood (1938) (2) All That Heaven Allows (1955) (b) In keeping with section 106(a) of PART 704—NATIONAL FILM (3) American Graffiti (1973) the Act, 2 U.S.C. 179(p), the Librarian REGISTRY OF THE LIBRARY OF (4) The Band Wagon (1953) shall endeavor to obtain an archival CONGRESS (5) Blacksmith Scene (1893) quality copy for each of these twenty- (6) Cabaret (1972) five films for the National Film Registry (7) Chan Is Missing (1982) 1. The authority citation for 36 CFR Collection of the Library of Congress. part 704 continues to read as follows: (8) The Conversation (1974) (9) The Day the Earth Stood Still (1951) 5. In subpart A, § 704.28 is added to Authority: Public Law 104–285, 110 Stat. (10) El Norte (1983) read as follows: 3377 (2 U.S.C. 179). (11) Fatty’s Tintype Tangle (1915) § 704.28 Films Selected for Inclusion in the (12) The Four Horsemen of the Apocalypse Subpart A—Films Selected for National Film Registry in the Library of Inclusion in the National Film Registry (1921) Congress for 1997. (13) Fury (1936) (14) Gerald McBoing Boing (1951) (a) The Librarian of Congress, Dr. 2. In subpart A, § 704.25 is added to James H. Billington, after consultation read as follows: (15) The Hospital (1971) (16) Jammin’ the Blues (1944) with the National Film Preservation § 704.25 Films Selected for Inclusion in the (17) The Last of the Mohicans (1920) Board, registers these films in the National Film Registry in the Library of (18) Manhatta (1921) National Film Registry within the Congress for 1994. (19) North By Northwest (1959) Library of Congress for 1997: (a) The Librarian of Congress, Dr. (20) The Philadelphia Story (1940) (1) Ben-Hur (1926) James H. Billington, after consultation (21) Rip Van Winkle (1896) (2) The Big Sleep (1946) (22) Seventh Heaven (1927) with the National Film Preservation (3) The Bridge on the River Kwai (1957) (23) Stagecoach (1939) (4) Cops (1922) Board, registers these films in the (24) To Fly (1976) National Film Registry within the (5) Czechoslovakia 1968 (1968) (25) To Kill a Mockingbird (1962) (6) Grass (1925) Library of Congress for 1994: (7) The Great Dictator (1940) (1) The African Queen (1951) (b) In keeping with section 106(a) of (8) Harold and Maude (1972) (2) The Apartment (1960) the Act, 2 U.S.C. 179(p), the Librarian (9) Hindenburg Disaster Newsreel Footage (3) The Cool World (1963) shall endeavor to obtain an archival (1937) (4) A Corner in Wheat (1909) quality copy for each of these twenty- (10) How the West Was Won (1962) (5) E.T. The Extra-Terrestrial (1982) five films for the National Film Registry (11) The Hustler (1961) (6) The Exploits of Elaine (1914) Collection of the Library of Congress. (12) Knute Rockne, All American (1940) (7) Force of Evil (1948) (13) The Life and Death of 9413—A (8) Freaks (1932) 4. In subpart A, § 704.27 is added to Hollywood Extra (1928) (9) Hell’s Hinges (1916) read as follows: (14) The Little Fugitive (1953)

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(15) Mean Streets (1973) National Film Registry within the (b) In keeping with section 106(a) of (16) Motion Painting No. 1 (1947) Library of Congress for 1999: the Act, 2 U.S.C. 179(p), the Librarian (17) The Music Box (1932) (1) Civilization (1916) shall endeavor to obtain an archival (18) The Naked Spur (1953) quality copy for each of these twenty- (19) Rear Window (1954) (2) Do the Right Thing (1989) (20) Republic Steel Strike Riots Newsreel (3) The Docks of New York (1928) five films for the National Film Registry Footage (1937) (4) Duck Amuck (1953) Collection of the Library of Congress. (21) Return of the Secaucus 7 (1980) (5) The Emperor Jones (1933) 9. In subpart A, § 704.32 is added to (22) The Thin Man (1934) (6) Gunga Din (1939) read as follows: (23) Tulips Shall Grow (1942) (7) In the Land of the Head-Hunters (1914) (24) West Side Story (1961) aka In the Land of the War Canoes § 704.32 Films Selected for Inclusion in the (25) Wings (1927) (8) Jazz on a Summer’s Day (1959) National Film Registry in the Library of (9) King: A Filmed Record . . . Montgomery Congress for 2001. (b) In keeping with section 106(a) of to Memphis (1970) (a) The Librarian of Congress, Dr. the Act, 2 U.S.C. 179(p), the Librarian (10) The Kiss (1896) James H. Billington, after consultation shall endeavor to obtain an archival (11) Kiss Me Deadly (1955) with the National Film Preservation quality copy for each of these twenty- (12) Lambchops (1929) (13) Laura (1944) Board, registers these films in the five films for the National Film Registry (14) Master Hands (1936) National Film Registry within the Collection of the Library of Congress. (15) My Man Godfrey (1936) Library of Congress for 2001: 6. In subpart A, § 704.29 is added to (16) Night of the Living Dead (1968) read as follows: (17) The Plow That Broke the Plains (1936) (1) Abbott and Costello Meet Frankenstein (18) Raiders of the Lost Ark (1981) (1948) § 704.29 Films Selected for Inclusion in the (19) Roman Holiday (1953) (2) All That Jazz (1979) National Film Registry in the Library of (20) The Shop Around the Corner (1940) (3) All the King’s Men (1949) Congress for 1998. (21) A Streetcar Named Desire (1951) (4) America, America (1963) (22) The Ten Commandments (1956) (5) Cologne: From the Diary of Ray and (a) The Librarian of Congress, Dr. Esther (1939) James H. Billington, after consultation (23) Trance and Dance in Bali (1938–39) (24) The Wild Bunch (1969) (6) Evidence of the Film (1913) with the National Film Preservation (25) Woman of the Year (1942) (7) Hoosiers (1986) Board, registers these films in the (8) The House in the Middle (1954) National Film Registry within the (b) In keeping with section 106(a) of (9) It (1927) Library of Congress for 1998: the Act, 2 U.S.C. 179(p), the Librarian (10) Jam Session (1942) shall endeavor to obtain an archival (11) Jaws (1975) (1) Bride of Frankenstein (1935) quality copy for each of these twenty- (12) Manhattan (1979) (2) The City (1939) five films for the National Film Registry (13) Marian Anderson: The Lincoln Memorial (3) Dead Birds (1964) Concert (1939) (4) Don’t Look Back (1967) Collection of the Library of Congress. 8. In subpart A, § 704.31 is added to (14) Memphis Belle (1944) (5) Easy Rider (1969) (15) The Miracle of Morgan’s Creek (1944) (6) 42nd Street (1933) read as follows: (16) Miss Lulu Bett (1921) (7) From the Manger to the Cross (1912) § 704.31 Films Selected for Inclusion in the (17) National Lampoon’s Animal House (8) Gun Crazy (1949) (1978) (9) The Hitch-Hiker (1953) National Film Registry in the Library of Congress for 2000. (18) Planet of the Apes (1968) (10) The Immigrant (1917) (19) Rose Hobart (1936) (11) The Last Picture Show (1972) (a) The Librarian of Congress, Dr. (20) Serene Velocity (1970) (12) Little Miss Marker (1934) James H. Billington, after consultation (21) The Sound of Music (1965) (13) The Lost World (1925) with the National Film Preservation (22) Stormy Weather (1943) (14) Modesta (1956) Board, registers these films in the (23) The Tell-Tale Heart (1953) (15) The Ox-Bow Incident (1943) National Film Registry within the (24) The Thin Blue Line (1988) (16) Pass the Gravy (1928) (25) The Thing From Another World (1951) (17) Phantom of the Opera (1925) Library of Congress for 2000: (18) Powers of Ten (1978) (1) Apocalypse Now (1979) (b) In keeping with section 106(a) of (19) The Public Enemy (1931) (2) Dracula (1931) the Act, 2 U.S.C. 179(p), the Librarian (20) Sky High (1922) (3) The Fall of the House of Usher (1928) shall endeavor to obtain an archival (21) Steamboat Willie (1928) (4) Five Easy Pieces (1970) quality copy for each of these twenty- (22) Tacoma Narrows Bridge Collapse (1940) (5) GoodFellas (1990) five films for the National Film Registry (23) Tootsie (1982) (6) Koyaanisqatsi (1983) Collection of the Library of Congress. (24) Twelve O’Clock High (1949) (7) The Land Beyond the Sunset (1912) (25) ‘‘Westinghouse Works, 1904’’ (1904) (8) Let’s All Go to the Lobby (1957) 10. In subpart A, § 704.33 is added to (9) The Life of Emile Zola (1937) read as follows: (b) In keeping with section 106(a) of (10) Little Caesar (1930) the Act, 2 U.S.C. 179(p), the Librarian (11) The Living Desert (1953) § 704.33 Films Selected for Inclusion in the shall endeavor to obtain an archival (12) Love Finds Andy Hardy (1938) National Film Registry in the Library of quality copy for each of these twenty- (13) Multiple Sidosis (1970) Congress for 2002. five films for the National Film Registry (14) Network (1976) (a) The Librarian of Congress, Dr. Collection of the Library of Congress. (15) Peter Pan (1924) James H. Billington, after consultation 7. In subpart A, § 704.30 is added to (16) Porky in Wackyland (1938) with the National Film Preservation (17) President McKinley Inauguration read as follows: Board, registers these films in the Footage (1901) National Film Registry within the (18) Regeneration (1915) § 704.30 Films Selected for Inclusion in the Library of Congress for 2002: National Film Registry in the Library of (19) Salome (1922) Congress for 1999. (20) Shaft (1971) (1) Alien (1979) (21) Sherman’s March (1986) (2) All My Babies (1953) (a) The Librarian of Congress, Dr. (22) A Star is Born (1954) (3) The Bad and the Beautiful (1952) James H. Billington, after consultation (23) The Tall T (1957) (4) Beauty and the Beast (1991) with the National Film Preservation (24) Why We Fight (series) (1943–45) (5) The Black Stallion (1979) Board, registers these films in the (25) Will Success Spoil Rock Hunter? (1957) (6) Boyz N the Hood (1991)

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(7) Theodore Case Sound Test: Gus Visser SUPPLEMENTARY INFORMATION: The VA Regulatory Flexibility Act and his Singing Duck (1925) ‘‘Medical’’ regulations are set forth at 38 The Secretary hereby certifies that (8) The Endless Summer (1966) CFR Part 17.96. The interim final rule (9) From Here to Eternity (1953) this final rule will not have a significant amending these regulations was economic impact on a substantial (10) From Stump to Ship (1930) published in the Federal Register on (11) Fuji (1974) number of small entities as they are (12) In the Heat of the Night (1967) July 14, 1998 at 63 FR 37779. defined in the Regulatory Flexibility We provided a 60-day comment (13) Lady Windermere’s Fan (1925) Act, 5 U.S.C. 601–612. This rule will period that ended September 14, 1998. (14) Melody Ranch (1940) have only a miniscule effect on any We received two comments. One (15) The Pearl (1948) small entity. Therefore, pursuant to 5 (16) Punch Drunks (1934) commenter expressed support. The U.S.C. 605(b), this rule is exempt from (17) Sabrina (1954) other commenter stated that the (18) Star Theatre (1901) eligibility criteria should be liberalized the initial and final regulatory flexibility (19) Stranger Than Paradise (1984) to only require that a veteran be analysis requirements of §§ 603 and 604. (20) This is Cinerama (1952) ‘‘eligible for compensation or pension Catalog of Federal Domestic Assistance (21) This is Spinal Tap (1984) benefits.’’ However, there is a statutory (22) Through Navajo Eyes (series) (1966) Program Number requirement that a veteran be in receipt (23) Why Man Creates (1968) The Catalog of Federal Domestic of benefits to qualify for the provision (24) Wild and Wooly (1917) Assistance program number for this of drugs and medicines. 38 U.S.C. (25) Wild River (1960) document is 64.012. 1712(d). No change is made based upon (b) In keeping with section 106(a) of this comment. This commenter also List of Subjects in 38 CFR Part 17 the Act, 2 U.S.C. 179(p), the Librarian states that it would be more efficient Administrative practice and shall endeavor to obtain an archival and cost-effective to authorize state quality copy for each of these twenty- procedure, Alcohol abuse, Alcoholism, homes to purchase prescription drugs Claims, Day care, Dental health, Drug five films for the National Film Registry and medicines from local VA suppliers. Collection of the Library of Congress. abuse, Foreign relations, Government No change in the regulation is made contracts, Grant programs-health, Grant James H. Billington, based upon this comment. What the programs-veterans, Health care, Health The Librarian of Congress. commenter suggests is what is facilities, Health professions, Health [FR Doc. 03–5958 Filed 3–12–03; 8:45 am] happening in those state homes that records, Homeless, Medical and dental have contracts with VA to furnish drugs BILLING CODE 1410–34–P schools, Medical devices, Medical off the Federal Supply Schedule at the research, Mental health programs, same price that VA pays. If other state Nursing homes, Philippines, Reporting DEPARTMENT OF VETERANS homes want access to the Federal and recordkeeping requirements, AFFAIRS Supply Schedule, they may achieve that Scholarships and fellowships, Travel access by contracting with VA. Based on and transportation expenses, Veterans. 38 CFR Part 17 the rationale set forth in the interim final rule and in this document we now Approved: March 3, 2003. RIN 2900–AJ34 affirm as a final rule the changes made Anthony J. Principi, by the interim final rule. Secretary of Veterans Affairs. Provision of Drugs and Medicines to Certain Veterans in State Homes Paperwork Reduction Act PART 17—MEDICAL This document contains no provisions AGENCY: Department of Veterans Affairs. Accordingly, the interim final rule constituting a collection of information ACTION: Final rule. amending 38 CFR part 17 which was under the Paperwork Reduction Act (44 published at 63 FR 37779 on July 14, U.S.C. 3501–3521). SUMMARY: This document affirms 1998, is adopted as a final rule without amendments to the Department of Administrative Procedure Act change. Veterans Affairs ‘‘Medical’’ regulations concerning the provision of drugs and This document without any changes [FR Doc. 03–6099 Filed 3–12–03; 8:45 am] medicines prescribed by non-VA affirms amendments made by an interim BILLING CODE 8320–01–P physicians for certain veterans who are final rule that is already in effect. permanently housebound or in need of Accordingly, we have concluded under regular aid and attendance. The 5 U.S.C. 553 that there is good cause for ENVIRONMENTAL PROTECTION amendments allow prescriptions to be dispensing with a delayed effective date AGENCY filled by non-VA pharmacies in state based on the conclusion that such homes under contract with VA for procedure is impracticable, 40 CFR Part 52 unnecessary, and contrary to the public filling prescriptions for patients in state [FL–82–200309(w); FRL–7466–4] homes. This is consistent with VA’s interest. special relationship with state homes. It Unfunded Mandates Approval and Promulgation of eliminates duplication of services and Implementation Plans for Florida: The Unfunded Mandates Reform Act Withdrawal of Direct Final Rule helps to improve timeliness for filling requires, at 2 U.S.C. 1532, that agencies prescriptions in state homes. prepare an assessment of anticipated AGENCY: Environmental Protection DATES: Effective Date: March 13, 2003. costs and benefits before developing any Agency (EPA). FOR FURTHER INFORMATION CONTACT: Jeff rule that may result in an expenditure ACTION: Withdrawal of direct final rule. Ramirez, Pharmacy Service (119), by State, local, or tribal governments, in Veterans Health Administration, the aggregate, or by the private sector of SUMMARY: Due to adverse comment, EPA Department of Veterans Affairs, 810 $100 million or more in any given year. is withdrawing the direct final rule Vermont Avenue NW., Washington, DC This rule would have no consequential published January 27, 2003, (see 68 FR 20420, (202) 273–8428. (This is not a effect on State, local, or tribal 3817) approving revisions to the Florida toll-free number.) governments. State Implementation Plan. The purpose

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of the revision to rule 62–212.400 was requirements of sections 111(d) and 129 the State, except for those small MWCs to correct discrepancies between State of the Clean Air Act. located on Indian Nation land. New and Federal rule language on DATES: This direct final rule is effective York submitted its plan to fulfill the exemptions from Prevention of on May 12, 2003 without further notice, requirements of section 111(d) and 129 Significant Deterioration and to include unless EPA receives adverse comment of the Clean Air Act (CAA). The State additional provisions. EPA stated in the by April 14, 2003. plan adopts and implements the direct final rule that if EPA received If EPA receives such comment, EPA Emission Guidelines (EG) applicable to adverse comment by February 26, 2003, will publish a timely withdrawal in the existing small MWCs, and establishes the rule would be withdrawn and not Federal Register informing the public emission limits and other requirements take effect. EPA subsequently received that this rule will not take effect. for units constructed on or before adverse comment. EPA will address the ADDRESSES: All comments should be August 30, 1999. This approval, once comment in a subsequent final action addressed to: Raymond Werner, Chief, effective, will make the New York small based upon the proposed action Air Programs Branch, Environmental MWC rules included in the State plan published on January 27, 2003 (see 68 Protection Agency, Region II Office, 290 federally enforceable. FR 3847). EPA will not institute a Broadway, New York, New York 10007– B. Why Is EPA Taking This Action? second comment period on this action. 1866. DATES: The direct final rule is Copies of the state submittal is EPA has evaluated New York’s small withdrawn as of March 13, 2003. available at the following addresses for MWC State plan for consistency with the CAA, EPA guidelines and policy. FOR FURTHER INFORMATION CONTACT: inspection during normal business EPA has determined that New York’s Heidi LeSane, Air Planning Branch, U.S. hours: Environmental Protection Agency, State plan meets all requirements and Environmental Protection Agency therefore, EPA is approving New York’s Region 4, 61 Forsyth Street, SW., Region II Office, Air Programs Branch, 290 Broadway, 25th Floor, New York, State plan to implement and enforce the Atlanta, Georgia 30303–8960. Phone EG applicable to existing small MWCs. number: 404/562–9035; E-mail: New York 10007–1866. [email protected]. New York State Department of C. Who Is Affected by New York’s State Environmental Conservation, Division Plan? List of Subjects in 40 CFR Part 52 of Air Resources, 625 Broadway, 2nd New York’s State plan regulates all Floor, Albany, New York 12233. Environmental protection, Air the units designated by the EG for pollution control, Intergovernmental FOR FURTHER INFORMATION CONTACT: existing small MWCs which relations, Ozone, Particulate matter, Anthony (Ted) Gardella, Air Programs commenced construction on or before Reporting and recordkeeping Branch, Environmental Protection August 30, 1999 and which have the requirements, Volatile organic Agency, 290 Broadway, 25th Floor, New capacity to combust at least 35 tons per compounds. York, New York 10007–1866, (212) 637– day of municipal solid waste or refuse- Dated: March 6, 2003. 4249. derived fuel but no more than 250 tons J.I. Palmer, Jr., SUPPLEMENTARY INFORMATION: The per day of municipal solid waste or Regional Administrator, Region 4. following table of contents describes the refuse-derived fuel. If the owner or format for the SUPPLEMENTARY [FR Doc. 03–6111 Filed 3–12–03; 8:45 am] operator of a small MWC made changes INFORMATION section: BILLING CODE 6560–50–P after June 6, 2001, that meet the I. EPA Action definition of modification or A. What action is EPA taking today? reconstruction for subpart AAAA (New ENVIRONMENTAL PROTECTION B. Why is EPA taking this action? Source Performance Standards for New AGENCY C. Who is affected by New York’s State Small Municipal Waste Combustion plan? Units) of 40 CFR part 60, the small 40 CFR Part 62 D. How does this approval affect sources MWC unit becomes subject to subpart located in Indian Nation Land? [Region II Docket No. NY58–253a, FRL– E. How does this approval relate to the AAAA and the State plan no longer 7464–8] Federal plan? applies to that unit. II. Background D. How Does This Approval Affect Approval and Promulgation of State A. What is a State plan? Sources Located in Indian Nation Land? Plans for Designated Facilities; New B. What is a small MWC State plan? York C. Why is EPA requiring New York to New York’s State plan does not cover submit a small MWC State plan? units located in Indian Nation Land. AGENCY: Environmental Protection D. What are the requirements for a small Therefore, any units located in Indian Agency (EPA). MWC State plan? Nation Land will be subject to the III. New York’s State Plan ACTION: Direct final rule. Federal plan, subpart JJJ of 40 CFR part A. What is contained in the New York 62, promulgated on January 31, 2003 State plan? SUMMARY: The Environmental Protection (see 68 FR 5144). Agency (EPA) is taking direct final B. What approval criteria did we use to evaluate New York’s State plan? action to approve the State plan E. How Does This Approval Relate to the IV. EPA’s Rulemaking Action Federal Plan? submitted by New York State to V. Statutory and Executive Order Reviews implement and enforce the Emission The Federal plan is applicable to Guidelines (EG) for existing small I. EPA Action small MWC units located in Indian Municipal Waste Combustion (MWC) Nation Land and units throughout New Units. New York’s plan establishes A. What Action Is EPA Taking Today? York for which there is no approved emission limits and other requirements EPA is approving New York’s State State plan. Therefore, until this for the purpose of reducing toxic air plan, submitted on October 22, 2002, for approval action becomes effective, small emissions from small MWC units the control of air emissions from MWC units within New York State’s throughout the State. New York existing small Municipal Waste jurisdiction are subject to the Federal submitted its plan to fulfill the Combustion (MWC) units throughout plan. Upon approval of New York’s

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State plan, small MWC units within the standards set in the EG. New York has Subpart 219–8, which addresses the State of New York’s jurisdiction will be developed and submitted a State plan, applicability of the various Part 219 subject to New York’s State plan as of as required by section 111(d) of the (New York’s incineration rules) the effective date of this action and the CAA, to gain Federal approval to requirements. Part 219 now includes the Federal plan will no longer apply. implement and enforce the small MWC new requirements incorporated from the EG. EG, as well as the necessary compliance II. Background schedules and necessary definition D. What Are the Requirements for a A. What Is a State Plan? changes required for the transformation Small MWC State Plan? Section 111 of the CAA, ‘‘Standards of of emission guidelines into a State plan. A section 111(d) State plan submittal Performance for New Stationary As a result, the Part 219 requirements must meet the requirements of 40 CFR Sources,’’ authorizes EPA to set air are enforceable by New York and part 60, subpart B, §§ 60.23 through emissions standards for certain become federally enforceable once the 60.26, and 40 CFR part 60, subpart categories of sources. These standards State plan is approved by EPA. BBBB (see 62 FR 76378, December 6, New York’s State plan contains the are called New Source Performance 2000). Subpart B contains the following: Standards (NSPS). When a NSPS is procedures for the adoption and (1) A demonstration of the State’s promulgated for new sources, section submittal of State plans. This subpart legal authority to implement the section 111(d) also requires that EPA publish an addresses public participation, legal 111(d) State plan; EG applicable to the control of the same authority, emission standards and other (2) State rules adopted into 6NYCRR pollutant from existing (or designated) emission limitations, compliance Parts 200 and 219 as the mechanism for facilities. States with designated schedules, emission inventories, source implementing and enforcing the State facilities must then develop a State plan surveillance, and compliance assurance plan; to adopt the EG into the State’s body of and enforcement requirements. (3) An inventory of three known small regulations. States must also include in EPA promulgated the EG as 40 CFR MWC facilities, including eight small their State plan other requirements, part 60, subpart BBBB on December 6, MWC units, along with an inventory of such as inventories, legal authority, and 2000. Subpart BBBB contains the their air pollutant emissions; public participation documentation, to technical requirements for existing (4) Emission limits that are as demonstrate their ability to enforce the small MWCs and applies to units that protective as the EG; State plans. commenced construction on or before (5) Enforceable compliance schedules B. What Is a Small MWC State Plan? August 30, 1999. A state will generally incorporated into Part 219, New York’s address the small MWC technical incineration rule. For Class I Units, A small MWC State plan is a State requirements by adopting by reference compliance dates vary from three years plan, as described above, that controls subpart BBBB. The section 111(d) state from the effective date of EPA’s air pollutant emissions from existing plan is required to be submitted within approval of New York’s State plan to not small incinerators with a combustion one year of the EG promulgation date, later than December 6, 2005, whichever design capacity of 35 to 250 tons per i.e. by December 6, 2001. Prior to is earlier. For Class II Units, compliance day of municipal solid waste or refuse submittal to EPA, the State must make dates vary from one year from the derived fuel that commenced available to the public the State plan effective date of EPA’s approval of New construction on or before August 30, and provide opportunity for public York’s State plan to not later than 1999. comment. December 6, 2005, whichever is earlier. C. Why Is EPA Requiring New York To (6) Testing, monitoring, reporting and III. New York’s State Plan Submit a Small MWC State Plan? recordkeeping requirements for the designated facilities; When EPA developed the NSPS for A. What Is Contained in the New York State Plan? (7) Records of the public hearing on small MWCs, we simultaneously the State plan; and, developed the EG to control air On October 22, 2002, the New York (8) Provisions for annual state emissions from existing small MWCs State Department of Environmental progress reports to EPA on (see 62 FR 76378, December 6, 2000). Conservation (NYSDEC) submitted its implementation of the State plan. Under section 129 of the CAA, the EG section 111(d) State plan for is not federally enforceable; therefore, implementing EPA’s EG for existing B. What Approval Criteria Did We Use section 129 of the CAA also requires small MWC units located in New York To Evaluate New York’s State Plan? states to submit to EPA for approval State. EPA reviewed New York’s State plan State plans that implement and enforce New York has adopted by reference for approval against the following the EG. These State plans must be at the requirements of the EG in Part 200 criteria: 40 CFR 60.23 through 60.26 , least as protective as the EG, and they of Title 6 of the New York Code of Rules ‘‘Subpart B—Adoption and Submittal of become federally enforceable upon and Regulations (6NYCRR) of the State State Plans for Designated Facilities;’’ approval by EPA. of New York, entitled ‘‘General and 40 CFR 60.1600 through 60.1940, The procedures for adopting and Provisions’’ and in Subpart 219–1 of ‘‘Subpart BBBB—Emission Guidelines submitting State plans are located in 40 6NYCRR entitled ‘‘Incineration-General and Compliance Times for Small CFR part 60, subpart B. If a state fails Provisions’’ and Subpart 219–8 of Municipal Waste Combustion Units to have an approvable plan in place by 6NYCRR entitled ‘‘Emission Guidelines Constructed on or Before August 30, December 6, 2001, the EPA is required and Compliance Times for Small 1999.’’ to promulgate a Federal plan to Municipal Waste Combustion Units establish requirements for those sources Constructed on or before August 30, IV. EPA’s Rulemaking Action not under an EPA-approved State plan. 1999.’’ These amended regulations The EPA has determined that New Even though EPA promulgated the became effective on October 18, 2002. York’s State plan meets all the Federal plan on January 31, 2003, New By incorporating the EG by reference applicable approval criteria and, York’s State plan is approvable since it into Part 200, NYSDEC has the authority therefore, EPA is approving, through was deemed at least as protective as the to include them as applicable within direct final rulemaking action, New

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York State’s sections 111(d) and 129 local, or tribal governments in the impose substantial direct compliance State plan for small MWCs. aggregate; or to the private sector, of costs on state or local governments, nor The EPA is publishing this rule $100 million or more. Under section will it preempt state law. Thus, the without prior proposal because the 205, EPA must select the most cost- requirements of sections 6(b) and 6(c) of Agency views this as a noncontroversial effective and least burdensome the Executive Order do not apply to this submittal and anticipates no adverse alternative that achieves the objectives rule. comments. However, in the proposed of the rule and is consistent with rules section of this Federal Register statutory requirements. Section 203 Executive Order 13175: Consultation publication, EPA is publishing a requires EPA to establish a plan for and Coordination With Indian Tribal separate document that will serve as the informing and advising any small Governments proposal to approve the SIP revision governments that may be significantly should adverse comments be filed. This or uniquely impacted by the rule. Executive Order 13175, entitled rule will be effective May 12, 2003 EPA has determined that the approval ‘‘Consultation and Coordination with without further notice unless the action promulgated does not include a Indian Tribal Governments’’ (65 FR Agency receives adverse comments by Federal mandate that may result in 67249, November 6, 2000), requires EPA April 14, 2003. estimated costs of $100 million or more to develop an accountable process to If the EPA receives adverse to either state, commonwealth, local, or ensure ‘‘meaningful and timely input by comments, then EPA will publish a tribal governments in the aggregate, or tribal officials in the development of timely withdrawal in the Federal to the private sector. This Federal action regulatory policies that have tribal Register informing the public that the approves pre-existing requirements implications.’’ ‘‘Policies that have tribal rule will not take effect. EPA will under state or local law, and imposes no implications’’ is defined in the address all public comments in a new requirements. Accordingly, no Executive Order to include regulations subsequent final rule based on the additional costs to state, that have ‘‘substantial direct effects on proposed rule. The EPA will not commonwealth, local, or tribal one or more Indian tribes, on the institute a second comment period on governments, or to the private sector, relationship between the Federal result from this action. this action. Any parties interested in government and the Indian tribes, or on commenting must do so at this time. Executive Order 13132: Federalism the distribution of power and V. Statutory and Executive Order Executive Order 13132, entitled responsibilities between the Federal Reviews ‘‘Federalism’’ (64 FR 43255, August 10, government and Indian tribes.’’ 1999), requires EPA to develop an This rule does not have tribal Executive Order 12866: Regulatory accountable process to ensure Planning and Review implications. It will not have substantial ‘‘meaningful and timely input by state direct effects on tribal governments, on The Office of Management and Budget and local officials in the development of the relationship between the Federal (OMB) has exempted this regulatory regulatory policies that have federalism government and Indian tribes, or on the action from Executive Order 12866, implications.’’ ‘‘Policies that have distribution of power and entitled ‘‘Regulatory Planning and federalism implications’’ is defined in responsibilities between the Federal Review.’’ the Executive Order to include government and Indian tribes, as regulations that have ‘‘substantial direct Regulatory Flexibility Act specified in Executive Order 13175. effects on the states, on the relationship Thus, Executive Order 13175 does not The Regulatory Flexibility Act (RFA) between the national government and generally requires an agency to conduct the states, or on the distribution of apply to this rule. a regulatory flexibility analysis of any power and responsibilities among the Executive Order 13045: Protection of rule subject to notice and comment various levels of government.’’ Children From Environmental Health rulemaking requirements unless the Under section 6(b) of Executive Order and Safety Risks agency certifies that the rule will not 13132, EPA may not issue a regulation have a significant economic impact on that has federalism implications, that Protection of Children from a substantial number of small entities. imposes substantial direct compliance Environmental Health Risks and Safety Small entities include small businesses, costs, and that is not required by statute, Risks (62 FR 19885, April 23, 1997), small not-for-profit enterprises, and unless the Federal government provides applies to any rule that: (1) Is small governmental jurisdictions. the funds necessary to pay the direct determined to be ‘‘economically This rule will not have a significant compliance costs incurred by state and significant’’ as defined under Executive impact on a substantial number of small local governments, or EPA consults with Order 12866, and (2) concerns an entities. Therefore, because the Federal state and local officials early in the environmental health or safety risk that approval does not create any new process of developing the proposed EPA has reason to believe may have a requirements, I certify that this action regulation. Under section 6(c) of disproportionate effect on children. If will not have a significant economic Executive Order 13132, EPA may not the regulatory action meets both criteria, impact on a substantial number of small issue a regulation that has federalism the Agency must evaluate the entities. implications and that preempts state environmental health or safety effects of law, unless the Agency consults with Unfunded Mandates Reform Act the planned rule on children, and state and local officials early in the explain why the planned regulation is Under sections 202 of the Unfunded process of developing the proposed preferable to other potentially effective Mandates Reform Act of 1995 regulation. (‘‘Unfunded Mandates Act’’), signed New York’s State plan applies to all and reasonably feasible alternatives into law on March 22, 1995, EPA must affected sources regardless of whether it considered by the Agency. prepare a budgetary impact statement to has been identified in its plan. This rule is not subject to Executive accompany any proposed or final rule Therefore, EPA has concluded that this Order 13045 because it does not involve that includes a Federal mandate that rulemaking action does not have decisions intended to mitigate may result in estimated costs to state, federalism implications. It will not environmental health or safety risks.

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National Technology Transfer Dated: March 3, 2003. Act (RCRA). EPA has determined that Advancement Act Jane M. Kenny, these changes satisfy all requirements Section 12 of the National Technology Regional Administrator, Region 2. needed to qualify for final authorization Transfer Advancement Act (NTTAA) of Part 62, chapter I, title 40 of the Code and is authorizing Virginia’s changes 1995 requires Federal agencies to of Federal Regulations is amended as through this immediate final action. evaluate existing technical standards follows: EPA is publishing this rule to authorize when developing a new regulation. To the changes without a prior proposal comply with NTTAA, EPA must PART 62—[AMENDED] because we believe this action is not consider and use ‘‘voluntary consensus controversial and do not expect 1. The authority citation for part 62 standards’’ (VCS) if available and comments that oppose it. Unless we continues to read as follows: applicable when developing programs receive written comments which oppose and policies unless doing so would be Authority: 42 U.S.C. 7401–7671q. this authorization during the comment inconsistent with applicable law or period, the decision to authorize otherwise impractical. Subpart HH—New York Virginia’s changes to its hazardous The EPA believes that VCS are waste program will take effect. If we 2. Part 62 is amended by adding new inapplicable to this action. Today’s receive comments that oppose this § 62.8107 and an undesignated heading action does not require the public to action, we will publish a document in to subpart HH to read as follows: perform activities conducive to the use the Federal Register withdrawing this Air Emissions From Existing Small of VCS. rule before it takes effect, and a separate Municipal Waste Combustion Units document in the proposed rules section Congressional Review Act With The Capacity To Combust At Least of this Federal Register will serve as a The Congressional Review Act, 5 35 Tons Per Day But No More Than 250 proposal to authorize the changes. U.S.C. section 801 et seq., as added by Tons Per Day Of Municipal Solid Waste DATES: This final authorization will the Small Business Regulatory Or Refuse Derived Fuel and Constructed become effective on May 12, 2003, Enforcement Fairness Act of 1996, on or Before August 30, 1999. unless EPA receives adverse written generally provides that before a rule § 62.8107 Identification of plan. comment by April 14, 2003. If EPA may take effect, the agency receives any such comment, it will (a) On October 22, 2002, the New promulgating the rule must submit a publish a timely withdrawal of this York State Department of rule report, which includes a copy of immediate final rule in the Federal the rule, to each House of the Congress Environmental Conservation submitted Register and inform the public that this and to the Comptroller General of the to the Environmental Protection Agency authorization will not take effect as United States. EPA will submit a report ‘‘Section 111(d)/129 State Plan for scheduled. Implementation of Municipal Waste containing this rule and other required ADDRESSES: Send written comments to information to the U.S. Senate, the U.S. Combustor Emission Guidelines [Title 40 CFR Part 60, Subparts B and BBBB]’’ Joanne Cassidy, Mailcode 3WC21, House of Representatives, and the RCRA State Programs Branch, U.S. EPA Comptroller General of the United (b) Identification of sources: The plan applies to all existing Small Municipal Region III, 1650 Arch Street, States prior to publication of the rule in Philadelphia, PA 19103, Phone number: the Federal Register. A major rule Waste Combustion Units with the capacity to combust at least 35 tons per (215) 814–3381. You may inspect and cannot take effect until 60 days after it copy Virginia’s application from 8:15 is published in the Federal Register. day but no more than 250 tons per day a.m. to 4:30 p.m., at the following This action is not a ‘‘major rule’’ as of municipal solid waste or refuse addresses: Virginia Department of defined by 5 U.S.C. section 804(2). This derived fuel and constructed on or Environmental Quality, Division of rule will be effective May 12, 2003 before August 30, 1999. Waste Program Coordination, 629 East unless EPA receives material adverse (c) The effective date for the portion Main Street, Richmond, VA 23219, written comments by April 14, 2003. of the plan applicable to existing municipal waste combustor units is May Phone number: (804) 698–4213, attn: Petitions for Judicial Review 12, 2003. Robert Wickline, and Virginia Department of Environmental Quality, Under section 307(b)(1) of the Clean [FR Doc. 03–5908 Filed 3–12–03; 8:45 am] Air Act, petitions for judicial review of West Central Regional Office, 3019 BILLING CODE 6560–50–P this action must be filed in the United Peters Creek Road, Roanoke, VA 24015, States Court of Appeals for the Phone number: (540) 562–6872, attn: Aziz Farahmand, and EPA Region III, appropriate circuit by May 12, 2003. ENVIRONMENTAL PROTECTION Library, 2nd Floor, 1650 Arch Street, Filing a petition for reconsideration by AGENCY the Administrator of this final rule does Philadelphia, PA 19103, Phone number: not affect the finality of this rule for the 40 CFR Part 271 (215) 814–5254. purposes of judicial review nor does it FOR FURTHER INFORMATION CONTACT: [FRL–7465–8] extend the time within which a petition Joanne Cassidy, Mailcode 3WC21, for judicial review may be filed, and Virginia: Final Authorization of State RCRA State Programs Branch, U.S. EPA shall not postpone the effectiveness of Hazardous Waste Management Region III, 1650 Arch Street, such rule or action. This action may not Program Revision Philadelphia, PA 19103, Phone number: be challenged later in proceedings to (215) 814–3381. enforce its requirements. (See section AGENCY: Environmental Protection SUPPLEMENTARY INFORMATION: 307(b)(2).) Agency (EPA). A. Why Are Revisions to State List of Subjects in 40 CFR Part 62 ACTION: Immediate final rule. Programs Necessary? Environmental protection, Air SUMMARY: Virginia has applied to EPA States which have received final pollution control, Intergovernmental for final authorization of changes to its authorization from EPA under RCRA relations, Lead, Reporting and hazardous waste program under the section 3006(b), 42 U.S.C. 6926(b), must recordkeeping requirements. Resource Conservation and Recovery maintain a hazardous waste program

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that is equivalent to, consistent with, authority under RCRA sections 3007, effective December 18, 1984 (49 FR and no less stringent than the Federal 3008, 3013, and 7003, which include, 47391), to implement the RCRA program. As the Federal program among others, authority to: hazardous waste management program. changes, States must change their • Perform inspections, and require EPA granted authorization for changes programs and ask EPA to authorize the monitoring, tests, analyses or reports; to Virginia’s regulatory program on July • changes. Changes to State programs may Enforce RCRA requirements and 31, 2000, effective September 29, 2000 be necessary when Federal or State suspend or revoke permits; and (65 FR 46606). statutory or regulatory authority is • Take enforcement actions regardless modified or when certain other changes of whether Virginia has taken its own G. What Changes Are We Authorizing occur. Most commonly, States must actions. With Today’s Action? change their programs because of This action does not impose changes to EPA’s regulations in 40 Code additional requirements on the On September 24, 2002, Virginia of Federal Regulations (CFR) parts 124, regulated community because the submitted a final complete program 260 through 266, 268, 270, 273 and 279. regulations for which Virginia is being revision application, seeking authorized by today’s action are already authorization of its changes in B. What Decisions Has EPA Made in effective and are not changed by today’s accordance with 40 CFR 271.21. This Rule? action. Virginia’s revision application includes EPA concludes that Virginia’s D. Why Wasn’t There a Proposed Rule changes to the Federal hazardous waste application to revise its authorized Before Today’s Rule? program, as published in the Federal program meets all of the statutory and Register from December 6, 1994 through regulatory requirements established by EPA did not publish a proposal before June 30, 2001, as well as miscellaneous today’s rule because we view this as a RCRA. Therefore, we grant Virginia final changes to its previously-authorized routine program change and do not authorization to operate its hazardous program. We now make an immediate expect comments that oppose this waste program with the changes final decision, subject to receipt of described in its application for program approval. We are providing an written comments that oppose this revisions. Virginia has responsibility for opportunity for public comment now. In action, that Virginia’s hazardous waste permitting treatment, storage, and addition to this rule, in the proposed disposal facilities (TSDFs) within its rules section of today’s Federal Register program revision satisfies all of the borders and for carrying out the aspects we are publishing a separate document requirements necessary to qualify for of the RCRA program described in its that proposes to authorize Virginia’s final authorization. Therefore, EPA application, subject to the limitations of program changes. If EPA receives grants Virginia final authorization for the Hazardous and Solid Waste comments which oppose this the following program changes: Amendments of 1984 (HSWA). New authorization that document will serve 1. Program Revision Changes for Federal Federal requirements and prohibitions as a proposal to authorize such changes. Rules Published Between December 20, imposed by Federal regulations that E. What Happens if EPA Receives 1994 and June 30, 2001 EPA promulgates under the authority of Comments That Oppose This Action? HSWA take effect in authorized States Virginia seeks authority to administer before they are authorized for the If EPA receives comments that oppose the Federal requirements that are listed requirements. Thus, EPA will this authorization, we will withdraw in Table 1. Except as noted in the Table, implement those HSWA requirements this rule by publishing a document in Virginia incorporates by reference these and prohibitions in Virginia, including the Federal Register before the rule Federal provisions, in accordance with issuing HSWA permits, until the State is becomes effective. EPA will base any the dates specified in Title 9, Virginia further decision on the authorization of granted authorization to do so. Administrative Code (9 VAC 20–60–18). Virginia’s program changes on the Table 1 lists Virginia’s requirements that C. What Is the Effect of Today’s proposal mentioned in the previous are being recognized as no less stringent Authorization Decision? paragraph. We will then address all The effect of this decision is that a public comments in a later final rule. than the analogous Federal facility in Virginia subject to RCRA will You may not have another opportunity requirements. The Virginia Waste now have to comply with the authorized to comment. If you want to comment on Management Act (VWMA), enacted by Virginia regulatory revisions instead of this authorization, you must do so at the 1986 session of the Virginia’s the equivalent revised Federal this time. General Assembly and recodified in requirements in order to comply with 1988 as Chapter 14, Title 10.1, Code of RCRA. Virginia has enforcement F. What Has Virginia Previously Been Virginia, forms the basis of the Virginia responsibilities under its state Authorized for? program. The regulatory references are hazardous waste program for violations Virginia initially received final to Title 9, Virginia Administrative Code of its program, but EPA retains its authorization on December 4, 1984, (9 VAC) effective November 21, 2001.

TABLE 1.—VIRGINIA’S ANALOGS TO THE FEDERAL REQUIREMENTS

Description of Federal requirement (Revision Federal Register Analogous Virginia authority checklists 1)

RCRA Cluster V 2

Universal Treatment Standards and Treatment 60 FR 242, 1/3/95 ...... Title 9, Virginia Administrative Code (9 VAC) §§ 20– Standards for Organic Characteristic Wastes and 60–18 and 20–60–268 A Newly Listed Waste (Revision Checklist 137). Testing and Monitoring Activities Amendment I (Revi- 60 FR 3089, 1/13/95 ...... 9 VAC §§ 20–60–18 and 20–60–260 A sion Checklist 139).

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TABLE 1.—VIRGINIA’S ANALOGS TO THE FEDERAL REQUIREMENTS—Continued

Description of Federal requirement (Revision Federal Register Analogous Virginia authority checklists 1)

Carbamate Production Identification and Listing of 60 FR 7824, 2/9/95 ...... 9 VAC §§ 20–60–18 and 20–60–261 A Hazardous Waste (Revision Checklist 140). 60 FR 19165, 4/17/95 ...... 60 FR 25619, 5/12/95 ...... Testing and Monitoring Activities Amendment II (Re- 60 FR 17001, 4/4/95 ...... 9 VAC §§ 20–60–18 and 20–60–260 A vision Checklist 141). Removal of Legally Obsolete Rules (Revision Check- 60 FR 33912, 6/29/95 ...... 9 VAC §§ 20–60–18, 20–60–261 A, 20–60–266 A list 144). and 20–60–270 A

RCRA Cluster VI

Liquids in Landfills III (Revision Checklist 145) ...... 60 FR 35703, 7/11/95 ...... 9 VAC §§ 20–60–18, 20–60–264 A and 20–60–265 A RCRA Expanded Public Participation (Revision 60 FR 63417, 12/11/95 ...... 9 VAC §§ 20–60–18, 20–60–124 A and 20–60–270 Checklist 148). A Recovered Oil Exclusion, Correction (Revision 61 FR 13103, 3/26/96 ...... 9 VAC §§ 20–60–18 and 20–60–261 A Checklist 150). Land Disposal Restrictions Phase III— 61 FR 15566, 4/8/96 ...... 9 VAC §§ 20–60–18 and 20–60–268 A Decharacterized Wastewaters, Carbamate Wastes, 61 FR 15660, 4/8/96 ...... and Spent Potliners (Revision Checklist 151). 61 FR 19117, 4/30/96 ...... 61 FR 33680, 6/28/96 ...... 61 FR 36419, 7/10/96 ...... 61 FR 43924, 8/26/96 ...... 62 FR 7502, 2/19/97 ......

RCRA Cluster VII

Conditionally Exempt Small Quantity Generator Dis- 61 FR 34252, 7/1/96 ...... 9 VAC §§ 20–60–18 and 20–60–261 A posal Options Under Subtitle D (Revision Checklist 153). Organic Air Emission Standards for Tanks, Surface 59 FR 62896, 12/6/94 ...... 9 VAC §§ 20–60–18, 20–60–260 A, 20–60–261 A, Impoundments, and Containers (Revision Checklist 60 FR 26828, 5/19/95 ...... 20–60–262 A, 20–60–264 A, 20–60–265 A and 154). 60 FR 50426, 9/29/95 ...... 20–60–270 A 60 FR 56952, 11/13/95 ...... 61 FR 4903, 2/9/96 ...... 61 FR 28508, 6/5/96 ...... 61 FR 59932, 11/25/96 ...... Land Disposal Restrictions Phase III—Emergency 62 FR 1992, 1/14/97 ...... 9 VAC §§ 20–60–18 and 20–60–268 A Extension of the K088 Capacity Variance (Revision Checklist 155). Military Munitions Rule (Revision Checklist 156) ...... 62 FR 6622, 2/12/97 ...... 9 VAC §§ 20–60–18, 20–60–260 A, 20–60–261 A, 20–60–262 A, 20–60–263 A, 20–60–264 A, 20– 60–265 A, 20–60–266 A and 20–60–270 A Land Disposal Restrictions—Phase IV (Revision 62 FR 25998, 5/12/97 ...... 9 VAC §§ 20–60–18, 20–60–261 A and 20–60–268 Checklist 157). A Testing and Monitoring Activities Amendment III (Re- 62 FR 32452, 6/13/97 ...... 9 VAC §§ 20–60–18, 20–60–260 A, 20–60–264 A, vision Checklist 158). 20–60–265 A and 20–60–266 A Carbamate Production, Identification and Listing of 62 FR 32974, 6/17/97 ...... 9 VAC §§ 20–60–18, 20–60–261 A and 20–60–268 Hazardous Waste; Land Disposal Restrictions A (Conformance With the Carbamate Vacatur) (Revi- sion Checklist 159).

RCRA Cluster VIII

Land Disposal Restrictions Phase III—Emergency 62 FR 37694, 7/14/97 ...... 9 VAC §§ 20–60–18 and 20–60–268 A Extension of the K088 National Capacity Variance (Revision Checklist 160). Second Emergency Revision of the Land Disposal 62 FR 45568, 8/28/97 ...... 9 VAC §§ 20–60–18 and 20–60–268 A Restrictions (LDR) Treatment Standards for Listed Hazardous Wastes From Carbamate Production (Revision Checklist 161). Clarification of Standards for Hazardous Waste Land 62 FR 64504, 12/5/97 ...... 9 VAC §§ 20–60–18 and 20–60–268 A Disposal Restriction Treatment Variances (Revi- sion Checklist 162). Organic Air Emission Standards for Tanks, Surface 62 FR 64636, 12/8/97 ...... 9 VAC §§ 20–60–18, 20–60–264 A, 20–60–265 A Impoundments, and Containers (Revision Checklist and 20–60–270 A 163). Kraft Mill Stream Stripper Condensate Exclusion (Re- 63 FR 18504, 4/15/98 ...... 9 VAC §§ 20–60–18 and 20–60–261 A vision Checklist 164). LDR Phase IV—Treatment Standards for Metal 63 FR 28556, 5/26/98 ...... 9 VAC §§ 20–60–18 and 20–60–268 A Wastes and Mineral Processing Wastes (Revision Checklist 167A).

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TABLE 1.—VIRGINIA’S ANALOGS TO THE FEDERAL REQUIREMENTS—Continued

Description of Federal requirement (Revision Federal Register Analogous Virginia authority checklists 1)

LDR Phase IV—Hazardous Soils Treatment Stand- 63 FR 28556, 5/26/98 ...... 9 VAC §§ 20–60–18 and 20–60–268 A ards and Exclusions (Revision Checklist 167B). 167C—LDR Phase IV—Corrections (Revision Check- 63 FR 28556, 5/26/98 ...... 9 VAC §§ 20–60–18 and 20–60–268 A list 167C). 63 FR 31266, 6/8/98 ...... Mineral Processing Secondary Materials Exclusion 63 FR 28556, 5/26/98 ...... 9 VAC § 20–60–18 and 20–60–261 A (Revision Checklist 167D). Bevill Exclusion Revisions and Clarification (Revision 63 FR 28556, 5/26/98 ...... 9 VAC §§ 20–60–18 and 20–60–261 A Checklist 167E). Hazardous Waste Combustors Revised Standards 63 FR 33782, 6/19/98 ...... 9 VAC § 20–60–18, 20–60–261 A and 20–60–270 A (Revision Checklist 168).

RCRA Cluster IX

Petroleum Refining Process Wastes (Revision 63 FR 42110, 8/6/98 ...... 9 VAC §§ 20–60–18, 20–60–261 A, 20–60–266 A Checklist 169). 63 FR 54356, 10/9/98 ...... and 20–60–268 A Land Disposal Restrictions Phase IV—Zinc Micro- 63 FR 46332, 8/31/98 ...... 9 VAC §§ 20–60–18 and 20–60–268 A nutrient Fertilizers, Administrative Stay (Revision Checklist 170). Emergency Revision of the Land Disposal Restric- 63 FR 47410, 9/4/98 ...... 9 VAC §§ 20–60–18 and 20–60–268 A tions (LDR) Treatment Standards for Listed Haz- ardous Wastes from Carbamate Production (Revi- sion Checklist 171). Land Disposal Restrictions Phase IV—Extension of 63 FR 48124, 9/9/98 ...... 9 VAC §§ 20–60–18 and 20–60–268 A Compliance Date for Characteristic Slags (Revi- sion Checklist 172). Land Disposal Restrictions; Treatment Standards for 63 FR 51254, 9/24/98 ...... 9 VAC §§ 20–60–18 and 20–60–268 A Spent Potliners from Primary Aluminum Reduction (K088); Final Rule (Revision Checklist 173). Post-Closure Requirements and Closure Process 63 FR 56710, 10/22/98 ...... 9 VAC §§ 20–60–18, 20–60–264 A, 20–60–265 A (Revision Checklist 174). and 20–60–270 A HWIR-Media (Revision Checklist 175) ...... 63 FR 65874, 11/30/98 ...... 9 VAC §§ 20–60–18, 20–60–260 A, 20–60–261 A, 20–60–264 A, 20–60–265 A, 20–60–268 A, 20– 60–270 A and 20–60–270 B 14 Note: At 9 VAC 20–60–270 B 14, Virginia clarifies that the EPA appeal rights and procedures re- lated to remedial action plan (RAP), as specified in 40 CFR 270.155, are not incorporated into the Virginia regulations. Appeals of actions related to RAPs are governed by Virginia’s Administrative Process Act, Title 2.2, Chapter 40, §§ 2.2–4000 through 2.2–4033, Code of Virginia. Universal Waste Rule—Technical Amendments (Re- 63 FR 71225, 12/24/98 ...... 9 VAC § 20–60–18, 20–60–266 A and 20–60–273 A vision Checklist 176). Organic Air Emission Standards: Clarification and 64 FR 3382, 1/21/99 ...... 9 VAC §§ 20–60–18, 20–60–262 A, 20–60–264 A Technical Amendments (Revision Checklist 177). and 20–60–265 A Petroleum Refining Process Wastes—Leachate Ex- 64 FR 6806, 2/11/99 ...... 9 VAC §§ 20–60–18 and 20–60–261 A emption (Revision Checklist 178). Land Disposal Restrictions Phase IV—Technical Cor- 64 FR 25408, 5/11/99 ...... 9 VAC §§ 20–60–18, 20–60–261 A, 20–60–262 A rections and Clarifications to Treatment Standards and 20–60–268 A (Revision Checklist 179). Test Procedures for the Analysis of Oil and Grease 64 FR 26315, 5/14/99 ...... 9 VAC §§ 20–60–18 and 20–60–260 A and Non-Polar Material (Revision Checklist 180).

RCRA Cluster X

Universal Waste Rule: Specific Provisions for Haz- 64 FR 36466, 7/6/99 ...... 9 VAC §§ 20–60–18, 20–60–260 A, 20–60–261 A, ardous Waste Lamps (Revision Checklist 181). 20–60–264 A, 20–60–265 A, 20–60–268 A, 20– 60–270 A, 20–60–273 A, and 20–60–273 B.3.a Hazardous Air Pollutant Standards for Combustors, 64 FR 52828, 9/30/99 ...... 9 VAC §§ 20–60–18, 20–60–260 A, 20–60–261 A, Miscellaneous Units, and Secondary Lead Smelt- 64 FR 63209, 11/19/99 ...... 20–60–264 A, 20–60–265 A, 20–60–266 A and ers; Clarification of BIF Requirements; Technical 20–60–270 A Correction to Fast-track Rule (Revision Checklist 182). Land Disposal Restrictions Phase IV—Technical Cor- 64 FR 56469, 10/20/99 ...... 9 VAC §§ 20–60–18, 20–60–261 A, 20–60–262 A rections (Revision Checklist 183). and 20–60–268 A Accumulation Time for Waste Water Treatment 65 FR 12378, 3/8/00 ...... 9 VAC §§ 20–60–18 and 20–60–262 A Sludges (Revision Checklist 184). Vacatur of Organobromine Production Waste Listings 65 FR 14472, 3/17/00 ...... 9 VAC §§ 20–60–18, 20–60–261 A and 20–60–268 (Revision Checklist 185). A

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TABLE 1.—VIRGINIA’S ANALOGS TO THE FEDERAL REQUIREMENTS—Continued

Description of Federal requirement (Revision Federal Register Analogous Virginia authority checklists 1)

Petroleum Refining Process Wastes—Clarification 65 FR 36365, 6/8/00 ...... 9 VAC §§ 20–60–18, 20–60–261 A and 20–60–268 (Revision Checklist 187). A

RCRA Cluster XI

Hazardous Air Pollutant Standards; Technical correc- 65 FR 42292, 7/10/00 ...... 9 VAC §§ 20–60–18, 20–60–261 A, 20–60–264 A tions (Revision Checklist 188). 66 FR 24270, 5/14/01 ...... and 20–60–270 A Chlorinated Aliphatics Listing and LDRs for Newly 65 FR 67068, 11/8/00 ...... 9 VAC §§ 20–60–18, 20–60–261 A and 20–60–268 Identified Wastes (Revision Checklist 189). A Land Disposal Restrictions Phase IV—Deferral for 65 FR 81373, 12/26/00 ...... 9 VAC §§ 20–60–18 and 20–60–268 A PCBs in Soil (Revision Checklist 190). Mixed Waste Rule (Revision Checklist 191) ...... 66 FR 27218, 5/16/01 ...... 9 VAC §§ 20–60–18 and 20–60–266 A Mixture and Derived-From Rules Revisions (Revision 66 FR 27266, 5/16/01 ...... 9 VAC §§ 20–60–18 and 20–60–261 A Checklist 192A). Land Disposal Restrictions Correction (Revision 66 FR 27266, 5/16/01 ...... 9 VAC §§ 20–60–18 and 20–60–268 A Checklist 192B). Change of Official EPA Mailing Address (Revision 66 FR 34374, 6/28/01 ...... 9 VAC §§ 20–60–18 and 20–60–260 A Checklist 193).

PROJECT XL

Project XL Site-Specific Rulemaking for Merck & Co., 62 FR 59621, 10/8/97 ...... 9 VAC §§ 20–60–18, 20–60–264 and 20–60–265 A Inc., Stonewall Plant, Elkton, VA. 1 A Revision Checklist is a document that addresses the specific changes made to the Federal regulations by one or more related final rules published in the Federal Register. EPA develops these checklists as tools to assist States in developing their authorization applications and in documenting specific State analogs to the Federal regulations. For more information see EPA’s RCRA State Authorization Web page at http:// www.epa.gov/epaoswer/hazwaste/state. 2 A ‘‘RCRA Cluster’’ is a set of Revision Checklists for Federal rules promulgated between July 1 and June 30 of any given year.

2. Additional Requirements for lamp regulations, which provide for than the corresponding Federal Universal Waste Handlers of Hazardous lamp crushing. regulations. Waste Lamps 3. Miscellaneous Changes Title 9, Virginia Administrative Code (9 In the preamble of the July 6, 1999 In addition to adopting Federal VAC) §§ 20–60–14 B 3 through B6; Universal Waste Rule for hazardous program revisions by means of updating 20–60–17 A; 20–60–20 through 20– waste lamps (64 FR 36466 et seq.), EPA the effective date of the incorporation by 60–90; 20–60–124 A & B; 20–60–260 stated that the Agency will consider reference of the Code of Federal B 3 b; 20–60–260 B 8 and B 9; 20–60– authorization of State programs that Regulations to July 1, 2001, Virginia has 261 B 5*, 20–60–262 B 4* and 20–60– include provisions for controlling the made various additional regulatory 262 B 6 and B 7; 20–264 B 5*, 20–60– treatment or crushing of universal waste revisions since its first program revision 264 B 7; 20–60–264 B 15 a*; 20–60– lamps, if the State program can be application. Virginia is seeking 264 B 16; 20–60–264 B 17; 20–60–265 shown to be equivalent to the Federal authorization for these miscellaneous B 6*; 20–60–265 B 7; 20–60–265 B 9; prohibition (see p. 36478, column 1). changes, which became effective March 20–60–265 B 18; 20–60–266 B 3; 20– Virginia has adopted and is seeking 13, 2002. Among these changes, Virginia 60–270 A; 20–60–270 B 5; 20–60–270 authorization for requirements at 9 VAC reorganized its permit procedures by B 6 (except first sentence); 20–60–270 sections 20–60–273.B.3.b and 20–60– deleting Part XI (9 VAC 20–60–960 B 7; 20–60–270 B 8; 20–60–270 B 9 273.B.3.c which allow universal waste through 9 VAC 20–60–1250) and introductory paragraph; 20–60–279 B handlers to crush universal waste lamps expanding, as appropriate, the coverage 9 a*; 20–60–270 B 9 b; 20–60–270 B at the site of generation in order to of 9 VAC 20–60–270. Virginia has also 10*; 20–60–270 B 11*; 20–60–270 B reduce their volume before adopted the Federal provisions of 40 12*; 20–60–270 B 13; 20–60–273 B 2; transportation. Virginia’s lamp crushing CFR 260.30 and 260.31 at 9 VAC 20–60– 20–60–315 B & C; 20–60–315 H; 20– regulations include technical 1390 A 2 and 20–60–1390 B 60–328 A through D; 20–60–1410 A requirements for controlling emissions respectively, which provide for a and B; 20–60–1420 B and C; 20–60– of hazardous constituents to levels petition process for waste variances 1430; and 20–60–1435. established by the Federal Occupational from classification as a solid waste; and Safety and Health Administration revised various cross-references, A further discussion of Virginia’s (OSHA), and specific operational principally to conform to the deletion of miscellaneous regulatory changes is recordkeeping requirements. EPA has Part XI. Additional miscellaneous found in the following authorization reviewed Virginia’s universal waste changes are listed following this revision application documents for lamp regulations and has determined paragraph. Regulatory citations Virginia: (1) ‘‘Demonstration of that the State’s requirements are at least annotated with an asterisk are deemed Adequate Authority for Virginia as protective as, and therefore to be more stringent than the Federal Hazardous Waste Management Program equivalent to, the Federal prohibition on program. EPA has evaluated the Revisions from Program Revision I the treatment of universal waste lamps. miscellaneous changes described in this through June 30, 2001: Program Therefore, EPA grants Virginia final section and has determined that they are Revision II’’ and (2) ‘‘Program authorization for its universal waste consistent with and no less stringent Description, Revision II, 2002.’’

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H. Where Are the Revised Virginia Section A. Why are Revisions to State 8. Executive Order 13211: Actions That Rules Different From the Federal Rules? Programs Necessary?). Therefore, this Significantly Affect Energy Supply, Virginia’s hazardous waste program rule complies with applicable executive Distribution, or Use contains several provisions which are orders and statutory provisions as This rule is not subject to EO 13211 more stringent than the RCRA program follows. because it is not a significant regulatory as codified in the July 1, 2001 edition 1. Executive Order 12866: Regulatory action as defined in EO 12866. of title 40 of the Code of Federal Planning Review 9. National Technology Transfer Regulations (CFR). These more stringent Advancement Act provisions are part of the Federally- The Office of Management and Budget authorized program and are, therefore, has exempted this rule from its review EPA approves State programs as long Federally-enforceable. The specific under Executive Order (EO) 12866. as they meet criteria required by RCRA, more stringent provisions are noted in so it would be inconsistent with Section G.3. 2. Paperwork Reduction Act applicable law for EPA, in its review of a State program, to require the use of I. Who Handles Permits After This This rule does not impose an information collection burden under the any particular voluntary consensus Authorization Takes Effect? standard in place of another standard Paperwork Reduction Act. After authorization, Virginia will that meets the requirements of RCRA. issue permits for all the provisions for 3. Regulatory Flexibility Act Thus, Section 12(d) of the National which it is authorized and will Technology Transfer and Advance Act administer the permits it issues. EPA After considering the economic does not apply to this rule. will continue to administer any RCRA impacts of today’s rule on small entities hazardous waste permits or portions of under the Regulatory Flexibility Act, I 10. Congressional Review Act permits which it issued prior to the certify that this rule will not have a EPA will submit a report containing effective date of this authorization. Until significant economic impact on a this rule and other information required such time as formal transfer of EPA substantial number of small entities. by the Congressional Review Act (5 U.S.C. 801 et seq.) to the U.S. Senate, permit responsibility to Virginia occurs 4. Unfunded Mandates Reform Act and EPA terminates its permit, EPA and the U.S. House of Representatives, and Virginia agree to coordinate the Because this rule approves pre- the Comptroller General of the United administration of permits in order to existing requirements under state law States prior to publication in the maintain consistency. EPA will not and does not impose any additional Federal Register. A major rule cannot issue any additional new permits or enforceable duty beyond that required take effect until 60 days after it is new portions of permits for the by state law, it does not contain any published in the Federal Register. This provisions listed in Section G after the unfunded mandate or significantly or action is not a ‘‘major rule’’ as defined effective date of this authorization. EPA uniquely affect small governments, as by 5 U.S.C. 804(2). This action will be will continue to implement and issue described in the Unfunded Mandates effective on May 12, 2003. permits for HSWA requirements for Reform Act. List of Subjects in 40 CFR Part 271 which Virginia is not yet authorized. 5. Executive Order 13132: Federalism Environmental protection, J. How Does Today’s Action Affect Administrative practice and procedure, Indian Country (18 U.S.C. 115) in EO 13132 does not apply to this rule Confidential business information, Virginia? because it will not have federalism Hazardous waste, Hazardous waste Virginia is not seeking authority to implications (i.e., substantial direct transportation, Indian lands, operate its program on Indian lands, effects on the States, on the relationship Intergovernmental relations, Penalties, since there are no Federally-recognized between the national government and Reporting and recordkeeping Indian Lands in Virginia. the States, or on the distribution of requirements. power and responsibilities among the K. What Is Codification and Is EPA various levels of government). Authority: This action is issued under the Codifying Virginia’s Hazardous Waste authority of sections 2002(a), 3006 and Program as Authorized in This Rule? 6. Executive Order 13175: Consultation 7004(b) of the Solid Waste Disposal Act as and Coordination With Indian Tribal amended, 42 U.S.C. 6912(a), 6926, 6974(b). Codification is the process of placing Governments Dated: March 5, 2003. the State’s statutes and regulations that Thomas Voltaggio, comprise the State’s authorized EO 13175 does not apply to this rule hazardous waste program into the Code because it will not have tribal Acting Regional Administrator, EPA Region III. of Federal Regulations. EPA does this by implications (i.e., substantial direct referencing the authorized State rules in effects on one or more Indian tribes, on [FR Doc. 03–6109 Filed 3–12–03; 8:45 am] 40 CFR part 272. EPA reserves the the relationship between the Federal BILLING CODE 6560–50–P amendment of 40 CFR part 272, subpart Government and Indian tribes, or on the VV, for this authorization of Virginia’s distribution of power and program changes until a later date. responsibilities between the Federal FEDERAL COMMUNICATIONS Government and Indian tribes). COMMISSION L. Statutory and Executive Order Reviews 7. Executive Order 13045: Protection of 47 CFR Parts 2 and 25 Statutory and Executive Order Reviews Children from Environmental Health & [ET Docket No. 00–258 and IB Docket No. Safety Risks This rule only authorizes hazardous 99–81; FCC 03–16] waste requirements pursuant to RCRA This rule is not subject to EO 13045 Advanced Wireless Service 3006 and imposes no requirements because it is not economically other than those imposed by State law significant and it is not based on health AGENCY: Federal Communications (see SUPPLEMENTARY INFORMATION, or safety risks. Commission.

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ACTION: Final rule. with MSS, to reflect the revised MSS redistribute such spectrum or make it bands. The Commission created two available to new entrants after SUMMARY: This document reallocate new non-Federal Government footnotes achievement of each of our system portions of the frequency band currently that make incumbent BAS and cable implementation milestones. used by the Mobile-Satellite Service television relay service operations that 3. Because we are revising the (MSS) to provide additional spectrum are secondary to MSS also secondary to allocated spectrum for MSS and for Fixed and Mobile Services, and deny new Fixed and Mobile services after modifying the amount of spectrum that Cellular Telecommunications and prescribed cut-off dates. Finally, we will constitute a Selected Assignment, Internet Association’s petition for conclude that some abandoned 2 GHz we have also modified how Selected reconsideration. This action furthers the spectrum recently recaptured as a result Assignments are to be located in the Commission’s efforts to identify and of the initial MSS milestone review will revised MSS bandwidth. In the 2 GHz reallocate spectrum that can be used to be reassigned to the authorized MSS MSS R&O, we have determined that the promote the development and operators that remain when we MSS band plan would be divided into deployment of advanced wireless complete the initial milestone review. equal segments based on the number of services, including those commonly 2. The 30 megahertz of spectrum that licensed MSS systems. This incremental associated with ‘‘3G’’ wireless was reallocated from MSS comes from spacing approach allows MSS licensees applications. two sources: 14 megahertz of spectrum to identify Selected Assignments DATES: Effective April 14, 2003. that was not assigned to any of the MSS working from either the bottom or the top of the band without requiring FOR FURTHER INFORMATION CONTACT: licensees and 16 megahertz of spectrum assignments to be selected in sequential Jamison Prime, Office of Engineering (of the 21 megahertz) that had been order. In order to maintain this and Technology, (202) 418–7474. abandoned at the time the Third R&O flexibility, the plan for each band will was adopted, as a result of MSS SUPPLEMENTARY INFORMATION: This is a be based on dividing the revised MSS licensees not meeting initial milestones. summary of the Commission’s Third allocation in each band by the number The International Bureau has cancelled Report and Order and Memorandum of MSS licensees remaining when we three MSS authorizations, thereby Opinion and Order, ET Docket No. 00– complete the initial MSS milestone recapturing 21 megahertz of spectrum. 258 and IB Docket No. 99–81, FCC 03– review. Thus, MSS licensees will Sixteen megahertz of this recaptured 16, adopted January 29, 2003, and choose Selected Assignments as an released February 10, 2003. The full text spectrum, as well as the 14 megahertz integer multiple of this amount from of this document is available for of unassigned spectrum, will be either band edge. We have modified, inspection and copying during regular reallocated immediately for Fixed and pursuant to section 316 of the business hours in the FCC Reference Mobile services. Relying on unassigned Communications Act, 47 U.S.C. 316, Center (Room CY–A257), 445 12th and abandoned spectrum as the basis for and consistent with our decisions here, Street, SW., Washington, DC 20554. The the reallocation is least disruptive to the the 2 GHz MSS authorizations to complete text of this document also may MSS licensees. Further, the initial MSS increase the amount of spectrum for be purchased from the Commission’s milestone review, which is not yet Selected Assignments, to require that a copy contractor, Qualex International, completed, has already made available Selected Assignment be located within 445 12th Street, SW., Room, CY–B402, an additional 5 megahertz of abandoned the revised MSS allocation, and to Washington, DC 20554. The full text spectrum that we are not reallocating for require that a Selected Assignment be may also be downloaded at: new services. We note that the MSS chosen such that the band edge of the www.fcc.gov. Alternative formats are entities have asserted the need for assignment is an integer multiple of the available to persons with disabilities by access to more than 3.5 megahertz of revised value from the band edge. We contacting Brian Millin at (202) 418– spectrum in each band for their Selected have also delegated authority to the 7426 or TTY (202) 418–7365. Assignments. We thus conclude that the International Bureau to issue revised public interest would be served by Summary of the Third Report and authorizations, consistent with the redistributing abandoned 2 GHz decisions in this Third Report and Order and Memorandum Opinion and spectrum recently recaptured as a result Order Order, when the initial milestone of the initial MSS milestone review, review is completed. When the 1. In the Third Report and Order, the above the 16 megahertz being authorizations are modified, the MSS Commission reallocated 30 megahertz of reallocated, to the authorized MSS entities, can follow current procedures spectrum in the 2 GHz MSS band for operators that remain when we for notifying the Commission of their Fixed and Mobile services on a primary complete the initial milestone review. Selected Assignments and their basis and preserved the remaining 40 Thus, it is possible that more than 5 selections will be put on public notice. megahertz of spectrum for Mobile- megahertz of abandoned spectrum may 4. In deciding which segments of the Satellite Service (MSS) at this time. The be available for redistribution when the MSS spectrum should be reallocated for Commission reallocated 15 megahertz initial MSS milestone review is Fixed and Mobile services, we recognize from the MSS uplink band, specifically completed. We further note that the that the record is split on whether we the 1990–2000 MHz and 2020–2025 MSS milestone review is an ongoing should reallocate spectrum that overlaps MHz band segments, and 15 megahertz process that spans several years, and it the global MSS allocation, which from the MSS downlink band, is possible that not all currently consists of paired 30 megahertz bands at specifically the 2165–2180 MHz band authorized MSS networks will be 1980–2110 MHz and 2170–2200 MHz. segment. We modified the Table of deployed. As we previously stated in 2 The U.S. MSS allocation, which consists Allocations to provide for Fixed and GHz MSS R&O, 65 FR 59140, Oct. 4, of two paired 35 megahertz bands, Mobile services in these bands on a co- 2000, we have not established nor do we overlaps 20 megahertz of the primary basis. In addition, we also do so here any policy or rule regarding international allocation in the lower modified footnotes NG 156 and NG 168 the use of additional abandoned uplink band (1990–2010 MHz) and all of of the U.S. Table of Frequency spectrum that may result after future the 30 megahertz of the international Allocations, concerning Fixed and MSS milestone reviews are completed. allocation in the upper downlink band Mobile service status in bands shared Instead, we will evaluate whether to (2170–2200 MHz). After careful

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consideration of the record, we and supportive of the benefits of global separate proceeding. We intend to conclude that, on balance, the benefits spectrum harmonization, when address the relocation issues well in to the public of providing additional appropriate. advance of the September 6, 2003, spectrum for Fixed and Mobile services 6. In the 2165–2200 MHz band, we expiration of the initial two-year that overlaps the international 2 GHz balanced the MSS and terrestrial mandatory negotiation period for Phase MSS band outweigh the impact on MSS. services needs by reallocating a 15 1 of the relocation plan between MSS Our decision is to reallocate MSS megahertz block at 2165–2180 MHz. and BAS. spectrum in a way that will allow new This reallocation will minimize the 8. This Second Memorandum Opinion entrants to take advantage of economies impact on MSS, as all of the remaining and Order addresses a petition for rule of scale in developing and deploying 20 megahertz domestic allocation will making filed by CTIA on May 18, 2001, new services while maintaining overlap with the current international requesting that the 2 GHz MSS bands be sufficient international MSS spectrum. MSS downlink allocation—and, thus, 30 reallocated for other uses (such as 5. In the 1990–2025 MHz band, we of the 40 megahertz of remaining MSS terrestrial wireless services) and also have reallocated from the current MSS spectrum will overlap with the global asking that the Commission withhold allocation a 10 megahertz block at 1990– allocation. We believe that MSS grant of 2 GHz MSS licenses. In the 2000 MHz, which is contiguous with the licensees should not be significantly Further Notice, we granted the petition existing Broadband PCS allocation at impaired in providing satellite services insofar as we proposed to reallocate 10– 1930–1990 MHz, and a 5 megahertz in this band. We note that, as a result 14 megahertz of spectrum for AWS, and of our previous decision in this docket, block at 2020–2025 MHz. Because the denied it insofar as it requested 45 megahertz of contiguous spectrum, 10 megahertz block is contiguous with reallocation of the entire 2 GHz MSS from 2110–2155 MHz, will be available the Broadband PCS band, this spectrum band and delaying of the licensing of for AWS. We also have proposed to could provide needed growth spectrum MSS systems in the band. We stated that make the adjacent bands at 2155–2160 for PCS providers, as well as facilitate our actions in the Further Notice would and 2160–2165 MHz available for AWS. new AWS equipment development and better serve the public with respect to We note that our decision here to deployment. This reallocation will these issues and was consistent with the reallocate the adjacent MSS spectrum at reduce by 10 megahertz the current 20 International Bureau’s granting of the 2165–2180 MHz is consistent with the megahertz available for the international MSS licenses on July 17, 2001. In its majority of the AWS proponents who MSS uplink allocation. While we petition for reconsideration, CTIA favor reallocating MSS spectrum claims we made an error by acting on recognize that globally harmonized adjacent to the 2110–2165 MHz band. its petition without first placing it on spectrum is an important resource, we Contiguous spectrum would make it public notice, and asks that we vacate share Cellular Telecommunications and easier to accommodate multiple our decision to reject its petition for Internet Association’s concerns licensees using larger spectrum blocks rulemaking, place the petition on public regarding potential interference to throughout this band. Further, a flexible notice, and consider it ab initio. CTIA existing PCS operations at 1930–1990 allocation at 2110–2165 MHz would also claims that we failed to articulate MHz. We believe that in this instance, overlap to a large extent the a reasoned decision for rejecting its these interference concerns outweigh international allocation for a terrestrial request and, further, that we could not the benefits of increased global component of advanced services at reasonably rely on the grant of the MSS harmonized spectrum. We find that we 2110–2170 MHz and thus will promote can accommodate the international the timely introduction of new licenses because that action prejudged needs of 2 GHz MSS licensees in the equipment and services in this our consideration of CTIA’s petition. remaining 10 megahertz (uplink) + 20 spectrum. 9. Although we did not place CTIA’s megahertz (downlink) of overlapping 7. As a consequence of our decision petition on public notice, our decision international spectrum. Not all of the to reallocate the 1990–2000/2020–2025/ in that regard did not prejudice CTIA. eight authorized MSS networks will be 2165–2180 MHz bands, we note that We note that various parties filed deployed, not all of the proposed MSS coordination of satellite and terrestrial responsive comments addressing networks will be providing global use with Canada and Mexico will be reallocation of the entire 2 MSS GHz service, and most MSS licensees necessary. Finally, we are not reaching band in IB Docket No. 99–81, which propose to operate throughout the decisions here on several other issues demonstrates that the public was currently allocated band (2000–2020 raised in the Further Notice, 66 FR provided the opportunity to submit MHz). The remaining MSS entities will 47618, September 13, 2001, such as the comment on the reallocation question be able to adapt their frequency use consolidation of MSS assignments and raised by CTIA’s petition, and did so. within the U.S. to the remaining BAS and FS relocation issues. We will Moreover, the Commission has already allocated spectrum (2000–2020 MHz), address those issues in further raised and duly considered this and use any spectrum within the proceedings. We note, for example, that reallocation question. The same day the international allocation (1980–2010 relocating incumbent BAS operations in Commission adopted the Further Notice MHz) outside the U.S. Any newly the 1990–2025 MHz band will be further that considered the reallocation of some authorized MSS networks could be built complicated by our decision here. As MSS spectrum, it initiated a separate to accommodate the revised MSS we stated in the Further Notice when proceeding to explore whether MSS allocation, assuming that sharing with discussing possible reallocation of licensees should be afforded additional incumbent MSS licensees is possible. spectrum in the 1990–2025 MHz band, flexibility. Together, these proceedings We conclude that our decision to reduce the relocation of BAS from any portion explored the larger issue of MSS use the amount of globally harmonized MSS of the band would be shared between that is also reflected in CTIA’s petition. spectrum that will be available in the new MSS entrants and other new The Third R&O we adopted concludes United States is appropriate at this time entrants in the band. Although we that a portion of the MSS spectrum and consistent with the current conclude that this principle would should be reallocated to support AWS, spectrum requirements for the global apply as a consequence of our but rejects a complete reallocation of the portion of the 2 GHz MSS industry. reallocation decision, we will address band. Accordingly, CTIA’s original Despite this action, we remain cognizant fully BAS relocation issues in a future petition for rule making is now moot,

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and we deny its petition for AWS) in the 1990–2000 MHz, 2020– fewer then 50,000.14 The Census Bureau reconsideration. 2025 MHz, and 2165–2180 MHz bands. estimates that this ratio is approximately accurate for all Final Regulatory Flexibility Analysis Summary of Significant Issues Raised governmental entities. Thus, of the by Public Comments in Response to the 10. As required by the Regulatory 85,006 governmental entities, we IRFA Flexibility Act (RFA) 1 an Initial estimate that 81,600 (96%) are small Regulatory Flexibility Analysis (IRFA) 13. There were no comments filed entities. was incorporated in the Notice of that specifically addressed the rules and Radiotelephone Operators. The Proposed Rulemaking and Order policies proposed in the IRFA. Commission has not developed service 2 (NPRM), as well as the Memorandum Description and Estimate of the Number rules for AWS spectrum, nor has it Opinion and Order and Further Notice of Small Entities to Which the Rules attempted to categorize potential of Proposed Rule Making (Further Will Apply licensees for this spectrum. However, NPRM).3 The Commission sought because many of the comments we written public comments on the 14. The RFA directs agencies to received in support of our efforts to proposals in the NPRM and Further provide a description of, and, where allocate spectrum for AWS were NPRM, including comment on each feasible, an estimate of, the number of submitted by commercial IRFA. This present Final Regulatory small entities that may be affected by radiotelephone operators and because 6 Flexibility Analysis (FRFA) conforms to the rules adopted herein. The RFA licensees of AWS-like bands in other the RFA.4 generally defines the term ‘‘small countries include incumbent entity’’ as having the same meaning as commercial radiotelephone operators, Need for, and Objectives of, the Third the terms ‘‘small business,’’ ‘‘small we believe that there is a high Report and Order organization,’’ and ‘‘small governmental likelihood that the class of AWS 11. The Third Report and Order jurisdiction.’’ 7 In addition, the term licensees may ultimately consist of one (Third R&O) continues our efforts to ‘‘small business’’ has the same meaning or more radiotelephone operator. allocate spectrum that can be used for as the term ‘‘small business concern’’ Therefore, we examine this category in the provision of advanced wireless under the Small Business Act.8 A greater depth. The SBA has developed services (AWS) to the public, which in ‘‘small business concern’’ is one which: a small business size standard for small turn supports our obligations under (1) Is independently owned and businesses in the category ‘‘Cellular and Section 706 of the 1996 operated; (2) is not dominant in its field Other Wireless Telecommunications.’’ 15 Telecommunication Act 5 and, more of operation; and (3) satisfies any Under that SBA category, a business is generally, serves the public interest by additional criteria established by the small if it has 1,500 or fewer 9 promoting rapid and efficient radio Small Business Administration (SBA). employees.16 According to the Bureau communication facilities. 15. A small organization is generally of the Census, only twelve firms from a 12. The Third R&O discusses the need ‘‘any not-for-profit enterprise which is total of 1238 cellular and other wireless independently owned and operated and telecommunications firms operating for spectrum allocations of sufficient 10 size and with particular characteristics is not dominant in its field.’’ during 1997 had 1,000 or more so as to allow for the provision of AWS. Nationwide, as of 1992, there were employees.17 Therefore, even if all approximately 275,801 small twelve of these firms were cellular Specifically, it evaluates spectrum that 11 was formerly allocated to the Mobile- organizations. ‘‘Small governmental telephone companies, nearly all cellular Satellite Service (MSS). The jurisdiction’’ generally means carriers were small businesses under the ‘‘governments of cities, counties, towns, Commission previously concluded that SBA’s definition. In addition, we note townships, villages, school districts, or 2 GHz MSS licensees could operate that there are 1807 cellular licenses; special districts, with a population of using a smaller amount of spectrum however, a cellular licensee may own less than 50,000.’’ 12 As of 1992, there than that which had previously been several licenses. According to the most were approximately 85,006 allocated. The Third R&O allocates recent Trends in Telephone Service governmental entities in the United spectrum for fixed and mobile services data, 858 carriers reported that they States.13 This number includes 38,978 (which could be made available for were engaged in the provision of either counties, cities, and towns; of these, cellular service, Personal 37,566, or 96%, have populations of 1 See 5 U.S.C. 603. The RFA (codified at 5 U.S.C. Communications Service (PCS), or 601–612) has been amended by the Small Business Specialized Mobile Radio telephony 6 Regulatory Enforcement Fairness Act of 1996 5 U.S.C. 604(a)(3). services, which are placed together in (SBREFA), Pub. L. 104–121, Title II, 110 Stat. 857 7 5 U.S.C. 601(6). (1996). 8 5 U.S.C. 601(3) (incorporating by reference the that data. We have estimated that 291 of 2 Amendment of Part 2 of the Commission’s Rules definition of ‘‘small-business concern’’ in the Small these are small under the SBA small to Allocate Spectrum Below 3 GHz for Mobile and Business Act, 15 U.S.C. 632). Pursuant to 5 U.S.C. business size standard.18 Accordingly, Fixed Services to Support the Introduction of New 601(3), the statutory definition of a small business based on this data, we estimate that not Advanced Wireless Services, Including Third applies ‘‘unless an agency, after consultation with more than 291 radiotelephone operators Generation Wireless Systems, ET Docket No. 00– the Office of Advocacy of the Small Business 258, Notice of Proposed Rulemaking and Order, 16 Administration and after opportunity for public FCC Rcd 596 (2001), 66 FR 18740, April 11, 2001. comment, establishes one or more definitions of 14 Id. 3 Amendment of Part 2 of the Commission’s Rules such term which are appropriate to the activities of 15 13 CFR 121.201, North American Industry to Allocate Spectrum Below 3 GHz for Mobile and the agency and publishes such definition(s) in the Classification System (NAICS) code 513322. Fixed Services to Support the Introduction of New Federal Register.’’ 16 Id. 9 Advanced Wireless Services, including Third 15 U.S.C. 632. 17 U.S. Department of Commerce, U.S. Census Generation Wireless Systems, ET Docket No. 00– 10 5 U.S.C. 601(4). Bureau, 1997 Economic Census, Information— 258, ET Docket No. 95–18, and IB Docket No. 99– 11 Department of Commerce, U.S. Bureau of the Subject Series, Establishment and Firm Size, Table 81, Memorandum Opinion and Order, 66 FR 47518, Census, 1992 Economic Census, Table 6 (special 5—Employment Size of Firms Subject to Federal September 13, 2001, and Further Notice of tabulation of data under contract to Office of Income Tax at 64, NAICS code 513322 (October Proposed Rule Making, 16 FCC Rcd 16043 (2001), Advocacy of the U.S. Small Business 2000). 66 FR 47618, September 13, 2001. Administration). 18 See Trends in Telephone Service, Industry 4 See 5 U.S.C. 604. 12 5 U.S.C. 601(5). Analysis and Technology Division, Wireline 5 Section 706 of the Communications Act of 1934, 13 U.S. Dept. of Commerce, Bureau of the Census, Communications Bureau, Table 5.3, page 5–5 (May as amended, codified at 47 U.S.C. 157. ‘‘1992 Census of Governments.’’ 2002).

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would be affected by a decision to make Description of Projected Reporting, involved in the provision of AWS with additional spectrum available for AWS. Recordkeeping, and Other Compliance the likelihood that, at the time of MSS Geostationary, Non-Geostationary Requirements system implementation, no small Orbit, Fixed Satellite, or Mobile Satellite 16. The Third R&O addresses the businesses will be providing MSS. For Service Operators (including 2 GHz MSS possible use of frequency bands below this reason, we believe that the reallocation of spectrum from MSS in systems). The Commission has not 3 GHz to support the introduction of the Third R&O will actually provide developed a definition of small entities new AWS, but does not propose service rules. Thus, the item contains no new small entities with opportunities that applicable to geostationary or non- would have otherwise been unavailable. geostationary orbit, fixed-satellite or reporting, recordkeeping, or other mobile-satellite service operators. The compliance requirements. Report to Congress SBA has developed a small business Steps Taken To Minimize Significant 20. The Commission will send a copy size standard for Satellite Economic Impact on Small Entities, and of the Third Report and Order including Telecommunications Carriers, which Significant Alternatives Considered this FRFA, in a report to be sent to consists of all such companies having 17. The RFA requires an agency to Congress pursuant to the Congressional $12.5 million or less in annual describe any significant alternatives that Review Act.26 In addition, the receipts.19 In addition, a second SBA it has considered in developing its Commission will send a copy of the size standard for Other approach, which may include the Third Report and Order, including this Telecommunications includes ‘‘facilities following four alternatives (among FRFA, to the Chief Counsel for operationally connected with one or others): ‘‘(1) The establishment of Advocacy of the SBA. A copy of the more terrestrial communications differing compliance or reporting Third Report and Order and FRFA (or systems and capable of transmitting requirements or timetables that take into summaries thereof) will also be telecommunications to or receiving account the resources available to small published in the Federal Register.27 entities; (2) the clarification, telecommunications from satellite List of Subjects systems,’’ 20 and also has a size standard consolidation, or simplification of of annual receipts of $12.5 million or compliance and reporting requirements 47 CFR Part 2 under the rule for such small entities; less. According to Census Bureau data Communications equipment. for 1997, there were 324 firms in the (3) the use of performance rather than design standards; and (4) an exemption category Satellite Telecommunications, 47 CFR Part 25 from coverage of the rule, or any part total, that operated for the entire year.21 Communications equipment, thereof, for such small entities.’’ 25 Of this total, 273 firms had annual 18. Providing spectrum to support the Satellites. receipts of $5 million to $9,999,999 and introduction of new advanced mobile Federal Communications Commission. an additional 24 firms had annual and fixed terrestrial wireless services is Marlene H. Dortch, 22 receipts of $10 million to $24,999,990. critical to the continuation of Secretary. Thus, under this size standard, the technological advancement. First and majority of firms can be considered foremost, the Commission believes that Rule Changes small. In addition, according to Census providing for expanded use of the For the reasons discussed in the Bureau data for 1997, there were 439 frequency bands identified in the Third preamble, the Federal Communications firms in the category Satellite R&O in order to allow for a wide range Commission amends 47 CFR parts 2 and Telecommunications, total, that of voice, data, and broadband services 25 to read as follows: operated for the entire year.23 Of this over a variety of mobile and fixed total, 424 firms had annual receipts of networks will provide substantial new PART 2—FREQUENCY ALLOCATIONS $5 million to $9,999,999 and an opportunities for small entities, AND RADIO TREATY MATTERS; additional 6 firms had annual receipts including (but not limited to) small GENERAL RULES AND REGULATIONS of $10 million to $24,999,990.24 Thus, entities that are radiotelephone 1. The authority citation for part 2 under this second size standard, the operators. 19. In prior decisions, we determined continues to read as follows: majority of firms can be considered that MSS operations could exist within small. Authority: 47 U.S.C. 154, 302a, 303, and a 40 megahertz allocation, and this 336, unless otherwise noted. spectrum is not at issue in the current 19 13 CFR 121.201, North American Industry proceeding. Instead, the Third R&O 2. Section 2.106 is amended as Classification System (NAICS) code 517410 addresses the use of 30 megahertz of follows: (formerly 513340). abandoned MSS spectrum (i.e. spectrum a. Revise pages 48 and 49 of the Table. 20 Id. NAICS code 517910 (formerly 513390). available for reallocation because b. In the list of non-Federal 21 U.S. Census Bureau, 1997 Economic Census, licensees either failed to satisfy Government (NG) footnotes, revise Subject Series: Information, ‘‘Receipt Size of Firms Subject to Federal Income Tax: 1997,’’ Table 4, Commission rules pertaining to system footnotes NG156 and NG168 and add NAICS code 517410 (issued Oct. 2000). construction or because they voluntarily footnotes NG177 and NG178. 22 Id. relinquished their authorizations). For The revisions and additions read as 23 U.S. Census Bureau, 1997 Economic Census, this spectrum, we contrast the public follows: Subject Series: Information, ‘‘Receipt Size of Firms benefits of the allocation of AWS and BILLING CODE 6712–01–P Subject to Federal Income Tax: 1997,’’ Table 4, the potential that small entities will be NAICS code 517910 (issued Oct. 2000). 26 See 5 U.S.C. 801(a)(1)(A). 24 Id. 25 5 U.S.C. 603(c)(1)–(c)(4). 27 See 5 U.S.C. 604(b).

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BILLING CODE 6712–01–C

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* * * * * § 25.201 Definitions. March 4, 2003. The full text of this Commission decision is available for Non-Federal Government (NG) * * * * * inspection and copying during normal Footnotes 2 GHz Mobile Satellite Service. A mobile-satellite service that operated in business hours in the FCC Information * * * * * the 2000–2020 MHz and 2180–2200 Center, Portals II, 445 12th Street, SW., NG156 The band 2000–2020 MHz is MHz frequency bands, or in any portion Room CY–A257, Washington, DC 20554. also allocated to the fixed and mobile thereof. The complete text of this decision may services on a primary basis for facilities * * * * * also be purchased from the where the receipt date of the initial 5. Section 25.202 is amended by Commission’s duplicating contractor, application was prior to June 27, 2000, Qualex International, Portals II, 445 and on a secondary basis for all other revising paragraph (a)(4)(ii) to read as follows: 12th Street, SW., Room CY–B402, initial applications. Not later than Washington, DC, 20554, (202) 863–2893, September 6, 2010, the band 2000–2020 § 25.202 Frequencies, frequency tolerance facsimile (202) 863–2898, or via e-mail MHz is allocated to the fixed and mobile and emission limitations. [email protected]. services on a secondary basis. (a) * * * List of Subjects in 47 CFR part 73 * * * * * (4) * * * NG168 The band 2180–2200 MHz is (ii) The following frequencies are Radio, Radio broadcasting. also allocated to the fixed and mobile available for use by the 2 GHz Mobile- Part 73 of title 47 of the Code of services on a primary basis for facilities Satellite Service: 2000–2020 MHz: User- Federal Regulations is amended as where the receipt date of the initial to-Satellite Link; 2180–2200 MHz: follows: application was prior to January 16, Satellite-to-User Link. 1992, and on a secondary basis for all * * * * * PART 73—RADIO BROADCAST other initial applications. Not later than SERVICES September 6, 2010, the band 2180–2200 [FR Doc. 03–6039 Filed 3–12–03; 8:45 am] MHz is allocated to the fixed and mobile BILLING CODE 6712–01–P 1. The authority citation for Part 73 services on a secondary basis. continues to read as follows: * * * * * FEDERAL COMMUNICATIONS Authority: 47 U.S.C. 154, 303, 334 and 336. NG177 In the bands 1990–2000 MHz COMMISSION and 2020–2025 MHz, where the initial § 73.202 [Amended] filing date for facilities in the fixed and 47 CFR Part 73 2. Section 73.202(b), the Table of FM mobile services was prior to June 27, Allotments under Montana, is amended 2000, said facilities shall operate on a [DA 03–587; MB Docket No. 02–127; RM– by adding Roundup, Channel 248A. primary basis and all later-applied-for 10449] Federal Communications Commission. facilities shall operate on a secondary Radio Broadcasting Services; basis to Advanced Wireless Services. John A. Karousos, Roundup, MT Not later than September 6, 2010, all Assistant Chief, Audio Division, Media such facilities in the bands 1990–2000 AGENCY: Federal Communications Bureau. MHz and 2020–2025 MHz shall operate Commission. [FR Doc. 03–6095 Filed 3–12–03; 8:45 am] on a secondary basis to Advanced ACTION: Final rule. BILLING CODE 6712–01–P Wireless Services. NG178 In the band 2165–2180 MHz, SUMMARY: The Audio Division, at the where the initial filing date for facilities request of William J. Edwards, allots FEDERAL COMMUNICATIONS in the fixed and mobile services was Channel 248A at Roundup, Montana, as COMMISSION prior to January 16, 1992, said facilities the community’s first local FM service. shall operate on a primary basis and all Channel 248A can be allotted to 47 CFR Part 73 later-applied-for facilities shall operate Roundup, Montana, in compliance with on a secondary basis to Advanced the Commission’s minimum distance [DA 03–586; MM Docket No. 01–227, RM– Wireless Services. Not later than separation requirements with a site 10255] September 6, 2010, all such facilities in restriction of 1.08 km (0.6 miles) the band 2165–2180 MHz shall operate northeast of Roundup. The coordinates Radio Broadcasting Services; Reydon, on a secondary basis to Advanced for Channel 248A at Roundup, Montana, OK Wireless Services. are 46–26–58 North Latitude and 108– AGENCY: Federal Communications * * * * * 31–44 West Longitude. The Canadian Commission. government has concurred in this PART 25—SATELLITE allotment. A filing window for Channel ACTION: Final rule. COMMUNICATIONS 248A at Roundup, MT, will not be SUMMARY: The Audio Division, at the opened at this time. Instead, the issue of 3. The authority citation for part 25 request of Katherine Pyeatt, allots opening this allotment for auction will continues to read as follows: Channel 264C2 to Reydon, Oklahoma, be addressed by the Commission in a as the community’s first local aural Authority: 47 U.S.C. 701–774. Interprets or subsequent Order. applies sections 4, 301, 302, 303, 307, 309 broadcast service. See 66 FR 48108, DATES: and 332 of the Communications Act, as Effective April 18, 2003. September 18, 2001. Channel 264C2 can amended, 47 U.S.C. Sections 154, 301, 302, FOR FURTHER INFORMATION CONTACT: be allotted to Reydon in compliance 303, 307, 309 and 332, unless otherwise Deborah Dupont, Media Bureau, (202) with the Commission’s minimum noted. 418–2180. distance separation requirements, 4. Section 25.201 is amended by SUPPLEMENTARY INFORMATION: This is a provided there is a site restriction of revising the definition for ‘‘2 GHz synopsis of the Commission’s Report 29.9 kilometers (18.6 miles) south of Mobile-Satellite Service’’ to read as and Order, MB Docket No. 02–127, Reydon. The reference coordinates for follows: adopted February 26, 2003, and released Channel 264C2 at Reydon are 35–23–11

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North Latitude and 99–52–38 West DEPARTMENT OF COMMERCE mt as bycatch to support other Longitude. A filing window for Channel anticipated groundfish fisheries. In 264C2 at Reydon, Oklahoma, will not be National Oceanic and Atmospheric accordance with § 679.20(d)(1)(iii), the opened at this time. Instead, the issue of Administration Regional Administrator finds that this opening a filing window for this directed fishing allowance will soon be channel will be addressed by the 50 CFR Part 679 reached. Consequently, NMFS is Commission in a subsequent order. [Docket No. 021122286–3036–02; I.D. prohibiting directed fishing for pollock 030703A] in Statistical Area 610 of the GOA. DATES: Effective April 18, 2003. Maximum retainable amounts may be ADDRESSES: Federal Communications Fisheries of the Exclusive Economic found in the regulations at § 679.20(e) Commission, 445 Twelfth Street, SW., Zone Off Alaska; Pollock in Statistical and (f). Area 610 of the Gulf of Alaska Washington, DC 20554. Classification FOR FURTHER INFORMATION CONTACT: AGENCY: National Marine Fisheries This action responds to the best Rolanda F. Smith, Media Bureau, (202) Service (NMFS), National Oceanic and available information recently obtained 418–2180. Atmospheric Administration (NOAA), from the fishery. The Assistant Commerce. Administrator for Fisheries, NOAA SUPPLEMENTARY INFORMATION: This is a ACTION: Closure. (AA), finds good cause to waive the synopsis of the Commission’s Report requirement to provide prior notice and and Order, MM Docket Nos. 01–227, SUMMARY: NMFS is prohibiting directed opportunity for public comment adopted February 26, 2003, and released fishing for pollock in Statistical Area pursuant to the authority set forth at 5 March 4, 2003. The full text of this 610 of the Gulf of Alaska (GOA). This U.S.C. 553(b)(B) as such requirement is Commission decision is available for action is necessary to prevent exceeding contrary to the public interest. This inspection and copying during regular the B season allowance of the pollock requirement is contrary to the public business hours at the FCC’s Reference total allowable catch (TAC) for interest as it would delay the closure of Information Center, Portals II, 445 Statistical Area 610 of the GOA. the fishery, lead to exceeding the TAC, Twelfth Street, SW., Room CY–A257, DATES: Effective 1200 hrs, Alaska local and therefore reduce the public’s ability Washington, DC 20554. The complete time (A.l.t.), March 11, 2003, through to use and enjoy the fishery resource. text of this decision may also be 1200 hrs, A.l.t., August 25, 2003. The AA also finds good cause to purchased from the Commission’s FOR FURTHER INFORMATION CONTACT: waive the 30–day delay in the effective duplicating contractor, Qualex Mary Furuness, 907–586–7228. date of this action under 5 U.S.C. International, Portals II, 445 12th Street, SUPPLEMENTARY INFORMATION: NMFS 553(d)(3). This finding is based upon SW., Room CY–B402, Washington, DC manages the groundfish fishery in the the reasons provided above for waiver of 20554, telephone 202–863–2893, GOA exclusive economic zone prior notice and opportunity for public facsimile 202–863–2898, or via e-mail according to the Fishery Management comment. [email protected]. Plan for Groundfish of the Gulf of This action is required by section Alaska (FMP) prepared by the North 679.20 and is exempt from review under List of Subjects in 47 CFR Part 73 Pacific Fishery Management Council Executive Order 12866. under authority of the Magnuson- Authority: 16 U.S.C. 1801 et seq. Radio, Radio broadcasting. Stevens Fishery Conservation and Dated: March 7, 2003. PART 73—RADIO BROADCAST Management Act. Regulations governing Richard W. Surdi, fishing by U.S. vessels in accordance SERVICES Acting Director, Office of Sustainable with the FMP appear at subpart H of 50 Fisheries, National Marine Fisheries Service. CFR part 600 and 50 CFR part 679. 1. The authority citation for part 73 [FR Doc. 03–6103 Filed 3–10–03; 2:27 pm] The B season allowance of the pollock continues to read as follows: TAC in Statistical Area 610 of the GOA BILLING CODE 3510–22–S Authority: 47 U.S.C. 154, 303, 334 and 336. is 2,894 metric tons (mt) as established by the final 2003 harvest specifications DEPARTMENT OF COMMERCE § 73.202 [Amended] for groundfish of the GOA (68 FR 9924, 2. Section 73.202(b), the Table of FM March 3, 2003). In accordance with National Oceanic and Atmospheric Allotments under Oklahoma, is § 679.20(a)(5)(iii)(B) the Administrator, Administration amended by adding Reydon, Channel Alaska Region, NMFS (Regional Administrator) hereby reduces the B 264C2. 50 CFR Part 679 season pollock TAC by 1,228 mt, the Federal Communications Commission. amount of the harvest previously taken [Docket No. 021122286–3036–02; I.D. 030703B] John A. Karousos, in excess of the A season pollock Assistant Chief, Audio Division, Media allowance in Statistical Area 610. The B Fisheries of the Exclusive Economic Bureau. season allowance of pollock TAC in Zone Off Alaska; Pollock in Statistical [FR Doc. 03–6094 Filed 3–12–03; 8:45 am] Statistical Area 610 is 1,666 mt (2,894 Area 630 of the Gulf of Alaska mt minus 1,228 mt). BILLING CODE 6712–01–P In accordance with § 679.20(d)(1)(i), AGENCY: National Marine Fisheries the Regional Administrator has Service (NMFS), National Oceanic and determined that the B season allowance Atmospheric Administration (NOAA), of the pollock TAC in Statistical Area Commerce. 610 has been reached. Therefore, the ACTION: Closure. Regional Administrator is establishing a directed fishing allowance of 1,466 mt, SUMMARY: NMFS is prohibiting directed and is setting aside the remaining 200 fishing for pollock in Statistical Area

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630 of the Gulf of Alaska (GOA). This Alaska Region, NMFS (Regional from the fishery. The Assistant action is necessary to prevent exceeding Administrator) hereby reduces the B Administrator for Fisheries, NOAA the B season allowance of the pollock season pollock TAC by 174 mt, the (AA), finds good cause to waive the total allowable catch (TAC) for amount of the harvest previously taken requirement to provide prior notice and Statistical Area 630 of the GOA. in excess of the A season pollock opportunity for public comment DATES: Effective 1200 hrs, Alaska local allowance in Statistical Area 630. The B pursuant to the authority set forth at 5 time (A.l.t.), March 10, 2003, through season allowance of pollock TAC in U.S.C. 553(b)(B) as such requirement is 1200 hrs, A.l.t., August 25, 2003. Statistical Area 630 is 857 mt (1,031 mt contrary to the public interest. This minus 174 mt). requirement is contrary to the public FOR FURTHER INFORMATION CONTACT: In accordance with § 679.20(d)(1)(i), interest as it would delay the closure of Mary Furuness, 907–586–7228. the Regional Administrator has the fishery, lead to exceeding the TAC, SUPPLEMENTARY INFORMATION: NMFS determined that the B season allowance and therefore reduce the public’s ability manages the groundfish fishery in the of the pollock TAC in Statistical Area to use and enjoy the fishery resource. GOA exclusive economic zone 630 is necessary as incidental catch to The AA also finds good cause to according to the Fishery Management support other anticipated groundfish waive the 30–day delay in the effective Plan for Groundfish of the Gulf of fisheries. Consequently, the Regional date of this action under 5 U.S.C. Alaska (FMP) prepared by the North Administrator establishes the B season 553(d)(3). This finding is based upon Pacific Fishery Management Council directed fishing allowance as zero. In the reasons provided above for waiver of under authority of the Magnuson- accordance with § 679.20(d)(1)(iii), the prior notice and opportunity for public Stevens Fishery Conservation and Regional Administrator finds that this comment. Management Act. Regulations governing directed fishing allowance will soon be This action is required by section fishing by U.S. vessels in accordance reached. Consequently, NMFS is 679.20 and is exempt from review under with the FMP appear at subpart H of 50 prohibiting directed fishing for pollock Executive Order 12866. CFR part 600 and 50 CFR part 679. in Statistical Area 630 of the GOA. Authority: 16 U.S.C. 1801 et seq. The B season allowance of the pollock Maximum retainable amounts may be TAC in Statistical Area 630 is 1,031 found in the regulations at § 679.20(e) Dated: March 7, 2003. metric tons (mt) as established by the and (f). Richard W. Surdi, final 2003 harvest specifications for Acting Director, Office of Sustainable groundfish of the GOA (68 FR 9924, Classification Fisheries, National Marine Fisheries Service. March 3, 2003). In accordance with This action responds to the best [FR Doc. 03–6104 Filed 3–10–03; 2:27 pm] § 679.20(a)(5)(iii)(B) the Administrator, available information recently obtained BILLING CODE 3510–22–S

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Proposed Rules Federal Register Vol. 68, No. 49

Thursday, March 13, 2003

This section of the FEDERAL REGISTER ADDRESSES: Send copies of comments to of State or local funds for such activity) contains notices to the public of the proposed Kenneth R. Payne, Chief; Marketing that is in addition to or different from issuance of rules and regulations. The Programs Branch, Room 2638–S; the Act may not be imposed by a State. purpose of these notices is to give interested Livestock and Seed Program; The Act provides that administrative persons an opportunity to participate in the Agricultural Marketing Service, USDA; proceedings must be exhausted before rule making prior to the adoption of the final rules. STOP–0251; 1400 Independence parties may file suit in court. Under Avenue, SW.; Washington, DC 20250– § 1625 of the Act, a person subject to an 0251. Comments may also be sent by e- Order may file a petition with the DEPARTMENT OF AGRICULTURE mail to [email protected] or by Secretary stating that such Order, a fax to 202/720–1125. State that your provision of such Order or an obligation Agricultural Marketing Service comments refer to Docket No. LS–02– imposed in connection with such Order 15. Comments received may be is not in accordance with law; and 7 CFR Part 1230 inspected at this location between 8 requesting a modification of the Order a.m. and 4:30 p.m., Monday through or an exemption from the Order. Such [No. LS–02–15] Friday, except holidays, or on the person is afforded the opportunity for a Internet at www.ams.usda.gov/lsg/mpb/ hearing on the petition. After the Pork Promotion, Research, and rp-pork.htm. hearing, USDA would rule on the Consumer Information Program: Pursuant to the Paperwork Reduction petition. The Act provides that the Submission of Information Act of 1995 (44 U.S.C. chapter 35)(PRA), district court of the United States in the also send comments regarding the district in which the person resides or AGENCY: Agricultural Marketing Service, merits of the burden estimate, ways to does business has jurisdiction to review USDA. minimize the burden, including through USDA’s determination, if a complaint is ACTION: Proposed rule. the use of automated collection filed not later than 20 days after the date techniques or other forms of information such person receives notice of such SUMMARY: Pursuant to the Pork technology, or any other aspect of this determination. Promotion, Research, and Consumer collection of information to the above Pursuant to requirements set forth in Information Act of 1985 (Act) and the address. Comments concerning the the Regulatory Flexibility Act (RFA)(5 Pork Promotion, Research, and information collection requirements U.S.C. 601 et seq.), AMS has considered Consumer Information Order (Order) contained in this proposed rule should the economic effect of this proposed issued thereunder, this proposed rule also be sent to the Offices of Information action on small entities. The purpose of would add a section to the regulations and Regulatory Affairs, Office of RFA is to fit regulatory actions to the that implement the Order to require Management and Budget, New scale of businesses subject to such remitters of pork checkoff assessments, Executive Office Building, 725 17th actions in order that small businesses upon request by the Department of Street, NW., Room 725, Washington, DC will not be unduly burdened. The Agriculture (USDA), to submit to the 20503, Attention: Desk Officer for National Pork Board (Board), which Agricultural Marketing Service (AMS) Agriculture. receives the pork checkoff assessments, the names, addresses, and any other FOR FURTHER INFORMATION CONTACT: estimated that in calendar year 2001, information deemed necessary to Kenneth R. Payne, Chief, Marketing there were approximately 3,173 entities identify persons from whom Programs Branch on 202/720–1115, fax that remitted pork checkoff assessments. assessments were collected. This action 202/720–1125, or by e-mail at Many of these entities which include is necessary in order to obtain the [email protected]. packers, auction markets, county fairs, information necessary to conduct a SUPPLEMENTARY INFORMATION: and individual pork producers should survey of eligible producers and be classified as small entities under the importers no earlier than June 2003 to Executive Order 12866 and 12988 and criteria established by the Small determine if they favor a referendum on Regulatory Flexibility Act and the Business Administration (SBA)(13 CFR the Pork Checkoff Program. AMS agreed Paperwork Reduction Act 121.201). SBA defines small agricultural to conduct a survey as part of a The Office of Management and Budget producers as those having annual settlement of litigation against USDA has waived the review process required receipts of less than $750,000, small filed by the Michigan Pork Producers by Executive Order 12866 for this agricultural service firms as those whose Association (MPPA) and the National action. annual receipts are less than $5 million, Pork Producers Council. The This proposed rule has been reviewed and small meat packers as those that information that would be collected under Executive Order 12988, Civil have less than 500 employees. through this action would be used to Justice Reform. It is not intended to This proposed rule would require, establish the total number of pork have a retroactive effect. The Act states upon request by USDA, remitters of producers and importers that would be that the statute is intended to occupy pork checkoff assessments to submit to utilized in determining whether the 15 the field of promotion and consumer AMS the names, addresses, and any percent threshold requirement education involving pork and pork other information deemed necessary to contained in the Act for conducting a products and of obtaining funds thereof identify persons from whom referendum has been met. from pork producers and that the assessments were collected. This DATES: Written comments on this regulation of such activity (other than a information would be available from proposed rule must be received by May regulation or requirement relating to a existing records. The information 12, 2003. matter of public health or the provision collection requirements, as discussed

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below, would be minimal. It is review their paper records, compile the practical utility; (2) the accuracy of the anticipated that much of the required necessary information, and submit it to agency’s estimate of the burden of the information would be able to be AMS via facsimile or mail. AMS proposed collection of information submitted electronically and would not estimates the time required to complete including the validity of the be a significant burden. Accordingly, this task to be 4 hours per respondent methodology and assumptions used; (3) AMS has determined that this proposed at a cost of $20 per hour. AMS estimates ways to enhance the quality, utility, and rule will not have a significant the total cost in complying with this clarity of the information to be economic impact on a substantial request would be $241,320. collected; and (4) ways to minimize the number of small business entities. In this proposed rule, information burden of the collection of information collection requirements include the on those who are to respond, including Paperwork Reduction Act following: through the use of appropriate In accordance with the OMB (1) Electronic submission of automated, electronic, mechanical, or regulation (5 CFR part 1320) that information by entities that have other technological collection implements the PRA (44 U.S.C. chapter personnel on staff to operate and techniques or other forms of information 35), the information collection manage their computer system. technology. requirements are being submitted to Estimate of Burden: The public OMB is required to make a decision OMB for approval. reporting burden for this collection of concerning the collection of information Title: Pork Promotion, Research, and information is estimated to average 1 contained in this rule between 30 days Consumer Information Program: hour per response. and 60 days after publication. Therefore, Submission of Information. Respondents: Packers, auction a comment to OMB is best assured of OMB Number: 0581-new collection. markets, county fairs, and individual being considered if OMB receives it Expiration Date of Approval: 3 years producer entities. within 30 days after publication. from date of approval. Estimated Number of Respondents: Background Type of Request: Approval of new 271. information collection. Estimated Number of Responses per The Act (7 U.S.C. 4801–4819) Abstract: The purpose of this Respondent: 1. approved December 23, 1985, proposed rule is to add a section to the Estimated Total Annual Burden on authorized the establishment of a regulations that implement the Order Respondents: 271 hours. national pork promotion, research, and that would require remitters of pork Total Cost: $5,420. consumer information program. The checkoff assessments, upon request by (2) Electronic submission of final Order establishing a pork USDA, to submit to AMS the names, information by entities that rely on an promotion, research, and consumer addresses, and any other information outside contractor to manage their information program was published in deemed necessary to identify persons computer system. the September 5, 1986, issue of the from whom assessments were collected. Estimate of Burden: The public Federal Register (51 FR 31898; as There is no form to fill out. The reporting burden for this collection of corrected, at 51 FR 36383 and amended necessary information to be submitted information is estimated to average 2 at 53 FR 1909, 53 FR 30243, 56 FR 4, either electronically, e-mail, facsimile, hours per response. 56 FR 51635, 60 FR 29963, 61 FR 29002, or by mail may done so in any format Respondents: Packers, auction 62 FR 26205, 63 FR 45936, 64 FR 44643, or style. markets, county fairs, and individual 66 FR 67071, 67 FR 47474, and 67 FR Based on estimates provided by the producer entities. 58320) and assessments began on Board, there are approximately 3,173 Estimated Number of Respondents: November 1, 1986. The program was entities that remitted pork checkoff 187. funded by an initial assessment rate of assessments in calendar year 2001. Estimated Number of Responses per 0.25 percent of the market value of all It is anticipated that many of these Respondent: 1. porcine animals marketed in the United entities maintain their records Estimated Total Annual Burden on States and on imported porcine animals electronically and have a person on staff Respondents: 374 hours. with an equivalent assessment on pork to operate and manage their computer Total Cost: $18,700. and pork products. However, that rate system. The only costs that would be (3) Submission of information by was increased to 0.35 percent effective incurred by these entities in complying those entities that do not maintain their December 1, 1991 (56 FR 51635), to 0.45 with this request would be the labor records electronically. percent effective September 3, 1995 (60 hours required to retrieve the pertinent Estimate of Burden: The public FR 29963), and was decreased to 0.40 information from the computer system reporting burden for this collection of percent effective September 30, 2002 (67 and transmit it electronically to AMS. information is estimated to average 4 FR 58320). AMS estimates the time required to hours per response. Section 1230.80 of the Order requires complete this task to be 1 hour per Respondents: Packers, auction each person that is responsible for respondent at a cost of $20 per hour. markets, county fairs, and individual collecting or remitting any assessment For those entities that rely on an producer entities. under § 1230.71(b) to report the quantity outside contractor to manage their Estimated Number of Respondents: and market value of the animal subject computer system, there may be a one- 2,715. to assessment, the amount of assessment time fee incurred for having the Estimated Number of Responses per collected, the month the assessment was contractor retrieve the necessary Respondent: 1. collected, the State where the animal information from the system and Estimated Total Annual Burden on was produced, and ‘‘Such other transmit it electronically to AMS. AMS Respondents: 10,860 hours. information as may be required by estimates the time required to complete Total Cost: $217,200. regulations * * *’’ Accordingly, to this task to be 2 hours per respondent Comments are invited on: (1) Whether assist AMS in its administration and at a cost of $50 per hour. the proposed collection of information oversight of the Pork Checkoff Program, For those entities that do not maintain is necessary for the proper performance particularly in conducting activities their records electronically, it is of the functions of the agency, including such as surveys and referendums, a new anticipated that such entities would whether the information would have section would be added to the

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regulations that would require remitters DEPARTMENT OF AGRICULTURE information, including the names of of pork checkoff assessments, upon organizations and individuals who have request by USDA, to submit to AMS the Animal and Plant Health Inspection commented on APHIS dockets, are names, addresses, and any other Service available on the Internet at http:// information deemed necessary to www.aphis.usda.gov/ppd/rad/ identify persons from whom 9 CFR Part 94 webrepor.html. assessments were collected. [Docket No. 00–080–2] FOR FURTHER INFORMATION CONTACT: Dr. As part of a settlement between USDA Charisse Cleare, Senior Staff Availability of Evaluation Related to and MPPA, et al., USDA agreed to Veterinarian, National Center for Import Hog Cholera (Classical Swine Fever) and Export, VS, APHIS, 4700 River conduct a survey of eligible producers Status of East Anglia and importers (no earlier than June Road Unit 38, Riverdale, MD 20737– 2003) to determine whether 15 percent AGENCY: Animal and Plant Health 1231; (301) 734–4928. of eligible producers and importers Inspection Service, USDA. SUPPLEMENTARY INFORMATION: favor a referendum on the Pork Checkoff ACTION: Notice of availability and Background Program. The information that would be request for comments. The regulations in 9 CFR part 94 collected through this action may be SUMMARY: We are advising the public (referred to below as the regulations) used to establish the total number of that an evaluation has been prepared by govern the importation of certain pork producers that would be utilized in the Animal and Plant Health Inspection animals and animal products into the determining whether the 15 percent Service concerning the hog cholera United States in order to prevent the threshold requirement contained in the (classical swine fever) status of East introduction of various animal diseases, Act for conducting a referendum has Anglia, a region of England that including rinderpest, foot-and-mouth been met. Further, the information includes the counties of Essex, Norfolk, disease, African swine fever, hog could be used in subsequent referenda and Suffolk, and the related disease cholera (classical swine fever), and to determine the number of eligible risks associated with importing animals swine vesicular disease. These are producers. and animal products into the United dangerous and destructive States from East Anglia. This evaluation communicable diseases of ruminants List of Subjects in 7 CFR Part 1230 will be used as a basis for determining and swine. Section 94.9 of the Administrative practice and whether to relieve certain prohibitions regulations restricts the importation into procedure, Advertising, Agricultural and restrictions on the importation of the United States of pork and pork pork and pork products and swine into research, Marketing agreement, Meat products from regions where hog the United States from East Anglia. We and meat products, Pork and pork cholera is known to exist. Section 94.10 are making this evaluation available to products. of the regulations, with certain the public for review and comment. exceptions, prohibits the importation of For the reasons set forth in the DATES: We will consider all comments swine that originate in or are shipped preamble, it is proposed that 7 CFR part that we receive on or before May 12, from or transit any region in which hog 1230 be amended as follows: 2003. cholera is known to exist. The ADDRESSES: You may submit comments regulations in §§ 94.9(a) and 94.10(a) PART 1230—PORK PROMOTION, by postal mail/commercial delivery or provide that hog cholera exists in all RESEARCH, AND CONSUMER by e-mail. If you use postal mail/ regions of the world except for certain INFORMATION commercial delivery, please send four regions listed in those sections. copies of your comment (an original and In an interim rule effective August 4, 1. The authority citation for 7 CFR three copies) to: Docket No. 00–080–2, 2000, and published in the Federal part 1230 continues to read as follows: Regulatory Analysis and Development, Register on September 20, 2000 (65 FR Authority: 7 U.S.C. 4801–4819. PPD, APHIS, Station 3C71, 4700 River 56774–56775, Docket No. 00–080–1), we Road Unit 118, Riverdale, MD 20737– amended the regulations by removing 2. Section 1230.121 would be added 1238. Please state that your comment East Anglia (a region of England that to read as follows: refers to Docket No. 00–080–2. If you includes Essex, Norfolk, and Suffolk use e-mail, address your comment to counties) from the lists of regions § 1230.121 Submission of Information. [email protected]. Your considered to be free of hog cholera. Pursuant to the provisions of comment must be contained in the body That action was necessary because hog § 1230.80, at the request of the of your message; do not send attached cholera had been confirmed in this Secretary, each person responsible for files. Please include your name and region. The effect of the interim rule collecting and remitting assessments to address in your message and ‘‘Docket was to restrict the importation of pork and pork products and to prohibit the the Board, shall submit the names, No. 00–080–2’’ on the subject line. You may read any comments that we importation of swine into the United addresses, and any other information receive on the evaluation in our reading States from East Anglia. deemed necessary to identify persons room. The reading room is located in Although we removed East Anglia from whom assessments were collected room 1141 of the USDA South Building, from the list of regions considered to be to the Department. 14th Street and Independence Avenue free of hog cholera, we recognized that Dated: March 11, 2003. SW., Washington, DC. Normal reading Great Britain’s Ministry of Agriculture, A.J. Yates, room hours are 8 a.m. to 4:30 p.m., Fisheries and Food, now part of the Administrator, Agricultural Marketing Monday through Friday, except Department for Environment, Food, and Service. holidays. To be sure someone is there to Rural Affairs, immediately responded to the detection of hog cholera by initiating [FR Doc. 03–6163 Filed 3–11–03; 12:59 pm] help you, please call (202) 690–2817 before coming. measures to eradicate the disease. We BILLING CODE 3410–02–P APHIS documents published in the stated that we intended to reassess the Federal Register, and related situation in the region at a future date

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in accordance with Office International Done in Washington, DC, this 7th day of Boeing Commercial Airplane Group, des Epizooties standards, and that as March, 2003. P.O. Box 3703, Seattle, Washington part of that reassessment process, we Kevin Shea, 98124–2207. This information may be would consider all comments received Acting Administrator, Animal and Plant examined, by appointment, at the FAA, regarding the interim rule. Health Inspection Service. New England Region, Office of the Regional Counsel, 12 New England Additionally, we stated that the future [FR Doc. 03–6059 Filed 3–12–03; 8:45 am] Executive Park, Burlington, MA. assessment would enable us to BILLING CODE 3410–34–P FOR FURTHER INFORMATION CONTACT: determine whether it was necessary to Terry Fahr, Aerospace Engineer, Boston continue to prohibit the importation of Aircraft Certification Office, FAA, swine and to restrict the importation of DEPARTMENT OF TRANSPORTATION Engine and Propeller Directorate, 12 pork and pork products from East Federal Aviation Administration New England Executive Park, Anglia, or whether we could restore East Burlington, MA 01803–5299; telephone Anglia to the list of regions in which 14 CFR Part 39 (781) 238–7155; fax (781) 238–7199. hog cholera is not known to exist. [Docket No. 2002–NE–22–AD] SUPPLEMENTARY INFORMATION: In this notice, we are announcing the availability for review and comment of RIN 2120–AA64 Comments Invited a document entitled ‘‘APHIS Evaluation Interested persons are invited to Airworthiness Directives; Titeflex of the Classical Swine Fever Status of participate in the making of the Corporation East Anglia (counties of Norfolk, proposed rule by submitting such Suffolk, and Essex) November 2002.’’ AGENCY: Federal Aviation written data, views, or arguments as This evaluation assesses the hog cholera Administration, DOT. they may desire. Communications should identify the Rules Docket (classical swine fever) status of East ACTION: Notice of proposed rulemaking number and be submitted in triplicate to Anglia and the related disease risks (NPRM). associated with importing animals and the address specified above. All communications received on or before animal products into the United States SUMMARY: The Federal Aviation the closing date for comments, specified from East Anglia. This evaluation will Administration (FAA) proposes to adopt above, will be considered before taking serve as a basis for our determination a new airworthiness directive (AD) that is applicable to certain Titeflex action on the proposed rule. The whether to relieve certain prohibitions proposals contained in this action may and restrictions on the importation of Corporation hoses installed on Boeing 737–300, –400, –500, –600, –700, be changed in light of the comments swine and pork and pork products into –700C, –800, –900, 747–400, 757–200, received. the United States from East Anglia. We –300, 767–200, –300, and –300F Comments are specifically invited on are making the evaluation available for airplanes. This proposal would require the overall regulatory, economic, public comment for 60 days. within 24 months after the effective date environmental, and energy aspects of You may view the evaluation in our of the AD, inspection of certain Titeflex the proposed rule. All comments reading room (information on the Corporation hoses for proper date and submitted will be available, both before location and hours of the reading room paint code, replacement if necessary, and after the closing date for comments, is provided under the heading and if necessary, inspection for proper in the Rules Docket for examination by ADDRESSES at the beginning of this heat treatment of aluminum B-nuts. interested persons. A report notice). You may also request a copy by This proposal is prompted by certain summarizing each FAA-public contact calling or writing to the person listed Titeflex Corporation hoses discovered concerned with the substance of this under FOR FURTHER INFORMATION with incorrect heat treatment of B-nuts. proposal will be filed in the Rules Docket. CONTACT. Please refer to the title of the The actions specified by the proposed Commenters wishing the FAA to evaluation when requesting copies. AD are intended to prevent fire extinguishing system and fuel system acknowledge receipt of their comments You may also view the evaluation on hose failure due to improperly heat submitted in response to this action the Internet at http:// treated aluminum B-nuts. must submit a self-addressed, stamped www.aphis.usda.gov/vs/ncie/reg- postcard on which the following DATES: Comments must be received by request.html. At the bottom of the statement is made: ‘‘Comments to May 12, 2003. website page, click on ‘‘Information Docket Number 2002–NE–22–AD.’’ The previously submitted by Regions ADDRESSES: Submit comments in postcard will be date stamped and requesting export approval and their triplicate to the Federal Aviation returned to the commenter. Administration (FAA), New England supporting documentation.’’ At the next Availability of NPRMs screen, click on the triangle beside Region, Office of the Regional Counsel, Attention: Rules Docket No. 2002–NE– ‘‘European Union/Not Specified/ Any person may obtain a copy of this 22–AD, 12 New England Executive Park, Classical Swine Fever,’’ then on the NPRM by submitting a request to the Burlington, MA 01803–5299. Comments triangle beside ‘‘Response by APHIS.’’ A FAA, New England Region, Office of the may be inspected at this location, by link will then appear for ‘‘APHIS Regional Counsel, Attention: Rules appointment, between 8 a.m. and 4:30 Evaluation of Classical Swine Fever Docket No. 2002–NE–22–AD, 12 New p.m., Monday through Friday, except Status of East Anglia (counties of England Executive Park, Burlington, MA Federal holidays. Comments may also 01803–5299. Norfolk, Suffolk, and Essex) November be sent via the Internet using the 2002.’’ Following that link will allow following address: ‘‘9-ane- Discussion you to view the evaluation. [email protected]’’. Comments sent In March of 2001, the FAA became Authority: 7 U.S.C. 450, 7701–7772, and via the Internet must contain the docket aware that some of the B-nuts on certain 8301–8317; 21 U.S.C. 136 and 136a; 31 number in the subject line. engine and cargo compartment fire U.S.C. 9701; 42 U.S.C. 4331 and 4332; 7 CFR The service information referenced in extinguishing system hoses, and on 2.22, 2.80, and 371.4. the proposed rule may be obtained from certain fuel hoses, all manufactured by

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Titeflex Corporation, delivered to ASB 767–26A0121, and ASB 747– promulgated, will not have a significant Boeing from November 1999 through 26A2269, and within 18 months after economic impact, positive or negative, January 2001, are suspect for improper the initial release dates of ASB 757– on a substantial number of small entities heat treatment. Improperly heat treated 26A0043 and ASB 757–26A0044, this under the criteria of the Regulatory B-nuts can lead to stress corrosion B-nut proposal would require inspections and Flexibility Act. A copy of the draft failure, and inadequate fire protection replacing unserviceable hoses to be regulatory evaluation prepared for this and fuel leakage. This condition, if not done within 24 months after the action is contained in the Rules Docket. corrected, could result in fire effective date of the AD. This A copy of it may be obtained by extinguishing system and fuel system compliance time was substantiated by contacting the Rules Docket at the hose failure due to improperly heat analysis by Boeing and coordinated location provided under the caption treated aluminum B-nuts. between the FAA and Boeing to help ADDRESSES. coincide with parts availability. Manufacturer’s Service Information List of Subjects in 14 CFR Part 39 FAA’s Determination of an Unsafe The FAA has reviewed and approved Air transportation, Aircraft, Aviation Condition and Proposed Actions the technical contents of the following safety, Safety. Boeing alert service bulletins (ASBs): Since an unsafe condition has been • ASB 737–26A1108, Revision 1, identified that is likely to exist or The Proposed Amendment dated June 27, 2002, applicable to 737– develop on other Titeflex Corporation Accordingly, pursuant to the 300, –400, and –500 airplanes, that hoses of the same type design, installed authority delegated to me by the describes procedures for inspecting and on Boeing 737–300, –400, –500, –600, Administrator, the Federal Aviation replacing if necessary, Titeflex –700, –700C, –800, –900, 747–400, 757– Administration proposes to amend part Corporation hoses connected to engine 200, –300, 767–200, –300, and –300F 39 of the Federal Aviation Regulations and cargo compartment fire airplanes, the proposed AD would (14 CFR part 39) as follows: extinguishing bottles. require within 24 months after the • ASB 737–26A1109, Revision 1, effective date of the AD, inspection of PART 39—AIRWORTHINESS dated November 7, 2002, applicable to hoses for proper date and paint code, DIRECTIVES 737–600, –700, –700C, –800, and –900 replacement if necessary, and if 1. The authority citation for part 39 airplanes, that describes procedures for necessary, inspection for proper heat continues to read as follows: inspecting and replacing if necessary, treatment of aluminum B–nuts. The Titeflex Corporation hoses connected to actions would be required to be done in Authority: 49 U.S.C. 106(g), 40113, 44701. engine, auxiliary power unit (APU), and accordance with the alert service § 39.13 [Amended] cargo compartment fire extinguishing bulletins described previously. This 2. Section 39.13 is amended by bottles, and wing-to-strut fuel hoses. proposal has been coordinated with the • adding the following new airworthiness ASB 747–26A2269, Revision 1, FAA Transport Airplane Directorate. directive: dated June 6, 2002, applicable to 747– 400, that describes procedures for Economic Analysis Titeflex Corporation: Docket No. 2002–NE– inspecting and replacing if necessary, The FAA estimates that 1,139 22–AD. Titeflex Corporation hoses connected to airplanes of U.S. registry would be Applicability: This airworthiness directive forward cargo and main deck cargo affected by this proposed AD. The FAA (AD) is applicable to certain Titeflex Corporation hoses that are identified by compartment fire extinguishing bottles. also estimates that it would take • Boeing part number (P/N), or for certain ASB 757–26A0043, Revision 1, approximately 35 work hours per hoses, by Titeflex parts manufacturer dated November 14, 2002, applicable to airplane to perform the proposed approval (PMA) P/N in this AD. These hoses 757–200 airplanes, that describes actions, and that the average labor rate are used on, but not limited to Boeing 737– procedures for inspecting and replacing is $60 per work hour. Required parts 300, –400, –500, –600, –700, –700C, –800, if necessary, Titeflex Corporation hoses would cost approximately $4,305 per and –900; 757–200 and –300; 767–200, –300, connected to engine, APU, and cargo engine. Based on these figures, the total and –300F; and 747–400 airplanes. compartment fire extinguishing bottles. cost of the proposed AD to U.S. Note 1: This AD applies to each hose • ASB 757–26A0044, Revision 1, operators is estimated to be $7,295,295. identified in the preceding applicability dated November 14, 2002, applicable to provision, regardless of whether it has been Regulatory Analysis 757–300 airplanes, that describes modified, altered, or repaired in the area procedures for inspecting and replacing This proposed rule does not have subject to the requirements of this AD. For if necessary, Titeflex Corporation hoses federalism implications, as defined in hoses that have been modified, altered, or Executive Order 13132, because it repaired so that the performance of the connected to engine and cargo requirements of this AD is affected, the compartment fire extinguishing bottles. would not have a substantial direct • owner/operator must request approval for an ASB 767–26A0121, dated December effect on the States, on the relationship alternative method of compliance in 19, 2001, applicable to 767–200, –300, between the national government and accordance with paragraph (f) of this AD. The and –300F airplanes, that describes the States, or on the distribution of request should include an assessment of the procedures for inspecting and replacing power and responsibilities among the effect of the modification, alteration, or repair if necessary, Titeflex Corporation hoses various levels of government. on the unsafe condition addressed by this connected to cargo compartment fire Accordingly, the FAA has not consulted AD; and, if the unsafe condition has not been extinguishing bottles. with state authorities prior to eliminated, the request should include publication of this proposed rule. specific proposed actions to address it. Differences Between This AD and the For the reasons discussed above, I Compliance Manufacturer’s Service Information certify that this proposed regulation (1) Compliance with this AD is required as Although the ASBs recommend is not a ‘‘significant regulatory action’’ indicated, unless already done. performing the inspections and under Executive Order 12866; (2) is not To prevent fire extinguishing system and replacing unserviceable hoses within 12 a ‘‘significant rule’’ under the DOT fuel system hose failure due to improperly months after the initial release dates of Regulatory Policies and Procedures (44 heat treated aluminum B–nuts, do the ASB 737–26A1108, ASB 737–26A1109, FR 11034, February 26, 1979); and (3) if following:

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(a) Within 24 months after the effective in accordance with the Accomplishment service bulletins (ASB) contained in Table 1 date of this AD, inspect the manufacture date Instructions of the applicable Boeing alert of this AD. Table 1 follows: code on all hoses listed in Table 1 of this AD,

TABLE 1.—APPLICABLE HOSE P/NS

Titeflex PMA Applicable alert service Airplane model Boeing hose p/n p/n Used for— bulletin—

(1) 737–300, –400, and S312N512–5, S312N512–6, 113701–5, 113701–6 .... Engine and cargo com- 737–26A1108, Revision –500 airplanes. BACH5R0110YP, partment fire extin- 1, dated June 27, BACH5S0110XN. guishing bottles. 2002. (2) 737–600, –700, S316A001–1, S316A001–2, 115398–1, 115398–2, Engine, auxiliary power 737–26A1109, Revision –700C, –800, and S312N512–15, S312N512–17, 113701–15, 113701– unit (APU), and cargo 1, dated November 7, –900 airplanes. S312N512–18, BACH5R0110YP, 17, 113701–18. compartment fire ex- 2002. BACH5S0110XN. tinguishing bottles, and wing-to-strut fuel hoses. (3) 747–400 airplanes .... BACH5R0080YY, BACH5R0140YU, ...... Forward cargo and main 747–26A2269, Revision BACH5S0140XT, deck cargo compart- 1, dated June 6, BACH5R0186YY, ment fire extin- 2002. BACH5R0186XX, guishing bottles. BACH5S0080XX, BACH5S0080YY, BACH5S0110XN. (4) 757–200 airplanes .... S312N512–1, S312N512–2, 113701–1, 113701–2, Engine, APU, and cargo 757–26A0043, Revision S312N512–3, S312N512–4, 113701–3, 113701–4. compartment fire ex- 1, dated November BACH5R0110YP, tinguishing bottles. 14, 2002. BACH5S0110XN. (5) 757–300 airplanes .... S312N512–1, S312N512–2, 113701–1, 113701–2, Engine and cargo com- 757–26A0044, Revision S312N512–3, S312N512–4, 113701–3, 113701–4. partment fire extin- 1, dated November BACH5R0110YP, guishing bottles. 14, 2002. BACH5S0074XN. (6) 767–200, –300, and BACH5R0085YU, BACH5R0140YU, ...... Cargo compartment fire 767–26A0121, dated –300F airplanes. BACH5S0077XT, extinguishing bottles. December 19, 2001. BACH5S0140XT, BACH5S0184XX, BACH5R0127YY.

(b) If the hose manufacture date code is Inspector, who may add comments and then COMMODITY FUTURES TRADING before 11/99 or after 1/01, or if the send it to the Manager, Boston ACO. COMMISSION manufacture date is 11/99 through 1/01 and Note 2: Information concerning the there is a permanent white dot on the ID existence of approved alternative methods of 17 CFR Part 4 band, no further action is required for that compliance with this airworthiness directive, hose. if any, may be obtained from the Boston Performance Data and Disclosure for (c) If the hose manufacture date code is 11/ Commodity Trading Advisors 99 through 1/01 inclusive and there is no ACO. permanent white dot on the ID band, replace Special Flight Permits AGENCY: Commodity Futures Trading the hose with a serviceable hose or perform Commission. an indirect conductive inspection/test for (g) Special flight permits may be issued in ACTION: Proposed rules. proper heat treat, in accordance with the accordance with §§ 21.197 and 21.199 of the accomplishment instructions of the Federal Aviation Regulations (14 CFR 21.197 SUMMARY: The Commodity Futures applicable ASB listed in Table 1 of this AD. and 21.199) to operate the airplane to a Trading Commission (‘‘CFTC’’ or (d) Replace the hose with a serviceable location where the requirements of this AD ‘‘Commission’’) is proposing to amend hose if any B-nut is improperly heat treated. can be done. its rules relating to the computation and Credit for Previous Inspections Issued in Burlington, Massachusetts, on presentation of rate of return (e) Previous inspections performed using March 6, 2003. information and other disclosures ASB 737–26A1108, dated November 15, Jay J. Pardee, concerning partially-funded accounts 2001, ASB 737–26A1109, dated November Manager, Engine and Propeller Directorate, managed by commodity trading advisors 15, 2001, ASB 747–26A2269, dated Aircraft Certification Service. (‘‘CTAs’’). November 1, 2001, ASB 757–26A0043, dated November 15, 2001, and ASB 757–26A0044, [FR Doc. 03–6043 Filed 3–12–03; 8:45 am] DATES: Comments must be received by dated November 15, 2001, comply with the BILLING CODE 4910–13–P April 14, 2003. inspection requirements of this AD. ADDRESSES: Interested persons should Alternative Methods of Compliance submit their views and comments to Jean A. Webb, Secretary of the (f) An alternative method of compliance or Commission, Commodity Futures adjustment of the compliance time that provides an acceptable level of safety may be Trading Commission, Three Lafayette used if approved by the Manager, Boston Centre, 1155 21st Street, NW., Aircraft Certification Office (ACO). Operators Washington, DC 20581. In addition, must submit their request through an comments may be sent by facsimile appropriate FAA Principal Maintenance transmission to (202) 418–5543, or by

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electronic mail to [email protected]. reevaluation of certain of the issues was defined as the net performance 6 for Reference should be made to involved, the Commission is that period divided by the net asset ‘‘Performance Data and Disclosure for reproposing these amendments. value at the beginning of the period.7 At Commodity Trading Advisors.’’ that time, the practice of partial funding II. Proposed Amendments to was not common; clients generally FOR FURTHER INFORMATION CONTACT: Commission Regulations 4.25, 4.33, deposited in their accounts with FCMs Robert B. Wasserman, Associate 4.34 and 4.35 Director, (202) 418–5092, electronic an amount equal to the amount that the mail: [email protected], or Eileen R. A. Rate of Return Computation CTA and its customer had agreed would Chotiner, Futures Trading Specialist, determine the level of trading, which This proposal addresses how to (202) 418–5467, electronic mail: subsequently became known as the measure advisors’ rates of return in a [email protected], Division of Clearing ‘‘Nominal Account Size.’’ margin- and leverage-based industry. and Intermediary Oversight, Commodity In later years, Commission staff From the CTA’s perspective, trading is Futures Trading Commission, 1155 21st became aware that some CTA clients the same for all accounts in a program, Street, NW., Washington, DC 20581. were not depositing the full nominal regardless of the amount of actual funds. SUPPLEMENTARY INFORMATION: account size in their FCM accounts. The use of margin, however, allows This led the Division of Trading and I. Background clients to fund accounts with much less Markets 8 to issue Advisory 87–2, which in actual funds than the account size The Commission is proposing to stated that only funds under the control that they have agreed to have the CTA amend several of its rules 1 affecting the of the CTA (‘‘Actual Funds’’) could be trade. Determination of the amount a computation and presentation of rate of included in beginning net asset value client deposits with an FCM is between return information and other disclosures (‘‘BNAV’’).9 Advisory 87–2 stated that the FCM and the client—the CTA is not by CTAs to prospective clients. The ‘‘funds which the client has promised part of this decision, nor does it affect proposed amendments will enable CTAs orally to provide upon request’’ (there the CTA’s level of trading for the client’s to disclose past performance as described as ‘‘notional’’ funds) could account. Each existing CTA client will computed on the basis of the client’s not be included in BNAV. receive from its FCM reports of the nominal account size (the amount upon After Advisory 87–2 was issued, amount of actual funds in the account, which the CTA bases its trading Commission staff were frequently the profits or losses that occur, fees decisions) rather than on the basis of the apprised by industry participants of charged, and notice of any margin calls actual funds the client has placed in an their concerns regarding the possible that may be necessary. account subject to the CTA’s control. distortions to rates of return calculated The amendments will affect past The rules that the Commission is based on actual funds rather than the performance disclosure made by CTAs proposing to revise apply to the account size, designated by the client, to prospective clients, and will not disclosure of the CTA’s past upon which the CTA made its trading affect the manner in which information performance to prospective clients. The decisions.10 In 1993, the Commission is provided to existing clients. Existing difficulty in basing such performance on issued Advisory 93–13, in an effort to clients will continue to receive actual funding levels arises primarily alleviate these concerns and to reach a information on the status of their own from the use of margin, which permits compromise between the actual funds accounts on an actual cash basis.2 actual funding levels that may be so and the ‘‘notional’’ funds methods of On August 2, 1999, the Commission minimal as to make a return calculated computing performance.11 published in the Federal Register 3 on that basis greatly distorted. In Advisory 93–13 permitted CTAs to proposed rules regarding the addition, clients generally may open disclose, as their past performance, the computation and presentation of rate of accounts with an FCM of their own return information and other disclosures choosing and clients in the same trading 6 Commission Rule 4.35(a)(6)(i)(D) currently program may, in fact, have widely specifies that net performance represents the concerning past performance of change in the net asset value net of additions, accounts over which the CTA has had divergent amounts of actual funds withdrawals, redemptions, fees and expenses. trading authority.4 No final action was supporting the same level of trading. In Commission Rule 4.10(b) currently defines ‘‘net taken at that time. Now, due to the order to allow CTAs to present to asset value’’ as ‘‘total assets minus total liabilities, prospective clients composite determined in accord with generally accepted passage of time, intervening legislative accounting principles, with each position in a and other developments, including performance results that will be commodity interest accounted for at fair market consistent for the accounts within the value.’’ 1 Commission rules cited herein are found at 17 program, the Commission is proposing 7 Commission Rule 4.35(a)(6)(i)(A). CFR Ch. I (2002). that the basis for the rate of return 8 Following the Commission’s reorganization in 2 Commission Rule 1.33 sets forth the calculation be the amount on which the July 2001, the Division of Trading and Markets’ role requirements applicable to futures commission CTA is making its trading decisions— with respect to CPOs and CTAs is now carried out merchants (‘‘FCMs’’) with respect to reporting to by the Division of Clearing and Intermediary their customers. Commission rules cited herein are the nominal account size. Oversight. 9 found at 17 CFR Ch. I (2002). 1. Brief History of Methods Used To CFTC Advisory 87–2 [1986–87 Transfer Binder] 3 See 64 FR 41843 (August 2, 1999). Comm. Fut. L. Rep. (CCH) ¶ 23,624 (June 2, 1987). 4 Those proposed amendments developed out of Compute Rates of Return Advisory 87–2 specified that funds contained in a rules proposed by National Futures Association commodity trading account over which the CTA (‘‘NFA’’) to permit CTAs to disclose past The Commission first required has been given trading authority must be included performance as computed on the basis of the disclosure of the past performance of in BNAV, and set forth the conditions under which client’s nominal account size (the amount upon CTAs in 1981.5 The rate of return for a funds contained in any other type of account carried with the FCM could be included in BNAV. which the CTA bases its trading), rather than on the period for a particular trading program basis of the actual funds the client has placed in 10 These concerns were among the issues accounts subject to the CTA’s control. The NFA addressed by the Managed Futures Subcommittee of proposal was also the subject of a concept release 5 See 46 FR 26005, 26009 (May 8, 1981). Pursuant the Commission’s Regulatory Coordination published by the Commission in June 1998 that to the original Part 4 disclosure rules adopted in Advisory Committee, which existed from 1990 to discussed a number of possible enhancements and 1979, CTAs were permitted, but not required, to 1995. alternatives to the NFA proposal and sought public disclose their past performance in accordance with 11 CFTC Advisory 93–13, 58 FR 8226 (February comment on those issues. See 63 FR 33297 (June the format specified for commodity pool 12, 1993). The term ‘‘nominal account size’’ was 18, 1998). performance. 44 FR 1918, 1923 (January 8, 1979). introduced in Advisory 93–13.

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rate of return of a ‘‘fully-funded subset’’ 2. Proposed Changes to Commission these accounts into a rate of return that of their accounts, provided that two Regulation 4.35(a)(6)(i) To Adopt would not be representative of any standards were met.12 The first standard Nominal Account Size as the client’s actual results. Some might argue required that the aggregate of the actual Denominator in the Rate of Return that if the actual funds-based returns of funds for the fully-funded accounts be Calculation these varyingly funded accounts at least ten percent of the aggregate of Existing Commission Regulation differed materially from each other, the nominal account sizes of the 4.35(a)(6)(i) requires that, in presenting their performance should be presented 17 accounts included in the program. The past performance to prospective in separate tables. This could result in second standard required that the gross participants, the rate of return for a numerous performance tables for each of the CTA’s programs, overwhelming trading profit ratio for the subset be period be calculated by dividing net clients with excessive amounts of data ‘‘materially the same’’ as the gross performance by the beginning net asset and severely impeding the usefulness of trading profit ratio for the aggregate.13 In value. The proposed amendment to Regulation 4.35(a)(6)(i) would require the performance disclosure. other words, the performance of the The fully-funded subset method has subset had to be, in fact, representative that the rate of return be computed by dividing net performance by the turned out to be unworkable for a of the performance of the aggregate, number of reasons. The primary reason considered on the basis of the nominal nominal account size at the beginning of the period.14 It is the proposed change is that many CTAs lack fully-funded account sizes. in the denominator of the rate of return accounts. Although Advisory 93–13 For example, if the CTA had 15 computation—from net asset value to allows for limited periods during which accounts, three of which were fully nominal account size—that underlies the fully-funded subset requirement is funded, the CTA could treat the rate of the framework for performance not met, this allowance is predicated on return of the three fully-funded presentation set forth in the rule the anticipated resumption of the fully- accounts as representative of all 15 proposal. funded subset in the near future. The Division has received numerous accounts as long as the two tests were The Commission recognizes that each questions over the years from CTAs who met. Thus, if all 15 accounts had of the methods that has been used or have qualified for the fully-funded nominal account sizes of $100,000, the proposed–the actual funds method, the fully-funded subset method, and the subset method for a period of time, but first standard would be met by the three due to the closing of fully-funded fully-funded accounts—i.e., $300,000/ nominal account size method—has flaws. For example, under the actual accounts and inability to obtain new $1,500,000 is twenty percent, which fully-funded accounts, cannot continue exceeds the ten percent minimum. This funds method, two accounts with the same nominal account size, which hold to use the fully-funded subset method. test could also be met by one the same market positions and number Further, in recent years, the use of sufficiently large fully-funded account. of contracts, and which experience the ‘‘master accounts’’ by commodity pools If each of the 15 accounts experienced same gains or losses, would show and clients who allocate to multiple gross profits of $10,000, the gross different performance if the clients CTAs has greatly increased. A master trading profits ratio of the subset would choose to fund their accounts account is a central account in which a be the same as the gross trading profits differently.15 Further, the CTA’s client deposits funds with the FCM to ratio of the aggregate, meeting the presentation of its past performance for support trading done by several CTAs. second test. Advisory 93–13 explicitly accounts in the same trading program Each of the CTAs is given trading permitted a number of adjustments and could combine, in the same actual authority for a sub-account, which will exceptions to these two standards. For funds-based performance table, reflect the positions implemented by example, an account could use the fully- accounts with vastly different amounts that CTA, and profits and losses on funded subset method despite failures of actual funds in relation to their these positions, but to which no funds to meet the ten percent test ‘‘for a nominal size.16 The resulting composite will be deposited. The margin limited number of periods.’’ presentation would blend the results of requirements for these positions will be met by funds maintained in the master Advisory 93–13 ameliorated 14 Additional changes to Rule 4.35(a)(6)(i)(A)–(F) account. Although the CTA will know disclosure problems for those CTAs that have been proposed to accommodate the use of the nominal account size, the actual had sufficiently fully-funded accounts nominal account size. These changes will be funds reported to the CTA will include to meet the ten percent test. discussed further below. only the value of the positions held in 15 For example, Client A and Client B each have Commission staff nonetheless have a nominal account size of $100,000. The CTA treats the sub-account (which could, in fact, increasingly encountered circumstances the two accounts identically, trading two S&P 500 be a negative amount due to unrealized where CTAs have lacked (or lost) futures contracts for each account. Each account losses). While in the past staff have experiences a $10,000 profit. Client A deposits sufficient fully-funded accounts, but $25,000 in actual funds, while Client B fully funds permitted the allocation of funds in a where disclosure based on actual funds the account with $100,000. Using the actual funds master account to various CTAs to be levels would be misleading or method, Client A’s rate of return would be 40%, computed and reported pursuant to a confusing. and Client B’s rate of return would be 10%, even Liquid Asset Allocation (‘‘LAA’’) though each client has the same nominal account 18 size, has been traded identically, and has received method, LAA methods have not the same dollar amount in profits. proven to be workable for the majority 16 In practice, prior to the issuance of Advisory of CPOs and other clients with master 12 ‘‘Fully-funded’’ refers to an account where the 93–13, Division of Trading and Markets staff accounts. Further, it is unclear that such amount of Actual Funds equals the nominal interpreted the actual funds method to require one account size. composite table that was based solely on actual 17 Rule 4.35(a)(3)(ii) specifies that accounts whose 13 Advisory 93–13 included a specific definition funds, and to permit a supplemental table including rates of return differ materially from each other may of ‘‘materially the same’’ in the context of ‘‘notional funds’’ (57 FR 53457, 53459 (November 10, 1992). This interpretation appears to have been not be presented in the same composite. comparing two percentages, depending on the based on provisions regarding retroactive 18 See CFTC Interpretative Letter 88–1, individual size of the two percentages (i.e., 5 application of Advisory 87–2, as described in an ‘‘Application of Division of Trading and Markets percent or less, between 5 percent and 10 percent, Addendum to CFTC Advisory 87–2 ([1986–87 Advisory 87–2,’’ [1987–1990 Transfer Binder] or 10 percent or more) and the difference between Transfer Binder] Comm. Fut. L. Rep. (CCH) ¶ 23,759 Comm. Fut. L. Rep. (CCH) ¶24058 at 34639–40 the two percentages. See 58 FR at 8229. (August 12, 1987)). (December 16, 1987).

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allocation provides insight into the who chooses to partially fund will participants to think of the ‘‘cash they return based on ‘‘actual’’ funds. experience volatility magnified by his or have put up’’ as the limit of their losses her partial funding level, and will not be could run afoul of Section 4o of the 3. Objections to the Nominal Account helped by the fact that other Commodity Exchange Act (the ‘‘Act’’).22 Size Method Addressed participants chose to fully fund in the To be sure, the Commission has Concerns have been raised that CTAs past. Conversely, a prospective observed that there is no standard might manipulate their nominal account participant who chooses to fully fund among CTAs for the setting of nominal sizes.19 A CTA that can establish will experience volatility corresponding account sizes.23 The Commission does nominal account sizes without being to the nominal account size, and will not intend to impose a standard for the required to find customers willing to not be harmed by the fact that other setting of nominal account sizes on fully fund accounts at such sizes might participants chose to partially fund in CTAs. The proposed rule does require be unrestrained in setting the nominal the past. Moreover, the performance that the CTA disclose the factors it account size, and thus could minimize table will contain a pointed numerical considers in determining the level of the apparent size of losses and smooth example of the effect of partial funding trading for a given nominal account size the apparent volatility of its trading over on volatility in the context of worst in the offered trading program and an time. Increasing the nominal account monthly and peak-to-valley draw- explanation of how those factors are size to minimize the apparent size of downs. This example–based either on applied. Moreover, adopting nominal losses, however, will unavoidably have the lowest actual funding level or a account size as the denominator for the the effect of minimizing the apparent straight 20% funding level—will rate of return calculation would provide size of gains. CTAs will thus be faced demonstrate the enhanced volatility of a uniform basis for all CTAs to present with countervailing incentives. Some partially funded accounts in a form rate of return, which does not exist have noted a converse problem posed by calculated to draw the participant’s under the reporting scheme that has the existing rules: futures and attention. been in effect since the adoption of derivatives positions can be taken by Investors should consider not only the Advisory 93–13. Use of nominal depositing very small amounts of actual ‘‘cash they must put up’’ initially, but account size would permit a much more funds for margin, relative to the value of the losses to which they are exposed. In meaningful comparison of the the contract. Positive rates of return this context, participation in managed performance results of CTAs. computed on the basis of a relatively futures accounts is far different from After consideration of the benefits and small amount of actual funds in investment in stocks, real estate, or even drawbacks of each of these methods of accounts whose level of trading is based commodity pools. As has been noted: calculating CTAs’ rates of return, the on a much greater nominal account size ‘‘Commodity trading intrinsically Commission is proposing the nominal would be magnified and could provide involves leverage, the only purchase is account size method, coupled with a a potentially misleading measure of the a futures contract (not the actual asset) framework of documentation and CTA’s success. As NFA’s comment and the amount of cash required is disclosure requirements, as the method letter on the earlier rule amendment artificially determined by exchange that best reflects the reality of how proposal observed, in its experience, rules, broker policies, CTA negotiated managed accounts are traded, including ‘‘* * * unwary customers are more agreements and regulatory requirements information regarding volatility and likely to be lured into the futures and can change day by day.’’ 20 draw-downs. As discussed more fully markets by allusions to large profits Investments in stock, real estate, or below, the existence of a written than by information implying that collective investment vehicles such as agreement that documents the nominal futures trading is a conservative mutual funds or commodity pools can account size in advance of the CTA’s investment.’’ The Commission’s own be quantified in advance, even if trading for the account is a critical experience in this area has been similar, purchased on margin or through other component of the performance and it has no basis to believe that this borrowing. An investor can purchase calculation and reporting scheme the proposal creates any additional 100 shares of Example Co., Inc. (or Commission is proposing. incentives for CTAs to set unreasonable Example Fund, Inc.) at $50 a share for B. Documentation of Nominal Account nominal account sizes. $5,000. Even if these shares are Some have stated that using nominal Size purchased on margin, $5,000 is account size to compute rates of return generally the limit of the loss to which The proposed rules would add new would create an appearance of lowered the investor is exposed.21 This relative paragraph (c) to Rule 4.33 to require volatility and that disclosure of certainty is absent in the context of documentation of the nominal account volatility experienced by program futures. A managed futures account size agreed upon by the CTA and client, participants would be undermined if participant who enters into, for as well as other terms applicable to the nominal account size were used to example, a stock index futures contract CTA’s trading for the client’s account. compute rates of return. But the rules gains (or loses) the change in value of This provision would require that the proposed in this release are no more the collection of stocks. The participant CTA execute a written agreement with likely to mask volatility than the fully- each client that specifies: The nominal funded subset method permitted since must post margin, but the margin does not represent the limit of the account size; the name or description of 1993. The funding level—full or the trading program in which the client partial—chosen by past participants participant’s liability. If the participant’s losses exceed the initial margin, the is participating; the basis for the neither helps nor harms prospective computation of fees; how additions or participants who will be receiving past participant will owe the excess. Commission Rule 4.34(b) requires that withdrawals of actual funds, or profits performance data based on nominal and losses will affect each of (a) the account size. A prospective participant CTAs disclose these facts to prospective clients, and a CTA which encouraged nominal account size and (b) the computation of fees; and whether the 19 See, e.g., ‘‘Proposed Rule Could Help Mask client will fully or partially fund the Commodity Trading Volatility,’’ New York Times, 20 Arthur F. Bell, Jr. & Associates commenting on September 2, 1999; and ‘‘Commodity-Adviser the earlier rule amendment proposal. Reporting Rule May Change,’’ Wall Street Journal, 21 Transaction fees and interest are being ignored 22 7 U.S.C. 6o (2000). September 7, 1999. for the purposes of these examples. 23 See 63 FR 33297 (June 18, 1998).

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account. The requirement that the Additional changes are being proposed valuable by prospective clients. In nominal account size must be to codify definitions of nominal account addition, CTAs would not be precluded documented in advance of the CTA’s size (Rule 4.10(m)), actual funds (Rule from disclosing the aggregate of nominal trading for the client’s account will also 4.10(n)), partially-funded account (Rule account sizes, and in fact may choose to minimize the possibility that CTAs will 4.10(o)) and most recent five years present such information in their manipulate their returns to appear (4.10(p)). performance capsules adjacent to the either less volatile or more positive by The Commission wishes to make clear disclosure of actual funds under frequent adjustment of their nominal that Advisories 87–2 and 93–13, as well management (See proposed Rule account sizes, particularly since any as Interpretative Letter 88–1, would be, 4.35(a)(1)(ix)(D)). Therefore, the revision to the nominal account size on a prospective basis, superseded in Commission is proposing revisions to must be documented in a new their entirety by the proposed rules or Rule 4.35(a)(1)(iv). agreement, or an addendum to the any final rules resulting from this To accommodate those situations existing agreement, signed by the client. rulemaking. Questions have been raised where CTAs do not have access to The Commission believes that about the continuing applicability of the information regarding clients’ actual documentation of the agreement quantitative materiality standard that funds, proposed Rule 4.35(a)(1)(iv) between CTAs and their clients is was established in Advisory 93–13 to would permit a CTA simply to make a important, even if all the CTA’s client determine whether a CTA’s accounts statement of the fact that it does not accounts are fully-funded, and therefore qualified for use of the fully-funded have sufficient information regarding the proposed requirements of Rule subset method. Although Advisory 93– the funding of its clients’ accounts to 4.33(c) would apply to CTAs whether or 13 clearly stated that the standard was determine the aggregate of actual funds not they accept partially funded intended to be applicable only in the committed to its programs. Cases accounts. As the proposed rule context of the Advisory, the involving the use of master accounts, or indicates, CTAs would not need to use Commission understands that these other funding arrangements between the a separate agreement to respond to the standards have come to be relied on client and FCM, that preclude the CTA requirements specified in Rule 4.33(c), more broadly in ascertaining from having access to information but could incorporate the requirements compliance with composite regarding the client’s actual funds, into their existing client agreements. performance requirements of Rule might lead CTAs to state that they do In addition, Rule 4.33(c) would 4.35(a)(3). The Commission would not know the amount of actual funds. require that changes to nominal account accept those standards as guidance, but The representation by the CTA of its size, other than those explicitly not to the exclusion of other approaches lack of knowledge of this amount will provided for in the existing agreement that may fall outside the threshold of provide clients with valuable (e.g., the effect of gains/losses), must be Advisory 93–13. Registrants should information regarding the extent to in writing, must be signed by the client, continue to consider all relevant facts which they may rely on that factor. The and must explicitly indicate the current and circumstances in making CTA would continue to be required to date, the change in the nominal account determinations regarding materiality. maintain the documentation on which its performance presentation is based 27 size and the effective date of that D. Disclosure of Actual Funding Levels 24 and such documentation should be change. This requirement could be and Funds Under Management met by a simple one-sentence note from sufficient to support the information in The Commission believes that it the client requesting the change in the performance capsule regarding the would be misleading to describe nominal account size and including the disclosure, if any, of actual funds under ‘‘notional funds,’’ which the client has dollar amount of the new nominal management. chosen not to place in an account over account size, the effective date of the which the CTA has trading authority, as E. Disclosures Regarding Partial change, the signature and typed or ‘‘funds under management.’’ The Funding of Accounts printed name of the client, and the date proposed revisions to Rule Proposed Rule 4.34(p) would require the request was signed.25 4.35(a)(1)(iv), therefore, would clarify disclosure to prospective clients of C. Changes to Definitions that the disclosure of funds under material information concerning the The Commission proposed revisions management must reflect only the actual practice of partially funding an account to Rule 4.10(l) to accommodate use of funds committed to the CTA’s trading and the factors considered by the CTA nominal account size as the program rather than the aggregate of in determining the trading level for a denominator in the calculation of the nominal account sizes. given nominal account size. The The Commission’s proposed adoption peak-to-valley draw-down figures.26 discussion would be required to of nominal account size for purposes of include: (1) How the management fees 24 The effective date would be on or after the date computing the CTA’s trading program would be computed, expressed as a that the change is made. rate of return is not intended to percentage of the nominal account size, 25 Commission Rule 1.4 permits use of electronic eliminate the distinction between actual and an explanation of the effect of signatures with respect to compliance with funds and nominal account size. As we partially funding an account on the Commission rules that require a document to be have noted before, nominal account size management fees as a percentage of signed by a customer, participant or client. An electronic signature could therefore be used for the is not a commitment of actual funds to actual funds; (2) an estimated range of agreement required by Rule 4.33(c), in accordance the CTA’s control, nor does it represent the commissions generally charged to an with the provisions of Rule 1.4 (i.e., that the the maximum amount of the client’s account expressed as a percentage of the electronic signature complies with applicable potential losses or of the client’s nominal account size and an Federal laws and other Commission rules, and that the CTA must adopt and utilize reasonable obligations to the FCM. The explanation of the effect of partially safeguards regarding the use of electronic Commission continues to believe that funding an account on the commissions signatures). knowledge of the amount of funds that as a percentage of actual funds; (3) a 26 Rule 4.10(k) defines ‘‘draw-down’’ as ‘‘losses a CTA’s clients have been willing to statement that partial funding increases experienced by a pool or account over a specified period.’’ Since the definition in Rule 4.10(k) does entrust to the control of the CTA, or the leverage, that leverage will magnify both not refer to a method for computing such losses, no fact that the CTA does not possess such revision to this definition would be necessary. information, may be considered 27 See Rules 4.33(a) and 4.35(a)(6)(ii).

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positive and negative rates of return, Proposed Rule 4.35(a)(1)(ix)(A) would information is not specifically required and that the greater the disparity require the addition of only two by these regulations. between the nominal account size and percentage draw-down figures, adjacent G. Treatment of Interest Income the amount deposited, maintained or to the worst monthly and peak-to-valley made accessible to the FCM, the greater draw-down percentages for the The proposed definition of net the likelihood and frequency of margin aggregate nominal account sizes. This performance in Rules 4.10(l)(3) and 31 calls, and the greater the size of margin would not amount to data overload. 4.35(a)(6)(i)(B) would permit CTAs to calls as a percentage of the amount of Further, since the intent of the include interest income on funds actual funds committed to the disclosure is to convey the impact of deposited in the client’s commodity commodity trading advisor’s program; draw-downs on the actual funds in interest account directed by the CTA, as and (4) a description of the factors partially-funded accounts, use of the well as any other income on positions considered by the CTA in determining 20% funding level where CTAs do not held as part of the CTA’s program. The the level of trading for a given nominal have any accounts with actual funding fact that trading fees are charged against account size in the offered trading or do not know the amount of actual the CTA’s performance, even where the commission rate is negotiated by the program and an explanation of how funds would enable their performance client and the FCM, supports the those factors are applied. capsules to convey information about inclusion of interest earned at the FCM the increased impact of draw-downs on F. Disclosures Concerning Draw-down in the CTA’s performance to maintain the actual funds in partially-funded parity. In addition, interest is, in a real 1. Disclosure of Draw-Down at the accounts. Lowest Funding Level sense, part of the return on the funds. 2. Use of Composite Draw-down Regardless of the amount of actual funds Proposed Rule 4.35(a)(1)(ix)(A) would Proposed Rules 4.35(a)(1)(v) and (vi) a client deposits with the FCM, whether require CTAs who accept partially- would require that the worst monthly influenced by the CTA’s trading funded accounts to present draw-down and peak-to-valley draw-down amounts strategies, the FCM’s credit figures computed on the basis of the be based on the aggregate of nominal determination, or the client’s wishes, actual funds committed to the CTA’s account sizes, i.e., the composite of income on these funds is part of the program by the client with the lowest accounts, rather than the worst account’s performance. Further, the ratio of actual funds to nominal account individual account.29 A variety of computation of net performance under size in the trading program.28 If the CTA factors, including, but not limited to, the regulations that have been in effect did not have sufficient information differences due to trade execution, fees, since 1981 has included interest regarding the funding level of its client commissions, and the timing of opening income. The components of net accounts, or if the lowest ratio was zero, or closing accounts, may have an impact performance—the numerator of the rate the draw-down information would be on the returns for individual accounts. of return computation—will not be presented at a funding level of 20 The effect of these factors must be affected by the change of the percent. These additional draw-down considered by the CTA in the denominator from net asset value to figures would be presented adjacent to development of its composite nominal account size. It is the adoption the worst monthly and peak-to-valley performance tables and any material of nominal account size, rather than net draw-down percentages based on the differences among the accounts in the asset value, as the basis for performance aggregate nominal account sizes. composite must be discussed.30 For a calculation that will require changes to If a client funds its account traded by performance table that complies with the definition of net performance in the CTA at a level of actual funds that the Commission’s rules on use of proposed Rules 4.10(l)(3) and is less than the nominal account size, composites, disclosure of draw-down 4.35(a)(6)(i)(B). The proposed rule also would provide then gains or losses will represent a information on a composite basis would that no interest income may be imputed larger percentage of the client’s actual not be misleading. However, CTAs with respect to nominal account sizes or funds. Further, the smaller the amount would remain subject to the otherwise computed on a pro-forma of actual funds is in relation to the requirement of Rule 4.34(o) to disclose basis. The Commission notes that the nominal account size, the faster losses all material information to existing or reference in the proposed rules to ‘‘other will reduce the amount of actual funds, prospective clients even if such increasing both the likelihood of margin income’’ on instruments held as part of the CTA’s program is intended to apply calls and the amount of additional 29 Current Rule 4.10(k) defines the term ‘‘Draw- to programs in which the CTA may margin that may be required. The down as ‘‘losses experienced by a pool or account purpose of disclosing draw-downs at the over a specified period: Rule 4.10(l) defines the direct the trading of instruments, such least-funded level is to highlight these term ‘‘Worst peak-to-valley draw-down’’ for a pool, as stocks or bonds, on which income is account or trading program. In its adopting release 32 effects to prospective clients who may earned. While this provision may not for the most recent revisions to the Part 4 rules, the be applicable to most CTAs, it is be considering partially funding their Commission noted that ‘‘ . . . the draw-down figures accounts with the CTA. The option of in a composite in a CTA Disclosure Documents are intended to permit those CTAs who using a 20% level is intended to the worst experienced by any one of the accounts direct the trading of income-producing included in the composite’’ (emphasis added). 60 accommodate situations where the CTA FR 38146, 38162 (July 25, 1995). 31 Although net performance is defined in the does not have sufficient information 30 Rule 4.35(a)(3) states: context of both Rule 4.10(l), with respect to regarding the funding level of its client (i) Unless such presentation would be misleading, computation of worst peak-to-valley draw-down, accounts, or where the lowest funding the performance of accounts traded pursuant to the and Rule 4.35(a)(6)(i)(B), with respect to calculation ratio is zero, precluding calculation of a same trading program may be presented in of performance information, the definitions are the composite form on a program-by-program basis meaningful number. same. * * *. 32 While this provision acknowledges that CTAs (ii) Accounts that differ materially with respect to may offer programs that trade instruments in 28 For example, if the lowest funding level is 25 rate of return may not be presented in the same addition to futures contracts, it in no way implies percent and the greatest monthly draw-down is 15 composite. that such activity may be conducted by CTAs percent, the draw-down shown on the basis of (iii) The commodity trading advisor must discuss outside of the appropriate registration or other actual funding would be 60 percent (15 percent ÷ all material differences among the accounts regulatory requirements of agencies with 25 percent). included in a composite. jurisdiction over those instruments.

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instruments as part of their trading existing rules regarding supplemental narrative disclosure of the pool’s programs to reflect the performance of disclosures and material information.33 allocations to its CTAs, as well as the those instruments in their trading use of leverage in determining such I. Treatment of Additions and results. In the disclosure document allocations, continues to be required Withdrawals in Computing Rate of review process and compliance audits, pursuant to existing Rules 4.24(g) and Return close attention would be paid to the 4.24(h). description of the trading program and In proposing to amend Rule other documentation regarding the 4.35(a)(6)(i)(B), the Commission notes III. Transitional Provisions CTA’s direction of income-producing that CTAs would be permitted to The Commission proposes to require instruments included in its performance choose, for their rate of return CTAs and CPOs to comply with the record. computation, one of the following three revisions proposed herein, including the methods: (1) Net performance divided requirement to obtain the H. Range of Rates of Return for Closed by beginning nominal account size; (2) documentation required by new Rule Accounts daily compounded rate of return; or (3) 4.33(c) for both new and existing The Commission proposes to revise net performance divided by the average clients, by no later than the beginning Rule 4.35(a)(1)(viii) to require that the weighted nominal account sizes for the of the calendar quarter that is at least 90 performance capsule for the offered month. These proposed changes would days after the date of publication of the program include, in addition to the incorporate alternative methods of final rules. The Commission seeks number of accounts closed with profits computing rate of return to account for comment on any difficulties anticipated and the number closed with losses, the intramonth additions and withdrawals, in complying with these proposed range of rates of return for the accounts as permitted by the CFTC’s 1991 requirements by that date. CTAs and closed with net lifetime profits and Advisory.34 The Commission is not CPOs would be permitted to adopt these accounts closed with net lifetime losses, proposing to include the Only Accounts changes immediately upon the effective during the five-year period. The Traded Method as an option CTAs may date of the final rules as adopted. Commission believes that disclosing the choose prospectively due to concerns range of rates of return for closed that it allows for accounts to be IV. Request for Comments Regarding a accounts in the offered program excluded entirely from the rate of return Core Principle Alternative provides important summary computation. The Commission will, The Commission has received a information on the variation in returns however, carefully consider proposals number of requests from the managed experienced by individual clients and regarding any alternative method of funds industry that Commission policy will be useful to prospective clients addressing the effect of additions and pertaining to CTA disclosure of past considering participation in the CTA’s withdrawals on the rate of return performance to prospective clients be program. Because the draw-down computation, whether as part of this made consistent with the approach information under the revised rules will rulemaking proposal or otherwise in the undertaken in the securities industry.36 be presented on a composite basis, future. Under Federal securities laws there are presentation of the range of rates of The rule changes proposed herein no rules that mandate the manner in return for closed accounts provides would supersede applicability to CTAs 35 which investment advisers disclose past valuable information on the results of the CFTC’s 1991 Advisory. CTA performance. Generally, investment experienced by individual clients. performance computed in accordance advisers may present past performance The Commission notes that under the with any of the alternative methods in any manner that does not run afoul proposed rule amendments, both the described in the 1991 Advisory for of general anti-fraud provisions.37 It has numbers of accounts closed with periods prior to the date upon which the been suggested that the Commission positive versus negative rates of return, rule changes proposed herein become adopt a core principle in order to as well as the ranges of rates of return effective, however, would not need to be achieve parity with applicable securities for accounts in each category, must be revised. Because commodity pool laws and regulations as they relate to disclosed only for those accounts that performance may only be reported on the disclosure of past performance made both opened and closed within the the basis of actual funds, applicability of by CTAs to prospective clients.38 Such required five-year and year-to-date time the 1991 Advisory to CPOs reporting a core principle would permit CTAs to period. The Commission does not commodity pool performance would be present past performance to prospective believe that this change will diminish unchanged. clients in any manner they choose so the disclosure of material information to J. Disclosure of CTA Performance in long as such information is offered in a prospective clients, because of the CPO Disclosure Documents tendency of clients to quickly close manner that is factual and balanced and accounts that experience large losses. The Commission is proposing changes is not misleading or fraudulent. Accounts that experienced strongly to the presentation of CTA performance Consistent with the intention of the negative returns before the five-year in CPO disclosure documents primarily Commodity Futures Modernization Act time period are likely to have been to conform such presentation with the proposed revisions to Rule 4.35(a)(1). 36 See Transcript from CFTC Roundtable on closed before the end of that time Managed Funds Issues . result of the offered program during the 37 See the Investment Advisers Act of 1940 five-year period are likely to have been 33 See, Commission Rules 4.34(n) and 4.34(o). section 206(4) (15 U.S.C. 80b–6(4)) and Securities experienced by an account that both 34 CFTC Advisory, ‘‘Adjustments for Additions and Exchange Commission Rule 275.206(4)–1(a)(5) and Withdrawals to Computation of Rate of Return (17 CFR 275.206(4)–(1)(a)(5)). For a more complete opened and closed during that period. in Performance Records of Commodity Pool discussion regarding the use of past performance by The Commission wishes to make clear Operators and Commodity Trading Advisors,’’ 56 investment advisers for soliciting clients, see Robert that any additional information that the FR 8109 (February 27, 1991). J. Zutz, Compliance Review, Schwab Institutional, CTA believes is necessary to explain the 35 CFTC Advisory, ‘‘Adjustments for Additions Vol. 10, Issue 8, Aug. 2001. and Withdrawals to Computation of Rate of Return 38 See, e.g., Testimony of George Crapple at the circumstances affecting the ranges of in Performance Records of Commodity Pool CFTC Roundtable on Managed Funds Issues. returns presented in the performance Operators and Commodity Trading Advisors,’’ 56 Transcript from CFTC Roundtable on Managed capsule may be provided, pursuant to FR 8109 (February 27, 1991). Funds Issues at 84.

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of 2000,39 the Commission is requesting would be considered to be small entities The Commission considers comments comment on the desirability of and, if so, the economic impact on them by the public on this proposed implementing a core principle that of any rule.42 In this regard, the collection of information in— would replace the current rules, and Commission notes that the rule Evaluating whether the proposed ameliorate the need for the amendments revisions adopted herein create some collection of information is necessary for the proposed herein, regarding the manner changes to the content of the proper performance of the functions of the in which a CTA presents past documentation and disclosure Commission, including whether the performance to prospective clients. In requirements for CTAs, but do not information will have a practical use; particular, the Commission is requesting increase such requirements, and, in fact, Evaluating the accuracy of the comments on the following questions: are expected ultimately to ease the Commission’s estimate of the burden of the computational and recordkeeping proposed collection of information including (1) What form should such core principle the validity of the methodology and take? Commenters are requested to provide requirements for CTAs who manage assumptions used; specific language for the core principle. partially-funded client accounts. The Enhancing the quality, utility, and clarity (2) Should certain presentations of past Commission has previously determined of the information to be collected; and performance be specifically prohibited or that the disclosure requirements Minimizing the burden of the collection of limited? governing this category of registrant will the information on those who are to respond, (3) Should the rules proposed herein serve not have a significant economic impact including through the use of appropriate as a safe harbor in the event the Commission automated, electronic, mechanical or other determines to adopt a core principle on a substantial number of small 43 technological collection techniques or other approach, and/or should the Commission entities. Therefore, the Chairman, on behalf of the Commission, hereby forms of information technology, e.g., develop more general guidance concerning permitting electronic submissions of compliance with the core principle? certifies, pursuant to 5 U.S.C. 605(b), responses. (4) Would the implementation of a core that these regulations will not have a principle approach lead to more or less significant economic impact on a OMB is required to make a decision meaningful and useful information being substantial number of small entities. concerning the collection of information provided to prospective clients? contained in these proposed regulations (5) Is the experience of the securities B. Paperwork Reduction Act between 30 and 60 days after industry with the use of a core principle These rules [Sections 4.31 and 4.33] publication of this document in the approach for performance presentation relevant to the use of such an approach in the contain information collection Federal Register. Therefore, a comment futures industry? requirements. As required by the to OMB is best assured of having its full Paperwork Reduction Act of 1995,44 the effect if OMB receives it within 30 days In offering the above questions, the Commission has submitted a copy of of publication. This does not affect the Commission does not intend to limit the this rule to the Office of Management deadline for the public to comment to scope of the discussion regarding the and Budget (OMB) for its review.45 the Commission on the proposed alternative of a core principle. These regulations. Collection of Information questions are meant only as a starting Copies of the information collection point and the Commission encourages Rules relating to the operations and submission to OMB are available from the submission of comments that activities of Commodity Pool Operators the CFTC Clearance Officer, 1155 21st address these, as well as any other and Commodity Trading Advisors and Street, NW., Washington, DC 20581 pertinent questions. to monthly reporting by Futures (202) 418–5160. V. Related Matters Commission Merchants, OMB control number 3038–0005. List of Subjects in 17 CFR Part 4 A. Regulatory Flexibility Act The proposed amendments would not Brokers, Commodity futures, The Regulatory Flexibility Act affect the paperwork burdens associated Commodity pool operators, Commodity (‘‘RFA’’), 5 U.S.C. 601–611 (1994), with the above collections of trading advisors. requires that agencies, in proposing information, which have previously In consideration of the foregoing and rules, consider the impact of those rules been approved by OMB in connection pursuant to the authority contained in on small businesses. The Commission with the Commission’s previous the Commodity Exchange Act and, in has previously established certain submission of the proposed rules. particular, sections 1a(4), 4k, 4l, 4m, 4n, definitions of ‘‘small entities’’ to be used Copies of the information collection 4o and 8a, 7 U.S.C. 1a(4), 6k, 6l, 6m, 6n, by the Commission in evaluating the submission to OMB are available from 6o, and 12a, the Commission hereby impact of its rules on such entities in the CFTC Clearance Officer, 1155 21st proposes to amend Chapter I of the Code 40 accordance with the RFA. The Street, NW., Washington, DC 20581, of Federal Regulations as follows: Commission previously has determined (202) 418–5160. that registered CPOs are not small Persons wishing to comment on the PART 4—COMMODITY POOL entities for the purpose of the RFA.41 information collection requirements that OPERATORS AND COMMODITY With respect to CTAs, the Commission would be required by these proposed TRADING ADVISORS has stated that it would evaluate within rules should contact the Office of the context of a particular rule proposal Information and Regulatory Affairs, 1. The authority citation for part 4 whether all or some affected CTAs Office of Management and Budget, continues to read as follows: Room 10235, New Executive Office Authority : 7 U.S.C. 1a, 2, 4, 6b, 6c, 6l, 6m, 39 Pub. L. No. 106–554, 114 Stat. 2763 (2000) Building, Washington, DC 20503, Attn: 6n, 6o, 12a and 23. (codified as amended in scattered sections of 7 Desk Officer for the Commodity Futures U.S.C.). See, e.g., section 125 (requiring the Trading Commission. 2. Section 4.10 is proposed to be Commission to conduct a study of the Act and the amended by revising paragraph (l) and Commission’s rules and orders governing the conduct of registrants under the Act, identifying, 42 47 FR 18618–18620. adding paragraphs (m), (n), (o) and (p) among other things, Commission rules that may be 43 See 60 FR 38146, 38181 (July 25, 1995) and 48 to read as follows: replaced by core principles). FR 35248 (August 3, 1983). 40 47 FR 18618–18621 (April 30, 1982). 44 Pub. L. 104–13 (May 13, 1995). § 4.10 Definitions. 41 47 FR 18619–18620. 45 44 U.S.C. 3504(h). * * * * *

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(l) Worst peak-to-valley draw-down (2) In another account, so long as the (F) The greatest peak-to-valley draw- means: commodity trading advisor has written down during the most recent five years (1) For a commodity pool, the greatest evidence demonstrating the following: for the trading program specified, cumulative percentage decline in (i) The client owns the funds; expressed as a percentage of aggregate month-end net asset value due to losses (ii) The futures commission merchant nominal account sizes at the beginning sustained during any period in which carrying the client’s account that the of the period, and indicating the the initial month-end net asset value is commodity trading advisor directs (the month(s) and year(s) of the draw-down. not equaled or exceeded by a ‘‘trading account’’) has the power * * * * * subsequent month-end net asset value. readily to use all, or a designated 4. Section 4.33 is proposed to be Such decline must be expressed as a portion of, the funds in the other amended by adding paragraphs (c) and percentage of the initial month-end net account for the purpose of meeting (d) to read as follows: asset value, together with an indication margin requirements in connection with of the months and year(s) of such the trading account, on a routine § 4.33 Recordkeeping. decline from the initial month-end net operational basis and without advance * * * * * asset value to the lowest month-end net notice to the client; and (c) A commodity trading advisor must asset value of such decline. (iii) The commodity trading advisor obtain a written agreement signed by (2) For an account directed by a has ready access to information each client which, at a minimum, commodity trading advisor or for a concerning the balance in the other clearly specifies: commodity trading advisor’s trading account available to meet margin (1) The nominal account size; program, the greatest negative net requirements for the trading account. (2) The name or description of the performance during any period, (o) Partially-funded account means a trading program in which the client is beginning at the start of one month, and client participation in the program of a participating; ending at the conclusion of that month commodity trading advisor in which the (3) The basis for the computation of or a subsequent month. The worst peak- amount of actual funds is less than the fees; to-valley draw-down must be expressed nominal account size. (4) How additions or withdrawals of as a percentage of the nominal account (p) For purposes of §§ 4.25 and 4.35, actual funds, profits, and losses will size at the beginning of the period, the term most recent five years means: each affect the nominal account size and together with an indication of the (1) The time period beginning January the computation of fees; and months and year(s) of such draw-down. 1 of the calendar year five years prior to (5) Whether the client will fully or (3)(i) For purposes of paragraph (l)(2) the date of the Disclosure Document and partially fund the account. (d) Any changes to nominal account of this section, net performance for a ending as of the date of the Disclosure size (other than changes resulting from period is defined as the total of: Document; or the factors listed in § 4.33(c)(4) and (A) The realized gain or loss on (2) The life of the trading program, if documented as required by that positions closed during the period; plus less than five years. 3. Section 4.25(a)(1)(ii) is proposed to subsection) must be in writing, must be (B) The change during the period in be amended by revising paragraphs signed by the client, and must explicitly unrealized gain or loss; plus (a)(1)(ii)(D)(1) and (2), (a)(1)(ii)(E) and indicate the current date, the new (C) Interest income on funds on (a)(1)(ii)(F) to read as follows: nominal account size and the effective deposit in an account at a futures date of the change. commission merchant to margin the § 4.25 Performance disclosures. 5. Section 4.34 is proposed to be client account which a commodity (a) * * * amended by adding paragraph (p) to trading advisor directs; plus (1) * * * read as follows: (D) Other income earned on positions (ii) * * * held as part of the commodity trading (D)(1) The aggregate of actual funds § 4.34 General disclosures required. advisor’s program; minus for all of the trading programs of the * * * * * (E) Fees and expenses. trading advisor or other person trading (p) Additional Disclosure by (ii) No interest or other income may the account, as of the date of the Commodity Trading Advisors Accepting be imputed with respect to nominal Disclosure Document or, if the Partially-funded Accounts. A account sizes or otherwise computed on commodity trading advisor does not commodity trading advisor that accepts a pro-forma basis. have sufficient information regarding a partially-funded account (as defined (4) For purposes of §§ 4.25 and 4.35, the funding of its clients’ accounts to in § 4.10(o)) must disclose: a peak-to-valley draw-down, which determine the aggregate of actual funds (1) How the management fees will be began prior to the beginning of the most for its programs, a statement of that fact; computed, expressed as a percentage of recent five calendar years and continues (2) The aggregate of actual funds for the nominal account size, and an into or ends during the most recent five the specified trading program of the explanation of the effect of partially years, is deemed to have occurred commodity trading advisor, as of the funding an account on the management during such five-calendar-year period. date of the Disclosure Document or, if fees as a percentage of actual funds; (m) Nominal account size means the the commodity trading advisor does not (2) An estimated range of the account size, designated in the written have sufficient information regarding commissions generally charged to an agreement specified in § 4.33(c), that the funding of its clients’ accounts to account expressed as a percentage of the establishes the client’s level of trading determine the aggregate of actual funds nominal account size and an in a commodity trading advisor’s for the specified trading program, a explanation of the effect of partially program. statement of that fact. funding an account on the commissions (n) Actual funds means the amount of (E) The greatest monthly draw-down as a percentage of actual funds; margin-qualifying assets, either: during the most recent five years for the (3) A statement that partial funding (1) On deposit in an account at a trading program specified, expressed as increases leverage, that leverage will futures commission merchant to margin a percentage of aggregate nominal magnify both positive and negative rates the client account which a commodity account sizes, and indicating the month of return, and that the greater the trading advisor directs; or and year of the draw-down. disparity between the nominal account

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size and the amount deposited, that were opened and closed during the calculated pursuant to § 4.35(a)(6). This maintained or made accessible to the period specified in § 4.35(a)(5) with a table must be updated at least quarterly. futures commission merchant, the positive net lifetime rate of return as of * * * * * greater the likelihood and frequency of the date the account was closed; and (6) Calculation of, and recordkeeping margin calls, and the greater the size of (2) The range of rates of return for concerning, performance information. margin calls as a percentage of the accounts that were both opened and (i) * * * amount of actual funds committed to closed during the period specified in (A) The nominal account size at the the commodity trading advisor’s § 4.35(a)(5) and closed with positive net beginning of the period, defined as the program; and lifetime rates of return; and previous period’s ending nominal (4) A description of the factors (B)(1) The number of accounts traded account size; considered by the commodity trading pursuant to the offered trading program (B)(1) The net performance for the advisor in determining the level of that were opened and closed during the period, which is defined as the total of: trading for a given nominal account size period specified in § 4.35(a)(5) with (i) The realized gain or loss on in the offered trading program and an negative net lifetime rates of return as of positions closed during the period, plus explanation of how those factors are the date the account was closed; and (ii) The change during the period in applied. (2) The range of rates of return for unrealized gain or loss, plus 6. Section 4.35 is proposed to be accounts that were both opened and (iii) Interest income on funds on amended by revising paragraphs closed during the period specified in deposit in an account at a futures (a)(1)(iv) through (a)(1)(ix), (a)(2)(iv), § 4.35(a)(5) and closed with negative net commission merchant to margin the (a)(6)(i)(A) through (F), and (a)(6)(ii) to lifetime rates of return. client account which a commodity read as follows: (C) The net lifetime rate of return trading advisor directs, plus shall be calculated as the compounded § 4.35 Performance disclosures. (iv) Other income earned on positions product of the monthly rates of return held as part of the CTA’s program, * * * * * for each month the account is open. minus (a) General principles.—(1) * * * (ix) In addition to the information (iv)(A) The aggregate of actual funds (v) Fees and expenses. specified in § 4.35(a)(1)(i)–(viii), where (2) No interest or other income may be for all of the trading programs of the the commodity trading advisor accepts trading advisor or other person trading imputed with respect to nominal partially-funded accounts, the account sizes or otherwise computed on the account, as of the date of the performance capsule must include: Disclosure Document, or, if the a pro-forma basis. (A) A statement that rates of return are (C) The nominal rate of return for the commodity trading advisor does not based on nominal account size. have sufficient information regarding period, which must be compounded no (B) In a column adjacent to the less frequently than monthly and which the funding of its clients’ accounts to presentation of data based on nominal determine the aggregate of actual funds shall be calculated by one of the account size, the draw-down following three methods, consistently for its programs, a statement of that fact; information required by § 4.35(a)(1)(v) (B) The aggregate of actual funds for applied: and (vi), divided by the percentage of the specified trading program of the (1) Computing the net performance actual funds committed to the commodity trading advisor, as of the divided by the beginning nominal commodity trading advisor’s program by date of the Disclosure Document, or, if account size for each trading day in the the client with the lowest ratio of actual the commodity trading advisor does not period and compounding each daily rate funds to nominal account size in the have sufficient information regarding of return to determine the rate of return trading program. the funding of its client accounts to for the period; (1) If the commodity trading advisor determine the aggregate of actual funds (2) Dividing the net performance by does not have sufficient information for the specified trading program, a the arithmetic mean of the nominal regarding the funding level of its client statement of that fact. account sizes for each trading day (v) The greatest monthly draw-down accounts to determine the lowest ratio, during the period; or, during the most recent five years for the or if the lowest ratio is zero, present this (3) Dividing the net performance by trading program specified, expressed as information at a funding level of 20 the nominal account size at the a percentage of aggregate nominal percent. beginning of the period. account sizes, and indicating the month (2) The percentage basis of the (D) Changes to the nominal account and year of the draw-down; computation, i.e., the actual funds ratio size during the period, pursuant to the (vi) The greatest peak-to-valley draw- or the optional 20 percent, must be terms of the commodity trading down during the most recent five years disclosed in the heading of the column. advisor’s agreement with the client in for the trading program specified, (C) If the commodity trading advisor accordance with § 4.33(c)(4). The expressed as a percentage of aggregate elects to include the aggregate of the records should clearly delineate the nominal account sizes at the beginning nominal account sizes of the client source of each change (additions or of the period, and indicating the accounts in the trading program withdrawals of actual funds, profits or month(s) and year(s) of the draw-down; specified, this information must be losses, or otherwise). (vii) Subject to § 4.35(a)(2) for the placed adjacent to the disclosure of (E) Changes to the nominal account offered trading program, the annual and actual funds under management by the size pursuant to the terms of the year-to-date rate-of-return for the commodity trading advisor as required commodity trading advisor’s agreement program specified for each of the five by § 4.35(a)(1)(iv). with the client in accordance with most recent calendar years and year-to- (2) Additional requirements with § 4.33(c)(1). The records should clearly date, computed on a compounded respect to the offered trading program. delineate the source of each change (the monthly basis; and * * * * * opening or closing of accounts during (viii) In the case of the offered trading (iv) The commodity trading advisor the period or changes to nominal program: must make available to prospective and account size specifically directed by a (A)(1) The number of accounts traded existing clients upon request a table client in writing). If a client and the pursuant to the offered trading program showing the information required to be advisor agree that a nominal account

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size be changed effective at the of used goods is a key process in many goods, promotion of economic activity beginning of a period, the change shall such recycling operations. in North America, and protection of the be reflected at the end of the prior DATES: Comments must be received on environment. The Department of the period. or before May 12, 2003. Treasury and Customs Service have (F) The nominal account size at the ADDRESSES: Written comments are to be examined NAFTA’s rules of origin as end of the period, defined as the sum of addressed to the U.S. Customs Service, applied to both recovered and recycled the nominal account size at the Office of Regulations and Rulings, goods. Allowing disassembly to confer beginning of the period Attention: Regulations Branch, 1300 origin under certain circumstances [§ 4.35(a)(6)(i)(A)] and the changes Pennsylvania Avenue, NW., promotes recycling and re- specified in this § 4.35(a)(6)(i) Washington, DC 20229. Submitted manufacturing in North America and subparagraphs (D) and (E). comments may be inspected at U.S. would advance these economic and (ii) All supporting documents Customs Service, 799 9th Street, NW., environmental objectives. necessary to substantiate the Washington, DC during regular business Proposed Rule computation of such amounts must be hours. Arrangements to inspect maintained in accordance with § 1.31. To this end, accordingly, this submitted comments should be made in document proposes to amend the * * * * * advance by calling Mr. Joseph Clark at Customs Regulations to allow Issued in Washington, DC on March 10, (202) 572–8768. components which are recovered from 2003 by the Commission. FOR FURTHER INFORMATION CONTACT: the disassembly of used goods in a Jean A. Webb, Edward M. Leigh, Office of Regulations NAFTA country to be entitled to Secretary of the Commission. and Rulings, (202) 572–8827. NAFTA originating status upon [FR Doc. 03–6081 Filed 3–12–03; 8:45 am] SUPPLEMENTARY INFORMATION: importation to the United States, provided that: (1) The recovered BILLING CODE 6351–01–U Background components satisfy the applicable On December 17, 1992, the United NAFTA rule of origin requirements in States, Canada and Mexico (the parties) Annex 401; and (2) if the rule of origin DEPARTMENT OF THE TREASURY entered into an agreement, the North in Annex 401 applicable to the American Free Trade Agreement (the Customs Service components does not include a regional NAFTA). The provisions of the NAFTA value content requirement, the were adopted by the United States with 19 CFR PART 181 components are subject to further the enactment of the North American processing in the NAFTA country Free Trade Agreement Implementation RIN 1515–AD23 beyond certain specified minor Act, Public Law 103–182, 107 Stat. 2057 operations. Tariff Treatment Related to (December 8, 1993). Treatment of Disassembly as a Disassembly Operations Under the The question has arisen, in the Production Consistent with the Intent of North American Free Trade Agreement context of recycling or re-manufacturing operations, whether disassembly NAFTA AGENCY: Customs Service, Department occurring in a NAFTA country may be Under the proposal, treatment of of the Treasury. considered NAFTA origin conferring disassembly as potentially conferring ACTION: Proposed rule. ‘‘production’’ where the components NAFTA originating status must, of recovered by disassembly satisfy the course, be consistent with the terms and SUMMARY: This document proposes to Annex 401 rules of origin for the objectives of the NAFTA amend the Customs Regulations NAFTA and there is some form of Implementation Act of 1993. Within concerning the North American Free substantial processing performed on the that framework, the most important Trade Agreement (the NAFTA). recovered components. question which must be answered is Specifically, the proposed rule would The NAFTA does not explicitly does ‘‘disassembly’’ constitute origin allow components which are recovered address whether parts or components, conferring ‘‘production’’ within the from the disassembly of used goods in whose origin is non-NAFTA or meaning of that term as defined in a NAFTA country to be entitled to unknown, that are recovered by Article 415 of the NAFTA, as NAFTA originating status when disassembly in a NAFTA country from implemented in 19 U.S.C. imported into the United States, a non-originating good, may qualify as 3332(a)(1)(B)(i) and 3332(p)(22) and in provided that: The recovered NAFTA originating goods if, as a result section 2(1) of the NAFTA Rules of components satisfy the applicable of the disassembly, they satisfy the rules Origin Regulations (Uniform NAFTA rule of origin requirements; and of origin set out in Article 401 and Regulations) (19 CFR part 181, if the applicable rule of origin does not Annex 401 of the NAFTA and are Appendix, section 2(1))? include a regional value content themselves subjected to some form of requirement, the components are subject substantial further processing. A Change in Tariff Classification to further processing in the NAFTA The recovery and recycling of used Resulting from a Production country beyond certain minor goods is an increasingly important Under NAFTA Article 401(b) and 19 operations. element in the economic activity as well U.S.C. 3332(a)(1)(B)(i), a good shall The proposed rule is intended to as the environmental goals of the nation, originate in the territory of a party promote economic activity and the and disassembly, for the recovery of where each of the non-originating protection of the environment in North parts or for the re-manufacturing of a materials used in the production of the America, both of which are goals of the good, is a key process in many recycling good undergoes an applicable change in NAFTA. To this end, the recovery and operations. tariff classification set out in Annex 401 recycling of used goods is a critical The goals of the North American Free as a result of production occurring element in both the economic activity Trade Agreement (NAFTA) include entirely in the territory of one or more and the environmental goals of the elimination of barriers to trade, of the parties. It is therefore understood nation, and disassembly for the recovery facilitation of cross-border movement of that unless it results from an activity

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that qualifies as ‘‘production’’, the mere Circumvention of NAFTA’s Rules of rules of origin. Notwithstanding this fact that there is a prescribed change in Origin; Disassembly of New Products proposal, Customs is particularly tariff classification will not be Moreover, to ensure that disassembly interested in receiving comments on the considered as meeting a rule of origin. is not used to circumvent the intent of contrary view that an applicable value The term ‘‘production’’ is defined in NAFTA, the proposed rule provides content rule or alternative requirement Article 415 of the NAFTA and in 19 that, under certain circumstances, for substantial processing suffice to U.S.C. 3332(p)(22) and is implemented additional operations beyond permit ‘‘production’’ to be considered to in section 2(1) of the Uniform disassembly are required for the have occurred in this case as well. After Regulations (19 CFR part 181, recovered component to acquire NAFTA reviewing the comments, Customs will Appendix, section 2(1)). As noted, the originating status. Specifically, as issue a final rule that will resolve the term, in relevant part, requires a previously outlined, the recovered question definitively. manufacturing, processing or To reflect the above-described component must meet the requirement assembling of a good. Of course, the interpretations of law and substantive of the applicable rule of origin in Annex processes listed here are illustrative, not considerations, this document proposes 401, including any pertinent regional exhaustive, and the absence of the term to add a new § 181.132 to the Customs value content requirement; and, if the ‘‘disassembly’’ is not dispositive of Regulations (19 CFR 181.132). whether or not a disassembly operation applicable rule of origin in Annex 401 Comments is a production process for NAFTA does not include a regional value purposes. content requirement, the recovered Before adopting the proposed A disassembly operation will result in component must be subject to regulation, consideration will be given one or more articles being taken or additional processing beyond certain to any written comments that are timely separated from a manufactured good. minor operations. submitted to Customs. Customs Assuming no further production, these Where there is no regional value specifically requests comments on the various articles are typically classifiable content requirement applicable to the clarity of the proposed rule and how it under tariff provisions (often those for recovered components, the additional may be made easier to understand. ‘‘parts’’ of goods) other than the processing operations necessary to Comments submitted will be available classification of the original good from confer NAFTA originating status must for public inspection in accordance with which the articles were disassembled. involve more than certain minor the Freedom of Information Act (5 Consequently, if disassembly is treated operations which are enumerated as U.S.C. 552), § 1.5, Treasury Department as production and any other follows: (1) Cleaning or sterilizing, Regulations (31 CFR 1.5) and requirements are satisfied, the recovered including removal of rust, grease, paint, § 103.11(b), Customs Regulations (19 component may satisfy the NAFTA or other coatings; (2) Application of CFR 103.11(b)), at the U.S. Customs rules of origin. preservative or decorative coatings, Service, 799 9th Street, NW., including lubricants, protective Disassembly as a Production Process Washington, DC during regular business encapsulation, preservative or hours. Arrangements to inspect Upon review, we find no evidence decorative paint, or metallic coatings; submitted comments should be made in (beyond the failure to explicitly include (3) Trimming, filing or cutting off small advance by calling Mr. Joseph Clark at disassembly in the illustrative list of amounts of excess materials (precision (202) 572–8768. ‘‘production’’ activities in NAFTA machining, however, is not to be Article 415) showing that the NAFTA considered a minor operation); (4) Regulatory Flexibility Act and intended not to treat ‘‘disassembly’’ as Unloading, reloading or any other Executive Order 12866 a production process. Use of the term operation necessary to maintain the The proposed rule is intended to ‘‘processing’’ includes a broad range of good in good condition; (5) Packing, re- promote economic activity as well as economic activity within production. packing, packaging or repackaging; or the protection of the environment in Recycling operations for the recovery by (6) Testing, marking, sorting, or grading. North America, both of which are goals disassembly of reusable components Customs has also examined whether a of the NAFTA. Specifically, the such as automotive parts and producer might use disassembly of new recovery and recycling of used goods is photocopier or computer parts goods to circumvent the intent of the a critical element in both the economic constitute identifiable business NAFTA. A new non-NAFTA product activity and the environmental goals of operations within the NAFTA territories could be imported into Mexico or the nation, and disassembly, for the and the free trade purposes of NAFTA Canada, disassembled, and the recovery or re-manufacturing of used (discussed above) would be satisfied by disassembled parts could then be goods, is a key process in many such establishing rules under which imported into the United States and operations. Hence, pursuant to the substantial ‘‘production’’ consistent either re-assembled or used as parts. provisions of the Regulatory Flexibility with those purposes will be deemed to Customs believes that a change in tariff Act (5 U.S.C. 601 et seq.), it is certified occur. Recycling operations based on classification resulting from the that the proposed rule, if adopted, will certain repair or alteration operations disassembly of new, non-originating not have a significant economic impact already have been given appropriate goods should not make the resulting on a substantial number of small recognition under NAFTA Article 307. goods eligible for originating status. entities. Accordingly, it is not subject to Equally, operations based on the Because the disassembly of new goods the regulatory analysis or other recovery of certain waste or scrap may potentially be treated as a requirements of 5 U.S.C. 603 and 604. materials have been designated in the circumvention activity within the Nor does the proposed rule result in a NAFTA rules of origin as conferring meaning of section 17 of the Uniform ‘‘significant regulatory action’’ under origin where such operations take place Regulations (19 CFR part 181, E.O. 12866. (NAFTA Article 415). It is thus Appendix, section 17), the proposed consistent with the NAFTA to treat the rule provides that the disassembly of List of Subjects in 19 CFR Part 181 recovery of useable goods by new goods shall not be considered to be Administrative practice and disassembly as ‘‘production’’ under the ‘‘production’’ for the purposes of procedure, Canada, Customs duties and NAFTA rules of origin. NAFTA Article 415 and the NAFTA inspection, Imports, Mexico, Trade

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agreements (North American Free-Trade (a) of this section will not be considered 5239; fax number: (703) 308–3259; e- Agreement). a production in the case of components mail address: [email protected]. that are recovered from new goods. Proposed Amendments to the SUPPLEMENTARY INFORMATION: (c) Automotive components/goods. Regulations Notwithstanding the provisions of I. General Information It is proposed to amend part 181, Schedule V (Automotive Goods) of the A. Does this Action Apply to Me? Customs Regulations (19 CFR part 181), Appendix to this part, the rule set forth This action is directed to the public as set forth below. in this section applies for purposes of in general and may be of particular determining whether goods of that PART 181—NORTH AMERICAN FREE interest to persons who manufacture, Schedule are originating. TRADE AGREEMENT sell or use pesticides or who are part of Robert C. Bonner, a State or Tribe engaged in the 1. The authority citation for part 181 regulation of pesticide products and to would continue to read as follows: Commissioner of Customs. Approved: February 18, 2003. groups interested in environmental Authority: 19 U.S.C. 66, 1202 (General Timothy E. Skud, regulation. The Agency has not Note 23, Harmonized Tariff Schedule of the Deputy Assistant Secretary of the Treasury. attempted to describe all the specific United States), 1624, 3314. entities that may be affected by this [FR Doc. 03–6051 Filed 3–12–03; 8:45 am] 2. Subpart L of part 181 is amended action. If you have any questions by adding a new § 181.132 to read as BILLING CODE 4820–02–P regarding the applicability of this action follows: to a particular entity, consult Arthur- Jean Williams at the telephone number/ § 181.132 Disassembly. ENVIRONMENTAL PROTECTION e-mail address listed under FOR FURTHER (a) Treated as a production. For AGENCY INFORMATION CONTACT. purposes of implementing the rules of origin provisions of General Note 12, 40 CFR Chapter I B. How Can I Get Copies of this HTSUS, and Chapter Four of the Document and Other Related [OPP–2003–0010; FRL–7298–9] NAFTA, except as provided in Information? paragraph (b) of this section, RIN 2070–AD72 1. Docket. EPA has established an disassembly is considered to be official public docket for this action Endangered Species and Pesticide production, and a component recovered under docket identification (ID) number Regulation; Reopening of Comment from a good disassembled in the OPP–2003–0010. The official public Period territory of a Party will be considered to docket consists of the documents be originating as the result of such AGENCY: Environmental Protection specifically referenced in this action, disassembly provided that: Agency (EPA). any public comments received, and (1) The recovered component satisfies other information related to this action. all applicable requirements of Annex ACTION: Advance notice of proposed rulemaking; reopening of comment Although a part of the official docket, 401 and this part; and the public docket does not include (2) Where the rule in Annex 401 period. Confidential Business Information (CBI) applicable to the recovered component or other information whose disclosure is does not include a regional value SUMMARY: This document reopens the content requirement, the recovered public comment period established in restricted by statute. The official public component is thereafter advanced in an advance notice of proposed docket is the collection of materials that value or improved in condition by rulemaking (ANPR) issued in the is available for public viewing at the means of additional processing Federal Register of January 24, 2003. In Public Information and Records operations other than those listed that document, EPA sought comment on Integrity Branch (PIRIB), Rm. 119, below. Merely processing by performing an ANPR for an endangered species and Crystal Mall #2, 1921 Jefferson Davis any or all of the following minor pesticide regulation. EPA is hereby Hwy., Arlington, VA. This docket operations would not be sufficient to be reopening the comment period, which facility is open from 8:30 a.m. to 4 p.m., considered production: ended on March 10, 2003. The new Monday through Friday, excluding legal (i) Cleaning or sterilizing, including comment period will end March 25, holidays. The docket telephone number removal of rust, grease, paint, or other 2003. is (703) 305–5805. 2. Electronic access. You may access coatings; DATES: Comments, identified by the this Federal Register document (ii) Application of preservative or docket ID number OPP–2003–0010, electronically through the EPA Internet decorative coatings, including must be received on or before March 25, under the ‘‘Federal Register’’ listings at lubricants, protective encapsulation, 2003. preservative or decorative paint, or http://www.epa.gov/fedrgstr/. A ADDRESSES: Comments may be frequently updated electronic version of metallic coatings; submitted electronically, by mail, or (iii) Trimming, filing or cutting off 40 CFR Chapter I is available at http:/ through hand delivery/courier. Follow small amounts of excess materials /www.access.gpo.gov/nara/cfr/ the detailed instructions as provided in _ _ _ (precision machining, however, is not cfrhtml 00/Title 40/40cfr1 00.html, a Unit I. of the SUPPLEMENTARY considered a minor operation); beta site currently under development. (iv) Unloading, reloading or any other INFORMATION of the January 24, 2003 An electronic version of the public operation necessary to maintain the Federal Register document. docket is available through EPA’s good in good condition; FOR FURTHER INFORMATION CONTACT: electronic public docket and comment (v) Packing, re-packing, packaging or Arthur-Jean Williams, Field and system, EPA Dockets. You may use EPA repackaging; or External Affairs Division (7506C), Office Dockets at http://www.epa.gov/edocket/ (vi) Testing, marking, sorting, or of Pesticide Programs, Environmental to submit or view public comments, grading. Protection Agency, 1200 Pennsylvania access the index listing of the contents (b) Exception; new goods. Ave., NW., Washington, DC 20460– of the official public docket, and to Disassembly as provided in paragraph 0001; telephone number: (703) 305– access those documents in the public

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docket that are available electronically. IV. What is the Agency’s Authority for requests we received in a timely manner Although not all docket materials may Taking this Action? from interested parties throughout the be available electronically, you may still The ANPR was issued under the nation. The EPA is also announcing the access any of the publicly available authority of section 7 of the Endangered establishment of a comment line for the docket materials through the docket Species Act (ESA), as amended, 16 public to call and leave verbal facility identified in Unit I.B.1. Once in U.S.C. 1531 et seq., and the Federal comments on these proposed changes. the system, select ‘‘search,’’ then key in Insecticide, Fungicide, and Rodenticide The number is (919) 541–0211. the appropriate docket ID number. Act (FIFRA), 7 U.S.C. 136 et seq. Comments received through this phone number will be logged and placed in C. How and to Whom Do I Submit V. Do Any Statutory and Executive Docket No. A–2002–04. Comments? Order Reviews Apply to this Action? DATES: The public hearings will To submit comments, or access the No. This action merely extends the convene at 9 a.m. and will end at 10 official public docket, please follow the date by which public comments must be p.m. on March 31, 2003. Times are local detailed instructions as provided in submitted to EPA on an ANPR that for each hearing location. Unit I. of the SUPPLEMENTARY previously published in the Federal ADDRESSES: The public hearings will be INFORMATION of the January 24, 2003 Register of January 24, 2003 (68 FR held at the following five locations Federal Register document. If you have 3785). For information about the simultaneously: questions, consult the person listed applicability of the regulatory 1. Albany Marriott Hotel, 189 Wolf under FOR FURTHER INFORMATION assessment requirements to the ANPR, Road, Albany, NY 12205, Phone 518– CONTACT. please refer to the discussion in Unit IV. 458–8444; of that document (68 FR 3785). 2. Doubletree Hotel Dallas, 5410 LBJ II. Background Freeway, Dallas, TX 75240, Phone (972) List of Subjects 934–8400; On January 24, 2003, EPA, in Environmental protection, 3. Crowne Plaza Hotel, 8000 conjunction with the Fish and Wildlife Endangered species, Pesticides. Merriman Road, Romulus, MI 48174, Service, U.S. Department of the Interior, Phone 734–729–2600; and National Marine Fisheries Service, Dated: March 10, 2003, 4. U.S. Environmental Protection National Oceanic and Atmospheric Stephen L. Johnson, Agency, 109 TW Alexander Drive, Administration, U.S. Department of Assistant Administrator, Office of Prevention, Research Triangle Park, North Carolina Commerce, issued a Federal Register Pesticides and Toxic Substances. 27709, Building C, Auditorium C111, document (68 FR 3785) (FRL–7287–3) [FR Doc. 03–6188 Filed 3–11–03; 2:49 pm] phone 919–541–5319; and seeking public comment on an ANPR BILLING CODE 6560–50–S 5. Hilton Salt Lake City Center, 255 for an endangered species and pesticide South West Temple, Salt Lake City, UT regulation. 84101, Phone 801–328–2000. ENVIRONMENTAL PROTECTION Among the comments received thus Documents related to this proposed AGENCY far was a request, signed by 30 groups, rulemaking are available for public for an extension of the comment period inspection in the EPA Air Docket No. 40 CFR Parts 51 and 52 A–2002–04. by 45 days. While the agencies appreciate the need to provide adequate [AD–FRL–7466–9] FOR FURTHER INFORMATION CONTACT: Mr. Dave Svendsgaard at (919) 541–2380, opportunity for public input, the RIN 2060–AK28 agencies believe a shorter extension is telefax (919) 541–5509, E-mail: warranted for several reasons. First, Prevention of Significant Deterioration [email protected] or by mail at numerous comments were already (PSD) and Nonattainment New Source U.S. Environmental Protection Agency, received during the original comment Review (NSR): Routine Maintenance, OAQPS, Information Transfer and period. Second, the January 24, 2003 Repair and Replacement Program Integration Division, (C339– 03), Research Triangle Park, North Federal Register notice was an ANPR. AGENCY Carolina 27711. As of the date of this Thus, the public will have further : Environmental Protection announcement, the Agency intends to opportunity to comment with future Agency (EPA). proceed with the hearings as publication of a notice of proposed ACTION: Announcement of public announced; however, unforeseen rulemaking. hearings and a public comment line. circumstances may result in a III. What Action is EPA Taking? SUMMARY: The EPA is announcing five postponement. Therefore, members of public hearings to be held on March 31, the public planning to attend any of Since EPA has an electronic docket 2003, on the December 31, 2002, these hearings are advised to contact system that allows distribution of proposal to revise the regulations Ms. Chandra Kennedy, U.S, materials more easily to interested governing the NSR programs mandated Environmental Protection Agency, persons, EPA agreed to take by parts C and D of title I of the Clean OAQPS, Information Transfer and responsibility for all of the Air Act (CAA). The proposed changes Program Integration Division, (C339– administrative duties related to provide a future category of activities 03), Research Triangle Park, North publication of the ANPR and this that would be considered to be routine Carolina 27711; telephone (919) 541– document, including the creation of a maintenance, repair and replacement 5319 or E-mail public docket, receipt of public (RMRR) under the NSR program. See 67 [email protected], to confirm comments, and other related matters. FR 80290. The public hearings will the locations and date of the hearings. Therefore, EPA, on behalf of the three provide interested parties the You may also check our New Source agencies, hereby reopens the comment opportunity to present data, views, or Review website at http://www.epa.gov/ period, which ended on March 10, 2003. arguments concerning these proposed nsr for any changes in the date or The new comment period will end changes. The EPA is holding the public locations. If you would like to speak at March 25, 2003. hearings because of the number of the any of these hearings, you should also

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contact Ms. Chandra Kennedy. ADDRESSES: All comments should be establishes, and we will not take further Presentations will be limited to 5 addressed to: Raymond Werner, Chief, action on this proposal. If we receive minutes each. Air Programs Branch, Environmental comments that oppose this action, we SUPPLEMENTARY INFORMATION: The EPA’s Protection Agency, Region II Office, 290 will withdraw the immediate final rule, planned seating arrangements for the Broadway, New York, New York 10007– and it will not take effect. We will then hearings is theater style, with seating 1866. respond to public comments in a later available on a first come first served Copies of the State submittal are final rule based on this proposal. You basis for about 250 people. An agenda available at the following addresses for may not have another opportunity for will be provided at the hearings. inspection during normal business comment. If you want to comment on Dated: March 7, 2003. hours: this action, you must do so at this time. Environmental Protection Agency, Henry C. Thomas, DATES: Send your written comments by Region II Office, 290 Broadway, 25th April 14, 2003. Acting Director, Office of Air Quality Planning Floor, New York, New York 10007– and Standards. ADDRESSES: Send written comments to 1866. Joanne Cassidy, Mailcode 3WC21, [FR Doc. 03–6186 Filed 3–12–03; 8:45 am] New York State Department of RCRA State Programs Branch, U.S. EPA BILLING CODE 6560–50–P Environmental Conservation, Division Region III, 1650 Arch Street, of Air Resources, 625 Broadway, 2nd Philadelphia, PA 19103, Phone number: Floor, Albany, New York 12233. ENVIRONMENTAL PROTECTION (215) 814–3381. You may inspect and AGENCY FOR FURTHER INFORMATION CONTACT: copy Virginia’s application from 8:15 Anthony (Ted) Gardella, Air Programs a.m. to 4:30 p.m. at the following 40 CFR 62 Branch, Environmental Protection locations: Virginia Department of Agency, 290 Broadway, 25th Floor, New [Region II Docket No. NY58–253b; Environmental Quality, 629 East Main FRL–7464–7] York, New York 10278, (212) 637–4249. Street, Richmond, VA 23219, Phone SUPPLEMENTARY INFORMATION: For Number: (804) 698–4213, attn: Robert Approval and Promulgation of additional information see the direct Wickline; or Virginia Department of Implementation Plans for Designated final rule which is located in the Rules Environmental Quality, West Central Facilities; NY Section of this Federal Register. Regional Office, 3019 Peters Creek Road, AGENCY: Environmental Protection Dated: March 3, 2003. Roanoke, VA 24015, Phone Number: Agency (EPA). Jane M. Kenny, (540) 562–6872, attn: Aziz Farahmand; or EPA Region III, Library, 2nd Floor, ACTION: Proposed rule. Regional Administrator, Region 2. [FR Doc. 03–5909 Filed 3–12–03; 8:45 am] 1650 Arch Street, Philadelphia, PA SUMMARY: The Environmental Protection 19103–2029, Phone Number: (215) 814– BILLING CODE 6560–50–P Agency (EPA) is proposing to approve 5254. the State plan submitted by New York FOR FURTHER INFORMATION CONTACT: State to implement and enforce the ENVIRONMENTAL PROTECTION Joanne Cassidy, Mailcode 3WC21, Emission Guidelines (EG) for existing AGENCY RCRA State Programs Branch, U.S. EPA small Municipal Waste Combustion Region III, 1650 Arch Street, (MWC) Units. New York’s plan 40 CFR Part 271 Philadelphia, PA 19103, Phone number: establishes emission limits and other [FRL–7465–9] (215) 814–3381. requirements for the purpose of SUPPLEMENTARY INFORMATION: For reducing toxic air emissions from small Virginia: Final Authorization of State additional information, please see the MWC units throughout the State. New Hazardous Waste Management immediate final rule published in the York submitted its plan to fulfill the Program Revision ‘‘Rules and Regulations’’ section of this requirements of sections 111(d) and 129 Federal Register. of the Clean Air Act. In the ‘‘Rules and AGENCY: Environmental Protection Regulations’’ section of this Federal Agency (EPA). Dated: March 5, 2003. Register, EPA is approving the State’s ACTION: Proposed rule. Thomas Voltaggio, SIP submittal, as a direct final rule Acting Regional Administrator, Region III. without prior proposal because the SUMMARY: Virginia has applied to EPA [FR Doc. 03–6110 Filed 3–12–03; 8:45 am] Agency views this as a noncontroversial for final authorization of the changes to BILLING CODE 6560–50–P submittal and anticipates no adverse its hazardous waste program under the comments. A detailed rationale for the Resource Conservation and Recovery approval is set forth in the direct final Act (RCRA). EPA proposes to grant final FEDERAL COMMUNICATIONS rule. If EPA receives no adverse authorization to Virginia. In the ‘‘Rules COMMISSION comments, EPA will not take further and Regulations’’ section of this Federal action on this proposed rule. Register, EPA is authorizing the changes 47 CFR Part 15 If EPA receives adverse comments, by an immediate final rule. EPA did not EPA will withdraw the direct final rule make a proposal prior to the immediate [ET Docket No. 00–258 and IB Docket No. and it will not take effect. EPA will final rule because we believe this action 99–81; FCC 03–16] address all public comments in a is not controversial and do not expect Advanced Wireless Service subsequent final rule based on this comments that oppose it. We have proposed rule. The EPA will not explained the reasons for this AGENCY: Federal Communications institute a second comment period on authorization in the preamble to the Commission. this action. Any parties interested in immediate final rule. Unless we receive ACTION: Proposed rule. commenting on this action should do so written comments which oppose this at this time. authorization during the comment SUMMARY: This document seeks DATES: Written comments must be period, the immediate final rule will comment on how to use the reallocated received on or before April 14, 2003. become effective on the date it Mobile Satellite Service (MSS) spectrum

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as well as other bands previously applicable docket or rulemaking effective use of this remaining spectrum. proposed for Advanced Wireless Service number. Parties may also submit an For example, parties filing comments in (AWS) use, the relocation of the electronic comment by Internet e-mail. response to any of the issues in the Multipoint Distribution Service (MDS), To get filing instructions for e-mail Third Notice should take into account and additional flexibility for the comments, commenters should send an how the modification of our rules to Unlicensed Personal Communications e-mail to [email protected], and should allow MSS licensees to deploy ATC (see Service (UPCS) band spectrum, in order include the following words in the body Flexibility for Delivery of to promote more efficient spectrum use of the message, ‘‘get form

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has prepared this Initial Regulatory generally defines the term ‘‘small licensees of AWS-like bands in other Flexibility Analysis (IRFA) of the entity’’ as having the same meaning as countries include incumbent possible significant economic impact on the terms ‘‘small business,’’ ‘‘small commercial radiotelephone operators, small entities by the policies and rules organization,’’ and ‘‘small governmental we believe that there is a high proposed in this Third Notice of jurisdiction.’’ 3 In addition, the term likelihood that the class of AWS Proposed Rulemaking (Third NPRM). ‘‘small business’’ has the same meaning licensees may ultimately consist of one Comment is requested in this IRFA. as the term ‘‘small business concern’’ or more radiotelephone operator. Comments must be identified as under the Small Business Act.4 A Therefore, we examine this category in responses to the IRFA and must be filed ‘‘small business concern’’ is one which: greater depth. The SBA has developed by the deadlines for comments on the (1) Is independently owned and a small business size standard for small Third NPRM as provided in paragraph operated; (2) is not dominant in its field businesses in the category ‘‘Cellular and 77 of the Third NPRM. The Commission of operation; and (3) satisfies any Other Wireless Telecommunications.’’ 11 will send a copy of the Third NPRM, additional criteria established by the Under that SBA category, a business is including this IRFA, to the Chief Small Business Administration (SBA).5 small if it has 1,500 or fewer Counsel for Advocacy of the Small 6. A small organization is generally employees.12 According to the Bureau Business Administration. See 5 U.S.C. ‘‘any not-for-profit enterprise which is of the Census, only 12 firms from a total 603(a). independently owned and operated and of 1238 cellular and other wireless 6 telecommunications firms operating Need for, and Objectives of, the is not dominant in its field.’’ during 1997 had 1,000 or more Proposed Rules Nationwide, as of 1992, there were approximately 275,801 small employees.13 Therefore, even if all 12 of 3. The Third NPRM seeks comments organizations.7 ‘‘Small governmental these firms were cellular telephone on the reallocation of spectrum in the jurisdiction’’ generally means companies, nearly all cellular carriers 1910–1920 MHz band that can be paired ‘‘governments of cities, counties, towns, were small businesses under the SBA’s with spectrum in the 1990–2000 MHz townships, villages, school districts, or definition. In addition, we note that band to support fixed and mobile special districts, with a population of there are 1807 cellular licenses; services, including AWS. It proposes less than 50,000.’’ 8 As of 1992, there however, a cellular licensee may own that additional flexibility be afforded to were approximately 85,006 several licenses. According to the most the UPCS spectrum (that remains in the governmental entities in the United recent Trends in Telephone Service 1910–1930 MHz band) in order to States.9 This number includes 38,978 data, 858 carriers reported that they support a variety of UPCS devices, counties, cities, and towns; of these, were engaged in the provision of either including voice and data devices, and 37,566, or 96%, have populations of cellular service, Personal asks whether additional unlicensed fewer then 50,000.10 The Census Bureau Communications Service (PCS), or devices—such as community wireless estimates that this ratio is Specialized Mobile Radio telephony networks—could also coexist in the approximately accurate for all services, which are placed together in band. The Third NPRM also proposes to governmental entities. Thus, of the that data. We have estimated that 291 of reallocate spectrum at 2155–2165 MHz 85,006 governmental entities, we these are small under the SBA small that was previously identified as 14 estimate that 81,600 (96%) are small business size standard. Accordingly, candidate spectrum for AWS, and seeks entities. based on this data, we estimate that not the most appropriate means to relocate Radiotelephone Operators. The more than 291 radiotelephone operators licensees operating in the 2150–2160/ would be affected by a decision to make 2162 MHz band. Together, these Commission has not developed service rules for AWS spectrum, nor has it additional spectrum available for AWS. proposed actions continue our efforts to Fixed Microwave Services. The Third attempted to categorize potential identify spectrum that is suitable for NPRM proposes to reallocate a 5 licensees for this spectrum. However, AWS, and to allocate our existing in megahertz spectrum block (2160–2165 because many of the comments we such a way as to promote overall MHz) that is licensed to fixed point-to- received in support of our efforts to efficient use. point microwave services and was allocate spectrum for AWS were previously identified for reallocation for Legal Basis submitted by commercial advanced services in the Commission’s radiotelephone operators and because 4. The proposed action is authorized Emerging Technologies proceeding.15 under sections 1, 4(i), 7(a), 301, 302(a), 3 5 U.S.C. 601(6). 303(f), 303(g), 303(r), 307, 308, 309(j), 11 13 CFR 121.201, North American Industry 4 5 U.S.C. 601(3) (incorporating by reference the 316, and 332 of the Communications Classification System (NAICS) code 513322. definition of ‘‘small-business concern’’ in the Small 12 Act of 1934, as amended, 47 U.S.C. Business Act, 15 U.S.C. 632). Pursuant to 5 U.S.C. Id. 13 sections 151, 154(i), 157(a), 301, 302(a), 601(3), the statutory definition of a small business U.S. Department of Commerce, U.S. Census 303(f), 303(g), 303(r), 307, 308, 309(j), applies ‘‘unless an agency, after consultation with Bureau, 1997 Economic Census, Information— Subject Series, Establishment and Firm Size, Table 316, and 332. the Office of Advocacy of the Small Business Administration and after opportunity for public 5—Employment Size of Firms Subject to Federal Description and Estimate of the Number comment, establishes one or more definitions of Income Tax at 64, NAICS code 513322 (October such term which are appropriate to the activities of 2000). of Small Entities to Which the Rules 14 the agency and publishes such definition(s) in the See Trends in Telephone Service, Industry Will Apply Federal Register.’’ Analysis and Technology Division, Wireline 5 15 U.S.C. 632. Communications Bureau, Table 5.3, page 5–5 (May 5. The RFA directs agencies to 2002). 6 5 U.S.C. 601(4). provide a description of, and, where 15 Redevelopment of Spectrum to Encourage the 7 Department of Commerce, U.S. Bureau of the feasible, an estimate of, the number of Establishment of Services Using New and Census, 1992 Economic Census, Table 6 (special Innovative Technologies, ET Docket No. 92–9, First small entities that may be affected by tabulation of data under contract to Office of 2 Report and Order and Third Notice of Proposed the rules adopted herein. The RFA Advocacy of the U.S. Small Business Rule Making, 7 FCC Rcd 6886 (1992), 57 FR 49020, Administration). October 10, 1992 and 57 FR 48776, October 28, Regulatory Enforcement Fairness Act of 1996 8 5 U.S.C. 601(5). 1992; Second Report and Order, 8 FCC Rcd 6495 (SBREFA), Pub. L. 104–121, title II, 110 Stat. 857 9 U.S. Dept. of Commerce, Bureau of the Census, (1993), 58 FR 49220, September 22, 1993; Third (1996). ‘‘1992 Census of Governments.’’ Report and Order and Memorandum Opinion and 2 5 U.S.C. 604(a)(3). 10 Id. Continued

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Microwave services include common frequencies in the Emerging Technology business. At this time, we estimate that carrier,16 private-operational fixed,17 bands affected by this proceeding. In of the 61 small business MDS auction and broadcast auxiliary radio services.18 addition, the band contains winners, 48 remain small business At present, there are approximately approximately 13 licenses in the paging licensees. In addition to the 48 small 22,015 common carrier fixed licensees and radiotelephone service and 40 Local businesses that hold BTA and 61,670 private operational-fixed Television Transmission Service authorizations, there are approximately licensees and broadcast auxiliary radio licenses. Thus, assuming that these 392 incumbent MDS licensees that are licensees in the microwave services. entities also qualify as small businesses, considered small entities.27 After The Commission has not yet defined a as many as 943 small business licensees adding the number of small business small business with respect to could be affected by the rules we adopt. auction licensees to the number of microwave services. For purposes of We note that these entities have been incumbent licensees not already this FRFA, we will use the SBA’s subject to relocation under rules counted, we find that there are currently definition applicable to wireless and originally adopted in the Commission’s approximately 440 MDS licensees that other telecommunications companies— Emerging Technologies proceeding. The are defined as small businesses under i.e., an entity with no more than 1,500 Third NPRM anticipates that these either the SBA or the Commission’s persons.19 According to Census Bureau general relocation rules will continue to rules. Because the Commission’s action data for 1997, there were 977 firms in apply to FS microwave licensees and only affects MDS operations in the this category, total, that operated for the does not propose to modify the class of 2155–2160 MHz band (and 2155–2162 entire year.20 Of this total, 965 firms had licensees that are subject to these MHz band in some cases), the actual employment of 999 or fewer employees, relocation provisions. number of MDS providers who will be and an additional 12 firms had Multipoint Distribution Service affected by the proposed reallocation employment of 1,000 employees or (MDS). The Third NPRM proposes to will only represent a small fraction of more.21 Thus, under this size standard, reallocate spectrum for MDS licensees those 440 small business licensees. the great majority of firms can be that currently operate in the 2155–2160 Unlicensed Personal Communications considered small. MHz band (and the 2155–2162 MHz Service (UPCS). As its name indicates, 7. We note that the number of firms band in some cases). This service has UPCS is not a licensed service. UPCS does not necessarily track the number of historically provided primarily point-to- consists of intentional radiators licensees. We estimate that all of the multipoint, one-way video services to operating in the frequency bands 1910– 22 Fixed Microwave licensees (excluding subscribers. The Commission recently 1930 MHz and 2390–2400 MHz, that broadcast auxiliary licensees) would amended its rules to allow MDS provide a wide array of mobile and qualify as small entities under the SBA licensees in the 2500–2690 MHz band to ancillary fixed communication services definition. Of these licenses, provide a wide range of high-speed, to individuals and businesses. The 23 approximately 890 are issued for two-way services to a variety of users. Third NPRM affects UPCS operations in In connection with the 1996 MDS the 1910–1920 MHz band; operations in Order, 8 FCC Rcd 6589 (1993), 58 FR 46547, auction, the Commission defined small those frequencies are limited to October 4, 1993; Memorandum Opinion and Order, businesses as entities that had annual asynchronous (generally data) 9 FCC Rcd 1943 (1994), 59 FR 19642, April 25, average gross revenues for the three 1994; Second Memorandum Opinion and Order, 9 applications. There is no accurate FCC Rcd 7797 (1994), 59 FR 65501, December 20, preceding years not in excess of $40 source for the number of operators in 24 1994, aff’d, Association of Public Safety million. The Commission established the UPCS. The Commission has not Communications Officials-International, Inc. v. this small business definition in the FCC, 76 F.3d 395 (D.C. Cir. 1996) (collectively, developed a definition of small entities context of this particular service and applicable to UPCS equipment ‘‘Emerging Technologies proceeding’’). with the approval of the SBA.25 The 16 47 CFR 101 et seq. (formerly, part 21 of the manufacturers. However, the SBA has Commission’s Rules). MDS auction resulted in 67 successful developed a small business size 17 Persons eligible under parts 80 and 90 of the bidders obtaining licensing standard, Cellular and Other Wireless Commission’s rules can use Private Operational- opportunities for 493 Basic Trading Carriers, which consists of all such Fixed Microwave services. See 47 CFR parts 80 and Areas (BTAs).26 Of the 67 auction 90. Stations in this service are called operational- companies having 1500 or fewer fixed to distinguish them from common carrier and winners, 61 met the definition of a small employees.28 According to Census public fixed stations. Only the licensee may use the Bureau data for 1997, there were 977 operational-fixed station, and only for 22 For purposes of this item, MDS includes single communications related to the licensee’s channel Multipoint Distribution Service (MDS) and firms in this category, total, that 29 commercial, industrial, or safety operations. the Multichannel Multipoint Distribution Service operated for the entire year. Of this 18 Auxiliary Microwave Service is governed by (MMDS). See 66 FR 36177. total, 965 firms had employment of 999 part 74 of title 47 of the Commission’s rules. See 23 Amendment of parts 21 and 74 to Enable or fewer employees, and an additional 47 CFR part 74 et seq. Available to licensees of Multipoint Distribution Service and Instructional 12 firms had employment of 1,000 broadcast stations and to broadcast and cable Television Fixed Service Licensees to Engage in 30 network entities, broadcast auxiliary microwave Fixed Two-Way Transmissions, MM Docket No. 97– employees or more. Thus, under this stations are used for relaying broadcast television 217, Report and Order, 13 FCC Rcd 19112 (1998), signals from the studio to the transmitter, or 63 FR 65087, November 25, 1998, recon., 14 FCC 27 47 U.S.C. 309(j). (Hundreds of stations were between two points such as a main studio and an Rcd 12764 (1999), 64 FR 63727, November 22, 1999, licensed to incumbent MDS licensees prior to auxiliary studio. The service also includes mobile further recon., 15 FCC Rcd 14566 (2000). implementation of Section 309(j) of the TV pickups, which relay signals from a remote 24 47 CFR 21.961 and 1.2110. Communications Act of 1934, 47 U.S.C. 309(j)). For location back to the studio. 25 Amendment of parts 21 and 74 of the these pre-auction licenses, the applicable standard 19 13 CFR 121.201, NAICS code 517212 (formerly Commission’s Rules with Regard to Filing is SBA’s small business size standard for ‘‘other 513322). Procedures in the Multipoint Distribution Service telecommunications’’ (annual receipts of $12.5 20 U.S. Census Bureau, 1997 Economic Census, and in the Instructional Television Fixed Service million or less). See 13 CFR 121.201. Subject Series: Information, ‘‘Employment Size of and Implementation of section 309(j) of the 28 13 CFR 121.201, North American Industry Firms Subject to Federal Income Tax: 1997,’’ Table Communications Act—Competitive Bidding, MM Classification System (NAICS) code 517212. 5, NAICS code 517212 (issued Oct. 2000). Docket No. 94–131, Report and Order, 10 FCC Rcd 29 U.S. Census Bureau, 1997 Economic Census, 21 Id. The census data do not provide a more 9589, 9670 (1995), 60 FR 36524 (July 17, 1995). Subject Series: Information, ‘‘Employment Size of precise estimate of the number of firms that have 26 Basic Trading Areas (BTAs) were designed by Firms Subject to Federal Income Tax: 1997,’’ Table employment of 1,500 or fewer employees; the Rand McNally and are the geographic areas by 5, NAICS code 517212 (issued Oct. 2000). largest category provided is ‘‘Firms with 1,000 which MDS was auctioned and authorized. See id. 30 Id. The census data do not provide a more employees or more.’’ at 9608. precise estimate of the number of firms that have

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size standard, the great majority of firms spectrum we propose to allocate in the applications in the 1915–1920 MHz can be considered small. However, no 2160–2165 MHz band was previously portion of the band if we decide to equipment authorizations have been identified as an Emerging Technology reallocate only the 1910–1915 MHz issued for devices operating in the band; thus, we have previously band segment. We note that we had 1910–1920 MHz band. considered relocation consequences and sought comment on use of the entire established relocation procedures for 1910–1930 MHz band for AWS, and that Description of Projected Reporting, incumbent operators in this band. Small the record reflects that numerous small Recordkeeping, and Other Compliance entities operating in this band have entities may use or manufacture UPCS Requirements known for a decade that they are subject voice equipment on the 1920–1930 MHz 9. The Third NPRM addresses the to relocation and may have taken steps portion of the band. Thus, the Third possible use of frequency bands below (such as deploying more efficient R&O represents a means to provide 3 GHz to support the introduction of systems in different spectrum in lieu of additional opportunities both to small new AWS, but does not propose service upgrading existing equipment) that entities that provide AWS while rules. Thus, the item contains no new could minimize the consequences of providing minimal disruption to small reporting, recordkeeping, or other relocation vis-a`-vis licensees in another entities that are UPCS users and compliance requirements. spectrum band that had not heretofore manufacturers (and possibly providing been identified as a candidate for Steps Taken to Minimize Significant additional benefits, if the proposal to reallocation. Thus, the existing expand permitted UPCS use of the Economic Impact on Small Entities, and relocation procedures should serve to Significant Alternatives Considered 1915–1920 MHz band is adopted). For ease the relocation of small entity this reason we conclude that our action 10. The RFA requires an agency to incumbents in the 2160–2165 MHz is preferable to other alternatives, such describe any significant alternatives that band, and make reallocation of this as retaining the existing UPCS it has considered in developing its band a preferable alternative to the allocation in its entirety. approach, which may include the reallocation of other bands where we following four alternatives (among would have to establish new relocation Rules That May Duplicate, Overlap or others): ‘‘(1) The establishment of rules. Conflict With the Proposed Rules differing compliance or reporting 13. The Commission has already 15. None. requirements or timetables that take into received extensive comments in this List of Subjects in 47 CFR Part 15 account the resources available to small proceeding on issues related to the entities; (2) the clarification, possible reallocation of the 2150–2160 Communications equipment. consolidation, or simplification of MHz (2.1 GHz) spectrum for advanced Federal Communications Commission. compliance and reporting requirements wireless purposes. Comments filed by Marlene H. Dortch, the multipoint distribution/instructional under the rule for such small entities; Secretary. (3) the use of performance rather than television fixed services industry and design standards; and (4) an exemption several equipment manufacturers argue Proposed Rules from coverage of the rule, or any part that the 2.1 GHz band is necessary for For the reasons discussed in the thereof, for such small entities.’’ 31 the continued roll-out of fixed wireless preamble, the Federal Communications 11. Providing spectrum to support the services across the country. Other Commission proposes to amend 47 CFR introduction of new advanced mobile commenters support the use of 2.1 GHz part 15 as follows: and fixed terrestrial wireless services is for advanced wireless services. In a critical to the continuation of recent decision, the Commission PART 15—RADIO FREQUENCY technological advancement. As an determined that it was necessary to DEVICES initial matter, we believe that the reallocate MDS operations at 2150–2155 1. The authority citation for part 15 provision of additional spectrum that MHz to create a 45 megahertz block of continues to read as follows: can be used to support AWS will contiguous spectrum that can be used to directly benefit small business entities provide advanced services, but did not Authority: 47 U.S.C. 154, 302, 303, 304, by providing new opportunities for the decide how to relocate these operations 307, 336, and 544A. provision of innovative new fixed and or what to do with remaining MDS 2. Section 15.319 is amended by mobile wireless services. operations in the 2155–2160/62 MHz revising the first sentence in paragraph 12. We realize that some entities must band. One option proposed is the (a) to read as follows: be displaced to clear a sufficient reallocation of the remaining MDS quantity of contiguous spectrum to spectrum. By taking this action, we § 15.319 General technical requirements. support new services. We endeavored to would be able to provide opportunities (a) The 2390–2400 MHz band is avoid this effect by identifying associated with the provision of limited to use by asynchronous devices unencumbered spectrum, but spectrum contiguous and/or paired blocks of under the requirements of § 15.321. in the suitable frequency range is spectrum that can be used for fixed and *** heavily used already and a sufficient mobile applications, including AWS. * * * * * 14. The Third NPRM discusses amount of unencumbered spectrum 3. Section 15.321 is amended by reallocation of UPCS spectrum in the simply does not exist. We have also revising the section heading and 1910–1920 MHz band for AWS. Because sought to minimize an adverse impact paragraphs (a) and (b) to read as follows: no equipment is currently certified for by proposing to reallocate frequency this band, we conclude that our § 15.321 Specific requirements for bands for those incumbents, including decision is unlikely to affect any users asynchronous devices operating in the small entities, which might be or equipment manufacturers that are 2390–2400 MHz band. accommodated in other spectrum. The small entities. We also explore options (a) Operation shall be contained for providing increased flexibility of within the 2390–2400 MHz band. The employment of 1,500 or fewer employees; the largest category provided is ‘‘Firms with 1,000 unlicensed use in the remaining UPCS emission bandwidth of any intentional employees or more.’’ spectrum, including modifying our rules radiator operating in these bands shall 31 5 U.S.C. 603(c)(1)–(c)(4). to allow for expanded voice-based be no less than 500 kHz.

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(b) All systems of less than 2.5 MHz 96–45 released on February 25, 2003. information collected; and (d) ways to emission bandwidth shall start The full text of this document is minimize the burden of the collection of searching for an available spectrum available for public inspection during information on the respondents, window within 3 MHz of the band edge regular business hours in the FCC including the use of automated at 2390 or 2400 MHz while systems of Reference Center, Room CY–A257, 445 collection techniques or other forms of more than 2.5 MHz emission bandwidth Twelfth Street, SW., Washington, DC information technology. will first occupy the center half of the 20554. C. Initial Regulatory Flexibility Analysis band. Devices with an emission I. Notice of Proposed Rulemaking bandwidth of less than 1.0 MHz may not 4. As required by the Regulatory occupy the center half of the sub-band 1. In this Notice of Proposed Flexibility Act (RFA), the Commission if other spectrum is available. Rulemaking (NPRM), we seek comment has prepared this Initial Regulatory * * * * * on the Recommended Decision of the Flexibility Analysis (IRFA) of the possible significant economic impact on [FR Doc. 03–6038 Filed 3–12–03; 8:45 am] Federal-State Joint Board on Universal Service (Joint Board) regarding the small entities by the policies and rules BILLING CODE 6712–01–P definition of services supported by proposed in this NPRM. Written public universal service. A copy of the comments are requested on this IRFA. FEDERAL COMMUNICATIONS Recommended Decision can be found at Comments must be identified as COMMISSION 17 FCC Rcd 14095 (Wir. Com. Bur. rel. responses to the IRFA and must be filed Jul. 10, 2002). In its Recommended by the deadlines for comments on the 47 CFR Part 54 Decision, the Joint Board generally NPRM provided. The Commission will recommended that the Commission not send a copy of the NPRM, including this [CC Docket No. 96–45; FCC 03–13] modify the existing list of services IRFA, to the Chief Counsel for Advocacy Federal-State Joint Board on Universal supported by universal service. The of the Small Business Administration. Service Joint Board was unable to reach In addition, the NPRM and IRFA (or agreement, however, on whether equal summaries thereof) will be published in AGENCY: Federal Communications access to interexchange service (equal the Federal Register. Commission. access) satisfies the statutory criteria D. Need for and Objectives of the ACTION: Notice of proposed rule. contained in section 254(c) of the Proposed Rules Communications Act of 1934, as SUMMARY: In this document, the amended (the Act), and should be added 5. Pursuant to section 254(c) of the Commission seeks comment on the to the list of supported services. We Act, the Joint Board on Universal Recommended Decision of the Federal- seek comment regarding the Joint Service may periodically make State Joint Board on Universal Service Board’s recommendations and recommendations to modify the list of (Joint Board) regarding the definition of positions. supported services, in order to take services supported by universal service. account for advances in In its Recommended Decision, the Joint II. Procedural Issues telecommunications and information Board generally recommended that the A. Ex Parte Presentations technologies and services. On December Commission not modify the existing list 21, 2000, the Commission requested the of services supported by universal 2. This is a permit but disclose Joint Board to review the definition of service. The Joint Board was unable to rulemaking proceeding. Ex parte universal service and make reach agreement, however, on whether presentations are permitted, except recommendations regarding whether equal access to interexchange service during the Sunshine Agenda period, as modifications to the definition are (equal access) satisfies the statutory long as they are disclosed as provided warranted. The Joint Board criteria contained in the in the Commission’s rules. subsequently released a public notice Communications Act of 1934, as B. Initial Paperwork Reduction Act seeking comment on the services, if any, amended, and should be added to the Analysis that should be added to or removed list of supported services. The from the list of core services. On July 10, Commission seeks comment regarding 3. This NPRM may modify an 2002, the Joint Board released its the Joint Board’s recommendations and information collection. As part of a recommendations regarding the list of positions. continuing effort to reduce paperwork services supported by universal service. burdens, we invite the general public DATES: Comments are due on or before The NPRM seeks comment on the Joint and the Office of Management and Board’s recommendations. April 14, 2003. Reply comments are due Budget (OMB) to take this opportunity on or before April 28, 2003. to comment on the information 1. Legal Basis ADDRESSES: Federal Communications collections contained in this NPRM, as 6. The legal basis as proposed for this Commission, 445 12th Street, SW., Suite required by the Paperwork Reduction NPRM is contained in §§ 4(i), 4(j), 201– TW–A325, Marlene H. Dortch, Office of Act of 1995, Public Law 104–13. Public 205, 214, 254, and 403 of the the Secretary, Washington, DC, 20554. and agency comments are due at the Communications Act of 1934, as See SUPPLEMENTARY INFORMATION for same time as other comments on this amended. further filing instructions. NPRM; OMB comments are due May 12, FOR FURTHER INFORMATION CONTACT: 2003. Comments should address: (a) 2. Description and Estimate of the Katherine Tofigh, Attorney or Diane Whether the proposed collection of Number of Small Entities to Which the Law Hsu, Deputy Division Chief, information is necessary for the proper Proposed Rules will Apply Wireline Competition Bureau, performance of the functions of the 7. The RFA directs agencies to Telecommunications Access Policy Commission, including whether the provide a description of, and, where Division, (202) 418–7400. information shall have practical utility; feasible, an estimate of the number of SUPPLEMENTARY INFORMATION: This is a (b) the accuracy of the Commission’s small entities that may be affected by summary of the Commission’s Notice of burden estimates; (c) ways to enhance the proposed modifications to the Proposed Rulemaking in CC Docket No. the quality, utility, and clarity of the definition of universal services. To

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estimate the number of small entities resellers. It seems certain that some of business concerns under SBA’s that could be affected by these proposed those 6,239 telephone service firms may definition. Consequently, we estimate modifications to the Commission’s not qualify as small entities because that there are fewer than 181 small rules, we first consider the statutory they are not ‘‘independently owned and entity IXCs that may be affected by the definition of ‘‘small entity’’ under the operated.’’ For example, a PCS provider proposals in the NPRM. RFA. The RFA defines the term ‘‘small that is affiliated with an interexchange 13. Operator Service Providers, entity’’ as having the same meaning as carrier having more than 1,500 Prepaid Calling Card Providers, Satellite the terms ‘‘small business,’’ ‘‘small employees would not meet the Service Carriers, Toll Resellers, Other organization,’’ and ‘‘small business definition of a small business. It is Toll Carriers, and Payphone Providers. concern’’ under the Small Business Act. reasonable to conclude, therefore, that Neither the Commission nor SBA has A small business concern is one that: (1) 6,239 or fewer telephone service firms developed a definition particular to Is independently owned and operated; are small entity telephone service firms operator service providers (OSPs), (2) is not dominant in its field of that may be affected by the decisions prepaid calling card providers, satellite operation; and (3) satisfies any proposed in this NPRM. service carriers, toll resellers, other toll additional criteria established by the 11. Local Exchange Carriers and carriers, or payphone providers. The Small Business Administration (SBA). Competitive Access Providers. Neither closest applicable definition for these 8. We have included small incumbent the Commission nor the SBA has carrier-types under SBA rules is for LECs in this present RFA analysis. As developed a definition for small telephone communications companies noted above, a ‘‘small business’’ under providers of local exchange services. other than radiotelephone (wireless) the RFA is one that, inter alia, meets the The closest applicable definition under companies. The most reliable source of pertinent small business size standard the SBA rules is for wired information regarding the number of (e.g., a telephone communications telecommunications carriers. This these carriers nationwide of which we business having 1,500 or fewer provides that a wired are aware appears to be the data that we employees), and ‘‘is not dominant in its telecommunications carrier is a small collect annually on the Form 499–A. field of operation.’’ The SBA’s Office of entity if it employs no more than 1,500 According to our most recent data, there Advocacy contends that, for RFA employees. According to the most are 20 OSPs, 31 prepaid calling card purposes, small incumbent LECs are not recent Commission data there are 1,619 providers, 25 satellite service carriers, dominant in their field of operation local services providers with 1,500 or 538 toll resellers, 37 other toll carriers, because any such dominance is not fewer employees. Because it seems and 933 payphone providers that have ‘‘national’’ in scope. We have therefore certain that some of these carriers are 1,500 of fewer employees. Although it included small incumbent LECs in this not independently owned and operated, seems certain that some of these carriers RFA analysis, although we emphasize we are unable at this time to estimate are not independently owned and that this RFA action has no effect on with greater precision the number of operated, we are unable at this time to Commission analyses and these carriers that would qualify as estimate with greater precision the determinations in other, non-RFA small business concerns under SBA’s number of these carriers that would contexts. definition. Of the 1,619 local service qualify as small business concerns 9. The most reliable source of providers, 1,024 are incumbent local under SBA’s definition. Consequently, information regarding the total numbers exchange carriers, 411 are Competitive we estimate that there are fewer than 20 of common carrier and related providers Access Providers (CAPs) and OSPs, 31 prepaid calling card providers, nationwide, including the numbers of Competitive Local Exchange Carriers 25 satellite service carriers, 538 toll commercial wireless entities, appears to (CLECs), 131 are resellers and 53 are resellers, 37 other toll carriers, and 933 be data the Commission publishes other local exchange carriers. payphone providers may be affected by annually in its Trends in Telephone Consequently, we estimate that fewer the decisions and rules adopted in this Service report. These carriers include, than 1,619 providers of local exchange NPRM. inter alia, incumbent local exchange service are small entities or small 14. Cellular and Wireless Telephony. carriers, competitive local exchange incumbent local exchange carriers that Neither the Commission nor the SBA carriers, competitive access providers, may be affected. has developed a definition of small interexchange carriers, other wireline 12. Interexchange Carriers. Neither entities specifically for wireless carriers and service providers (including the Commission nor the SBA has telephony. The closest definition is the shared-tenant service providers and developed a definition of small entities SBA definition for cellular and other private carriers), operator service specifically applicable to providers of wireless telecommunications. Under providers, pay telephone operators, interexchange services (IXCs). The this definition, a cellular licensee is a providers of telephone toll service, closest applicable definition under the small entity if it employs no more than wireless carriers and services providers, SBA rules is for wired 1,500 employees. According to the most and resellers. telecommunications carriers. This recent Commission data, 858 providers 10. Total Number of Telephone provides that a wired classified themselves as providers of Companies Affected. The United States telecommunications carrier is a small wireless telephony, including cellular Bureau of the Census (the ‘‘Census entity if it employs no more than 1,500 telecommunications, Personal Bureau’’) reports that, at the end of employees. According to the most Communications Service, and 1997, there were 6,239 firms engaged in recent Commission data regarding the Specialized Mobile Radio (SMR) providing telephone services, as defined number of these carriers nationwide of Telephony Carriers. 291 providers therein. This number contains a variety which we are aware appears, there are report having 1,500 or fewer employees. of different categories of carriers, 181 IXCs with 1,500 or fewer We do not have data specifying the including local exchange carriers, employees. Because it seems certain that number of these carriers that are not interexchange carriers, competitive some of these carriers are not independently owned and operated, and access providers, cellular carriers, independently owned and operated, we thus are unable at this time to estimate mobile service carriers, operator service are unable at this time to estimate with with greater precision the number of providers, pay telephone operators, PCS greater precision the number of these cellular service carriers that would providers, covered SMR providers, and carriers that would qualify as small qualify as small business concerns

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under the SBA’s definition. reporting possible additions to the list of carriers that are ‘‘small business Consequently, we estimate that there are supported services. concerns’’ under the Small Business fewer than 291 wireless telephony 18. In addition, ETCs may only use Act. carriers that may be affected. support ‘‘for the provision, 15. Other Wireless Services. Neither maintenance, and upgrading of facilities 5. Federal Rules that May Duplicate, the Commission nor the SBA has and services’’ for supported services. Overlap, or Conflict with the Proposed developed a definition of small entities Pursuant to this rule, state regulatory Rules specifically applicable to wireless commissions provide the Commission 22. None. services other than wireless telephony. with annual certifications indicating E. Comment Filing Procedures The closest applicable definition under that ETCs in their states receiving the SBA rules is again that of cellular federal universal service support will 23. We invite comment on the issues and other wireless telecommunications, use the support only for its intended and questions set forth in the Notice of under which a service provider is a purposes. Carriers not subject to the Proposed Rulemaking and Initial small entity if it employs no more than jurisdiction of the state must submit a Regulatory Flexibility Analysis 1,500 employees. According to the most sworn affidavit to the Commission contained herein. Pursuant to applicable recent Commission data, 884 providers stating that they will use the support procedures set forth in §§ 1.415 and with 1,500 of fewer employees classified only for its intended purposes. Entities, 1.419 of the Commission’s rules, themselves as paging services, SMR especially small businesses, are interested parties may file comments on dispatch, wireless data carriers, or other encouraged to quantify the cost of or before April 14, 2003; and reply mobile service providers. We do not compliance for certifying possible comments on or before April 28, 2003. have data specifying the number of additions to the list of supported All filings should refer to CC Docket No. these carriers that are not independently services. 96–45. Comments may be filed using the owned and operated, and thus are Commission’s Electronic Comment 4. Steps Taken to Minimize Significant unable at this time to estimate with Filing System (ECFS) or by filing paper Economic Impact on Small Entities, and greater precision the number of wireless copies. Significant Alternatives Considered service providers that would qualify as 24. Comments filed through ECFS can small business concerns under the 19. The RFA requires an agency to be sent as an electronic file via the SBA’s definition. Consequently, we describe any significant alternatives that Internet to . Generally, only one copy of wireless service providers that may be proposed approach, which may include an electronic submission must be filed. affected. the following four alternatives (among In completing the transmittal screen, others): (1) The establishment of commenters should include their full 3. Description of Projected Reporting, differing compliance or reporting name, Postal Service mailing address, Recordkeeping, and Other Compliance requirements or timetables that take into and the applicable docket number, Requirements account the resources available to small which in this instance is CC Docket No. 16. Should the Commission decide to entities; (2) the clarification, 96–45. Parties may also submit an revise the definition of universal consolidation, or simplification of electronic comment by Internet e-mail. service, the associated rule changes compliance or reporting requirements To receive filing instructions for e-mail could modify the reporting and under the rule for small entities; (3) the comments, commenters should send an recordkeeping requirements of some use of performance, rather than design, e-mail to [email protected], and should telecommunications service providers standards; and (4) an exemption from include the following words in the body regulated under the Communications coverage of the rule, or any part thereof, of the message: get form . A sample form and directions 17. Section 254(e) states that only 20. As discussed previously, this will be sent in reply. eligible telecommunications carriers NPRM seeks comment on the Joint 25. Parties who choose to file by (ETCs) designated pursuant to section Board’s recommendations regarding the paper must file an original and four 214(e) shall be eligible to receive definition of universal service. The Joint copies of each filing. If more than one Federal universal service support. In Board determined that the current list of docket or rulemaking number appears in order to be designated an ETC, a carrier core services continue to satisfy the the caption of this proceeding, must throughout its service area ‘‘offer criteria outlined in section 254(c) and commenters must submit two additional the services that are supported by recommended that the Commission copies for each additional docket or Federal universal service support retain the existing services. For most of rulemaking number. Parties who choose mechanisms under section 254(c).’’ the additional services under to file by paper are hereby notified that Carriers generally apply to their state consideration, the Joint Board effective December 18, 2001, the commission for designation as carriers recommended that the Commission not Commission’s contractor, Vistronix, eligible to receive universal service expand the existing definition of Inc., will receive hand-delivered or support, but seek designation from the services that are supported by federal messenger-delivered paper filings for Commission if they are not subject to universal service. The Joint Board, the Commission’s Secretary at a new the jurisdiction of the state commission. however, was unable to reach agreement location in downtown Washington, DC. If the definition of supported services is on whether equal access satisfies the The address is 236 Massachusetts modified, service provides may be statutory criteria contained in section Avenue, NE., Suite 110, Washington, DC required to verify to either the state or 254(c) of the Act. 20002. The filing hours at this location Commission that any services added to 21. Should the definition of universal will be 8 a.m. to 7 p.m. All hand the definition of universal service are service be modified, we seek comment deliveries must be held together with offered throughout their service areas on how to reduce the administrative rubber bands or fasteners. Any and that they advertise the availability burden and cost of compliance for small envelopes must be disposed of before of such services. Entities, especially telecommunications service providers entering the building. This facility is the small businesses, are encouraged to with respect to each of the proposals. only location where hand-delivered or quantify the cost of compliance for We particularly seek comment from messenger-delivered paper filings for

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the Commission’s Secretary will be proceeding (including the docket http://www.fcc.gov/ccb/ accepted. Accordingly, the Commission number, in this case, CC Docket No. 96– universal_service/highcost. will no longer accept these filings at 45), type of pleading (comment or reply III. Ordering Clauses 9300 East Hampton Drive, Capitol comment), date of submission, and the Heights, MD 20743. Other messenger- name of the electronic file on the 30. Accordingly, it is ordered that, delivered documents, including diskette. The label should also include pursuant to the authority contained in documents sent by overnight mail (other the following phrase ‘‘Disk Copy—Not sections 4(i), 4(j), 201–205, 214, 254, than United States Postal Service an Original.’’ Each diskette should and 403 of the Communications Act of (USPS) Express Mail and Priority Mail), contain only one party’s pleading, 1934, as amended, this Notice of must be addressed to 9300 East preferably in a single electronic file. In Proposed Rulemaking is adopted. Hampton Drive, Capitol Heights, MD addition, commenters must send 31. It is further ordered that the 20743. This location will be open 8 a.m. diskette copies to the Commission’s Commission’s Consumer and to 5:30 p.m. The USPS first-class mail, copy contractor, Qualex International, Governmental Affairs Bureau, Reference Express Mail, and Priority Mail should Portals II, 445 12th Street, SW., Room Information Center, shall send a copy of continue to be addressed to the CY–B402, Washington, DC 20554. this Notice of Proposed Rulemaking, Commission’s headquarters at 445 12th 27. Regardless of whether parties including the Initial Regulatory Street, SW., Washington, DC 20554. The choose to file electronically or by paper, Flexibility Analysis, to the Chief USPS mail addressed to the parties should also file one copy of any Counsel for Advocacy of the Small Commission’s headquarters actually documents filed in this docket with the Business Administration. goes to our Capitol Heights facility for Commission’s copy contractor, Qualex List of Subjects in 47 CFR Part 54 International, Inc., Portals II, 445 12th screening prior to delivery at the Reporting and recordkeeping Commission. Street, SW., Room CY–B402, Washington, DC 20554. Comments and requirements, Telecommunications, Telephone. If you are sending this reply comments will be available for It should be ad- Federal Communications Commission. type of document or dressed for delivery public inspection during regular using this delivery business hours in the FCC Reference method. . . to... Marlene H. Dortch, Center, Room CY–A257, 445 12th Street, Secretary. SW., Washington, DC 20554. In Hand-delivered or mes- 236 Massachusetts [FR Doc. 03–6092 Filed 3–12–03; 8:45 am] addition, the full text of this document senger-delivered Avenue, NE., BILLING CODE 6712–01–P paper filings for the Suite 110, Wash- is available for public inspection and Commission’s Sec- ington, DC 20002 copying during regular business hours retary. (8 a.m. to 7 at the FCC Reference Information FEDERAL COMMUNICATIONS p.m.). Center, Portals II, 445 12th Street, SW., COMMISSION Room CY–A257, Washington, DC, Other messenger-deliv- 9300 East Hampton 20554. This document may also be 47 CFR Part 73 ered documents, in- Drive, Capitol purchased from the Commission’s cluding documents Heights, MD [DA 03–600, Docket No. 02–122, RM–10444] sent by overnight 20743 (8 a.m. to duplicating contractor, Qualex mail (other than 5:30 p.m.). International, Portals II, 445 12th Street, Radio Broadcasting Services; Lone United States Postal SW., Room CY–B402, Washington, DC Pine, CA Service Express Mail 20554, telephone (202) 863–2893, and Priority Mail). facsimile (202) 863–2898, or via e-mail AGENCY: Federal Communications [email protected]. Commission. United States Postal 445 12th Street, 28. Comments and reply comments ACTION: Proposed rule, dismissal. Service first-class SW., Washington, must include a short and concise mail, Express Mail, DC 20554 summary of the substantive arguments SUMMARY: This document dismisses a and Priority Mail. raised in the pleading. Comments and pending petition for rulemaking to add reply comments must also comply with an FM allotment in Lone Pine, All filings must be sent to the § 1.49 and all other applicable sections California. The Audio Division had Commission’s Secretary: Marlene H. of the Commission’s rules. We direct all requested comment on a petition filed Dortch, Office of the Secretary, Federal interested parties to include the name of by Virgil Todd, proposing the allotment Communications Commission, 445 12th the filing party and the date of the filing of Channel 249A at Lone Pine, Street, SW., Suite TW–A325, on each page of their comments and California. See 67 FR 41364, June 18, Washington, DC 20554. reply comments. All parties are 2002. The Audio Division required 26. Parties who choose to file by encouraged to utilize a table of contents, petitioner to include, with his paper should also submit their regardless of the length of their comments, verification that the comments on diskette to Sheryl Todd, submission. We also strongly encourage statements contained in the petition are Telecommunications Access Policy parties to track the organization set forth accurate to the best of his knowledge. Division, Wireline Competition Bureau, in the NPRM in order to facilitate our Petitioner did not file comments Federal Communications Commission, internal review process. supporting the requested allotment. 445 12th Street, SW., Room 5–B540, This document dismisses the petition Washington, DC 20554. Such a F. Further Information for failure to demonstrate a continuing submission should be on a 3.5 inch 29. Alternative formats (computer interest in the requested allotment and diskette formatted in an IBM compatible diskette, large print, audio recording, for failure to supply the verification format using Microsoft Word or and Braille) are available to persons required by Section 1.52 of the compatible software. The diskette with disabilities by contacting Brian Commission’s rules. See 47 CFR 1.52. should be accompanied by a cover letter Millin at (202) 418–7426 voice, (202) The document therefore terminates the and should be submitted in ‘‘read only’’ 418–7365 TTY, or [email protected]. This proceeding. mode. The diskette should be clearly NPRM can also be downloaded in ADDRESSES: Federal Communications labeled with the commenter’s name, Microsoft Word and ASCII formats at Commission, Washington, DC 20554.

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FOR FURTHER INFORMATION CONTACT: persons. There would be neither net Commission consideration or court Deborah A. Dupont, Media Bureau (202) gain nor loss in the land area served, review, all ex parte contacts are 418–7072. because the loss and gain area each prohibited in Commission proceedings, SUPPLEMENTARY INFORMATION: This is a covers 260 square kilometers. Both the such as this one, which involve channel synopsis of the Commission’s Report loss area of Channel 273C1 at Dickson allotments. See 47 CFR 1.1204(b) for and Order, MB Docket No. 02–122, and the gain area of Channel 273C1 at rules governing permissible ex parte adopted February 26, 2003, and released Pegram are completely covered by at contacts. March 4, 2003. The full text of this least five other full-time services, and For information regarding proper Commission decision is available for thus, all areas potentially affected by filing procedures for comments, see 47 inspection and copying during normal this proposal would continue to be well- CFR 1.415 and 1.420. served. Neither Dickson nor Pegram is business hours in the FCC Reference List of Subjects in 47 CFR Part 73 Information Center (Room CY–A257), located within an urbanized area. The 445 12th Street, SW., Washington, DC. existing 70 dBu signal for WQZQ-FM at Radio, Radio broadcasting. The complete text of this decision may Dickson covers 100 percent of the For the reasons discussed in the also be purchased from the Clarksville, Tennessee-Kentucky preamble, the Federal Communications Commission’s copy contractor, Qualex Urbanized Area and 25.2 percent of the Commission proposes to amend 47 CFR International, Portals II, 445 12th Street, Nashville-Davidson, Tennessee Part 73 as follows: SW., Room CY–B402, Washington, DC Urbanized Area. The 70 dBu contour of 20554, telephone (202) 863–2893, the proposed Channel 273C1 facility at PART 73—RADIO BROADCAST facsimile (202) 863–2898, or via e-mail Pegram would cover 100 percent of the SERVICES [email protected]. Clarksville, Tennessee-Kentucky 1. The authority citation for Part 73 Urbanized Area and 20.3 percent of the Federal Communications Commission. continues to read as follows: Nashville-Davidson, Tennessee John A. Karousos, Urbanized Area. Under the Authority: 47 U.S.C. 154, 303, 334 and 336. Assistant Chief, Audio Division, Media circumstances described in the petition, § 73.202 [Amended] Bureau. no Tuck analysis will be necessary to 2. Section 73.202(b), the Table of FM [FR Doc. 03–6097 Filed 3–12–03; 8:45 am] evaluate this change of community Allotments under Tennessee, is BILLING CODE 6712–01–P proposal. amended by removing Dickson, Channel DATES: Comments must be filed on or 273C and by adding Pegram, Channel FEDERAL COMMUNICATIONS before April 25, 2003, and reply 273C. COMMISSION comments on or before May 12, 2003. Federal Communications Commission. ADDRESSES: Federal Communications John A. Karousos, 47 CFR Part 73 Commission, Washington, DC 20554. In Assistant Chief, Audio Division, Media [DA 03–583; MB Docket No. 03–51, RM– addition to filing comments with the Bureau. 10555] FCC, interested parties should serve [FR Doc. 03–6096 Filed 3–12–03; 8:45 am] counsel for the petitioner as follows: BILLING CODE 6712–01–P Radio Broadcasting Services; Dickson John F. Garziglia, Mark Blacknell, and Pegram, TN Womble, Carlyle, Sandridge & Rice, PLLC, 1776 K Street, NW., Suite 200, FEDERAL COMMUNICATIONS AGENCY: Federal Communications Washington, DC 20036. Commission. COMMISSION FOR FURTHER INFORMATION CONTACT: ACTION: Proposed rule. Deborah A. Dupont, Media Bureau (202) 47 CFR Part 73 SUMMARY: This document sets forth a 418–7072. [DA 03–584; MB Docket No. 03–52, RM– proposal to amend the FM Table of SUPPLEMENTARY INFORMATION: This is a 10657; MB Docket No. 03–53, RM–10658; Allotments, Section 73.202(b) of the synopsis of the Commission’s Notice of MB Docket No. 03–54, RM–10659] Commission’s rules, 47 CFR 73.202(b). Proposed Rule Making, MB Docket No. Radio Broadcasting Services; Dalhart, The Audio Division requests comment 03–51; adopted February 26, 2003 and Kermit, and Leakey, TX on a petition filed by Montgomery released March 4, 2003. The full text of Broadcasting Company pursuant to this Commission decision is available AGENCY: Federal Communications section 1.420(i) of the Commission’s for inspection and copying during Commission. normal business hours in the FCC rules, 47 CFR 1.420(i). Petitioner ACTION: Proposed rule. proposes to change the community of Reference Information Center (Room license for Station WQZQ-FM from CY–A257), 445 12th Street, SW., SUMMARY: This document proposes three Dickson to Pegram, Tennessee, and to Washington, DC. The complete text of new allotments in Dalhart, Kermit, and change the FM Table of Allotments by this decision may also be purchased Leakey, Texas. The Audio Division deleting Channel 273C1 at Dickson, from the Commission’s copy contractor, requests comment on a petition filed by Tennessee, and by adding Channel Qualex International, Portals II, 445 Linda Crawford proposing the allotment 273C1 at Pegram, Tennessee, as the 12th Street, SW., Room CY-B402, of Channel 261C at Dalhart, Texas, as community’s first local aural broadcast Washington, DC 20554, telephone the community’s second FM service. The proposed coordinates for (202)863–2893, facsimile (202) 863– commercial aural transmission service. Channel 273C1 at Pegram, Tennessee, 2898, or via e-mail [email protected]. Channel 261C can be allotted to Dalhart are 36–17–50 NL and 87–19–31 WL. The Provisions of the Regulatory in compliance with the Commission’s The allotment will require a site Flexibility Act of 1980 do not apply to minimum distance separation restriction of 32.9 km (20.5 miles) this proceeding. Members of the public requirements with a site restriction of northwest of Pegram. The change of should note that from the time a Notice 38.6 kilometers (24 miles) northwest to community from Dickson to Pegram of Proposed Rule Making is issued until avoid a short-spacing to the license site would result in a net loss of 13,341 the matter is no longer subject to of Station KOMX, Channel 262C2,

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Pampa, Texas. The reference The Audio Division requests of Proposed Rule Making is issued until coordinates for Channel 261C at Dalhart comments on a petition filed by Al Boyd the matter is no longer subject to are 36–14–36 North Latitude and 102– proposing the allotment of Channel Commission consideration or court 52–36 West Longitude. See 229A at Kermit, Texas, as the review, all ex parte contacts are SUPPLEMENTARY INFORMATION, infra. community’s second FM commercial prohibited in Commission proceedings, DATES: Comments must be filed on or aural transmission service. Channel such as this one, which involve channel before April 25, 2003, and reply 229A can be allotted to Kermit in allotments. See 47 CFR 1.1204(b) for comments on or before May 12, 2003. compliance with the Commission’s rules governing permissible ex parte ADDRESSES: Federal Communications minimum distance separation contact. Commission, 445 Twelfth Street, SW., requirements at city reference For information regarding proper Washington, DC 20554. In addition to coordinates. The reference coordinates filing procedures for comments, see 47 filing comments with the FCC, for Channel 229A at Kermit are 31–51– CFR 1.415 and 1.420. interested parties should serve the 27 North Latitude and 103–05–32 West petitioner, his counsel, or consultant, as Longitude. Since Kermit is located List of Subjects in 47 CFR Part 73 follows: Linda Crawford, 3500 Maple within 320 kilometers (199 miles) of the Radio, Radio broadcasting. Avenue #1320, Dallas, TX 75219; Al U.S.-Mexican border, concurrence of the Boyd, 3607 Thomason, Midland, Texas Mexican government has been For the reasons discussed in the 79703; and Katherine Pyeatt, 6655 requested. preamble, the Federal Communications Aintree Circle, Dallas, Texas 75214. The Audio Division requests Commission proposes to amend 47 CFR FOR FURTHER INFORMATION CONTACT: comments on a petition filed by Part 73 as follows: Rolanda F. Smith, Media Bureau, (202) Katherine Pyeatt proposing the 418–2180. allotment of Channel 257A at Leakey, PART 73—RADIO BROADCAST SUPPLEMENTARY INFORMATION: This is a Texas, as the community’s fifth local SERVICES synopsis of the Commission’s Notice of aural transmission service. Channel Proposed Rule Making, MB Docket Nos. 257A can be allotted to Leakey in 1. The authority citation for part 73 03–52, 03–53, 03–54, adopted February compliance with the Commission’s continues to read as follows: 26, 2003, and released March 4, 2003. minimum distance separation Authority: 47 U.S.C. 154, 303, 334 and 336. The full text of this Commission requirements with a site restriction 11.4 decision is available for inspection and kilometers (7.1 miles) west of the § 73.202 [Amended] copying during regular business hours community. The reference coordinates 2. Section 73.202(b), the Table of FM at the FCC’s Reference Information for Channel 257A at Leakey are 29–44– Allotments under Texas, is amended by Center, Portals II, 445 Twelfth Street, 41 North Latitude and 99–52–40 West adding Channel 261C at Dalhart; by SW., Room CY–A257, Washington, DC Longitude. Since Leakey is located adding Channel 229A at Kermit; by 20554. The complete text of this within 320 kilometers (199 miles) of the adding Channel 257A at Leakey. decision may also be purchased from U.S.-Mexican border, concurrence of the the Commission’s duplicating Mexican government has been Federal Communications Commission. contractor, Qualex International, Portals requested. John A. Karousos, II, 445 12th Street, SW., Room CY–B402, Provisions of the Regulatory Assistant Chief, Audio Division, Media Washington, DC, 20554, telephone 202– Flexibility Act of 1980 do not apply to Bureau. 863–2893, facsimile 202–863–2898, or this proceeding. Members of the public [FR Doc. 03–6093 Filed 3–12–03; 8:45 am] via e-mail [email protected]. should note that from the time a Notice BILLING CODE 6712–01–P

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Notices Federal Register Vol. 68, No. 49

Thursday, March 13, 2003

This section of the FEDERAL REGISTER Small businesses may request handlers and producers to submit contains documents other than rules or information on this notice by contacting certain information. Much of this proposed rules that are applicable to the Jay Guerber, Regulatory Fairness information is compiled in aggregate public. Notices of hearings and investigations, Representative, Marketing Order and provided to the industry to assist in committee meetings, agency decisions and Administration Branch, Fruit and marketing decisions. rulings, delegations of authority, filing of petitions and applications and agency Vegetable Programs, AMS, USDA, 1400 The committee has developed forms statements of organization and functions are Independence Avenue SW., Stop 0237, as a means for persons to file required examples of documents appearing in this Washington, DC 20250–0237; telephone information with the committee relating section. (202) 720–2491, Fax: (202) 720–8938, or to olive supplies, shipments, E-mail: [email protected]. dispositions, and other information SUPPLEMENTARY INFORMATION: necessary to effectively carry out the DEPARTMENT OF AGRICULTURE Title: Olives Grown in California, purpose of the Act and the order. Marketing Order 932. California olives are shipped year-round Agricultural Marketing Service OMB Number: 0581–0142. and these forms are used accordingly. A [Doc. No. FV03–932–2 NC] Expiration Date of Approval: USDA form is used to allow growers to September 30, 2003. vote on amendments to or continuance Notice of Request for Extension of a Type of Request: Extension of a of the order. Currently Approved Information currently approved information Formal rulemaking amendments to Collection collection. the order must be approved in referenda Abstract: Marketing order programs conducted by the Secretary. Also, the AGENCY: Agricultural Marketing Service, provide an opportunity for producers of Secretary may conduct a continuance USDA. fresh fruits, vegetables, and specialty referendum to determine industry ACTION: Notice and request for crops, in a specified production area, to support for continuation of the order. comments. work together to solve marketing Handlers are asked to sign an agreement problems that cannot be solved to indicate their willingness to abide by SUMMARY: In accordance with the the provisions of the order whenever the Paperwork Reduction Act of 1995 (44 individually. Order regulations help order is amended. These forms are U.S.C. Chapter 35), this notice ensure adequate supplies of good included in this request. announces the Agricultural Marketing quality product and adequate returns to All the forms under this program Service’s (AMS) intention to request an producers. Under the Agricultural require the minimum information extension for a currently approved Marketing Agreement Act of 1937 (Act), necessary to effectively carry out the information collection for Olives Grown as amended (7 U.S.C. 601–674), requirements of the order, and their use in California, Marketing Order 932. marketing order programs are established if favored by producers in is necessary to fulfill the intent of the DATES: Comments on this notice must be referenda. The handling of the Act as expressed in the order. received by May 12, 2003, to be assured commodity is regulated. The Secretary The information collected would be of consideration. of Agriculture is authorized to oversee used only by authorized representatives ADDRESSES: Interested persons are order operations and issue regulations of the USDA, including AMS, Fruit and invited to submit written comments recommended by a committee of Vegetable Programs’ regional and concerning this notice. Comments must representatives from each commodity headquarter’s staff, and authorized be sent to the Docket Clerk, Marketing industry. employees of the committee. Authorized Order Administration Branch, Fruit and The information collection committee employees and the industry Vegetable Programs, AMS, USDA, 1400 requirements in this request are are the primary users of the information Independence Avenue SW., Stop 0237, essential to carry out the intent of the and AMS is the secondary user. Washington, DC 20250–0237; Fax: (202) Act, to provide the respondents the type Estimate of Burden: Public reporting 720–8938, or E-mail: of service they request, and to burden for this collection of information [email protected]. All administer the California olive is estimated to average .28 hour per comments should reference the docket marketing order program, which has response. number and the date and page number been operating since 1965. Respondents: California olive of this issue of the Federal Register and The California olive marketing order handlers and growers. will be made available for public authorizes the issuance of quality, size, Estimated Number of Respondents: inspection in the Office of the Docket and inspection requirements. The order 691. Clerk during regular business hours, or also has authority for research and Estimated Number of Responses per can be viewed at: http:/ development projects, including paid Respondent: 15. www.ams.usda.gov/fv/moab.html. advertising. Pursuant to section 8e of Estimated Total Annual Burden on FOR FURTHER INFORMATION CONTACT: the Act, import grade and size Respondents: 2947 hours. Caroline Thorpe, Marketing Specialist, requirements are implemented on olives The information collection burden Marketing Order Administration imported into the United States. would affect both California olive Branch, Fruit and Vegetable Programs, The order and its rules and growers and handlers. The majority of AMS, USDA, 1400 Independence regulations authorize the California the collection burden consists of Weight Avenue SW., Stop 0237, Washington, Olive Committee (committee), the and Grade Reports totaling an estimated DC 20250–0237; Telephone: (202) 720– agency responsible for local 2,250 burden hours. These reports are 2491; Fax: (202) 720–8938. administration of the order, to require filed by handlers, who like growers,

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benefit from improved returns due to information from Food Stamp Program implementing a simplified eligibility more orderly market conditions. The (FSP) participants that reside in one of model; and three states (Arizona, Maine rest of this information collection six demonstration sites. and Michigan) are implementing an consists of twenty-four forms that add a DATES: Written comments must be application assistance model. USDA is total of 697 estimated burden hours. received by May 19, 2003 to be assured operating these pilot projects to explore Comments are invited on: (1) Whether of consideration. which demonstration models lead to the proposed collection of the ADDRESSES: Requests for additional increased participation among elderly information is necessary for the proper information regarding this notice should individuals in the Food Stamp Program performance of the functions of the be directed to Elizabeth Dagata, Rural and why. agency, including whether the Working with ERS, a contractor will Economy Branch, Food and Rural information will have practical utility; be evaluating the six demonstration Economics Division, Economic Research (2) the accuracy of the agency’s estimate models. Participation data obtained Service, U.S. Department of Agriculture, of the burden of the proposed collection through administrative case records will 1800 M St. NW., Washington, DC of information, including the validity of be used to estimate the impact of the 20036–5831. Submit electronic the methodology and assumptions used; demonstrations on the number of comments to [email protected]. (3) ways to enhance the quality, utility elderly participants in the Food Stamp and clarity of the information to be SUPPLEMENTARY INFORMATION: Program. To identify reasons why collected; and (4) ways to minimize the Title: Evaluation of Three Models elderly individuals may be more likely burden of the collection of information Designed to Increase Participation of to participate under the demonstrations, on those who are to respond, including Eligible Elderly in the Food Stamp the contractor will contact elderly Food through the use of appropriate Program. Stamp Program participants directly. OMB Number: Not yet assigned. automated, electronic, mechanical, or In the two states that are Expiration Date: Two years from date other technological collection implementing the commodities of issuance. techniques or other forms of information alternative benefit demonstration model Type of Request: Approval to collect technology. (Connecticut and North Carolina), a information from elderly individuals Comments should reference OMB No. sample of elderly food stamp who receive food stamps and who 0581–0142 and California Olive participants will be surveyed. The reside in one of the Elderly Nutrition Marketing Order No. 932, and be sent to survey will query respondents as to Demonstration pilot sites. Docket Clerk, Fruit and Vegetable whether or not they chose to participate Abstract: USDA’s Economic Research Programs, AMS, USDA, 1400 in the commodity alternative benefit Service (ERS) has the responsibility to Independence Avenue, SW., Stop 0237, demonstration, the reason for that provide social and economic Washington, DC 20250–0237; Fax: (202) choice, and, if they are receiving the intelligence on consumer, food 720–8938; or E-mail: commodity alternative benefit, what marketing, and rural issues, including [email protected]. All they like and dislike about it. A food security status of the poor; comments received will be available for different sample of respondents will be domestic food assistance programs; low- public inspection during regular identified every quarter, and interviews income assistance programs; economic business hours at the same address and will occur between three and seven food consumption determinations and will become a matter of public record. quarters. A small sub-sample of All responses to this notice will be trends; consumer demand for food respondents will be contacted a second summarized and included in the request quality, safety, and nutrition; food time to acquire more detailed for OMB approval. All comments will market competition and coordination; information about their experience with also become a matter of public record. and food safety regulation. In carrying the demonstration. out this overall mission, ERS seeks In addition to the survey conducted in Dated: March 7, 2003. approval of information gathering the two commodities demonstration A. J. Yates, activities that will provide key sites, focus groups will be conducted in Administrator, Agricultural Marketing information about the impact of the the one state implementing the Service. Food Stamp Program’s (FSP) Elderly simplified eligibility demonstration [FR Doc. 03–5970 Filed 3–12–03; 8:45 am] Nutrition Demonstration pilots. model (Florida) and in the three states BILLING CODE 3410–02–P Six states (Arizona, Connecticut, implementing the application assistance Florida, Maine, Michigan, and North demonstration model (Arizona, Maine Carolina) are implementing separate and Michigan). There will be two focus DEPARTMENT OF AGRICULTURE Elderly Nutrition Demonstration pilots, groups per state, with each focus group with each State’s pilot based on one of Economic Research Service including 10 elderly FSP participants. three demonstration models: (1) A These focus groups will be used to Notice of Intent To Seek Approval To commodities alternative benefit model, determine what aspects of each Collect Information in which elderly FSP participants can demonstration were beneficial to the elect to receive a package of clients. AGENCY: Economic Research Service, commodities each month in lieu of Affected Public: Elderly FSP USDA. traditional FSP benefits; (2) a simplified participants residing in the SUMMARY: In accordance with the eligibility model, in which the FSP demonstration sites. Paperwork Reduction Act of 1995 (Pub eligibility rules for elderly applicants Estimated Number of Respondents: A L. 104–13) and Office of Management are streamlined; or (3) an application combined total of 167 individuals in the and Budget (OMB) regulations at 5 CFR assistance model, in which two commodities alternative benefit Part 1320 (60 FR 44978, August 29, demonstration staff assist elderly FSP demonstration sites will be interviewed 1995), this notice announces the applicants with completing the food per quarter, and interviews will be Economic Research Service’s (ERS) stamp application. Two states conducted for three to seven quarters. intention to request approval for a new (Connecticut and North Carolina) are The maximum number of interviews information collection from the U.S. implementing a commodities alternative conducted is 1,169 (= 167 respondents population. The study will collect benefit model; one state (Florida) is × 7 quarters). In the remaining four

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demonstration sites, a combined total of DEPARTMENT OF AGRICULTURE 1758(b)(1) and 42 U.S.C. 1766(c)(4)), 80 individuals will participate in focus and sections 3(a)(6) and 4(e)(1)(A) of the groups (10 participants per focus group Food and Nutrition Service Child Nutrition Act of 1966 (42 U.S.C. × 2 focus groups × 4 states). 1772(a)(6) and 1773(e)(1)(A)), the Child Nutrition Programs—Income Department annually issues the Income Number of Responses per Eligibility Guidelines Eligibility Guidelines for free and Respondent: Of the individuals reduced price meals for the National participating in the initial interview, a AGENCY: Food and Nutrition Service, USDA. School Lunch Program (7 CFR Part 210), total of 36 individuals will respond the Commodity School Program (7 CFR ACTION: Notice. twice (once to the initial interview and Part 210), School Breakfast Program (7 once to the follow-up interview). The SUMMARY: This Notice announces the CFR Part 220), Summer Food Service remaining individuals (up to 1,133) will Department’s annual adjustments to the Program (7 CFR Part 225) and Child and respond only once. The 80 individuals Income Eligibility Guidelines to be used Adult Care Food Program (7 CFR Part participating in the focus groups will in determining eligibility for free and 226) and the guidelines for free milk in respond once. reduced price meals or free milk for the the Special Milk Program for Children Estimated Total Responses: Maximum period from July 1, 2003 through June (7 CFR Part 215). These eligibility total number of responses: 1,285 (= 30, 2004. These guidelines are used by guidelines are based on the Federal 1,169 initial commodities interviews + schools, institutions, and facilities income poverty guidelines and are 36 follow up interviews + 80 focus participating in the National School stated by household size. The guidelines group participants). Lunch Program (and Commodity School are used to determine eligibility for free Program), School Breakfast Program, and reduced price meals and free milk Hours per Response: Initial Special Milk Program for Children, in accordance with applicable program commodities alternative benefit Child and Adult Care Food Program and rules. interview: 20 minutes per respondent; Summer Food Service Program. The Definition of Income follow-up commodities alternative annual adjustments are required by In accordance with the Department’s benefit interview: 20 minutes per section 9 of the Richard B. Russell policy as provided in the Food and respondent; focus group: 1 hour 15 National School Lunch Act. The Nutrition Service publication Eligibility minutes per respondent. guidelines are intended to direct Guidance for School Meals Manual, Total Reporting Hours: Maximum benefits to those children most in need ‘‘income,’’ as the term is used in this total reporting hours: 498 hours (= 1,169 and are revised annually to account for Notice, means income before any changes in the Consumer Price Index. initial commodities interviews * 0.33 deductions such as income taxes, Social hours + 36 follow up interviews * 0.33 EFFECTIVE DATE: July 1, 2003. Security taxes, insurance premiums, hours + 80 focus group participants * FOR FURTHER INFORMATION CONTACT: Mr. charitable contributions and bonds. It 1.25 hours). Robert M. Eadie, Chief, Policy and includes the following: (1) Monetary Comments: Comments are invited on Program Development Branch, Child compensation for services, including (a) whether the proposed collection of Nutrition Division, FNS, USDA, wages, salary, commissions or fees; (2) information is necessary for the proper Alexandria, Virginia 22302, or by phone net income from nonfarm self- performance of the functions of the at (703) 305–2620. employment; (3) net income from farm Agency, including whether the SUPPLEMENTARY INFORMATION: This self-employment; (4) Social Security; (5) information has practical utility; (b) the action is not a rule as defined by the dividends or interest on savings or accuracy of the Agency’s estimate of the Regulatory Flexibility Act (5 U.S.C. bonds or income from estates or trusts; burden of the proposed collection of 601–612) and thus is exempt from the (6) net rental income; (7) public information, including the validity of provisions of that Act. assistance or welfare payments; (8) the methodology and assumptions used; In accordance with the Paperwork unemployment compensation; (9) (c) ways to enhance the quality, utility Reduction Act of 1995 (44 U.S.C. 3507), government civilian employee or military retirement, or pensions or and clarity of the information to be no new recordkeeping or reporting veterans payments; (10) private collected; (d) ways to minimize the requirements have been included that pensions or annuities; (11) alimony or burden of the collection of information are subject to approval from the Office of Management and Budget. child support payments; (12) regular on those who are to respond, including This action is exempted from review contributions from persons not living in the use of appropriate automated, by the Office of Management and the household; (13) net royalties; and electronic, mechanical, or other Budget under Executive Order 12866. (14) other cash income. Other cash technological collection techniques or These programs are listed in the income would include cash amounts other forms of information technology. Catalog of Federal Domestic Assistance received or withdrawn from any source Comments should be sent to the address under No. 10.553, No. 10.555, No. including savings, investments, trust stated in the preamble. All responses to 10.556, No. 10.558 and No. 10.559 and accounts and other resources that would this notice will be summarized and are subject to the provisions of be available to pay the price of a child’s included in the request for Office of Executive Order 12372, which requires meal. Management and Budget (OMB) intergovernmental consultation with ‘‘Income,’’ as the term is used in this approval. All comments will also State and local officials. (See 7 CFR Part Notice, does not include any income or become a matter of public record. 3015, Subpart V, and the final rule benefits received under any Federal programs that are excluded from Dated: February 25, 2003. related notice published at 48 FR 29114, June 24, 1983.) consideration as income by any Susan Offut, legislative prohibition. Furthermore, the Administrator, Economic Research Service, Background value of meals or milk to children shall USDA. Pursuant to sections 9(b)(1) and not be considered as income to their [FR Doc. 03–6056 Filed 3–12–03; 8:45 am] 17(c)(4) of the Richard B. Russell households for other benefit programs BILLING CODE 3410–18–P National School Lunch Act (42 U.S.C. in accordance with the prohibitions in

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section 12(e) of the Richard B. Russell The Department’s guidelines for free annual income by 52 and 12, National School Lunch Act and section meals and milk and reduced price meals respectively, and by rounding upward 11(b) of the Child Nutrition Act of 1966 were obtained by multiplying the year to the next whole dollar. The numbers (42 U.S.C. 1760(e) and 1780(b)). 2003 Federal income poverty guidelines reflected in this notice for a family of The Income Eligibility Guidelines by 1.30 and 1.85, respectively, and by four represent an increase of 1.66% over rounding the result upward to the next the July 2002 numbers for a family of The following are the Income whole dollar. Weekly and monthly the same size. Eligibility Guidelines to be effective guidelines were computed by dividing from July 1, 2003 through June 30, 2004. BILLING CODE 3410–30–P

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Authority: (42 U.S.C. 1758(b)(1)). Environmental Quality Incentives possible, however, without augmenting Dated: March 6, 2003. Program (EQIP) as well as other these existing data with additional Roberto Salazar, conservation programs; a portion of the information on land management and technical assistance funds for conservation practice adoption. Administrator. conservation programs has been NASS will collaborate with NRCS in [FR Doc. 03–6079 Filed 3–12–03; 8:45 am] allocated for use in assessing the the acquisition of this additional BILLING CODE 3410–30–C environmental benefits of these information by conducting a survey for conservation practices. The assessment a sub-sample of NRI sample units in the will be used to report progress annually contiguous 48 States. The survey will DEPARTMENT OF AGRICULTURE on Farm Bill implementation to utilize personal interviews to administer National Agricultural Statistics Service Congress and the general public. The a questionnaire that is designed to information collected will also be used obtain from farm operators field-specific Notice of Intent To Seek Approval To to provide OMB with requested data associated with the selected sample Conduct an Information Collection information on the cost effectiveness of units. Specific questions are asked about the EQIP and the Conservation Reserve physical characteristics of the field and AGENCY: National Agricultural Statistics Program. technical aspects of conservation Service, USDA. NRCS has been given the practices associated with the field. ACTION: Notice and request for responsibility of leading a multi-agency Several other questions deal with comments. effort to estimate the environmental production activities before and after benefits of conservation practices. implementation of specific conservation SUMMARY: In accordance with the Benefit measures will initially include practice and with the operator’s Paperwork Reduction Act of 1995 soil quality enhancement, erosion participation in conservation programs. (Public Law 104–13) and Office of reduction, reduction in nutrient and The survey will be conducted in the fall Management and Budget regulations at sediment losses from farm fields, soil of each year beginning in 2003 and 5 CFR part 1320 (60 FR 44978, August carbon sequestration, water use extending through 2008, which is the 29, 1995), this notice announces the efficiency, and reductions in in-stream last year covered by the 2002 Farm Bill. intention of the National Agricultural nutrient and sediment concentrations. Approximately 15,000–20,000 Statistics Service (NASS) to request Investments are being made in interviews will be conducted each year. approval to conduct a new information additional model development to Each year’s data collection will be for a collection, the Conservation Effects address benefits associated with different set of agricultural land units. Assessment Survey. reductions in pesticide losses, air The scope of the study will broaden as DATES: Comments on this notice must be quality, and wildlife habitat. The the models are extended to cover a received by May 19, 2003 to be assured assessment is designed to be national broader suite of conservation practices of consideration. and regional in scope. A sampling and and effects. These data will be collected ADDRESSES: Comments may be mailed to modeling approach has been adopted to under the authority of 7 U.S.C. 2204(a). Ginny McBride, NASS OMB Clearance avoid the high costs associated with Individually identifiable data collected Officer, U.S. Department of Agriculture, expanded reporting by NRCS field staff. under this authority are governed by Room 5336 South Building, 1400 Benefits will be estimated by applying Section 1770 of the Food Security Act Independence Avenue SW., transport models and other physical of 1985, 7 U.S.C. 2276, which requires Washington, DC 20250 or sent process models at sample sites USDA to afford strict confidentiality to electronically to associated with the National Resources non-aggregated data provided by [email protected]. Inventory (NRI) sampling frame. The respondents. NRI is a scientifically-based, Estimate of Burden: Public reporting FOR FURTHER INFORMATION CONTACT: longitudinal panel survey designed to burden for this collection of information Carol House, Acting Associate assess conditions and trends of soil, is estimated to average 60 minutes per Administrator, National Agricultural water, and related resources of the response. Statistics Service, U.S. Department of Nation’s non-federal lands. The NRI is Respondents: Farm operators. Agriculture, (202) 720–4333. conducted for the U.S. Department of Estimated Number of Respondents: SUPPLEMENTARY INFORMATION: Agriculture by NRCS in cooperation 18,000. Title: Conservation Effects with the Iowa State University Estimated Total Annual Burden on Assessment Survey. Statistical Laboratory and provides Respondents: 18,000 hours. Type of Request: Intent to Seek critical information to address agri- Copies of this information collection Approval to Conduct a New Information environmental issues at national, and related instructions can be obtained Collection. regional, and State levels. Data gathered without charge from Ginny McBride, Abstract: The primary objective of the in the NRI are linked to NRCS soil NASS OMB Clearance Officer, at (202) National Agricultural Statistics Service survey and climate databases. These 720–5778. is to prepare and issue State and linked data, along with NRI’s historical Comments: Comments are invited on: national estimates of crop and livestock data for 1982–2001, form the basis for (a) Whether the proposed collection of production, prices, and disposition. The unique modeling applications and information is necessary for the proper goal of this NASS project is to collect analytical capabilities. The NRI performance of the functions of the land management information that will sampling frame will be used for this agency, including whether the assist the Natural Resources project because it captures the diversity information will have practical utility; Conservation Service (NRCS) in of the Nation’s agricultural resource (b) the accuracy of the agency’s estimate assessing environmental benefits base (soils, topography, and climate), of the burden of the proposed collection associated with implementation of which is a critical factor in estimating of information including the validity of various conservation programs and benefits of conservation practices. Also the methodology and assumptions used; installation of associated conservation critical are the historical and linked data (c) ways to enhance the quality, utility, practices. The 2002 Farm Bill that already exist for each NRI sample and clarity of the information to be substantially increased funding for the site. The assessment of benefits is not collected; and (d) ways to minimize the

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burden of the collection of information more than 12 percent of the Agency’s ACTION: Proposed collection; comments on those who are to respond, including quarterly apportioned carryover and requested. through the use of appropriate recovered guarantee authority will be automated, electronic, mechanical, or reserved for loan requests with a SUMMARY: In accordance with the other technological collection guarantee fee of 1 percent, and not more Paperwork Reduction Act of 1995, this techniques or other forms of information than 15 percent of the Agency quarterly notice announces the Rural Housing technology. apportioned carryover and recovered Service’s intention to request clearance All responses to this notice will guarantee authority will be reserved for for a new information collection to become a matter of public record and be guaranteed loan requests with a measure the quality of service provided summarized in the request for OMB guaranteed percentage exceeding 80 by the Rural Housing Service (RHS) approval. percent. Once the above quarterly limits Centralized Servicing Center (CSC). Signed at Washington, DC, February 13, have been reached, all additional loans DATES: Comments on this notice must be 2003. guaranteed with carryover and received by May 12, 2003, to be assured Carol House, recovered funds during the remainder of of consideration. Acting Associate Administrator. that quarter will require a 2 percent FOR FURTHER INFORMATION CONTACT: Bill guarantee fee and not exceed an 80 [FR Doc. 03–6057 Filed 3–12–03; 8:45 am] Scaggs, Section Head, Customer Service percent guarantee limit. As an exception BILLING CODE 3410–20–P Branch, Centralized Servicing Center, to this paragraph and for the purposes 1520 Market Street, Room 3622, St. of this notice, loans developed by the Louis, Missouri 63103, phone: (314) DEPARTMENT OF AGRICULTURE North American Development Bank 206–2096, e-mail: (NADBank) Community Adjustment and [email protected]. Rural Business-Cooperative Service Investment Program (CAIP) will not count against the 15 percent limit. Up SUPPLEMENTARY INFORMATION: Maximum Portion of Guarantee to 50 percent of CAIP funds may be Title: Rural Housing Service— Authority Available for Fiscal Year used for loan requests with a guaranteed Customer Satisfaction Survey. 2003 percentage exceeding 80 percent. Type of Request: New information collection. AGENCY: Rural Business-Cooperative Written requests by the Rural Service, USDA. Development State Office for approval Abstract: The Rural Housing Service of a guaranteed loan with a 1 percent (RHS) provides insured loans to low- ACTION: Notice. guarantee fee or a guaranteed loan and moderate-income applicants located SUMMARY: As set forth in 7 CFR part exceeding 80 percent must be forwarded in rural geographic areas to assist them 4279, subpart B, each fiscal year (FY) to the National Office, Attn: Director, in obtaining decent, sanitary, and safe the Agency shall establish a limit on the Business and Industry Division, for dwellings. RHS currently processes loan maximum portion of guarantee review and consideration prior to originations through approximately 900 authority available for that fiscal year obligation of the guaranteed loan. The Field Offices. The RHS Centralized that may be used to guarantee loans Administrator will provide a written Servicing Center (CSC), located in St. with a guarantee fee of 1 percent or response to the State Office confirming Louis, Missouri, provides support to the guaranteed loans with a guarantee approval or disapproval of the request. Field Offices and is responsible for loan servicing functions with borrowers. The percentage exceeding 80 percent. This EFFECTIVE DATE: March 13, 2003. notice covers only FY 2002 carryover CSC was established to achieve a high and recovered funds. Once FY 2003 FOR FURTHER INFORMATION CONTACT: Fred level of customer service and operating appropriated funds are apportioned, a Kieferle, Processing Branch Chief, efficiency. The CSC has established a second notice will be published for Business and Industry Division, Rural fully integrated call center and is able to those funds. Business-Cooperative Service, USDA, provide borrowers with convenient Allowing the guarantee fee to be Stop 3224, 1400 Independence Avenue, access to their loan account information. reduced to 1 percent or exceeding the 80 SW., Washington, DC 20250–3224, To facilitate the CSC’s mission and in percent guarantee on certain guaranteed telephone (202) 720–7818. an effort to continuously improve its loans that meet the conditions set forth SUPPLEMENTARY INFORMATION: This services, a survey has been developed in 7 CFR 4279.107 and 4279.119 will action has been reviewed and that can measure the quality of service increase the Agency’s ability to focus determined not to be a rule or regulation that the Field Offices and borrowers guarantee assistance on projects which as defined in Executive Order 12866. receive when they contact the CSC. Respondents will only need to report the Agency has found particularly Dated: March 4, 2003. meritorious, such as projects in rural information on a one-time basis. The John Rosso, communities that remain persistently outcome of the Customer Satisfaction poor, experience long-term population Administrator, Rural Business-Cooperative Survey will provide the general Service. decline and job deterioration, are satisfaction level among RHS customers experiencing trauma as a result of [FR Doc. 03–6052 Filed 3–12–03; 8:45 am] throughout the nation highlighting areas natural disaster or are experiencing BILLING CODE 3410–XY–P that need improvement and to provide fundamental structural changes in the a benchmark for future surveys and economic base. improvements in customer service. A Not all of the available Business and DEPARTMENT OF AGRICULTURE follow up survey will be conducted in Industry (B&I) Guaranteed Loan Rural Housing Service 18 months, but may or may not be sent program funding authority for FY 2002 to the same initial respondents. was used; consequently, this and Notice of Request for Collection of Additionally, in accordance with recovered funding authority for Public Information With the Use of a Government Performance and Results approved B&I Guaranteed Loans which Survey Act (GPRA), the survey will enable CSC did not come to fruition are now to measure the results and overall apportioned and available for use. Not AGENCY: Rural Housing Service, USDA. effectiveness of customer services

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provided as well as implement action provisions of the Paperwork Reduction Dated: March 7, 2003. plans and measure improvements. Act (44 U.S.C. chapter 35). Madeleine Clayton, Estimate of Burden: Public reporting Agency: U.S. Census Bureau. Management Analyst, Office of the Chief burden for this collection of information Title: Questionnaire for Building Information Officer. is estimated to average 10 minutes per Permit Officials. [FR Doc. 03–5966 Filed 3–12–03; 8:45 am] response. BILLING CODE 3510–07–P Respondents: Field office personnel, Form Number(s): SOC–QBPO. most likely office clerks and borrowers. Agency Approval Number: 0607– Estimated Number of Respondents: 0125. DEPARTMENT OF COMMERCE 23,000. Type of Request: Extension of a Estimated Number of Responses per currently approved collection. Submission for OMB Review; Respondent: 1. Burden: 225 hours. Comment Request Estimated Number of Responses: Number of Respondents: 900. The Department of Commerce (DOC) 23,000 Avg Hours Per Response: 15 minutes. has submitted to the Office of Estimated Total Annual Burden on Needs and Uses: The Census Bureau Management and Budget (OMB) for Respondents: 3,680 clearance the following proposal for Copies of this information collection requests an extension of the current OMB clearance of the Questionnaire for collection of information under can be obtained from Cheryl Thompson, provisions of the Paperwork Reduction Regulations and Paperwork Building Permit Officials (SOC–QBPO). The Census Bureau uses the SOC–QBPO Act (44 U.S.C. Chapter 35) Management Branch, Support Services Agency: Bureau of Industry and Division at (202) 692–0043. to collect information from state and local building permit officials, such as Security (BIS). Comments: Comments are invited on: Title: Chemical Weapons Convention (a) Whether the proposed collection of (1) The types of permits they issue, (2) the length of time a permit is valid, (3) Declaration Forms. information is necessary for the proper Agency Form Number: Form 1–1, performance of the functions of the how they store the permits, and (4) the geographic coverage of the permit Form 1–2, Form 1–2A, Form 1–2B, etc. agency, including whether the OMB Approval Number: 0694–0091. information will have practical utility; system. Census Bureau field representatives visit selected permit- Type of Request: Renewal of a (b) the accuracy of agency’s estimate of currently approved collection. the burden of the proposed collection of issuing places and conduct the survey using Computer-Assisted Personal Burden: 20,538 hours. information including the validity of the Average Time Per Response: 10 methodology and assumptions used; (c) Interviewing (CAPI) technology and a lap top computer. We need this minutes–31 hours per response. ways to enhance the quality, utility and Number of Respondents: 929 information to carry out the sampling clarity of the information to be respondents. for the Survey of Housing Starts, Sales collected; and (d) ways to minimize the Needs and Uses: Declarations: The and Completions (OMB number 0607– burden of the collection of information CWC requires annual declarations and 0110), also known as the Survey of on those who are to respond, including reports for activities involving Schedule Construction (SOC). The SOC provides through the use of appropriate 1, Schedule 2, Schedule 3 and widely used measures of construction automated, electronic, mechanical, or Unscheduled Discrete Organic activity, including the economic other technological collection Chemicals (UDOCs) above specified indicators Housing Starts, Housing techniques or other forms of information threshold quantities. The frequency of Completions, and New Housing Sales. technology. Comments may be sent to this collection is the minimum required Cheryl Thompson, Regulations and We plan no changes to the under the CWC. The associated Paperwork Management Branch, information collection. Declaration and Report Handbooks and Support Services Division, U.S. Affected Public: Businesses or other the forms are available from the Department of Agriculture, Rural for-profit. following Internet URL: http:// Development, STOP 0742, 1400 Frequency: Annually. www.cwc.gov/Declarations/ Independence Ave., SW., Washington, _ _ _ Respondent’s Obligation: Voluntary. Handbooks and Forms/cwcIndex html DC 20250–0742. All responses to this Schedule 1: The CWC requires annual notice will be summarized and included Legal Authority: Title 13 U.S.C., section 182. declarations for facilities that produced in the request for OMB approval. All in excess of specified aggregate comments will also become a matter of OMB Desk Officer: Susan Schechter, quantities of Schedule 1 chemicals in public record. (202) 395–5103. the previous calendar year. Dated: March 6, 2003. Copies of the above information Schedule 2: The CWC requires plant Arthur A. Garcia, collection proposal can be obtained by sites that had one or more plants that calling or writing Diana Hynek, Administrator, Rural Housing Service. produced, processed or consumed Departmental Paperwork Clearance [FR Doc. 03–6053 Filed 3–12–03; 8:45 am] Schedule 2 chemicals above the Officer, (202)482–0266, Department of applicable threshold quantity during BILLING CODE 3410–XY–P Commerce, room 6625, 14th and any of the three previous to determine Constitution Avenue, NW., Washington, whether there is an annual declaration DC 20230 (or via the Internet at requirement on past activities. DEPARTMENT OF COMMERCE [email protected]). Schedule 3: The CWC requires annual Submission for OMB Review; Written comments and declarations from plant sites that had Comment Request recommendations for the proposed one or more plants that produced in information collection should be sent excess of specified quantities of one or DOC has submitted to the Office of within 30 days of publication of this more Schedule 3 chemicals in the Management and Budget (OMB) for notice to Susan Schechter, OMB Desk previous calendar year. clearance the following proposal for Officer either by fax (202–395–7245) or UDOCs: Although the majority of collection of information under the email ([email protected]). declarations are required from plant

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sites that produced UDOCs, the DEPARTMENT OF COMMERCE associations. Industry makes extensive declaration requirements for such use of the annual figures on product production involve the fewest forms. Census Bureau class shipments at the U.S. level in its The CWC only requires declarations market analysis, product planning, and from plant sites that produced UDOCs Annual Survey of Manufacturers investment planning. The ASM data are in excess of specified quantities in the used to benchmark and reconcile ACTION: Proposed collection; comment previous calendar year. monthly and quarterly data on request. BIS officials review the information manufacturing production and collected from the data declarations for SUMMARY: The Department of inventories. completeness and accuracy. The data is Commerce, as part of its continuing II. Method of Collection then compiled into a report for effort to reduce paperwork and transmittal to the U.S. National respondent burden, invites the general The ASM statistics are based on a Authority (USNA) and subsequent public and other Federal agencies to survey which includes two components, presentation to the Organization for the take this opportunity to comment on mail and nonmail. The mail portion of Prohibition of Chemical Weapons proposed and/or continuing information the survey is a probability sample of (OPCW). The collected data will also be collections, as required by the about 55,000 manufacturing used by BIS officials to monitor the Paperwork Reduction Act of 1995, establishments selected from a total of aggregate amount of Schedule 1 Public Law 104–13 (44 U.S.C. about 225,000 establishments. These chemicals in the United States to ensure 3506(c)(2)(A)). 225,000 establishments represent all that it is at all times below 1 metric ton manufacturing establishments of DATES: Written comments must be multiunit companies (companies that (as required by Part VI.A.2 of the submitted on or before May 12, 2003. Convention’s Annex on Implementation operate at more than one physical ADDRESSES: Direct all written comments and Verification), and to prepare such location) and all single-establishment to Diana Hynek, Departmental additional reports as the USNA may manufacturing companies that were Paperwork Clearance Officer, reasonably require. mailed forms in the 1997 Economic Department of Commerce, Room 6625, Census. Inspections: Each State Party to the 14th and Constitution Avenue, NW., The nonmail portion of the survey is CWC, including the United States Washington, DC 20230 (or via the defined as all single-establishment Government, has agreed to allow Internet at [email protected]). manufacturing companies that we inspections of certain declared facilities FOR FURTHER INFORMATION CONTACT: tabulated as administrative records in by inspectors employed by the OPCW to Requests for additional information or the 1997 Economic Census. Although ensure that their activities are consistent copies of the information collection this portion includes approximately with obligations under the CWC. The instrument(s) and instructions should 155,000 establishments, it accounted for Department of Commerce is responsible be directed to Mendel D. Gayle, Census less than 2 percent of the estimate for for leading, hosting and escorting Bureau, Room 2108, Building 4, total value of shipments at the total inspections of all facilities in the United Washington, DC 20233, (301) 763–4769 manufacturing level for 1997. No data States, except Department of Defense or via the Internet at are collected from this portion of the and Department of Energy facilities and [email protected]. population, instead data are estimated other United States Government based on selected information obtained SUPPLEMENTARY INFORMATION facilities that notify the USNA of their annually from the administrative decision to be excluded from the CWCR. I. Abstract records of the Internal Revenue Service Affected Public: Individuals, The Census Bureau has conducted the (IRS) and the Social Security businesses or other for-profit Annual Survey of Manufacturers (ASM) Administrative (SSA). This institutions. since 1949 to provide key measures of administrative information, which Respondent’s Obligation: Mandatory. manufacturing activity during includes payroll, total employment, OMB Desk Officer: David Rostker. intercensal periods. In census years industry classification, and physical location, is obtained under conditions Copies of the above information ending in ‘‘2’’ and ‘‘7’’, we mail and collect the ASM as part of the Economic which safeguard the confidentiality of collection proposal can be obtained by both tax and census records. calling or writing Diana Hynek, DOC Census covering the Manufacturing Paperwork Clearance Officer, Office of Sector. This survey is an integral part of III. Data the Chief Information Officer, (202) the Government’s statistical program. MB Number: 0607–0449. 482–0266, Department of Commerce, The ASM furnishes up-to-date estimates Form Number: MA–10000(L), MA– Room 6625, 14th and Constitution of employment and payrolls, hours and 10000(S). Avenue, NW., Washington, DC 20230. wages of production workers, value Type of Review: Regular review. Written comments and added by manufacture, cost of materials, Affected Public: Businesses or other recommendations for the proposed value of shipments by product class, for profit, non-profit Institutions, small information collection should be sent inventories, and expenditures for both businesses or organizations, and State or within 30 days of publication of this plant and equipment and structures. Local Governments. notice to David Rostker, OMB Desk The survey provides data for most of Estimated Number of Respondents: Officer, Room 10202, New Executive these items for each of the 473 55,000. Office Building, Washington, DC 20230. industries as defined in the North Estimated Time Per Response: 3.4 American Industry Classification hours. Dated: March 7, 2003. System (NAICS). It also provides Estimated Total Annual Burden Madeleine Clayton, geographic data by state at a more Hours: 187,000. Departmental Paperwork Clearance Officer, aggregated industry level. Estimated Total Annual Cost: The Office of the Chief Information Officer. The survey also provides valuable estimated cost to the respondents is [FR Doc. 03–5967 Filed 3–12–03; 8:45 am] information to private companies, $4,885,410. BILLING CODE 3510–33–P research organizations, and trade Respondent’s Obligation: Mandatory.

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Legal Authority: Title 13, United of dry pasta products received by all DEPARTMENT OF COMMERCE States Code, sections 182, 224, and 225. AIPC facilities located in the U.S. and Italy. About 1 percent of production is Foreign-Trade Zones Board IV. Request for Comments currently exported. The plant will also [Docket 13–2003] Comments are invited on: (a) Whether be used to manufacture dry pasta for the proposed collection of information U.S. and export markets, but Foreign-Trade Zone 151—Findlay, OH; is necessary for the proper performance manufacturing authority is not being Application for Extension of Zone of the functions of the agency, including requested at this time. Certain dry pasta Status whether the information shall have imports from Italy are subject to anti- practical utility; (b) the accuracy of the dumping/countervailing (AD/CVD) An application has been submitted to agency’s estimate of the burden duties. the Foreign-Trade Zones (FTZ) Board (including hours and cost) of the (the Board), by the Findlay Hancock proposed collection of information; (c) Zone procedures would exempt AIPC Chamber of Commerce (FHCOC), ways to enhance the quality, utility, and from Customs duty payments (including grantee of Foreign-Trade Zone 151, clarity of the information to be AD/CVD) on foreign products that are requesting extension of authority for collected; and (d) ways to minimize the reexported. On domestic sales, the FTZ 151–Site 2 within the Toledo burden of the collection of information company would be able to defer Customs port of entry. The application on respondents, including through the payments until merchandise is shipped was submitted pursuant to the use of automated collection techniques from the plant. FTZ status may also provisions of the Foreign-Trade Zones or other forms of information make a site eligible for benefits provided Act, as amended (19 U.S.C. 81a–81u), technology. under state/local programs. The and the regulations of the Board (15 CFR Comments submitted in response to application indicates that the savings part 400). It was formally filed on March this notice will be summarized and/or from zone procedures will help improve 5, 2003. included in the request for OMB the plant’s international FTZ 151–Site 2 was approved on approval of this information collection; competitiveness. February 10, 1999 (Board Order 1023, they also will become a matter of public In accordance with the Board’s 64 FR 8542, 2/22/99). The authorization record. regulations, a member of the FTZ Staff was for a four-year period ending June Dated: March 7, 2003. has been designated examiner to 30, 2003, subject to extension upon Madeleine Clayton, investigate the application and report to review. The grantee now requests an Management Analyst, Office of the Chief the Board. indefinite extension of authority for FTZ Information Officer. Public comment is invited from 151–Site 2. (A temporary time extension [FR Doc. 03–5965 Filed 3–12–03; 8:45 am] interested parties. Submissions (original (to 6/30/04) was approved until a full Board review of the indefinite extension BILLING CODE 3510–07–P and 3 copies) shall be addressed to the Board’s Executive Secretary at one of proposal can be completed the following addresses: (A(27f)–5–03, 3/4/03)). DEPARTMENT OF COMMERCE In accordance with the Board’s 1. Submissions Via Express/Package regulations, a member of the FTZ Staff Foreign-Trade Zones Board Delivery Services: Foreign-Trade-Zones has been designated examiner to Board, U.S. Department of Commerce, investigate the application and report to [Docket 11–2003] Franklin Court Building—Suite 4100W, the Board. 1099 14th St., NW., Washington, DC Foreign-Trade Zone 75—Phoenix, AZ; Public comment on the application is 20005; or Application for Subzone, American invited from interested parties. Italian Pasta Company, Distribution of 2. Submissions Via the U.S. Postal Submissions (original and 3 copies) Dry Pasta Products, Tolleson, AZ Service: Foreign-Trade-Zones Board, shall be addressed to the Board’s U.S. Department of Commerce, FCB— Executive Secretary at one of the An application has been submitted to Suite 4100W, 1401 Constitution Ave., addresses below: the Foreign-Trade Zones Board (the NW., Washington, DC 20230. 1. Submissions via Express/Package Board) by the City of Phoenix, Arizona, Delivery Services: Foreign-Trade Zones The closing period for their receipt is grantee of FTZ 75, requesting special- Board, U.S. Department of Commerce, May 12, 2003. Rebuttal comments in purpose subzone status for the dry pasta Franklin Court Building—Suite 4100W, response to material submitted during products warehousing/distribution 1099 14th Street NW., Washington, DC the foregoing period may be submitted facility of the American Italian Pasta 20005; or Company (AIPC), in Tolleson, Arizona. during the subsequent 15-day period (to 2. Submissions via the U.S. Postal The application was submitted pursuant May 27, 2003). Service: Foreign-Trade Zones Board, to the provisions of the Foreign-Trade A copy of the application and U.S. Department of Commerce, FCB— Zones Act, as amended (19 U.S.C. 81a– accompanying exhibits will be available Suite 4100W, 1401 Constitution Avenue 81u), and the regulations of the Board for public inspection at the Office of the NW., Washington, DC 20230. (15 CFR part 400). It was formally filed Foreign-Trade-Zones Board’s Executive The closing period for their receipt is on March 4, 2003. Secretary at address Number 1 listed May 12, 2003. Rebuttal comments in The AIPC facility (288,000 sq. ft./1 above, and at the U.S. Department of response to material submitted during bldg. on 22.7 acres) is located at 495 Commerce Export Assistance Center, the foregoing period may be submitted South 99th Avenue, Tolleson (Maricopa 2901 N. Central Ave., Suite 970, during the subsequent 15-day period (to County), Arizona. It was expanded in Phoenix, AZ 85012. May 27, 2003). 2002 and is expected to become fully Dated: March 4, 2003. A copy of the application and operational during the first quarter of accompanying exhibits will be available 2003. The facility (54 employees Dennis Puccinelli, for public inspection at the Office of the initially, with plans to increase to some Executive Secretary. Foreign-Trade Zones Board’s Executive 200) is used for warehousing, [FR Doc. 03–6087 Filed 3–12–03; 8:45 am] Secretary at the first address listed inspection, packaging and distribution BILLING CODE 3510–DS–P above, and at the Office of the Findlay/

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Hancock County Chamber of Commerce, Mixed ortho-acetylsalicylic acid from the International Chemical Weekly 123 E. Main Cross Street, Findlay, Ohio consists of ortho-acetylsalicylic acid (‘‘ICW’’) domestic prices was based on 45840. combined with other inactive the gross price, when instead it should Dated: March 5, 2003. substances such as starch, lactose, have been based on the before-tax price. cellulose, or coloring materials and/or Dennis Puccinelli, Furthermore the petitioner asserts that other active substances. The presence of the Department did not calculate a Executive Secretary. other active substances must be in portion of the normal value build up [FR Doc. 03–6086 Filed 3–12–03; 8:45 am] concentrations less than that specified associated with one of the inputs. BILLING CODE 3510–DS–P for particular nonprescription drug Neither Shandong nor Jilin responded to combinations of bulk aspirin and active petitioner’s comments. substances as published in the DEPARTMENT OF COMMERCE Shandong contends that the Handbook of Nonprescription Drugs, Department incorrectly used a single International Trade Administration eighth edition, American surrogate value for virgin acetic acid to Pharmaceutical Association. This value all the acetic acid inputs in its product is classified under HTSUS calculation of the cost of acetic [A–570–853] subheading 3003.90.0000. Although the anhydride production, when instead it HTSUS subheadings are provided for Notice of Amended Final Results of should have valued the virgin and convenience and customs purposes, the Antidumping Duty Administrative recovered acetic acid separately. The written description of the merchandise Review: Bulk Aspirin from the People’s petitioner contends that the Department under investigation is dispositive. Republic of China correctly applied the surrogate value of Amended Final Results virgin acetic acid to the full quantity of AGENCY: Import Administration, acetic acid used in the production On February 4, 2003, the Department International Trade Administration, process and that Shandong ignores the of Commerce (‘‘the Department’’) Department of Commerce. distinction between ‘‘recovered’’ acetic determined that bulk aspirin from the acid and ‘‘recycled’’ or ‘‘reused’’ acetic ACTION: Notice of amended final results People’s Republic of China (‘‘PRC’’) is acid. In its response to the petitioner’s of antidumping duty administrative not being sold in the United States at comments, Shandong argues that review. less than normal value, as provided in recovered, recycled and reused acetic section 751(a) of the Tariff Act of 1930, EFFECTIVE DATE: acid are identical and should have the March 13, 2003. as amended (‘‘the Act’’). See Bulk FOR FURTHER INFORMATION CONTACT: Julie Aspirin from the People’s Republic of same value. Santoboni or Cole Kyle, Office 1, AD/ China; Final Results of Antidumping In accordance with section 735(e) of CVD Enforcement, Import Duty Administrative Review (‘‘Final the Act, we have determined that Administration, International Trade Results’’), 68 FR 6710 (February 10, certain ministerial errors were made in Administration, U.S. Department of 2003). On February 7 and 10, 2003, our final results margin calculations. Commerce, 14th Street and Constitution Shandong Xinhua Pharmaceutical Co., Specifically we find that the incorrect Avenue, NW., Washington DC 20230; Ltd. (‘‘Shandong’’) and Rhodia, Inc. calculation of certain taxes from the telephone (202) 482–4194 or (202) 482– (‘‘petitioner’’), respectively, filed timely ICW domestic prices and the incorrect 1503, respectively. ministerial error allegations pursuant to surrogate value of Jilin’s packing labor constitute clerical errors. For a detailed Scope of Review 19 CFR 351.224(c)(2). On February 12, 2003 the petitioner filed a reply to discussion of all of the ministerial error The product covered by this review is Shandong’s allegation and on February allegations and the Department’s bulk acetylsalicylic acid, commonly 18, 2003, Shandong filed a response to analysis, see Memorandum to Susan referred to as bulk aspirin, whether or the petitioner’s February 12, 2003 Kuhbach, ‘‘Antidumping Duty not in pharmaceutical or compound submission. The other respondent in Administrative Review of Bulk Aspirin form, not put up in dosage form (tablet, this review, Jilin Henghe from the People’s Republic of China; capsule, powders or similar form for Pharmaceutical Company Ltd. (‘‘Jilin’’), Allegations of Ministerial Errors’ dated direct human consumption). Bulk did not file a ministerial error March 5, 2003, which is on file in the aspirin may be imported in two forms, allegation. Central Records Unit, room B–099 of the as pure ortho-acetylsalicylic acid or as The petitioner contends that the main Department building. mixed ortho-acetylsalicylic acid. Pure Department incorrectly rounded one of In accordance with 19 CFR ortho-acetylsalicylic acid can be either the surrogate values for caustic soda, 351.224(e), we are amending the final in crystal form or granulated into a fine incorrectly deducted taxes from the results of the antidumping duty powder (pharmaceutical form). This domestic price of acetic acid sold on the administrative review of bulk aspirin product has the chemical formula Mumbai Dyes Market and assigned the from the PRC to correct these ministerial C9H8O4. It is defined by the official incorrect surrogate labor value for errors. However, the amended weighted- monograph of the United States packing labor in Jilin’s normal value average margins are identical to the Pharmacopoeia (‘‘USP’’) 23. It is calculations. The petitioner also alleges weighted-average margins in the final classified under the Harmonized Tariff that the Department overstated the results (see Final Results). The Schedule of the United States excise and sales taxes for all domestic weighted-average dumping margins for (‘‘HTSUS’’) subheading 2918.22.1000. values because the deduction of taxes Jilin and Shandong are listed below:

Original weighted-average margin Amended results weighted-aver- Producer/manfacturer/exporter percentage age margin percentage

Jilin Henghe Pharmaceutical Company Ltd...... 0.04 (de minimis) ...... 0.04 (de minimis) Shandong Xinhua Pharmaceutical Co., Ltd...... 0.00 ...... 0.00

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Cash Deposit Rates DEPARTMENT OF COMMERCE 19, 2003, in reply to the petitioners’ ministerial error allegations. BAS and The following antidumping duty International Trade Administration RTL did not submit any ministerial deposits will be required on all [A–821–817] error allegations. ZAO Kremny shipments of bulk aspirin from the PRC (‘‘Kremny’’)/Sual-Kremny-Ural Ltd. entered, or withdrawn from warehouse, Notice of Amended Final (‘‘SKU’’) and Pultwen, the other for consumption, effective on or after Determination of Sales at Less Than respondent covered by the investigation, the publication date of the amended Fair Value: Silicon Metal From the did not submit any ministerial error final results of this administrative Russian Federation allegations or rebuttal comments in review, as provided by section 751(a)(1) reply to petitioners’ ministerial error AGENCY: of the Act: (1) For Shandong and Jilin, Import Administration, allegations. International Trade Administration, no antidumping duty deposit will be Department of Commerce. Silicon Metal Fines required; (2) for merchandise exported ACTION: Petitioners contend that in its Final by manufacturers or exporters not Notice of amended final determination in the less-than-fair-value Determination, the Department used covered in this review but covered in investigation of silicon metal from the overstated production quantities of the original less-than-fair-value Russian Federation. silicon metal in calculating factor usage investigation or a previous review, the rates. Petitioners argue that while the cash deposit will continue to be the EFFECTIVE DATE: March 13, 2003. Department included fines in the total most recent rate published in the final FOR FURTHER INFORMATION CONTACT: production quantities of silicon metal determination or final results for which Cheryl Werner, AD/CVD Enforcement on the basis that silicon metal fines the manufacturer or exporter received Group III, Office IX, Import produced by BAS and Kremny/SKU an individual rate; (3) if the exporter is Administration, International Trade (collectively ‘‘respondents’’) were not a firm covered in this review, the Administration, U.S. Department of similar in size, chemical composition, previous review, or the original Commerce, 14th Street and Constitution and price to commercial grade silicon investigation, but the manufacturer is, Avenue, NW., Washington, DC 20230; metal, and the Department also the cash deposit rate will be the rate telephone: (202) 482–2667. concluded that the quantities of fines established for the most recent period used in the calculation represented only Scope of Investigation for the manufacturer of the sales of fines. Petitioners contend that merchandise; and (4) if neither the For purposes of this investigation, the the production quantities of fines exporter nor the manufacturer is a firm product covered is silicon metal, which reported by respondents and used by covered in this or any previous reviews, generally contains at least 96.00 percent the Department included fines that were the cash deposit rate will be 144.02 but less than 99.99 percent silicon by recycled and consumed in the percent, the ‘‘all others’’ rate established weight. The merchandise covered by production of silicon metal in addition this investigation also includes silicon of the fines that were sold. Petitioners in the less-than-fair-value investigation. metal from Russia containing between claim this overstated the total These cash deposit requirements, 89.00 and 96.00 percent silicon by production quantities used to calculate when imposed, shall remain in effect weight, but containing more aluminum respondents’ factor usage rates, and until publication of the final results of than the silicon metal which contains at therefore, resulted in understated factor the next administrative review. least 96.00 percent but less than 99.99 usage rates. percent silicon by weight. Silicon metal Petitioners contend that the record Assessment Rates currently is classifiable under shows that both respondents consumed Absent an injunction from the U.S. subheadings 2804.69.10 and 2804.69.50 recycled silicon metal fines in the Court of International Trade, the of the Harmonized Tariff Schedule of production of silicon metal during the POI. Petitioners explain that the Department will issue appropriate the United States (‘‘HTSUS’’). This production quantities of fines reported assessment instructions directly to the investigation covers all silicon metal by respondents are larger than the total Customs Service within 15 days of meeting the above specification, regardless of tariff classification. quantities of fines sold by respondents publication of these amended final during the POI. According to results of review. Amendment of Final Results petitioners, Kremny/SKU and Pultwen’s We are issuing and publishing this On February 11, 2003, the Department August 13, 2002, response shows that determination and notice in accordance of Commerce (‘‘the Department’’) they reported a quantity of fines with sections 751(a)(1) and 771(i)(1) of published a notice of final recycled during the POI, which were the Act. determination of sales at less than fair then included in their production value in the investigation of silicon quantity. See Kremny/SKU and Dated: March 6, 2003. metal from the Russian Federation Pultwen’s August 13, 2002, response, at Joseph A. Spetrini, (‘‘Russia’’). Notice of Final 13. Petitioners also contend that the Acting Assistant Secretary for Import Determination of Sales at Less Than Department verified that only a portion Administration. Fair Value: Silicon Metal From the of BAS’s total fine production quantity [FR Doc. 03–6088 Filed 3–12–03; 8:45 am] Russian Federation, 68 FR 6885 was sold. See BAS Verification Report, BILLING CODE 3510–DS–P (February 11, 2003) (‘‘Final at Exhibit 5. Determination’’). Thus, petitioners argue the Also on February 11, 2003, petitioners Department intended to include only timely filed an allegation that the the quantity of silicon metal fines sold Department made ministerial errors in by respondents in the total production the Final Determination, pursuant to 19 quantity but erroneously included CFR 351.224(c). Bratsk Aluminum recycled fines as well. Petitioners Smelter (‘‘BAS’’) and (‘‘RTL’’) submitted explain that to correct this error, the timely rebuttal comments on February Department should (1) subtract the

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quantities of fines that were recycled does not allocate costs to byproducts. finished goods. BAS and RTL note that and consumed in the production from This would be contrary to the BAS included an allocated amount for the total quantities of fines included in Department’s decision in the Final the hours of executives, managers, and the total production quantities and (2) Determination. See Issues and Decision specialists who are involved indirectly recalculate respondents’ factor usage Memorandum, at Comment 11. A in the production of silicon metal, in its rates using the reduced production ministerial error is defined under 19 reported direct labor. BAS and RTL quantities. Petitioners explain that the CFR 351.224(f) as ‘‘an error in addition, contend that the labor cost of such volume of fines recycled by BAS during subtraction, or other arithmetic personnel is normally classified as the POI is not in the record of this function, clerical error resulting from factory overhead or selling, general and investigation, and therefore, as facts inaccurate copying, duplication, or the administrative expenses under standard available, the Department should like, and any other similar type of accounting principles. Accordingly, subtract the volume of fines sold that unintentional error which the Secretary because the Department values factory was verified from the total quantity of considers ministerial.’’ Petitioners’ overhead and general and fines produced during the POI. request, however, would require the administrative expenses using the Alternatively, petitioners also suggest Department to revisit its entire financial statements of a surrogate that the Department could estimate the methodology for recognizing fines. company, under the non-market volume of fines recycled by BAS using Accordingly, we have not made the economy methodology, it is not the percentage amount of fines recycled requested change, because it is not necessary to include an amount for by Kremny in relation to its total output. ‘‘ministerial’’ in nature. indirect labor in the Department’s BAS and RTL contend that the Indirect Labor margin calculation, because this would Department determined in its Final double-count these labor expenses. Determination that 0–5 mm silicon Petitioners contend that the Therefore, because BAS’s reported metal, or fines, should be included in Department did not include indirect direct labor already includes allocated the production quantity because labor in the calculation of normal value amounts for indirect labor, and because ‘‘excluding fines from the production for BAS in its Final Determination. indirect labor is also included in the quantity used to calculate the reported Petitioners argue that the Department surrogate financial information used in factors would overstate the factors of indicated that it intended to include the margin calculation, the Department production.’’ See Issues and Decision both direct labor and indirect labor in should not include additional labor Memorandum, at Comment 11. BAS and the calculation of normal value for BAS, hours in its margin calculation. RTL argue that the Department noted: according to the BAS and RTL Final That fines were within the scope of this Analysis Memorandum. See Analysis Department’s Position Memorandum of Bratsk Aluminum investigation; that it verified that BAS We agree with petitioners. We Smelter and Rual Trade Limited: Final made sales of fines; and that these sales inadvertently excluded indirect labor in Determination in the Less Than Fair were not made at a very substantial the calculation of normal value for BAS Value Investigation of Silicon Metal discount compared to normal-sized in the Final Determination. As BAS silicon metal. See id. Thus, BAS and from the Russian Federation, at page 5 explained above, its reported indirect RTL argue that the Department (February 3, 2003) (‘‘BAS and RTL Final labor consists of the per-unit hours of determined that fines produced by BAS Analysis Memo’’) (under the Normal personnel involved in the maintenance were commercial-grade silicon metal. Value calculation heading: and servicing (e.g., cleaning, catering) of Accordingly, BAS and RTL explain that ‘‘TOT_LABOR = DIRLAB_F + the production facilities, and involved pursuant to Silicon Metal from Brazil, INDLAB_F’’). Petitioners explain that it in the handling of transportation of raw the Department properly determined is necessary to include indirect labor in materials and finished goods, and is that production costs should be the calculation of normal value because properly classified as indirect labor. allocated to fines produced by BAS. the surrogate-valued amount for factory BAS and RTL also contend that overhead used by the Department does Therefore, we revised our Final recycled fines were not included in the not include any amount for indirect Determination, to include BAS’s reported production quantities for BAS, labor. Petitioners explain that the reported indirect labor in BAS’s margin which is demonstrated by the record. computer program used by the program calculation. BAS and RTL explain that production Department to calculate the final margin Wood Charcoal Freight Cost documents show a small amount of for BAS does not include indirect labor material added to prevent the molten in the calculation of normal value. Petitioners argue that the Department metal from sticking to the slab, but this Petitioners contend that the Department incorrectly calculated the wood amount was not included in BAS’s should include indirect labor in the charcoal freight cost for BAS in its Final reported total production quantity. calculation of normal value for BAS. Determination. Petitioners argue that the BAS and RTL contend that petitioners Department calculated the wrong Department’s Position have identified a methodological issue weighted-average distance between BAS We disagree with petitioners. regarding how to account for labor costs and wood charcoal suppliers. Petitioners’ request that the not directly related to production of Petitioners contend that the Department Department exclude recycled fines from subject merchandise under a non- should correct its wood charcoal freight the production quantity is not market economy methodology, rather cost calculation. ministerial in nature, but rather involves than an arithmetic or duplication error BAS and RTL agree with petitioners a methodological change. This is that is appropriate to address as a that the Department miscalculated the because if the Department were to ministerial error. BAS and RTL explain weighted-average distance of BAS’s remove recycled fines from the total that BAS reported, as indirect labor, the wood charcoal suppliers. However, BAS production quantity of silicon metal, we per-unit hours of personnel involved in and RTL disagree with petitioners’ would not be allocating any costs to the maintenance and servicing (e.g., calculation of the per-unit freight cost their production. Therefore, we would, cleaning, catering) of the production for wood charcoal, and propose their in effect, be treating recycled fines as facilities, and involved in the handling own calculation of the per-unit freight byproducts because the Department of transportation of raw materials and cost for wood charcoal.

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Department’s Position correct per-unit freight cost for wood File from Cheryl Werner, Case Analyst We agree with petitioners and BAS charcoal in BAS’s margin program to James C. Doyle, Program Manager, and RTL, that we incorrectly calculated calculation. Final Analysis for BAS for the Amended the weighted-average distance between Therefore, we are amending the Final Final Determination of the Antidumping BAS and wood charcoal suppliers. In Determination to reflect the correction Duty Investigation of Silicon Metal from the Final Determination, we of the above-cited ministerial errors. All the Russian Federation, dated March 6, inadvertently excluded certain suppliers changes made to the margin program 2003. of wood charcoal for BAS. We revised can be found in the analysis The weighted-average dumping our Final Determination, to include the memorandum. See Memorandum to the margins are as follows:

Amended final Final weighted-av- weighted average Producer/manufacturer exporter erage margin margin (percent) (percent)

Bratsk Aluminum Smelter ...... 77.51 79.42 ZAO Kremny/Sual-Kremny-Ural Ltd ...... 54.79 56.11

Consequently, we are issuing and from the Republic of Korea covering the 7219.1300.81,1 7219.14.0030, publishing this amended final period July 1, 2000, through June 30, 7219.14.0065, 7219.14.0090, determination and notice in accordance 2001. See Stainless Steel Sheet and 7219.32.0005, 7219.32.0020, with section 751(a)(1) of the Act. Strip in Coils From the Republic of 7219.32.0025, 7219.32.0035, Dated: March 6, 2003. Korea; Final Results and Partial 7219.32.0036, 7219.32.0038, Joseph A. Spetrini, Rescission of Antidumping Duty 7219.32.0042, 7219.32.0044, 7219.33.0005, 7219.33.0020, Acting Assistant Secretary for Import Administrative Review, 68 FR 6713 Administration. (February 10, 2003) (‘‘Final Results’’). 7219.33.0025, 7219.33.0035, 7219.33.0036, 7219.33.0038, [FR Doc. 03–6089 Filed 3–12–03; 8:45 am] On February 10, 2003, respondent 7219.33.0042, 7219.33.0044, BILLING CODE 3510–DS–P Pohang Iron & Steel Co., Ltd. 7219.34.0005, 7219.34.0020, (‘‘POSCO’’) filed a ministerial error 7219.34.0025, 7219.34.0030, allegation pursuant to section DEPARTMENT OF COMMERCE 7219.34.0035, 7219.35.0005, 351.224(c)(2) of the Department’s 7219.35.0015, 7219.35.0030, International Trade Administration regulations. Petitioners did not 7219.35.0035, 7219.90.0010, comment on any ministerial errors 7219.90.0020, 7219.90.0025, [A–580–834] concerning the final results of this 7219.90.0060, 7219.90.0080, Stainless Steel Sheet and Strip in Coils review. As a result of our analysis of 7220.12.1000, 7220.12.5000, From The Republic of Korea: Notice of POSCO’s allegations, we are amending 7220.20.1010, 7220.20.1015, Amended Final Results of the Final Results in the antidumping 7220.20.1060, 7220.20.1080, Antidumping Duty Administrative review of SSSS from the Republic of 7220.20.6005, 7220.20.6010, 7220.20.6015, 7220.20.6060, Review Korea. 7220.20.6080, 7220.20.7005, AGENCY: Import Administration, Scope of the Review 7220.20.7010, 7220.20.7015, International Trade Administration, 7220.20.7060, 7220.20.7080, Department of Commerce. For purposes of this administrative 7220.20.8000, 7220.20.9030, review, the products covered are certain ACTION: Amended final results of 7220.20.9060, 7220.90.0010, stainless steel sheet and strip in coils. antidumping duty administrative review 7220.90.0015, 7220.90.0060, and of stainless steel sheet and strip in coils Stainless steel is an alloy steel 7220.90.0080. Although the HTS from the Republic of Korea. containing, by weight, 1.2 percent or subheadings are provided for less of carbon and 10.5 percent or more convenience and Customs purposes, the EFFECTIVE DATE: March 13, 2003. of chromium, with or without other Department’s written description of the FOR FURTHER INFORMATION CONTACT: elements. The subject sheet and strip is merchandise under review is Laurel LaCivita or Robert Bolling, a flat-rolled product in coils that is dispositive. Enforcement Group III, Import greater than 9.5 mm in width and less Excluded from the scope of this Administration, International Trade than 4.75 mm in thickness, and that is review are the following: (1) Sheet and Administration, U.S. Department of annealed or otherwise heat treated and strip that is not annealed or otherwise Commerce, 1401 Constitution Avenue, pickled or otherwise descaled. The heat treated and pickled or otherwise NW., Washington, DC 20230; telephone: subject sheet and strip may also be descaled, (2) sheet and strip that is cut (202)482–4243, or (202)482–3434, further processed (e.g., cold-rolled, to length, (3) plate (i.e., flat-rolled respectively. polished, aluminized, coated, etc.) stainless steel products of a thickness of 4.75 mm or more), (4) flat wire (i.e., provided that it maintains the specific Amendment of Final Results cold-rolled sections, with a prepared dimensions of sheet and strip following edge, rectangular in shape, of a width of On February 10, 2003, the U.S. such processing. Department of Commerce not more than 9.5 mm), and (5) razor (‘‘Department’’) published in the The merchandise subject to this Federal Register the results of its review is classified in the Harmonized 1 Due to changes to the HTS numbers in 2001, administrative review of the Tariff Schedule of the United States 7219.13.0030, 7219.13.050, 7219.13.0070, and (HTS) at subheadings: 7219.13.0031, 7219.13.0080 are now 7219. 13.0031, antidumping duty order on stainless 7219.13.0051,7219.13.0071, and 7219.13.0081, steel sheet and strip in coils (‘‘SSSS’’) 7219.13.0051, 7219.13.0071, respectively.

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blade steel. Razor blade steel is a flat- more than 1.0 percent, chromium of percent or less in 50 mm. It is generally rolled product of stainless steel, not between 19 and 22 percent, aluminum provided in thicknesses between 0.635 further worked than cold-rolled (cold- of no less than 5.0 percent, phosphorus and 0.787 mm, and in widths of 25.4 reduced), in coils, of a width of not of no more than 0.045 percent, sulfur of mm. This product is most commonly more than 23 mm and a thickness of no more than 0.03 percent, lanthanum used in the manufacture of television 0.266 mm or less, containing, by weight, of less than 0.002 or greater than 0.05 tubes and is currently available under 12.5 to 14.5 percent chromium, and percent, and total rare earth elements of proprietary trade names such as certified at the time of entry to be used more than 0.06 percent, with the ‘‘Durphynox 17.’’ 4 in the manufacture of razor blades. See balance iron. Finally, three specialty stainless steels chapter 72 of the HTS, ‘‘Additional U.S. Permanent magnet iron-chromium- typically used in certain industrial Note’’ 1(d). cobalt alloy stainless strip is also blades and surgical and medical In response to comments by interested excluded from the scope of this review. instruments are also excluded from the parties, the Department has determined This ductile stainless steel strip scope of this review. These include that certain specialty stainless steel contains, by weight, 26 to 30 percent stainless steel strip in coils used in the products are also excluded from the chromium, and 7 to 10 percent cobalt, production of textile cutting tools (e.g., scope of this review. These excluded with the remainder of iron, in widths carpet knives).5 This steel is similar to products are described below. 228.6 mm or less, and a thickness AISI grade 420 but containing, by Flapper valve steel is defined as between 0.127 and 1.270 mm. It exhibits weight, 0.5 to 0.7 percent of stainless steel strip in coils containing, magnetic remanence between 9,000 and molybdenum. The steel also contains, by weight, between 0.37 and 0.43 12,000 gauss, and a coercivity of by weight, carbon of between 1.0 and percent carbon, between 1.15 and 1.35 between 50 and 300 oersteds. This 1.1 percent, sulfur of 0.020 percent or percent molybdenum, and between 0.20 product is most commonly used in less, and includes between 0.20 and and 0.80 percent manganese. This steel electronic sensors and is currently 0.30 percent copper and between 0.20 also contains, by weight, phosphorus of available under proprietary trade names and 0.50 percent cobalt. This steel is 0.025 percent or less, silicon of between such as ‘‘Arnokrome III.’’ 2 sold under proprietary names such as 0.20 and 0.50 percent, and sulfur of Certain electrical resistance alloy steel ‘‘GIN4 Mo.’’ The second excluded 0.020 percent or less. The product is is also excluded from the scope of this stainless steel strip in coils is similar to manufactured by means of vacuum arc review. This product is defined as a AISI 420–J2 and contains, by weight, remelting, with inclusion controls for non-magnetic stainless steel carbon of between 0.62 and 0.70 sulphide of no more than 0.04 percent manufactured to American Society of percent, silicon of between 0.20 and and for oxide of no more than 0.05 Testing and Materials (‘‘ASTM’’) 0.50 percent, manganese of between percent. Flapper valve steel has a tensile specification B344 and containing, by 0.45 and 0.80 percent, phosphorus of no strength of between 210 and 300 ksi, weight, 36 percent nickel, 18 percent more than 0.025 percent and sulfur of yield strength of between 170 and 270 chromium, and 46 percent iron, and is no more than 0.020 percent. This steel ksi, plus or minus 8 ksi, and a hardness most notable for its resistance to high has a carbide density on average of 100 (Hv) of between 460 and 590. Flapper temperature corrosion. It has a melting carbide particles per 100 square valve steel is most commonly used to point of 1390 degrees Celsius and microns. An example of this product is produce specialty flapper valves in displays a creep rupture limit of 4 ‘‘GIN5’’ steel. The third specialty steel compressors. kilograms per square millimeter at 1000 has a chemical composition similar to Also excluded is a product referred to degrees Celsius. This steel is most as suspension foil, a specialty steel AISI 420 F, with carbon of between 0.37 commonly used in the production of and 0.43 percent, molybdenum of product used in the manufacture of heating ribbons for circuit breakers and suspension assemblies for computer between 1.15 and 1.35 percent, but industrial furnaces, and in rheostats for lower manganese of between 0.20 and disk drives. Suspension foil is described railway locomotives. The product is as 302/304 grade or 202 grade stainless 0.80 percent, phosphorus of no more currently available under proprietary than 0.025 percent, silicon of between steel of a thickness between 14 and 127 3 trade names such as ‘‘Gilphy 36.’’ 0.20 and 0.50 percent, and sulfur of no microns, with a thickness tolerance of Certain martensitic precipitation- plus-or-minus 2.01 microns, and surface more than 0.020 percent. This product hardenable stainless steel is also is supplied with a hardness of more glossiness of 200 to 700 percent Gs. excluded from the scope of this review. Suspension foil must be supplied in coil than Hv 500 guaranteed after customer This high-strength, ductile stainless processing, and is supplied as, for widths of not more than 407 mm, and steel product is designated under the example, ‘‘GIN6’’.6 with a mass of 225 kg or less. Roll marks Unified Numbering System (‘‘UNS’’) as may only be visible on one side, with S45500-grade steel, and contains, by Ministerial Error no scratches of measurable depth. The weight, 11 to 13 percent chromium, and material must exhibit residual stresses A ministerial error is defined in 7 to 10 percent nickel. Carbon, section 351.224(f) of our regulations as of 2 mm maximum deflection, and manganese, silicon and molybdenum flatness of 1.6 mm over 685 mm length. ‘‘an error in addition, subtraction, or each comprise, by weight, 0.05 percent other arithmetic function, clerical error Certain stainless steel foil for or less, with phosphorus and sulfur automotive catalytic converters is also resulting from inaccurate copying, each comprising, by weight, 0.03 duplication, or the like, and any other excluded from the scope of this review. percent or less. This steel has copper, This stainless steel strip in coils is a similar type of unintentional error niobium, and titanium added to achieve which the Secretary considers specialty foil with a thickness of aging, and will exhibit yield strengths as between 20 and 110 microns used to ministerial.’’ Section 351.224(e) of our high as 1700 Mpa and ultimate tensile regulations provides that we ‘‘will produce a metallic substrate with a strengths as high as 1750 Mpa after honeycomb structure for use in aging, with elongation percentages of 3 4 automotive catalytic converters. The ‘‘Durphnox 17’’ is a trademark of Imphy, S.A. 5 This list of uses is illustrative and provided for steel contains, by weight, carbon of no 2 ‘‘Arnikrome III’’ is a trademark of the Arnold descriptive purposes only. more than 0.030 percent, silicon of no Engineering Company. 6 ‘‘GIN4 Mo,’’ ‘‘GIN5’’ and ‘‘GIN6’’ are the more than 1.0 percent, manganese of no 3 ‘‘Gilphy 36’’ is a trademark of Imply, S.A proprietary grades of Hitachi Metals America, Ltd.

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analyze any comments received and, if sequence of the computer program. that POSCO erroneously equated the appropriate * * * correct any Consequently, these models did not find total cost of production in the United ministerial error by amending * * * the an appropriate match in the home States (‘‘TCOMU’’) with the total cost of final results of review. * * *’’ After market and were compared to CV in manufacturing rather than the total cost reviewing POSCO’s allegations, we have error for the final results of review. of production, thereby omitting selling, determined in accordance with section To correct this error, POSCO general and administrative expenses 351.224 of the Department’s regulations, proposed a number of programming (SG&A) from the calculation of TCOMU. that the final results of review include changes: (1) Insert language creating a Therefore, we have revised our duplicate cost file for the U.S. sales; (2) the ministerial error discussed below. calculations to appropriately merge the create the VCOM and TCOM COP and CV files, and to correctly Comment 1: L-Grade Adjustment for information for the U.S. sales before Models Sold Exclusively in the United merging the cost files with the home calculate TCOMU. See Analysis States market sales files; and, (3) delete the memorandum for the amended final POSCO contends that the Department calculation of VCOM and TCOM after results of review for stainless steel sheet made an error in merging the cost of the merge of the COP and home market and strip in coils from Korea—Pohang production (‘‘COP’’) and constructive sales databases. See POSCO’s February Iron and Steel Company (‘‘POSCO’’) value (‘‘CV’’) files that failed to 10, 2003 ministerial error allegation dated March 6, 2003. implement its stated decision in the letter. Amended Final Results final results of review to apply the Department’s Position minor corrections to the L-grade We are amending the final results of adjustment reported at verification to We agree with POSCO that the the administrative review on SSSS from those models sold exclusively in the program used in the final results of the Republic of Korea covering the review failed to correctly apply the L- United States. As a result, POSCO period July 1, 2000, through June 30, claims that certain models sold grade adjustment to the models sold 2001, pursuant to section 751(h) of the exclusively in the U.S. market did not exclusively in the United States, and Act. As a result of this redetermination, have variable or total cost of therefore, to determine the appropriate manufacturing (‘‘VCOM’’ or ‘‘TCOM’’) model matches for the final results of the recalculated final weighted-average applied to them during the model match review. However, our analysis reveals margin for POSCO is as follows:

Weighted average Revised weighted Exporter/manufacturer margin in the final average margin (percent) (percent)

POSCO ...... 98 .92

The cash deposit rate for POSCO of DEPARTMENT OF COMMERCE 14th and Constitution Avenue, NW, 0.92 percent ad valorem is effective on Washington, DC 20230 (or via the all shipments of the subject National Oceanic and Atmospheric Internet at [email protected]). merchandise entered, or withdrawn Administration FOR FURTHER INFORMATION CONTACT: from warehouse, for consumption on or [I.D. 031003A] Requests for additional information or after the date of publication of this copies of the information collection notice, and will remain in effect until Proposed Information Collection; instrument and instructions should be publication of the final results of the Comment Request; Application for directed to Patricia Lawson, 301–713– next administrative review. Commercial Fisheries Authorization 2322, or at [email protected]. Under Section 118 of the Marine Accordingly, the Department will SUPPLEMENTARY INFORMATION: Mammal Protection Act determine, and the Customs Service will I. Abstract assess, antidumping duties on all entries AGENCY: National Oceanic and of subject merchandise from POSCO Atmospheric Administration (NOAA). The Marine Mammal Protection Act (MMPA) requires any commercial fisher during the period July 1, 2000, through ACTION: Notice. operating in a Category I or II fishery to June 30, 2001, in accordance with this register for a certificate of authorization amended final results. SUMMARY: The Department of Commerce, as part of its continuing that will allow the fisher to take marine This amended final results and notice effort to reduce paperwork and mammals incidental to commercial are in accordance with sections respondent burden, invites the general fishing operations. Category I and II 751(a)(1) of the Act (19 U.S.C. public and other Federal agencies to fisheries are those identified by NOAA 1675(a)(1)) and section 351.221 of the take this opportunity to comment on as having either frequent or occasional Department’s regulations. proposed and/or continuing information takings of marine mammals. Dated: March 4, 2003. collections, as required by the II. Method of Collection Faryar Shirzad, Paperwork Reduction Act of 1995, Public Law 104–13 (44 U.S.C. A paper form is used. Assistant Secretary for Import 3506(c)(2)(A)). Administration. III. Data [FR Doc. 03–6090 Filed 3–12–03; 8:45 am] DATES: Written comments must be OMB Number: 0648–0293. BILLING CODE 3510–DS–P submitted on or before May 12, 2003. Form Number: None. ADDRESSES: Direct all written comments Type of Review: Regular submission. to Diana Hynek, Departmental Affected Public: Business or other for- Paperwork Clearance Officer, profit organizations, individuals or Department of Commerce, Room 6625, households.

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Estimated Number of Respondents: upon written request or by appointment Agency Approval Number: 0651– 12,000. in the following office(s):Permits, 0038. Estimated Time Per Response: 15 Conservation and Education Division, Type of Request: Reinstatement, with minutes for a new application, and 9 Office of Protected Resources, NMFS, change, of a previously approved minutes for a renewal application. 1315 East-West Highway, Room 13705, collection for which approval has Estimated Total Annual Burden Silver Spring, MD 20910; phone expired. Hours: 2,800. (301)713–2289; fax (301)713–0376; Burden: 3,100 hours annually. Estimated Total Annual Cost to andNortheast Region, NMFS, One Number of Respondents: 8,100 Public: $304,440. Blackburn Drive, Gloucester, MA responses per year. 01930–2298; phone (978)281–9200; fax Avg. Hours Per Response: Based on IV. Request for Comments (978)281–9371. results from testing the various types of surveys with the representative Comments are invited on: (a) whether FOR FURTHER INFORMATION CONTACT: the proposed collection of information customer groups and with internal test Jennifer Skidmore or Ruth Johnson, groups, the USPTO estimates that it is necessary for the proper performance (301)713–2289. of the functions of the agency, including takes the public 15 minutes to complete SUPPLEMENTARY INFORMATION: whether the information shall have The telephone surveys and face-to-face practical utility; (b) the accuracy of the requested amendment has been granted interviews, 5 minutes to complete agency’s estimate of the burden under the authority of the Marine questionnaires, customer surveys (both (including hours and cost) of the Mammal Protection Act of 1972, as paper and electronic), and comment proposed collection of information; (c) amended (16 U.S.C. 1361 et seq.), the cards, and 2 hours to participate in ways to enhance the quality, utility, and provisions of 50 CFR 216.39 of the focus groups. The USPTO estimates that clarity of the information to be Regulations Governing the Taking and it takes the public 30 minutes to collected; and (d) ways to minimize the Importing of Marine Mammals (50 CFR complete the paper version of the burden of the collection of information part 216), the Endangered Species Act of annual patent and annual trademark on respondents, including through the 1973, as amended (ESA; 16 U.S.C. 1531 customer satisfaction surveys, but only use of automated collection techniques et seq.), the provisions of the regulations 20 minutes to complete the same survey or other forms of information governing the taking, importing, and electronically. technology. exporting of endangered and threatened Needs and Uses: The public uses the Comments submitted in response to species (50 CFR parts 222–226). various types of surveys to express their this notice will be summarized and/or Issuance of this amendment, as opinions about the services and included in the request for OMB required by the ESA was based on a information products offered by the approval of this information collection; finding that such permit: (1) Was USPTO and about the quality of the they also will become a matter of public applied for in good faith; (2) will not customer service that they receive from record. operate to the disadvantage of the the USPTO. Additionally, these various endangered species which is the subject surveys allow the public to offer their Dated: March 7, 2003. of this permit; and (3) is consistent with suggestions and comments concerning Gwellnar Banks, the purposes and policies set forth in the USPTO, its services and information Management Analyst, Office of the Chief section 2 of the ESA. products, and its customer service. Information Officer. Dated: March 7, 2003. Depending on the type of survey, the [FR Doc. 03–6106 Filed 3–12–03; 8:45 am] Stephen L. Leathery, public can provide their comments on BILLING CODE 3510–22–S Chief, Permits, Conservation and Education the spot to the interviewer, or complete Division, Office of Protected Resources, the survey at their own pace and either mail their responses to the USPTO or DEPARTMENT OF COMMERCE National Marine Fisheries Service. [FR Doc. 03–6105 Filed 3–12–03; 8:45 am] submit their responses electronically via a web-based survey. The USPTO uses National Oceanic and Atmospheric BILLING CODE 3510–22–S the data collected from these surveys for Administration strategic planning, the allocation of [I.D. 022103F] DEPARTMENT OF COMMERCE resources, the establishment of performance goals, and the verification Marine Mammals; File No. 876–1402 Patent and Trademark Office and establishment of service standards. The USPTO also uses this data to assess AGENCY: National Marine Fisheries Submission for OMB Review; customer satisfaction with USPTO Service (NMFS), National Oceanic and Comment Request products and services, assess customer Atmospheric Administration (NOAA), priorities in service characteristics, and Commerce. The United States Patent and identify areas where service levels differ Trademark Office (USPTO) has ACTION: Issuance of permit amendment. from customer expectations. submitted to the Office of Management Affected Public: Individuals or SUMMARY: Notice is hereby given that and Budget (OMB) for clearance the households, business or other for-profit, Howard C. Rosenbaum, Ph.D. and following proposal for collection of and not-for-profit institutions. Robert DeSalle, Ph.D., American information under the provisions of the Frequency: On occasion. Museum of Natural History, Molecular Paperwork Reduction Act (44 U.S.C. Respondent’s Obligation: Voluntary. Systematics Laboratory, 79th St. & Chapter 35). OMB Desk Officer: David Rostker, Central Park West, New York, New York Agency: United States Patent and (202) 395–3897. 10024, has been issued an amendment Trademark Office (USPTO). Copies of the above information to scientific research Permit No. 876– Title: Customer Input—Patent and collection proposal can be obtained by 1402–00 to extend the expiration date Trademark Customer Surveys. calling or writing Susan K. Brown, through June 30, 2003. Form Number(s): Form numbers will Records Officer, Office of Data ADDRESSES: The amendment and related be determined as applicable for the Architecture and Services, Data documents are available for review various surveys. Administration Division, USPTO, Suite

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310, 2231 Crystal Drive, Washington, Recordkeeping burden. OMB invites Relay Service (FIRS) at 1–800–877– DC 20231, by telephone at 703–308– public comment. 8339. 7400, or by e-mail at The Department of Education is [FR Doc. 03–5998 Filed 3–12–03; 8:45 am] [email protected]. especially interested in public comment BILLING CODE 4000–01–P Written comments and addressing the following issues: (1) Is recommendations for the proposed this collection necessary to the proper information collection should be sent on functions of the Department; (2) will DEPARTMENT OF EDUCATION or before April 14, 2003 to David this information be processed and used Rostker, OMB Desk Officer, Room in a timely manner; (3) is the estimate Brown v. Board of Education 50th 10202, New Executive Office Building, of burden accurate; (4) how might the Anniversary Commission; Meeting Washington, DC 20503. Department enhance the quality, utility, Dated: March 6, 2003. and clarity of the information to be AGENCY: Brown v. Board of Education Susan K. Brown, collected; and (5) how might the 50th Anniversary Commission, U.S. Records Officer, USPTO, Office of Data Department minimize the burden of this Department of Education (ED). Architecture and Services, Data collection on the respondents, including ACTION: Notice of meeting. Administration Division. through the use of information [FR Doc. 03–6049 Filed 3–12–03; 8:45 am] technology. SUMMARY: This notice provides the BILLING CODE 3510–16–P Dated: March 7, 2003. schedule of a forthcoming meeting of John D. Tressler, the Brown v. Board of Education 50th Leader, Regulatory Management Group, Anniversary Commission. This notice Office of the Chief Information Officer. DEPARTMENT OF EDUCATION also describes the functions of the Federal Student Aid commission. This document is intended Notice of Proposed Information to notify the general public of their Type of Review: Revision of a Collection Requests opportunity to attend. currently approved collection. DATE AND TIME: March 27, 2003, at 8:45 AGENCY: Department of Education. Title: Student Aid Internet Gateway (SAIG) Enrollment Document (JS). a.m. SUMMARY: The Leader, Regulatory Frequency: On occasion. ADDRESSES: Harvard University— Management Group, Office of the Chief Affected Public: Not-for-profit Harvard Law School—Pound Hall, 1536 Information Officer, invites comments institutions (primary), Businesses or Massachusetts Avenue, Cambridge, MA on the proposed information collection other for-profit, State, Local, or Tribal 02138, (617) 495–3100. requests as required by the Paperwork Gov’t, SEAs or LEAs. Reduction Act of 1995. FOR FURTHER INFORMATION CONTACT: Reporting and Recordkeeping Hour Daniel W. Sutherland, Chief of Staff, DATES: Interested persons are invited to Burden: submit comments on or before May 12, 330 C Street SW., Washington, DC Responses: 6902. 2003. 20202, (202) 205–8162. Burden Hours: 6902. SUPPLEMENTARY INFORMATION: Section SUPPLEMENTARY INFORMATION: The 3506 of the Paperwork Reduction Act of Abstract: Enrollment in SAIG allows Brown v. Board of Education 50th 1995 (44 U.S.C. Chapter 35) requires eligible entities to exchange Title IV Anniversary Commission is established that the Office of Management and information electronically with the under Public Law 107–41 to Budget (OMB) provide interested Department of Education. Users are able commemorate the 50th anniversary of Federal agencies and the public an early to receive, transmit, view and update the Brown decision. The Commission, opportunity to comment on information student financial aid data via SAIG. in conjunction with the U.S. collection requests. OMB may amend or Eligible respondents include Department of Education, is responsible waive the requirement for public postsecondary schools that participate for planning and coordinating public consultation to the extent that public in federal student financial aid education activities and initiatives. participation in the approval process programs, financial aid servicers, state Also, the Commission, in cooperation would defeat the purpose of the and guaranty agencies, lenders, and with the Brown Foundation for information collection, violate State or need analysis servicers. Educational Equity, Excellence, and Federal law, or substantially interfere Written requests for information Research in Topeka, Kansas, and such with any agency’s ability to perform its should be addressed to Vivian Reese, other public or private entities as the statutory obligations. The Leader, Department of Education, 400 Maryland Commission deems appropriate, is Regulatory Management Group, Office Avenue, SW., Room 4050, Regional responsible for encouraging, planning, of the Chief Information Officer, Office Building 3, Washington, DC developing, and coordinating publishes that notice containing 20202–4651 or to the e-mail address observances of the anniversary of the proposed information collection [email protected]. Requests may also Brown decision. The meeting of the requests prior to submission of these be faxed to 202–708–9346. Please Commission is open to the public. requests to OMB. Each proposed specify the complete title of the Individuals who will need information collection, grouped by information collection when making accommodations for a disability in order office, contains the following: (1) Type your request. to attend the meeting (i.e., interpreting of review requested, e.g., new, revision, Comments regarding burden and/or services, assistive listening devices, extension, existing or reinstatement; (2) the collection activity requirements materials in alternative format) should Title; (3) Summary of the collection; (4) should be directed to Joseph Schubart at notify Gwendolen Long at (202) 205– Description of the need for, and his e-mail address [email protected]. 9556 by no later than March 21, 2003. proposed use of, the information; (5) Individuals who use a We will attempt to meet requests after Respondents and frequency of telecommunications device for the deaf that date, but cannot guarantee collection; and (6) Reporting and/or (TDD) may call the Federal Information availability.

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Dated: March 6, 2003. Monitor and Maintain under Current SUPPLEMENTARY INFORMATION: DOE and Gerald A. Reynolds, Operations, and No-Action. NYSERDA intend to prepare a revised Assistant Secretary for Civil Rights. DATES: DOE and NYSERDA are inviting draft Environmental Impact Statement [FR Doc. 03–5999 Filed 3–12–03; 8:45 am] public comments on the scope and (EIS) for Decommissioning and/or Long- BILLING CODE 4000–01–M content of the Decommissioning and/or Term Stewardship at the WVDP and Long-Term Stewardship EIS during a Western New York Nuclear Service public comment period commencing Center to examine the potential DEPARTMENT OF ENERGY with the date of publication of this environmental impacts of the proposed Notice and ending on April 28, 2003. action to decommission and/or maintain Notice of Intent to Prepare an DOE and NYSERDA will hold two long-term stewardship at the Center. Environmental Impact Statement for public scoping meetings on the EIS at The NRC, the EPA, and NYSDEC will Decommissioning and/or Long-Term the Ashford Office Complex, located at participate as cooperating agencies Stewardship at the West Valley 9030 Route 219 in the Town of Ashford, under NEPA. NYSDEC will also Demonstration Project and Western NY, from 7 to 9:30 p.m. on April 9, 2003 participate as an involved agency under New York Nuclear Service Center and April 10, 2003. SEQRA with respect to NYSERDA’s proposed actions. DOE, under NEPA, ADDRESSES: Address comments on the AGENCY: Department of Energy. and NYSERDA, under SEQRA, plan to ACTION: Notice of Intent. scope of the Decommissioning and/or Long-Term Stewardship EIS to the DOE evaluate the range of reasonable alternatives in this EIS to address their SUMMARY: The U.S. Department of Document Manager: Mr. Daniel W. respective responsibilities at the Center, Energy (DOE) and the New York State Sullivan, West Valley Demonstration including those under the WVDP Act, Energy Research and Development Project, U.S. Department of Energy, Atomic Energy Act of 1954 (as Authority (NYSERDA) are announcing WV–49, 10282 Rock Springs Road, West amended), and all other applicable their intent to prepare an Environmental Valley, New York 14171, Telephone: Federal and State statutes. Impact Statement (EIS) for (800) 633–5280, Facsimile: (716) 942– Decommissioning and/or Long-Term 4199, E-mail: [email protected]. Background Stewardship at the West Valley The ‘‘Public Reading Rooms’’ section The Western New York Nuclear Demonstration Project (WVDP) and under SUPPLEMENTARY INFORMATION lists Service Center consists of a 3,345-acre Western New York Nuclear Service the addresses of the reading rooms reservation in rural western New York Center (also known as the ‘‘Center’’). where documents referenced herein are that is the location of the only NRC- The U.S. Nuclear Regulatory available. licensed commercial spent nuclear fuel Commission (NRC), the U.S. FOR FURTHER INFORMATION, CONTACT: For reprocessing facility to have ever Environmental Protection Agency information regarding the WVDP or the operated in the United States. (EPA), and the New York State EIS, contact Mr. Daniel Sullivan as Reprocessing operations resulted in the Department of Environmental described above. Those seeking general generation of approximately 600,000 Conservation (NYSDEC) will participate information on DOE’s NEPA process gallons of liquid high-level waste as cooperating agencies under the should contact: Ms. Carol M. Borgstrom, (HLW), which was stored in large National Environmental Policy Act (EH–42), Director, Office of NEPA underground tanks adjacent to the (NEPA, 42 U.S.C. 4321 et seq.). In Policy and Compliance, U.S. reprocessing facility. NYSERDA holds addition, NYSDEC will participate as an Department of Energy, 1000 title to the Center on behalf of the involved agency under the New York Independence Avenue, SW., people of the State of New York. (See H. State Environmental Quality Review Act Washington, DC 20585, Telephone: Rep. No. 96–1000 at 4 (1980) reprinted (SEQRA) with respect to NYSERDA’s (202) 586–4600, Facsimile: (202) 586– in 1980 U.S.S.C.A.N 3102, 3103.) proposed actions. DOE, under NEPA, 7031, or leave a message at 1–800–472– The WVDP Act of 1980 required DOE and NYSERDA, under SEQRA, plan to 2756, toll-free. to solidify the HLW, transport it to a evaluate the range of reasonable Questions for NYSERDA should be Federal geologic repository, dispose of alternatives in this EIS to address their directed to: Mr. Paul J. Bembia, New the low-level waste (LLW) and respective responsibilities at the Center, York State Energy Research and transuranic (TRU) waste generated from including those under the West Valley Development Authority, 10282 Rock Project activities, and decontaminate Demonstration Project Act (Pub. L. 96– Springs Road, West Valley, New York and decommission the facilities used for 368), Atomic Energy Act of 1954 (as 14171, Telephone: (716) 942–4900, the Project. The Act also authorized amended), and all other applicable Facsimile: (716) 942–2148, E-mail: NRC to prescribe decommissioning Federal and State statutes. [email protected]. criteria for the WVDP. The NRC has This EIS will revise the Draft Those seeking general information on placed NYSERDA’s NRC site license in Environmental Impact Statement for the SEQRA process should contact: Mr. abeyance during DOE’s fulfillment of its Completion of the West Valley Hal Brodie, Deputy Counsel, New York WVDP Act requirements. Demonstration Project and Closure or State Energy Research and Development Pursuant to the WVDP Act, on Long-Term Management of Facilities at Authority, 17 Columbia Circle, Albany, October 1, 1980, DOE and NYSERDA the Western New York Nuclear Service New York 12203–6399, Telephone: entered into a Cooperative Agreement Center (DOE/EIS–0226–D, January 1996, (518) 862–1090, ext. 3280, Facsimile: (amended September 19, 1981) that also referred to as the 1996 Cleanup and (518) 862–1091, E-mail: established a framework for the Closure Draft EIS). Based on [email protected]. implementation of the Project. Under decommissioning criteria for the WVDP This Notice of Intent will be available the agreement, NYSERDA has made issued by NRC since the Cleanup and on the internet at http://tis.eh.doe.gov/ available to DOE, without transfer of Closure EIS was published, DOE and nepa, under ‘‘What’s New.’’ Additional title, an approximately 200-acre portion NYSERDA propose to evaluate five information about the WVDP is also of the Center, known as the ‘‘Project alternatives: Unrestricted Site Release, available on the internet at http:// Premises,’’ which includes a formerly Partial Site Release without Restrictions, www.wv.doe.gov/linkingpages/ operated spent nuclear fuel reprocessing Partial Site Release with Restrictions, insidewestvalley.htm. plant, spent nuclear fuel receiving and

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storage area, underground liquid HLW term stewardship EIS, would analyze material or structures for which it is storage tanks, and a liquid LLW various decommissioning and/or long- responsible will remain on site, and treatment facility with associated term stewardship alternatives and what, if any, institutional controls, lagoons, as well as other facilities. Most would include decontamination as well. engineered barriers, or stewardship of the facilities on the Project premises It would also include the management provisions would be needed. It is were radioactively contaminated from of wastes generated by NYSERDA’s intent to pursue reprocessing operations and are located decommissioning and/or long-term termination of the existing 10 CFR Part on a geographic area of the Center stewardship actions. Because this 50 license for the Western New York known as the North Plateau. Among the second EIS addresses strategies that may Nuclear Service Center (currently held other facilities located within the be used to complete the WVDP and in abeyance) upon DOE’s completion of Project Premises is a radioactive waste disposition the Center, DOE now decontamination and decommissioning disposal area known as the NRC- intends that this EIS would replace the under the WVDP Act in accordance licensed disposal area (NDA). Adjacent 1996 Cleanup and Closure EIS. (DOE with criteria prescribed by the NRC. to the Project Premises is a radioactive issued an Advance Notice of Intent NYSERDA plans to use the analysis of waste disposal area known as the State inviting preliminary public input to the alternatives in the Decommissioning Licensed Disposal Area (SDA) for which scope of this EIS on November 6, 2001 and/or Long-Term Stewardship EIS to NYSERDA has operational [66 FR 56090].) support any necessary NRC or NYSDEC responsibility. Both the NDA and SDA On February 1, 2002, the NRC license or permit applications. are located on the South Plateau published in the Federal Register (67 Areas of Disagreement With Respect to geographic area of the Center. FR 5003) its Decommissioning Criteria In 1987, DOE agreed, in a Stipulation for the West Valley Demonstration Responsibilities of Compromise settling a lawsuit filed Project (M–32) at the West Valley Site; DOE and NYSERDA currently do not by local citizens, to evaluate the Final Policy Statement. The NRC agree on their respective feasibility of onsite disposal of LLW decided that it would apply its License responsibilities, including whether DOE generated as a result of Project activities Termination Rule (10 CFR 20, Subpart is required under the WVDP Act to in a Cleanup and Closure EIS, and to E) as the decommissioning criteria for remediate the North Plateau initiate the EIS process by the end of the WVDP and the decommissioning groundwater plume and decommission calendar year 1988. DOE and NYSERDA goal for the entire NRC-licensed site. the NDA, and which party is jointly issued the resulting Draft EIS for The NRC intends to use this West Valley responsible for any long-term Completion of the West Valley EIS to evaluate the environmental stewardship following the Demonstration Project and Closure or impacts of the various alternatives decommissioning actions required Long-Term Management of Facilities at before deciding whether to accept the under the WVDP Act. the Western New York Nuclear Service preferred alternative as meeting the In accordance with their respective Center (DOE/EIS–0226-D, also known as criteria permitted by the License applicable legal requirements, DOE and the ‘‘Cleanup and Closure EIS’’) in 1996. Termination Rule. NYSERDA each have unilateral The Cleanup and Closure draft EIS decision-making authority for those Purpose and Need for Action evaluated a range of alternatives that actions for which they are responsible. included a broad scope of waste DOE is required by the WVDP Act to DOE will determine the manner in management and decontamination/ decontaminate and decommission the which it will decommission Project decommissioning activities. However, tanks and facilities used in the facilities as required under the WVDP the draft EIS did not identify a preferred solidification of the HLW, and any Act. NYSERDA will determine the alternative. material and hardware used in manner in which non-Project facilities, In 2001, DOE revised its NEPA connection with the WVDP, in not required to be decommissioned strategy to continue its EIS process in accordance with such requirements as under the WVDP Act, will be managed. order to complete its obligations under the NRC may prescribe. The NRC has Potential Range of Alternatives the WVDP Act. DOE announced that it prescribed its License Termination Rule would prepare a separate EIS to address as the decommissioning criteria for the DOE and NYSERDA intend to use the decontamination and near-term waste WVDP. Therefore, DOE needs to NRC’s License Termination Rule and management activities for which it is determine the manner that facilities, associated guidance provided in the solely responsible under the Act (66 FR materials, and hardware for which the NRC’s Final Policy Statement as the 16647, March 26, 2001). In addition, Department is responsible are managed framework to evaluate possible DOE and NYSERDA would jointly or decommissioned, in accordance with alternatives for decommissioning and/or prepare a second EIS for applicable Federal and State long-term stewardship actions involving decommissioning and/or long-term requirements. To this end, DOE needs to WVDP facilities, as well as stewardship to address activities for determine what, if any, material or decommissioning and/or long-term which each party is responsible. After structures for which it is responsible stewardship actions involving considering public comments on the will remain on site, and what, if any, NYSERDA-controlled facilities and March 26, 2001, NOI and new institutional controls, engineered areas on the Center. In the Final Policy information identified under ‘‘New barriers, or stewardship provisions Statement, the NRC recognized that it Information to be Evaluated’’ below, would be needed. does not have the regulatory authority to DOE believes the scopes of both EISs NYSERDA needs to determine the apply the License Termination Rule to should be further modified as follows. manner that facilities and property for the SDA, and said that a cooperative The first EIS, the West Valley Waste which NYSERDA is responsible, approach with the State will be utilized Management EIS, would address actions including the State-Licensed Disposal to the extent practical to apply the pertaining to waste accumulated in Area, will be managed or License Termination Rule in a storage on site as a result of past Project decommissioned, in accordance with coordinated manner. activities as well as waste to be applicable Federal and State As required by NEPA, the EIS will generated in the near term. The second requirements. To this end, NYSERDA present the environmental impacts EIS, this decommissioning and/or long- needs to determine what, if any, associated with the range of reasonable

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alternatives to meet DOE’s and for the North Plateau. Appropriate Waste Management EIS. No NYSERDA’s purposes and needs for infiltration controls would be evaluated decommissioning decisions would be action, and a no-action alternative. This for the NDA and the SDA. The NDA and made nor actions taken to make progress range encompasses release of the Center SDA on the South Plateau would not be toward decommissioning, including for re-use under unrestricted and released but would be managed, decontamination beyond the scope that restricted conditions as allowed under monitored, and maintained under DOE is currently performing. No the License Termination Rule. The EIS permit, license, or other appropriate facilities would be closed in place, but will present the health and regulatory oversight. With the exception would be left in their current environmental consequences of the of the NDA and SDA, the WVDP Project configuration and actively monitored alternatives in comparable form to Premises and Center could be released and maintained as required by existing provide a clear basis for informed without restrictions. DOE and regulations to protect public, worker, decision making. DOE’s and NYSERDA also intend to evaluate the and environmental health and safety. NYSERDA’s preferred alternative will need for new onsite interim waste When required, remedial actions would be identified in the Draft EIS. This Draft storage that may be required to support be taken in response to any releases of EIS will also include an evaluation of timely completion of this alternative. contamination into the environment whether the alternatives would meet the that may present a health and safety Alternative 3—Partial Site Release with NRC decommissioning criteria and risk, such as would be experienced from Restrictions other applicable requirements. the eventual failure of the underground DOE and NYSERDA intend to HLW storage tanks. Under this Alternative 1—Unrestricted Site Release evaluate an alternative that may permit alternative, no portion of the Project DOE and NYSERDA intend to release with restrictions of portions of Premises or the Center would be evaluate an alternative that could satisfy the North Plateau geographic area and released for any present or future use. the License Termination Rule criteria the balance of the 3,345-acre Center, and permit termination of NYSERDA’s with the exception of the NDA and Alternative 5—No Action (Walk Away) NRC license without restrictions. DOE SDA. DOE and NYSERDA are proposing This alternative involves the cessation and NYSERDA are proposing that this that this alternative involve removal of of all management and oversight of the alternative involve removal of WVDP wastes and structures to the extent Center and all facilities located upon the and non-WVDP wastes, structures, and technically and economically practical Center property, including the WVDP, contaminated soils to the extent so that the radiological criteria specified immediately after implementation of required so that the radiological criteria in 10 CFR 20.1403 can be met for the DOE’s Record of Decision for the WVDP specified in 10 CFR 20.1402 can be met North Plateau. This would involve in- Waste Management EIS. The Process for Project and non-Project facilities and place closure of the Process Building, Building, Waste Tank Farm, the balance of the 3,345-acre Center. Vitrification Facility, HLW Tank Farm, Vitrification Facility, North Plateau This alternative includes exhumation wastewater treatment facility lagoons, groundwater plume, NDA, SDA, and and offsite disposal of waste and and the North Plateau contaminated other smaller facilities would remain contaminated soils from the NDA and groundwater plume in a manner that is and would not be monitored or SDA on the South Plateau. protective of public health, safety, and maintained. Unmitigated natural DOE and NYSERDA intend to the environment. Other ancillary North processes, including erosion, evaluate the need for new onsite interim Plateau facilities would be removed. groundwater transport of contamination, waste storage capacity under Alternative Appropriate infiltration controls would and concrete degradation, would be 1 for some waste types, such as Greater- be evaluated for the NDA and the SDA. assumed to occur. The purpose of Than-Class C waste, that may not be The application of institutional controls evaluating this alternative is to establish able to be disposed of in a time frame and engineered barriers would be the basis against which the that would support timely required and evaluated. The NDA and environmental impacts from all other implementation of this EIS alternative. SDA on the South Plateau would not be decommissioning and/or long-term Such an interim storage facility would released but would be managed, stewardship alternatives are compared. remain under institutional control until monitored, and maintained under Alternatives Considered But Eliminated the waste it contains is removed from permit, license, or other appropriate From Further Evaluation the site. Following implementation of regulatory oversight. With the exception this alternative, including removal of of the NDA and SDA, the end state DOE does not consider the use of any wastes in interim storage, the Center would be the release of the WVDP existing structures or construction of could be released without restrictions. Project Premises and Center under new aboveground facilities at the WVDP restricted conditions. However, for indefinite storage of Project and non- Alternative 2—Partial Site Release unimpacted and/or remediated areas of Project LLW and mixed low-level waste without Restrictions the Center could be considered for (MLLW) to be a reasonable alternative DOE and NYSERDA intend to release without restrictions. DOE also for further consideration. Under the evaluate an alternative that could satisfy intends to evaluate the need for new Waste Management Programmatic the radiological criteria specified in 10 onsite interim HLW storage that may be Environmental Impact Statement CFR 20.1402 for facilities and areas on required to support timely completion (WMPEIS, DOE/EIS–0200–F) Record of the North Plateau geographic area of the of this alternative. Decision, DOE decided that sites such as Center, including the North Plateau the WVDP would ship their LLW and groundwater plume, as well as the Alternative 4—Monitor and Maintain MLLW to other DOE sites that have balance of the 3,345-acre Center, with under Current Operations disposal capabilities for these wastes. the exception of the NDA and SDA. This This alternative involves the (This decision did not preclude the use would include removal of WVDP and continued management and oversight of of commercial disposal facilities as non-WVDP wastes, structures, and the Center and all facilities located upon well.) The construction, subsequent contaminated soils to the extent the Center property, including the maintenance, and periodic replacement required so that the radiological criteria WVDP, after DOE’s implementation of over time of new facilities for indefinite specified in 10 CFR 20.1402 can be met its Record of Decision for the WVDP onsite waste storage at West Valley

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would be impractical from a cost, knowledge about the regional structural • The influence of, and potential programmatic, health, and geology as it may relate to the WVDP interactions of, any wastes remaining at environmental standpoint. Thus, given and the Center. the Center after decommissioning. the capacity to safely and permanently Additional information that has • Unavoidable adverse impacts. disposition LLW and MLLW in become available since publication of • Issues associated with long-term available off site facilities, DOE would the 1996 Draft Cleanup and Closure EIS site stewardship, including regulatory not consider indefinite onsite waste includes DOE’s WM PEIS and its and engineering considerations, storage in new or existing facilities to be associated Records of Decision. The WM institutional controls, and land use a viable waste management alternative PEIS analyzed on a national scale the restrictions, including the need for for its decommissioning actions at the centralization, regionalization, or buffer areas. • WVDP. For similar reasons, NYSERDA decentralization of managing HLW, Long-term health and would use available commercial transuranic waste, low-level radioactive environmental impacts, including facilities for disposal of any non-Project waste, mixed radioactive low-level potential impacts on groundwater LLW and MLLW that it may generate, in waste (containing hazardous quality. • lieu of incurring the costs of new constituents), and non-wastewater Long-term site stability, including construction. hazardous waste. erosion and seismicity. • Waste Incidental to Reprocessing. New Information To Be Evaluated Potential Environmental Issues for • Disposition of wastes generated as a As discussed above, the NRC Analysis result of decommissioning and/or long- published its Final Policy Statement DOE has tentatively identified the term stewardship activities. prescribing decommissioning criteria for following issues for analysis in the Other Agency Involvement the WVDP on February 1, 2002, stating Decommissioning and/or Long-Term Nuclear Regulatory Commission: NRC that NRC intends to apply its License Stewardship EIS. The list is presented to has the regulatory responsibility under Termination Rule (10 CFR 20.1401 et facilitate early comment on the scope of the Atomic Energy Act for the Center, seq.) as decommissioning criteria in the EIS. It is not intended to be all- which is the subject of the NRC license assessing the health and environmental inclusive nor to predetermine the issued to NYSERDA pursuant to 10 CFR impacts of decommissioning the WVDP alternatives to be analyzed or their part 50, with the exception of the SDA. facilities. DOE and NYSERDA will potential impacts. The NRC license is currently in utilize the NRC’s Final Policy Statement • Potential impacts to the general and the License Termination Rule as the abeyance pending completion of the population and on-site workers from WVDP. benchmark to develop and analyze their radiological and non-radiological decommissioning alternatives in the The WVDP Act specifies certain releases from decommissioning and/or responsibilities for NRC, including: (1) Decommissioning and/or Long-Term long-term stewardship activities. Stewardship EIS. • Prescribing requirements for For the 1996 Draft Cleanup and Potential environmental impacts, decontamination and decommissioning; Closure EIS, DOE and NYSERDA including air and water quality impacts, (2) providing review and consultation to developed or modified a variety of caused by decommissioning and/or DOE on the Project; and (3) monitoring long-term stewardship activities. analytical tools specifically for that • the activities under the Project for the document. DOE has continued to refine Potential transportation impacts purpose of assuring the public health many of these analytical tools as a result from shipments of radioactive, and safety. NRC will participate as a of public comments received on the hazardous, mixed, and clean waste cooperating agency under NEPA on the 1996 Draft Cleanup and Closure EIS and generated during decommissioning West Valley Decommissioning and/or ongoing interactions with stakeholders activities. Long-Term Stewardship EIS. NRC may • and regulatory agencies such as the Potential impacts from postulated adopt this EIS for determining that the NRC. DOE and NYSERDA intend to accidents. preferred alternative meets NRC’s • apply these improved analytical tools to Potential costs for implementation decommissioning criteria, assuming that the preparation of the Decommissioning and long-term stewardship of NRC will find the preferred alternative and/or Long-Term Stewardship EIS. To alternatives considered. acceptable. address significant issues such as • Potential disproportionately high Notwithstanding the WVDP, NRC erosion, for example, DOE and and adverse effects on low-income and retains the regulatory responsibility for NYSERDA have developed a site- minority populations (environmental the non-DOE activity in the non-Project specific erosion model, with ongoing justice). area and non-SDA area to the extent that advice from NRC, and integrated that • Potential Native American contamination exists both on and offsite model into a revised performance concerns. resulting from activities performed assessment methodology, incorporating • Irretrievable and irreversible when the facility was operating under the use of sensitivity and uncertainty commitment of resources. its NRC 10 CFR part 50 license. analyses. • Short-term and long-term land use Following completion of the WVDP and There are also some additional areas impacts. reinstatement of the license, NRC will where new information has or will be • Ability of alternatives to meet the have the regulatory responsibility for obtained specifically for the Comprehensive Environmental authorizing termination of the license, Decommissioning and/or Long-Term Response, Compensation and Liability should NYSERDA seek license Stewardship EIS. This work includes Act risk range. termination. updated site characterization and • Ability of alternatives to satisfy United States Environmental census data and the performance of a WVDP decommissioning criteria. Protection Agency: The United States seismic reflection survey in the vicinity • Compliance with applicable Environmental Protection Agency of the Center. This seismic reflection Federal, State, and local requirements. (USEPA) will participate as a survey, performed in consultation with • Identification of Derived cooperating agency under NEPA on the academic, government, and industry Concentration Guideline Limits, where West Valley Decommissioning and/or participants, will contribute to appropriate. Long-Term Stewardship EIS. As a

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cooperating agency, EPA will review the the public meeting should be made by Library of the Town of Concord, 18 EIS and other documents developed by calling or writing the DOE Document Chapel Street, Springville, New York DOE in conjunction with NYSERDA to Manager (see ADDRESSES, above). 14141, (716) 592–7742; West Valley provide early input on the analyses of Speakers will be scheduled on a first- Central School Library, 5359 School environmental impacts associated with come, first-served basis. Individuals Street, West Valley, New York 14141, the decommissioning alternatives to be may sign up at the door to speak and (716) 942–3261; Ashford Office analyzed. will be accommodated as time permits. Complex, 9030 Route 219, West Valley, New York State Department of Written comments will also be accepted New York 14171, (716) 942–4555. Environmental Conservation: With at the meeting. Speakers are encouraged Issued in Washington, DC on March 7, respect to DOE proposed actions, to provide written versions of their oral 2003. NYSDEC will participate as a comments for the record. Beverly A. Cook, cooperating agency under NEPA on the The meetings will be facilitated by a Assistant Secretary, Environment, Safety and West Valley Decommissioning and/or moderator. Time will be provided for Health. Long-Term Stewardship EIS. As a meeting attendees to ask clarifying [FR Doc. 03–6055 Filed 3–12–03; 8:45 am] cooperating agency, NYSDEC will questions. Individuals requesting to review the EIS and other documents speak on behalf of an organization must BILLING CODE 6450–01–P developed by DOE in conjunction with identify the organization. Each speaker NYSERDA to provide early input on the will be allowed five minutes to present DEPARTMENT OF ENERGY analyses of environmental impacts comments unless more time is requested associated with the decommissioning and available. Comments will be Bonneville Power Administration alternatives to be analyzed, and as part recorded by a court reporter and will of their regulatory responsibilities. become part of the scoping meeting [BPA File No: SN–03] NYSDEC will participate as an involved record. Bonneville Power Administration’s agency under SEQRA with respect to These two public scoping meetings Proposed Safety-Net Cost Recovery NYSERDA’s proposed actions. will be held during a public scoping Adjustment Clause Adjustment to 2002 NYSDEC regulates the SDA through comment period. The comment period Wholesale Power Rates issuance of permits under 6 New York begins with publication of this NOI and Codes, Rules and Regulations (NYCRR) will formally close on April 28, 2003. AGENCY: Bonneville Power Part 380 Rules and Regulations for Comments received after this date will Administration, Department of Energy. Prevention and Control of be considered to the extent practical. ACTION: Notice of proposed safety-net Environmental Pollution by Radioactive Comments provided during scoping will cost recovery adjustment clause: public Materials. NYSDEC also regulates be addressed in the revised draft hearing, and opportunity for public hazardous and mixed waste at the Decommissioning and/or Long-Term review and comment. Center pursuant to 6 NYCRR Part 370 Stewardship EIS. Written comments Series. This includes permitting will be received during the scoping SUMMARY: The Pacific Northwest activities under Interim Status for RCRA period either in writing, by facsimile, or Electric Power Planning and regulated units and Corrective Action by email to Mr. Daniel Sullivan, DOE Conservation Act (Northwest Power Requirements for investigation and if Document Manager (see ADDRESSES, Act), 16 U.S.C. 839, provides that the necessary, remediation of hazardous above, for contact information). Bonneville Power Administration (BPA) constituents from Solid Waste must establish and periodically review Management Units. Schedule and revise its rates to recover, in NYSDEC is also responsible for The DOE intends to issue the draft accordance with sound business ensuring compliance with the 1992 joint Decommissioning and/or Long-Term principles, the costs associated with the NYSDEC/USEPA 3008 (h) [New York Stewardship EIS as early as December acquisition, conservation, and State Environmental Conservation Law, 2003. A public comment period of up to transmission of electric power, and to Article 27, Titles 9 and 13] Order issued 180 days will start upon publication of recover the Federal investment in the to the DOE and NYSERDA. The Order the EPA’s Federal Register Notice of Federal Columbia River Power System required investigation of solid waste Availability. DOE will consider and (FCRPS) and other costs incurred by management units, performance of respond to comments received on the BPA. interim corrective measures, and draft Decommissioning and/or Long- On February 7, 2003, the BPA completion of Corrective Measures Term Stewardship EIS in preparing the Administrator determined that the Studies, if necessary. NYSDEC and EPA final EIS. Safety-Net Cost Recovery Adjustment intend to accommodate the DOE’s and Comments received during the 1989 Clause (SN CRAC) triggered based upon NYSERDA’s efforts to coordinate and scoping process and from the public a forecast of a 50 percent or greater integrate the EIS process pursuant to the comment period on the 1996 Cleanup chance of missing a payment to the U.S. Order. and Closure EIS (DOE/EIS–0226-D) will Treasury or another creditor during this be considered in the Decommissioning fiscal year. The triggering of the SN Public Scoping Meetings and/or Long-Term Stewardship EIS. CRAC initiates an expedited hearing DOE and NYSERDA will hold two under section 7(i) of the Northwest public scoping meetings on the Public Reading Rooms Power Act, 16 U.S.C. 839e(a)(1). By this Decommissioning and/or Long-Term Documents referenced in this Notice notice, BPA announces a proposed SN Stewardship EIS at the Ashford Office of Intent and related information are CRAC adjustment to BPA’s Wholesale Complex, located at 9030 Route 219 in available at the following locations: Power Rates for FY 2002–2006, which the Town of Ashford, NY, from 7 to 9:30 Central Buffalo Public Library Science the Federal Energy Regulatory p.m. on April 9 and April 10, 2003. The and Technology Department, Lafayette Commission (FERC) approved on an purpose of scoping is to encourage Square, Buffalo, New York 14203, (716) interim basis on September 28, 2001. public involvement and solicit public 858–7098; The Olean Public Library, U. S. Department of Energy—Bonneville comments on the proposed scope and 134 North 2nd Street, Olean, New York Power Admin., 96 F.E.R.C. ¶ 61,360 content of the EIS. Requests to speak at 14760, (716) 372–0200; The Hulbert (2001).

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DATES: Proposed hearing dates are Act, 16 U.S.C. 838, and the Northwest Prehearing/BPA Direct Case: March supplied in SUPPLEMENTARY Power Act, 16 U.S.C. 839. 31. INFORMATION, Section I.A. below. BPA’s rates must be established to Clarification: April 2. The period for public comment period recover BPA’s costs. In particular, Motions to Strike: April 4. closes on May 1, 2003. section 7(a)(1), 16 U.S.C. 839e(a)(1), Data Request Deadline: April 4. ADDRESSES: Written comments should provides in part that: Answers to Motions to Strike: April be submitted to: Bonneville Power 10. [s]uch rates shall be established and, as Data Response Deadline: April 10. Administration, P.O. Box 12999, appropriate, revised to recover, in accordance Portland, Oregon 97212. Comments can with sound business principles, the costs Field Hearing: April 16. Parties file Direct Cases: April 17. also be sent electronically to: associated with the acquisition, conservation, Clarification: April 21. [email protected]. The documents and transmission of electric power, including the amortization of the Federal investment in Motions to Strike: April 22. will be available for public viewing after Data Request Deadline: April 22. March 31, 2003. The documents are the Federal Columbia River Power System (including irrigation costs required to be Answers to Motions to Strike: April available at: http://www.bpa.gov/power/ repaid out of power revenues) over a 28. psp/rates/RateCases/sn03/, or in BPA’s reasonable period of years and the other costs Data Response Deadline: April 28. Public Information Center, BPA and expenses incurred by the Administrator Close of Participant Comments: May Headquarters Building, 1st Floor; 905 pursuant to this Act and other provisions of 1. NE. 11th, Portland, Oregon, and will be law. Litigants file Rebuttal: May 2. provided to parties at the prehearing Section 7(i) of the Northwest Power Clarification: May 5. conference to be held on March 31, Act, 16 U.S.C. 839e(i), requires that Motions to Strike: May 7. 2003, from 9 a.m. to 12 p.m., Room 223, BPA’s rates be established according to Data Request Deadline: May 7. 911 NE. 11th, Portland, Oregon. Mr. certain procedures. These procedures Answers to Motions to Strike: May 13. Data Response Deadline: May 13. Byron G. Keep, Power Products, Pricing include, among other things, and Rates Manager, is the official Cross-Examination: May 15–16. publication of notice of the proposed Initial Briefs Filed: May 20. responsible for the development of rates in the Federal Register; one or BPA’s power rates. Oral Argument: May 23. more hearings conducted as Draft ROD issued: June 12. FOR FURTHER INFORMATION CONTACT: expeditiously as practicable by a Briefs on Exceptions: June 17. Interested persons may call Cynthia Hearing Officer; public opportunity for Final ROD—Final Studies: June 30. Jones at (503) 230–5459 or Cain Bloomer both oral presentation and written BPA will conduct a public field at (503) 230–7443. submission of views, data, questions, hearing on April 16, 2003, in Portland, SUPPLEMENTARY INFORMATION: and argument related to the proposed Oregon. The public field hearing will Table of Contents rates; cross-examination; and a decision provide an opportunity for persons who by the Administrator based on the are not parties in the formal rate hearing Part I: Introduction and Procedural Background record. This proceeding is governed by to have their views included in the A. Relevant Statutory Provisions Governing section 1010.9 of BPA’s Procedures official record. Written transcripts will This Rate Proceeding Governing Bonneville Power be made of the field hearing. The field B. Background Administration Rate Hearings, 51 FR hearing is scheduled to begin at 6 p.m. Part II: Purpose and Scope of Proceeding 7611 (1986) (Procedures). The Confirmation of this hearing date and A. Purpose of Proceeding Procedures implement the statutory the specific location will be announced B. Scope of Proceeding section 7(i) requirements. Section on BPA’s Web site at: http:// 1. Other Proceedings 1010.7 of the Procedures prohibits ex www.bpa.gov/power/psp/rates/ a. Power Business Line WP–02 Rate Case b. Transmission Business Line TR–04 Rate parte communications. Special rules RateCases/sn03/index.shtml and Proceeding governing the rate proceeding may also through public advertising, or interested 2. Financial Choices and Spending Levels be adopted at the prehearing conference. persons may call the telephone numbers 3. Fish and Wildlife Costs and Hydro Documents will be filed and served listed in above the FOR FURTHER Operations electronically under procedures to be INFORMATION CONTACT section of this C. National Environmental Policy Act established by the Hearing Officer at the Notice. Part III: Public Participation prehearing conference. A. Distinguishing Between ‘‘Participants’’ BPA’s proposed SN CRAC adjustment B. Background and ‘‘Parties’’ is published in Part V. below. The study In May 2000, BPA completed its B. Developing the Record Part IV: BPA’s Proposed Solution to the Cost addressing the factors used to develop analysis and final proposal for FY 2002– Recovery Problem the SN CRAC adjustment is summarized 2006 rates. On July 6, 2000, pursuant to A. Introduction in Part IV. section 7(a)(2) of the Northwest Power B. Safety-Net Cost Recovery Adjustment BPA will release its 2003 initial SN Act, 16 U.S.C. section 839e(a)(2), BPA’s Clause Design CRAC rate proposal on March 31, 2003, Power Business Line (PBL) filed its C. BPA’s Proposal and expects to publish a final Record of proposed wholesale power rates with D. Summary of Supporting Study Decision (ROD) on June 30, 2003. BPA the Federal Energy Regulatory Part V: The Amended 2002 GRSPs will conduct a formal evidentiary rate Commission (FERC). On August 4, 2000, Part I—Introduction and Procedural hearing for parties. Entities interested in BPA filed a motion with FERC Background becoming parties to this proceeding requesting that FERC stay the must file petitions to intervene in order proceeding for 30 days. After requesting A. Relevant Statutory Provisions to participate in the formal hearing. (See the stay, BPA reviewed the impact of Governing This Rate Proceeding Part III. for further details on becoming the unexpected price increases in the Guidance regarding BPA ratemaking a party.) A proposed schedule for the wholesale power markets on the West is provided by the Bonneville Project formal hearing is set forth below. A final Coast and their effect on PBL’s power Act, 16 U.S.C. 832, the Flood Control schedule will be established by the rate proposal. Act of 1944, 16 U.S.C. 825s, the Federal Hearing Officer at the prehearing BPA concluded that, in light of the Columbia River Transmission System conference. unprecedented price spikes during the

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summer of 2000, PBL’s proposed cost- creditor is 50 percent or greater despite benefits to residential and small farm based rates for FY 2002–2006 would be the implementation of the LB and FB customers of investor-owned utilities. far more attractive to customers than CRACs. On September 28, 2001, FERC Faced with a deterioration of its market alternatives, and, in fact, public granted interim approval of BPA’s rate overall financial condition, BPA sent a utility customers requested purchase filing, U.S. Department of Energy— letter to rate case parties and other contracts for significantly more power Bonneville Power Admin., 96 FERC interested entities in the region on July than forecasted in the BPA’s May 2000 ¶ 61,360 (2001). 2, 2002, announcing the beginning of final rate proposal. This resulted in total The forecasts included in the the Financial Choices public comment load obligations of about 3,200 aMW Supplemental Rate Proposal, and process. The Financial Choices process more than the existing system could reflected in the TPP forecast, included examined a variety of financial and supply. two sources of revenue that would cover program options for addressing PBL’s After a public comment period, BPA expense increases. The first revenue FY 2003–2006 financial challenges. In notified rate case parties on October 6, source was secondary sales from high this process, BPA described those 2000, that it intended to initiate a market prices. Market prices were financial challenges, the actions BPA limited 7(i) proceeding to address forecast to stay high through 2003 already had taken to address the increased load obligations and high because the development of electrical problem, and the financial outlook for market prices. On December 1, 2000, infrastructure was expected to take up the remainder of the rate period. BPA announced its proposed to two years of development to catch up Additionally, BPA identified a variety of amendments to the 2002 wholesale with the high demand that BPA and the potential financial alternatives that, power rate adjustment proposal. west coast was experiencing. Therefore, separately or in combination, could Proposed Amendments to 2002 the initial two years of the rate period form the basis of a solution to PBL’s Wholesale Power Rate Adjustment were expected to be supply-limited. The financial situation. Proposal, 65 FR 75272 (2000) (Amended second revenue source was also tied to During the course of the process, BPA Proposal). BPA filed an Amended these high market prices. Credits toward held ten public meetings and workshops Proposal rather than formally modifying BPA’s Treasury payments based on fish- with customers, public interest groups, the original rate proposal for two main related costs (fish credits) and impacts tribes, and other interested persons to reasons. First, rates needed to be in on operations were expected to explain the nature of the problem, and place by October 2001 and there was no contribute significantly to total revenues to show program level costs and the assurance a full rate proceeding could through high market prices. These fish potential effects of cost reductions. BPA have been conducted within the time credits contribute to BPA’s overall also solicited suggestions to address its remaining. Second, the Treasury revenues through a credit against BPA’s growing financial problem. The public payment analysis showed that payment to the U.S. Treasury. When comment period closed on September secondary revenues, even with very market prices are higher, the size of the 30, 2002. As a result of the Financial conservative assumptions relative to the credit available to BPA may increase. Choices process, BPA made decisions to actual forward market, would very BPA’s June 2001 forecasts for secondary cut, eliminate, or defer certain costs and likely cover any cost overruns. energy prices and available credits expenses. BPA issued a Financial After BPA released its Amended during the rate period proved to be Choices close-out letter to the region on Proposal, the forecast for starting rate inaccurate when market prices dropped November 22, 2002, outlining BPA’s period reserves dropped substantially. faster and to lower levels than plan, in part, for meeting the PBL’s In addition, market prices rose forecasted. This resulted in lower-than- financial challenges. The plan takes into significantly from BPA’s December 2000 forecasted revenues for BPA in fiscal consideration extensive public input forecast. These rapid developments year 2002. Hydro production during FY BPA received during the Financial necessitated significant changes to the 2002–2003 also has been well below Choices public process. The actions Amended Proposal. BPA began forecasts. The lingering effects of the BPA has taken, and will take, as settlement discussions with rate case 2001 drought on FY 2002 and the poor described in the Financial Choices parties to attempt to forge a resolution hydro conditions in 2003 have close-out letter, include the to the matter. When BPA and many of contributed to the significant decline in identification of $350 million in the rate case parties reached a Partial BPA’s revenues. Although the hydro expense savings, expense deferrals, and Settlement Agreement, BPA filed a conditions appeared to be about normal other actions for the FY 2003–2006 Supplemental Proposal reflecting the over the January-July 2002 period, BPA period. These will be reflected in the terms of the Partial Settlement stored a significant amount of water to program levels in BPA’s Initial Proposal. Agreement. The Partial Settlement replenish the low reservoirs resulting An additional $500 million of other Agreement included three separate Cost from the 2001 drought. This need for potential savings and deferrals are being Recovery Adjustment Clauses, allowing storage resulted in less 2002 hydro pursued, but are uncertain since they the adoption of a general approach to production than was forecast. largely involve actions by other parties keep base rates low and deal with In addition, both operating and non- in the region. financial shortfalls though the CRACs operating cost increases, relative to the While BPA did not trigger the SN rather than raise base rates. These tools levels assumed in the rates that BPA CRAC in November, by January 2003, gave BPA the risk mitigation necessary filed with FERC, have contributed to worsening water conditions and a to have a sufficiently high Treasury BPA’s eroding financial condition. refined secondary revenue forecast Payment Probability (TPP). The three These increases include: BPA internal increased the net revenue gap for the CRACs are the Load-Based (LB) CRAC operating costs; hydro system costs; 2002–2006 rate period to $950 million. which is designed to cover Federal debt service, net interest In February 2003, the Administrator augmentation costs, the Financial-Based expense and depreciation; Columbia determined that BPA had lower than a (FB) CRAC which is designed to cover Generating Station costs; Direct Service 50 percent probability of making its net revenue, and the Safety-Net (SN) Industries, California Independent Treasury payment in September 2003. CRAC which is available if the System Operator and California Power An SN CRAC adjustment became likelihood of missing a Treasury Exchange bad debt expenses; necessary to ensure that rates and payment or payment to any other conservation costs; and an increase in revenues will be sufficient to recover

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costs with a high degree of certainty section 1010.3(f) of BPA’s Procedures, concluded prior to decisions being over the remainder of the rate period. the Administrator directs the Hearing made on system reconfiguration to aid Officer to exclude from the record any threatened and endangered salmon. Part II—Purpose and Scope of material attempted to be submitted or In December 2000, the National Proceeding arguments attempted to be made in the Marine Fisheries Service (NOAA A. Purpose of Proceeding hearing which seek to in any way visit Fisheries) issued a Biological Opinion Triggering SN CRAC starts an the appropriateness or reasonableness of on the operation and configuration of expedited section 7(i) hearing to BPA’s decisions in the TR–04 rate the FCRPS addressing threatened and establish changes in the amount, hearing. endangered salmon. Also in December duration, and timing parameters of the 2000, the U.S. Fish and Wildlife Service 2. Financial Choices and Spending (FWS) issued a Biological Opinion on FB CRAC, taking into account prevailing Levels conditions. On February 7, 2003, the the operation and configuration of the The Financial Choices process BPA Administrator determined that the FCRPS addressing Endangered Species allowed extensive review and comment SN CRAC triggered based upon a Act listed sturgeon and bull trout. on PBL’s costs. Implementation of the NOAA Fisheries forecast of a 50 percent or greater In addition, the decisions made in the chance of missing a payment to the U.S. Biological Opinion requires the Action Financial Choices process implemented Agencies (Corps of Engineers, Bureau of Treasury or another creditor during this prudent cost management to enhance fiscal year. Reclamation, and BPA) to issue annual TPP while minimizing rate impacts. implementation plans and five-year B. Scope of Proceeding These decisions are reflected in prospective implementation plans as assumptions regarding program 1. Other Proceedings well as regular annual progress spending levels in the SN–03 Initial reporting on the success of the Action a. Power Business Line WP–02 Rate Proposal. BPA does not intend to revisit Agencies’ implementation actions. On Case. On July 6, 2000, BPA filed in this proceeding the decisions made November 6, 2002, BPA, the Corps of proposed wholesale power rate during the Financial Choices process, Engineers, and the Bureau of adjustments with FERC as noticed in the including decisions on program Reclamation released the Final FY Federal Register. 16 U.S.C. 839e(a)(2). spending levels. 2003–2007 Implementation Plan for the Proposed Amendments to 2002 Pursuant to section 1010.3(f) of BPA’s FCRPS. The Implementation Plan Wholesale Power Rate Adjustment Procedures, the Administrator directs identifies and describes the specific Proposal, 65 FR 75272 (2000). BPA the Hearing Officer to exclude from the measures that the three agencies plan to supplemented its rate filing with FERC record any material attempted to be implement in FY 2003–FY2007 and on June 29, 2001. The supplementation submitted or arguments attempted to be addresses the actions called for in the of the rate filing included three CRAC made in the hearing which seek to in NOAA Fisheries and FWS 2000 risk mitigation tools. On September 28, any way visit the appropriateness or Biological Opinions for the FCRPS. The 2001, FERC granted interim approval to reasonableness of BPA’s decisions and Implementation Plan forms the basis for BPA’s rates filing. U.S. Department of other decisions made in Financial fish-related hydro-operations Energy—Bonneville Power Admin., 96 Choices on spending levels, as included assumptions and spending level FERC ¶61,360 (2001). in PBL’s test period revenue assumptions in the Initial Proposal. Pursuant to section 1010.3(f) of BPA’s requirement for FY 2003–2006. If, and BPA is currently engaged in regional Procedures, the Administrator directs to the extent, any re-examination of discussions regarding fish-related the Hearing Officer to exclude from the spending levels is necessary, that re- changes to hydro operations, which are record any material attempted to be examination will occur outside of the being evaluated in a regional forum. The submitted or arguments attempted to be rate case. Excepted from this direction Northwest Power Planning and made in the hearing which seek to in on account of their variable nature, Conservation Council (Council) is any way visit the appropriateness or dependency on PBL’s rate case models, evaluating these proposed changes in its reasonableness of BPA’s decisions in the or timing, are: (1) Forecasts of short- mainstem rulemaking proceedings. WP–02 rate hearing. These decisions term purchase power costs; (2) capital Upon receipt of the Council’s final include but are not limited to issues recovery matters such as interest rate recommendations, the Action Agencies, related to the Slice methodology and forecasts, scheduled amortization, in coordination with NOAA Fisheries contract issues including the Slice depreciation, replacements, and interest and FWS, may decide to implement audit. expense; and (3) inter-business line changes to measures as outlined in the b. Transmission Business Line TR–04 expenses. Action Agencies Implementation Plan. Rate Proceeding. On December 20, 2002, The proposed changes are included in BPA’s Transmission Business Line 3. Fish and Wildlife Costs and Hydro the analysis used to prepare BPA’s (TBL) published a Federal Register Operations Initial Proposal. To the extent other Notice announcing the initiation of a In BPA’s WP–02 Wholesale Power decisions are made in these proceedings rate-setting process for the FY 2004– Rate Case, potential fish and wildlife by the time BPA’s Final ROD is 2005 period. TBL’s Initial Proposal costs were reflected probabilistically, prepared, those decisions will be reflected a settlement reached between based on 13 system configuration included in the Final ROD. BPA and its transmission customers. alternatives arrived at during the BPA’s fish and wildlife program The Initial Proposal contains certain development of the Fish and Wildlife spending levels are developed to assumptions regarding TBL’s revenues Funding Principles (Revenue implement not only the Action and expenses over the rate period. Some Requirement Study Documentation, Agencies’ Implementation Plan, but also of these assumptions have been used in Volume 1, WP–02–FS–BPA–02A, a set of operational, habitat, harvest, and developing aspects of the SN–03 Chapter 13). These alternatives were hatchery measures to protect, mitigate, proposal and are identified in the developed specifically to inform and and enhance non-ESA listed species supporting documentation. BPA does guide PBL’s Subscription Process and affected by the FCRPS. When BPA not intend to revisit the underlying power rate-setting, keeping options initiated Financial Choices, fish and basis for TBL’s assumptions. Pursuant to open because those processes would be wildlife spending levels were presented

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and comments were taken. Those would not be expected to result in requesting party status and the person’s spending levels, including expenses and significantly different environmental interest in the hearing. capital, are reflected in the SN–03 Initial impacts from those examined for the Petitions to intervene as parties in the Proposal, but are currently under review Market-Driven Alternative in the rate proceeding are due to the Hearing by the Council. If BPA changes those Business Plan EIS. Furthermore, Officer by 9 a.m. on March 26, 2003. levels based on recommendations by the implementation of this rate proposal The petitions should be directed to: Council prior to writing the Final would be consistent with the response Maya R. Ferry, Hearing Clerk—LP, Record of Decision (ROD), those strategy of raising firm power rates to Bonneville Power Administration, 905 changes will be reflected in the Final generate necessary revenues that was N.E. 11th Ave., P.O. Box 12999, ROD. identified for all alternatives in the Portland, Oregon 97212. Pursuant to section 1010.3(f) of BPA’s Business Plan EIS and Business Plan Petitioners must explain their Procedures, the Administrator directs ROD. Therefore, BPA expects that this interests in sufficient detail to permit the Hearing Officer to exclude from the rate proposal will fall within the scope the Hearing Officer to determine record any material attempted to be of the Market-Driven Alternative that whether they have a relevant interest in submitted or arguments attempted to be was evaluated in the Final Business the hearing. Pursuant to Rule 1010.1(d) made in the hearing which seek in any Plan EIS and adopted in the Business of BPA’s Procedures, BPA waives the way to revisit the policy merits or Plan ROD, and that BPA thus may tier requirement in Rule 1010.4(d) that an wisdom of implementation of the its decision under NEPA for the opposition to an intervention petition be Biological Opinion, or the related proposed rate adjustment to the filed and served 4 days before the operations, assumptions, and program Business Plan ROD. prehearing conference. Any opposition spending level forecasts included in to an intervention petition instead may BPA’s rate proposal, as discussed above. Part III—Public Participation be made at the prehearing conference. The Implementation Plan and any A. Distinguishing Between Any party, including BPA, may oppose subsequent modifications were and are ‘‘Participants’’ and ‘‘Parties’’ a petition for intervention. Persons who developed through extensive public have been denied party status in any involvement and comment processes, BPA distinguishes between past BPA rate proceeding shall continue and have been and will be adopted as ‘‘participants in’’ and ‘‘parties to’’ the to be denied party status unless they policy pursuant to those separate hearings. Apart from the formal hearing establish a significant change of processes. process, BPA will receive comments, circumstances. All timely applications views, opinions, and information from will be ruled on by the Hearing Officer. C. National Environmental Policy Act ‘‘participants,’’ who are defined in the Late interventions are strongly BPA is in the process of assessing the BPA Procedures as persons who may disfavored. Opposition to an untimely potential environmental effects of this submit comments without being subject petition to intervene shall be filed and proposed rate adjustment, consistent to the duties of, or having the privileges received by BPA within two days after with the requirements of the National of, parties. Participants’ written and oral service of the petition. Environmental Policy Act (NEPA) and comments will be made part of the B. Developing the Record its implementing regulations. In its official record and considered by the Business Plan Final Environmental Administrator. Participants are not The record will include, among other Impact Statement, DOE/EIS–0183, June entitled to participate in the prehearing things, the transcripts of all hearings, 1995 (Business Plan EIS), BPA conference; may not cross-examine any written material submitted by the evaluated the environmental impacts of parties’ witnesses, seek discovery, or parties, documents developed by BPA a range of business structure alternatives serve or be served with documents; and staff, BPA’s environmental analysis and that included, among other things, are not subject to the same procedural comments accepted on it, and other various combinations of power pricing requirements as parties. material accepted into the record by the and rate designs for BPA’s power rates. Hearing Officer. The Hearing Officer In addition, the Business Plan EIS Written comments by participants then will review the record, will identifies various response strategies, will be included in the record if they are supplement it if necessary, and will such as raising firm power rates, that received by May 1, 2003. This date certify the record to the Administrator could be implemented to address follows the anticipated submission of for decision. Given the need for the SN revenue shortfalls. In August 1995, the BPA’s and all other parties’ direct cases. CRAC adjustment to be in place by BPA Administrator issued a Record of Written views, supporting information, October 1, 2003, the Administrator Decision (Business Plan ROD) that questions, and arguments should be directs the Hearing Officer to conclude adopted the Market-Driven Alternative submitted to the address listed in the hearing process no later than July from the Business Plan EIS. This Section I. of this Notice. In addition, 10, 2003 so as to allow BPA sufficient alternative was selected because, among BPA will hold a field hearing in time to comply with 18 CFR part 300. other reasons, it is the alternative that Portland, Oregon on April 16, 2003. The Administrator will develop final best allows BPA to: (1) Recover costs Participants may appear at the field proposed rates based on the entire through rates; (2) achieve strategic hearing and present oral testimony. The record, including the record certified by business objectives; (3) competitively transcripts of these hearings will be a the Hearing Officer, comments received market BPA’s products and services; part of the record upon which the from participants, other material and and (4) continue to meet BPA’s legal Administrator makes his final rate information submitted to or developed mandates. decisions. by the Administrator, and any other An initial review of this proposed rate Persons wishing to become a party to comments received during the rate adjustment indicates that it is consistent BPA’s rate proceeding must notify BPA development process. The basis for the with these aspects of the Market-Driven in writing. Petitioners may designate no final proposed rates first will be Alternative. This rate proposal would more than two representatives upon expressed in the Administrator’s Draft result in rate levels similar to those whom service of documents will be ROD. Parties will have an opportunity resulting from the rate designs evaluated made. Petitions to intervene shall state to respond to the Draft ROD as provided in the Business Plan EIS, and thus the name and address of the person in BPA’s Procedures. The Administrator

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will serve copies of the Final ROD on B. Safety-Net Cost Recovery Adjustment Probability (TRP), requires that the all parties. At the conclusion of the rate Clause Design calculated probability that BPA will be proceeding, BPA will file the SN–03 rate BPA’s SN CRAC proposal uses a able to make all of its FY 2006 payments proposal with FERC for confirmation Treasury payment probability measure to the U.S. Treasury, including and approval. different from that used in prior rate repayment of any amounts missed in BPA must continue to meet with cases. BPA is concerned that a rate years FY 2003–2005, is at least 80 customers in the ordinary course of increase of the magnitude necessary to percent. The third standard requires that business during the rate case. To achieve the 80–88 percent five-year TPP net revenues over the FY 2002–2006 comport with the rate case procedural standard used to establish the WP–02 period are zero or greater. These criteria rule prohibiting ex parte rates is not sustainable in the current provide a high level of assurance that communications, BPA will provide economy. Therefore, BPA is proposing BPA’s obligations to the U.S. Treasury notice of meetings involving rate case to relax the standard, but at the same will be satisfied by the end of FY 2006. issues for participation by all rate case time provide sufficient assurance that C. BPA’s Proposal parties. Parties should be aware, by the end of the rate period BPA will however, that such meetings may be have a high probability of making its The proposed SN CRAC design is held on very short notice and they payment to the U.S. Treasury. This similar to the existing FB CRAC as should be prepared to devote the assurance will be met in part by an described in the 2002 GRSPs. The necessary resources to participate fully additional criterion that the PBL proposed SN CRAC is a temporary, in every aspect of the rate proceeding. expected net revenues for the entire rate upward adjustment to posted power Consequently, parties should be period (FY 2002–2006) will be zero or rates based on the level of end-of-year prepared to attend meetings every day greater. For the next general rate ANR in the generation function, as during the course of the rate case. proceeding, BPA intends to return to its defined in the section on the FB CRAC in the 2002 GRSPs. The August forecast Part IV—BPA’s Proposed Solution to long-term goal of 88 percent TPP. of ANR or each fiscal year from 2003– the Cost Recovery Problem In January 1993, BPA adopted a 10- Year Financial Plan that included a TPP 2005 is compared to the SN CRAC A. Introduction standard for use in setting BPA’s rates. threshold applicable to that fiscal year. As noted earlier, the Administrator At that time, BPA typically had two- If the forecasted ANR is below the determined that in spite of the year rate periods and the TPP standard threshold, an SN CRAC rate adjustment significant cost cutting identified in the called for achieving a 95 percent will be implemented to collect either Financial Choices process, BPA has less probability that BPA would make all of the amount of the difference between than a 50 percent probability of meeting its Treasury payments in that rate the forecasted ANR and the threshold, its Treasury payment obligations. On period on time and in full. BPA’s 1996 or an annual cap, whichever is smaller. February 7, 2003, the Administrator sent rates were set to cover a five-year The proposed SN CRAC rate adjustment a letter to rate case parties and other period, and in that process, the 95 will be determined annually, go into interested individuals explaining the percent probability was translated into effect on October 1 of each year, and be continued deterioration of BPA’s an 88 percent five-year TPP that in effect for the remainder of that fiscal financial situation and announcing the provided comparable assurance of year. The adjustment will be applied to triggering of the SN CRAC process. timely repayment. The Fish and the appropriate rates for the 12-month BPA is proposing a three-year variable Wildlife Funding Principles guided the fiscal year. SN CRAC adjustment to power rates, development of power rates for the FY The ANR threshold levels for the which has a cap limiting the amount of 2002–2006 rate period. In the Fish and remaining three years of the rate period ¥ revenues that can be collected each Wildlife Funding Principles, the are: $-400 million for FY 2004, $ 140 year. Under BPA’s proposal, in August standard for that five-year TPP was million for FY 2005, and $5 million for of each year, the level of SN CRAC for allowed to be in the range of 80 to 88 2006. The annual cap is $470 million. the next fiscal year will be determined, percent in light of the economic burden Consistent with the 2002 GRSPs, the based on the then-current forecast of that achieving the full 88 percent TPP SN CRAC applies to power customers PBL’s accumulated net revenues (ANR) would impose on the Pacific Northwest under the following firm power rate for the end of the then-current fiscal region. schedules: year. The annual average expected value Specifically for the SN CRAC 1. PF Preference (PF excluding Slice), for the SN CRAC is about 30 percent proceeding, BPA is proposing to use PF Exchange Program, and PF Exchange above May 2000 base rates. The three payment probability criteria in Subscription; adjustment in a particular year could be lieu of the long-term goal, mentioned 2. Industrial Firm Power (IP–02), as high as 41 percent or as low as zero, above, including the net revenue including purchases under the depending on PBL’s financial condition criterion. BPA does not intend to Industrial Firm Power Targeted as reflected in BPA’s forecasted ANR. replace the 88 percent standard, but is Adjustment Charge (IPTAC) and Cost- These percentages do not reflect the proposing these three alternative Based Index Rate; overall rate increase customers can standards in this SN–03 process in order 3. Residential Load (RL–02), expect after the implementation of to meet the twin goals of moving toward including both actual power deliveries PBL’s proposed SN CRAC because of the a financially healthier BPA while and the monetary benefits of any interaction among the three CRACs. The limiting the effect on a fragile economy. Residential Exchange Program (REP) total power rate customers will pay will The first criterion is a 50 percent Settlement; reflect changes to the LB and FB CRACs probability that BPA can make all of its 4. New Resource Firm Power (NR–02); and the proposed SN CRAC. While it Treasury payments in the FY 2004–2006 and will vary, the resulting total rate is three year period. This is relaxed from 5. Subscription purchases under Firm expected to be about 16 percent, on 87.5 percent, which is the three-year Power Products and Services (FPS). average, above FY2003 rates (which probability that corresponds to 80 The SN CRAC does not apply to: include LB and FB CRACs) for the percent for a five-year period. The 1. Pre-Subscription Contracts (to the remainder of the rate period. second standard, a Treasury Recovery extent prohibited by contract);

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2. Seasonal and Irrigation Mitigation will compare the forecasted ANR to the revenue forecast when determining the Contracts; or SN CRAC Threshold applicable to that SN CRAC. 3. Slice Purchases. year to determine the SN CRAC to be Where Maximum Planned Recovery implemented. If the ANR at the end of D. Summary of Supporting Study Amount is the maximum annual the forecast year falls below the SN amount planned to be recovered There will be one study with seven CRAC Threshold applicable to that through the SN CRAC. chapters supporting BPA’s SN CRAC fiscal year, an SN CRAC rate adjustment proposal. Chapter 1 describes PBL’s will be implemented. That SN CRAC TABLE A financial conditions and an overview of rate adjustment will go into effect [DOLLARS IN MILLIONS] BPA’s SN CRAC proposal. Chapter 2 beginning in October of the upcoming describes the methodology for PBL’s fiscal year (FY 2004–2006). Maximum loads and sales forecasts. It also The Revenue Amount will be SN CRAC Planned includes the assumptions used in the determined by the following formula: End of fiscal threshold Recovery development of the hydro regulation year Amount Revenue Amount is the lower of: (ANR) (Beginning study and other resources. Chapter 3 October) contains BPA’s generation revenue SN CRAC Threshold minus forecasted ANR; or requirement including a forecast of 2003 ...... $¥400 $470 generation expenses. Chapter 4 The annual Maximum Planned 2004 ...... ¥140 470 describes the analysis that quantifies Recovery Amount, shown in Table 2005 ...... 5 470 PBL’s net revenue risk. Chapter 5 A below. describes the methodology and resulting Where Revenue Amount is the Once the Revenue Amount is forecast of PBL’s secondary revenues. amount of additional revenue that an determined, that amount will be Chapter 6 contains PBL’s revenue adjustment in rates under SN CRAC is converted to the SN CRAC Percentage. forecast at current and proposed rates, intended to generate during the one year The SN CRAC Percentage is the and chapter 7 describes the Tool Kit period that the rate adjustment is percentage adjustment in customers’ model, the SN CRAC proposed design effective. rates (not including LB CRAC or FB and the associated GRSPs. Where SN CRAC Threshold is the CRAC) in each of the firm power rate Part V—The Amended 2002 GRSPs ANR level below which a rate schedules listed above. This percentage adjustment is determined. The will be applied to generate the Safety-Net Cost Recovery Adjustment thresholds specified for the end of FY additional SN CRAC revenue. Clause (SN CRAC) 2003, 2004, and 2005 are shown in The SN CRAC Percentage will be The SN CRAC applies to power Table A. determined by the following formula: Where ANR is generation function net purchases under the following firm SN CRAC Percentage = power rate schedules: PF [Preference revenues, as accumulated since 1999, at (excluding Slice), Exchange Program the end of each of the fiscal years 2003– Revenue Amount and Exchange Subscription]; Industrial 2005. The forecast of ANR through the Divided by SN CRAC Revenue Basis Firm Power (IP–02), including end of each fiscal year will be calculated SN CRAC Revenue Basis is the total purchases under the Industrial Firm and used to determine if the threshold generation revenue (not including LB Power Targeted Adjustment Charge has been reached and the Revenue CRAC or FB CRAC) for the loads subject (IPTAC) and Cost-Based Index Rate; Amount needed. Net revenues for any to SN CRAC for the fiscal year in which Residential Load (RL–02) (including given fiscal year are accrued revenues the SN CRAC implementation begins, both actual power deliveries and the less accrued expenses, in accordance based on the then most current revenue 900 aMW of monetary benefits under with Generally Accepted Accounting forecast. Each non-Slice product’s total the financial portion of any REP Principles, with the following two charge for energy, demand, and load Settlement, buy-downs and load exceptions. First, for purposes of variance will be adjusted by this CRAC reduction agreements); New Resource determining if the SN CRAC threshold percentage amount. has been reached, actual and forecasted Firm Power (NR–02); and subscription Payment under the SN CRAC rate expenses will include BPA expenses purchases under Firm Power Products adjustment will be due monthly from associated with Energy Northwest debt and Services (FPS). The SN CRAC does November (for the October billing service as forecasted in the WP–02 Final not apply to power purchases under period) through October of the following Studies. Second, the impact of adopting Pre-Subscription contracts to the extent year. prohibited by such contracts, to BPA’s Financial Accounting Standard 133, current contractual obligations for Accounting for Derivative Instruments In August prior to the beginning of Seasonal and Irrigation Mitigation sales and Hedging Activities, will not be each fiscal year of the rate period (FY including for any eligible customer that considered in determining if the SN 2004–2006), the Administrator will converts from Slice to another BPA CRAC threshold has been reached. Only compare the ANR forecast at the end of product, or to purchases under the PF generation function actual and that current fiscal year to that year SN Slice Rate. forecasted revenues and expenses that CRAC Threshold. The customers will be are associated with the production, billed in accordance with the SN CRAC A. Formula for Calculation of the acquisition, marketing, and adjustment. Safety-Net Cost Recovery Adjustment conservation of electric power, will be Each customer will be notified, on or Clause included in determinations under the about September 1st, of the percentage By August of each fiscal year (FY SN CRAC. Accrued revenues and adjustment in rates due to the SN CRAC. 2003–2005) immediately prior to each expenses of the transmission function The rates used to calculate the fiscal year of the remainder of the rate are excluded. Impacts of forecasted customers’ bills for the following period (i.e., FY 2004–2006), a forecast of revenues, positive or negative, from October through September for FY that end-of-year Accumulated Net contractual true-up pursuant to the Slice 2004–2006, will reflect the SN CRAC Revenue (ANR) will be completed. BPA Agreement shall be included in the adjustment.

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B. Retriggering of the SN CRAC options that enhance Treasury Payment taken, but will not serve to make The SN CRAC will be retriggered if Probability while minimizing changes to protestants parties to the proceeding. the Administrator determines that, after the SN CRAC. Any person wishing to become a party implementation of the FB CRAC, the b. SN CRAC Hearing Process. As soon must file a motion to intervene. All such currently active SN CRAC, and any as practicable after a determination that motions or protests should be filed on forecast of Augmentation True-Ups, the SN CRAC has retriggered, BPA will or before the comment date, and, to the either of the following conditions exists: publish a Federal Register Notice extent applicable, must be served on the • BPA forecasts a 50 percent or initiating an expedited hearing process applicant and on any other person greater probability that it will to be conducted in accordance with designated on the official service list. nonetheless miss a payment to the U.S. Section 7(i) of the Northwest Power Act. This filing is available for review at the Treasury or other creditor, or The hearing shall be completed within Commission or may be viewed on the • BPA has missed a payment to the 40 days, unless a different duration is Commission’s Web site at http:// U.S. Treasury or has satisfied its agreed to by BPA and the parties. Upon www.ferc.gov, using the ‘‘FERRIS’’ link. obligation to the U.S. Treasury but has completion of such hearing, BPA will Enter the docket number excluding the missed a payment to any other creditor. submit the following documentation to last three digits in the docket number A retriggering of the SN CRAC will FERC in support of a request for review field to access the document. For result in an upward adjustment to and confirmation: Statements A through assistance, please contact FERC Online posted power rates listed above by F from the 2002–2006 BPA Wholesale Support at modifying the SN CRAC parameters that Power Rate Adjustment Proceedings, [email protected] or toll- are currently in use. BPA will propose Separate Accounting Analyses, current free at (866) 208–3676, or for TTY, changes to the SN CRAC parameters that and revised revenue tests, the proposed contact (202) 502–8659. Protests and will, to the extent market and other risk revisions to the SN CRAC parameters interventions may be filed electronically factors allow, achieve a high probability and the administrative record compiled via the Internet in lieu of paper; see 18 that the remainder of Treasury by BPA in the SN CRAC proceeding. CFR 385.2001(a)(1)(iii) and the payments during the FY 2002–2006 rate The changes to the SN CRAC instructions on the Commission’s Web period will be made in full. BPA’s parameters shall take effect 60 days site under the ‘‘e-Filing’’ link. The proposal could include changes to the from filing with FERC unless FERC Commission strongly encourages Revenue Amount, the Cap, the orders otherwise prior to that time. electronic filings. Comment Date: 20 days from the date Threshold, the duration (the length of Issued in Portland, Oregon, on March 6, of publication in the Federal Register. time the SN CRAC would be in place, 2003. which could be more than one year), Stephen J. Wright, Magalie R. Salas, and the timing of collection. The Administrator and Chief Executive Officer, Secretary. additional revenue to be generated by Bonneville Power Administration. [FR Doc. 03–6000 Filed 3–12–03; 8:45 am] the SN CRAC will be collected through [FR Doc. 03–6091 Filed 3–12–03; 8:45 am] BILLING CODE 6717–01–P a percentage adjustment in applicable BILLING CODE 6450–01–P rates and a commensurate decrease in the financial portion of the Residential DEPARTMENT OF ENERGY Exchange Settlement. In addition to the DEPARTMENT OF ENERGY revenue generated by the SN CRAC, Federal Energy Regulatory BPA’s payments for IOU load reductions Federal Energy Regulatory Commission Commission will be reduced in accordance with [Docket No. RP03–288–000] contractual provisions. [Docket No. AC03–20–000] a. SN CRAC Notification Process. At ANR Pipeline Company; Notice of the time the Administrator determines American Electric Power Service Proposed Changes in FERC Gas Tariff that the SN CRAC has retriggered, BPA Corporation; Notice of Filing will send written notification of the March 6, 2003. determination to customers that March 7, 2003. Take notice that on February 28, 2003, purchase power under rates subject to Take notice that on January 29, 2003, ANR Pipeline Company (ANR) tendered the SN CRAC and to interested parties. American Electric Power Service for filing, as part of its FERC Gas Tariff, Such notification shall include the Corporation (AEP) tendered for filing Second Revised Volume No. 1 (Tariff), documentation used by BPA to with the Federal Energy Regulatory the following tariff sheets proposed to determine that the SN CRAC has Commission (Commission) a letter become effective March 1, 2003: retriggered, the amount of any forecast addressed to John M. Delaware, Chief Fifty-Fifth Revised Sheet No. 8. shortfall, and the time and location of a Accountant of the Commission, Fifty-Fifth Revised Sheet No. 9. workshop on the SN CRAC. requesting authorization to retain and Fifty-Fourth Revised Sheet No. 13. The purpose of the SN CRAC recognize as a regulatory asset Regional Sixty-Sixth Revised Sheet No. 18. workshop will be to discuss with Transmission Organization (RTO) ANR states that the above-referenced customers and interested parties the formation/integration cost deferrals. tariff sheets are being filed to implement cause of the shortfall, and any proposed Any person desiring to intervene or to recovery of approximately $3.1 million changes to the SN CRAC that will protest this filing should file with the of above-market costs that are associated achieve a high probability that the Federal Energy Regulatory Commission, with its obligations to Dakota remainder of Treasury payments during 888 First Street, NE., Washington, DC Gasification Company (Dakota). ANR the FY 2002–2006 rate period will be 20426, in accordance with rules 211 and proposes a reservation surcharge made on time. In determining which 214 of the Commission’s rules of applicable to its part 284 firm proposal to include in its initial practice and procedure (18 CFR 385.211 transportation customers to collect proposal in the SN CRAC Section 7(i) and 385.214). Protests will be ninety percent (90%) of the Dakota proceeding, BPA will give priority to considered by the Commission in costs, and an adjustment to the prudent cost management and other determining the appropriate action to be maximum base tariff rates of Rate

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Schedule ITS and overrun rates ANR states that the above-referenced DEPARTMENT OF ENERGY applicable to Rate Schedule FTS–2, so tariff sheet is being filed to implement as to recover the remaining ten percent the annual reconciliation of the recovery Federal Energy Regulatory (10%). ANR advises that the proposed of its Above-Market Dakota Costs, as Commission changes would increase current required by its tariff recovery quarterly Above-Market Dakota Cost mechanism. ANR advises that the filing [Docket No. RP03–290–000] recoveries from $2,326,128 to proposes a reservation surcharge $3,091,394. adjustment of $0.012 applicable to its ANR Pipeline Company; Notice of Proposed Changes in FERC Gas Tariff Any person desiring to be heard or to currently effective, firm service Rate protest said filing should file a motion Schedules. Pursuant to this surcharge, March 6, 2003. to intervene or a protest with the ANR proposes to recover, over the Take notice that on February 28, 2003, Federal Energy Regulatory Commission, twelve month period of March 1, 2003 888 First Street, NE., Washington, DC ANR Pipeline Company (ANR) tendered to February 29, 2004, the $645,001 of 20426, in accordance with Sections for filing, as part of its FERC Gas Tariff, Above-Market Dakota Cost under 385.314 or 385.211 of the Commission’s Second Revised Volume No. 1, the Rules and Regulations. All such motions collections, inclusive of interest, which following tariff sheets to be effective or protests must be filed in accordance are reflected in the filing. April 1, 2003: with Section 154.210 of the Any person desiring to be heard or to Nineteenth Revised Sheet No. 19. Commission’s Regulations. Protests will protest said filing should file a motion Ninth Revised Sheet No. 68H. be considered by the Commission in to intervene or a protest with the ANR states that the above-referenced determining the appropriate action to be Federal Energy Regulatory Commission, tariff sheets are being filed to comply taken, but will not serve to make 888 First Street, NE., Washington, DC with the annual re-determination of the protestants parties to the proceedings. 20426, in accordance with Sections levels of ‘‘Transporter’s Fuel Use (%)’’, Any person wishing to become a party 385.314 or 385.211 of the Commission’s as required by ANR’s currently effective must file a motion to intervene. This Rules and Regulations. All such motions tariff. In accordance with Section 1.68 of filing is available for review at the or protests must be filed in accordance the General Terms and Conditions in Commission in the Public Reference with Section 154.210 of the ANR’s tariff, the annual re-determined Room or may be viewed on the Commission’s Regulations. Protests will percentages are based upon ANR’s most Commission’s Web site at http:// be considered by the Commission in recent three (3) calendar years’ www.ferc.gov using the ‘‘FERRIS’’ link. determining the appropriate action to be experience of compressor fuel usage Enter the docket number excluding the taken, but will not serve to make (2000, 2001 and 2002), and most recent last three digits in the docket number protestants parties to the proceedings. four (4) years’ experience of Lost and field to access the document. For Any person wishing to become a party Unaccounted For gas (1999, 2000, 2001 assistance, please contact FERC Online must file a motion to intervene. This and 2002). Support at Any person desiring to be heard or to [email protected] or toll- filing is available for review at the Commission in the Public Reference protest said filing should file a motion free at (866) 208–3676, or TTY, contact to intervene or a protest with the Room or may be viewed on the (202) 502–8659. The Commission Federal Energy Regulatory Commission, Commission’s Web site at http:// strongly encourages electronic filings. 888 First Street, NE., Washington, DC See 18 CFR 385.2001(a)(1)(iii) and the www.ferc.gov using the ‘‘FERRIS’’ link. 20426, in accordance with Sections instructions on the Commission’s Web Enter the docket number excluding the 385.314 or 385.211 of the Commission’s site under the ‘‘e-Filing’’ link. last three digits in the docket number Rules and Regulations. All such motions Intervention and Protest Date: March field to access the document. For or protests must be filed in accordance 12, 2003. assistance, please contact FERC Online with Section 154.210 of the Support at Magalie R. Salas, Commission’s Regulations. Protests will [email protected] or toll- Secretary. be considered by the Commission in free at (866) 208–3676, or TTY, contact determining the appropriate action to be [FR Doc. 03–6030 Filed 3–12–03; 8:45 am] (202) 502–8659. The Commission taken, but will not serve to make BILLING CODE 6717–01–P strongly encourages electronic filings. protestants parties to the proceedings. See 18 CFR 385.2001(a)(1)(iii) and the Any person wishing to become a party DEPARTMENT OF ENERGY instructions on the Commission’s Web must file a motion to intervene. This site under the ‘‘e-Filing’’ link. filing is available for review at the Federal Energy Regulatory Comment Date: March 12, 2003. Commission in the Public Reference Commission Room or may be viewed on the Magalie R. Salas, Commission’s Web site at http:// www.ferc.gov using the ‘‘FERRIS’’ link. [Docket No. RP03–289–000] Secretary. [FR Doc. 03–6031 Filed 3–12–03; 8:45 am] Enter the docket number excluding the ANR Pipeline Company; Notice of BILLING CODE 6717–01–P last three digits in the docket number Proposed Changes in FERC Gas Tariff field to access the document. For assistance, please contact FERC Online March 6, 2003. Support at Take notice that, on February 28, [email protected] or toll- 2003, ANR Pipeline Company (ANR) free at (866) 208–3676, or TTY, contact tendered for filing as part of its FERC (202) 502–8659. The Commission Gas Tariff, Second Revised Volume No. strongly encourages electronic filings. 1, Sixty-Seventh Revised Tariff Sheet See 18 CFR 385.2001(a)(1)(iii) and the No. 18, proposed to become effective instructions on the Commission’s Web March 1,003. site under the ‘‘e-Filing’’ link.

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Comment Date: March 12, 2003. SoLoNox simple cycle gas turbine There are two ways to become engine, with appurtenances, which have involved in the Commission’s review of Magalie R. Salas, a combined horsepower rating of 18,390 this project. First, any person wishing to Secretary. (ISO).1 The Solar Centaur 50S–T6100 obtain legal status by becoming a party [FR Doc. 03–6032 Filed 3–12–03; 8:45 am] simple cycle gas turbine engine is to the proceedings for this project BILLING CODE 6717–01–P equipped with air emission-lowering should file with the Federal Energy SoLoNox technology. Regulatory Commission, 888 First (3) Restage the three existing Street, NE., Washington, DC 20426, a DEPARTMENT OF ENERGY compressor units at the Bondad motion to intervene in accordance with Compressor Station. The compressors the requirements of the Commission’s Federal Energy Regulatory will be disassembled and the single Commission stage aerodynamic assembly of each rules of practice and procedure (18 CFR [Docket No. CP03–57–000] compressor will be removed and 385.214 or 385.211) and the regulations exchanged with a two stage assembly. under the NGA (18 CFR 157.10) by the El Paso Natural Gas Company; Notice In its application, El Paso states that comment date, below. A person of Application it has designed the Bondad Expansion obtaining party status will be placed on Project to permit El Paso to offer the service list maintained by the March 7, 2003. additional firm transportation capacity Secretary of the Commission and will Take notice that on February 27, 2003, on a defined receipt/delivery point basis receive copies of all documents filed by El Paso Natural Gas Company (El Paso), of up to 140,000 Mcf per day, while the applicant and by all other parties. A P. O. Box 1087, Colorado Springs, continuing to meet the current transport party must submit 14 copies of filings Colorado 80944 filed in Docket No. capacity needs of its existing shippers made with the Commission and must CP03–57–000, an application pursuant (approximately 585.5 MMcf per day). mail a copy to the applicant and to to sections 7(b) and 7(c) of the Natural According to El Paso, this additional Gas Act (NGA), as amended, and part every other party in the proceeding. firm capacity will be offered from Only parties to the proceeding can ask 157 of the regulations of the Federal receipt points upstream of the Bondad Energy Regulatory Commission for court review of Commission orders Compressor Station to a proposed new in the proceeding. (Commission), for permission and delivery point located near its existing approval to abandon, by removal, Blanco Compressor Station located in However, a person does not have to certain existing mainline compression San Juan County, New Mexico. Since intervene in order to have comments facilities, with appurtenances, and for a this new increment of firm capacity is considered. The second way to certificate of public convenience and only available to the Blanco area, El participate is by filing with the necessity authorizing the construction Paso states that the project will not Secretary of the Commission, as soon as and operation of new mainline create additional mainline capacity out possible, an original and two copies of compression facilities, with of the San Juan Basin. comments in support of or in opposition appurtenances, all located at El Paso’s In support of the Bondad Expansion to this project. The Commission will existing Bondad Compressor Station in Project, El Paso states that it has entered consider these comments in La Plata County, Colorado (Bondad into a binding firm Transportation determining the appropriate action to be Expansion Project), all as more fully set Service Agreement with BP Energy taken, but the filing of a comment alone forth in the application which is on file Company (BP) for the transportation of will not serve to make the filer a party with the Commission and open to gas on El Paso’s existing Ignacio Lines to the proceeding. The Commission’s public inspection. This filing is from any point of receipt in the Bondad rules require that persons filing available for review at the Commission Pooling Area to the Blanco Delivery comments in opposition to the project or may be viewed on the Commission’s Point. El Paso also states that the provide copies of their protests only to Web site at http://www.ferc.gov using contract demand under this TSA equals the party or parties directly involved in the ‘‘FERRIS’’ link. Enter the docket the proposed 140,000 Mcf per day the protest. number excluding the last three digits in increase in design capacity for the docket number field to access the transportation on the Bondad System. Protests and interventions may be document. For assistance, please contact El Paso states that the cost for the filed electronically via the Internet in FERC Online Support at Bondad Expansion Project is lieu of paper; see 18 CFR [email protected] or toll- approximately $7,307,700 and El Paso 385.2001(a)(1)(iii) and the instructions free at (866) 208–3676, or for TTY, plans to place the proposed facilities in on the Commission’s Web site under the contact (202) 502–8659. service by April 1, 2004. ‘‘e-Filing’’ link. The Commission El Paso states that it is proposing to Any questions concerning this strongly encourages electronic filings. application may be directed to Robert T. undertake the following activities at its If the Commission decides to set the existing Bondad Compressor Station Tomlinson, Director, Regulatory Affairs, El Paso Natural Gas Company, P. O. Box application for a formal hearing before located in La Plata County, Colorado: an Administrative Law Judge, the (1) Abandon two existing Solar 1087, Colorado Springs, Colorado, Commission will issue another notice Centaur T4000 simple cycle gas turbine 80944, at (719) 520–3788 or fax (719) describing that process. At the end of engines and one Solar Centaur T3550 520–4318; or to Judy A. Heineman, Vice the Commission’s review process, a simple cycle gas turbine engine which President and General Counsel, El Paso have a combined horsepower rating of Corporation—Western Pipelines final Commission order approving or 10,740 (ISO), with appurtenant Division, P. O. Box 1087, Colorado denying a certificate will be issued. equipment. Springs, Colorado, 80944, at (719) 520– Comment Date: March 28, 2003. (2) Replace the three existing Solar 4829 or fax (719) 520–4898. Centaur simple cycle gas turbine Magalie R. Salas, engines with two Solar Centaur 50– 1 Note that El Paso is seeking abandonment Secretary. authorization for the three units that will be [FR Doc. 03–6001 Filed 3–12–03; 8:45 am] T6100L simple cycle gas turbine engines replaced. El Paso will exchange the existing units and one Solar Centaur 50S–T6100 for the three units with the manufacturer. BILLING CODE 6717–01–P

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DEPARTMENT OF ENERGY Any person wishing to become a party with Section 154.210 of the must file a motion to intervene. This Commission’s Regulations. Protests will Federal Energy Regulatory filing is available for review at the be considered by the Commission in Commission Commission in the Public Reference determining the appropriate action to be [Docket No. RP03–298–000] Room or may be viewed on the taken, but will not serve to make Commission’s Web site at http:// protestants parties to the proceedings. Great Lakes Gas Transmission Limited www.ferc.gov using the ‘‘FERRIS’’ link. Any person wishing to become a party Partnership; Notice of Request for Enter the docket number excluding the must file a motion to intervene. This Emergency Waiver last three digits in the docket number filing is available for review at the field to access the document. For Commission in the Public Reference March 7, 2003. assistance, please contact FERC Online Room or may be viewed on the Take notice that on March 6, 2003, Support at Commission’s Web site at http:// Great Lakes Gas Transmission Limited [email protected] or toll- www.ferc.gov using the ‘‘FERRIS’’ link. Partnership (Great Lakes) filed a request free at (866) 208–3676, or TTY, contact Enter the docket number excluding the for emergency waiver of its tariff to be (202) 502–8659. Comments, protests and last three digits in the docket number effective during the curtailment period interventions may be filed electronically field to access the document. For resulting from a recent force majeure via the Internet in lieu of paper. The assistance, please contact FERC Online event on Great Lakes’ system. Great Commission strongly encourages Support at Lakes declared force majeure on its electronic filings. See 18 CFR [email protected] or toll- system because of a major failure on one 385.2001(a)(1)(iii) and the instructions free at (866) 208–3676, or TTY, contact of its compressor units located at a on the Commission’s Web site under the (202) 502–8659. The Commission Shelvin, Minnesota compressor station. ‘‘e-Filing’’ link. strongly encourages electronic filings. The event resulted in curtailment of Comment Date: March 14, 2003. See 18 CFR 385.2001(a)(1)(iii) and the firm transportation service offered instructions on the Commission’s Web under Great Lakes’ FERC Gas Tariff. Magalie R. Salas, site under the ‘‘e-Filing’’ link. Great Lakes states that it provides firm Secretary. Comment Date: March 11, 2003. transportation to shippers some of [FR Doc. 03–6005 Filed 3–12–03; 8:45 am] which serve communities and industrial BILLING CODE 6717–01–P Magalie R. Salas, customers that have no other natural gas Secretary. pipeline facilities accessing their areas [FR Doc. 03–6029 Filed 3–12–03; 8:45 am] (sole source customers) and that DEPARTMENT OF ENERGY BILLING CODE 6717–01–P curtailment of these customers could potentially result in adverse Federal Energy Regulatory consequences to these shippers. Commission DEPARTMENT OF ENERGY Great Lakes states that under section [Docket No. RP03–256–001] 11.4 of the general terms and conditions Federal Energy Regulatory of its Tariff, all Category A firm shippers Honeoye Storage Corporation; Notice Commission are curtailed equally pro-rata based of Proposed Change in FERC Gas [Docket No. CP01–422–004] upon scheduled nominations. Great Tariff Lakes states further that its Tariff does Kern River Gas Transmission not address service to a shipper serving March 6, 2003. Company; Notice of Compliance Filing a sole source customer except insofar as Take notice that on February 28, 2003 that shipper meets the definitions for Honeoye Storage Corporation (Honeoye) March 6, 2003. Category A. tendered for filing as part of its FERC Take notice that on February 28, 2003, Great Lakes states that the requested Gas Tariff, First Revised Volume 1A, a Kern River Gas Transmission Company waiver will permit Great Lakes to ensure revised tariff sheet to be effective April (Kern River) tendered for filing as part service to those communities and 1, 2003. The revised tariff sheet is of its FERC Gas Tariff, Second Revised industrial customers whose supply must designated as:Second Revised Sheet No. Volume No. 1, the following tariff be delivered by means of Great Lakes’ 105 Superseding First Revised Sheet No. sheets, to be effective May 1, 2003: facilities and that the waiver will have 105 Sixth Revised Sheet No. 5–A. a de minimus impact on the remaining Honeoye states that the purpose of the Third Revised Sheet No. 109. shippers whose capacity is affected by filing is to substitute the above reference Third Revised Sheet No. 110. the force majeure event and whose tariff sheet to correct an incorrect Second Revised Sheet No. 110–A. capacity is curtailed. heading that was contained in its filing Original Sheet No. 110–A.1. Any person desiring to be heard or to made on February 14, 2003. The text of Second Revised Sheet No. 110–B. protest said filing should file a motion Tariff Sheet No.105 is unchanged. First Revised Sheet No. 110–C. to intervene or a protest with the Honeoye states that copies of the filing Kern River states that the purpose of Federal Energy Regulatory Commission, are being mailed to Honeoye’s this filing is to comply with the 888 First Street, NE., Washington, DC jurisdictional customers and interested Preliminary Determination on Non- 20426, in accordance with sections state regulatory agencies. Environmental Issues dated February 385.214 or 385.211 of the Commission’s Any person desiring to be heard or to 27, 2002, in Docket No. CP01–422. rules and regulations. All such motions protest said filing should file a motion Kern River states that it has served a or protests must be filed in accordance to intervene or a protest with the copy of this filing upon its customers, with section 154.210 of the Federal Energy Regulatory Commission, interested state regulatory commissions, Commission’s regulations. Protests will 888 First Street, NE., Washington, DC and intervenors on the official service be considered by the Commission in 20426, in accordance with Sections list for Docket No. CP01–422. determining the appropriate action to be 385.314 or 385.211 of the Commission’s Any person desiring to protest said taken, but will not serve to make Rules and Regulations. All such motions filing should file a protest with the protestants parties to the proceedings. or protests must be filed in accordance Federal Energy Regulatory Commission,

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888 First Street, NE., Washington, DC DEPARTMENT OF ENERGY automatically without further order or 20426, in accordance with Section notice by the Commission, unless the 385.211 of the Commission’s Rules and Federal Energy Regulatory Commission orders otherwise. Commission Regulations. All such protests must be If the project is not subject to section filed in accordance with Section [Project No. 2852] 15 of the FPA, notice is hereby given 154.210 of the Commission’s that New York State Electric & Gas New York State Electric & Gas Regulations. Protests will be considered Corporation is authorized to continue Corporation; Notice of Authorization by the Commission in determining the operation of the Keuka Project No. 2852 for Continued Project Operation appropriate action to be taken, but will until such time as the Commission acts not serve to make protestants parties to March 6, 2003. on its application for subsequent the proceedings. This filing is available On February 27, 2001, New York license. for review at the Commission in the Electric & Gas Corporation, licensee for Public Reference Room or may be the Keuka Project No. 2852, filed an Magalie R. Salas, viewed on the Commission’s Web site at application for a nonpower license Secretary. http://www.ferc.gov using the ‘‘FERRIS’’ pursuant to the Federal Power Act [FR Doc. 03–6027 Filed 3–12–03; 8:45 am] link. Enter the docket number excluding (FPA) and the Commission’s regulations BILLING CODE 6717–01–P the last three digits in the docket thereunder. Project No. 2852 is located number field to access the document. between Waneta Lake and Lamoka Lake For assistance, please contact FERC impoundments, and Keuka Lake in DEPARTMENT OF ENERGY Online Support at Steuben and Schuyler Counties, New [email protected] or toll- York. Federal Energy Regulatory free at (866) 208–3676, or TTY, contact The license for Project No. 2852 was Commission (202) 502–8659. The Commission issued for a period ending February 28, 2003. Section 15(a)(1) of the FPA, 16 strongly encourages electronic filings. [Project No. 2659–011] U.S.C. 808(a)(1), requires the See 18 CFR 385.2001(a)(1)(iii) and the Commission, at the expiration of a PacifiCorp; Notice of Meeting To instructions on the Commission’s Web license term, to issue from year to year site under the ‘‘e-Filing’’ link. Discuss Settlement Negotiations and an annual license to the then licensee Surrender Application Protest Date: March 12, 2003. under the terms and conditions of the prior license until a new license is March 6, 2003. Magalie R. Salas, issued, or the project is otherwise a. Date and Time of Meeting: March Secretary. disposed of as provided in section 15 or 17, 2003; 10 a.m. Pacific Standard Time. [FR Doc. 03–6019 Filed 3–12–03; 8:45 am] any other applicable section of the FPA. BILLING CODE 6717–01–P If the project’s prior license waived the b. Place: Conference Call. applicability of section 15 of the FPA, c. FERC Contact: Bob Easton at then, based on section 9(b) of the [email protected] or (202) 502– DEPARTMENT OF ENERGY Administrative Procedure Act, 5 U.S.C. 6045. 558(c), and as set forth at 18 CFR Federal Energy Regulatory 16.21(a), if the licensee of such project d. Purpose of Meeting: PacifiCorp and Commission has filed an application for a subsequent various stakeholders have requested a license, the licensee may continue to meeting with Commission staff to [Docket No. CP03–51–000] operate the project in accordance with discuss ongoing settlement negotiations the terms and conditions of the license which are anticipated to result in filing Natural Gas Pipeline Company of after the minor or minor part license of a surrender application for the America; Errata Notice expires, until the Commission acts on Powerdale Project (P–2659–011) in late its application. If the licensee of such a March or early April 2003. The project March 6, 2003. project has not filed an application for is located on the Hood River in Hood In the Commission’s Notice of a subsequent license, then it may be River, Oregon. Application issued February 24, 2003, required, pursuant to 18 CFR 16.21(b), e. Proposed Agenda: (1) Introduction in the above proceeding, on page 1, to continue project operations until the of participants, (2) PacifiCorp/ paragraph 3 of the notice, in the last Commission issues someone else a stakeholder presentation on negotiations license for the project or otherwise sentence, change ‘‘requests’’ to ‘‘does and/or application, (3) Discussion, and not request’’. The sentence should read: orders disposition of the project. If the project is subject to section 15 (5) Close Meeting. ‘‘Natural states that the cost of the of the FPA, notice is hereby given that f. All local, state, and federal agencies, project is approximately $2.8 million an annual license for Project No. 2852 Indian tribes, and other interested and Natural does not request rolled-in is issued to New York State Electric & parties are invited to join the conference rate treatment for the new facilities’’. Gas Corporation for a period effective call. Please call Bob Easton at (202) 502– Magalie R. Salas, March 1, 2003, through February 29, 6045 at least one day in advance for Secretary. 2004, or until the issuance of a new instructions on how to join the license for the project or other [FR Doc. 03–6020 Filed 3–12–03; 8:45 am] conference call. disposition under the FPA, whichever BILLING CODE 6717–01–P comes first. If issuance of a new license Magalie R. Salas, (or other disposition) does not take Secretary. place on or before March 1, 2004, notice [FR Doc. 03–6026 Filed 3–12–03; 8:45 am] is hereby given that, pursuant to 18 CFR BILLING CODE 6717–01–P 16.18(c), an annual license under section 15(a)(1) of the FPA is renewed

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DEPARTMENT OF ENERGY Comment Date: March 17, 2003. Support at [email protected] or toll- Magalie R. Salas, Federal Energy Regulatory free at (866) 208–3676, or TTY, contact Commission Secretary. (202) 502–8659. The Commission [FR Doc. 03–6037 Filed 3–12–03; 8:45 am] strongly encourages electronic filings. BILLING CODE 6717–01–P [Docket No. RP99–518–036] See 18 CFR 385.2001(a)(1)(iii) and the instructions on the Commission’s Web PG&E Transmission, Northwest site under the ‘‘e-Filing’’ link. DEPARTMENT OF ENERGY Corporation; Notice of Proposed Comment Date: March 17, 2003. Change in FERC Gas Tariff Federal Energy Regulatory Magalie R. Salas, Commission March 6, 2003. Secretary. [Docket No. RP99–513–024] [FR Doc. 03–6036 Filed 3–12–03; 8:45 am] Take notice that on March 3, 2003, BILLING CODE 6717–01–P PG&E Gas Transmission, Northwest Questar Pipeline Company; Notice of Corporation (GTN) tendered for filing Tariff Filing Fifth Revised Sheet No. 15, Second DEPARTMENT OF ENERGY Revised Sheet No. 19, and First Revised March 6, 2003. Sheet No. 20 to be part of its FERC Gas Take notice that on March 3, 2003, Federal Energy Regulatory Tariff, Second Revised Volume No. 1–A. pursuant to 18 CFR 154.7 and 154.203, Commission and as provided by section 30 GTN states that these sheets are being [Docket No. RP03–293–000] filed to reflect the implementation of (Negotiated Rates) to the General Terms four negotiated rate agreements and the and Conditions of part 1 of Questar Southern Natural Gas Company; removal of three negotiated rate Pipeline Company’s (Questar) FERC Gas Notice of Proposed Changes to FERC agreements that have expired. GTN Tariff, Questar submitted a tariff filing Gas Tariff to implement negotiated-rate contracts requests that the Commission accept the for Dominion Exploration & Production, March 6, 2003. proposed tariff sheets to be effective Inc., and BP Energy Company as Take notice that on February 28, 2003, March 1, 2003. authorized by Commission orders Southern Natural Gas Company GTN further states that a copy of this issued October 27, 1999, and December (Southern) tendered for filing the filing has been served on GTN’s 14, 1999, in Docket Nos. RP99–513, et following tariff sheets to its FERC Gas jurisdictional customers and interested al. Tariff, First Revised Volume No. 2A state regulatory agencies. Questar requested waiver of 18 CFR (Volume 2A): Any person desiring to be heard or to 154.207 so that Twenty-Fifth Revised Effective April 1, 2003. protest said filing should file a motion Sheet No. 7 to First Revised Volume No. Cover Sheet. to intervene or a protest with the 1 of its FERC Gas Tariff may become Second Revised Sheet No. 1. effective March 1, 2003. Second Revised Sheet No. 2. Federal Energy Regulatory Commission, Questar states that a copy of this filing Second Revised Sheet No. 38. 888 First Street, NE., Washington, DC has been served upon all parties to this Effective October 1, 2000. 20426, in accordance with Sections proceeding, Questar’s customers, the First Revised Sheet No. 107. 385.314 or 385.211 of the Commission’s Public Service Commission of Utah and The proposed tariff sheets cancel rate Rules and Regulations. All such motions the Public Service Commission of schedules CSS–1, CSS–2 and ST–1 in or protests must be filed in accordance Wyoming. Volume 2A of Southern’s tariff. By order with Section 154.210 of the Any person desiring to be heard or to dated January 30, 2003, in Docket No. Commission’s Regulations. Protests will protest said filing should file a motion CP03–21, the Commission authorized be considered by the Commission in to intervene or a protest with the the abandonment of the storage services. determining the appropriate action to be Federal Energy Regulatory Commission, The storage services associated with taken, but will not serve to make 888 First Street, NE., Washington, DC these rate schedules were abandoned protestants parties to the proceedings. 20426, in accordance with Sections upon the termination of the primary Any person wishing to become a party 385.314 or 385.211 of the Commission’s term of the contracts relating to these must file a motion to intervene. This Rules and Regulations. All such motions services. filing is available for review at the or protests must be filed in accordance Any person desiring to be heard or to Commission in the Public Reference with Section 154.210 of the protest said filing should file a motion Room or may be viewed on the Commission’s Regulations. Protests will to intervene or a protest with the Commission’s Web site at http:// be considered by the Commission in Federal Energy Regulatory Commission, www.ferc.gov using the ‘‘FERRIS’’ link. determining the appropriate action to be 888 First Street, NE., Washington, DC Enter the docket number excluding the taken, but will not serve to make 20426, in accordance with Sections last three digits in the docket number protestants parties to the proceedings. 385.314 or 385.211 of the Commission’s field to access the document. For Any person wishing to become a party Rules and Regulations. All such motions assistance, please contact FERC Online must file a motion to intervene. This or protests must be filed in accordance filing is available for review at the with Section 154.210 of the Support at Commission in the Public Reference Commission’s Regulations. Protests will [email protected] or toll- Room or may be viewed on the be considered by the Commission in free at (866) 208–3676, or TTY, contact Commission’s Web site at http:// determining the appropriate action to be (202) 502–8659. The Commission www.ferc.gov using the ‘‘FERRIS’’ link. taken, but will not serve to make strongly encourages electronic filings. Enter the docket number excluding the protestants parties to the proceedings. See 18 CFR 385.2001(a)(1)(iii) and the last three digits in the docket number Any person wishing to become a party instructions on the Commission’s Web field to access the document. For must file a motion to intervene. This site under the ‘‘e-Filing’’ link. assistance, please contact FERC Online filing is available for review at the

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Commission in the Public Reference Public Reference Room or may be must file a motion to intervene. This Room or may be viewed on the viewed on the Commission’s Web site at filing is available for review at the Commission’s Web site at http:// http://www.ferc.gov using the ‘‘FERRIS’’ Commission in the Public Reference www.ferc.gov using the ‘‘FERRIS’’ link. link. Enter the docket number excluding Room or may be viewed on the Enter the docket number excluding the the last three digits in the docket Commission’s Web site at http:// last three digits in the docket number number field to access the document. www.ferc.gov using the ‘‘FERRIS’’ link. field to access the document. For For assistance, please contact FERC Enter the docket number excluding the assistance, please contact FERC Online Online Support at last three digits in the docket number Support at [email protected] or toll- field to access the document. For [email protected] or toll- free at (866) 208–3676, or TTY, contact assistance, please contact FERC Online free at (866) 208–3676, or TTY, contact (202) 502–8659. The Commission Support at (202) 502–8659. The Commission strongly encourages electronic filings. [email protected] or toll- strongly encourages electronic filings. See 18 CFR 385.2001(a)(1)(iii) and the free at (866) 208–3676, or TTY, contact See 18 CFR 385.2001(a)(1)(iii) and the instructions on the Commission’s Web (202) 502–8659. The Commission instructions on the Commission’s Web site under the ‘‘e-Filing’’ link. strongly encourages electronic filings. site under the ‘‘e-Filing’’ link. Protest Date: March 12, 2003. See 18 CFR 385.2001(a)(1)(iii) and the Comment Date: March 12, 2003. Magalie R. Salas, instructions on the Commission’s Web site under the ‘‘e-Filing’’ link. Magalie R. Salas, Secretary. Comment Date: March 12, 2003. Secretary. [FR Doc. 03–6022 Filed 3–12–03; 8:45 am] [FR Doc. 03–6035 Filed 3–12–03; 8:45 am] BILLING CODE 6717–01–P Magalie R. Salas, BILLING CODE 6717–01–P Secretary. [FR Doc. 03–6033 Filed 3–12–03; 8:45 am] DEPARTMENT OF ENERGY BILLING CODE 6717–01–P DEPARTMENT OF ENERGY Federal Energy Regulatory Commission Federal Energy Regulatory DEPARTMENT OF ENERGY Commission [Docket No. RP03–291–000] Federal Energy Regulatory [Docket No. GT02–35–004] Viking Gas Transmission Company; Commission Notice of Filing Tennessee Gas Pipeline Company; [Docket No. RP03–292–000] Notice of Compliance Tariff Filing March 6, 2003. Take notice that on February 28, 2003, Viking Gas Transmission Company; March 6, 2003. Notice of Filing Take notice that on February 28, 2003, Viking Gas Transmission Company Tennessee Gas Pipeline Company (Viking) tendered for filing as part of its March 6, 2003. (Tennessee), Nine Greenway Plaza, FERC Gas Tariff, First Revised Volume Take notice that on February 28, 2003, Houston, Texas 77046, tendered for No. 1 the following tariff sheet to Viking Gas Transmission Company filing and acceptance by the Federal become effective April 1, 2003: (Viking) tendered for filing as part of its Energy Regulatory Commission Third Revised Sheet No. 5H. FERC Gas Tariff, First Revised Volume (Commission) the tariff sheets listed in Fourteenth Revised Sheet No. 6B. No. 1 the tariff sheets listed on Appendix A for inclusion in The purpose of this filing is to make Appendix A to become effective April 1, Tennessee’s FERC Gas Tariff, Fifth Viking’s annual adjustment to its Load 2003. Revised Volume No. 1. Management Cost Reconciliation The purpose of this filing is to make Tennessee states that the revised tariff Adjustment in accordance with Section Viking’s annual adjustment to its Fuel sheets are being filed in accordance 154.403 of the Commission’s Rules and and Loss Retention Percentages with the Commission’s January 29, Regulations, 18 CFR 154.403, and (‘‘FLRP’’) in accordance with Section 2003, order in the referenced section 27 of the General Terms and 154.403 of the Commission’s Rules and proceeding, which relates to Conditions of Viking’s FERC Gas Tariff. Regulations, 18 CFR 154.403 (2001) and Tennessee’s previous filings to revise Viking states that copies of the filing section 26 of the General Terms and certain of its tariff provisions that have been mailed to all of its Conditions of Viking’s FERC Gas Tariff. primarily deal with the demonstration jurisdictional customers and to affected Application of section 26 of Viking’s and maintenance of creditworthiness by state regulatory commissions. tariff results in the following new Fuel Tennessee’s customers. Any person desiring to be heard or to and Loss Retention Percentages for Rate Any person desiring to protest said protest said filing should file a motion Schedules FT–A, FT–B, FT–C, FT–D, IT filing should file a protest with the to intervene or a protest with the and AOT respectively: 2.37 percent for Federal Energy Regulatory Commission, Federal Energy Regulatory Commission, Zone 1–1, 2.90 percent for Zone 1–2, 888 First Street, NE., Washington, DC 888 First Street, NE., Washington, DC and .58 percent for Zone 2–2. 20426, in accordance with Section 20426, in accordance with Sections Viking states that copies of the filing 385.211 of the Commission’s Rules and 385.314 or 385.211 of the Commission’s have been mailed to all of its Regulations. All such protests must be Rules and Regulations. All such motions jurisdictional customers and to affected filed in accordance with Section or protests must be filed in accordance state regulatory commissions. 154.210 of the Commission’s with Section 154.210 of the Any person desiring to be heard or to Regulations. Protests will be considered Commission’s Regulations. Protests will protest said filing should file a motion by the Commission in determining the be considered by the Commission in to intervene or a protest with the appropriate action to be taken, but will determining the appropriate action to be Federal Energy Regulatory Commission, not serve to make protestants parties to taken, but will not serve to make 888 First Street, NE., Washington, DC the proceedings. This filing is available protestants parties to the proceedings. 20426, in accordance with Sections for review at the Commission in the Any person wishing to become a party 385.314 or 385.211 of the Commission’s

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Rules and Regulations. All such motions 2. New England Power Pool 5. PacifiCorp or protests must be filed in accordance [Docket No. ER03–210–003] [Docket No. ER03–582–000] with Section 154.210 of the Commission’s Regulations. Protests will Take notice that on March 3, 2003, Take notice that on March 3, 2003, be considered by the Commission in ISO New England Inc., submitted a PacifiCorp tendered for filing in determining the appropriate action to be Report of Compliance in response to the accordance with 18 CFR 35 of the taken, but will not serve to make January 31, 2003 order issued by the Commission’s Rules and Regulations, protestants parties to the proceedings. Federal Energy Regulatory Commission the 2002–03 Operating Procedures Any person wishing to become a party in the above-referenced docket. under the Pacific Northwest must file a motion to intervene. This ISO New England Inc., states that Coordination Agreement. copies of this filing have been served filing is available for review at the PacificCorp states that copies of this upon NEPOOL Participants and the Commission in the Public Reference filing were supplied to the parties to the utility regulatory agencies of the six Room or may be viewed on the Pacific Northwest Coordination New England States. Commission’s Web site at http:// Agreement. www.ferc.gov using the ‘‘FERRIS’’ link. Comment Date: March 24, 2003. Comment Date: March 24, 2003. Enter the docket number excluding the 3. Westar Energy, Inc. last three digits in the docket number 6. Entergy Services, Inc., et al. [Docket ER03–578–000] field to access the document. For [Docket No. ER03–583–000] assistance, please contact FERC Online Take notice that on March 3, 2003, Support at Kansas Gas & Electric Company, Inc. Take notice that on March 3, 2003, [email protected] or toll- and Westar Energy, Inc. (collectively Entergy Services, Inc. (ESI), on behalf of free at (866) 208–3676, or TTY, contact Westar) submitted for filing a Notice of the Entergy Operating Companies, and (202) 502–8659. The Commission Cancellation for Rate Schedule FERC EWO Marketing LP (EWOM), an strongly encourages electronic filings. Nos. 166, 167, 210, 212 and 246, service affiliated marketer, filed under section See 18 CFR 385.2001(a)(1)(iii) and the agreements between Westar and the City 205 of the Federal Power Act for instructions on the Commission’s Web of Iola, Kansas; City of Fredonia, approval of two power purchase site under the ‘‘e-Filing’’ link. Kansas; City of Waterville, Kansas; City agreements between the Entergy Comment Date: March 12, 2003. of Scranton, Kansas; and City of Alma, Operating Companies and EWOM. ESI Kansas. and EWOM seek an effective date of Magalie R. Salas, Westar states that copies of this filing April 30, 2003. Secretary. were served on the City of Iola, Kansas; ESI states that copies of this filing [FR Doc. 03–6034 Filed 3–12–03; 8:45 am] City of Fredonia, Kansas; City of were served on the affected state utility Waterville, Kansas; City of Scranton, BILLING CODE 6717–01–P commissions. Kansas; City of Alma, Kansas and the Kansas Corporation Commission. Comment Date: March 24, 2003. DEPARTMENT OF ENERGY Comment Date: March 24, 2003. 7. Citizens Communications Company 4. Northern States Power Company [Docket No. ER03–584–000] Federal Energy Regulatory (Minnesota), Northern States Power Commission Take notice that on March 3, 2003, Company, (Wisconsin) Citizens Communications Company [Docket No. ER03–579–000] (Citizens) tendered for filing in the [Docket No. ER03–171–004, et al.] Take notice that on March 3, 2003 above-referenced docket, Rate Entergy Mississippi, Inc., et al.; Northern States Power Company Schedules 45 and 46 applicable to sales- Electric Rate and Corporate Filings (Minnesota), and Northern States Power for-resale service to Mohave Electric Company (Wisconsin) jointly tendered Cooperative March 5, 2003. for filing revised tariffs sheets to NSP Comment Date: March 24, 2003. The following filings have been made Electric Rate Schedule FERC No. 2, contained in Xcel Energy Operating 8. Deseret Generation & Transmission with the Commission. The filings are Co-operative, Inc. listed in ascending order within each Companies FERC Electric Tariff, docket classification. Original Volume Number 3. The revised [Docket No. ER03–585–000] tariff sheets provide the annual update Take notice that on March 3, 2003 1. Entergy Mississippi, Inc. to Exhibits VII, VIII, and IX of the Deseret Generation & Transmission Co- Restated Agreement to Coordinate [Docket Nos. ER03–171–004 and ER03–589– operative, Inc. (Deseret) tendered for Planning and Operations and 000] filing an amendment to First Revised Interchange Power and Energy between Service Agreement No. 5 under Take notice that on March 3, 2003, Northern States Power Company Deseret’s FERC Electric Tariff, Original Entergy Services, Inc., on behalf of (Minnesota) and Northern States Power Volume 1. The amendment includes a Entergy Mississippi, Inc., tendered for Company (Wisconsin), accepted for second amended and restated Wholesale filing with the Federal Energy filing in Docket No. ER02–808–000. The Power Agreement For Large Industrial Regulatory Commission (Commission), NSP Companies request an effective Loads (Implementing Deseret Rate compliance Interconnection Agreement date of January 1, 2003, without Schedule ML–COG1) between Deseret pages addressing the interconnection of suspension. South Mississippi Electric Power and Moon Lake Electric Association, The NSP Companies state that a copy Inc. Association’s Silver Creek generating of the filing has been served upon the facility, in response to the Commission’s State Commissions of Michigan, Deseret states that copies of this filing January 31, 2003, order in Entergy Minnesota, North Dakota, South Dakota have been served upon Deseret’s Mississippi, Inc., 102 FERC ¶61,105. and Wisconsin. member cooperatives. Comment Date: March 24, 2003. Comment Date: March 24, 2003. Comment Date: March 24, 2003.

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9. New York State Electric & Gas DEPARTMENT OF ENERGY submitted its Report of Compliance in Corporation response to the requirements of the Federal Energy Regulatory Commission’s January 31, 2003, Order [Docket Nos. ER03–587–000] Commission in New England Power Pool, 102 FERC Take notice that on March 3, 2003, [Docket No. EL02–88–002, et al.] ¶ 61,107. New York State Electric & Gas NEPOOL states that copies of these Corporation (NYSEG) tendered for filing Entergy Services, Inc., et al.; Electric materials were sent to the New England revisions to its revised retail tariff leaves Rate and Corporate Filings state governors and regulatory relating to borderline sales. NYSEG’s commissions and the Participants in March 6, 2003. borderline sales contracts and prior NEPOOL. The following filings have been made Comment Date: March 24, 2003. revisions thereto are part of FERC Rate with the Commission. The filings are Schedules No. 30, 27, 28, 30, 32, 33, and listed in ascending order within each 4. New York Independent System 105. docket classification. Operator, Inc. NYSEG states that copies of the filing 1. Entergy Services, Inc. [Docket No. ER03–238–002] have been served on all parties listed on Take notice that on February 14, 2003, the New York State Public Service [Docket Nos. EL02–88–002, ER02–1069–004, New York Independent System Commission and on the Borderline ER02–1151–004, ER02–1472–004, and ER02– 2243–004] Operator, Inc., (NYISO) submitted for Utilities. filing an explanation of the non- Take notice that on February 28, 2003, applicability of day-ahead margin Comment Date: March 24, 2003. Entergy Services, Inc., on behalf of asurance payments to off-dispatch Entergy Arkansas, Inc., Entergy Gulf Standard Paragraph generators under certain conditions, States, Inc., Entergy Louisiana, Inc., and pursuant to the Commission’s January Any person desiring to intervene or to Entergy Mississippi, Inc., tendered for 30, 2003, Order in this proceeding. protest this filing should file with the filing with the Federal Energy Comment Date: March 17, 2003. Federal Energy Regulatory Commission, Regulatory Commission (Commission), 888 First Street, NE., Washington, DC compliance interconnection and 5. Washington County Power, LLC 20426, in accordance with Rules 211 operating agreements with Wrightsville [Docket No. ER03–398–001] and 214 of the Commission’s Rules of Power Facility, LLC, Plum Point Energy Associates, LLC, Cottonwood Energy Take notice that on March 4, 2003, Practice and Procedure (18 CFR 385.211 Washington County Power, LLC and 385.214). Protests will be Company, LP, Washington Parish Energy Center, LLC, and Reliant Energy (Washington) tendered for filing an considered by the Commission in amendment to its market-based rate determining the appropriate action to be Choctaw County, LLC, in response to the Commission’s January 28, 2003, and tariff (MBR Tariff) filed in the above- taken, but will not serve to make captioned proceeding. Washington protestants parties to the proceeding. February 26, 2003, order in Wrightsville Power Facility, L.L.C., v. Entergy requests that the Federal Energy Any person wishing to become a party Arkansas, Inc., et al., 102 FERC ¶ 61,170 Regulatory Commission make its MBR must file a motion to intervene. All such and 102 FERC ¶ 61,212. Tariff, as amended, effective on March motions or protests should be filed on Comment Date: March 21, 2003. 11, 2003. or before the comment date, and, to the Comment Date: March 25, 2003. extent applicable, must be served on the 2. Kinder Morgan Michigan, LLC v. 6. Klondike Wind Power LLC applicant and on any other person Michigan Electric Transmission designated on the official service list. Company, LLC [Docket No. ER03–416–003] This filing is available for review at the [Docket No. EL03–12–002] Take notice that on March 3, 2003, Commission or may be viewed on the Take notice that on February 28, 2003, Klondike Wind Power LLC amended its Commission’s Web site at http:// Michigan Electric Transmission January 15, 2003, name change filing www.ferc.gov , using the ‘‘FERRIS’’ link. Company, LLC (METC) submitted for with the Federal Energy Regulatory Enter the docket number excluding the filing with the Federal Energy Commission (Commission), which last three digits in the docket number Regulatory Commission (Commission) a informed the Commission that on filed to access the document. For Generator Interconnection & Operating December 19, 2002, the name of ‘‘West assistance, contact FERC Online Agreement with Kinder Morgan Valley Generation LLC’’ had been Support at Michigan, LLC in compliance with the changed to ‘‘Klondike Wind Power [email protected] or toll- January 29, 2003, Commission Order in LLC’’ in accordance with 18 CFR 35.16. The amendment reflects the addition of free at (866) 208–3676, or for TTY, Docket Nos. ER02–1330, et al. In a notice of succession filed under 18 contact (202) 502–8659. Protests and addition to submitting the changes directed by the Commission, METC also CFR 131.51. interventions may be filed electronically Comment Date: March 24, 2003. via the Internet in lieu of paper; see 18 made ministerial changes to the CFR 385.2001(a)(1)(iii) and the agreement. 7. PPM Energy, Inc. METC states that a copy was served instructions on the Commission’s Web on all parties compiled on the official [Docket No. ER03–478–001] site under the ‘‘e-Filing’’ link. The service list in Docket No. EL03–12, as Take notice that on March 3, 2003, Commission strongly encourages well as the Michigan Public Service PPM Energy, Inc. amended its January electronic filings. Commission. 30, 2003, name change filing with the Magalie R. Salas, Comment Date: March 31, 2003. Federal Energy Regulatory Commission (Commission), which informed the Secretary. 3. New England Power Pool Commission that on January 15, 2003, [FR Doc. 03–6021 Filed 3–12–03; 8:45 am] [Docket No. ER03–210–004] the name of ‘‘PacifiCorp Power BILLING CODE 6717–01–P Take notice that on March 3, 2003, the Marketing, Inc.’’ had been changed to New England Power Pool (NEPOOL) ‘‘PPM Energy, Inc.’’ in accordance with

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18 CFR 35.16. The amendment reflects respectively, (collectively, the Policies). interventions may be filed electronically the addition of a Notice of Succession NEPOOL states that the changes to the via the Internet in lieu of paper; see 18 filed under 18 CFR 131.51. Policies: (i) Reflect NEPOOL’s CFR 385.2001(a)(1)(iii) and the Comment Date: March 24, 2003. experience with the Policies that were instructions on the Commission’s Web implemented in 2002; (ii) account for site under the ‘‘e-Filing’’ link. The 8. New England Power Pool certain other financial assurance issues Commission strongly encourages [Docket No. ER03–586–000] that have arisen since the electronic filings. Take notice that on February 28, 2003, implementation of the revised Policies; Magalie R. Salas, Northeast Utilities Service Company and (iii) make changes to the Policies in (NUSCO), on behalf of its operating connection with the upcoming Secretary. company affiliates, The Connecticut implementation of Standard Market [FR Doc. 03–6002 Filed 3–12–03; 8:45 am] Light and Power Company, Western Design in New England. A May 1, 2003, BILLING CODE 6717–01–P Massachusetts Electric Company, effective date is requested for these Holyoke Power and Electric Company changes. DEPARTMENT OF ENERGY and Holyoke Water Power Company NEPOOL states that copies of these (the NU Companies) submitted for filing materials were sent to the NEPOOL Participants, Non-Participant Federal Energy Regulatory an amendment (Amendment) to the Commission Settlement Agreement approved by the Transmission Customers and the New Commission in Northeast Utilities England state governors and regulatory [Docket No. EC03–30–000, et al.] Service Company, 88 FERC ¶ 61,006 commissions. (the Settlement) to extend the rates, Comment Date: March 25, 2003. Illinois Power Company, et al.; Electric Rate and Corporate Filings terms and conditions of the Settlement 11. PJM Interconnection, L.L.C. for a period of 90 days. [Docket No. ES03–26–000] March 7, 2003. NUSCO states that a copy of this filing Take notice that on February 28, 2003, The following filings have been made has been mailed to the service list. with the Commission. The filings are Comment Date: March 11, 2003. PJM Interconnection, L.L.C. (PJM) submitted an application pursuant to listed in ascending order within each 9. California Independent System section 204 of the Federal Power Act docket classification. Operator Corporation seeking authorization to issue a long- 1. Illinois Power Company; Illinois [Docket No. ER03–588–000] term, secured note in the amount of Electric Transmission Company, LLC; $110 million. Trans-Elect, Inc. Take notice that on March 4, 2003, the PJM also requests a waiver from the California Independent System Operator Commission’s competitive bidding and [Docket Nos. EC03–30–000 and ER03–284– Corporation (ISO) submitted for negotiated placement requirements at 18 000] Commission filing and acceptance the CFR 34.2. Take notice that on March 4, 2003, Utility Distribution Company Operating Comment Date: March 27, 2003. Illinois Power Company (Illinois Agreement (UDC Operating Agreement) Power), and Illinois Electric between the ISO and the City of Standard Paragraph Transmission Company, LLC (IETC), Hercules, California. The ISO requests Any person desiring to intervene or to Illinois Transco-Holdings, LP (ITH) and that the UDC Operating Agreement be protest this filing should file with the Trans-Elect, Inc. (Trans-Elect) made effective as of March 1, 2003. The Federal Energy Regulatory Commission, (collectively Trans-Elect applicants) ISO requests privileged treatment, 888 First Street, NE., Washington, DC (collectively applicants) withdrew that pursuant to 18 CFR 388.112, with regard 20426, in accordance with rules 211 and portion of the joint application filed by to portions of the filing. 214 of the Commission’s rules of applicants on December 16, 2002, in The ISO states that it has served practice and procedure (18 CFR 385.211 which Trans-Elect applicants requested copies of this filing upon the City of and 385.214). Protests will be authorization under section 205 of the Hercules, California and the California considered by the Commission in Federal Power Act for certain rate Public Utilities Commission. determining the appropriate action to be methodologies and treatments for the Comment Date: March 25, 2003. taken, but will not serve to make provision of open access transmission 10. New England Power Pool protestants parties to the proceeding. service over the jurisdictional Any person wishing to become a party transmission facilities to be purchased [Docket No. ER03–590–000] must file a motion to intervene. All such from Illinois Power by IETC. Take notice that on March 4, 2003, the motions or protests should be filed on Applicants state that copies of this New England Power Pool (NEPOOL) or before the comment date, and, to the filing have been served on all affected submitted the Ninety-Fourth Agreement extent applicable, must be served on the state commissions and customers taking Amending New England Power Pool applicant and on any other person service under Illinois Power’s open Agreement, which modifies and clarifies designated on the official service list. access transmission tariff. Attachments L, M, N, and O, of the This filing is available for review at the Comment Date: March 25, 2003. Commission or may be viewed on the Restated NEPOOL Open Access 2. NSTAR Electric & Gas Corporation, Commission’s Web site at http:// Transmission Tariff (the NEPOOL et al. v. New England Power Pool Tariff), the Financial Assurance Policy www.ferc.gov, using the ‘‘FERRIS’’ link. for NEPOOL Members, the Financial Enter the docket number excluding the [Docket No. EL03–25–002] Assurance Policy for NEPOOL Non- last three digits in the docket number Take notice that on March 3, 2003, the Participant Transmission Customers, the filed to access the document. For New England Power Pool (NEPOOL) NEPOOL Billing Policy, and the assistance, contact FERC Online tendered for filing with the Federal Financial Assurance Policy for Non- Support at Energy Regulatory Commission Participants that transact in the [email protected] or toll- (Commission) its report of compliance Financial Transmission Rights (FTR) free at (866) 208–3676, or for TTY, in response to the requirements of the Auction and/or Secondary FTR Market, contact (202) 502–8659. Protests and Commission’s January 31, 2003, order in

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NSTAR Electric & Gas Corporation, et Commission strongly encourages should follow the instruction for filing al., 102 FERC ¶61,107 (2003). electronic filings. comments described in item l below. NEPOOL states that copies of these l. Deadline for filing comments on the Magalie R. Salas, application: 60 days from date of this materials were sent to the parties to that Secretary. proceeding, to the NEPOOL notice. [FR Doc. 03–6006 Filed 3–12–03; 8:45 am] participants, non-participant All documents (original and eight transmission customers and the New BILLING CODE 6717–01–P copies) should be filed with: Magalie R. England state governors and regulatory Salas, Secretary, Federal Energy commissions. Regulatory Commission, 888 First DEPARTMENT OF ENERGY Street, NE., Washington, DC 20426. Comment Date: March 31, 2003. The Commission’s Rules of Practice Federal Energy Regulatory 3. Wolverine Power Supply require all intervenors filing documents Commission Cooperative, Inc. with the Commission to serve a copy of that document on each person on the Notice of Application Tendered for [Docket No. ES03–27–000] official service list for the project. Filing With the Commission, Soliciting Take notice that on February 28, 2003, Further, if an intervenor files comments Additional Studies Requests, Wolverine Power Supply Cooperative, or documents with the Commission Establishing Procedural Schedule for Inc. (Wolverine) submitted an relating to the merits of an issue that Licensing, and a Deadline for application pursuant to section 204 of may affect the responsibilities of a Submission of Final Amendments the Federal Power Act seeking particular resource agency, they must authorization to make short-term March 6, 2003. also serve a copy of the document on borrowings under a line of credit with Take notice that the following that resource agency. the National Rural Cooperative Finance hydroelectric application has been filed Additional study requests and Corporation in an amount not to exceed with the Commission and is available requests for cooperating agency status $25 million. for public inspection. may be filed electronically via the Wolverine also requests a waiver from a. Type of Application: Original Major Internet in lieu of paper. See 18 CFR the Commission’s competitive bidding License, constructed project. 385.2001(a)(1)(iii) and the instructions on the Commission’s Web site ( http:// and negotiated placement requirements b. Project No.: 11810–004. www.ferc.gov ) under the ‘‘e-Filing’’ at 18 CFR 34.2. c. Date Filed: January 30, 2003. d. Applicant: City of Augusta. link. After logging into the eFiling Comment Date: March 21, 2003. e. Name of Project: Augusta Canal system, select ‘‘Comment on Filing’’ Standard Paragraph Project. from the Filing Type Selection screen f. Location: Adjacent to the Savannah and continue with the filing process. Any person desiring to intervene or to River, in Richmond County, Georgia, The Commission strongly encourages protest this filing should file with the near the town of Augusta, Georgia. The electronic filings. Federal Energy Regulatory Commission, project does not occupy Federal lands. m. This application is not ready for 888 First Street, NE., Washington, DC g. Filed Pursuant to: Federal Power environmental analysis at this time. 20426, in accordance with rules 211 and Act 16 U.S.C. 791(a)–825(r). n. The proposed project description: 214 of the Commission’s rules of h. Applicant: Max Hicks, Director, The City of Augusta does not propose to practice and procedure (18 CFR 385.211 Utilities Department, 360 Bay Street, construct hydroelectric generation and 385.214). Protests will be Suite 180, Augusta, Georgia 30901, (706) facilities and the project would produce considered by the Commission in 312–4121. no power. Augusta is proposing to determining the appropriate action to be i. FERC Contact: Monte TerHaar, (202) license parts of the Augusta Canal taken, but will not serve to make 502–6035 or [email protected]. system which pass flows for use by protestants parties to the proceeding. j. Cooperating agencies: We are asking three existing hydroelectric projects Any person wishing to become a party Federal, state, local, and tribal agencies located in the Augusta Canal. These must file a motion to intervene. All such with jurisdiction and/or special projects are the 1.2 megawatt (MW) motions or protests should be filed on expertise with respect to environmental Enterprise Project (No. 2935), the 2.475 or before the comment date, and, to the issues to cooperate with us in the MW Sibley Mill Project (No. 5044), and extent applicable, must be served on the preparation of the environmental the 2.05 MW King Mill Project (No. applicant and on any other person document. Agencies who would like to 9988). The proposed project would designated on the official service list. request cooperation status should follow consist of the following: (1) the 1,666- This filing is available for review at the the instruction for filing comments foot-long stone-masonry Augusta Commission or may be viewed on the described in item l below. Diversion Dam; (2) the 2,250-foot-long Commission’s Web site at http:// k. Pursuant to section 4.32(b)(7) of 18 Savannah River impoundment between www.ferc.gov, using the ‘‘FERRIS’’ link. CFR of the Commission’s regulations, if Steven’s Creek Dam and the Augusta Enter the docket number excluding the any resource agency, Indian Tribe, or Diversion Dam; and (3) the first level of last three digits in the docket number person believes that an additional the Augusta Canal, which extends about field to access the document. For scientific study should be conducted in 7 miles between the Augusta Diversion assistance, please contact FERC Online order to form an adequate factual basis Dam and the Thirteenth Street gates. Support at for a complete analysis of the o. A copy of the application is [email protected] or toll- application on its merit, the resource available for review at the Commission free at (866) 208–3676, or for TTY, agency, Indian Tribe, or person must file in the Public Reference Room or may be contact (202) 502–8659. Protests and a request for a study with the viewed on the Commission’s Web site at interventions may be filed electronically Commission not later than 60 days from http://www.ferc.gov using the ‘‘FERRIS’’ via the Internet in lieu of paper; see 18 the date of filing of the application, and link. Enter the docket number excluding CFR 385.2001(a)(1)(iii) and the serve a copy of the request on the the last three digits in the docket instructions on the Commission’s Web applicant. Parties who would like to number field to access the document. site under the ‘‘e-Filing’’ link. The request additional scientific studies For assistance, contact FERC Online

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Support at DEPARTMENT OF ENERGY overflow type diversion dam; (2) a [email protected] or toll- radial gate; (3) trash racks; (4) a 19.9 free at 1–866–208–3676, or for TTY, Federal Energy Regulatory acre-foot de-silting pond; (5) an 18 to (202) 502–8659. A copy is also available Commission 26-inch-diameter, 19,300-foot-long steel for inspection and reproduction at the penstock; (5) a 600-kilowatt address in item h above. Notice of Paper Scoping and Soliciting powerhouse; and (6) appurtenant p. With this notice, we are initiating Scoping Comments facilities. m. A copy of the application is on file consultation with the Georgia State March 6, 2003. with the Commission and is available Historic Preservation Officer as required Take notice that the following for public inspection. This filing is by § 106, National Historic Preservation hydroelectric application has been filed available for review at the Commission Act, and the regulations of the Advisory with the Commission and is available or may be viewed on the Commission’s Council on Historic Preservation, 36 for public inspection: CFR, part 800. a. Type of Application: New Minor Web site at http://www.ferc.gov , using q. Procedural schedule: At this time License. the ‘‘FERRIS’’ link. Enter the docket we do not anticipate the need for b. Project No.: 1273–009. number excluding the last three digits in preparing a draft EA. We intend to c. Date filed: November 15, 2002. the docket number field to access the prepare one, multi-project d. Applicant: Parowan City. document. For assistance, contact FERC environmental document which will e. Name of Project: Center Creek Online Support at include the Augusta Canal Project (P– Hydroelectric Project. [email protected] or toll- 11810), the Enterprise Project (P–2935), f. Location: At the confluence of free at (866) 208–3676, or for TTY, and the Sibley Mill Project (P–5044). Center Creek (aka Parowan Creek) and contact (202) 502–8659. A copy is also The EA will include our Bowery Creek (a tributary to Parowan available for inspection and recommendations for operating Creek) near the City of Parowan, in Iron reproduction at the address in item h procedures and environmental County, Utah. The project occupies above. enhancement measures that should be 21.43 acres of land managed by the U.S. n. Scoping Process—Scoping is part of any license issued by the Department of the Interior, Bureau of intended to advise all parties regarding Commission. Recipients will have 60 Land Management. the proposed scope of the days to provide the Commission with g. Filed Pursuant to: Federal Power environmental analysis and to seek any written comments on the EA. All Act 16 U.S.C. 791(a)–825(r). additional information pertinent to this comments filed with the Commission h. Applicant Contact: Alden C. analysis. The Commission intends to will be considered in the Order taking Robinson, P.E., Sunrise Engineering, prepare an environmental assessment (EA) for the project in accordance with final action on the license applications. Inc., 25 East 500 North, Fillmore, Utah the National Environmental Policy Act. However, should substantive comments 84631, (435) 743–6151 and/or Clark The EA will consider both site-specific requiring re-analysis be received on the Gates II, City Manager, Parowan City, and cumulative environmental impacts NEPA document, we would consider PO Box 576, Parowan, Utah 84761, (435) and reasonable alternatives to the preparing a subsequent NEPA 477–3331. proposed action. document. i. FERC Contact: Gaylord Hoisington, (202) 502–6032, At this time, the Commission staff do The application will be processed not propose to conduct any formal according to the following Hydro [email protected]. j. Deadline for filing scoping public or agency meetings or an on-site Licensing Schedule. Revisions to the comments is April 4, 2003. All visit. Instead, we will solicit comments, schedule may be made as appropriate. documents (original and eight copies) recommendations, information, and Scoping Document 1—March 2003 should be filed with: Magalie R. Salas, alternatives by conducting paper Comments on Scoping Document 1— Secretary, Federal Energy Regulatory scoping through issuing Scoping May 2003 Commission, 888 First Street, NE., Document 1 (SD1). Issue acceptance letter/request Washington, DC 20426. Copies of SD1 outlining the subject additional information—May 2003 The Commission’s Rules of Practice areas to be addressed in the EA were Additional Information Due—July 2003 and Procedure require all interveners distributed to the parties on the Notice of ready for environmental filing documents with the Commission Commission’s mailing list. Copies of analysis/Notice soliciting final terms to serve a copy of that document on SD1 are available for review at the and conditions July—2003 each person on the official service list Commission or may be viewed on the Deadline for Agency for the project. Further, if an intervener Commission’s Web site at http:// Recommendations—September 2003 files comments or documents with the www.ferc.gov , using the ‘‘FERRIS’’ link. Notice of the availability of the EA— Commission relating to the merits of an Enter the docket number excluding the November 2003 issue that may affect the responsibilities last three digits in the docket number Public Comments on EA—due January of a particular resource agency, they field to access the document. For 2003 must also serve a copy of the document assistance, contact FERC Online Ready for Commission’s decision on the on that resource agency. Support at application—March 2004 Scoping comments may be filed [email protected] or toll- r. Final amendments to the electronically via the Internet in lieu of free at (866) 208–3676, or for TTY, application must be filed with the paper. See 18 CFR 385.2001(a)(1)(iii) contact (202) 502–8659. Commission no later than 30 days from and the instructions on the As part of scoping the staff will: (1) the issuance date of the notice of ready Commission’s web site, http:// summarize the environmental issues for environmental analysis. www.ferc.gov , under the ‘‘e-Filing’’ tentatively identified for analysis in the link. EA; (2) solicit from comments all Magalie R. Salas, k. This application is not ready for available information, especially Secretary. environmental analysis at this time. quantifiable data, on the resources at [FR Doc. 03–6023 Filed 3–12–03; 8:45 am] l. Description of the Project: (1) a 15- issue; (3) encourage comments from BILLING CODE 6717–01–P foot-high, 54-foot-long concrete experts and the public on issues that

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should be analyzed in the EA, including i. FERC Contact: Randy Yates at (770) n. A copy of the application is viewpoints in opposition to, or in 452–3778, or [email protected]. available for review at the Commission support of, the staff’s preliminary views; j. Deadline for filing comments on the in the Public Reference Room or may be (4) determine the resource issues to be application: 60 days from the filing viewed on the Commission’s Web site at addressed in the EA; and (5) identify date. http://www.ferc.gov using the ‘‘FERRIS’’ those issues that require a detailed All documents (original and eight link. Enter the docket number excluding analysis, as well as those issues that do copies) should be filed with: Magalie R. the last three digits in the docket not require a detailed analysis. Salas, Secretary, Federal Energy number field to access the document. Consequently, interested entities are Regulatory Commission, 888 First For assistance, contact FERC Online requested to file with the Commission Street, NE., Washington, DC 20426. Support at k. Cooperating agencies: We are any data and information concerning [email protected] or toll- asking Federal, state, local, and tribal environmental resources and land uses free at 1–866–208–3676, or for TTY, agencies with jurisdiction and /or in the project area and the subject (202) 502–8659. A copy is also available special expertise with respect to project’s impacts to the aforementioned. for inspection and reproduction at the environmental issues to cooperate with o. The tentative schedule for address in item h above. preparing the Center Creek EA is: us in the preparation of the o. Procedural schedule and final Major Milestone—Target Date environmental document. Agencies who would like to request cooperation status amendments: At this time we anticipate Ready for Environmental Analysis a comprehensive settlement to be Notice—April 23, 2003 should follow the instruction for filing submitted to the Commission and Draft EA Issued—July 16, 2003 comments described in the item j above. therefore we do not anticipate the need Final EA Issued—September 17, 2003 Requests for cooperating agency status may be filed electronically via the for preparing a draft EA. We intend to Note: The schedule is going to vary Internet in lieu of paper. The prepare a single environmental depending upon the circumstances of the Commission strongly encourages document. The EA will include our project (deficiencies, additional information, electronic filings. See 18 CFR recommendations for operating etc.) See Guidance for Publishing Hydro 385.2001(a)(1)(iii) and the instructions procedures and environmental Licensing Schedules. on the Commission’s Web site (http:// enhancement measures that should be Magalie R. Salas, www.ferc.gov ) under the ‘‘e-Filing’’ part of any license issued by the link. Commission. Recipients will have 60 Secretary. l. This application is not ready for days to provide the Commission with [FR Doc. 03–6024 Filed 3–12–03; 8:45 am] environmental analysis at this time. any written comments on the EA. All BILLING CODE 6717–01–P m. The proposed Tapoco Project comments filed with the Commission includes four developments: Santeetlah will be considered in the Order taking Development consisting of: (1)1,054- DEPARTMENT OF ENERGY final action on the license applications. foot-high and 216-foot-high concrete However, should substantive comments Federal Energy Regulatory arch dam; (2) 25,176 foot long tunnel/ requiring reanalysis be received on the Commission pipeline; (3) 2,881-acre reservoir; (4) NEPA document, we would consider powerhouse with two generating units, preparing a subsequent NEPA Notice of Application Tendered for with the total installed capacity of 49.2 document. MW; and (5) 750-foot-long 161 kV Filing With the Commission, The application will be processed Establishing Procedural Schedule for transmission line. Cheoah Development consisting of: according to the following Hydro Relicensing, and a Deadline for Licensing Schedule. Revisions to the Submission of Final Amendments (1) 750-foot-long and 229-foot high curved concrete gravity dam; (2) 644- schedule may be made as appropriate. March 6, 2003. acre reservoir; (3) powerhouse with 4 Issue Acceptance letter—May 2003. Take notice that the following vertical Francis turbine units directly Notice soliciting final terms and hydroelectric application has been filed connected to generators and 1- conditions—May 2003. with the Commission and is available independent Francis turbine unit added for public inspection. in 1949; and (4) 118-MW total installed Deadline for Agency a. Type of Application: New Major capacity. Recommendations—July 2003. License. Calderwood Development consisting Notice of the availability of the EA— b. Project No.: 2169–020. of: (1) 916-foot-long and 230-foot-high November 2003. c. Date Filed: February 21, 2003. concrete arch dam; (2) 570-acre d. Applicant: Alcoa Power Generating reservoir; (3) 2,050-foot-long tunnel; and Public Comments on EA due—January Inc (APGI). (4) powerhouse with 3 Francis turbine 2004. e. Name of Project: Tapoco Project. units, which are being upgraded to a Ready for Commission’s decision on the f. Location: On the Little Tennessee total installed capacity of 140.4 MW. application—July 2004. and Cheoah Rivers in Graham and Chilhowee Development consisting Final amendments to the application Swain Counties, North Carolina and of: (1) 1,483-foot-long and 88.5-foot-high must be filed with the Commission no Blount and Monroe Counties, concrete gravity dam; (2) 1.734-acre later than 45 days from the issuance Tennessee. The project affects Federal reservoir; and (3) powerhouse with 3 date of the notice soliciting final terms lands. Kaplan turbine units with a total and conditions. g. Filed Pursuant to: Federal Power installed capacity of 52.2 MW Act 16 U.S.C. 791(a)–825(r). APGI is planning a refurbishment/ p. With this notice, we are initiating h. Applicant Contact: Mr. Norman L. upgrade at several of the units during consultation with the Tennessee and Pierson, Property and Relicensing the term of the new license and North Carolina State Historic Manager, Alcoa Power Generation Inc., proposes to modify project operations in Preservation Officers as required by Tapoco Division, 300 North Hall Road, connection with the environmental § 106, National Historic Preservation Alcoa, TN 37701–2516, (865) 977.3326. measures described in the application. Act, and the regulations of the Advisory

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Council on Historic Preservation, 36 Further, if an intervenor files comments the Advisory Council on Historic CFR, part 800. or documents with the Commission Preservation, 36 CFR 800.4. relating to the merits of an issue that p. Procedural schedule and final Magalie R. Salas, may affect the responsibilities of a amendments: The application will be Secretary. particular resource agency, they must processed according to the following [FR Doc. 03–6025 Filed 3–12–03; 8:45 am] also serve a copy of the document on milestones, some of which may be BILLING CODE 6717–01–P that resource agency. combined to expedite processing: Additional study requests may be Issue Deficiency Letter—May, 2003. filed electronically via the Internet in DEPARTMENT OF ENERGY Notice of application accepted for lieu of paper. See 18 CFR filing—July, 2003. Federal Energy Regulatory 385.2001(a)(1)(iii) and the instructions Issuance of NEPA Scoping Document 1, Commission on the Commission’s Web site (http:// for comments—August, 2003. www.ferc.gov) under the ‘‘e-Filing’’ link. Request for Additional Information— Notice of Application Tendered for After logging into the e-Filing system, September, 2003. Filing With the Commission, Soliciting selecte ‘‘Comment on Filing’’ from the Issuance of NEPA Scoping Document Additional Study Requests, and Filing Type Selection screen and 2—October, 2003. Establishing Procedures for continue with the filing process. Notice of application is ready for Relicensing and a Deadline for l. This application is not ready for environmental analysis—November, Submission of Final Amendments environmental analysis at this time. 2003. m. The existing Borel Hydroelectric Notice of the availability of the draft March 6, 2003. Project (Project) consists of: (1) 158-foot NEPA document—April, 2004. Take notice that the following long, 4-foot-high concrete diversion dam Notice of the availability of the final hydroelectric application has been filed with fishway; (2) a 61-foot-long intake NEPA document—September, 2004. with the Commission and is available structure with three 10-by 10-foot radial Order issuing the Commission’s for public inspection. gates; (3) a canal inlet structure decision on the application—October, a. Type of Application: New Major consisting of a canal intake, trash racks, 2004. License. and a sluice gate; (4) a flowline with a Final amendments to the application b. Project No.: 382–026. combined total length of 1,985-feet of must be filed with the Commission no c. Date Filed: February 26, 2003. tunnel, 1,651-feet of steel Lennon flume, later than 30 days from the issuance d. Applicant: Southern California 3,683-feet of steel siphon, and 51,835- date of the notice of ready for Edison Company. feet of concrete-lined canal; (5) four environmental analysis. e. Name of Project: Borel steel penstock, penstocks 1 and 2 are Hydroelectric Project. Magalie R. Salas, 526-feet-long and 565-feet-long, f. Location: On the Kern River near Secretary. the town of Bodfish in kern County, respectively with varying diameters between 42 and 60 inches, penstocks 3 [FR Doc. 03–6028 Filed 3–12–03; 8:45 am] California. BILLING CODE 6717–01–P g. Filed Pursuant to: Federal Power and 4 each have a 60-inch-diameter and Act 16 U.S.C. 791(a)–825(r). extend 622-feet at which point they wye h. Applicant Contact: Nino J. together to form a single 84-inch- DEPARTMENT OF ENERGY Mascolo, Senior Attorney, Southern diameter, 94-foot-long penstock; (6) a California Edison Co., 2244 Walnut powerhouse with two 3,000 kW Federal Energy Regulatory Grove Avenue, PO Box 800, Rosemead, generators and a 6,000kW generator for Commission a total installed capacity of 12,000 kW California 91770; (626) 302–4459. [Docket No. RM98–1–000] i. FERC Contact: Kenneth Hogan at or 12 MW; and (7) other appurtenant facilities. The Project has no storage (202) 502–8434 or Regulations Governing Off-the-Record capability and relies on water releases [email protected]. Communications; Public Notice j. Cooperating agencies: We are asking from Lake Isabella made by the U.S. Federal, state local and tribal agencies Army Corp of Engineers. March 7, 2003. with jurisdiction and/or special n. A copy of the application is on file This constitutes notice, in accordance expertise with respect to environmental with the Commission and is available with 18 CFR 385.2201(h), of the receipt issues to cooperate with us in the for public inspection. This filing may of exempt and prohibited off-the-record preparation of the environmental also be viewed on the Commission’s communications. document. Agencies who would like to Web site at http://www.ferc.gov , using Order No. 607 (64 FR 51222, request cooperating status should follow the ‘‘FERRIS’’ link. Enter the docket September 22, 1999) requires instructions for filing comments number excluding the last three digits in Commission decisional employees, who described in item k below. the docket number filed to access the make or receive an exempt or a k. Deadline for filing additional study document. For assistance, contact FERC prohibited off-the-record requests is 60 days from the date of this Online Support at communication relevant to the merits of notice. [email protected] or toll- a contested on-the-record proceeding, to All documents (original and eight free at (866) 208–3676, or for TTY, deliver a copy of the communication, if copies) should be filed with: Ms. contact (202) 502–8659. A copy is also written, or a summary of the substance Magalie R. Salas, Secretary, Federal available for inspection and of any oral communication, to the Energy Regulatory Commission, 888 reproduction at the address in item h Secretary. First Street, NE., Washington, DC 20426. above. Prohibited communications will be The Commission’s Rules of Practice o. With this notice, we are initiating included in a public, non-decisional file require all intervenors filing documents consultation with the California State associated with, but not part of, the with the Commission to serve a copy of Historic Preservation Officer (SHPO), as decisional record of the proceeding. that document on each person on the required by § 106, National Historic Unless the Commission determines that official service list for the project. Preservation Act, and the regulations of the prohibited communication and any

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responses thereto should become part of Any person identified below as [Docket No. RM98–1–000]The following is a the decisional record, the prohibited off- having made a prohibited off-the-record list of exempt and prohibited off-the-record the-record communication will not be communication should serve the communications recently received in the considered by the Commission in document on all parties listed on the Office of the Secretary. These filings are available for review at the Commission in the reaching its decision. Parties to a official service list for the applicable proceeding may seek the opportunity to Public Reference Room or may be viewed on proceeding in accordance with rule the Commission’s Web site at http:// respond to any facts or contentions 2010, 18 CFR 385.2010. made in a prohibited off-the-record www.ferc.gov using the ‘‘FERRIS’’ link. Enter the docket number excluding the last three communication, and may request that Exempt off-the-record communications will be included in the digits in the docket number field to access the Commission place the prohibited the document. For assistance, please contact communication and responses thereto decisional record of the proceeding, unless the communication was with a FERC Online Support at in the decisional record. The [email protected] or toll-free at Commission will grant such requests cooperating agency as described by 40 (866) 208–3676, or for TTY, contact (202) only when it determines that fairness so CFR 1501.6, made under 18 CFR 502–8659. requires. 385.2201(e)(1)(v).

Date Presenter or Docket No. filed requester

Prohibited

1. Project No. 2342–000 ...... 2–20–03 Anita Gale. 2. Project No. 2342–000 ...... 3–5–03 Kya Eckstrand.

Exempt

1. RP00–241–000 ...... 2–19–03 Brenda L. Mackall. 2. CP02–396–000 ...... 2–25–03 Steven A. Minnich. 3. Project No. 6032–000 ...... 2–25–03 Deborah Osborne. 4. Project No. 2042–013 ...... 2–27–03 William Ryan. 5. Project No. 184–000 ...... 3–3–03 Frank Winchell. 6. Project No. 2042–013 ...... 3–3–03 Gordon Macatee. 7. Project No. 2086–000 ...... 3–04–02 Lorrie Planas.

Magalie R. Salas, that day. New applications involving ICR describes the nature of the Secretary. this project site, to the extent provided information collection and its estimated [FR Doc. 03–6004 Filed 3–12–03; 8:45 am] for under 18 CFR part 4, may be filed burden and cost. BILLING CODE 6717–01–P on the next business day. DATES: Additional comments may be Magalie R. Salas, submitted on or before April 14, 2003. ADDRESSES: Follow the detailed DEPARTMENT OF ENERGY Secretary. [FR Doc. 03–6003 Filed 3–12–03; 8:45 am] instructions in SUPPLEMENTARY INFORMATION. Federal Energy Regulatory BILLING CODE 6717–01–P Commission FOR FURTHER INFORMATION CONTACT: Mary Susan Bailey, Climate Protection [Project No. 11854–002] ENVIRONMENTAL PROTECTION Partnerships Division, Mailcode: 6202J, AGENCY Environmental Protection Agency, 1200 Ketchikan Public Utilities; Notice of Pennsylvania Ave., NW., Washington, Surrender of Preliminary Permit [OAR–2002–0092; FRL–7466–1] DC 20460; telephone number: (202) March 7, 2003. 564–0189; fax number: (202) 565–2083; Agency Information Collection Take notice that Ketchikan Public e-mail address: Activities; Submission of EPA ICR No. [email protected]. Utilities, permittee for the proposed 1772.03, OMB Control No. 2060–0347 Connell Lake Project, has requested that to OMB for Review and Approval; SUPPLEMENTARY INFORMATION: EPA has its preliminary permit be terminated. Comment Request submitted the following ICR to OMB for The permit was issued on July 3, 2001, review and approval according to the and would have expired on June 30, AGENCY: Environmental Protection procedures prescribed in 5 CFR 1320.12. 2004. The project would have been Agency (EPA). On October 29, 2002 (67 FR 65979), EPA located on Connell Lake and Ward ACTION: Notice. sought comments on this ICR pursuant Creek in Ketchikan Gateway Borough, to 5 CFR 1320.8(d). EPA received no Alaska. SUMMARY: In compliance with the comments. The permittee filed the request on Paperwork Reduction Act (44 U.S.C. EPA has established a public docket January 29, 2003, and the preliminary 3501 et seq.), this document announces for this ICR under Docket ID No. OAR– permit for Project No. 11854 shall that the following Information 2002–0092, which is available for public remain in effect through the 30th day Collection Request (ICR) has been viewing at the Air and Radiation Docket after issuance of this notice unless that forwarded to the Office of Management and Information Center in the EPA day is a Saturday, Sunday, or holiday as and Budget (OMB) for review and Docket Center (EPA/DC), EPA West, described in 18 CFR 385.2007, in which approval: Activities Associated with Room B102, 1301 Constitution Ave., case the permit shall remain in effect EPA’s Energy Star Program in the NW., Washington, DC. The EPA Docket through the first business day following Commercial and Industrial Sectors. This Center Public Reading Room is open

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from 8:30 a.m. to 4:30 p.m., Monday scheduled to expire on April 30, 2003. participation to be cost-effective and through Friday, excluding legal Under OMB regulations, the Agency otherwise beneficial for them. holidays. The telephone number for the may continue to conduct or sponsor the In addition, Partners and any other Reading Room is (202) 566–1744, and collection of information while this interested party can help EPA promote the telephone number for the Air and submission is pending at OMB. energy-efficient technologies by Radiation Docket and Information Abstract: Energy Star is a voluntary evaluating the efficiency of their Center is (202) 566–1742. An electronic program to encourage organizations to buildings by benchmarking individual version of the public docket is available prevent pollution rather than buildings by using EPA’s on-line through EPA Dockets (EDOCKET) at controlling it after its creation. The benchmarking tool, Portfolio Manager, http://www.epa.gov/edocket. Use Program focuses on reducing utility- and apply for Energy Star Labels if their EDOCKET to submit or view public generated emissions by reducing the performance ranks in the top 25 percent. comments, access the index listing of demand for energy. In 1991, EPA If they can demonstrate that an the contents of the public docket, and to launched the Green Lights program to individual building meets the Energy access those documents in the public encourage corporations, State and local Star criteria, they will receive an Energy docket that are available electronically. governments, colleges and universities, Star plaque that they can display on the Once in the system, select ‘‘search,’’ and other organizations to adopt energy- building. EPA does not expect to deem then key in the docket ID number efficient lighting as a profitable means any information collected under Energy identified above. of preventing pollution and improving Star to be Confidential Business Any comments related to this ICR lighting quality. Since then, EPA has Information (CBI). should be submitted to EPA and OMB rolled Green Lights into Energy Star and An agency may not conduct or within 30 days of this notice, and expanded Energy Star to encompass sponsor, and a person is not required to according to the following detailed organization-wide energy performance respond to, a collection of information instructions: (1) Submit your comments improvement, such as building unless it displays a currently valid OMB to EPA online using EDOCKET (our technology upgrades, product control number. The OMB control preferred method), by e-mail to a-and- purchasing initiatives, and employee numbers for EPA’s regulations are listed [email protected], or by mail to: EPA training. At the same time, EPA has in 40 CFR part 9 and 48 CFR chapter 15, Docket Center, Environmental streamlined the reporting requirements and are identified on the form and/or Protection Agency, Mailcode: 6102T, of Energy Star and focused on providing instrument, if applicable. 1200 Pennsylvania Ave., NW., incentives for improvements (e.g., Burden Statement: The annual public Washington, DC 20460, and (2) Mail Energy Star Awards Program). EPA also reporting and recordkeeping burden for your comments to OMB at: Office of makes tools and other resources this collection of information will vary Information and Regulatory Affairs, available over the Web to help the depending on the type of participant, Office of Management and Budget public overcome the barriers to the specific collection activity, and (OMB), Attention: Desk Officer for EPA, evaluating their energy performance and other factors. The annual burden for 725 17th Street, NW., Washington, DC investing in profitable improvements. joining Energy Star and conducting 20503. To join Energy Star, organizations are related activities is estimated to range EPA’s policy is that public comments, asked to complete a Partnership Letter from about 2 to 8 hours per respondent. whether submitted electronically or in or Agreement that establishes their This includes time for preparing and paper, will be made available for public commitment to energy efficiency. submitting the Partnership Letter or viewing in EDOCKET as EPA receives Partners agree to undertake efforts such Agreement and other information as them and without change, unless the as measuring, tracking, and requested. The burden for applying for comment contains copyrighted material, benchmarking their organization’s an Energy Star Label is estimated to CBI, or other information whose public energy performance by using tools such range from about 5.5 to 10.5 hours per disclosure is restricted by statute. When as those offered by Energy Star; respondent. This includes time for EPA identifies a comment containing developing and implementing a plan to reading the instructions of the copyrighted material, EPA will provide improve energy performance in their benchmarking tool if needed, gathering a reference to that material in the facilities and operations by adopting a and entering information on building version of the comment that is placed in strategy provided by Energy Star; and characteristics and energy use into the EDOCKET. The entire printed comment, educating staff and the public about tool, printing a score report, and including the copyrighted material, will their Partnership with Energy Star, and preparing/submitting the Energy Star be available in the public docket. highlighting achievements with the Label application materials to EPA. The Although identified as an item in the Energy Star Label, where available. burden for applying for an Energy Star official docket, information claimed as Partners also may be asked to Award is estimated to range from 4 to CBI, or whose disclosure is otherwise periodically submit information to EPA 26.5 hours per respondent. This restricted by statute, is not included in as needed to assist in program includes time for preparing and the official public docket, and will not implementation. For example, EPA submitting the awards application be available for public viewing in compiles the Energy Service and materials to EPA. EDOCKET. For further information Product Provider Directory to provide Burden means the total time, effort, or about the electronic docket, see EPA’s the public with easy access to energy financial resources expended by persons Federal Register notice describing the efficiency products and services. to generate, maintain, retain, or disclose electronic docket at 67 FR 38102 (May Businesses wishing to appear in this or provide information to or for a 31, 2002), or go to http://www.epa.gov/ directory are asked to submit a Federal agency. This includes the time edocket. completed form that details their needed to review instructions; develop, Title: Activities Associated with products and services. acquire, install, and utilize technology EPA’s Energy Star Program in the Partnership in Energy Star is and systems for the purposes of Commercial and Industrial Sectors, voluntary and can be terminated by collecting, validating, and verifying (OMB Control No. 2060–0347, EPA ICR Partners or EPA at any time. EPA does information, processing and No. 1772.03). This is a request to renew not expect organizations to join the maintaining information, and disclosing an existing approved collection that is program unless they expect and providing information; adjust the

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existing ways to comply with any use types). EPA expects to see an annual institutions and non-profit organizations previously applicable instructions and burden increase in benchmarking and supporting the Office of Air and requirements; train personnel to be able related activities of 69,372 hours. Radiation’s Environmental Internship to respond to a collection of In summary, EPA estimates that the Program. This cooperative agreement information; search data sources; burden reduction of 203,743 hours will provide summer internships for complete and review the collection of explained above will be partially offset undergraduate students with information; and transmit or otherwise by the burden increase of 69,372 hours internships in various environmental disclose the information. resulting from increased benchmarking positions at EPA, Native American Respondents/Affected Entities: and related activities. The result is a net Tribal lands, and other institutions. EPA Participants in EPA’s Energy Star burden reduction of 134,371 hours will provide students with work Program in the Commercial and annually. experience and orientation to support Industrial Sectors. Dated: February 25, 2003. their environmental training positions. Estimated Number of Respondents: Oscar Morales, This assistance agreement will enable 5,000. students to prepare to become future Frequency of Response: One-time, Director, Collection Strategies Division. [FR Doc. 03–6108 Filed 3–12–03; 8:45 am] leaders in the environmental field and annually, and/or periodically, to recognize and appropriately manage BILLING CODE 6560–50–P depending on type of respondent and complex environmental problems. It collection. will also provide students with an Estimated Total Annual Hour Burden: environmental consciousness to 83,343 hours. ENVIRONMENTAL PROTECTION encourage them to pursue Estimated Total Annual Cost: AGENCY environmental careers and become $6,594,941, including $1,540,530 in [FRL–7466–3] annualized capital or O&M costs. environmentally conscious citizens. Changes in the Estimates: There is a Office of Air and Radiation Because this internship involves decrease of 134,371 hours in the total Environmental Internship Assistance possible placement of interns onto estimated burden currently identified in Competition: Solicitation Notice Tribal lands, special consideration will the OMB Inventory of Approved ICR be given to schools that have had a Burdens. This decrease is a result of AGENCY: Environmental Protection demonstrated history of recruiting EPA’s streamlining of Energy Star’s Agency (EPA). students with prior experience working information collections since preparing ACTION: Notice; request for initial on tribal issues. However, all ICR 1772.02. EPA now places a greater proposals. universities are encouraged to apply. emphasis on providing voluntary The Catalogue of Federal Domestic SUMMARY: This document solicits incentives for improvements and has Assistance (CFDA) for this program is proposals from educational institutions simplified its collections. For example, 66.607. and nonprofit organizations to provide EPA no longer requires Partners to internships for undergraduate students II. Funding Issues submit the Annual Facility Report with internships in various (AFR), which took Partners over 198,000 Depending upon the availability of environmental positions at EPA, Native hours to prepare/submit annually. EPA funds, it is anticipated that a total of American Tribal lands, and other also simplified other paperwork related approximately $400,000 over three institutions. Students are provided with to their Partnership. Organizations had years, including direct and indirect work experience that will enable them previously submitted a Memorandum of costs, will be awarded in FY 2003. to prepare to become future leaders in Understanding (MOU) to join the Proposals may request funding with a the environmental field. Additionally, program, which took about five hours to total project cost of up to $133,333 per the internship will provide a complete. Partners now prepare a more year with a duration of up to three consciousness that will enable the streamlined Partnership Letter or years. This cooperative agreement is student to recognize and manage Agreement, which takes between 2 and authorized under CAA section 103(b)(3) complex environmental problems. 2.5 hours. EPA estimates that its and no matching funds are required streamlining has resulted in 203,743 SUPPLEMENTARY INFORMATION: from the recipient. hours in burden reduction annually. Contents by Section III. Eligibility This burden reduction is partially I. Background/ Purpose offset, however, because EPA also II. Funding Issues Organizations being targeted for this expects to see greater benchmarking III. Eligibility assistance agreement include accredited activity over the coming years. EPA IV. Cooperative Agreement 4-year educational institutions and non- developed a Web-based tool, Portfolio V. Deadlines/ Dates profit organizations. EPA reserves the Manager, to help organizations VI. Program Design right to reject all applications and make VII. Criteria/ Scope no awards. benchmark the energy use in their VIII. Proposals Format buildings. ICR 1772.02 estimated about IX. Where and When to Submit IV. Cooperative Agreement 2,300 benchmarkings per year, whereas X. Pre-application Assistance ICR 1772.03 estimates more than 23,000 XI. Notification of Proposal Receipt The resulting award will be a benchmarkings per year. This expected XII. Notification of Unsuccessful Offerors Cooperative Agreement. Cooperative growth reflects EPA’s view that an XIII. Completed Application Package Agreements involve substantial increased number of organizations will XIV. Executive Order 12372 involvement between the EPA Project find Portfolio Manager beneficial and XV. Award Date Officer and the selected applicant. XVI. Dispute Resolution Process Anticipated substantial Federal use it to improve their energy XVII. Applicable Regulations performance. EPA also expects to XVIII. Confidential Business Information involvement for this project will conduct activities to expand and refine include: Portfolio Manager (e.g., information I. Background/ Purpose 1. The EPA Project Officer will be part collection and beta testing to expand This document solicits cooperative of the final evaluation of the interns for Portfolio Manager to include new space agreement proposals from educational placement. The final decision of intern

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selection and placement rests with the system to process and evaluate document (please see section III recipient. applications. At a minimum, the ‘‘Eligibility’’). Only those proposals that 2. No stipend dollars will be used for application process must evaluate meet the eligibility requirement will any other purposes without the prior potential interns on the basis of their enter the full evaluation phase of the approval of the EPA Project Officer. academic record, computer skills, review process. During the evaluation 3. The EPA Project Officer will awards, and writing skills. Special phase, proposals will be evaluated accompany the recipient on site visits consideration will be given to based upon the quality of their (internship placement locations) and applicants that have scholarships, proposals. Reviewers conducting the recruitments, when necessary. fellowships and/or work experience on screening and evaluation phases of the V. Deadlines/Dates tribal issues. Students must have a grade review process will include EPA point average of 2.8 or higher to meet officials and external environmental In order to efficiently manage the eligibility for internships at EPA. educators approved by EPA. At the selection process, the Office of Air and • Eligibility requirements for conclusion of the evaluation phase, the Radiation requests that an informal internships: Students must be enrolled reviewers will score work plans, on a ‘‘Intent to Apply’’ be submitted by in a four-year accredited college or one hundred point scale, based upon March 28, 2003. (Please provide project university. Students enrolled in a four- the system below: title or subject and e-mail address.) An year college or university must have ‘‘Intent to Apply’’ simply states, in the achieved at least second semester Maximum form of e-mail, mail, or fax, that your Criterion points per sophomore standing, or have completed criterion organization intends to submit a 45 credit hours of academic study. • proposal to be received by the deadline. Internship Management: Their Effectiveness of overall work plan Submitting an ‘‘Intent to Apply’’ does recruitment priorities, internship and ability to cover all items not commit an organization to submit a management and how they foresee listed in Section VI ‘‘Program pre-proposal. The ‘‘Intent to Apply’’ is interaction with EPA. Applicants Design’’ ...... 25 an optional submission; those not should describe training for students Ability to recruit a diverse group submitting an ‘‘Intent to Apply’’ may (i.e. environmental, math, science of students and those with prior still apply by the deadline for courses), and student intern experience working on tribal issues or having familiarity and submitting proposals, which is April 29, performance evaluations. • knowledge about tribal issues .. 20 2003. However, only those submitting Orientation in Washington, DC: The Effectiveness of placements fo- an intent to apply will be given the orientation program should provide an cusing on site and diversity of conference call-in number for pre- opportunity for students to familiarize placement ...... 20 application assistance (please see themselves with their prospective Ability to plan and execute an ori- section X ‘‘Pre-application assistance’’). program offices and the functions of the entation for each internship Instructions for submitting Intents to program office as well as the issues of class ...... 20 Apply and Proposals are found in the specific media (water, air, solid Ability to evaluate student per- section IX ‘‘Where and When to waste, etc). formance ...... 10 Submit.’’ • Placements: Applicants should A detailed yearly budget ...... 5 describe the process and how they will VI. Program Design Total Points Possible ...... 100 select placement sites focusing on tribal EPA anticipates student stipends to be placements, when applicable. • After the scores are evaluated and • approximately $4,500 per semester and Housing: Include how housing (if ranked, the selected applicant will be the housing allowance to be needed) will be provided to students in asked to submit a complete application approximately $1,500 (on an as-needed the various project sites. • package. For further information on basis.) The Office of Air and Radiation Personnel and Administrative submitting completed application expects to host a minimum of ten Services: Include how personnel and packages, please see Section XIII below. students per semester. Applicants administrative services for interns will should describe the following in detail: be provided. Such services should VIII. Proposal Format • Recruitment: Each proposal should include ensuring students provide their The proposal should conform to the address their recruitment process in own short-term sickness and accident following outline: terms of obtaining a diverse population insurance and assisting students with 1. Title of students. Universities that have a financial support (bank services for 2. Applicant (Organization) and demonstrated history of recruiting student to deposit stipend checks, etc.). contact name, phone number, fax and e- students who have had prior experience • Program Effectiveness: How the mail address on tribal issues will be given special applicant plans to evaluate the success 3. Summary of funds requested consideration. of each year of the three-year program, 4. Project period: Beginning and • Stipends: Ability to process student and what corrective action they will ending dates (for planning purposes, stipends. Describe process for paying take to make any necessary applicants should assume funds will be student stipends. improvements. available on August 1, 2003). • Tracking: Ability to track students 5. Project work plan (including a after completing the environmental VII. Criteria/Scope description of all tasks, dates of program (i.e. final employment • Review and Selection Process: completion, products and deliverables). selections, location of position, post- Proposals submitted to EPA The project work plan should cover all graduate work) for the purposes of headquarters will be evaluated using the items listed in section VI ‘‘Project creating an alumni database, measure criteria defined below. Proposals will be Design.’’ effectiveness of program and to provide reviewed in two phases—the screening 6. Report Schedule: Acknowledgment new students with information and phase and the evaluation phase. During of quarterly report requirement phone numbers of previous students. the screening phase, proposals will be (schedule established by EPA) and • Student Application Processing and reviewed to determine whether they planned final report submission date Evaluation: Recipients must have a meet the eligibility requirement of this (due 90 days after the project end date).

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7. Budget (Please provide with a will be available at the pre-application the procedures outlined at 40 CFR 30.63 narrative explanation for the following assistance conference. Federal rules and § 31.70, subpart F. categories): protecting applicants’ equal access to XVII. Applicable Regulations and OMB a. Personnel. information prohibit any other contact Circulars b. Fringe Benefits. that would result in information given c. Contractual Costs. to some but not all applicants. The applicant selected will abide by d. Travel. Therefore, as much as it desires to 40 CFR part 30, OMB Circular A–122, e. Equipment. encourage all interested applicants, EPA and OMB Circular A–133. f. Supplies. can give no other assistance prior to g. Other. XVIII. Confidential Business final submission of applications. Information h. Total Direct Costs (add a–g). Requests for information outside the i. Total Indirect Costs (must include context of this conference call cannot be If any portion of an applicant’s documentation of accepted indirect answered. The content of the call is proposal is comprised of confidential rate). entirely dependent upon questions business information (CBI), appropriate j. Total Cost (add h and i). asked. pages should be so marked at the top of Costs proposed in the budget must be each page. XI. Notification of Proposal Receipt linked directly to the proposal. For FOR FURTHER INFORMATION CONTACT: example, if there is travel in connection If the applicant includes a stamped, Linda Zarow, USEPA, Office of Air and with recruiting efforts, the budget self-addressed postcard along with Radiation, Immediate Office, Ariel Rios should reflect travel costs. proposal, the applicant will be notified Building, 1200 Pennsylvania Avenue, 8. Attach a one page resume for key of proposal receipt. NW., Washington, DC 20004, Mail Code personnel conducting the project. XII. Notification of Unsuccessful 6101A, Rm 5433. Telephone (202)564– IX. Where and When To Submit Offerors 7431; Fax (202) 501–1004; or e-mail: [email protected]. Please submit intents to apply by The Office of Air and Radiation will March 28, 2003 Intents to Apply must notify all unsuccessful offerors no later Dated: March 7, 2003. be e-mailed, faxed, or mailed to the than 60 days after notifying the selected Elizabeth Craig, Project Officer, Linda Zarow. If Intents applicant. Deputy Assistant Administrator, Office of Air to Apply are mailed, they must be and Radiation. received by March 28, 2003. Only those XIII. Completed Application Packages [FR Doc. 03–6107 Filed 3–12–03; 8:45 am] submitting an ‘‘Intent to Apply’’ will be Completed application package: BILLING CODE 6560–50–P given the conference call-in number for Applies only to the selected applicant. pre-application assistance (please see The selected applicant will be contacted section X ‘‘Pre-application Assistance’’). by the Project Officer and will be ENVIRONMENTAL PROTECTION Send ‘‘Intents to Apply’’ to: Linda requested to submit a complete AGENCY Zarow, Ariel Rios Building, 1200 application. Instruction on how to [OPP–2002–0353; FRL–7286–3] Pennsylvania Ave., Washington, DC obtain an application tool kit will be 20004; mail code 6101A; Rm 5433; fax: provided at that time. The application Experimental Use Permit; Receipt of (202) 501–1004; email: must be postmarked or received by Applications [email protected]. Please include regular or express mail on or before organization name, contact, and phone midnight May 30, 2003. Please provide AGENCY: Environmental Protection number. an original and six copies. Electronic Agency (EPA). Please submit proposals by April 29, applications will be accepted. ACTION: Notice. 2003 (Remember, the Intent to Apply is The application package should be not required and will have no bearing submitted to Linda Zarow at: Ariel Rios SUMMARY: This notice announces receipt on the judging process, we recommend Building, 1200 Pennsylvania Ave. Rm. of applications 68467–EUP–3, 68467– it for the benefit of our planning process 5433, Washington DC 20004; mail code EUP–5, 68467–EUP–T, 68467–EUP–I, only.) Please submit an original and 6101A. Courier or personally delivered 29964–EUP–1, 29964–EUP–3, 29964– three copies of the proposal. Submission applications must be brought to the EUP–U, and 29964–EUP–L from of the Intent to Apply does not commit same address. Mycogen Seeds/Dow Agrosciences LLC the applicant to submit a proposal. and Pioneer Hi-Bred International Submission of an Intent to Apply or a XIV. Executive Order 12372 requesting experimental use permits proposal does not guarantee funding. The applicant selected for funding (EUPs) and EUP amendments for 1) Electronic proposals will be accepted. will be required to provide a copy of the Bacillus thuringiensis Cry34/35Ab1 protein and the genetic material X. Pre-Application Assistance proposal to their designated State Point of Contact for review, pursuant with necessary for its production (from the To ensure that every interested party Executive Order 12372. This review is insert of plasmid PHP 14352) in corn, 2) has equal opportunity to gain any not required of initial proposals; only to Bacillus thuringiensis Cry34/35Ab1 needed additional administrative the selected applicant. protein and the genetic material information useful to the application necessary for its production (from the process, the Office of Air and Radiation XV. Award Date insert of plasmid PHP 12560) in corn, 3) has scheduled one conference call. The Subject to the availability of funding, Bacillus thuringiensis Cry34/35Ab1 call will take place on April 10, 2003 awards should be made by August 1, protein and the genetic material from 10 AM to 12 PM EST. A call-in 2003 for placement in the summer term necessary for its production (from the number will provided to those who 2004. insert of plasmid PHP 17662) in corn, submit an Intent to Apply. Questions and 4) Bacillus thuringiensis Cry34/ and answers from this conference call XVI. Dispute Resolution Process 35Ab1 protein and the genetic material will be summarized and posted on The Agency will resolve any disputes necessary for its production (from the OAR’s web-site. The web-site address arising from this solicitation pursuant to insert of plasmid PHP 17658) in corn.

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The Agency has determined that the Hwy., Arlington, VA. This docket copyrighted material, will be available applications may be of regional and facility is open from 8:30 a.m. to 4 p.m., in the public docket. national significance. Therefore, in Monday through Friday, excluding legal Public comments submitted on accordance with 40 CFR 172.11(a), the holidays. The docket telephone number computer disks that are mailed or Agency is soliciting comments on these is (703) 305–5805. delivered to the docket will be applications. 2. Electronic access. You may access transferred to EPA’s electronic public DATES: Comments, identified by docket this Federal Register document docket. Public comments that are ID number OPP–2002–0353, must be electronically through the EPA Internet mailed or delivered to the docket will be received on or before April 14, 2003. under the ‘‘Federal Register’’ listings at scanned and placed in EPA’s electronic http://www.epa.gov/fedrgstr/. public docket. Where practical, physical ADDRESSES: Comments may be An electronic version of the public objects will be photographed, and the submitted electronically, by mail, or docket is available through EPA’s photograph will be placed in EPA’s through hand delivery/courier. Follow electronic public docket and comment electronic public docket along with a the detailed instructions as provided in system, EPA Dockets. You may use EPA brief description written by the docket Unit I. of the SUPPLEMENTARY Dockets at http://www.epa.gov/edocket/ staff. INFORMATION. to submit or view public comments, FOR FURTHER INFORMATION CONTACT: access the index listing of the contents C. How and To Whom Do I Submit Mike Mendelsohn, Biopesticides and of the official public docket, and to Comments? Pollution Prevention Division (7511C), access those documents in the public You may submit comments Office of Pesticide Programs, docket that are available electronically. electronically, by mail, or through hand Environmental Protection Agency, 1200 Once in the system, select ‘‘search,’’ delivery/courier. To ensure proper Pennsylvania Ave., NW., Washington, then key in the appropriate docket ID receipt by EPA, identify the appropriate DC 20460–0001; telephone number: number. docket ID number in the subject line on (703) 308–8715; e-mail address: Certain types of information will not the first page of your comment. Please [email protected]. be placed in the EPA Dockets. ensure that your comments are Information claimed as CBI and other submitted within the specified comment SUPPLEMENTARY INFORMATION: information whose disclosure is period. Comments received after the I. General Information restricted by statute, which is not close of the comment period will be included in the official public docket, marked ‘‘late.’’ EPA is not required to A. Does this Action Apply to Me? will not be available for public viewing consider these late comments. If you This action is directed to the public in EPA’s electronic public docket. EPA’s wish to submit CBI or information that in general. This action may, however, be policy is that copyrighted material will is otherwise protected by statute, please of interest to those persons who are not be placed in EPA’s electronic public follow the instructions in Unit I.D. Do interested in agricultural biotechnology docket but will be available only in not use EPA Dockets or e-mail to submit or may be required to conduct testing of printed, paper form in the official public CBI or information protected by statute. chemical substances under the Federal docket. To the extent feasible, publicly 1. Electronically. If you submit an Food, Drug, and Cosmetic Act (FFDCA), available docket materials will be made electronic comment as prescribed in this or the Federal Insecticide, Fungicide, available in EPA’s electronic public unit, EPA recommends that you include and Rodenticide Act (FIFRA). Since docket. When a document is selected your name, mailing address, and an e- other entities may also be interested, the from the index list in EPA Dockets, the mail address or other contact Agency has not attempted to describe all system will identify whether the information in the body of your the specific entities that may be affected document is available for viewing in comment. Also include this contact by this action. If you have any questions EPA’s electronic public docket. information on the outside of any disk regarding the applicability of this action Although not all docket materials may or CD ROM you submit, and in any to a particular entity, consult the person be available electronically, you may still cover letter accompanying the disk or listed under FOR FURTHER INFORMATION access any of the publicly available CD ROM. This ensures that you can be CONTACT. docket materials through the docket identified as the submitter of the facility identified in Unit I.B.1. EPA comment and allows EPA to contact you B. How Can I Get Copies of this intends to work towards providing in case EPA cannot read your comment Document and Other Related electronic access to all of the publicly due to technical difficulties or needs Information? available docket materials through further information on the substance of 1. Docket. EPA has established an EPA’s electronic public docket. your comment. EPA’s policy is that EPA official public docket for this action For public commenters, it is will not edit your comment, and any under docket identification (ID) number important to note that EPA’s policy is identifying or contact information OPP–2002–0353. The official public that public comments, whether provided in the body of a comment will docket consists of the documents submitted electronically or in paper, be included as part of the comment that specifically referenced in this action, will be made available for public is placed in the official public docket, any public comments received, and viewing in EPA’s electronic public and made available in EPA’s electronic other information related to this action. docket as EPA receives them and public docket. If EPA cannot read your Although a part of the official docket, without change, unless the comment comment due to technical difficulties the public docket does not include contains copyrighted material, CBI, or and cannot contact you for clarification, Confidential Business Information (CBI) other information whose disclosure is EPA may not be able to consider your or other information whose disclosure is restricted by statute. When EPA comment. restricted by statute. The official public identifies a comment containing i. EPA Dockets. Your use of EPA’s docket is the collection of materials that copyrighted material, EPA will provide electronic public docket to submit is available for public viewing at the a reference to that material in the comments to EPA electronically is Public Information and Records version of the comment that is placed in EPA’s preferred method for receiving Integrity Branch (PIRIB), Rm. 119, EPA’s electronic public docket. The comments. Go directly to EPA Dockets Crystal Mall #2, 1921 Jefferson Davis entire printed comment, including the at http://www.epa.gov/edocket, and

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follow the online instructions for disclosed except in accordance with (FRL–6820–3). Under the original submitting comments. Once in the procedures set forth in 40 CFR part 2. notice, the Cry34/35Ab1 proteins were system, select ‘‘search,’’ and then key in In addition to one complete version of described as 149B1 protein since they docket ID number OPP–2002–0353. The the comment that includes any had not yet received their Bacillus system is an ‘‘anonymous access’’ information claimed as CBI, a copy of thuringiensis Pesticidal Crystal Proteins system, which means EPA will not the comment that does not contain the Nomenclature designation, http:// know your identity, e-mail address, or information claimed as CBI must be www.biols.susx.ac.uk/home/ other contact information unless you submitted for inclusion in the public Neil_Crickmore/Bt/. These proteins provide it in the body of your comment. docket and EPA’s electronic public have now been designated as Cry34Ab1 ii. E-mail. Comments may be sent by docket. If you submit the copy that does and Cry35Ab1 by the Bacillus e-mail to [email protected], not contain CBI on disk or CD ROM, thuringiensis Pesticidal Crystal Proteins Attention: Docket ID Number OPP– mark the outside of the disk or CD ROM Nomenclature Committee, a non- 2002–0353. In contrast to EPA’s clearly that it does not contain CBI. governmental scientific committee. electronic public docket, EPA’s e-mail Information not marked as CBI will be Mycogen Seeds/Dow AgroSciences system is not an ‘‘anonymous access’’ included in the public docket and EPA’s LLC and Pioneer Hi-Bred International system. If you send an e-mail comment electronic public docket without prior have also applied for EUPs involving directly to the docket without going notice. If you have any questions about Bacillus thuringiensis Cry34/35Ab1 through EPA’s electronic public docket, CBI or the procedures for claiming CBI, protein and the genetic material EPA’s e-mail system automatically please consult the person listed under necessary for its production (from the captures your e-mail address. E-mail FOR FURTHER INFORMATION CONTACT. insert of plasmid PHP 17662) in corn, addresses that are automatically and Bacillus thuringiensis Cry34/35Ab1 captured by EPA’s e-mail system are E. What Should I Consider as I Prepare My Comments for EPA? protein and the genetic material included as part of the comment that is necessary for its production (from the placed in the official public docket, and You may find the following insert of plasmid PHP 17658) in corn. made available in EPA’s electronic suggestions helpful for preparing your These EUPs have been proposed as non- public docket. comments: crop destruct. iii. Disk or CD ROM. You may submit 1. Explain your views as clearly as comments on a disk or CD ROM that For Mycogen Seeds/Dow possible. AgroSciences LLC, 394 acres each are you mail to the mailing address 2. Describe any assumptions that you proposed under 68467–EUP–I and identified in Unit I.C.2. These electronic used. submissions will be accepted in 3. Provide copies of any technical 68467–EUP–T for testing in Colorado, WordPerfect or ASCII file format. Avoid information and/or data you used that Hawaii, Illinois, Indiana, Iowa, Kansas, the use of special characters and any support your views. Michigan, Minnesota, Missouri, form of encryption. 4. If you estimate potential burden or Nebraska, North Dakota, Ohio, Puerto 2. By mail. Send your comments to: costs, explain how you arrived at the Rico, South Dakota, Texas, and Public Information and Records estimate that you provide. Wisconsin. Testing is to include maize Integrity Branch (PIRIB), Office of 5. Provide specific examples to breeding and observation nursery, maize Pesticide Programs (OPP), illustrate your concerns. agronomic observation, herbicide Environmental Protection Agency 6. Offer alternative ways to improve tolerance, maize efficacy, insect (7502C), 1200 Pennsylvania Ave., NW., the notice. resistance management, and maize Washington, DC, 20460–0001, 7. Make sure to submit your demonstration trials. Attention: Docket ID Number OPP– comments by the deadline in this For Pioneer Hi-Bred International, 623 2002–0353. document. acres are proposed under 29964–EUP–U 3. By hand delivery or courier. Deliver 8. To ensure proper receipt by EPA, and 624 acres are proposed under your comments to: Public Information be sure to identify the docket ID number 29964–EUP–L for testing in California, and Records Integrity Branch (PIRIB), assigned to this action in the subject Georgia, Hawaii, Illinois, Indiana, Iowa, Office of Pesticide Programs (OPP), line on the first page of your response. Kansas, Michigan, Minnesota, Missouri, Environmental Protection Agency, Rm. You may also provide the name, date, Nebraska, North Dakota, Ohio, 119, Crystal Mall #2, 1921 Jefferson and Federal Register citation. Pennsylvania, Puerto Rico, South Davis Hwy., Arlington, VA, Attention: Dakota, Tennessee, Texas, and II. Background Docket ID Number OPP–2002–0353. Wisconsin. Testing is to include insect Such deliveries are only accepted Both Mycogen Seeds/Dow resistance management, maize during the docket’s normal hours of AgroSciences LLC and Pioneer Hi-Bred agronomic observation, maize breeding operation as identified in Unit I.B.1. International have applied to amend and observation nursery, maize EUPs 68467–EUP–3, 68467–EUP– 5, demonstration, maize efficacy, maize D. How Should I Submit CBI To the 29964–EUP–1, and 29964–EUP–3 for hybrid production plots, maize Agency? Bacillus thuringiensis Cry34/35Ab1 regulatory field studies, non-target Do not submit information that you protein and the genetic material organism, and herbicide tolerance trials. consider to be CBI electronically necessary for its production (from the III. What Action is the Agency Taking? through EPA’s electronic public docket insert of plasmid PHP 14352) in corn or by e-mail. You may claim and Bacillus thuringiensis Cry34/35Ab1 Following the review of the Mycogen information that you submit to EPA as protein and the genetic material Seeds/Dow Agrosciences LLC and CBI by marking any part or all of that necessary for its production (from the Pioneer Hi-Bred International’s information as CBI (if you submit CBI insert of plasmid PHP 12560) in corn to applications and any comments and on disk or CD ROM, mark the outside allow plant material grown under these data received in response to this notice, of the disk or CD ROM as CBI and then EUPs to be used for food and/or feed. EPA will decide whether to issue or identify electronically within the disk or The original notice of approval for these deny these EUP requests. Any issuance CD ROM the specific information that is EUPs published in the Federal Register of EUPs will be announced in the CBI). Information so marked will not be on February 20, 2002 (67 FR 7688) Federal Register.

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IV. What is the Agency’s Authority for to March 17, 2003, Michele Kuester, Place: 999 E Street, NW., Washington, Taking This Action? Room 1243, 811 Vermont Avenue, NW., DC. (ninth floor). The specific legal authority for EPA to Washington, DC 20571, Voice: (202) Status: This meeting will be open to take this action is under FIFRA section 565–3766 or TDD (202) 565–3377. the public. 5. FOR FURTHER INFORMATION CONTACT: Items to be Discussed: Correction and Michele Kuester, Room 1243, 811 approval of minutes. List of Subjects Vermont Ave., NW., Washington, DC Notice of proposed rulemaking on Environmental protection, 20571, (202) 565–3766. public funding of Presidential primary Experimental use permits. and general election candidates and Peter Saba, conventions. Dated: March 5, 2003. General Counsel. Administrative matters. Janet L. Andersen, [FR Doc. 03–6054 Filed 3–12–03; 8:45 am] Person to Contact for Information: Mr. Director, Biopesticides and Pollution BILLING CODE 6690–01–M Ron Harris, Press Officer, Telephone: Prevention Division, Office of Pesticide (202) 694–1220. Programs. FEDERAL ELECTION COMMISSION Mary W. Dove, [FR Doc. 03–6187 Filed 3–11–03; 2:49 pm] Secretary of the Commission. BILLING CODE 6560–50–S Sunshine Act; Notice of Meeting [FR Doc. 03–6175 Filed 3–11–03; 2:36 pm] * * * * * BILLING CODE 6715–01–M EXPORT-IMPORT BANK OF THE Previously Announced Date and UNITED STATES Time: Thursday, February 27, 2003, meeting open to the public. This FEDERAL TRADE COMMISSION Notice of Open Special Meeting of the meeting was cancelled. Advisory Committee of the Export- * * * * * Granting of Request for Early Import Bank of the United States (Ex- Previously Announced Date and Termination of the Waiting Period Im Bank). Time: Thursday, March 6, 2003: The Under the Premerger Notification following item has been added to the Rules SUMMARY: The Advisory Committee was agenda: Administrative fines—final established by Public Law 98–181, rules and explanation and justification. Section 7A of the Clayton Act, 15 November 30, 1983, to advise the * * * * * U.S.C. 18a, as added by title II of the Export-Import Bank on its programs and Previously Announced Date and Hart-Scott-Rodino Antitrust to provide comments for inclusion in Time: Friday, March 14, 2003, meeting Improvements Act of 1976, requires the reports of the Export-Import Bank of open to the public. This meeting was persons contemplating certain mergers the United States to Congress. cancelled. or acquisitions to give the Federal Trade Time and Place: Monday, March 24, Commission and the Assistant Attorney * * * * * 2002, at 9:30 a.m. to 12:30 p.m. The Date and Time: Tuesday, March 18, General advance notice and to wait meeting will be held at Ex-Im Bank in 2003, at 10 a.m. designated periods before Room 1143, 811 Vermont Avenue, NW., Place: 999 E Street, NW., Washington, consummation of such plans. Section Washington, DC 20571. DC. 7A(b)(2) of the Act permits the agencies, Agenda: Agenda items include an Status: This meeting will be closed to in individual cases, to terminate this introduction of Advisory Committee the public. waiting period prior to its expiration responsibilities, a legislative update, Items to be Discussed: Compliance and requires that notice of this action be introduction of topics for the year, and matters pursuant to 2 U.S.C. 437g. published in the Federal Register. discussion of the Advisory Committee’s Audits conducted pursuant to 2 The following transactions were recommendations to Ex-Im Bank. U.S.C. 437g, 438(b), and title 26, U.S.C. granted early termination of the waiting Public Participation: The meeting will Matters concerning participation in period provided by law and the be open to public participation, and the civil actions or proceedings or premerger notification rules. The grants last 10 minutes will be set aside for oral arbitration. were made by the Federal Trade questions or comments. Members of the Internal personnel rules and Commission and the Assistant Attorney public may also file written statement(s) procedures or matters affecting a General for the Antitrust Division of the before or after the meeting. If any person particular employee. Department of Justice. Neither agency wishes auxiliary aids (such as a sign * * * * * intends to take any action with respect language interpreter) or other special Date and Time: Thursday, March 20, to these proposed acquisitions during accommodations, please contact, prior 2003, at 10 a.m. the applicable waiting period.

Trans # Acquiring Acquired Entities

Transactions Granted Early Termination—12/30/2002

20030207 ...... Albert G. Lowenthal ...... Canadian Imperial Bank of Com- Canadian Imperial Bank of Commerce. merce. 20030212 ...... General Motors Corporation ...... DaimlerChrysler AG ...... New Venture Gear of Indiana, LLC. 20030215 ...... The Dun & Bradstreet Corpora- Hoover’s, Inc ...... Hoover’s, Inc. tion. 20030225 ...... Blackstone Capital Partners IV Northrop Grumman Corporation .. Automotive Holdings Corp. Merchant Banking Fund L.P. 20030230 ...... Barry Diller ...... Entertainment Publications, Inc ... Entertainment Publications, Inc. 20030231 ...... AmerisourceBergen Corporation Whitney V, L.P ...... US Bioservices Corporation. 20030233 ...... MDU Resources Group, Inc ...... PG&E Corporation ...... Mountain View Power Partners, LLC.

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Trans # Acquiring Acquired Entities

20030234 ...... David H. Murdock ...... Dole Food Company, Inc ...... Dole Food Company, Inc.

Transactions Granted Early Termination—01/02/2003

20030239 ...... Sumitomo Corporation ...... Marubeni Corporation ...... Mitchell Distributing Company LLC. 20030240 ...... Kerry Group plc ...... A.M. Todd Group, Inc ...... SurPure, Ltd. 20030243 ...... Kerry Group plc ...... Hadi B. Lashkajani ...... SunPure, Ltd.

Transactions Granted Early Termination—01/06/2003

20030221 ...... Friedman, Billings, Ramsey FBR Asset Investment Corpora- FBR Asset Investment Corporation. Group, Inc. tion. 20030222 ...... FBR Asset Investment Corpora- Friedman, Billings, Ramsey Friedman, Billings, Ramsey Group, Inc. tion. Group, Inc.

Transactions Granted Early Termination—01/07/2003

20030227 ...... UCB S.A ...... Solutia Inc ...... Solutia Inc. 20030238 ...... Groupe Danone ...... Stonyfield Farm, Inc ...... Stonyfield Farm, Inc. 20030248 ...... Phillips-Van Heusen Corporation Calvin Klein, Inc ...... Calvin Klein, Inc. 20030250 ...... ALLTEL Corporation ...... N. Eric Jorgensen ...... Cellular XL Associates, L.P. 20030251 ...... Apax Excelsior VI, L.P ...... Phillips-Van Heusen Corporation Phillips-Van Heusen Corporation. 20030252 ...... Apax Europe V–A, L.P ...... Phillips-Van Heusen Corporation Phillips-Van Heusen Corporation. 20030258 ...... Liberty Media Corporation ...... Wildblue Communications, Inc .... Wildblue Communications, Inc. 20030259 ...... Intelsat, Ltd ...... Wildblue Communications, Inc .... Wildblue Communications, Inc.

Transactions Granted Early Termination—01/09/2003

20030260 ...... KKR Millennium Fund L.P ...... DTE Energy Company ...... International Transmission Company.

Transactions Granted Early Termination—01/10/2003

20030262 ...... Entravision Communications Cor- Stuart and Anita Subotnick ...... Big City Radio. poration. 20030263 ...... Emanuel J. Freidman ...... Foster Merger Corporation ...... Foster Merger Corporation. 20030264 ...... Dairy Farmers of America, Inc .... Dairy Farmers of America, Inc .... Milk Products, LP. 20030265 ...... Osborne Jay Call...... St. Mary Land & Exploration St. Mary Land & Exploration Company. Company. 20030266 ...... Household International, Inc ...... Gottschalks, Inc ...... Gottschalks, Inc. 20030267 ...... GTCR Fund VII, L.P ...... William Blair Capital Partners V, MGP Holding Corp. L.O. 20030271 ...... ING Furman Selz Investors III Roadway Corporation ...... Arnold Transportation Services, Inc. L.P.

Transactions Granted Early Termination—01/13/2003

20030269 ...... Harry J. Pappas ...... Harry J. Pappas ...... Hispanic America of Houston, LLC. Hispanic America of San Francisco, LLC.

Transactions Granted Early Termination—01/14/2003

20030261 ...... GTCR Fund VI, L.P ...... Integrated Health Services, Inc., IHS Long Term Care, Inc. (Debtor-in-Possession). IHS Therapy Care, Inc.

Transactions Granted Early Termination—01/17/2003

20030245 ...... Berkshire Hathaway Inc ...... Wabash National Corporation ..... Apex Trailer Leasing & Rentals, L.P. 20030281 ...... VERITAS Software Corporation .. Precise Software Solutions Ltd ... Precise Software Solutions Ltd.

Transactions Granted Early Termination—01/21/2003

20030276 ...... Welsh, Carson, Anderson & AmeriPath, Inc ...... AmeriPath, Inc. Stowe IX, L.P. 20030277 ...... Welsh, Carson, Anderson & NewCo ...... NewCo. Stowe IX, L.P. 20030278 ...... Universal American Financial Ceres Group, Inc ...... The Pyramid Life Insurance Company. Corp. 20030284 ...... ABRY Broadcast Partners II, L.P Morris Network, Inc ...... Morris Network of Alabama, Inc. United Broadcasting Corporation. 20030285 ...... Eastman Kodak Company ...... Donald J. Burrell ...... Burrell Colour, Inc. 20030297 ...... Itron, Inc ...... Silicon Energy Corp ...... Silicon Energy Corp.

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Trans # Acquiring Acquired Entities

Transactions Granted Early Termination—01/27/2003

20030289 ...... Morgan Stanley Dean Witter Michael Pardy ...... Southern Care Birmingham, Inc. Capital partners IV, L.P. Southern Care Hospice, Inc. Southern Care Newton, Inc. Southern Hospice Care, Inc. SouthernCare Systems, Inc. 20030291 ...... Berkshire Fund VI, Limited Part- Acosta, Inc ...... Acosta, Inc. nership. 20030292 ...... Berkshire Fund V, Limited Part- Acosta, Inc ...... Acosta, Inc. nership. 20030293 ...... Nautic Partners V, L.P ...... Cortec Group Fund III, L.P ...... Gaymar Holdings, Inc. 20030300 ...... K2 Inc...... Rawlings Sporting Goods Com- Rawlings Sporting Goods Company, Inc. pany, Inc. 20030301 ...... Sanmina-SCI Corporation...... International Business Machines International Business Machines Corporation. Corporation. 20030309 ...... Tribune Company ...... ACME Communications, Inc ...... ACME Television Holdings of Missouri, Inc (v/s). ACME Television Licenses of Oregon, LLC (Assets). ACME Television of Oregon, LLC (Assets).

Transactions Granted Early Termination—01/28/2003

20030304 ...... Solectron Corporation ...... R–2 Group Holdings LLC ...... Electron Manufacturing Services, Inc. 20030311 ...... Silgan Holdings, Inc ...... Amcor Limited ...... Amcor White Cap, LLC. 20030312 ...... Ronald O. Perelman ...... SpectaGuard Acquisition LLC ..... SpectaGuard Acquisition LLC.

Transactions Granted Early Termination—01/30/2003

20030296 ...... EPIQ Systems, Inc ...... Bankruptcy Services LLC ...... Bankruptcy Services LLC.

Transactions Granted Early Termination—01/31/2003

20020479 ...... Dainippon Ink and Chemicals, In- Bayer AG ...... Bayer Corporation. corporated. 20030270 ...... Quadrangle Capital Partners LP Cablevision Systems Corporation Cablevision Systems Corporation. 20030286 ...... Watson Pharmaceuticals, Inc ...... Novartis AG ...... Novartis Pharma AG. Novartis Pharmaceuticals Corporation. 20030331 ...... Valassis Communications, Inc ..... Prudential plc ...... NCH Marketing Services, Inc. 20030338 ...... Great Lakes Chemical Corpora- Dean A. Kelly ...... Lime-O-Sol Company. tion. 20030339 ...... Great Lakes Chemical Corpora- James L. Godschalk, Jr ...... Lime-O-Sol Company. tion.

Transactions Granted Early Termination—02/03/2003

20030298 ...... SunGard Data Systems Inc ...... Michael Picozzi, III ...... Andover Brokerage, LLC. 20030322 ...... Pfizer Inc ...... Eyetech Pharmaceuticals, Inc ..... Eyetech Pharmaceuticals, Inc. 20030323 ...... Fidelity National Financial, Inc ..... Private Equity Investors III, L.P ... Lender’s Service Holdings, Inc. Lender’s Service, Inc. 20030324 ...... Fidelity National Financial, Inc ..... Equity-Linked Investors-II ...... Lender’s Service Holdings, Inc. Lender’s Service, Inc. 20030337 ...... Collins Stewart Holdings plc ...... Tullett plc ...... Tullett plc.

Transactions Granted Early Termination—02/04/2003

20030321 ...... Fomento Economico Mexicano, Panamerican Beverages, Inc ...... Panamerican Beverages, Inc. S.A. de C.V.. 20030330 ...... Mr. Graeme Hart ...... Burns, Philip & Company Limited Burns, Philip & Company Limited.

Transactions Granted Early Termination—02/05/2003

20030128 ...... Pilot Corporation ...... The Williams Companies, Inc ...... Williams TravelCenters, Inc.

Transactions Granted Early Termination—02/07/2003

20030129 ...... Marathon Oil Corporation ...... The Williams Companies, Inc ...... Williams TravelCenters, Inc.

Transactions Granted Early Termination—02/10/2003

20030189 ...... The Lundbeck Foundation ...... Synaptic Pharmaceutical Cor- Synaptic Pharmaceutical Corporation. poration. 20030280 ...... Verizon Communications Inc ...... Cablevision Systems Corporation Boston Holding, LLC. New York PCS Holding, LLC. Northcoast Communications, L.L.C.

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Trans # Acquiring Acquired Entities

20030340 ...... Fidelity National Financial, Inc ..... ANFI, Inc ...... ANFI, Inc. 20030343 ...... Level 3 Communications, Inc ...... Carl C. Icahn ...... XO Communications, Inc. 20030353 ...... Heartland Industrial Partners, L.P Linsalata Capital Partners Fund Highland Group Corporation. II, L.P. 20030354 ...... Prudential Financial, Inc ...... Skandia Insurance Company Ltd. Skandia U.S. Inc. (publ).

Transactions Granted Early Termination—02/12/2003

20030328 ...... Pearson plc ...... The McGraw-Hill Companies, Inc S&P Comstock, Inc. 20030342 ...... Manulife Financial Corporation.... Canada Life Financial Corpora- Canada Life Financial Corporation. tion. 20030345 ...... The Coca-Cola Company ...... Coca-Cola Enterprises Inc ...... Truesdale Packaging Company LLC. 20030349 ...... Forrester Research, Inc ...... Giga Information Group, Inc ...... Giga Information Group, Inc. 20030356 ...... Nichimen Corporation ...... Nissho Iwai Corporation ...... Nissho Iwai Corporation. 20030357 ...... Nissho Iwai Corporation ...... Nichimen Corporation ...... Nichimen Corporation. 20030359 ...... ALLTEL Corporation ...... Cellular North Michigan Network Cellular North Michigan Network General Partner- General Partnership. ship.

Transactions Granted Early Termination—02/14/2003

20030305 ...... Sunrise Assisted Living, Inc ...... Marriott International, Inc ...... Marriott Senior Living Services, Inc. 20030326 ...... Hertal Acquisition plc ...... Riverdeep Group plc ...... Riverdeep Group plc. 20030347 ...... The Bank of New York Company, Credit Suisse Group ...... iNautix Technologies, LLC. Inc. Pershing Limited. Pershing LLC. Pershing Trading Company, L.P. 20030362 ...... ALLTEL Corporation ...... Fidelity National Financial, Inc ..... Fidelity National Financial, Inc. 20030363 ...... Fidelity National Financial, Inc ..... ALLTEL Corporation ...... ALLTEL Information Services, Inc. 20030369 ...... Energizer Holdings, Inc ...... Pfizer Inc ...... N.V. Wilkinson Sword S.A. (Belgium). Pfizer Inc. Schnick North America, Inc. Warner-Lambert Trading Co. Ltd. (Hong Kong). Wilkinson Sword—Productos de Higiene, Lda (Portugal). Wilkinson Sword GmbH (Austria). Wilkinson Sword GmbH (Germany). Wilkinson Sword Limited (UK). Wilkinson Sword S.A.E. (Spain). Wilkinson Sword S.p.A. (Italy). Wilkinson Sword Verwaltungs-GmbH (Germany). Wilkinson-Sword B.V. (Netherlands). 20030376 ...... Valero L.P ...... Valero Energy Corporation ...... Valero Pipeline Company. Valero refining Company-California. Valero Refining-Texas, L.P. 20030379 ...... Canadian Oil Sands Trust ...... EnCana Corporation ...... AEC Oil Sands GP Ltd.

Transactions Granted Early Termination—02/19/2003

20030368 ...... Qwest Communications Inter- Qwest Communications Inter- TW Wireless, L.L.C. national Inc. national Inc.

Transactions Granted Early Termination—02/20/2003

20030348 ...... Techtronic Industries Co., Ltd ..... Royal Appliance Mfg. Co ...... Royal Appliance Mfg. Co.

Transactions Granted Early Termination—02/21/2003

20030344 ...... Odyssey Investment Partners Trans Technology Corporation .... Norco, Inc. Fund, LP. 20030364 ...... National Bedding Company ...... Citigroup Inc ...... Sleepmaster LLC. 20030377 ...... Morgenthaler Partners VI, L.P ..... WCM Beteiligungs—und MPI International Inc. Grundbesitz—Aktiengesell- schaft. 20030378 ...... Matrix Service Company ...... Frank W. Hake, II ...... Hake Group, Inc.

FOR FURTHER INFORMATION CONTACT: 303, Washington, DC 20580. (202) 326– By Direction of the Commission. Sandra M. Peay or Renee A. Hallman, 3100. Donald S. Clark, Contact Representative, Federal Trade Secretary. Commission, Premerger Notification [FR Doc. 03–6077 Filed 3–12–03; 8:45 am] Office, Bureau of Competition, Room BILLING CODE 6750–01–M

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FEDERAL TRADE COMMISSION 159–H, 600 Pennsylvania Avenue, NW., charged in the complaint and prevent Washington, DC 20580. If a comment recurrence of such conduct, while [File Nos. 001 0221, 011 0046, and 021 0181] contains nonpublic information, it must maintaining BMS’s ability to engage in Bristol-Myers Squibb Company; be filed in paper form, and the first page legitimate activities that may promote Analysis To Aid Public Comment of the document must be clearly labeled innovation and benefit consumers. ‘‘confidential.’’ Comments that do not AGENCY: Federal Trade Commission. contain any nonpublic information may Background ACTION: Proposed Consent Agreement. instead be filed in electronic form (in The proposed consent order rests in ASCII format, WordPerfect, or Microsoft substantial part on charges that BMS SUMMARY: The consent agreement in this Word) as part of or as an attachment to abused governmental processes to delay matter settles alleged violations of email messages directed to the following generic competition to three of its federal law prohibiting unfair or email box: [email protected]. highly successful prescription drug deceptive acts or practices or unfair Such comments will be considered by products and, in particular, that it methods of competition. The attached the Commission and will be available misused the regulatory scheme Analysis to Aid Public Comment for inspection and copying at its established by Congress to expedite the describes both the allegations in the principal office in accordance with approval of generic drugs. draft complaint that accompanies the Section 4.9(b)(6)(ii) of the Commission’s A generic drug is a pharmaceutical consent agreement and the terms of the Rules of Practice, 16 CFR 4.9(b)(6)(ii)). product that contains the same active consent order—embodied in the consent Analysis To Aid Public Comment ingredients as its brand-name agreement—that would settle these counterpart and is ‘‘bioequivalent’’ to allegations. The Federal Trade Commission has the branded drug, that is, the FDA has DATES: Comments must be received on accepted for public comment an determined there is no significant or before April 7, 2003. agreement and proposed consent order difference in the rate and extent of with Bristol-Myers Squibb Corporation ADDRESSES: Comments filed in paper absorption of the two products. Generic (BMS). The proposed consent order form should be directed to: FTC/Office drugs typically are sold at substantial would settle charges that BMS engaged of the Secretary, Room 159–H, 600 discounts from the branded drug’s price. in a series of unlawful acts to delay Pennsylvania Avenue, NW., A Congressional Budget Office report competition from generic versions of Washington, DC 20580. Comments filed estimates that purchasers saved $8–10 three of its major drug products. The in electronic form should be directed to: billion on prescriptions at retail proposed consent order has been placed [email protected], as pharmacies in 1994 by purchasing on the public record for 30 days to prescribed below. generic drugs instead of the brand-name receive comments by interested persons. product.1 FOR FURTHER INFORMATION CONTACT: The proposed consent order has been Susan Creighton or Jeffrey Brennan, Congress enacted the Drug Price entered into for settlement purposes Competition and Patent Term FTC, Bureau of Competition, 600 only and does not constitute an Pennsylvania Avenue, NW., Restoration Act of 1984, commonly admission by BMS that it violated the referred to as the ‘‘Hatch-Waxman Act,’’ Washington, DC 20580, (202) 326–2946 law or that the facts alleged in the or 326–3688. to facilitate the entry of lower-priced complaint, other than the jurisdictional generic drugs, while maintaining SUPPLEMENTARY INFORMATION: Pursuant facts, are true. incentives for companies to invest in to section 6(f) of the Federal Trade The complaint charges that BMS research and development of new drugs. Commission Act, 38 Stat. 721, 15 U.S.C. engaged in a series of anticompetitive 46(f), and § 2.34 of the Commission’s acts over the past decade to obstruct the A company seeking approval from the Rules of Practice, 16 CFR 2.34, notice is entry of low-cost generic competition to FDA to market a new drug must file a hereby given that the above-captioned three highly profitable BMS prescription New Drug Application (NDA) consent agreement containing a consent drug products: BuSpar, an anti-anxiety demonstrating the safety and efficacy of order to cease and desist, having been agent; and two anti-cancer drugs, Taxol its product. To receive FDA approval to filed with and accepted, subject to final and Platinol. According to the market a generic version of a branded approval, by the Commission, has been complaint, when confronted with drug, a company files an Abbreviated placed on the public record for a period imminent competition to these drugs New Drug Application (ANDA) of thirty (30) days. The following through generic entry, BMS undertook a demonstrating that its product is bio- Analysis to Aid Public Comment course of conduct that includes: paying equivalent to its branded counterpart, describes the terms of the consent a would-be competitor $72.5 million to but need not provide independent data agreement, and the allegations in the abandon its challenge to a BMS patent on safety and efficacy. complaint. An electronic copy of the and stay off the market until the patent The Hatch-Waxman Act established full text of the consent agreement expired; abusing Food and Drug certain rights and procedures that apply package can be obtained from the FTC Administration (FDA) regulations to when a company seeks approval from Home Page (for March 7, 2003), on the block generic entry; making false the FDA to market a generic product World Wide Web, at http://www.ftc.gov/ statements to the FDA in connection prior to the expiration of a patent or os/2003/03/index.htm. A paper copy with listing patents in the Orange Book; patents relating to the branded drug can be obtained from the FTC Public engaging in inequitable conduct before upon which the generic is based. An Reference Room, Room 130–H, 600 the U.S. Patent and Trademark Office NDA applicant is required to submit to Pennsylvania Avenue, NW., (PTO) to obtain patents; and filing the FDA information on certain types of Washington, DC 20580, either in person baseless patent infringement suits. As a patents relating to the approved drug. or by calling (202) 326–2222. result, the complaint alleges, consumers The FDA lists the approved drug and its Public comments are invited, and may were forced to incur hundreds of related patents in a publication entitled be filed with the Commission in either millions of dollars in additional costs to 1 Congressional Budget Office, How Increased paper or electronic form. Comments obtain vital prescription drug products. Competition from Generic Drugs Has Affected filed in paper form should be directed The proposed order is designed to Prices and Returns in the Pharmaceutical Industry to: FTC/Office of the Secretary, Room remedy the pattern of unlawful conduct xiii, 13 (July 1998).

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‘‘Approved Drug Products with repeatedly stated that its role in patent which there were multiple 30-month Therapeutic Equivalence Evaluations,’’ listings is solely ministerial and that it stays, the additional delay of FDA commonly known as the ‘‘Orange lacks the resources and expertise to approval (beyond the first 30 months) Book.’’ If the PTO grants a patent scrutinize patent information in the ranged from four to 40 months. The FTC relating to an approved drug after the Orange Book. Even when a generic Study also found that later-issued NDA has been approved, and the NDA applicant disputes a patent listing, the patents frequently raise listability or holder submits it for listing in the FDA merely asks the NDA holder to validity concerns. Of the eight drug Orange Book, then the FDA will list it confirm that the listed patent products involving later-issued patents as well. information is correct. Unless the NDA identified in the study, all four that had The listing of patents in the Orange holder itself withdraws or amends its been adjudicated were found invalid or Book plays a substantial role in the listed patent information, the FDA will not infringed. Of the eight drug products timing of FDA approval of generic not remove the patent listings from the involving later-issued patents identified drugs. As part of the ANDA process, the Orange Book.3 Thus, as one court has in the study, three involve the BMS ANDA filer must certify to the FDA stated, ‘‘the FDA’s listing should not products that are the subject of the regarding its generic product and any create any presumption that [a] patent complaint here.7 patents listed in the Orange Book that was correctly listed.’’ 4 In addition, the The Challenged Conduct claim the reference branded drug. If the Federal Circuit has held that generic ANDA filer seeks approval before the applicants have no right to bring a The complaint makes the following expiration of all listed patents, it must: declaratory judgment action to allegations: (1) File what is known as a ‘‘Paragraph challenge an NDA holder’s Orange Book A. BuSpar IV certification,’’ declaring that the listing as improper.5 As long as the patents listed in the Orange Book either patent remains listed, the brand-name BuSpar is used to treat persistent are invalid or will not be infringed by company can continue to benefit from anxiety, a condition affecting an the manufacture, use, or sale of the drug the availability of an automatic 30- estimated 10 million Americans. BMS products for which the ANDA is month stay of FDA approval of ANDAs, began selling BuSpar in 1986, and by submitted; and (2) notify the patent by initiating a patent suit against generic 2000, the year before a generic version holder of the filing of the certification. applicants. became available, BuSpar sales in the If the holder of patent rights files a The Commission’s recent study, United States were over $600 million. patent infringement suit within 45 days Generic Drug Entry Prior to Patent The complaint charges that BMS first of the notification, FDA approval to Expiration (July 2002), examined the entered into an unlawful patent market the generic drug is automatically potential for abuse of the Hatch- settlement agreement, in which it agreed stayed for 30 months, regardless of the Waxman process for Orange Book to pay a potential generic competitor merits of the suit, unless before that listings and 30-month stays.6 The data over $70 million to withhold its generic time the patent expires or a court holds received by the Commission showed version of BuSpar from the market until that the patent is invalid or not that brand-name companies are BMS’s patent expired, and then infringed. increasingly listing in the Orange Book, provided false and misleading Not all patents are eligible for listing and suing on, multiple patents, and that information to the FDA to induce the in the Orange Book and the special these are frequently patents that have FDA to list a later patent on BuSpar in statutory 30-month stay that the Hatch- been listed after an ANDA has been the Orange Book, one that did not meet Waxman Act provides. The statute filed. If patents issued to the brand- either of the statutory requirements for provides for listing only if: (1) The name company are listed before the listing. Additionally, the complaint patent ‘‘claims the drug * * * or a generic applicant files its ANDA, then a alleges that BMS filed baseless patent method of using such drug’’ and (2) the brand-name company’s suit on those infringement suits against generic patent is one ‘‘with respect to which a patents will generate a single 30-month applicants on BuSpar. claim of patent infringement could stay, even though multiple patents are at The settlement agreement arose out of reasonably be asserted if a person not issue in the litigation. If the patent is patent litigation that BMS filed after licensed by the owner of the patent obtained and listed after the generic Schein Pharmaceutical, Inc. submitted engaged in the manufacture, use, or sale applicant has filed its ANDA, however, an ANDA for generic buspirone of the drug.’’ 2 In the case of patents not then the brand-name company can hydrochloride (buspirone), the active eligible for listing in the Orange Book, obtain an additional 30-month stay ingredient in BuSpar. Schein filed a a branded firm still can sue a generic (which may be consecutive to or overlap Paragraph IV certification with the FDA company for patent infringement, but the first 30-month stay) following a in 1992, contending that BMS’s ’763 under ordinary federal litigation generic applicant’s certification that it patent was invalid, because it claimed a procedures and without the benefit of does not infringe the later-issued patent. use of buspirone that had been an automatic 30-month stay. To prevent The FTC Study found that for drugs for anticipated by an earlier BMS patent. sale of the generic product before BMS’s suit triggered a 30-month stay on conclusion of the suit in such cases, a 3 See, e.g., American Bioscience, Inc. v. FDA approval of Schein’s ANDA, which branded firm must obtain a preliminary Thompson, 269 F.3d 1077, 1080 (D.C. Cir. 2001) would have expired in early 1995. injunction, which requires that it (recognizing that the FDA ‘‘has refused to become In December 1994, BMS entered into demonstrate a likelihood of success on involved in patent listing disputes, accepting at face an agreement with Schein to settle their value the accuracy of NDA holders’ patent patent litigation. Pursuant to that the merits, among other factors. declarations and following their listing Although Orange Book listings have instructions’’). agreement, BMS agreed to pay Schein significant legal and competitive 4 Ben Venue Labs., Inc. v. Novartis Pharm. Corp., $72.5 million over the next four years, implications, it is private parties, rather 10 F. Supp. 2d 446, 456 (D.N.J. 1998). and Schein agreed to refrain from than the FDA, that in practice determine 5 See Mylan Pharms., Inc. v. Thompson, 268 F.3d marketing its ANDA product or any 1323, 1329–33 (Fed. Cir. 2001). other generic version of BuSpar whether patents are listed. The FDA has 6 Federal Trade Commission, Generic Drug Entry Prior to Patent Expiration: An FTC Study (July (regardless of whether such product 2 21 U.S.C. 355(b)(1); 355(c)(2); 355(j)(7)(A)(iii) 2002), available at http://www.ftc.gov/os/2002/07/ (2003). genericdrugstudy.pdf. 7 Generic Drug Study at 39–40, 48–50.

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would infringe BMS’s patent), until the determination regarding the ’365 antic-cancer properties were discovered ’763 patent expired. Schein also agreed patent’s scope and coverage. and developed by scientists at the to acknowledge the validity of the ’763 The complaint charges that BMS National Cancer Institute (NCI). In 1991, patent, to refrain from assisting others in knew that its representations to the the NCI gave BMS the exclusive right to challenging the ’763 patent or in FDA—to the effect that the ’365 patent use existing and future data for FDA developing generic buspirone, and to claimed a method of using buspirone— approval of paclitaxel, and BMS take other steps to help BMS protect its were false and misleading. BMS made obtained FDA approval to market Taxol patent from another challenge to its these misrepresentations purposely and in 1992. Prior to generic entry in 2000, validity. intentionally, to obtain an improper BMS’s annual Taxol sales in the United Anticipating expiration of its ’763 Orange Book listing of the ’365 patent. States were over $1 billion. patent in November 2000, BMS filed a Through its wrongful listing in the The complaint charges that BMS used new patent application with the PTO in Orange Book of the ’365 patent, BMS many of the same strategies to obstruct 1999, involving the use of buspirone to illegitimately acquired the ability to generic competition to Taxol that it used create the metabolite of buspirone (a trigger a 30-month stay, thereby with BuSpar: improperly listing patents metabolite is the new molecule created delaying entry of generic buspirone and in the Orange Book (three patents in the when a pharmaceutical agent breaks depriving consumers of lower prices case of Taxol); and abusing the down in the body). The PTO, however, and other benefits of competition. regulatory process through the filing of repeatedly rejected BMS’s efforts Generic competition to BuSpar misrepresentations. In addition, the because BMS had been making and occurred only after the ’365 patent was complaint alleges that BMS entered into selling BuSpar to treat anxiety in the removed from the Orange Book in an unlawful agreement with another United States for nearly 14 years. Only March 2001, following the decision by firm for the purpose of furthering its after BMS finally requested a patent that the district court in Mylan effort to obtain another 30-month stay claimed solely the use of the metabolite Pharmaceuticals, Inc. v. Thompson, 139 on FDA approval of generic versions of of buspirone—not the use of buspirone F. Supp. 2d 1 (D.D.C. 2001), ordering Taxol. itself—and only hours before the ’763 BMS to seek de-listing.8 This In 1992, although it told a patent was due to expire, did the PTO competition occurred substantially later Congressional committee that ‘‘near- issue what became known as the ’365 than it would have absent BMS’s term generic competition for TAXOL is patent. BMS promptly submitted the anticompetitive acts. As a consequence, a certainty,’’ because Taxol was not a ’365 patent information to the FDA for consumers suffered substantial patented product, BMS in fact was listing in the Orange Book. economic detriment by paying actively pursuing a patent application BMS’s ’365 patent did not meet either monopoly prices for an unjustifiably before the PTO on Taxol. In prosecuting of the statutory requirements for listing extended period. a patent in the Orange Book, because it that patent application before the PTO, The complaint also charges that the BMS made representations that were does not claim BuSpar or a method of patent infringement suits BMS brought using BuSpar, and it is not a patent with directly contrary to what it had against ANDA filers for infringement of previously told the FDA in seeking respect to which a claim of patent the ’365 patent were objectively baseless infringement could reasonably be approval of its NDA for Taxol. and filed without regard to their merits. To obtain FDA approval of its NDA, asserted against someone selling The ’365 patent could not be both valid BuSpar. Although BMS knew that it had BMS had relied on several studies in the and infringed. If the patent claim were public domain to show that Taxol was only obtained a patent claiming a interpreted to cover the currently- method of using a metabolite, it safe and effective. Because the NCI approved uses for which the generic funded the discovery and initial nonetheless submitted a declaration to applicants submitted their ANDAs— the FDA affirming that the ’365 patent development of paclitaxel as an anti- necessary to demonstrate that the ANDA cancer drug, much of the research claimed a method of using BuSpar, in products infringed—then the patent order to list the patent in the Orange relating to Taxol was in the public necessarily would be invalid, because domain, so the results of that research Book. Furthermore, BMS intentionally those uses had been known long before made an additional false and misleading were unpatentable. To obtain a patent, BMS applied for the patent. A court BMS had to demonstrate to the PTO that statement after ANDA filers on BuSpar later so found on summary judgment.9 asserted to the FDA that the ’365 patent its claimed method of administering The intent and effect of BMS’s suits, the Taxol differed from the methods used in did not meet the criteria for listing in complaint states, was to wrongfully the Orange Book. The FDA asked BMS those prior studies trigger the 30-month stay as a means of BMS told the PTO that certain studies to provide a declaration that the ’365 preventing generic buspirone patent contains a claim for an approved (ones it had relied on to obtain FDA manufacturers from marketing their approval for Taxol) did not provide use of buspirone. BMS responded with products. a declaration expressly affirming that evidence of safety and efficacy, and thus the ’365 patent does in fact claim the B. Taxol made various statements about the approved uses of buspirone, a statement Taxol is used to treat cancers of the studies that are directly contrary to that was false and directly contradicted ovaries, breasts and lungs, and AIDS- those BMS made to the FDA. In representations BMS made to the PTO related Kaposi’s sarcoma. The drug’s addition, BMS also deliberately failed to to obtain the ’365 patent. Consistent active ingredient, paclitaxel, is a disclose to the PTO material prior art. In with its ministerial approach to Orange naturally-occurring substance whose making false and misleading material Book listings, the FDA simply accepted statements to the PTO and by failing to BMS’s statements and deemed the ’365 8 The Federal Circuit later reversed this ruling on disclose material prior art, BMS patent listed in the Orange Book as of jurisdictional grounds. Mylan Pharms., Inc. v. breached its duty of candor and good November 21, 2000. In so doing, FDA Thompson, 268 F.3d 1323, 1329–33 (Fed. Cir. 2001) faith in dealing with the PTO. BMS noted that it listed the patent solely on (holding no private right of action under the Federal therefore engaged in inequitable Food, Drug, and Cosmetic Act to seek de-listing). the basis of BMS’s declarations that the 9 In re Buspirone Patent Litig., 185 F. Supp. 2d conduct, rendering the two patents that patent met the requirements for listing 340, 359 (S.D.N.Y. 2002); In re Buspirone Antitrust resulted (the ’537 and ’803 patents) and did not make any independent Litig., 183 F. Supp.2d 363, 376 (S.D.N.Y. 2002). unenforceable.

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Because BMS knew that the ’537 and Platinol products was running out, and As a result of this competitive ’803 patents were obtained through four would-be generic rivals were relationship between each of the three inequitable conduct before the PTO, it poised to enter with their lower-cost, BMS branded products and its generic could not reasonably believe that the bioequivalent products. Facing likely bioequivalents, each of these groups of patents were enforceable or generic competition to its Platinol products comprises a distinct relevant consequently that they were listable monopoly for the first time, BMS, which product market for purposes of under the FDA’s Orange Book held an exclusive license to cisplatin, analyzing the challenged conduct here. regulations. Nevertheless, BMS and the licensor decided to amend a According to the complaint, the promptly submitted the patents to the patent application then pending at the relevant geographic market in which to FDA for listing in the Orange Book. PTO—an application that had been assess the competitive effects of BMS’s Furthermore, after a number of generic initially filed more than two decades conduct is the United States, given the pharmaceutical manufacturers filed earlier, in 1970. In October 1996—just FDA’s elaborate regulatory process for ANDAs with Paragraph IV certifications, two months before BMS’s other Platinol approving drugs for sale in the United BMS brought patent infringement patents were to expire—the PTO issued States, and the fact that the marketing, suits—based on patents it knew it had the ’925 patent based on this amended sales, and distribution of obtained through inequitable conduct— application. BMS promptly submitted pharmaceuticals such as those at issue that triggered Hatch-Waxman’s this new patent for listing in the Orange here occur on a nationwide basis. automatic 30-month stay provision, Book. This listing, coupled with BMS’s The complaint alleges that, prior to insulating Taxol from potential generic initiation of a patent infringement the entry of generic versions of its drug competition for that period. lawsuit in federal court against each BuSpar, Taxol, and Platinol products, Finally, BMS improperly listed a third generic cisplatin applicant, triggered an BMS had monopoly power in each of patent in the Orange Book and thereby automatic statutory 30-month stay on the three relevant antitrust markets. obtained the ability to trigger the Hatch- FDA approval of the generic BMS is charged with engaging in acts Waxman provision for another 30- applications. that willfully maintained its monopolies month stay as a result of a conspiracy According to the complaint, BMS in buspirone, paclitaxel, and cisplatin with American Bioscience, Inc. (ABI). could not have reasonably believed that products, thereby violating Section 5 of Shortly after the 30-month stays that the ’925 patent was valid, and its listing the FTC Act. In addition, the complaint BMS had obtained from its unlawful of the patent in the Orange Book was charges that BMS agreed with Schein to listings of the ’537 and ’803 patents not made in good faith to comply with settle patent litigation by paying Schein expired, but before any ANDAs for FDA regulations. In fact, in October not to compete until the patent expired, generic paclitaxel obtained FDA 1999, a district court ultimately found, and agreed with ABI to wrongfully list approval, BMS and ABI agreed on the by clear and convincing evidence, that ABI’s ’331 patent, and challenges those terms of an option to license ABI’s ’331 the ’925 patent was invalid for agreements as acts of monopolization patent. The agreement provided that obviousness-type double patenting, a and as unreasonable restraints of trade ABI would receive royalties based on a ruling that the Federal Circuit later in violation of Section 5. significant percentage of BMS sales of upheld. As a result of BMS’s wrongful Taxol, an arrangement that would be listing of the ’925 patent, consumers Exclusionary conduct by a monopolist highly profitable to ABI if BMS were deprived, for about two years, of that is reasonably capable of continued to enjoy protection from the benefits of a lower-priced generic significantly contributing to the generic competition to Taxol. alternative to BMS’s branded cisplatin maintenance of the firm’s dominance BMS submitted the ’331 patent to the products. gives rise to substantial competitive FDA for listing in the Orange Book, but concerns.10 The conduct alleged in the it could not have reasonably believed Competitive Analysis complaint creates such concerns. that the relevant claims of the ’331 The complaint alleges that the By listing patents in the Orange Book patent were valid, or consequently that relevant product markets in which to that did not meet the statutory the ’331 patent should be listed in the assess the competitive effects of BMS’s requirements for such listings, BMS, Orange Book as claiming Taxol. BMS conduct are: according to the complaint, acquired the knew of material prior art that • Buspirone-based products (BuSpar ability to trigger the Hatch-Waxman 30- invalidated the relevant claims of the and generic bioequivalent versions of month stay provision on FDA approval ’331 patent. Moreover, BMS’s own BuSpar); of competing generic products. An NDA experience with the sale and use of • Paclitaxel-based products (Taxol with monopoly power has an incentive Taxol prior to that date invalidated the and generic bioequivalent versions of to make improper listings to protect its relevant claims of the ’331 patent. Taxol); and monopolies. In addition, NDA holders • Cisplatin-based products (Platinol have the ability to make wrongful C. Platinol and generic bioequivalent versions of listings because the FDA does not police Platinol is used in chemotherapy to Platinol). listings to ensure they meet regulatory treat various forms of cancer. BMS In each market, according to the requirements prior to publishing them began selling Platinol in 1978 and complaint, entry of a lower-priced in the Orange Book.11 The Orange Book Platinol-AQ in 1988, and annual United generic version of BMS’s product States sales of its Platinol products were resulted in a significant, immediate 10 Barry Wright Corp. v. ITT Grinnell Corp., 724 $100 million by 1998. Platinol’s active decrease in the sales of the BMS product F.2d 227, 230 (1st Cir. 1983) (Breyer, J.) (citing 3 pharmaceutical ingredient is cisplatin. and led to a significant reduction in the P. Areeda & D. Turner, Antitrust Law, ¶ 626 at 83 (1978)); see also Aspen Skiing Co. v. Aspen Regarding Platinol, the complaint average price for products in the Highlands Skiing Co., 472 U.S. 585, 596 n.20 alleges that, as with BuSpar and Taxol, relevant market. Conversely, the (1985); Lorain Journal Co. v. United States, 342 U.S. BMS wrongfully submitted a patent for complaint states that the availability of 143, 154 n.7 (1951). listing in the Orange Book to obtain an other therapeutic agents for the 11 As a recent court decision expressly recognized, ‘‘[t]he duty to ensure that the Orange unwarranted 30-month stay on FDA conditions that BuSpar, Taxol, and Book only lists patents that actually claim approved approval of competing generic products. Platinol treat was not sufficient to drugs * * * lies with NDA holders.’’ Purepac By 1996, BMS’s patent protection for its prevent the effects from BMS’s conduct. Continued

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listing scheme established by Congress NDA holders listing a patent without a Taxol, and one on Platinol) cannot assumes and requires that NDA holders reasonable belief that the patent meets qualify for Noerr immunity because they act in good faith in listing patents. the listing requirements in order to use do not constitute petitioning behavior. Listings that are not based on a the 30-month stay provision as a As the court in In re Buspirone Antitrust reasonable, good faith belief that the weapon against generic rivals. Litigation, 185 F. Supp. 2d 363, 370 patent is listable thus cannot be justified Moreover, the pattern of conduct that (S.D.N.Y. 2002), observed in rejecting on grounds that the NDA holder was BMS is charged with having engaged in BMS’s claim of Noerr protection, Orange merely complying with Hatch-Waxman reinforces the charge that BMS acted Book filings involve no petitioning listing regulations.12 The complaint with an intent to abuse the listing because the FDA merely accepts the alleges for each of the challenged process to extend its monopolies in all NDA holder’s representations and listings that BMS lacked a reasonable three drugs. exercises no intervening judgment. In belief that the patents were listable, and BMS’s alleged initiation of baseless addition, Orange Book filings are not that it listed the patents to block generic lawsuits to trigger the 30-month stay entitled to Noerr protection as conduct competition, not in good faith provision and inflict competitive harm incidental to petitioning by means of a compliance with FDA regulations. through the process, rather than through patent infringement suit. The fact that Indeed, the complaint charges that the outcome, of the suit likewise infringement litigation triggers a BMS misled the FDA about the scope, amounts to exclusionary conduct to statutory delay in FDA approval does validity, and enforceability of its maintain BMS’s monopoly in buspirone not render the Orange Book listing patents. In listing the ’365 patent on products. incidental to the litigation. An NDA BuSpar, the complaint alleges, BMS Two of BMS’s challenged acts were holder can bring an infringement suit intentionally made false and misleading taken in concert with other firms, and regardless of whether its patents are statements to the FDA to obtain a the complaint challenges these acts both listed in the Orange Book. Id. at 372.14 wrongful Orange Book listing. Similarly, as monopoly maintenance and as Furthermore, BMS’s filings and other the charges concerning two of the Taxol agreements that unreasonably restrain statements to the FDA are alleged to patents (the ’537 and ’803 patents) trade in violation of Section 5. First, involve knowing and material involve allegations that BMS submitted BMS’s settlement with Schein, in which misrepresentations, and would therefore the patents for listing knowing that it BMS is alleged to have agreed to pay its fall outside the protection of the Noerr had engaged in inequitable conduct potential competitor in the buspirone doctrine for that reason as well. before the PTO, deliberately making market to withhold competition until The challenged settlement agreement misleading statements and concealing patent expiration, eliminated the only between BMS and Schein likewise is material prior art, as part of a scheme to potential generic threat to BuSpar for neither petitioning nor the kind of abuse Hatch-Waxman processes and the entire patent period. Such action not action incidental to petitioning that the thereby extend its monopoly in only would have deprived consumers of Noerr doctrine immunizes.15 paclitaxel. Under well-established the potential, albeit uncertain, Second, with respect to challenged patent law, inequitable conduct in competition from Schein, but also BMS actions that do involve petitioning obtaining a patent makes the patent would have given BMS time to of government (for example, the patent unenforceable.13 But the Orange Book implement what the complaint charges infringement suits involving BuSpar), listing scheme is susceptible to was a further strategy to obstruct the complaint alleges that BMS’s actions opportunistic behavior. The NDA holder competition to BuSpar, obtaining and fall outside the protections of the Noerr can exploit the listing scheme by wrongfully listing the ’365 patent. The doctrine. Regarding the lawsuits, the obtaining patents and listing them in the complaint alleges that the settlement complaint alleges that they were Orange Book to block FDA approvals of agreement has no legitimate objectively baseless and brought to generic rivals for 30 months, even when justification, harms consumers, and is injure a competitor through the process, the NDA holder does not reasonably unlawful. rather than the outcome, of the expect the patents to ultimately hold up BMS’s agreement with ABI to list litigation. As a result, they satisfy the in court. ABI’s ’331 patent likewise involves two-part test for the sham litigation Finally, with respect to two other charges of an unjustified agreement to exception to Noerr set forth in patents (ABI’s ’331 patent on Taxol and obstruct generic competition and share Professional Real Estate Investors, Inc. the ’925 patent on Platinol), the monopoly profits. As set forth in the v. Columbia Pictures Industries., Inc., complaint alleges that BMS submitted complaint, for both parties, the value of 508 U.S. 49 (1993). the listings while fully aware of facts the patent license that ABI agreed to sell Finally, the logic and policy and law that made the patents invalid. to BMS lay in its ability to trigger a 30- underlying the Supreme Court’s Although the Hatch-Waxman Paragraph month stay under Hatch-Waxman: decision in California Motor Transport IV certification process contemplates Delayed generic entry would protect Co. v. Trucking Unlimited, 404 U.S. 508 that some patents that are listed may BMS’s revenues, and the terms of the (1972), which held a pattern of filings ultimately be found invalid or option to license meant that ABI would undertaken without regard to their unenforceable, it does not contemplate receive more in royalty payments from merits to be outside the protections of BMS if BMS continued to hold a Noerr, supports the application of a Pharm. v. Thompson, 2002 WL 31840631, at *5 monopoly in paclitaxel products. pattern exception for BMS’s alleged (D.D.C. Dec 16, 2002). Because most of the acts challenged in pattern of conduct across its buspirone, 12 See, e.g., Southern Pac. Communications Co. v. this matter involve use of governmental paclitaxel, and cisplatin products, and AT&T, 740 F.2d 980, 1009 (D.C. Cir. 1984) (AT&T’s processes, the complaint also conduct in meeting regulations governing its obligations for interconnecting other long distance affirmatively pleads that BMS’s conduct 14 See also Memorandum of Law of Amicus carriers with its local service network can only be is not immune from antitrust liability Curiae Federal Trade Commission in Opposition to justified if it ‘‘is reasonable and if AT&T actually under the Noerr-Pennington doctrine, Defendant’s Motion to Dismiss (Jan. 8, 2002) in In made its decision at the time in good faith on that which protects private parties’ re Buspirone Antitrust Litig., 185 F.Supp. 2d 363 basis rather than solely on the basis of competitive (S.D.N.Y. 2002), available at http://www.ftc.gov/os/ considerations.’’). petitioning for governmental action. 2002/01/busparbrief.pdf. 13 Precision Instrument Mfg. Co. v. Automotive First, BMS’s Orange Book submissions 15 See Andrx Pharms. v. Biovail Corp. Int’l, 256 Maintenance Mach. Co., 324 U.S. 806 (1945). of five patents (one on BuSpar, three on F.3d 799, 817–19 (D.C. Cir. 2001).

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thus provides a separate reason to reject seeking to list the ’365 patent in the and the extensive prior art in the public Noerr immunity here. As is reflected in Orange Book in relation to any NDA in domain. the complaint, the overall course of which the active ingredient is Paragraph IV of the proposed order conduct challenged here constitutes a buspirone. This provision will prevent bars BMS from taking any action to clear and systematic pattern of BMS from seeking to list the ’365 patent obtain or maintain a statutory 30-month anticompetitive misuse of governmental in connection with another buspirone stay on FDA approval with respect to an processes, that is, abusive filings product, for example a new dosage ANDA that references BuSpar or Taxol. undertaken without regard to the merits, strength or formulation of BuSpar, as There have already been multiple 30- in order to use administrative and well as with its current BuSpar NDA. month stays in connection with both of judicial processes—rather than the The limitation on attempts to enforce these drugs, and this provision makes it outcome of those processes—as a the ’365 patent is similar, but allows for clear that further stays would be weapon to obstruct competition. Just as the possibility that BMS might in the improper. At the same time, the the repeated filing of lawsuits brought future have a legitimate claim of proposed order would preserve without regard to the merits, and for the infringement. Thus, Paragraph V bars incentives to innovate by allowing 30- purpose of using the judicial process (as BMS from seeking to enforce the ’365 month stays on new NDAs, even if those opposed to the outcome of the process), patent against a product, or use of a NDAs are related to BuSpar and Taxol. product, that contains buspirone, except warrants rejection of Noerr immunity, General Prohibitions Concerning the that such enforcement is permitted if so too do the alleged repeated filing of Listing and Enforcement of Patents patents on the Orange Book without the drug product in question also regard to their validity, enforceability, contains the metabolite that is the Because improper Orange Book or listability; repeated filing of subject of the ’365 patent (the 6- listings have a significant potential to recklessly or deliberately false Hydrodroxy-metabolite of Buspirone) obstruct competition and harm statements with government agencies; and the infringement claim is based on consumers, the proposed order contains and filing of lawsuits brought with or that metabolite.18 Should such a case general prohibitions designed to deter without regard to the merits, also cause arise, BMS would not obtain an improper listings and to prevent BMS the actions challenged here to fall automatic 30-month stay on FDA from triggering the Hatch-Waxman outside the scope of Noerr’s protection. approval (because of the bar on listing automatic 30-month stay in By issuing the complaint in this in Paragraph II), but, like any patent circumstances that could improperly matter along with the proposed consent holder, it could seek a preliminary block generic entry. Thus, the proposed agreement, the Commission finds reason injunction from the court hearing the order’s Paragraph VI would bar BMS to believe that BMS engaged in the infringement case. from Orange Book listings that are alleged violations of law set forth in the With respect to Taxol, the proposed contrary to the statutes and regulations complaint. order generally bars BMS from seeking governing such listings. For example, to enforce, or collecting royalties on, this provision would prohibit listing The Proposed Order any ‘‘Taxol Patent’’ if the infringement patents in the Orange Book that do not The proposed order is designed to claim involves the use of ‘‘Taxol.’’ The actually claim the drug product at issue. maintain BMS’s incentives to engage in proposed order defines ‘‘Taxol’’ to be This provision is similar to one legitimate conduct that could promote any BMS paclitaxel drug product sold as contained in the consent order issued in innovation, while ensuring protection of of October 2002. As a result, this Biovail Corp., FTC Dkt. No. C–4060 consumers through: provision would not apply to any new (Oct. 2, 2002). • Prohibitions regarding the listing form of Taxol that BMS might develop, In addition, Paragraph VII bars BMS and enforcement of patents relating to and thus it would maintain BMS’s from acting to obtain or maintain a specific BMS products at issue here; incentives to pursue such innovation. Hatch-Waxman 30-month stay on FDA • General prohibitions concerning the With respect to BMS’s existing Taxol approval in certain specified situations. listing and enforcement of patents; and product, however, the proposed order’s Because this provision does not bar • Prohibitions concerning settlement bar on enforcement and royalties would Orange Book listings, ANDA filers of patent litigation and other agreements apply not only to BMS’s ’537 and ’803 would continue to get notice through between an NDA holder and an ANDA patents (patents that the complaint the Orange Book of patents relating to filer. alleges are unenforceable because of the reference drug. Although the Product-Specific Provisions inequitable conduct by BMS before the provision prohibits BMS from suing to PTO), but also to any other U.S. patent trigger the automatic 30-month stay, Paragraphs II through V directly claiming Taxol as a composition of BMS could still bring an infringement address complaint charges concerning matter or a method of using Taxol (by suit and avail itself of the procedures BMS’s unlawful conduct regarding virtue of the definition of ‘‘Taxol available to patent holders generally, patents relating to BuSpar and Taxol. Patent’’ in Paragraph I.EE). Any such including seeking a preliminary The proposed order does not provide patent for the existing Taxol product injunction against market entry by the similar specific relief for Platinol, would almost certainly be invalid, as a generic applicant. because the only unexpired Platinol result of the sale of Taxol since 1992 Paragraph VII.A prohibits BMS from patent was conclusively held invalid. triggering a 30-month stay when the The complaint alleges that the ’365 Thompson, 139 F. Supp. 2d 1 (D.D.C. 2001). The patent is listed after the filing of any patent relating to BuSpar does not cover Federal Circuit later reversed this ruling. Mylan ANDA referencing the NDA. The any uses of buspirone, and a district Pharm., Inc. v. Thompson, 268 F.3d 1323, 1329–33 Commission’s Generic Drug Study 16 (Fed. Cir. 2001) (holding no private right of action court has so held. Accordingly, to found that the listing of patents after a prevent future abusive listing of the ’365 under the Food, Drug, and Cosmetic Act to seek de- 17 listing). By that time, generic buspirone had entered generic applicant has filed its ANDA led patent, Paragraph II bars BMS from the market, and BMS did not seek to re-list the ’365 to substantial delay of FDA approval. patent. The report identified two reasons for 16 In re Buspirone Patent Litig., 185 F. Supp. 2d 18 The proposed order defines ‘‘Patent 340, 359 (S.D.N.Y. 2002). Infringement Claim’’ to include threats of this delay. First, ‘‘later-issued patents’’ 17 In March 2001, a district court ordered BMS to enforcement and other allegations that an ANDA often enabled the NDA holder to obtain seek de-listing of the patent. Mylan Pharms., Inc. v. product infringes the NDA holder’s patent. multiple 30-month stays, resulting in an

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automatic stay period that significantly claim does not conflict with regulations referencing the NDA to which the patent exceeds 30 months. BuSpar and Taxol governing Orange Book listings. relates has been filed. It is intended to involve allegations relating to improper To ensure that BMS does not seek to ensure that BMS does not attempt to efforts to obtain such additional stays. obstruct generic competition through obstruct generic competition by Second, later-issued patents also false statements to the FDA outside the influencing the conduct of the patent typically presented significant questions Orange Book listing context, such as holder. whether they met the criteria for listing, through the citizen petition process, the Provisions Concerning Settlement of and, when courts had ruled, the later- proposed order also contains a general Patent Litigation and Other Agreements issued patents had been found to be prohibition on false statements to the invalid or not infringed.19 BuSpar, FDA. Paragraph VIII bans false and Paragraphs XII though XV address the Taxol, and Platinol all are alleged to misleading statements to the FDA that challenged settlement agreement have involved improper listings. By are material to the approvability or sale between BMS and Schein eliminating the availability of a 30- of a generic version of a BMS brand- Pharmaceutical, Inc., concerning generic month stay on later-issued patents, this name drug product, unless BMS had a BuSpar. Schein was acquired by Watson provision reduces the rewards for reasonable belief that the statement was Pharmaceuticals in August 2000, and obtaining and listing patents neither false nor misleading. the Commission has determined that improperly. Moreover, by denying BMS To address complaint allegations that under the circumstances here it is not the benefit of the 30-month stay on BMS engaged in sham litigation, the necessary to seek an order against later-issued patents, the proposed order proposed order’s Paragraph IX bars BMS Watson to ensure effective relief. should reduce BMS’s incentives to from: asserting any patent infringement This aspect of the proposed order engage in improper behavior before the claim that is objectively baseless; or would essentially prohibit two PTO and the FDA to obtain and list a seeking to enforce a patent that BMS categories of conduct: • patent for the purpose of obtaining an knows is invalid, unenforceable, or not Agreements in which the brand- unwarranted automatic 30-month stay. infringed. name drug company (the NDA holder) This remedy is consistent with the Paragraphs X and XI deal with the makes payments to a potential generic Commission’s recommendation to acquisition of patents, patent licenses, competitor (an ANDA filer) and the Congress that, to reduce the possibility and conduct in connection with such ANDA filer agrees not to market its of abuse of the 30-month stay provision, acquisitions or licenses. These two product for some period of time (except provisions address complaint in certain limited circumstances); and an ANDA filer only be subject to a 30- • month stay for patents listed in the allegations that, as one part of its Agreements between the NDA Orange Book prior to the filing of its unlawful scheme to delay generic holder and an ANDA filer in which the ANDA. competition to Taxol, BMS entered into generic competitor agrees not to enter Paragraph VII also bars a 30-month an unlawful agreement with ABI that the market with a non-infringing generic stay, regardless of when the patent was BMS acquire a license to and list an product, or agrees not to relinquish listed, if BMS engages in certain types invalid ABI patent in the Orange Book exclusivity rights. of misconduct in connection with to maintain BMS’s monopoly in Taxol. Paragraph XII of the proposed order obtaining or listing the patent: As in Biovail Corp., FTC Dkt. No. C– covers agreements to resolve patent inequitable conduct before the PTO in 4060 (Oct. 2, 2002), the proposed order infringement disputes. It bars obtaining the patent (VII.B); making a would require BMS to provide notice to agreements wherein (1) the NDA holder false or misleading statement to the FDA the Commission before it acquires a makes payments or otherwise transfers in connection with listing the patent patent, or an exclusive license to a something of value to the ANDA filer (VII.C); or providing information about patent (whether exclusive by its terms and (2) the ANDA filer agrees not to the patent to the FDA that is or otherwise),20 if BMS intends to list market its product for some period of inconsistent with information it that patent in the Orange Book. Patents time, subject to two exceptions provided to the PTO (VII.D). These obtained through internal development described below. The ban in Paragraph provisions reflect particular types of activities or research joint ventures XII includes not only final settlements unlawful conduct charged in the existing at the time of NDA approval, of ongoing patent infringement complaint. however, do not present the competitive litigation, but also agreements resolving Finally, Paragraph VII would also concerns that the arrangement between claims of patent infringement that have prevent BMS from obtaining a 30-month BMS and ABI does and are excluded not resulted in a lawsuit (see definition stay when it has listed a patent that does from the proposed order’s prior notice in Paragraph I.X.). In addition, by virtue not claim an approved use of the drug requirement. of the definition of ‘‘Agreement’’ in (VII.E) or when the patent is for a If BMS acquires a non-exclusive Paragraph I.G., the proposed order metabolite of an active ingredient listed license to a patent, Paragraph XI bars it makes it clear that the prohibition on in the NDA (VII.F). These provisions from participating in enforcement of, payments for delayed generic entry directly respond to the complaint licensing of, or setting royalties for, that would cover such arrangements even if allegations that BMS obstructed generic patent with respect to an ANDA filer. they are achieved through separate competition to BuSpar by listing the This prohibition applies only to agreements (for example, when one ’365 patent, which did not comply with acquisitions that occur after an ANDA agreement resolves the patent the standards for listing in the Orange infringement dispute and another Book. These provisions would not bar 20 The definition of ‘‘Exclusive License’’ in provides for the payment for delayed BMS from bringing a patent Paragraph I.O includes a license that ‘‘reduces the entry). incentives of the licensor to license the intellectual infringement action triggering a 30- property to other persons.’’ This definition reflects The proposed order prohibits not month stay if the action is based on a that a license may be nominally non-exclusive, but merely cash payments to induce patent claim that is distinct from those its terms may be such (for example, when royalties delayed entry, but, more broadly, identified in these two subparagraphs, paid to the patent holder would be higher if no agreements in which the NDA holder generic entry occurs) that the patent holder would and the listing of that distinct additional have no incentive to license the patent to anyone provides something of value to the other than the manufacturer of the brand-name drug potential generic entrant, and the ANDA 19 Generic Drug Study at iii–iv, 40, 48–54. to which the patent relates. filer agrees in some fashion not to sell

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its product. Although the under Hatch-Waxman (Paragraph XIV). agreement. Accordingly, the proposed pharmaceutical agreements that the Under a proviso, however, such order requires BMS to identify, among Commission has challenged to date have agreements are permitted in the context other things, all others known by BMS involved cash payments, a company of a licensing arrangement if: (1) The to have filed an ANDA for a product could easily evade a prohibition on such first ANDA filer comes to market containing the same chemical entities as agreements by substituting other things immediately with a generic version of the product at issue, as well as the court of value for cash payments. Thus, to the reference drug product; (2) the that is hearing any relevant legal protect against a recurrent violation, the ANDA filer either triggers or proceedings involving BMS. In addition, proposed order is not limited to cash relinquishes the 180-day exclusivity BMS must provide the Commission payments. period; and (3) BMS complies with the with certain documents that evaluate The proposed order would create two notice requirements of Paragraph XVI. the proposed agreement. exceptions to Paragraph XII’s ban on Although a ban on relinquishing The proposed order also provides a giving value for delayed entry. First, the exclusivity rights was not part of the Hart-Scott-Rodino-type ‘‘second ban would not apply if the value BMS challenged settlement agreement request’’ process in connection with the provided to the ANDA filer was only: between BMS and Schein, such notice required by Paragraph XII. (1) The right to market the ANDA agreements have been used to thwart The proposed order also contains product prior to expiration of the patent generic entry and the prohibition of certain reporting and other provisions that it is alleged to infringe; and/or (2) such agreements will help to prevent that are designed to assist the an amount representing BMS’s expected future unlawful conduct.21 Commission in monitoring compliance future litigation costs, up to a maximum Paragraph XV bars agreements that with the order and are standard of two million dollars. This exception involve payment to an ANDA filer and provisions in Commission orders. reflects that a payment limited to the in which the ANDA filer agrees not to The proposed order would expire in NDA-holder’s expected future litigation enter the market for a period of time, but 10 years. costs is not likely to result in a later the patent infringement litigation Opportunity for Public Comment generic entry date than would be continues. As with Paragraph XII’s expected to occur absent the payment. treatment of final settlements, it extends The proposed order has been placed As a fencing-in provision, the proposed beyond cash payments to cover the NDA on the public record for 30 days in order order sets a two-million dollar limit on holder’s providing ‘‘anything of value’’ to receive comments from interested expected litigation cost payments. In to the ANDA filer. The proposed order persons. Comments received during this addition, the exception requires that also provides for an exception to the period will become part of the public BMS notify the Commission at least 30 provision on interim settlements if BMS record. After 30 days, the Commission days in advance of consummating such presents the agreement to a court in will again review the agreement and the an agreement, to allow an assessment of connection with a joint stipulation for a comments received and will decide potential harm to competition that preliminary injunction, and the whether it should withdraw from the could arise as a result of the exclusivity following conditions are met: agreement or make the proposed order provisions of the Hatch-Waxman Act. • BMS must provide certain final. Paragraph XVI sets forth a notification information to the Commission at least The purpose of this analysis is to process similar to that used for mergers 30 days before submitting the joint facilitate public comment on the under the Hart-Scott-Rodino Act, which stipulation to the court, and must also agreement. The analysis is not intended is designed to permit the Commission to provide certain information to the court to constitute an official interpretation of obtain additional information when an along with the joint stipulation; the agreement, the complaint, or the agreement’s potential effect on the • BMS may not oppose Commission proposed consent order, or to modify triggering of the 180-day exclusivity participation in the court’s their terms in any way. period may raise competitive concerns. A second exception addresses the consideration of the request for By direction of the Commission. preliminary injunction; and Donald S. Clark, possibility that there might be some • agreements that fall within the terms of Either: (1) The court issues a Secretary. preliminary injunction and the parties’ the prohibition in Paragraph XII that the [FR Doc. 03–6078 Filed 3–12–03; 8:45 am] agreement conforms to the court’s order; Commission would not wish to prohibit. BILLING CODE 6750–01–P Thus, the proposed order includes a or (2) the Commission determines that mechanism that would permit the the agreement does not raise issues under Section 5 of the FTC Act. Commission to consider and permit DEPARTMENT OF HEALTH AND such arrangements. Notice and Compliance Provisions HUMAN SERVICES Paragraph XIII prohibits agreements The form and timing of the notice that between an NDA holder and an ANDA Food and Drug Administration filer in which the ANDA filer agrees not BMS must provide to the Commission to develop or market a generic drug under Paragraphs X, XII, XIV, and XV of [Docket No. 03F–0088] product that is not the subject of a claim the proposed order is set forth in Paragraph XVI. In addition to supplying Ion Beam Applications; Filing of Food of patent infringement. The complaint Additive Petition alleges that BMS’s settlement agreement a copy of the proposed agreement at with Schein not only barred sale of the least 30 days in advance of its AGENCY: Food and Drug Administration, ANDA product, but also prohibited consummation, BMS is required to HHS. provide certain other information to marketing of any other generic version ACTION: Notice. of BuSpar, regardless of whether it assist the Commission in assessing the infringed a BMS patent. potential competitive impact of the SUMMARY: The Food and Drug The proposed order would also ban Administration (FDA) is announcing 21 See Abbott Labs., FTC Dkt. No. C–3945 (May agreements in which a first ANDA filer 22, 2000); Geneva Pharms, FTC Dkt. No. C–3946 that Ion Beam Applications has filed a agrees not to relinquish its right to the (May 22, 2000); Hoechst Marion Roussel, et al., FTC petition proposing that the food additive 180-day exclusivity period provided Dkt. No. D.9293 (May 8, 2001). regulations be amended by increasing

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the maximum permitted energy level of DATES: Submit written or electronic 64045). This guidance contains only X-rays for treating food to 7.5 million comments on agency guidances at any clarifying editorial changes. electron volts (MeV) from the currently time. This guidance is being issued permitted maximum level of 5.0 MeV. consistent with FDA’s good guidance ADDRESSES: Submit written requests for practices regulation (21 CFR 10.115). FOR FURTHER INFORMATION CONTACT: single copies of this guidance to the The guidance represents the agency’s Celeste Johnston, Center for Food Safety Division of Drug Information (HFD– current thinking on integrating dose- and Applied Nutrition (HFS–265), Food 240), Center for Drug Evaluation and counting mechanisms into MDI drug and Drug Administration, 5100 Paint Research, Food and Drug products. It does not create or confer Branch Pkwy., College Park, MD 20740– Administration, 5600 Fishers Lane, any rights for or on any person and does 3835, 202–418–3423. Rockville, MD 20857. Send one self- not operate to bind FDA or the public. addressed adhesive label to assist that SUPPLEMENTARY INFORMATION: Under the An alternative approach may be used if office in processing your requests. Federal Food, Drug, and Cosmetic Act such approach satisfies the Submit written comments on the (sec. 409(b)(5) (21 U.S.C. 348(b)(5))), requirements of the applicable statutes guidance to the Dockets Management notice is given that a food additive and regulations. petition (FAP 3M4745) has been filed by Branch (HFA–305), Food and Drug Ion Beam Applications, 6000 Poplar Administration, 5630 Fishers Lane, rm. II. Comments Ave., suite 426, Memphis, TN. The 1061, Rockville, MD 20852. Submit Interested persons may, at any time, petition proposes to amend the food electronic comments to http:// submit written or electronic comments additive regulations in § 179.26 Ionizing www.fda.gov/dockets/ecomments. See on the guidance to the Dockets radiation for the treatment of food (21 the SUPPLEMENTARY INFORMATION section Management Branch (see ADDRESSES). CFR 179.26) by increasing the maximum for electronic access to the guidance Two copies of any mailed comments are permitted energy level of X-rays for document. to be submitted, except that individuals treating food to 7.5 MeV from the FOR FURTHER INFORMATION CONTACT: may submit one copy. Comments are to currently permitted maximum level of Sandy Barnes, Center for Drug be identified with the docket number 5.0 MeV. Evaluation and Research (HFD–570), found in brackets in the heading of this The agency has determined under 21 Food and Drug Administration, 5600 document. The guidance and received CFR 25.32(j) that this action is of a type Fishers Lane, rm. 8B–45, Rockville, MD comments are available for public that does not individually or 20857, 301–827–1055. examination in the Dockets Management Branch between 9 a.m. and cumulatively have a significant effect on SUPPLEMENTARY INFORMATION: the human environment. Therefore, 4 p.m., Monday through Friday. I. Background neither an environmental assessment III. Electronic Access nor an environmental impact statement FDA is announcing the availability of is required. Persons with access to the Internet a guidance for industry entitled may obtain the document at either http:/ Dated: February 24, 2003. ‘‘Integration of Dose-Counting /www.fda.gov/cder/guidance/index.htm Alan M. Rulis, Mechanisms into MDI Drug Products.’’ or http://www.fda.gov/ohrms/dockets/ Director, Office of Food Additive Safety, This guidance is intended to assist default.htm. Center for Food Safety and Applied Nutrition. manufacturers who are developing or Dated: March 5, 2003. [FR Doc. 03–5955 Filed 3–12–03; 8:45 am] plan to develop drug products for oral William K. Hubbard, BILLING CODE 4160–01–S inhalation using MDIs. The guidance reflects the agency’s current Associate Commissioner for Policy and recommendations regarding the Planning. DEPARTMENT OF HEALTH AND integration of dose-counting [FR Doc. 03–5956 Filed 3–12–03; 8:45 am] HUMAN SERVICES mechanisms into MDI drug products for BILLING CODE 4160–01–S oral inhalation. Although the contents Food and Drug Administration of the guidance should be considered by any manufacturer of any MDI drug DEPARTMENT OF HEALTH AND HUMAN SERVICES [Docket No. 03D–0043] product (including nasal MDI products), this guidance is neither specifically Health Resources and Services Guidance for Industry on Integration of intended for manufacturers of already Administration Dose-Counting Mechanisms into marketed MDI drug products for oral Metered-Dose Inhaler Drug Products; inhalation nor for manufacturers Council on Graduate Medical Availability developing MDIs for other routes of Education; Notice of Meeting administration (e.g., nasal MDIs). It is AGENCY: Food and Drug Administration, also not intended for manufacturers In accordance with section 10(a)(2) of HHS. developing multidose dry powder the Federal Advisory Committee Act ACTION: Notice. inhalers (MDPIs), which already (Pub. L. 92–463), notice is hereby given incorporate dose counters as an integral of the following meeting: SUMMARY: The Food and Drug part of the delivery system. Name: Council on Graduate Medical Administration (FDA) is announcing the Manufacturers developing new MDPIs Education (COGME). availability of a guidance for industry are encouraged to continue including Date and Time: April 10, 2003; 8:30 a.m.— entitled ‘‘Integration of Dose-Counting dose counters in their delivery systems 4:30 p.m. April 11, 2003; 8:30 a.m.—12 noon. Mechanisms into MDI Drug Products.’’ and may find the contents of this Place: Holiday Inn Select, Versailles 4, This guidance is intended to assist guidance useful in their planning. 8120 Wisconsin Avenue, Bethesda, MD 20814. manufacturers who are developing or A draft guidance of the same name Status: The meeting will be open to the plan to develop drug products for oral was made available for public comment public. inhalation using metered-dose inhalers in a notice published in the Federal Agenda: The agenda for April 10 will (MDIs). Register of December 11, 2001 (66 FR include: welcome and opening comments

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from the Associate Administrator for Health will address issues related to the practice (Catalogue of Federal Domestic Assistance Professions, the Chair of COGME, and the environment of nurses with opening Program Nos. 93.867, Vision Research, Acting Executive Secretary of COGME. In the presentation to set the context. Two panels National Institutes of Health, HHS) morning there will be a panel of speakers on will follow related to the dimensions of the Dated: March 6, 2003. the topics covering the ‘‘Impact of work environment and diversity in the work Malpractice Insurance on Physician Practice’’ environment; Council workgroup sessions LaVerne Y. Stringfield, and ‘‘Impact of Residency Duty Hours and discussion of speaker’s and panels Director, Office of Federal Advisory Restriction—Cost and Structural presentations with development of Committee Policy. Adaptations.’’ recommendations related to the practice [FR Doc. 03–5982 Filed 3–12–03; 8:45 am] In the afternoon there will be presenters on environment of nurses. BILLING CODE 4140–01–M ‘‘Assessment of Medicare’s International For Further Information Contact: Anyone Medical Education Payments for Graduate interested in obtaining a roster of members, Medical Education.’’ After the presentations minutes of the meeting, or other relevant DEPARTMENT OF HEALTH AND the Council’s three workgroups will convene. information should write or contact Ms. HUMAN SERVICES They are the Workgroup on Diversity, Elaine G. Cohen, Executive Secretary, Workgroup on Graduate Medical Education National Advisory Council on Nurse National Institutes of Health Financing, and Workgroup on Workforce. Education and Practice, Parklawn Building, The agenda for April 11 will include a Room 9–35, 5600 Fishers Lane, Rockville, National Eye Institute; Notice of Closed discussion of the Report of the Institute of Maryland 20857, telephone (301) 443–1405. Meeting Medicine, ‘‘Health Professions Education: A Bridge to Quality.’’ The three workgroup Dated: March 7, 2003. Pursuant to section 10(d) of the chairs will give their reports. There will be Jane M. Harrison, Federal Advisory Committee Act, as a discussion on the Development of a Director, Division of Policy Review and amended (5 U.S.C. Appendix 2), notice Framework for Revised COGME Physician Coordination. is hereby given of the following Workforce Goals, plans for future work, and [FR Doc. 03–6113 Filed 3–12–03; 8:45 am] new business. meeting. Agenda items are subject to change as BILLING CODE 4165–15–P The meeting will be closed to the priorities dictate. public in accordance with the FOR FURTHER INFORMATION CONTACT: provisions set forth in sections Anyone requiring information regarding DEPARTMENT OF HEALTH AND 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., the meeting should contact Stanford M. HUMAN SERVICES as amended. The grant applications and the discussions could disclose Bastacky, D.M.D., M.H.S.A., Acting National Institutes of Health Executive Secretary, Council on confidential trade secrets or commercial property such as patentable material, Graduate Medical Education, Division National Eye Institute; Notice of Closed and personal information concerning of Medicine and Dentistry, Bureau of Meeting Health Professions, Room 9A–27, individuals associated with the grant Parklawn Building, 5600 Fishers Lane, Pursuant to section 10(d) of the applications, the disclosure of which Rockville, Maryland 20857, Telephone Federal Advisory Committee Act, as would constitute a clearly unwarranted (301) 443–6326. amended (5 U.S.C. Appendix 2), notice invasion of personal privacy. Dated: March 7, 2003. is hereby given of the following Name of Committee: National Eye Institute meeting. Special Emphasis Panel, CIGITS and OHTS Jane M. Harrison, Cooperative Agreement Applications. Director, Division of Policy Review and The meeting will be closed to the Date: April 23, 2003. Coordination. public in accordance with the Time: 11 a.m. to 3 p.m. [FR Doc. 03–6112 Filed 3–12–03; 8:45 am] provisions set forth in sections Agenda: To review and evaluate cooperative agreement applications. BILLING CODE 4165–15–P 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and Place: Radisson Hotel Old Town, 901 the discussions could disclose North Fairfax Street, Alexandria, VA 22314. confidential trade secrets or commercial Contact Person: Anne E. Schaffner, PhD, DEPARTMENT OF HEALTH AND Scientific Review Administrator, Division of HUMAN SERVICES property such as patentable material, Extramural Research, National Eye Institute, and personal information concerning 6120 Executive Blvd., Suite 350, Bethesda, Health Resources and Services individuals associated with the grant MD 20892, 301–451–2020. Administration applications, the disclosure of which (Catalogue of Federal Domestic Assistance would constitute a clearly unwarranted Program Nos. 93.867, Vision Research, National Advisory Council on Nurse invasion of personal privacy. National Institutes of Health, HHS) Education and Practice; Notice of Dated: March 5, 2003. Meeting Name of Committee: National Eye Institute Special Emphasis Panel, NEI Conference LaVerne Y. Stringfield, In accordance with section 10(a)(2) of Grant Review. Director, Office of Federal Advisory the Federal Advisory Committee Act Date: March 24, 2003. Committee Policy. Time: 2 p.m. to 4 p.m. (Pub. L. 92–463), notice is hereby given [FR Doc. 03–5985 Filed 3–12–03; 8:45 am] Agenda: To review and evaluate grant of the following meeting: applications. BILLING CODE 4140–01–M Name: National Advisory Council on Place: National Institutes of Health, 6120 Nurse Education and Practice. Executive Blvd., Rockville, MD 20852, Date and Time: April 9, 2003, 8:30 a.m.– (Telephone Conference Call). DEPARTMENT OF HEALTH AND 5 p.m.; April 10, 2003, 8:30 a.m.–3 p.m. Contact Person: Jeanette M. Hosseini, PhD, HUMAN SERVICES Place: The Hotel Washington, Scientific Review Administrator, Division of Pennsylvania Avenue, NW., at 15th St., Extramural Research, National Eye Institute, National Institutes of Health; National Washington, DC 20004. Bethesda, MD 20892, (301) 451–2020. Heart, Lung, and Blood Institute; Status: The meeting will be open to the This notice is being published less than 15 Notice of Closed Meeting public. days prior to the meeting due to the timing Agenda: Department, Agency, Bureau and limitations imposed by the review and Pursuant to section 10(d) of the Division administrative updates. The Council funding cycle. Federal Advisory Committee Act, as

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amended (5 U.S.C. Appendix 2), notice language interpretation or other DEPARTMENT OF HEALTH AND is hereby given of the following reasonable accommodations, should HUMAN SERVICES meeting. notify the Contact Person listed below The meeting will be closed to the in advance of the meeting. National Institutes of Health public in accordance with the The meeting will be closed to the provisions set foth in sections 552b(c)(4) National Institute of Arthritis and and 552b(c)(6), Title 5 U.S.C., as public in accordance with the Musculoskeletal and Skin Diseases; amended. The contract proposals and provisions set forth in sections Notice of Closed Meeting the discussions could disclose 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., confidential trade secrets or commercial as amended. The grant applications Pursuant to section 10(d) of the property such as patentable material, and/or contract proposals and the Federal Advisory Committee Act, as and personal information concerning discussions could disclose confidential amended (5 U.S.C. Appendix 2), notice individuals associated with the contract trade secrets or commercial property is hereby given of the following proposals, the disclosure of which such as patentable material, and meeting. would constitute a clearly unwarranted personal information concerning The meeting will be closed to the invasion of personal privacy. individuals associated with the grant public in accordance with the Name of Committee: National Heart, Lung, applications and/or contract proposals, provisions set forth in sections and Blood Institute Special Emphasis Panel, the disclosure of which would 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., Small Business Innovative Research. constitute a clearly unwarranted as amended. The grant applications and Date: March 19, 2003. invasion of personal privacy. the discussions could disclose Time: 1 p.m. to 3:30 p.m. confidential trade secrets or commercial Agenda: To review and evaluate contract Name of Committee: National Heart, Lung, property such as patentable material, proposals. and Blood Advisory Council. and personal information concerning Date: May 29, 2003. Place: National Institutes of Health, 6701 individuals associated with the grant Open: 8 a.m. to 2 p.m. Rockledge Drive, Bethesda, MD 20892, applications, the disclosure of which (Telephone Conference Call). Agenda: For discussion of program policies would constitute a clearly unwarranted Contact Person: Zoe E Huang, MD, and issues. invasion of personal privacy. Scientific Review Administrator, Review Place: National Institutes of Health, Branch, Room 7190, eivision of Extramural Building 31, 31 Center Drive, Bethesda, MD Name of Committee: National Institute of Affairs, National Heart, Lung, and Blood 20892. Arthritis and Musculoskeletal and Skin Institute, National Institutes of Health, 6701 Diseases Special Emphasis Panel, Review of Closed: 2 p.m. to Adjournment. Rockledge Drive, MSC 7924, Bethesda, MD Research Program Project Grants. 20892–7924, (301) 435–0314. Agenda: To review and evaluate grant Date: April 9, 2003. This notice is being published less than 15 applications. Time: 12:30 p.m. to 4 p.m. days prior to the meeting due to the timing Place:National Institutes of Health, Agenda: To review and evaluate grant limitations imposed by the review and Building 31, 31 Center Drive, Bethesda, MD applications. funding cycle. 20892. Place: National Institutes of Health, One (Catalogue of Federal Domestic Assistance Contact Person: Deborah P. Beebe, PhD, Democracy Plaza, 6701 Democracy Program Nos. 93.233, National Center for Director, Division of Extramural Affairs Boulevard, Bethesda, MD 20892, (Telephone Sleep Disorders Research; 93.837, Heart and National Heart, Lung, and Blood Institute, Conference Call). Vascular Diseases Research; 93.838, Lung National Institutes of Health, Two Rockledge Contact Person: Richard J. Bartlett, PhD., Diseases Research; 93,839, Blood Diseases Center, Room 7100, 6701 Rockledge Center, Scientific Review Administrator, National Institute of Arthritis and Musculoskeletal and and Resources Research, National Institutes 7100, 6701 Rockledge Drive, Bethesda, MD of Health, HHS.) Skin Diseases, 6701 Democracy Plaza, 20892, (301) 435–0260. Bethesda, MD 20892, (301) 594–4952. Dated: March 6, 2003. Information is also available on the (Catalogue of Federal Domestic Assistance LaVerne Y. Stringfield, Institute’s/Center’s Home page: Program Nos. 93.846, Arthritis, Director, Office of Federal Advisory www.nhlbi.nih.gov/meetings/index.htm, Musculoskeletal and Skin Diseases Research, Committee Policy. where an agenda and any additional National Institutes of Health, HHS) information for the meeting will be posted [FR Doc. 03–5979 Filed 3–12–03; 8:45 am] Dated: March 5, 2003. BILLING CODE 4140–01–M when available. (Catalogue of Federal Domestic Assistance LaVerne Y. Stringfield, Program Nos. 93.233, National Center for Director, Office of Federal Advisory DEPARTMENT OF HEALTH AND Sleep Disorders Research; 93.837, Heart and Committee Policy. HUMAN SERVICES Vascular Disease Research; 93.838, Lung [FR Doc. 03–5971 Filed 3–12–03; 8:45 am] Diseases Research; 93.839, Blood Diseases BILLING CODE 4140–01–M National Institutes of Health and Resources Research, National Institutes of Health, HHS) National Heart, Lung, and Blood DEPARTMENT OF HEALTH AND Institute; Notice of Meeting Dated: March 6, 2003. HUMAN SERVICES LaVerne Y. Stringfield, Pursuant to section 10(d) of the National Institutes of Health Federal Advisory Committee act, as Director, Office of Federal Advisory Committee Policy. amended (5 U.S.C. Appendix 2), notice National Institute of Arthritis and is hereby given of a meeting of the [FR Doc. 03–5980 Filed 3–12–03; 8:45 am] Musculoskeletal and Skin Diseases; National Heart, Lung, and Blood BILLING CODE 4140–01–M Notice of Closed Meeting Advisory Council. The meeting will be open to the Pursuant to section 10(d) of the public as indicated below, with Federal Advisory Committee Act, as attendance limited to space available. amended (5 U.S.C. Appendix 2), notice Individuals who plan to attend and is hereby given of the following need special assistance, such as sign meeting.

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The meeting will be closed to the Diseases Special Emphasis Panel, Review of Diseases, 6701 Democracy Plaza, Bethesda, public in accordance with the Research Program Project Grants. MD 20892. (301) 594–4952. provisions set forth in sections Date: March 7, 2003. This notice is being published less than 15 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., Time: 8:30 am to 3 pm. days prior to the meeting due to the timing Agenda: To review and evaluate grant limitations imposed by the review and as amended. The grant applications and applications. funding cycle. the discussions could disclose Place: Double Tree Rockville, 1750 confidential trade secrets or commercial (Catalogue of Federal Domestic Assistance Rockville Pike, Rockville, MD 20852. Program Nos. 93.846, Arthritis, property such as patentable material, Contact Person: Aftab A. Ansari, PhD, Musculoskeletal and Skin Diseases Research, and personal information concerning Scientific Review Administrator, National National Institutes of Health, HHS) Institute of Arthritis and Musculoskeletal and individuals associated with the grant Dated: March 5, 2003. Skin Diseases, 6701 Democracy Plaza, applications, the disclosure of which LaVerne Y. Stringfield, would constitute a clearly unwarranted Bethesda, MD 20892, (301) 594–4952. Director, Office of Federal Advisory invasion of personal privacy. This notice is being published less than 15 days prior to the meeting due to the timing Committee Policy. Name of Committee: National Institute of limitations imposed by the review and [FR Doc. 03–5976 Filed 3–12–03; 8:45 am] Arthritis and Musculoskeletal and Skin funding cycle. BILLING CODE 4140–01–M Diseases Special Emphasis Panel, Review of (Catalogue of Federal Domestic Assistance Small Grants for New Investigators. Program No. 93.846, Arthritis, Date: April 2–3, 2003. Musculoskeletal and Skin Diseases Research, DEPARTMENT OF HEALTH AND Time: 8 a.m. to 5 p.m. National Institutes of Health, HHS) Agenda: To review and evaluate grant HUMAN SERVICES Dated: March 5, 2003. applications. National Institutes of Health Place: Holiday Inn—Silver Spring, 8777 LaVerne Y. Stringfield, Director, Office of Federal Advisory Georgia Avenue, Silver Spring, MD 20910. National Institute of Environmental Contact Person: Richard J. Bartlett, PhD, Committee Policy. Health Sciences; Notice of Closed Scientific Review Administrator, National [FR Doc. 03–5973 Filed 3–12–03; 8:45 am] Meeting Institute of Arthritis and Musculoskeletal and BILLING CODE 4140–01–M Skin Diseases, 6701 Democracy Plaza, Pursuant to section 10(d) of the Bethesda, MD 20892, (301) 594–4952. Federal Advisory Committee Act, as (Catalogue of Federal Domestic Assistance DEPARTMENT OF HEALTH AND amended (5 U.S.C. Appendix 2), notice Program Nos. 93.846, Arthritis, HUMAN SERVICES Musculoskeletal and Skin Diseases Research, is hereby given of the following National Institutes of Health, HHS) meeting. National Institutes of Health The meeting will be closed to the Dated: March 5, 2003. public in accordance with the National Institute of Arthritis and LaVerne Y. Stringfield, provisions set forth in sections Musculoskeletal and Skin Diseases; Director, Office of Federal Advisory 552b(c)(4) and 552b(c)(6), title 5 U.S.C., Notice of Closed Meeting Committee Policy. as amended. The grant applications and [FR Doc. 03–5972 Filed 3–12–03; 8:45 am] Pursuant to section 10(d) of the the discussions could disclose BILLING CODE 4140–01–M Federal Advisory Committee Act, as confidential trade secrets or commercial amended (5 U.S.C. Appendix 2), notice property such as patentable material, is hereby given of the following and personal information concerning DEPARTMENT OF HEALTH AND meeting. individuals associated with the grant HUMAN SERVICES The meeting will be closed to the applications, the disclosure a clearly public in accordance with the unwarranted invasion of personal National Institutes of Health provisions set forth in sections privacy. National Institutes of Arthritis and 552b(c)(4) and 552b(c)(6), title 5 U.S.C., Name of Committee: National Institute of Musculoskeletal and Skin Diseases; as amended. The grant applications and Environmental Health Sciences Special Notice of Closed Meeting the discussions could disclose Emphasis Panel, Review of RFA–ES–03–002, confidential trade secrets or commercial Environmental Justice (EJ): Partnerships for Pursuant to section 10(d) of the property such as patentable material, Communication. Date: April 7–9, 2003. Federal Advisory Committee Act, as and personal information concerning individuals associated with the grant Time: 7 p.m. to 1 p.m. amended (5 U.S.C. Appendix 2), notice Agenda: To review and evaluate grant is hereby given of the following applications, the disclosure of which applications. meeting. would constitute a clearly unwarranted Place: Homewood Suites by Hilton-RDU invasion of personal privacy. The meeting will be closed to the Airport /RTP, 4603 Central Park Dr., Durham, Name of Committee: National Institute of NC 27703. public in accordance with the Contact Person: Leroy Worth, PhD, provisions set forth in sections Arthritis and Musculoskeletal and Skin Diseases Special Emphasis Panel, Review of Scientific Review Administrator, Scientific 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., Research Project Grants. Review Branch, Division of Extramural as amended. The grant applications and Date: March 17, 2003. Research and Training, Nat. Institute of the discussions could disclose Time: 12 p.m. to 2 p.m. Environmental Health Sciences, P.O. Box confidential trade secrets or commercial Agenda: To review and evaluate grant 12233, MD EC–30/Room 3171, Research property such as patentable material, applications. Triangle Park, NC 27709. 919/541–0670. and personal information concerning Place: National Institutes of Health, One [email protected]. individuals associated with the grant Democracy Plaza, 6701 Democracy (Catalogue of Federal Domestic Assistance applications, the disclosure of which Boulevard, Bethesda, MD 20892. (Telephone Program Nos. 93.113, Biological Response to would constitute a clearly unwarranted conference call.) Environmental Health Hazards; 93.114, Contact Person: Tracy A Shahan, PhD, Applied Toxicological Research and Testing; invasion of personal privacy. Scientific Review Administrator, National 93.115, Biometry and Risk Estimation— Name of Committee: National Institute of Institutes of Health, National Institute of Health Risks from Environmental Exposures; Arthritis and Musculoskeletal and Skin Arthritis and Musculoskeletal and Skin 93.142, NIEHS Hazardous Waste Worker

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Health and Safety Training; 93.143, NIEHS Contact Person: Maxine A. Lesniak, PhM, Boulevard, Rockville, MD 20852, (Telephone Superfund Hazardous Substances—Basic Scientific Review Administrator, Review Conference Call). Research and Education; 93.894, Resources Branch, DEA, NIDDK, Room 756, 6707 Contact Person: Raul A. Saavedra, Phd, and Manpower Development in the Democracy Boulevard, National Institutes of Scientific Review Administrator, Scientific Environmental Health Sciences, National Health, Bethesda, MD 20892–6600, (301) Review Branch, Division of Extramural Institutes of Health, HHS) 594–7792, [email protected]. Research, NINDS/NIH/DHHS, Neuroscience Dated: March 6, 2003. Name of Committee: National Institute of Center, 6001 Executive Blvd., Suite 3208, LaVerne Y. Stringfield, Diabetes and Digestive and Kidney Diseases MSC 9529, Bethesda, MD 20892–9529, (301)– 496–9223. Director, Office of Federal Advisory Special Emphasis Panel, Androgen Receptor This notice is being published less than 15 Committee Policy. and Prostate Cancer. Date: April 22–23, 2003. days prior to the meeting due to the timing [FR Doc. 03–5977 Filed 3–12–03; 8:45 am] Time: 8 a.m. to 1 p.m. limitations imposed by the review and BILLING CODE 4140–01–M Agenda: To review and evaluate grant funding cycle. applications. Place: Embassy Suites Hotel, 1300 (Catalogue of Federal Domestic Assistance DEPARTMENT OF HEALTH AND Concourse Drive, Linthicum, MD 21090. Program Nos. 93.853, Clinical Research HUMAN SERVICES Contact Person: Dan E. Matsumoto, PhD, Related to Neurological Disorders; 93.854, Scientific Review Administrator, Review Biological Basis Research in the National Institutes of Health Branch, DEA, NIDDK, National Institutes of Neurosciences, National Institutes of Health, Health, Room 749, 6707 Democracy HHS.) National Institute of Diabetes and Boulevard, Bethesda, MD 20892–6600, (301) Dated: March 6, 2003. Digestive and Kidney Diseases; Notice 594–8894, [email protected]. LaVerne Y. Stringfield, of Closed Meetings (Catalogue of Federal Domestic Assistance Director, Office of Federal Advisory Program Nos. 93.847, Diabetes, Pursuant to section 10(d) of the Committee Policy. Endocrinology and Metabolic Research; [FR Doc. 03–5981 Filed 3–12–03; 8:45 am] Federal Advisory Committee Act, as 93.848, Digestive Diseases and Nutrition amended (5 U.S.C. Appendix 2), notice Research; 93.849, Kidney Diseases, Urology BILLING CODE 4140–01–M is hereby given of the following and Hematology Research, National Institutes meetings. of Health, HHS) DEPARTMENT OF HEALTH AND The meetings will be closed to the Dated: March 6, 2003. public in accordance with the HUMAN SERVICES LaVerne Y. Stringfield, provisions set forth in sections National Institutes of Health 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., Director, Office of Federal Advisory Committee Policy. as amended. The grant applications and [FR Doc. 03–5978 Filed 3–12–03; 8:45 am] National Institute of Mental Health; the discussions could disclose Notice of Closed Meetings confidential trade secrets or commercial BILLING CODE 4140–01–M property such as patentable material, Pursuant to section 10(d) of the and personal information concerning Federal Advisory Committee Act, as DEPARTMENT OF HEALTH AND individuals associated with the grant amended (5 U.S.C. Appendix 2), notice HUMAN SERVICES applications, the disclosure of which is hereby given of the following would constitute a clearly unwarranted National Institutes of Health, National meeting. invasion of personal privacy. Institute of Neurological Disorders and The meeting will be closed to the Name of Committee: National Institute of stroke; Notice of Closed Meeting public in accordance with the Diabetes and Digestive and Kidney Diseases provisions set forth in sections Special Emphasis Panel, Intestinal Host Pursuant to section 10(d) of the 552b(c)(4) and 552b(c)(6), Title 5 U.S.C. Defense. Federal Advisory Committee Act, as as amended. The grant applications and Date: March 27, 2003. amended (5 U.S.C. Appendix 2), notice the discussions could disclose Time: 3 p.m. to 4:30 p.m. is hereby given of the following confidential trade secrets or commercial Agenda: To review and evaluate grant property such as patentable material, applications. meeting. Place: National Institutes of Health, Two The meeting will be closed to the and personal information concerning Democracy Plaza, 6707 Democracy public in accordance with the individuals associated with the grant Boulevard, Bethesda, MD 20892, (Telephone provisions set forth in sections applications, the disclosure of which Conference Call). 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., would constitute a clearly unwarranted Contact Person: Lakshmanan Sankaran, as amended. The grant applications and invasion of personal privacy. PhD, Scientific Review Administrator, Review Branch, DEA, NIDDK, Room 754, the discussions could disclose Name of Committee: National Institute of 6707 Democracy Boulevard, National confidential trade secrets or commercial Mental Health Special Emphasis Panel, HIV Institutes of Health, Bethesda, MD 20892– property such as patentable material, Prevention in Treatment Settings. 6600, (301) 594–7799, [email protected]. and personal information concerning Date: March 26, 2003. This notice is being published less than 15 individuals associated with the grant Time: 8:30 a.m. to 5:30 p.m. days prior to the meeting due to the timing Agenda: To review and evaluate grant applications, the disclosure of which applicants. limitations imposed by the review and would constitute a clearly unwarranted funding cycle. Place: Holiday Inn Select Bethesda, 8120 invasion of personal privacy. Name of Committee: National Institute of Wisconsin Ave, Bethesda, MD 20814. Diabetes and Digestive and Kidney Diseases Name of Committee: National Institute of Contact Person: Richard E. Weise, PhD, Special Emphasis Panel, Strategies for Neurological Disorders and Stroke Special Scientific Review Administrator, Division of Improved Shock Wave Lithotripsy. Emphasis Panel. Extramural Activities, National Institute of Date: April 10, 2003. Date: March 18, 2003. Mental Health, NIH, Neuroscience Center, Time: 8:30 a.m. to 5 p.m. Time: 2 p.m. to 4 p.m. 6001 Executive Boulevard, Room 6140, Agenda: To review and evaluate grant Agenda: To review and evaluate grant MSC9606, Bethesda, MD 20892–9606, (301) applications. applications. 443–1225, [email protected]. Place: Holiday Inn, 2650 Jefferson Davis Place: National Institutes of Health, Name of Committee: National Institute of Highway, Arlington, VA 22202. Neuroscience Center, 6001 Executive Mental Health Special Emphasis Panel,

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Ancillary Studies to the STAR*D Project— Contact Person: Anne Krey, Scientific Medical Rehabilitation Research, National Depression Treatment Variability. Review Administrator, Division of Scientific Institutes of Health, HHS) Date: April 7, 2003. Review, National Institute of Child Health Dated: March 6, 2003. Time: 1:30 p.m. to 3 p.m. and Human Development, National Institutes Agenda: To review and evaluate grant of Health, 6100 Executive Blvd., Rm. 5E03, LaVerne Y. Stringfield, applications. Bethesda, MD 20892, (301) 435–6908. Director, Office of Federal Advisory Place: National Institutes of Health, (Catalogue of Federal Domestic Assistance Committee Policy. Neuroscience Center, 6001 Executive Program Nos. 93.209, Contraception and [FR Doc. 03–5986 Filed 3–12–03; 8:45 am] Boulevard, Rockville, MD 20852, (Telephone Conference Call). Infertility Loan Repayment Program; 93.864, BILLING CODE 4140–01–M Contact Person: Houmam H. Araj, PhD, Population Research; 93.865, Research for Scientific review Administrator, Division of Mothers and Children; 93.929, Center for Extramural Activities, National Institute of Medical Rehabilitation Research, National DEPARTMENT OF HEALTH AND Mental Health, NIH, Neuroscience Center, Institutes of Health, HHS) HUMAN SERVICES 6001 Executive Blvd., Room 6148, MSC 9608, Dated: March 5, 2003. Bethesda, MD 20892–9608, (301) 443–1340, LaVerne Y. Stringfield, National Institutes of Health [email protected]. Director, Office of Federal Advisory (Catalogue of Federal Domestic Assistance Committee Policy. National Institute of Allergy and Program Nos. 93.242, Mental Health Research [FR Doc. 03–5984 Filed 3–12–03; 8:45 am] Infectious Diseases; Notice of Closed Grants; 93.281, Scientist Development Meeting Award, Scientist Development award for BILLING CODE 4140–01–M Clinicians, and Research Award; 93.282, Mental Health National Research Service Pursuant to section 10(d) of the Awards for Research Training, National DEPARTMENT OF HEALTH AND Federal Advisory Committee Act, as Institutes of Health, HHS) HUMAN SERVICES amended (5 U.S.C. Appendix 2), notice is hereby given of the following Dated: March 5, 2003. National Institutes of Health meeting. LaVerne Y. Stringfield, The meeting will be closed to the Director, Office of Federal Advisory National Institute of Child Health and Committee Policy. Human Development; Notice of Closed public in accordance with the provisions set forth in sections [FR Doc. 03–5983 Filed 3–12–03; 8:45 am] Meeting 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., BILLING CODE 4140–01–M Pursuant to section 10(d) of the as amended. The grant applications and Federal Advisory Committee Act, as the discussions could disclose DEPARTMENT OF HEALTH AND amended (5 U.S.C. Appendix 2), notice confidential trade secrets or commercial HUMAN SERVICES is hereby given of the following property such as patentable material, meeting. and personal information concerning National Institutes of Health The meeting will be closed to the individuals associated with the grant public in accordance with the applications, the disclosure of which National Institute of Child Health and provisions set forth in sections would constitute a clearly unwarranted Human Development; Notice of Closed 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., invasion of personal privacy. Meeting as amended. The grant applications and Name of Committee: National Institute of Pursuant to section 10(d) of the the discussions could disclose Allergy and Infectious Diseases Special Federal Advisory Committee Act, as confidential trade secrets or commercial Emphasis Panel, Biodefense and Emerging amended (5 U.S.C. Appendix 2), notice property such as patentable material, Infectious Disease Opportunities. is hereby given of the following and personal information concerning Date: April 7, 2003. meeting. individuals associated with the grant Time: 12 p.m. to 2 p.m. The meeting will be closed to the applications, the disclosure of which Agenda: To review and evaluate grant public in accordance with the would constitute a clearly unwarranted applications. provisions set forth in sections invasion of personal privacy. Place: 6700 B Rockledge Dr., Room 3114, Bethesda, MD 20892, (Telephone Conference 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., Name of Committee: National Institute of Call). as amended. The grant applications and Child Health and Human Development Contact Person: Alec Ritchie, PhD, the discussions could disclose Special Emphasis Panel, Pilot Clinical Trials Scientific Review Administrator, Scientific confidential trade secrets or commercial in the Epidemiology, Prevention and Treatment of Respiratory Failure in Children. Review Program, Division of Extramural property such as patentable material, Activities, NIAD/NIH/DHHS, 6700 B and personal information concerning Date: April 4, 2003. Time: 8:30 a.m. to 5 p.m. Rockledge Drive, MSC 7616, Bethesda, MD individuals associated with the grant Agenda: To review and evaluate grant 20892–7616, 301–435–1614, applications, the disclosure of which applications. [email protected]. would constitute a clearly unwarranted Place: Holiday Inn Select Bethesda, 8120 invasion of personal privacy. Wisconsin Ave., Bethesda, MD 20814. (Catalogue of Federal Domestic Assistance Program Nos. 93.855, Allergy, Immunology, Name of Committee: National Institute of Contact Person: Gopal M. Bhatnagar, PhD, and Transplantation Research; 93.856, Child Health and Human Development Scientific Review Administrator, National Special Emphasis Panel, Assistive Institute of Child Health and Human Microbiology and Infectious Diseases Technology. Development, National Institutes of Health, Research, National Institutes of Health, HHS) Date: April 4, 2003. 6100 Bldg., Rm. 5B01, Rockville, MD 20852, Dated: March 5, 2003. (301) 435–6889, [email protected]. Time: 9 a.m. to 10:30 p.m. LaVerne Y. Stringfield, Agenda: To review and evaluate grant (Catalogue of Federal Domestic Assistance Director, Office of Federal Advisory applications. Program Nos. 93.209, Contraception and Committee Policy. Place: National Institutes of Health, 6100 Infertility Loan Repayment Program; 93.864, Executive Boulevard, Rockville, MD 20852, Population Research; 93.865, Research for [FR Doc. 03–5987 Filed 3–12–03; 8:45 am] (Telephone Conference Call). Mothers and Children; 93.929, Center for BILLING CODE 4140–01–M

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DEPARTMENT OF HEALTH AND Board of Scientific Counselors, national Assistance, National Institutes of Health, HUMAN SERVICES Library of Medicine. HHS) The meeting will be open to the Dated: March 5, 2003. National Institutes of Health public as indicated below, with LaVerne Y. Stringfield, attendance limited to space available. Director, Office of Federal Advisory National Institute of Allergy and Individuals who plan to attend and Committee Policy. Infectious Diseases; Notice of Closed need special assistance, such as sign [FR Doc. 03–5974 Filed 3–11–03; 8:45 am] Meeting language interpretation or other BILLING CODE 4140–01–M Pursuant to section 10(d) of the reasonable accommodations, should Federal Advisory Committee Act, as notify the Contact Person listed below amended (5 U.S.C. Appendix 2), notice in advance of the meeting. DEPARTMENT OF HEALTH AND is hereby given of the following The meeting will be closed to the HUMAN SERVICES meeting. public in accordance with the The meeting will be closed to the provisions set forth in sections National Institutes of Health public in accordance with the 552b(c)(6), Title 5 U.S.C. as amended. for the review, discussion, and National Library of Medicine; Notice of provisions set forth in sections Meeting 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., evaluation of individual intramural as amended. The contract proposals and programs and projects conducted by the National Library of Medicine, including Pursuant to section 10(d) of the the discussions could disclose Federal Advisory Committee Act, as confidential trade secrets or commercial consideration of personnel qualifications and performance, and the amended (5 U.S.C. Appendix 2), notice property such as patentable material, is hereby given of a meeting of the and personal information concerning competence of individual investigators, the disclosure of which would Board of Scientific Counselors, National individuals associated with the contract Library of Medicine. proposals, the disclosure of which constitute a clearly unwarranted invasion of personal privacy. The meeting will be open to the would constitute a clearly unwarranted public as indicated below, with invasion of personal privacy. Name of Committee: Board of Scientific attendance limited to space available. Counselors, National Library of Medicine, Name of Committee: National Institute of Board of Scientific Counselors, National Individuals who plan to attend and Allergy and Infectious Diseases Special Center for Biotechnology Information, need special assistance, such as sign Emphasis Panel, In Vitro Antiviral Screening National Library of Medicine. language interpretation or other Program PART D: Orthopoxviruses and Date: April 22, 2003. reasonable accommodations, should Hemorrhagic Fever. Open: 9 a.m. to 12 p.m. notify the Contact Person listed below Date: March 27, 2003. Agenda: Program Discussion. Time: 8:30 a.m. to 5 p.m. in advance of the meeting. Place: National Library of Medicine, The meeting will be closed to the Agenda: To review and evaluate contract Building 38, Board Room, 8600 Rockville proposals. Pike, Bethesda, MD 20894. public as indicated below in accordance Place: Marriott Washingtonian Center with the provisions set forth in section Closed: 12 p.m. to 2 p.m. (RIO), 9751 Washingtonian Boulevard, The 552b(c)(6), Title 5 U.S.C., as amended Board Room, Gaithersburg, MD 20878. Agenda: To review and evaluate personal qualifications and performance, and for the review, discussion, and Contact Person: Vassil St. Georgiev, PhD, evaluation of individual intramural Scientific Review Administrator, Scientific competence of individual investigators. Review Program, Division of Extramural Place: National Library of Medicine, programs and projects conducted by the Activities, NIAID/NIH/DHHS, Room 2102, Building 28, Board Room, 8600 Rockville National Library of Medicine, including 6700–B Rockledge Drive, MSC 7616, Pike, Bethesda, MD 20894. consideration of personnel Bethesda, MD 20892, 301–496–2550, Open: 2 p.m. to 5 p.m. qualifications and performance, and the [email protected]. Agenda: Program Discussion. competence of individual investigators, (Catalogue of Federal Domestic Assistance Place: National Library of Medicine, the disclosure of which would Program Nos. 93.855, Allergy, Immunology, Building 38, Board Room 8600 Rockville constitute a clearly unwarranted and Transplantation Research; 93.856, Pike, Bethesda, MD 20894. invasion of personal privacy. Microbiology and Infectious Diseases Contact Person: David J. Lipman, MD, Name of Committee: Board of Scientific Research, National Institutes of Health, HHS) Director, Natl Ctr for Biotechnology Information, National Library of Medicine, Counselors, National Library of Medicine, Dated: March 5, 2003. Department of Health and Human Services, Board of Scientific Counselors, Lister Hill LaVerne Y. Stringfield, Bethesda, MD 20894. Center. Date: May 15–16, 2003. Director, Office of Federal Advisory Any interested person may file Open: May 15, 2003 9 a.m. to 1 p.m. Committee Policy. written comments with the committee Agenda: Review of research and [FR Doc. 03–5988 Filed 3–12–03; 8:45 am] by forwarding the statement to the development programs and preparation of BILLING CODE 4140–01–M Contact Person listed on this notice. The reports of the Lister Hill National Center for statement should include the name, Biomedical Communications. address, telephone number and when Place: National Library of Medicine, DEPARTMENT OF HEALTH AND applicable, the business or professional Building 38, Board Room, 2E17, 8600 HUMAN SERVICES affiliation of the interested person. Rockville Pike, Bethesda, MD 20894. In the interest of security, NIH has Closed: May 15, 2003, 1 p.m. 2 p.m. National Institutes of Health instituted stringent procedures for Agenda: To review and evaluate personal entrance into the building by non- qualifications and performance, and National Library of Medicine; Notice of government employees. Persons without competence of individual investigators. Meeting Place: National Library of Medicine, a government I.D. will need to show a Building 38, Board Room, 2E17, 8600 Pursuant to section 10(d) of the photo I.D. and sign-in at the security Rockville Pike, Bethesda, MD 20894. Federal Advisory Committee Act, as desk upon entering the building. Open: May 15, 2003 2 p.m. to 5 p.m. amended (5 U.S.C. Appendix 2), notice (Catalogue of Federal Domestic Assistance Agenda: Review of research and is hereby given of a meeting of the Program Nos. 93.879, Medical Library development programs and preparation of

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reports of the Lister Hill National Center for Name of Committee: Center for Scientific limitations imposed by the review and Biomedical Communications. Review Special Emphasis Panel, AIDS funding cycle. Place: National Library of Medicine, Behavioral Studies SBIR Applications. Name of Committee: Center for Scientific Building 38, Board Room, 2E17, 8600 Date: March 12, 2003. Review Special Emphasis Panel, ZRG1 VACC Rockville Pike, Bethesda, MD 20894. Time: 8:30 a.m. to 12:30 p.m. 01: Infectious Disease Vaccines. Open May 16, 2003, 9 a.m. to 12 p.m Agenda: To review and evaluate grant Date: March 17–18, 2003. Agenda: To review and evaluate personal applications. Time: 2 p.m. to 6 p.m. qualifications and performance, and Place: Governor’s House Hotel, 1615 Rhode Agenda: To review and evaluate grant competence of individual investigators. Island Avenue, NW, Washington, DC 20036. applications. Place: National Library of Medicine, Contact Person: Ranga V. Srinivas, PhD, Place: Hyatt Regency Bethesda, One Building 38, Board Room, 2E17, 8600 Scientific Review Administrator, Center for Bethesda Metro Center, 7400 Wisconsin Rockville Pike, Bethesda, MD 20894. Scientific Review, National Institutes of Avenue, Bethesda, MD 20814. Contact Person: Jackie Duley, Program Health, 6701 Rockledge Drive, Room 5222, Contact Person: Mary Clare Walker, PhD, Assistant, Lister Hill National Center for MSC 7852, Bethesda, MD 20892, (301) 435– Scientific Review Administrator, Center for Biomedical Communications, National 1167, [email protected]. Scientific Review, National Institutes of Library of Medicine, Bldg 38A, RM 7N–705, This notice is being published less than 15 Health, 6701 Rockledge Drive, Room 5104, Bethesda, MD 301–496–4441. days prior to the meting due to the timing MSC 7852, Bethesda, MD 20892, (301) 435– limitations imposed by the review and 1165. Any interested person may file funding cycle. This notice is being published less than 15 written comments with the committee Name of Committee: Center for Scientific days prior to the meeting due to the timing by forwarding the statement to the Review Special Emphasis Panel, Review of limitations imposed by the review and Contact Person listed on this notice. The AIDS Behavioral Studies Member Conflicts. funding cycle. statement should include the name, Date: March 12, 2003. Name of Committee: Center for Scientific address, telephone number and when Time: 12:30 p.m. to 6 p.m. Review Special Emphasis Panel, Cognition applicable, the business or professional Agenda: To review and evaluate grant and Language. affiliation of the interested person. applications. Date: March 18, 2003. In the interest of security. NIH has Place: Governor’s House Hotel, 1615 Rhode Time: 4 p.m. to 6 p.m. Island Avenue, NW, Washington, DC 20036. Agenda: To review and evaluate grant instituted stringent procedures for Contact Person: Ranga V. Srinivas, PhD, applications. entrance into the building by non- Scientific Review Administrator, Center for Place: National Institutes of Health, 6701 government employees. Persons without Scientific Review, National Institutes of Rockledge Drive, Bethesda, MD 20892, a government I.D. will need to show a Health, 6701 Rockledge Drive, Room 5222, (Telephone Conference Call). photo I.D. and sign-in at the security MSC 7852, Bethesda, MD 20892, (301) 435– Contact Person: Cheri Wiggs, PhD, desk upon entering the building. 1167, [email protected]. Scientific Review Administrator, Center for This notice is being published less than 15 Scientific Review, National Institutes of (Catalogue of Federal Domestic Assistance days prior to the meeting due to the timing Health, 6701 Rockledge Drive, Room 3180, Program Nos. 93.879, Medical Library limitations imposed by the review and MSC 7848, Bethesda, MD 20892, (301) 435– Assistance, National Institutes of Health, funding cycle. 1261. HHS) This notice is being published less than 15 Dated: March 5, 2003. Name of Committee: AIDS and Related Research Integrated Review Group, AIDS and days prior to the meeting due to the timing LaVerne Y. Stringfield, Related Research 6. limitations imposed by the review and Director, Office of Federal Advisory Date: March 17–18, 2003. funding cycle. Committee Policy. Time: 8 a.m. to 4 p.m. Name of Committee: Center for Scientific [FR Doc. 03–5975 Filed 3–12–03; 8:45 am] Agenda: To review and evaluate grant Review Special Emphasis Panel, Genomics BILLING CODE 4140–01–M applications and/or proposals. and Bioengineering. Place: Latham Hotel, 3000 M Street, NW, Date: March 20, 2003. Washington, DC 20007. Time: 9 a.m. to 5 p.m. DEPARTMENT OF HEALTH AND Contact Person: Ranga V. Srinivas, PhD, Agenda: To review and evaluate grant HUMAN SERVICES Scientific Review Administrator, Center for applications. Scientific review, National Institutes of Place: American Inn of Bethesda, 8130 National Institutes of Health Health, 6701 Rockledge Drive, Room 5108, Wisconsin Ave., Bethesda, MD 20814. MSC 7852, Bethesda, MD 20892, (301) 435– Contact Person: David J. Remondini, PhD, Center for Scientific Review; Notice of 1167. [email protected]. Scientific Review Administrator, Center for This notice is being published less than 15 Scientific Review, National Institutes of Closed Meetings days prior to the meeting due to the timing Health, 6701 Rockledge Drive, Room 6154, Pursuant to section 10(d) of the limitations imposed by the review and MSC 7890, Bethesda, MD 20892, (301) 435– Federal Advisory Committee Act, as funding cycle. 1038, djr@helix,nih.gov. Name of Committee: Center for Scientific This notice is being published less than 15 amended (5 U.S.C. Appendix 2), notice days prior to the meeting due to the timing is hereby given of the following Review Special Emphasis Panel, Member Reviews in Mental Disorders. limitations imposed by the review and meetings. Date: March 17, 2003. funding cycle. The meetings will be closed to the Time: 2 p.m. to 4 p.m. Name of Committee: Center for Scientific public in accordance with the Agenda: To review and evaluate grant Review Special Emphasis Panel, Learning provisions set forth in sections applications. and Memory; Cellular and Molecular 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., Place: National Institutes of Health, 6701 Mechanisms. as amended. The grant applications and Rockledge Drive, Bethesda, MD 20892, Date: March 20, 2003. the discussions could disclose (Telephone Conference Call). Time: 12 p.m. to 3 p.m. confidential trade secrets or commercial Contact Person: Mary Sue Krause, MED, Agenda: To review and evaluate grant property such as patentable material, Scientific Review Administrator, Center for applications. Scientific Review, National Institutes of Place: National Institutes of Health, 6701 and personal information concerning Health, 6701 Rockledge Drive, Room 3182, Rockledge Drive, Bethesda, MD 20892, individuals associated with the grant MSC 7848. Bethesda, MD 20892, (301) 435– (Telephone Conference Call). applications, the disclosure of which 0902, [email protected]. Contact Person: John Bishop, PhD, would constitute a clearly unwarranted This notice is being published less than 15 Scientific Review Administrator, Center for invasion of personal privacy. days prior to the meeting due to the timing Scientific Review, National Institutes of

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Health, 6701 Rockledge Drive, Room 5180, Contact Person: John Bishop, PhD, Contact Person: Joanne T Fujii, PhD, MSC 7844, Bethesda, MD 20892, (301) 435– Scientific Review Administrator, Center for Scientific Review Administrator, Center for 1250. Scientific Review, National Institutes of Scientific Review, National Institutes of This notice is being published less than 15 Health, 6701 Rockledge Drive, Room 5180, Health, 6701 Rockledge Drive, Room 5204, days prior to the meeting due to the timing MSC 7844, Bethesda, MD 20892, (301) 435– MSC 7850, Bethesda, MD 20892, (301) 435– limitations imposed by the review and 1250. 1178, [email protected]. funding cycle. This notice is being published less than 15 Name of Committee: Center for Scientific Name of Committee: Center for Scientific days prior to the meeting due to the timing Review Special Emphasis Panel, ZRG MBC– Review Special Emphasis Panel, Drug limitations imposed by the review and 1 (29) DBBD F 31 SEP. Prevention and Smoking Cessation. funding cycle. Date: March 26–27, 2003. Date: March 21, 2003. Name of Committee: Center for Scientific Time: 8:30 a.m. to 5 p.m. Time: 8:30 a.m. to 5 p.m. Review Special Emphasis Panel, Member Agenda: To review and evaluate grant Agenda: To review and evaluate grant Reviews in Treatment of Depression. applications. applications. Date: March 24, 2003. Place: One Washington Circle Hotel, One Place: Holiday Inn Georgetown, 2101 Time: 1 p.m. to 2 p.m. Washington Circle, Washington, DC 20037. Wisconsin Avenue, NW., Washington, DC Agenda: To review and evaluate grant Contact Person: Neal B. West, PhD, 20007. applications. Program Officer, Center for Scientific Review, Contact Person: Karen Sirocco, PhD, Place: National Institutes of Health, 6701 National Institutes of Health, 6701 Rockledge Scientific Review Administrator, Center for Rockledge Drive, Bethesda, MD 20892, Drive, Room 3202, MSC 7808, Bethesda, MD Scientific Review, National Institutes of (Telephone Conference Call). 20892–7808, 301–435–2514, Health, 6701 Rockledge Drive, Room 3176, Contact Person: Mary Sue Krause, MED, [email protected]. MSC 7848, Bethesda, MD 20892, (301) 435– Scientific Review Administrator, Center for Name of Committee: Center for Scientific 0676, [email protected]. Scientific Review, National Institutes of Review Special Emphasis Panel, Polyoma This notice is being published less than 15 Health, 6701 Rockledge Drive, Room 3182, Transformation. days prior to the meeting due to the timing MSC 7848, Bethesda, MD 20892, (301) 435– Date: March 26, 2003. limitations imposed by the review and 0902, [email protected]. Time: 1 p.m. to 3 p.m. funding cycle. This notice is being published less than 15 Agenda: To review and evaluate grant Name of Committee: Center for Scientific days prior to the meeting due to the timing applications. Review Special Emphasis Panel, ZRG1 limitations imposed by the review and Place: National Institutes of Health, 6701 PBC(3) MIMS Resource Review. funding cycle. Rockledge Drive, Bethesda, MD 20892, Date: March 23–25, 2003. Name of Committee: Center for Scientific (Telephone Conference Call). Time: 5 p.m. to 5 p.m. Review Special Emphasis Panel, Diagnosis of Contact Person: Michael R. Schaefer, PhD, Agenda: To review and evaluate grant Mental Disorders. Scientific Review Administrator, Genetic applications. Date: March 24, 2003. Sciences IRG, Center for Scientific Review, Place: Hotel at Massachusetts Institute of Time: 2:30 p.m. to 4:30 p.m. National Institute of Health, 6701 Rockledge Technology, 20 Sidney Street, Boston, MA Drive, Room 6166, MSC 7890, Bethesda, MD 02139. Agenda: To review and evaluate grant applications. 20892, (301) 435–2477, Contact Person: Zakir Bengali, PhD, [email protected].?≤ Scientific Review Administrator, Center for Place: National Institutes of Health, 6701 Scientific Review, National Institutes of Rockledge Drive, Bethesda, MD 20892, Name of Committee: Center for Scientific Health, 6701 Rockledge Drive, Room 5150, (Telephone Conference Call). Review Special Emphasis Panel, Polyoma MSC 7842, Bethesda, MD 20892, (301) 435– Contact Person: Mary Sue Krause, MED, Transformation. 1742. Scientific Review Administrator, Center for Date: March 26, 2003. This notice is being published less than 15 Scientific Review, National Institutes of Time: 1 p.m. to 3 p.m. days prior to the meeting due to the timing Health, 6701 Rockledge Drive, Room 3182, Agenda: To review and evaluate grant limitations imposed by the review and MSC 7848, Bethesda, MD 20892, 301–435– applications. funding cycle. 0902, [email protected]. Place: National Institutes of Health, One This notice is being published less than 15 Democracy Plaza, 6701 Democracy Name of Committee: AIDS and Related days prior to the meeting due to the timing Boulevard, Bethesda, MD 20892, (Telephone Research Integrated Review Group; AIDS and limitations imposed by the review and Conference Call). Related Research 1. funding cycle. Contact Person: Jean Hickman, PhD, Date: March 24–25, 2003. Scientific Review Administrator, Center for Time: 8 a.m. to 6 p.m. Name of Committee: Center for Scientific Scientific Review, National Institutes of Agenda: To review and evaluate grant Review Special Emphasis Panel, ZRG1–DMG Health, 6701 Rockledge Drive, Room 4194, applications. 90S: Diagnostic Imaging. MSC 7808, Bethesda, MD 20892, (301) 435– Place: Latham Hotel, 3000 M Street, NW., Date: March 25, 2003. Washington, DC 20007. Time: 2 p.m. to 3 p.m. 1146. Contact Person: Kenneth Roebuck, PhD, Agenda: To review and evaluate grant Name of Committee: Center for Scientific Scientific Review Administrator, Center for applications. Review Special Emphasis Panel, Biochemical Scientific Review, National Institutes of Place: National Institutes of Health, 6701 Pharmacology fo Alcohol. Health, 6701 Rockledge Drive, Room 5106, Rockledge Drive, Bethesda, MD 20892, Date: March 26, 2003. MSC 7852, Bethesda, MD 20892, (301) 435– (Telephone Conference Call). Time: 2 p.m. to 4:30 p.m. 1166, [email protected]. Contact Person: Lee Rosen, PhD, Scientific Agenda: To review and evaluate grant This notice is being published less than 15 Review Administrator, Center for Scientific applications. days prior to the meeting due to the timing Review, National Institutes of Health, 6701 Place: National Institutes of Health, 6701 limitations imposed by the review and Rockledge Drive, Room 5116, MSC 7854, Rockledge Drive, Bethesda, MD 20892, funding cycle. Bethesda, MD 20892, (301) 435–1171. (Telephone Conference Call). Name of Committee: Center for Scientific Name of Committee: Center for Scientific Contact Person: Gamil C Debgas, PhD, Review Special Emphasis Panel, Review Special Emphasis Panel, MDCN Scientific Review Administrator, Center for Computational Neuroscience. Fellowship Review Group A—Development, Scientific Review, National Institutes of Date: March 24, 2003. Synaptic Plasticity and Neurodegeneration. Health, 6701 Rockledge Drive, Room 5170, Time: 11 a.m. to 1 p.m. Date: March 26–27, 2003. MSC 7844, Bethesda, MD 20892, (301) 435– Agenda: To review and evaluate grant Time: 8 a.m. to 5 p.m. 1247, [email protected]. applications. Agenda: To review and evaluate grant Name of Committee: Center for Scientific Place: National Institutes of Health, 6701 applications. Review Special Emphasis Panel Physics. Rockledge Drive, Bethesda, MD 20892, Place: Churchill Hotel, 1914 Connecticut Date: March 26, 2003. (Telephone Conference Call). Avenue, NW., Washington, DC 20009. Time: 3 p.m. to 5 p.m.

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Agenda: To review and evaluate grant Name of Committee: Center for Scientific Center for Scientific Review, National applications. Review Special Emphasis Panel, ZRG1 PTHB Institutes of Health, 6701 Rockledge Drive, Place: National Institutes of Health, 6701 03 M:. Room 5120, MSC 7854, Bethesda, MD 20892, Rockledge Drive, Bethesda, MD 20892, Date: March 27, 2003. (301) 435–1179, [email protected]. (Telephone Conference Call). Time: 1 p.m. to 3p.m. Name of Committee: Center for Scientific Contact Person: Paul K. Strudler, PhD, Agenda: To review and evaluate grant Review Special Emphasis Panel, Leukemia Scientific Review Administrator, Center for applications. Virus. Scientific Review, National Institutes of Place: National Institutes of Health, 6701 Date: March 27, 2003. Health, 6701 Rockledge Drive, Room 6186, Rockledge Drive, Bethesda, MD 20892, Time: 5 p.m. to 6 p.m. MSC 7804, Bethesda, MD 20892, (301) 435– (Telephone Conference Call). Agenda: To review and evaluate grant 1716, [email protected]. Contact Person: Martin L. Padarathsingh, applications. Name of Committee: Center for Scientific PhD, Scientific Review Administrator, Center Place: National Institutes of Health, 6701 Review Special Emphasis Panel, SNEM 1 for Scientific Review, National Institutes of Rockledge Drive, Bethesda, MD 20892, Member Conflict: Community Level Health Health, 6701 Rockledge Drive, Room 6212, (Telephone Conference Call). Promotion. MSC 7804, Bethesda, MD 20892, (301) 435– Contact Person: Angela Y. Ng, PhD, MBA, Date: March 26, 2003. 1717. Scientific Review Administrator, Center for Time: 4 p.m. to 6 p.m. Name of Committee: Center for Scientific Scientific Review, National Institutes of Agenda: To review and evaluate grant Review Special Emphasis Panel, Genomics. Health, 6701 Rockledge Drive, Room 6200, applications. Date: March 27, 2003. MSC 7804, (For courier delivery, use MD Place: National Institutes of Health, 6701 Time: 2 p.m. to 4 p.m. 20817), Bethesda, MD 20892, 301–435–1715, Rockledge Drive, Bethesda, MD 20892, Agenda: To review and evaluate grant [email protected]. (Telephone Conference Call). applications. Name of Committee: Center for Scientific Contact Person: Gerturde K. McFarland, Place: National Institutes of Health, 6701 Review Special Emphasis Panel, ZRG1 SRB DNSC, FAAN, Scientific Review Rockledge Drive, Bethesda, MD 20892, 52R:PAR01–102: In Vivo Imaging Administrator, Center for Scientific Review, (Telephone Conference Call). Technology:SBIR/STTR. National Institutes of Health, 6701 Rockledge Contact Person: Camilla E. Day, PhD, Date: March 28, 2003. Scientific Review Administrator, Center for Drive, Room 3156, MSC 7770, Bethesda, MD Time: 8 a.m. to 5 p.m. Scientific Review, National Institutes of 20892, (301) 435–1784, [email protected]. Agenda: To review and evaluate grant Health, 6701 Rockledge Drive, Room 2212, applications. Name of Committee: Center for Scientific MSC 7890, Bethesda, MD 20892, (301) 435– Place: Holiday Inn Select Bethesda, 8120 Review Special Emphasis Panel, ZRG1 SRB 1037, [email protected]. Wisconsin Ave, Bethesda, MD 20814. 51R:PAR 01–101: In Vivo Imaging Name of Committee: Center for Scientific Contact Person: Eileen W Bradley, DSC, Technology: Phased Innovation AWD. Review Special Emphasis Panel, Member Chief and Scientific Review Administrator, Date: March 27, 2003. Conflict: Behavioral Genetics and Mental Center for Scientific Review, National Time: 8 a.m. to 3 p.m. Health (SNEM 2 Members). Institutes of Health, 6701 Rockledge Drive, Agenda: To review and evaluate grant Date: March 27, 2003. Room 5120, MSC 7854, Bethesda, MD 20892, applications. Time: 2:15 p.m. to 4 p.m. (301) 435–1179, [email protected]. Place: Holiday Inn Select Bethesda, 8120 Agenda: To review and evaluate grant Name of Committee: Center for Scientific Wisconsin Ave, Bethesda, MD 20814. applications. Review Special Emphasis Panel, Models of Contact Person: Eileen W Bradley, DSC, Place: National Institutes of Health, 6701 Carcinogenecis and Prevention. Chief and Scientific Review Administrator, Rockledge Drive, 3158–F, Bethesda, MD Date: March 28, 2003. Center for Scientific Review, National 20892, (Telephone Conference Call). Time: 1:30 p.m. to 4 p.m. Institutes of Health, 6701 Rockledge Drive, Contact Person: Ann Hardy, DRPH, Agenda: To review and evaluate Grant Room 5120, MSC 7854, Bethesda, MD 20892, Scientific Review Administrator, Center for applications. (301) 435–1179, [email protected]. Scientific Review, National Institutes of Place: National Institutes of Health, 6701 Name of Committee: Center for Scientific Health, 6701 Rockledge Drive, Room 3158, Rockledge Drive, Bethesda, MD 20892, Review Special Emphasis Panel, ZRG1 SSS2 MSC 7770, Bethesda, MD 20892, (301) 435– (Telephone Conference Call). (10B) Proteomics, Protein Expression, and 0695, [email protected]. Contact Person: Elaine Sierra-Rivera, PhD, Protein Therapeutics. Name of Committee: Center for Scientific Scientific Review Administrator, Center for Date: March 27–28, 2003. Review Special Emphasis Panel, ZRG1 SRB Scientific Review, National Institutes of Time: 8:30 a.m. to 3 p.m. 54R:PAR01–101: In Vivo Imaging Health, 6701 Rockledge Drive, Room 6184, Agenda: To review and evaluate grant Technology: Member Conflict. MSC 7804, Bethesda, MD 20892, 301–435– applications. Date: March 27, 2003. 1779, [email protected]. Place: Holiday Inn Chevy Chase, 5520 Time: 3 p.m. to 4:30 p.m. Name of Committee: Center for Scientific Wisconsin Ave, Chevy Chase, MD 20815. Agenda: To review and evaluate grant Review Special Emphasis Panel, Behavioral Contact Person: Prabha L. Atreya, PhD, applications. Neuroendocrinology. Scientific Review Administrator, Center for Place: Holiday Inn Select Bethesda, 8120 Date: March 28, 2003. Scientific Review, National Institutes of Wisconsin Ave, Bethesda MD 20814. Time: 2 p.m. to 4:30 p.m. Health, 6701 Rockledge Drive, Room 5156, Contact Person: Eileen W Bradley, DSC, Agenda: To review and evaluate grant MSC 7842, Bethesda, MD 20892, (301) 435– Chief and Scientific Review Administrator, applications. 8367, [email protected]. Center for Scientific Review, National Place: National Institutes of Health, 6701 Name of Committee: Center for Scientific Institutes of Health, 6701 Rockledge Drive, Rockledge Drive, Bethesda, MD 20892, Review Special Emphasis Panel, Diagnosis Room 5120, MSC 7854, Bethesda, MD 20892, (Telephone Conference Call). and Treatment of Cancer. (301) 435–1179, [email protected]. Contact Person: Gamil C Debbas, PhD, Date: March 27–28, 2003. Name of Committee: Center for Scientific Scientific Review Administrator, Center for Time: 8:30 a.m. to 5:30 p.m. Review Special Emphasis Panel, ZRG1 SRB Scientific Review, National Institutes of Agenda: To review and evaluate grant 53R:PAR01–101: In Vivo Imaging Health, 6701 Rockledge Drive, Room 5170, applications. Technology: Member Conflict. MSC 7844, Bethesda, MD 20892, (301) 435– Place: Holiday Inn Select Bethesda, 8120 Date: March 27, 2003. 1247, [email protected]. Wisconsin Ave, Bethesda, MD 20814. Time: 4:30 p.m. to 5 p.m. Name of Committee: Center for Scientific Contact Person: Shen K. Yang, PhD, Agenda: To review and evaluate grant Review Special Emphasis Panel, Nutritional Scientific Review Administrator, Center for applications. Metabolism. Scientific Review, National Institutes of Place: Holiday Inn Select Bethesda, 8120 Date: March 28, 2003. Health, 6701 Rockledge Drive, Room 6198, Wisconsin Ave, Bethesda, MD 20814. Time: 12 p.m. to 2 p.m. MSC 7804, Bethesda, MD 20892, (301) 435– Contact Person: Eileen W Bradley, DSC, Agenda: To review and evaluate grant 1213, [email protected]. Chief and Scientific Review Administrator, applications.

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Place: National Institutes of Health, 6701 1973, as amended (16 U.S.C. 1531 et liquor on the Confederated Tribes of the Rockledge Drive, Bethesda, MD 20892, seq.): Coos, Lower Umpqua and Siuslaw (Telephone Conference Call). Indians (Tribes’) Reservation and other Contact Person: Dennis Leszczynski, PhD, PRT–697823 Scientific Review Administrator, Center for lands subject to tribal jurisdiction, in Scientific Review, National Institutes of Applicant: Assistant Regional Director, conformity with the laws of the State of Health, 6701 Rockledge Drive, Room 6170, Ecological Services, U.S. Fish and Oregon, where applicable and MSC 7892, Bethesda, MD 20892, (301) 435– Wildlife Service, Hadley, necessary. Although the Code was 1044. Massachusetts adopted on December 9, 2001, it does Name of Committee: Center for Scientific DATES: Written data or comments on not become effective until published in Review Special Emphasis Panel, Chemical this application must be received at the the Federal Register because the failure Senses: Olfaction. to comply with the Code may result in Date: March 31, 2003. address given below by April 14, 2003. Time: 1 p.m. to 3 p.m. ADDRESSES: Documents and other criminal charges. Agenda: To review and evaluate grant information submitted with this EFFECTIVE DATE: This Code is effective applications. application are available for review by March 13, 2003. Place: National Institutes of Health, 6701 any party who submits a written request Rockledge Drive, Bethesda, MD 20892, for a copy of such documents to the FOR FURTHER INFORMATION CONTACT: (Telephone Conference Call). following office within 30 days of the Duane Bird Bear, Office of Tribal Contact Person: John Bishop, PhD, date of publication of this notice: U.S. Services, Branch of Tribal Relations, Scientific Review Administrator, Center for Scientific Review, National Institutes of Fish and Wildlife Service, 300 Westgate 1951 Constitution Avenue, NW., MS– Health, 6701 Rockledge Drive, Room 5180, Center Drive, Hadley, Massachusetts 320–SIB, Washington, DC 20240–0001; MSC 7844, Bethesda, MD 20892, (301) 435– 01035. Attention: Diane Lynch, Regional Telephone (202) 513–7641. 1250. Endangered Species Permits SUPPLEMENTARY INFORMATION: Under the Name of Committee: Center for Scientific Coordinator. Telephone: (413) 253– Review Special Emphasis Panel, Member 8628; Facsimile: (413) 253–8482. Act of August 15, 1953, Public Law 83– 277, 67 Stat. 586, 18 U.S.C. 1161, as Reviews in Behavioral Pharmacology and FOR FURTHER INFORMATION CONTACT: interpreted by the Supreme Court in Addiction. Diane Lynch, Telephone: (413) 253– Date: March 31, 2003. 8628; Facsimile: (413) 253–8482. Rice v. Rehner, 463 U.S. 713 (1983), the Time: 2 p.m. to 3:30 p.m. Secretary of the Interior shall certify and SUPPLEMENTARY INFORMATION: You are Agenda: To review and evaluate grant publish in the Federal Register notice of invited to comment on the application applications. the adopted liquor ordinances for the Place: National Institutes of Health, 6701 from the Assistant Regional Director, purpose of regulating liquor transactions Rockledge Drive, Bethesda, MD 20892, Ecological Services, PRT–TE697823. (Telephone Conference Call). This applicant requests renewal of their in Indian Country. The Confederated Contact Person: Mary Sue Krause, MED, current permit for take activities for all Tribes of the Coos, Lower Umpqua and Scientific Review Administrator, Center for listed species in the states of Siuslaw Indians Liquor Code, Scientific Review, National Institutes of Connecticut, Delaware, Maine, Resolution No. 01–091, was duly Health, 6701 Rockledge Drive, Room 3182, Maryland, Massachusetts, New adopted by the Confederated Tribes of MSC 7848, Bethesda, MD 20892, 301–435– the Coos, Lower Umpqua and Siuslaw 0902, [email protected]. Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont, Indians Tribal Council on December 9, (Catalogue of Federal Domestic Assistance Virginia, West Virginia and the District 2001. The Tribes wish to establish Program Nos. 93.306, Comparative Medicine, uniform policies to assure a high-quality 93.306; 93.333, Clinical Research, 93.333, of Columbia for the purpose of scientific 93.337, 93.393–93.396, 93.837–93.844, research and enhancement of workforce, ensure the protection of 93.846–93.878, 93.892, 93.893, National propagation or survival of the species as employee rights and set forth the Institutes of Health, HHS) prescribed by U.S. Fish and Wildlife expectations of all employees and Dated: March 5, 2003 Service recovery documents. managers in conducting employee LaVerne Y. Stringfield, Dated: February 26, 2003. relations matters. Director, Office of Federal Advisory Richard O. Bennett, This notice is published in Committee Policy. Acting Regional Director. accordance with the authority delegated [FR Doc. 03–5989 Filed 3–12–03; 8:45 am] [FR Doc. 03–6041 Filed 3–12–03; 8:45 am] by the Secretary of the Interior to the BILLING CODE 4140–01–M BILLING CODE 4310–55–M Assistant Secretary—Indian Affairs by 209 Department Manual 8.1. I certify that by Resolution No. 01– DEPARTMENT OF THE INTERIOR DEPARTMENT OF THE INTERIOR 091, the Confederated Tribes of the Coos, Lower Umpqua and Siuslaw Fish and Wildlife Service Bureau of Indian Affairs Indians Liquor Control Code was duly Notice of Receipt of Applications for Confederated Tribes of the Coos, adopted by the Confederated Tribes of Renewal for Endangered Species Lower Umpqua and Siuslaw Indians the Coos, Lower Umpqua and Siuslaw Permit Liquor Control Code Indians Tribal Council on December 9, 2001. AGENCY: U.S. Fish and Wildlife Service, AGENCY: Bureau of Indian Affairs, Department of the Interior. Interior. Dated: February 26, 2003. ACTION: Notice of receipt. ACTION: Notice. Aurene M. Martin, Acting Assistant Secretary—Indian Affairs. SUMMARY: The following applicant has SUMMARY: This notice publishes the applied for a permit to conduct certain Confederated Tribes of the Coos, Lower The Confederated Tribes of the Coos, activities with endangered species. This Umpqua and Siuslaw Indians Liquor Lower Umpqua and Siuslaw Indians notice is provided pursuant to section Control Code. The Code regulates the Liquor Control Code, Resolution No. 10(c) of the Endangered Species Act of sale, possession and use of alcoholic 01–091, reads as follows:

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Confederated Tribes of Coos, Lower trade to another any liquor, except for 5–1–5 Sale or Service of Liquor by Umpqua and Siuslaw Indians Liquor those commercial liquor establishments Licensee’s Minor Employees Control Code Title 5—Regulatory on the Tribes’ Reservation licensed by (a) The holder of a license issued Provisions Chapter 5–1 Liquor Control the Tribes, provided, however, that a under this Code or Oregon Revised person may transport liquor from a 5–1–1 Authority and Purpose Statutes chapter 472 may employ licensed establishment consistent with persons 18, 19 and 20 years of age who (a) The authority for this Code and its the terms of the license. may take orders for, serve and sell adoption by Tribal Council is found in (c) It shall be unlawful for any person alcoholic liquor in any part of the the Confederated Tribes of Coos, Lower to consume alcoholic liquor on a public licensed premises when that activity is Umpqua and Siuslaw Indians Tribal highway. incidental to the serving of food except Constitution under Article I—section 1, (d) It shall be unlawful for any person in those areas classified by the Oregon Article VI—section 2 and the Act of to publicly consume any alcoholic Liquor Control Commission as being October 17, 1984, Public Law 98–481, liquor at any community function, or at prohibited to the use of minors. 98 Stat. 2250. or near any place of business, Indian (b) This Code is for the purpose of However, no person who is 18, 19 or 20 celebration grounds, recreational areas, years of age shall be permitted to mix, regulating the sale, possession and use including ballparks and public camping of alcoholic liquor on the Confederated pour or draw alcoholic liquor except areas, the Tribal Headquarters area and when pouring is done as a service to the Tribes of Coos, Lower Umpqua and any other area where minors gather for Siuslaw Indians (Tribes’) Reservation patron at the patron’s table or drawing meetings or recreation, except within a is done in a portion of the premises not and other lands subject to tribal tribally licensed establishment where jurisdiction. prohibited to minors. alcohol is sold. (b) Except as stated in this section, it 5–1–2 Definitions (e) It shall be unlawful for any person shall be unlawful to hire any person to under the age of 21 years to buy, attempt To the extent that definitions are work in connection with the sale and to buy or to misrepresent their age in service of alcoholic beverages in a consistent with tribal or federal law, attempting to buy, alcoholic liquor. It terms used herein shall have the same tribally licensed liquor establishment if shall be unlawful for any person under such person is under the age of 21 years. meaning as defined in Oregon Revised the age of 21 years to transport, possess Statutes Chapter 471 and in Oregon or consume any alcoholic liquor on the 5–1–6 Warning Signs Required Administrative Rules Chapter 845. Tribes’ Reservation, or to be under the (a) Alcoholic Liquor shall mean any (a) Any person in possession of a influence of alcohol or to be at an alcoholic beverage containing more than valid retail liquor license, who sells established commercial liquor one-half of 1 percent alcohol by volume, liquor by the drink for consumption on establishment, except as authorized and every liquid or solid, patented or the premises or sells for consumption under section 5–1–5 of this Code. No not, containing alcohol and capable of off the premises, shall post a sign person shall sell or furnish alcoholic being consumed by a human being. informing the public of the effects and liquor to any minor. (b) Tribes’ Reservation shall mean all risks of alcohol consumption during (f) Alcoholic liquor may not be given lands held in trust by the United States pregnancy. as a prize, premium or consideration for for the Tribes or their members and all (b) The sign shall: a lottery, contest, game of chance or lands owned by the Tribes, wherever (1) Contain the message: ‘‘Pregnancy skill, or competition of any kind. located. and alcohol do not mix. Drinking (c) Sell or To Sell refer to anything 5–1–4 Procedure for License alcoholic beverages, including wine, forbidden by this Chapter and related to coolers and beer, during pregnancy can (a) Any request for a license under alcoholic liquor, they include: cause birth defects.’’ this Code must be presented to the (1) To solicit or receive an order. (2) Be either: Tribal Council at least 30 days prior to 1 (2) To keep or expose for sale. (A) A large sign, no smaller than 8 ⁄2 (3) To deliver for value or in any way the requested effective date. The Tribal by 11 inches in size with lettering no other than purely gratuitously. Council shall set license conditions at smaller than five-eighth of an inch in (4) To peddle. least as strictly as those required by height; or (5) To keep with intent to sell. federal law, including at a minimum: (B) A reduced sign, 5 by 7 inches in (6) To traffic in. (1) Liquor may only be served and size with lettering of the same (7) For any consideration, promise or handled in a manner no less strict than proportion as the large sign described in obtained directly or indirectly under allowed under Oregon Revised Statutes paragraph (A) of this subsection. any pretext or by any means or procure chapter 471. (3) Contain a graphic depiction of the or allow to be procured for any other (2) Liquor may only be served by staff message to assist nonreaders in person. of the licensee; and understanding the message. The (d) Sale includes every act of selling (3) Liquor may only be served in depiction of a pregnant female shall be as defined in paragraph (c) of this rooms where gambling is not taking universal and shall not reflect a specific section. place. race or culture. (b) Council action on a license request (4) Be in English unless a significant 5–1–3 Prohibited Activity must be taken at a regular or special number of the patrons of the retail (a) It shall be unlawful for any person meeting. Unless the request is for a premises use a language other than to sell, trade or manufacture any special event license, the Council shall English as a primary language. In such alcoholic liquor on the Tribes’ give at least 14 days’ notice of the cases, the sign shall be worded both in Reservation except as provided in this meeting at which the request will be English and the primary language or Code. considered. Notice shall be posted at the languages of the patrons. (b) It shall be unlawful for any Tribal Council offices and at the (5) Be displayed on the premises of all business establishment or person on the establishment requesting the license, licensed retail liquor premises as either Tribes’ Reservation to possess, transport and will be sent by Certified Mail to the a large sign at the point of entry, or a or keep with intent to sell, barter or Oregon Liquor Control Commission. reduced sized sign at points of sale.

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(c) The person described in paragraph DEPARTMENT OF THE INTERIOR will aid the BLM in identifying issues, (a) of this section shall also post signs developing a range of alternatives, and of any size at places where alcoholic Bureau of Land Management analyzing environmental impacts. beverages are displayed. [WY–100–03–1310–DB] ADDRESSES: Address questions and 5–1–7 Civil Penalty comments to the Pinedale Field Office, Notice of Intent To Prepare an PO Box 768, Pinedale, Wyoming 82941, (a) Any person who violates the Environmental Impact Statement and phone number 307–367–5300, or send provisions of this Code is deemed to Provide Notice of Public Meeting, them electronically to have consented to the jurisdiction of the Jonah Infill Drilling Project, Sublette [email protected]. Information Tribal Court and may be subject to a County, WY, and Notice of the and a copy of the Scoping Notice for the civil penalty in Tribal Court for a civil Potential for Amendment of the Jonah Infill Drilling Project EIS may be infraction. Such civil penalty shall not Pinedale Resource Management Plan obtained by writing or visiting the BLM exceed the sum of one thousand dollars Pinedale field office. The scoping notice ($1,000) for each such infraction, AGENCY: Bureau of Land Management, will also be posted on the Wyoming provided, however, that the penalty Interior. BLM NEPA Web site, http:// shall not exceed five thousand dollars ACTION: Notice of Intent (NOI) to prepare www.wy.blm.gov/nepa/nepadocs.htm. ($5,000) if it involves minors. an Environmental Impact Statement Written comments may be sent, or hand- (EIS) and to conduct public scoping for delivered, to the BLM Pinedale Field (b) The procedures governing the the Jonah Infill Drilling Project, Sublette Office, 432 East Mill Street, PO Box 768, adjudication in Tribal Court of such County, Wyoming, and Notice of the Pinedale, WY 82941. civil infractions shall be those set out in Potential for Amendment of the Your response is important and will the Trial Court rules. Pinedale Resource Management Plan. be considered in the environmental (c) The Tribal Council hereby analysis process. If you do respond, we specifically finds that such civil SUMMARY: EnCana Oil and Gas (USA) will keep you informed of decisions penalties are reasonably necessary and Inc., BP America, and other natural gas resulting from this analysis. Please note are related to the expense of development companies (hereinafter that public comments and information governmental administration necessary referred to as ‘‘the Operators’’) have submitted regarding this project in maintaining law and order and public submitted to the Bureau of Land including names, e-mail addresses, and safety on the Reservation and in Management (BLM) a proposal to street addresses of the respondents will managing, protecting and developing expand natural gas exploration and be available for public review and the natural resources on the development operations. The Jonah disclosure at the above address during Reservation. It is the legislative intent of Infill Drilling Project is located in an regular business hours (7:45 a.m. to 4:30 the Tribal Council that all violations of area known as the Jonah Field, in p.m.) Monday through Friday, except this Chapter, whether committed by Sublette County, Wyoming. Under the holidays. Individual respondents may tribal members, non-member Indians or provisions of section 102(2)(C) of the request confidentiality. If you wish to non-Indians, be considered civil in National Environmental Policy Act withhold your name, email address, or nature rather than criminal. (NEPA), the BLM announces its street address from public review or intentions to prepare an EIS and to 5–1–8 Severability from disclosure under the Freedom of solicit public comments regarding Information Act, you must state this If a court of competent jurisdiction issues and resource information. Based prominently at the beginning of your finds any provision of this Code to be on the information developed during written comment. Such requests will be invalid or illegal under applicable the course of this analysis, the BLM may honored to the extent allowed by the Federal or Tribal law, such provision decide it is necessary to amend the 1988 law. All submissions from organizations shall be severed from this Code and the Pinedale Resource Management Plan or businesses, and from individuals remainder of this Code shall remain in (RMP). identifying themselves as full force and effect. DATES: This notice initiates the public representatives or officials of scoping process. The BLM can best use organizations or businesses, will be 5–1–9 Consistency With State Law public input if comments and resource made available for public inspection in The Tribes agree to perform in the information are submitted within 45 their entirety. same manner as any other Oregon days of the Publication of FOR FURTHER INFORMATION CONTACT: business entity for the purpose of liquor Environmental Protection Agency’s Eldon Allison, Project Manager, BLM, licensing and regulations, including but (EPA) notice in the Federal Register. A Pinedale Field Office, PO Box 768, not limited to licensing, compliance Scoping Notice will be distributed by Pinedale, Wyoming 82941, telephone with the regulations of the Oregon mail on or about the date of the 307–367–5300. Liquor Control Commission, publication of this notice. Information SUPPLEMENTARY INFORMATION: The Jonah maintenance of liquor liability and a copy of the Scoping Notice may Infill Drilling Project (JIDP) area is insurance, which is incorporated as it is be obtained by writing, or visiting, the located in south-central Sublette County specifically set forth herein, as it may be BLM Pinedale Field Office, address approximately 32 miles southeast of amended from time to time. listed below. Pinedale, and 28 miles northwest of The BLM will host a public meeting Farson, Wyoming. Drilling is proposed 5–1–10 Effective Date within 30 days of the publication of this in Townships 28 and 29 North, Ranges notice. Information regarding date, time, This Code shall be effective upon 107 through 109 West, 6th Principal and location of the meeting will be publication in the Federal Register after Meridian. available from the Pinedale Field Office The operators have submitted to the approval by the Secretary of the Interior and posted on its Web site listed at the BLM a proposal to expand exploration or his designee. end of this Notice. All comments and development of natural gas [FR Doc. 03–6114 Filed 3–12–03; 8:45 am] received at the public meeting, resources in the Jonah Field area, BILLING CODE 4310–4J–P submitted in writing by mail, or e-mail spanning a period of about 25 years. The

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total project area is approximately Species and their habitats; surface and Dated: February 13, 2003. 30,200 acres. This acreage includes groundwater resources; short-term Robert A. Bennett, approximately 28,280 acres of Federal revegetation and restoration of disturbed State Director. surface and mineral estate managed by areas and their long-term stabilization, [FR Doc. 03–6084 Filed 3–12–03; 8:45 am] BLM; 1,280 acres of State of Wyoming including control of noxious weeds; BILLING CODE 4310–22–P surface and minerals; and 640 acres of prehistoric and historic cultural private surface ownership. All of the resources; social and economic effects to privately owned surface acres are split the local communities; wildlife habitat DEPARTMENT OF THE INTERIOR estate (private surface/Federal minerals) and fisheries; nesting raptors; wetlands lands. and riparian areas; visual and landscape Bureau of Land Management The operators’ original proposal to resources; and recreation activities and drill 450 wells in addition to 47 existing opportunities, such as hunting and [WY–030–1310–DB] wells at the same number of locations fishing. was approved by the BLM in the Notice of Intent To Prepare an The BLM has identified the following Environmental Impact Statement and Environmental Assessment, Finding of benefits that may be derived from the No Significant Impact and Decision Conduct Scoping for the Seminoe natural gas development: Increased Road Coalbed Methane Natural Gas Record for the Modified Jonah Field II royalties and tax revenues to local, Natural Gas Project, March 2000 Development Project, Carbon County, State, and Federal governments; Wyoming, and Notice of the Potential (Modified Jonah Field II EA). The additional opportunities for operators now propose to drill 1,250 for Amendment of the Great Divide employment and economic benefits for Resource Management Plan additional wells from 850 well locations communities near the project area; within the same area analyzed in the increases in Wyoming’s share of new AGENCY: Bureau of Land Management, Modified Jonah Field II EA. The and existing natural gas markets; and Interior. operators’ new proposal is based on a 10 development of natural gas resources to ACTION: Notice of Intent (NOI) to prepare to 20 acre down-hole spacing pattern assist in attainment of clean air (32 to 64 wells per aliquot section). The an Environmental Impact Statement objectives in conformance with (EIS) and to conduct scoping for the operators propose to explore known Presidential and Congressional productive formations as well as deeper Seminoe Road Gas Development Project, directives. Carbon County, Wyoming, and Notice of formations that have not been tested. Any authorizations and actions The planned development would the Potential for Amendment of the proposed for approval in the EIS will be include the following associated Great Divide Resource Management evaluated to determine if they conform structures and facilities in addition to Plan (RMP). to the decisions in the 1988 Pinedale the 850 proposed new well locations: RMP. Actions that result in a change in SUMMARY: Under section 102(2)(C) of the needed separators and hydrators, the scope of resource uses, terms and National Environmental Policy Act storage tanks, field access and resource conditions, and decisions of the (NEPA) of 1969, as amended, the Bureau roads, a system of gathering and sales Pinedale RMP may require amendment of Land Management (BLM), Rawlins pipelines, compressor stations, and five of the RMP. If the BLM determines that Field Office, announces its intent to additional water wells. prepare an EIS on the potential impacts During the preparation of the EIS, a plan amendment is necessary, of a proposed coalbed methane natural proposed development of additional preparation of the JIDP EIS and the gas development project. In September exploratory wells within the project area analysis necessary for the RMP 2002, the BLM received from Dudley & on public lands may be approved amendment may occur simultaneously. subject to an environmental review by Appropriate analysis will accompany Associates, LLC (Dudley) a proposal to BLM and to a finding that such the decision to conduct an RMP drill and develop up to 1,240 wells (on development is consistent with the 1988 amendment. an estimated 785 well pad sites) and Pinedale Resource Management Plan Also, the Pinedale RMP is currently associated facilities. The proposed (RMP). Such a review will also ensure being revised, with completion project area encompasses approximately that the proposed development would scheduled for October 2004. Because the 137,000 acres of mixed Federal, State, not limit the consideration of a range of Jonah Infill Drilling Project EIS and the and private land. A 30 to 40 year reasonable alternatives for this proposed Pinedale RMP revision will be development and operational period is Jonah Infill Drilling Project EIS. developed on overlapping schedules, proposed. The project area is located The purpose of this project is to the information and analysis needed for approximately 20 air miles northeast of extract and recover natural gas from the these planning efforts will be jointly the city of Rawlins, Carbon County, Jonah Field by allowing the operators to prepared and used for both EISs, to the Wyoming. Based on the information provide clean burning fuel for greatest extent possible. Further developed during the course of this distribution to consumers. In addition, information of the status of this RMP analysis, the BLM may decide it is this project would meet the goals and revision may be obtained from the Web necessary to amend the 1990 Great objectives of the President’s National site at http://www.pinedalermp.com. Divide RMP. Energy Plan by diversifying domestic The BLM will announce public DATES: This notice initiates the public energy supplies, improving and meetings and comment periods through scoping process. The BLM can best use accelerating environmental protection, local news media and the Pinedale Field public input if comments and resources and strengthening America’s energy Office Web site, http://www.wy.blm.gov/ information are submitted within 60 security. pfo/info.htm, at least 15 days prior to days of the publication of this notice in BLM personnel, other agencies, and the event. The first in a series of the Federal Register. Public scoping individuals have preliminarily meetings is tentatively scheduled for meetings will be held in Rawlins, WY identified the following issues that will late March 2003, in Pinedale, Wyoming. and Hanna, WY. The BLM will notify be addressed in the EIS: Air quality; The BLM will also provide additional the public of meeting dates, times, and Federally-listed Threatened, opportunities for public participation locations 15 days in advance by a news Endangered, Candidate and Sensitive throughout the preparation of the EIS. release to the media, individual letter

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mailings, and posting on the BLM Web In September 2002, Dudley & grazing operations, protection of site listed below. Associates LLC (Dudley) submitted a potential cultural and paleontological ADDRESSES: Address questions and proposal to drill and develop potentially resources, threatened and endangered comments to the Bureau of Land up to 1,240 coalbed methane natural gas wildlife and plant species, and Management, Rawlins Field Office, wells on up to 785 locations. Associated socioeconomic impacts. David Simons, Team Leader, 1300 North project facilities would include roads, The project area is managed under the Third Street, PO Box 2407, Rawlins, well pads, gas and water collection Great Divide RMP (1990). This RMP is Wyoming 82301, telephone (307) 328– pipelines, compressor stations, water currently being revised under the title of 4200, or send them electronically to disposal systems, and a power supply Rawlins RMP, with completion [email protected]. Additionally, system. During the preparation of the scheduled for October 2004. Because the the scoping notice will be posted on the EIS, proposed development within the Seminoe Road Gas Development Project Wyoming BLM National Environmental project area on public lands may be EIS and the Rawlins RMP revision will Policy Act (NEPA) Web page at http:// approved subject to an environmental be developed on overlapping schedules, www.wy.blm.gov/nepa/nepadocs.htm. review by BLM and to a finding that the information and analysis needed for Your response is important and will be such development is consistent with the these planning efforts will be jointly considered in the environmental 1990 Great Divide Resource prepared and used for both EISs, to the analysis process. If you do respond, we Management Plan (RMP). Such a review greatest extent possible. Further will keep you informed of decisions will also ensure that the proposed information of the status of this RMP resulting from this analysis. Please note development would not limit the revision may be obtained from the Web that public comments and information consideration of a range of reasonable site at http://www.rawlinsrmp.com. alternatives for this proposed Seminoe submitted regarding this project Dated: February 12, 2003. including names, e-mail addresses, and Road Gas Development Project EIS. street addresses of the respondents will Any authorizations and actions Donald A. Simpson, be available for public review and proposed for approval in the EIS will be Acting State Director. disclosure at the above address during evaluated to determine if they conform [FR Doc. 03–6085 Filed 3–12–03; 8:45 am] regular business hours (7:45 a.m. to 4:30 to the decisions in the 1990 Great BILLING CODE 4310–22–P p.m.) Monday through Friday, except Divide RMP. Actions that result in a holidays. Individual respondents may change in the scope of resource uses, request confidentiality. If you wish to terms and conditions, and decisions of withhold your name, email address, or the approved Great Divide RMP may INTERNATIONAL TRADE street address from public review or require amendment of the RMP. If the COMMISSION from disclosure under the Freedom of BLM determines that a plan amendment Information Act, you must state this is necessary, preparation of the Seminoe [USITC SE–03–009] prominently at the beginning of your Road Coalbed Methane Natural Gas written comment. Such requests will be Development Project EIS and the Sunshine Act Meeting honored to the extent allowed by the analysis necessary for the amendment Agency Holding the Meeting: law. All submissions from organizations may occur simultaneously. Appropriate or businesses, and from individuals analysis will accompany the decision to International Trade Commission. identifying themselves as conduct an RMP amendment. Time and Date: representatives or officials of Development of coalbed methane March 24, 2003, at 2 p.m. organizations or businesses, will be natural gas development from the Place: made available for public inspection in Seminoe Road area will provide Room 101, 500 E Street, SW., their entirety. additional supplies of this clean- Washington, DC 20436. burning fuel to consumers. This project FOR FURTHER INFORMATION CONTACT: Telephone: meets the goals and objectives of the Bureau of Land Management, David (202) 205–2000. President’s National Energy Plan by Simons, Project Manager, 1300 North Status: diversifying domestic energy supplies, Third Street, PO Box 2407, Rawlins, Open to the public. improving and accelerating Wyoming 82301, phone (307) 328–4200, Matters to be Considered: environmental protection, and email address: strengthening the Nation’s energy [email protected]. 1. Agenda for future meetings: none. security. 2. Minutes. SUPPLEMENTARY INFORMATION: The The EIS will address cumulative 3. Ratification List. Seminoe Road Gas Development Project impacts and include consideration of is located in Townships 21, 22, 23, and the effects of the projects addressed in 4. Inv. Nos. 731–TA–1006, 1008, and 24 North, Ranges 84, 85 and 86 West, both the EA for the Seminoe Road 1009 (Final)(Urea Ammonium Nitrate Sixth Principal Meridian, Carbon Coalbed Methane Pilot Project (WY– Solutions from Belarus, Russia, and County, Wyoming. The project area is 030–EA00–288) and the EA for the Ukraine)—briefing and vote. (The located approximately 20 air miles Seminoe Road Natural Gas Gathering Commission is currently scheduled to northeast of Rawlins and approximately Pipeline Access Road and Compressor transmit its determination and 15 air miles northeast of Sinclair, Station Storage Yard Access Road Commissioners’ opinions to the Wyoming east of Carbon County Road Project (WY–030–EA2–229). Potential Secretary of Commerce on or before 351 (Seminoe Road). The project area issues to be addressed in the EIS April 3, 2003.) covers approximately 137,000 acres of include but are not limited to: Surface 5. Outstanding action jackets: none. Federal (49 percent) and private (49 and ground water resources, air quality, In accordance with Commission percent) surface with a small amount of wildlife populations and their habitats, policy, subject matter listed above, not State land (<2 percent). The BLM private and public land access concerns, disposed of at the scheduled meeting, Rawlins Field Office manages the road development and transportation, may be carried over to the agenda of the Federal surface lands and the Federal reclamation, noxious weed control, following meeting. mineral estate. reclamation, conflicts with livestock Issued: March 11, 2003.

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By order of the Commission. (3) Enhance the quality, utility, and November 7, 2002, (67 FR 67869), Marilyn R. Abbott, clarity of the information to be Chattem Chemicals, Inc., 3801 St. Elmo Secretary to the Commission. collected; and Avenue, Building 18, Chattanooga, [FR Doc. 03–6219 Filed 3–11–03; 2:42 pm] (4) Minimize the burden of the Tennessee 37409, made application by BILLING CODE 7020–02–P collection of information on those who renewal to the Drug Enforcement are to respond, including through the Administration (DEA) to be registered as use of appropriate automated, an importer of methamphetamine electronic, mechanical, or other (1105), a basic class of controlled DEPARTMENT OF JUSTICE technological collection techniques or substance list in Schedule II. other forms of information technology, The firm plans to import the listed Civil Division; Agency Information e.g., permitting electronic submission of controlled substance to bulk Collection Activities: Proposed responses. manufacture controlled substances. Collection; Comments Requested Overview of this information: No comments or objections have been (1) Type of information collection: received regarding this controlled ACTION: 60-Day emergency notice of This is a new collection. substance. DEA has considered the information collection under review: (2) The title of the form/collection: factors in Title 21, United States Code, Annuity Broker Qualification Annuity Broker Qualification section 823(a) and determined that the Declaration Form. Declaration Form. registration of Chattem Chemicals, Inc., The Department of Justice, Civil (3) The agency form number, if any, is consistent with the public interest Division has submitted the following and the applicable component of the and with United States obligations information collection request to the department sponsoring the collection: under international treaties, Office of Management and Budget Form Number: none. Civil Division, conventions, or protocols in effect on (OMB) for review and clearance in Torts Branch, Department of Justice. May 1, 1971, at this time. DEA has (4) Affected public who will be asked accordance with emergency review investigated Chattem Chemicals, Inc. on or required to respond, as well as a brief procedures of the Paperwork Reduction a regular basis to ensure the company’s abstract: Primary: Annuity Brokers. Act of 1995. OMB approval has been continued registration is consistent with Other: None. The information collection requested by March 14, 2003. The the public interest. The investigation requirement contained in this rule will proposed information collection is included inspection and testing of the be used to determine whether a broker published to obtain comments from the company’s physical security system, meets the minimum qualifications to be public and affected agencies. If granted, audit of the company’s records, listed as an annuity broker pursuant to the emergency approval is only valid for verification of the company’s section 11015(b) of Public Law 107–273. 180 days. Comments should be directed compliance with state and local laws, (5) An estimate of the total number of to OMB, Office of Information and and a review of the company’s respondents and the amount of time Regulation Affairs, Attention: background and history. estimated for an average respondent to Department of Justice Desk Officer (202) Therefore, pursuant to section 1008(a) respond/reply: It is estimated that 400 395–6466, Washington, DC 20503. of the Controlled Substances Import and respondents will complete the During the first 60 days of this same Export Act and in accordance with Title application in approximately 1 hour per review period, a regular review of this 21 Code of Federal Regulations, response. § 1301.34, the above firm is granted information collection is also being (6) An estimate of the total public undertaken. All comments and registration as an importer of the basic burden (in hours) associated with the class of controlled substance listed suggestions, or questions regarding collection: The estimated total public additional information, to include above. burden associated with this application Dated: February 28, 2003. obtaining a copy of the proposed is 400 hours. information collection instrument with If additional information is required Laura M. Nagel, instructions, should be directed to contact: Robert B. Briggs, Department Deputy Assistant Administrator, Office of Kenneth L. Zwick, Director, Office of Clearance Officer, Information Diversion Control, Drug Enforcement Administration. Management Programs, Civil Division, Management and Security Staff, Justice U.S. Department of Justice, Main Management Division, United States [FR Doc. 03–6066 Filed 3–12–03; 8:45 am] Building, Room 3140, 950 Pennsylvania Department of Justice, 601 D Street NW., BILLING CODE 4410–09–M Avenue NW., Washington, DC 20530, or Patrick Henry Building, Suite 1600, facsimile (202) 514–8071. NW., Washington, DC 20530. Request written comments and DEPARTMENT OF JUSTICE suggestions from the public and affected Dated: March 10, 2003. agencies concerning the proposed Robert B. Briggs, Drug Enforcement Administration collection of information. Your Department Clearance Officer, Department of Justice. Richard J. Clement, M.D.; Revocation comments should address one or more of Registration of the following four points: [FR Doc. 03–6080 Filed 3–12–03; 8:45 am] (1) Evaluate whether the proposed BILLING CODE 4410–12–M On November 19, 2002, the Deputy collection of information is necessary Assistant Administrator, Office of for the proper performance of the Diversion Control, Drug Enforcement functions of the agency, including DEPARTMENT OF JUSTICE Administration (DEA), issued an Order whether the information will have to Show Cause to Richard J. Clement, practical utility; Drug Enforcement Administration M.D. (Dr. Clement) of Lake Charles, (2) Evaluate the accuracy of the Importer of Controlled Substances; Louisiana, notifying him of an agencies estimate of the burden of the Notice of Registration opportunity to show cause as to why proposed collection of information, DEA should not revoke his DEA including the validity of the By notice dated October 25, 2002, and Certificate of Registration AC3534814 methodology and assumptions used; published in the Federal Register on under 21 U.S.C. 824(a), and deny any

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pending applications for renewal of that authority to handle controlled manufacture of bulk pharmaceutical registration pursuant to 21 U.S.C. 823(f). substances in the state in the state in controlled substances. As a basis for revocation, the Order to which he conducts business. See 21 No comments or objections have been Show Cause alleged that Dr. Clement is U.S.C. 802(21), 823(f) and 824(a)(3). received. DEA has considered the not currently authorized to practice This prerequisite has been consistently factors in Title 21, U.S. section 823(a) medicine or handle controlled upheld. See Ramona K. Morris, M.D., 67 and determined that the registration of substances in the State of Louisiana, the FR 68687 (2002); Dominick A. Ricci, Penick Corporation to manufacture the state in which he practices. The order M.D., 58 FR 51104 (1993); Bobby Watts, listed controlled substances is also notified Dr. Clement that should no M.D., 53 FR 11919 (1988). consistent with the public interest at request for a hearing be filed within 30 Here, it is clear that Dr. Clement’s this time. DEA has investigated Penick days, his hearing right would be deemed medical license has been indefinitely Corporation to ensure that the waived. suspended, and as a result, he is not company’s registration is consistent The Order to Show Cause was sent by licensed to handle controlled substances with the public interest. This certified mail to Dr. Clement at his in the State of Louisiana where he is investigation included inspection and registered location in Lake Charles, registered with DEA. Therefore, he is testing of the company’s physical Louisiana. DEA subsequently received a not entitled to a DEA registration in that security systems, verification of the signed receipt notification indicating state. company’s compliance with state and that the Order to Show Cause was local laws, and a review of the Accordingly, the Deputy received on behalf of Dr. Clement on company’s background and history. Administrator of the Drug Enforcement November 29, 2002. DEA has not Therefore, pursuant to 21 U.S.C. 823 Administration, pursuant to the received a request for hearing or any and 28 CFR 0.100 and 0.104, the Deputy authority vested in him by 21 U.S.C. 823 other reply from Dr. Clement or anyone Assistance Administrator, Office of and 824 and 28 CFR 0.100(b) and 0.104, purporting to represent him in this Diversion Control, hereby orders that hereby orders that DEA Certificate of matter. Therefore, the Deputy the application submitted by the above Registration AC3534814, issued to Administrator, finding that (1) 30 days firm is granted registration as a bulk Richard J. Clement, M.D. be, and it have passed since the receipt of the manufacturer of the basic classes of hereby is, revoked. The Deputy Order to Show Cause, and (2) no request controlled substances listed. Administrator further orders that any for a hearing having been received, Dated: February 28, 2003. concludes that Dr. Clement is deemed to pending applications for renewal or Laura M. Nagel, have waived his hearing right. After modification of such registration be, and considering material from the they hereby are, denied. This order is Deputy Assistant Administrator, Office of effective April 14, 2003. Diversion Control, Drug Enforcement investigative file in this matter, the Administration. Deputy Administrator now enters his Dated: February 27, 2003. [FR Doc. 03–6064 Filed 3–12–03; 8:45 am] final order without a hearing pursuant John B. Brown III, BILLING CODE 4410–09–M to 21 CFR 1301.43(d) and (e) and Deputy Administrator. 1301.46. [FR Doc. 03–6102 Filed 3–12–03; 8:45 am] The Deputy Administrator finds that BILLING CODE 4410–09–M DEPARTMENT OF JUSTICE Dr. Clement currently possesses DEA Certificate of Registration AC3534814 Drug Enforcement Administration and that registration remains valid until DEPARTMENT OF JUSTICE August 31, 2004. The Deputy Manufacturer of Controlled Administrator further finds that by Drug Enforcement Administration Substances; Notice of Registration Opinion and Ruling dated July 31, 2002, the Louisiana State Board of Medical Importer of Controlled Substances By notice dated June 14, 2002, and Examiners (Board) ordered the Notice of Registration published in the Federal Register on indefinite suspension of Dr. Clement’s June 28, 2002, (67 FR 43684), Sigma medical license. The suspension order By Notice dated July 9, 2002, and Aldrich Research Biochemicals, Inc., arose out of Dr. Clement’s refusal to published in the Federal Register on Attn: Richard Milius, 1–3 Strathmore undergo inpatient evaluation to August 6, 2002, (67 FR 50899), Penick Road, Natick, Massachusetts 01760, ascertain whether he suffered from ‘‘a Corporation, 158 Mount Olivet Avenue, made application by renewal to the psychiatric, neurologic (sic) or physical Newark, New Jersey 07114, made Drug Enforcement Administration condition which render[ed] him application by renewal to the Drug (DEA) to be registered as a bulk incapable of practicing medicine with Enforcement Administration (DEA) to manufacturer of the basic classes of reasonable skill and safety to patients.’’ be registered as a bulk manufacturer of controlled substances listed below: The investigative file contains no the basic classes of controlled evidence that the Board’s suspension substances listed below: Drug Schedule order has been stayed or that Dr. Drug Schedule Cathinone (1235) ...... I Clement’s medical license has been Methcathinone (1237) ...... I reinstated. Therefore, the Deputy Codeine (9050) ...... II Aminorex (1585) ...... I Administrator finds that Dr. Clement is Dihydrocodeine (9120) .... II Alpha-Ethyltryptamine (7249) ...... I Lysergic acid diethylamide (7315) I not currently authorized to practice Oxycodone (9143) ...... II Tetrahydrocannabinols (7370) ...... I medicine in the State of Louisiana. As Hydromorphone (9150) ... II 4-Bromo-2,5- I a result, it is reasonable to infer that he Hydrocodone (9193) ...... II dimethoxyamphetamine (7391). Morphine (9300) ...... II is also without authorization to handle 4-Bromo-2,5- I Thebaine (9333) ...... II controlled substances in that state. dimethoxyamphetamine (7392). Oxymorphone (9652) ...... II DEA does not have statutory authority 2,5-Dimethoxyamphetamine I under the Controlled Substances Act to (7396). issue or maintain a registration if the The firm plans to bulk manufacture 3,4-Methylenedioxyamphetamine I applicant or registrant is without state the listed controlled substances for the (7400).

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Drug Schedule Dated: February 28, 2003. and that registration remains valid until Laura M. Nagel, May 31, 2003. The Deputy N-Hydroxy-3,4- I Deputy Assistant Administrator, Office of Administration further finds that by methlenedioxyamphetamine Diversion Control, Drug Enforcement Order dated June 13, 2001, the (7402). Administration. Massachusetts Board of Registration in 3,4-Methylenedioxy-N- I [FR Doc. 03–6065 Filed 3–12–03; 8:45 am] ethylamphetamine (7404). Medicine (Board) ordered the BILLING CODE 4410–09–M 3,4- I suspension of Dr. Wooldridge’s medical Methylenedioxymethamphetami- license. The suspension order arose out ne (7405). of Dr. Wooldridge’s apparent failure to DEPARTMENT OF JUSTICE 1-[1-(2- I comply with terms of a probation Thienyl)cyclohexyl]piperidine Drug Enforcement Administration agreement that he entered into with the (7470). Board on March 3, 1999. Heroin (9200) ...... I Douglas W. Wooldridge, M.D.; The investigative file contains no Normorphine (9313) ...... I Revocation of Registration Amphetamine (1100) ...... II evidence that the Board’s suspension Methamphetamine (1105) ...... II On March 18, 2002, the Deputy order has been stayed or that Dr. Nabilone (7379) ...... II Assistant Administrator, Office of Wooldridge’s medical license has been Phenylcyclohexylamine (7460) ..... II Diversion Control, Drug Enforcement reinstated. Therefore, the Deputy Phencyclidine (7471) ...... II Administration (DEA), issued an Order Administrator finds that Dr. Wooldridge Cocaine (9041) ...... II to Show Cause to Douglas W. is not currently authorized to practice Codeine (9050) ...... II Wooldridge, M.D. (Dr. Wooldridge) of medicine in the Commonwealth of Diprenorphine (9058) ...... II Wellesley Hills, Massachusetts, Massachusetts. As a result, it is Benzoylecgonine (9180) ...... II notifying him of an opportunity to show reasonable to infer that he is also Levomethorphan (9210) ...... II cause as to why DEA should not revoke without authorization to handle Levorphanol (9220) ...... II his DEA Certificate of Registration, controlled substances in Massachusetts. Meperidine (9230) ...... II AW1232088 under 21 U.S.C. 824(a), and DEA does not have statutory authority Metazocine (9240) ...... II deny any pending applications for Methadone (9250) ...... II under the Controlled Substances Act to renewal of that registration pursuant to issue or maintain a registration if the Morphine (9300) ...... II 21 U.S.C. 823(f). As a basis for applicant or registrant is without state Thebaine (9333) ...... II revocation, the Order to Show Cause authority to handle controlled Carfentanil (9743) ...... II alleged that Dr. Wooldridge is not Levo-alphacetylmethadol (LAAM) II currently authorized to practice substances in the state in which he (9648). medicine or handle controlled conducts business. See 21 U.S.C. Fentanyl (9801) ...... II substances in the Commonwealth of 802(21), 823(f) and 824(a)(3). This Massachusetts, the state in which he prerequisite has been consistently The firm plans to manufacture the practices. The order also notified Dr. upheld. See Muttaiya Darmarajeh, M.D., listed controlled substances for Wooldridge that should no request for a 66 FR 52936 (2001); Dominick A. Ricci, laboratory reference standards and hearing be filed within 30 days, his M.D., 58 FR 51104 (1993); Bobby Watts, neurochemicals. hearing right would be deemed waived. M.D., 53 FR 11919 (1988). DEA has considered the factors in The Order to Show Cause was sent by Here, it is clear that Dr. Wooldridge’s Title 21, United States Code, Section certified mail to Dr. Wooldridge at his medical license has been suspended, 823(a) and determined that the registered location in Wellesley Hills, and as a result, he is not licensed to registration of Sigma Aldrich Research Massachusetts. On June 6, 2002, DEA handle controlled substances in the Biochemicals, Inc. to manufacture the received a signed receipt notification Commonwealth of Massachusetts where listed controlled substances is indicating that the Order to Show Cause he is registered with DEA. Therefore, he consistent with the public interest at was apparently forwarded from Dr. is not entitled to a DEA registration in this time. DEA has investigated Sigma Wooldridge’s registered location to a that state. second location where it was received Aldrich Research Biochemicals, Inc. on Accordingly, the Deputy a regular basis to ensure that the by a John Wooldridge on March 27, 2002. DEA has not received a request for Administrator of the Drug Enforcement company’s continued registration is hearing or any other reply from Dr. administration, pursuant to the consistent with the public interest. Wooldridge or anyone purporting to authority vested in him by 21 U.S.C. 823 These investigations have included represent him in this matter. Therefore, and 824 and 28 CFR 0.100(b) and 0.104, inspection and testing of the company’s the Deputy Administrator, finding that hereby orders that DEA Certificate of physical security systems, audits of the (1) 30 days have passed since the receipt Registration AW1232088, issued to company’s records, verification of the of the Order to Show Cause, and (2) no Douglas W. Wooldridge, M.D. be, and it company’s compliance with state and request for a hearing having been hereby is, revoked. The Deputy local laws, and a review of the received, concludes that Dr. Wooldridge Administrator further orders that any company’s background and history. is deemed to have waived his hearing pending applications for renewal of Therefore, pursuant to 21 U.S.C. 823 right. After considering material from such registration be, and they hereby and 28 CFR 0.100 and 0.104, the Deputy the investigative file in this matter, the are, denied. This order is effective April Assistant Administrator, Office of Deputy Administrator now enters his 14, 2003. Diversion Control, hereby orders that final order without a hearing pursuant Dated: February 27, 2003. the application submitted by the above to 21 CFR 1301.43(d) and (e) and firm for registration as a bulk 1301.46. John B. Brown III, manufacturer of the basic classes of The Deputy Administrator finds that Deputy Administrator. controlled substances listed above is Dr. Wooldridge currently possesses DEA [FR Doc. 03–6101 Filed 3–12–03; 8:45 am] granted. Certificate of Registration AW1232088 BILLING CODE 4410–09–M

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DEPARTMENT OF LABOR Total Burden Hours: 3. of this publication in the Federal Total Annualized Capital/Startup Register. Office of the Secretary Costs: $0. The OMB is particularly interested in Total Annual Costs (operating/ comments which: Submission for OMB Review; maintaining systems or purchasing • Evaluate whether the proposed Comment Request services): $332. collection of information is necessary Description: Sponsors and other for the proper performance of the March 6, 2003. parties-in-interest to Employee The Department of Labor (DOL) has functions of the agency, including Retirement Income Security Act whether the information will have submitted the following public (ERISA)—covered pension plans that information collection reqest (ICR) to practical utility; cannot segregate employee • Evaluate the accuracy of the the Office of Management and Budget contributions from the employer’s agency’s estimate of the burden of the (OMB) for review and approval in general assets in the time required proposed collection of information, accordance with the Paperwork under ERISA are provided with an including the validity of the Reduction Act of 1995 (Pub. L. 104–13, extension procedure. 29 CFR 2510.3– methodology and assumptions used; 44 U.S.C. Chapter 35). A copy of this 102 provides guidance for fiduciaries, • Enhance the quality, utility, and ICR, with applicable supporting participants, and beneficiaries of clarity of the information to be documentation, may be obtained by employee benefit plans on the collected; and calling the Department of Labor. To requirements for transmission of • Minimize the burden of the obtain documentation contact Darrin employee contributions withheld from collection of information on those who King at (202) 693–4129 or E-Mail King- wages to the pension plan. In addition, are to respond, including through the [email protected]. for these employers who may have use of appropriate automated, Comments should be sent to Office of difficulty meeting regulation deadlines electronic, mechanical, or other Information and Regulatory Affairs, for participant contribution technological collection techniques or Attn: OMB Desk Officer for EBSA, transmissions, the extension provision other forms of information technology; Office of Management and Budget, of the regulation provides an alternate e.g., permitting electronic submission of Room 10235, Washington, DC 20503 means of employer compliance with the responses. ((202) 395–7316), within 30 days from regulation while providing participants, Agency: Employment and Training the date of this publication in the beneficiaries, and the Department with Administration (ETA). Federal Register. sufficient information to protect their Type of Review: Extension of a The OMB is particularly interested in rights under ERISA. Specifically, the currently approved collection. comments which: ICR includes notification, bonding, and Title: Distribution of Characteristics of • Evaluate whether the proposed certification requirements that must be the Insured Unemployed. collection of information is necessary completed by the employer electing to OMB Number: 1205–0009. for the proper performance of the use the extension provision. Affected Public: State, Local, or Tribal functions of the agency, including Government. whether the information will have Ira L. Mills, Type of Response: Reporting. practical utility; Departmental Clearance Officer. Frequency: Monthly. • Evaluate the accuracy of the [FR Doc. 03–6046 Filed 3–12–03; 8:45 am] Number of Respondents: 53. agency’s estimate of the burden of the BILLING CODE 4510–29–M Annual Responses: 636. proposed collection of information, Average Time Per Response: 20 including the validity of the minutes. methodology and assumptions used; DEPARTMENT OF LABOR Total Annual Burden Hours: 212. • Enhance the quality, utility, and Total Annualized Capital/Startup clarity of the information to be Office of the Secretary Costs: $0. collected; and minimize the burden of Total Annual Costs (operating/ the collection of information on those Submission for OMB Review; maintaining systems or purchasing who are to respond, including through Comment Request services): $0. the use of appropriate automated, March 3, 2003. Description: The ETA–203 report is electronic, mechanical, or other The Department of Labor (DOL) has the only source of current, consistent technological collection techniques or submitted the following public democraphic information on the other forms of information technology, information collection request (ICR) to Unemployed Insurance (UI) claim e.g., permitting electronic submission of the Office of Management and Budget population. These characteristics responses. (OMB) for review and approval in identify important claimant cohorts for Agency: Employee Benefits Security accordance with the Paperwork legislation, economic and social Administration (EBSA). Reduction Act of 1995 (Pub. L. 104–13, planning purposes, and the evaluation Type of Review: Extension of a 44 U.S.C. Chapter 35). A copy of this of the UI program on the Federal and currently approved collection. State levels. Title: Definition of Plans Assets— ICR, with applicable supporting Participant Contributions. documentation, may be obtained by Ira L. Mills, OMB Number: 1210–0100. calling the Department of Labor. To Departmental Clearance Officer. Affected Public: Business or other for- obtain documentation contact Darrin [FR Doc. 03–6047 Filed 3–12–03; 8:45 am] King on (202) 693–4129 or E-Mail: profit and not-for-profit institutions. BILLING CODE 4510–30–M Frequency: On occasion. [email protected]. Type of Response: Recordkeeping, Comments should be sent to Office of Information and Regulatory Affairs, reporting, and third party disclosure. MISSISSIPPI RIVER COMMISSION Number of Respondents: 1. Attn: OMB Desk Officer for ETA, Office Number of Annual Responses: 251. of Management and Budget, Room Sunshine Act Meetings Estimated Time Per Respondent: 3 10235, Washington, DC 20503 ((202) hours. 395–7316), within 30 days from the date AGENCY: Mississippi River Commission.

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TIME AND DATE: 9 a.m., April 7, 2003. Engineers and Commission programs Type of Request: Intent to seek PLACE: On board MISSISSIPPI V at City and projects on the Mississippi River approval to establish an information Front, Cape Girardeau, MO. and its tributaries; (2) District collection. Commander’s overview of current STATUS: Open to the public. Abstract project issues within the New Orleans MATTERS TO BE CONSIDERED: (1) District; and (3) Presentations by local The Integrative Graduate Education Summary report by President of the organizations and members of the and Research Traineeship (IGERT) Commission on national and regional public giving view or comments on any program was initiated in 1997 and now issues affecting the U.S. Army Corps of issue affecting the programs or of the comprises approximately 100 award Engineers and Commission programs Commission and the Corps of Engineers. sites. The IGERT program has been and projects on the Mississippi River developed to meet the challenges of CONTACT PERSON FOR MORE INFORMATION: and its tributaries; (2) District educating U.S. Ph.D. scientists, Mr. Stephen Gambrell, telephone 601– Commander’s overview of current engineers, and educators with the 634–5766. project issues within the Memphis interdisciplinary backgrounds, deep District; and (3) Presentations by local Luz D. Ortiz, knowledge in chosen disciplines, and organizations and members of the Army Federal Register Liaison Officer. technical, professional, and personal public giving views or comments on any [FR Doc. 03–6165 Filed 3–11–03; 11:43 am] skills to become in their own careers the issue affecting the programs or projects BILLING CODE 3710–6X–M leaders and creative agents for change. of the Commission and the Corps of The program is intended to catalyze a Engineers. cultural change in graduate education, TIME AND DATE: 9 a.m., April 8, 2003. for students, faculty, and institutions, by PLACE: On board MISSISSIPPI V at Mud NATIONAL SCIENCE FOUNDATION establishing innovative new models for Island, Memphis, TN. graduate education and training in a Notice of Intent to Seek Approval to fertile environment for collaborative STATUS: Open to the public. Establish an Information Collection research that transcends traditional MATTERS TO BE CONSIDERED: (1) disciplinary boundaries. It is also Summary report by President of the AGENCY: National Science Foundation. intended to facilitate greater diversity in Commission on national and regional ACTION: Notice and request for student participation and preparation, issues affecting the U.S. Army Corps of comments. and to contribute to the development of Engineers and Commission programs a diverse, globally-engaged science and and projects on the Mississippi River SUMMARY: The National Science engineering workforce. As part of this and its tributaries; (2) District Foundation (NSF) is announcing plans endeavor, IGERT awardees are expected Commander’s overview of current to request clearance of this collection. In to integrate instruction in ethics and the project issues within the Memphis accordance with the requirement of responsible conduct to research into District; and (3) Presentations by local section 3506(c)(2)(A) of the Paperwork their training programs. However, no organizations and members of the Reduction Act of 1995 (Pub. L. 104–13), mechanism is currently in place to public giving views or comments on any we are providing opportunity for public determine (1) Whether such instruction issue affecting the programs or projects comment on this action. After obtaining occurs once the award is made, and (2) of the Commission and the Corps of and considering public comment, NSF whether such instruction meets its Engineers. will prepare the submission requesting goals. Thus, the NSF would like to TIME AND DATE: 9 a.m. April 9, 2003. that OMB approve clearance of this survey IGERT recipients to answer the collection for no longer than three years. PLACE: On board MISSISSIPPI V at City above questions. Front, Greenville, MS DATES: Written comments on this notice must be received by May 12, 2003 to be Proposed Project STATUS: Open to the public. assured of consideration. Comments IGERT awardees will be invited, via MATTERS TO BE CONSIDERED: Summary received after that date will be email correspondence, to access a web- report by President of the Commission considered to the extent practicable. based survey document by a given date. on national and regional issues affecting FOR FURTHER INFORMATION OR COMMENTS: This survey encompasses 22 questions, the U.S. Army Corps of Engineers and Contact Teresa R. Pierce, Reports some with multiple parts, and is Commission programs and projects on designed to assess the presence and the Mississippi River and its tributaries; Clearance Officer, National Science Foundation, 4201 Wilson Boulevard, relative strengths and weaknesses of any (2) District Commander’s overview of ethics training programs offered as part current project issues within the Suite 295, Arlington, Virginia 22230; telephone (703) 292–7555; or sent email of the IGERT program at the awardee’s Vicksburg District and; (3) presentations institution. by local organizations and members of to [email protected]. Individuals who use a telecommunications device for the Use of the Information: The results of the public giving views or comments on the survey will be used to update any issue affecting the programs or deaf (TDD) may call the Federal Information Relay Service (FIRS) at 1– Program Announcements and annual projects of the Commission and the report requirements to reflect NSF’s Corps of Engineers. 800–877–8339 between 8 a.m. to 8 p.m., Eastern time, Monday through Friday. desire to promote the development of TIME AND DATE: 9 a.m. April 11, 2003. You also may obtain a copy of the data ethically trained scientists. Any additional reports developed with the PLACE: On Board MISSISSIPPI V at New collection instrument and instructions Orleans District Dock, Foot of Prytania from Ms. Pierce. survey results will be distributed to all Street, New Orleans, LA. IGERT awardees. SUPPLEMENTARY INFORMATION: Estimate of Burden: 60 minutes per STATUS: Open to the Public. Title of Collection: Survey of IGERT respondent, for 100 respondents, MATTERS TO BE CONSIDERED: (1) recipients. totaling 100 hours. Summary report by President of the OMB Number: 3145–NEW. Respondents: Individuals. Commission on national and regional Expiration Date of Approval: Not Estimated Number of Responses per issues affecting the U.S. Army Corps of applicable. Report: 1.

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Comments: Comments are invited on disclosure to such consumer of such investment companies, and 7,800 (a) Whether the proposed collection of financial institution’s policies and registered investment advisers) that information is necessary for the proper practices with respect to disclosing must prepare or revise the annual and performance of the functions of the nonpublic personal information to initial privacy notices they provide to Agency, including whether the affiliates and nonaffiliated third parties their customers. To prepare or revise information shall have practical utility; (‘‘privacy notice’’). Title V of the Act their privacy notices, each of the (b) the accuracy of the Agency’s also provides that, unless an exception approximately 10,700 covered entities estimate of the burden of the proposed applies, a financial institution may not that is a broker-dealer or investment collection of information; (c) ways to disclose nonpublic personal information company requires an estimated 40 hours enhance the quality, utility, and clarity of a consumer to a nonaffiliated third at a cost of $5,248 (32 hours of of the information on respondents, party unless the financial institution professional time at $160 per hour plus including through the use of automated clearly and conspicuously discloses to 8 hours of clerical or administrative collection techniques or other forms of the consumer that such information may time at $16 per hour) and each of the information technology; and (d) ways to be disclosed to such third party; the approximately 7,800 covered entities minimize the burden of the collection of consumer is given the opportunity, that is a registered investment adviser information on those who are to before the time that such information is requires an estimated 5 hours at a cost respond, including through the use of initially disclosed, to direct that such of $656 (4 hours of professional time at appropriate automated, electronic, information not be disclosed to such $160 per hour plus 1 hour of clerical or mechanical, or other technological third party; and the consumer is given administrative time at $16 per hour). collection techniques or other forms of an explanation of how the consumer can Thus, the total compliance burden per information technology. exercise that nondisclosure option (‘‘opt year is 740,000 hours (40 hours for Dated: March 7, 2003. out notice’’). 10,700 broker-dealers and investment The privacy notices required by the companies, and 5 hours for 7,800 Suzanne H. Plimpton, Act are mandatory. The opt out notices registered investment advisers (40 × Reports Clearance Officer, National Science are not mandatory for financial 10,700 = 428,000, 5 × 7,800 = 39,000, Foundation. institutions that do not share nonpublic and 428,000 + 39,000 = 467,000), and [FR Doc. 03–5959 Filed 3–12–03; 8:45 am] personal information with nonaffiliated $57,401,600 ($5,248 × 10,700 = BILLING CODE 7555–01–M third parties except as permitted under $56,153,600, $160 × 7,800 = $1,248,000, an exception to the statute’s opt out and $56,153,600 + $1,248,000 = provisions. Regulation S–P implements $57,401,600). SECURITIES AND EXCHANGE the statute’s requirements with respect It is not anticipated that covered COMMISSION to broker-dealers, investment entities will need to incur any capital or companies, and registered investment start-up cost to comply with Regulation Proposed Collection; Comment advisers (‘‘covered entities’’). The Act S–P. However, covered entities Request and Regulation S–P also contain generally will include initial and annual Upon written request, copies available from: consumer reporting requirements. In privacy notices to customers with Securities and Exchange Commission, order for consumers to opt out, they disclosure documents or account Office of Filings and Information Services, must respond to opt out notices. At any statements that they currently receive. Washington, DC 20549. time during their continued These statements typically are Extension: relationship, consumers have the right assembled and sent by organizations Regulation S–P; SEC File No. 270–480; to change or update their opt out status. that specialize in mailing and OMB Control No. 3235–0537. Most covered entities do not share distribution. The additional material Notice is hereby given that pursuant nonpublic personal information with might result in an increase in total to the Paperwork Reduction Act of 1995 nonaffiliated third parties and therefore annual distribution costs of (44 U.S.C. 3501 et seq.), the Securities are not required to provide opt out approximately $2.6 million for all and Exchange Commission notices to consumers under Regulation covered entities. This estimate is based (‘‘Commission’’) is soliciting comments S–P. Therefore, few consumers are on an average additional cost per on the collection of information required to respond to opt out notices mailing of $0.02 for 130.7 million summarized below. The Commission under the rule. investor accounts. The number of plans to submit this existing collection Compliance with Regulation S–P is investor accounts assumes there are 53 of information to the Office of necessary for covered entities to achieve million brokerage accounts, 77.3 million Management and Budget for extension compliance with the consumer financial individual investment company and approval. privacy notice requirements of title V of shareholders, and 400,000 customers of • the G–L–B Act. The required consumer investment advisers. Regulation S–P—Privacy of Consumer notices are not submitted to the Written comments are invited on: (a) Financial Information Commission. Because the notices do not Whether the proposed collection of On June 22, 2000, effective November involve a collection of information by information is necessary for the proper 13, 2000, the Commission adopted the Commission, Regulation S–P does performance of the functions of the Regulation S–P under the Securities not involve the collection of agency, including whether the Exchange Act of 1934 (‘‘Exchange Act’’) confidential information. Regulation S– information shall have practical utility; to implement title V of the Gramm- P does not have a record retention (b) the accuracy of the agency’s Leach-Bliley Act (‘‘G–L–B Act’’ or requirement per se, although the notices estimates of the burden of the proposed ‘‘Act’’). Among other things, title V of to consumers it requires are subject to collection of information; (c) ways to the G–L–B Act requires that at the time the recordkeeping requirements of rules enhance the quality, utility, and clarity of establishing a customer relationship 17a–3 and 17a–4. of the information to be collected; and with a consumer and not less than Currently, there are approximately (d) ways to minimize the burden of the annually during the continuation of 18,500 covered entities (approximately collection of information on such relationship, a financial institution 5,600 broker-dealers that conduct respondents, including through the use shall provide a clear and conspicuous business with the general public, 5,100 of automated collection techniques or

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other forms of information technology. I. Self-Regulatory Organization’s 2. Statutory Basis Consideration will be given to Statement of the Terms of Substance of The Exchange believes the proposed comments and suggestions submitted in the Proposed Rule Change rule change is consistent with section writing within 60 days of this 6(b) of the Act,8 in general, and furthers publication. The Amex proposes to extend until the objectives of section 6(b)(5),9 in Please direct your written comments January 31, 2003, the pilot program providing for the implementation of particular, because it should prevent to Kenneth A. Fogash, Acting Associate fraudulent and manipulative acts and Executive Director/CIO, Office of ‘‘interim linkages’’ with the other option exchanges. practices, promote just and equitable Information Technology, Securities and principles of trade, remove Exchange Commission, 450 5th Street, II. Self-Regulatory Organization’s impediments to and perfect the NW., Washington, DC 20549. Statement of the Purpose of, and mechanisms of a free and open market Dated: March 6, 2003. Statutory Basis for, the Proposed Rule and a national market system, and, in Margaret H. McFarland, Change general, protect investors and the public Deputy Secretary. In its filing with the Commission, the interest. [FR Doc. 03–5992 Filed 3–12–03; 8:45 am] Amex included statements concerning B. Self-Regulatory Organization’s BILLING CODE 8010–01–P the purpose of, and basis for, the Statement on Burden on Competition proposed rule change and discussed any comments it received on the proposed The Amex does not believe that the SECURITIES AND EXCHANGE rule change. The text of these statements proposed rule change will impose any COMMISSION may be examined at the places specified burden on competition. in item IV below. The Amex has C. Self-Regulatory Organization’s [Release No. 34–47450; File No. SR–Amex– prepared summaries, set forth in Statement on Comments on the 2003–02] sections A, B, and C below, of the most Proposed Rule Change Received From significant aspects of such statements. Members, Participants or Others Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness A. Self-Regulatory Organization’s No written comments were solicited of a Proposed Rule Change and Statement of the Purpose of, and or received with respect to the proposed Amendment No. 1 Thereto by the Statutory Basis for, the Proposed Rule rule change. Change American Stock Exchange LLC III. Date of Effectiveness of the Relating to an Extension of the Interim 1. Purpose Proposed Rule Change and Timing for Intermarket Linkage Program Commission Action The purpose of this proposed rule March 5, 2003. change is to request an extension of the Because the foregoing proposed rule Pursuant to section 19(b)(1) of the ‘‘interim’’ intermarket options linkage.6 change: (1) Does not significantly affect Securities Exchange Act of 1934 Currently, the Exchange is operating the the protection of investors or the public (‘‘Act’’),1 and rule 19b–4 thereunder,2 interim linkage on a pilot basis pursuant interest; (2) does not impose any notice is hereby given that on January to Amex rule 940. The interim linkage significant burden on competition; (3) 27, 2003, the American Stock Exchange utilizes the Exchange’s existing systems does not become operative for 30 days LLC (‘‘Amex’’ or ‘‘Exchange’’) filed with to facilitate the sending and receiving of from the date of filing, or such shorter the Securities and Exchange order flow between Amex specialists date as the Commission may designate, Commission the proposed rule change and their counterparts on the other if consistent with the protection of as described in items I and II below, option exchanges as an interim step investors and the public interest; and (4) which items have been prepared by the towards development of a permanent the Exchange provided the Commission Amex. The Exchange submitted linkage in the options market.7 The with notice of its intent to file the Amendment No. 1 to the proposed rule Exchange now proposes that the interim proposed rule change at least five days change on March 4, 2003.3 The linkage remain in effect on a pilot basis prior to the filing date, the proposed Exchange filed the proposed rule change until January 31, 2003. rule change has become effective pursuant to section 19(b)(3)(A) of the For the reasons stated above, the pursuant to section 19(b)(3)(A) of the Act,4 and rule 19b–4(f)(6) thereunder,5 10 11 Amex requests an extension of the pilot Act and rule 19b–4(f)(6) thereunder. which renders the proposal effective program until January 31, 2003. A proposed rule change filed under upon filing with the Commission. The rule 19b–4(f)(6) 12 does not become Commission is publishing this notice to 6 On January 31, 2002, the Commission extended operative prior to 30 days after the date solicit comments on the proposed rule the Exchange’s Interim Linkage until December 31, of filing or such shorter time as the change, as amended, from interested 2002. See Securities Exchange Act Release No. Commission may designate if such persons. 45373 (January 31, 2002), 67 FR 5860 (February 7, action is consistent with the protection 2002) (File No. SR–Amex–2002–03). The Commission previously approved the Interim of investors and the public interest. The 1 15 U.S.C. 78s(b)(1). Linkage, on a pilot basis, for all options exchanges. Amex has requested, in order to permit 2 17 CFR 240.19b–4. See Securities Exchange Act Release Nos. 43904 the uninterrupted operation of the 3 See letter to Jennifer Lewis, Division of Market (January 30, 2001), 66 FR 9112 (February 6, 2001) interim linkage, that the Commission Regulation, Commission, from Jeffrey P. Burns, (File Nos. SR–ISE–00–15 and SR–CBOE–00–58); Assistant General Counsel, Amex, dated March 4, 43986 (February 20, 2001), 66 FR 12578 (February accelerate the implementation of the 2003 (‘‘Amendment No. 1’’). In Amendment No. 1, 27, 2001) (File No. SR–PCX–2001–10); 44271 (May proposed rule change so that it may take Amex proposes that the extension of its interim 7, 2001), 66 FR 26887 (May 15, 2001) (File No. SR– effect prior to the 30 days specified in linkage expire on January 31, 2003. Amex–2001–20); and 44311 (May 16, 2001), 66 FR 4 15 U.S.C. 78s(b)(3)(A). 28768 (May 24, 2001) (File No. SR–Phlx–2001–52). 8 15 U.S.C. 78f(b). 5 17 CFR 240.19b–4(f)(6). The Amex requests that 7 The Commission approved the Plan for the 9 the Commission waive the 30-day operative delay. Purpose of Creating and Operating an Intermarket 15 U.S.C. 78f(b)(5). The Amex provided the Commission with notice of Options Linkage in July 2000. See Securities 10 15 U.S.C. 78s(b)(3)(A). its intention to file this proposal on January 22, Exchange Act Release No. 43086 (July 28, 2000), 65 11 17 CFR 240.19b–4(f)(6). 2003. FR 48023 (August 4, 2000). 12 17 CFR 240.19b–4(f)(6).

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rule 19b–4(f)(6)(iii).13 The Commission SECURITIES AND EXCHANGE business day preceding the expiration believes waiving the 30-day operative COMMISSION date thereof, if such rights are exercisable in the New York City delay is consistent with the protection [Release No. 34–47446; File No. SR–Amex– of investors and the public interest. 2002–105] metropolitan area, and at such time in Acceleration of the operative date will advance of the expiration date as may be permit operation of the interim options Self-Regulatory Organizations; Notice announced by the Exchange, if such linkage to continue uninterrupted.14 of Filing of Proposed Rule Change and rights are exercisable outside such area; and At any time within 60 days of the Amendment No. 1 Thereto by the American Stock Exchange LLC To (2) Dealings in an issue of warrants filing of the proposed rule change, the Amend Amex Rule 17 to Provide for shall cease, in the case of book-entry Commission may summarily abrogate ‘‘Cash’’ In Addition to ‘‘Next Day’’ warrants, at the close of business on such rule change if it appears to the Settlement of Transactions in Rights their expiration date, and for all other Commission that such action is and Warrants During the Trading Days warrants at the close of business on the necessary or appropriate in the public Prior to Expiration last business date preceding their interest, for the protection of investors, expiration date. or otherwise in furtherance of the March 5, 2003. (b) During the three business days purposes of the Act. Pursuant to section 19(b)(1) of the preceding the final day for dealings Securities Exchange Act of 1934 therein on the Exchange, all transactions IV. Solicitation of Comments (‘‘Act’’),1 and rule 19b–4 thereunder,2 in an issue of rights shall be made only notice is hereby given that on December Interested persons are invited to ‘‘next day[.]’’ or for ‘‘cash’’. On the final 12, 2002, the American Stock Exchange submit written data, views and day for dealings therein on the LLC (‘‘Amex’’ or ‘‘Exchange’’) filed with Exchange, all transactions in an issue of arguments concerning the foregoing, the Securities and Exchange rights shall be made only for ‘‘cash.’’ including whether the proposed rule Commission (‘‘Commission’’) the (c) During the three final business change, as amended, is consistent with proposed rule change as described in days for trading in an issue of warrants, the Act. Persons making written items I, II and III below, which items dealings on the Exchange shall be made submissions should file six copies have been prepared by the Exchange. only for ‘‘cash.’’ During the three thereof with the Secretary, Securities The Amex filed an amendment to the preceding business days dealings on the and Exchange Commission, 450 Fifth proposed rule change on January 23, Exchange shall be made only ‘‘next Street, NW., Washington, DC 20549– 2003.3 The Commission is publishing day[.]’’ or for ‘‘cash’. 0609. Copies of the submission, all this notice to solicit comments on the * * * Commentary subsequent amendments, all written proposed rule change and Amendment See rule 179 for treatment of orders on statements with respect to the proposed No. 1 from interested persons. a specialist’s book during the final days rule change that are filed with the I. Self-Regulatory Organization’s for dealings in rights or warrants. Commission, and all written Statement of the Terms of Substance of * * * * * communications relating to the the Proposed Rule Change proposed rule change between the II. Self-Regulatory Organization’s The Amex proposes to amend Amex Commission and any person, other than Statement of the Purpose of, and rule 17 to provide for ‘‘cash’’ in addition those that may be withheld from the Statutory Basis for, the Proposed Rule to ‘‘next day’’ settlement of transactions Change public in accordance with the in rights and warrants during the provisions of 5 U.S.C. 552, will be trading days prior to expiration. The In its filing with the Commission, the available for inspection and copying in text of the proposed rule change is Exchange included statements the Commission’s Public Reference below. Text in brackets indicates concerning the purpose of and basis for Room. Copies of such filing will also be material to be deleted, and text in italics the proposed rule change, as amended, available for inspection and copying at indicates material to be added. and discussed any comments it received on the proposed rule change. The text the principal office of the Amex. All * * * * * submissions should refer to File of these statements may be examined at Number SR-Amex-2003–02 and should Transactions in Rights and Warrants the places specified in item IV below. be submitted by April 3, 2003. Rule 17. (a) Unless otherwise directed The Exchange has prepared summaries, by the Exchange, dealings on the set forth in sections A, B, and C below, For the Commission, by the Division of Exchange in an issue of rights or of the most significant aspects of such Market Regulation, pursuant to delegated warrants shall cease in accordance with statements. authority.15 the following procedure: Margaret H. McFarland, A. Self-Regulatory Organization’s (1) Dealings in an issue of rights shall Statement of the Purpose of, and Deputy Secretary. cease at the close of business on the Statutory Basis for, the Proposed Rule [FR Doc. 03–5993 Filed 3–12–03; 8:45 am] Change 1 BILLING CODE 8010–01–P 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1. Purpose 3 See letter from William Floyd-Jones, Jr., Assistant General Counsel, Amex, to Nancy J. Amex rule 17(b) currently provides Sanow, Assistant Director, Division of Market that transactions in rights during the Regulation, Commission, dated January 21, 2003, three trading days preceding the last replacing Form 19b–4 in its entirety (‘‘Amendment 13 trading session must be settled on a 17 CFR 240.19b–4(f)(6)(iii). No. 1’’). In Amendment No. 1, the Amex made ‘‘next day’’ basis. Amex rule 17(c) 14 For purposes of accelerating the corrections to rule text in Amex rule 17(b) to allow implementation of the proposed rule change only, for ‘‘cash’’ settlement as well as ‘‘next day’’ currently provides that transactions in settlement for all transactions in an issue of rights the Commission notes that it has considered the warrants during the three trading days during the three business days preceding the final preceding the last three trading sessions proposed rule’s impact on efficiency, competition, day for dealings on the Exchange and made and capital formation. 15 U.S.C. 78c(f). corresponding changes and corrections to its (i.e., the fourth, fifth and sixth trading 15 17 CFR 200.30–3(a)(12). discussion in the rule filing. sessions prior to expiration) must only

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be effected on a ‘‘next day’’ basis. The arguments concerning the foregoing, I. Self-Regulatory Organization’s Exchange believes that there is no including whether the proposed rule Statement of the Terms of Substance of reason why trades should not be settled change, as amended, is consistent with the Proposed Rule Change for ‘‘cash’’ at any time during the final the Act. Persons making written The Amex proposes to extend until six days prior to expiration, and is submissions should file six copies March 31, 2003 the suspension of proposing to amend Amex rule 17 to thereof with the Secretary, Securities Exchange transaction charges for allow ‘‘cash’’ settlement during all of and Exchange Commission, 450 Fifth specialist, Registered Trader and broker- the final six days of trading in any right Street, NW., Washington, DC 20549– dealer orders for the iShares Lehman 1– or warrant on the Exchange. 0609. Copies of the submission, all 3 year Treasury Bond Fund; iShares 2. Statutory Basis subsequent amendments, all written Lehman 7–10 year Treasury Bond Fund; statements with respect to the proposed The Exchange believes that the Treasury 10 FITR ETF; Treasury 5 FITR rule change, as amended, that are filed ETF; Treasury 2 FITR ETF; and Treasury proposed rule change, as amended, is with the Commission, and all written consistent with section 6(b) of the Act 4 1 FITR ETF. In addition, the Exchange communications relating to the proposes to suspend until March 31, in general, and furthers the objectives of proposed rule change, as amended, section 6(b)(5) of the Act 5 in particular, 2003 customer transaction charges for between the Commission and any the iShares S&P 100 Index Fund. because it is designed to prevent person, other than those that may be fraudulent and manipulative acts and Proposed new language is italicized; withheld from the public in accordance proposed deletions are in [brackets]. practices, to promote just and equitable with the provisions of 5 U.S.C. 552, will principles of trade, to foster cooperation be available for inspection and copying * * * * * and coordination with persons engaged in the Commission’s Public Reference AMEX EQUITY FEE SCHEDULE in regulating, clearing, settling, Room. Copies of such filing will also be 1. Transaction Charges processing information with respect to, available for inspection and copying at and facilitating transactions in No change. the principal office of the Amex. All II. Regulatory Fee securities, to remove impediments to submissions should refer to file number and perfect the mechanism of a free and No Change. SR-Amex-2002–105 and should be Notes: open market and a national market submitted by April 3, 2003. system, and, in general, to protect 1. and 2. No change. investors and the public interest. For the Commission, by the Division of 3. Customer transaction charges for Market Regulation, pursuant to delegated the following Portfolio Depositary B. Self-Regulatory Organization’s authority.6 Receipts, Index Fund Shares, and Trust Statement on Burden on Competition Margaret H. McFarland, Issued Receipts have been suspended: The Exchange believes that the Deputy Secretary. DIA—DIAMONDS  proposed rule change, as amended, will [FR Doc. 03–5994 Filed 3–12–03; 8:45 am] QQQ—Nasdaq–100 Index Tracking impose no burden on competition not BILLING CODE 8010–01–P Stock necessary or appropriate in furtherance SPY–SPDRs of the purposes of the Act. IVV—iShares S&P 500 SECURITIES AND EXCHANGE MDY—MidCap SPDRs C. Self-Regulatory Organization’s COMMISSION XLY—Select Sector SPDR—Consumer Statement on Comments on the Discretionary Proposed Rule Change Received From XLP—Select Sector SPDR—Consumer Members, Participants or Others [Release No. 34–47455; File No. SR–Amex– 2003–15] Staples No written comments were solicited XLE—Select Sector SPDR—Energy or received in response to the proposed Self-Regulatory Organizations; Notice XLF—Select Sector SPDR—Financial rule change. of Filing and Immediate Effectiveness XLV—Select Sector SPDR—Health Care of Proposed Rule Change by the XLI—Select Sector SPDR—Industrial III. Date of Effectiveness of the XLB—Select Sector SPDR—Materials Proposed Rule Change and Timing for American Stock Exchange LLC To Extend the Suspension of Transaction XLK—Select Sector SPDR—Technology Commission Action XLU—Select Sector SPDR—Utilities Charges for Certain Exchange-Traded BHH–B2B Internet HOLDRsTM Within 35 days of the date of Funds publication of this notice in the Federal BBH—Biotech HOLDRs Register or within such longer period (i) March 6, 2003. BDH—Broadband HOLDRs As the Commission may designate up to EKH—Europe 2001 HOLDRs Pursuant to Section 19(b)(1) of the 90 days of such date if it finds such IAH—Internet Architecture HOLDRs Securities Exchange Act of 1934 longer period to be appropriate and HHH—Internet HOLDRs (‘‘Act’’),1 and Rule 19b–4 thereunder,2 publishes its reasons for so finding or IIH—Internet Infrasturcture HOLDRs notice is hereby given that on March 4, (ii) as to which the Exchange consents, MKH—Market 2000+ HOLDRs 2003, the American Stock Exchange LLC the Commission will: OIH—Oil Service HOLDRs (A) By order approve such proposed (‘‘Amex’’) filed with the Securities and PPH—Pharmaceutical HOLDRs rule change, or Exchange Commission (‘‘SEC’’ or RKH—Regional Bank HOLDRs (B) Institute proceedings to determine ‘‘Commission’’) the proposed rule RTH—Retail HOLDRs whether the proposed rule change change as described in Items I and II SMH—Semiconductor HOLDRs should be disapproved. below, which Items have been prepared SWH—Software HOLDRs by the Exchange. The Commission is TTH—Telecom HOLDRs IV. Solicitation of Comments publishing this notice to solicit UTH—Utilities HOLDRs Interested persons are invited to comments on the proposed rule change. WMH—Wireless HOLDRs submit written data, views and SHY—iShares Lehman 1–3 Year 6 17 CFR 200.30–3(a)(12). Treasury Bond Fund 4 15 U.S.C. 78f(b). 1 15 U.S.C. 78s(b)(1). IEF—iShares Lehman 7–10 Year 5 15 U.S.C. 78f(b)(5). 2 17 CFR 240.19b–4. Treasury Bond Fund

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TLT—iShares Lehman 20+ Year March 31, 2003 for the iShares S&P 100 time within 60 days of the filing of such Treasury Bond Fund Index Fund (Symbol: OEF), an proposed rule change, the Commission LQD—iShares GS $ InvesTop Corporate Exchange-Traded Fund that the may summarily abrogate such rule Bond Fund Exchange will trade pursuant to change if it appears to the Commission TFT—Treasury 1 FITR ETF unlisted trading privileges. that such action is necessary or TOU—Treasury 2 FITR ETF The Exchange believes a suspension appropriate in the public interest, for TFI—Treasury 5 FITR ETF of fees for these securities is appropriate the protection of investors or otherwise TTE—Treasury 10 FITR ETF to enhance the competitiveness of in furtherance of the purposes of the Until March 31, 2003, customer executions in these securities on the Act. transaction charges for the iShares S&p Amex. The Exchange will reassess the The Amex has requested that the 100 Index Fund (OEF) have been fee suspension as appropriate, and will Commission waive the 30-day operative suspended. file any modification to the fee delay. The Commission believes that Until [February 28] March 31, 2003, suspension with the Commission waiving the 30-day operative delay is transaction charges also have been pursuant to Section 19(b)(3)(A) of the consistent with the protection of suspended in SHY, IEF, TFT, TOU, TFI 1934 Act. investors and the public interest. The and TTE for specialist, Registered Commission notes that fee suspensions 2. Statutory Basis Trader and broker dealer orders. for the exchange-trade funds that are the * * * * * The Exchange believes that the subject of this filing have been proposed rule change is consistent with previously filed with the Commission.11 II. Self-Regulatory Organization’s Section 6(b) of the Act 7 in general, and Statement of the Purpose of, and Further, extension of the fee suspension furthers the objectives of Section for specialist, Registered Trader, and Statutory Basis for, the Proposed Rule 6(b)(4) 8 in particular, in that it provides Change broker-dealer orders will permit the fee for the equitable allocation of reasonable suspensions to continue uninterrupted. In its filing with the Commission, the dues, fees and other charges among its With regard to the iShares S&P 100 Amex included statements concerning members and other persons using its Index Fund, acceleration of the the purpose of and basis for the facilities. operative date will permit the Amex to proposed rule change and discussed any suspend these fees immediately. For comments it received on the proposed B. Self-Regulatory Organization’s Statement on Burden on Competition these reasons, the Commission rule change. The text of these statements designates the proposal to be effective may be examined at the places specified The Exchange does not believe that and operative upon filing with the in Item IV below. The Exchange has the proposed rule change will impose Commission.12 prepared summaries, set forth in Section any burden on competition. A, B, and C below, of the most IV. Solicitation of Comments C. Self-Regulatory Organization’s significant aspects of such statements. Statement on Comments on the Interested persons are invited to A. Self-Regulatory Organization’s Proposed Rule Change Received From submit written data, views, and Statement of the Purpose of, and Members, Participants or Others arguments concerning the foregoing, including whether the proposed rule Statutory Basis for, the Proposed Rule The Exchange has neither solicited Change change is consistent with the Act. nor received comments on the proposed Persons making written submissions 1. Purpose rule change. should file six copies thereof with the The Exchange is extending until III. Date of Effectiveness of the Secretary, Securities and Exchange March 31, 2003 the suspension of Proposed Rule Change and Timing for Commission, 450 Fifth Street, NW., transaction charges in iShares Lehman Commission Action Washington, DC 20549–0609. Copies of 1–3 year Treasury Bond Fund (Symbol: the submission, all subsequent The foregoing rule change has become amendments, all written statements SHY); iShares Lehman 7–10 year effective pursuant to Section 19(b)(3)(A) Treasury Bond Fund (Symbol: IZEF); 9 10 with respect to the proposed rule of the Act and Rule 19b–4(f)(6) change that are filed with the Treasury 10 FITR ETF (Symbol: TTE); thereunder because the proposal: (i) Treasury 5 FITR ETF (TFI); Treasury 2 Commission, and all written Does not significantly affect the communications relating to the FITR ETF (TOU); and Treasury 1 FITR protection of investors or the public ETF (TFT) for specialist, Registered proposed rule change between the interest; (ii) does not impose any Commission and any person, other than Trader and broker-dealer orders. The significant burden on competition; and Exchange previously filed a suspension those that may be withheld from the (iii) does not become operative prior to public in accordance with the in such charges until November 30, 30 days after the date of filing such 3 4 provisions of 5 U.S.C. 552, will be 2002, December 13, 2002, January 31, shorter time as the Commission may 2003,5 and February 28, 2003.6 2003. available for inspection and copying at designate if consistent with the the Commission’s Public Reference The Exchange is also suspending protection of investors and the public customer transaction charges until Room. Copies of such filing will also be interest. The Exchange gave the available for inspection and copying at Commission notice of its intent to file 3 See Securities Exchange Act Release No. 46765 the principal office of the Exchange. All (November 1, 2002), 67 FR 68893 (November 13, the proposed rule change, along with a submissions should refer to File No. 2002) (SR–Amex–2002–91). brief description and text of the SR–Amex–2003–15 and should be 4 See Securities Exchange Act Release No. 46996 proposed rule change, at least five submitted by April 3, 2003. (December 13, 2002), 67 FR 78264 (December 23, business days prior to the date of filing 2002) (SR–Amex–2002–98). of the proposed rule change. At any 5 See Securities Exchange Act Release No., 47141 11 See supra notes 3, 4, 5, and 6. (January 8, 2003), 68 FR 2090 (January 15, 2003) 12 For purposes only of accelerating the operative 7 (SR–Amex–2002–115). 15 U.S.C. 78f(b). date of this proposal, the Commission has 6 See Securities Exchange Act Release No. 47361 8 15 U.S.C. 78f(b)(4). considered the proposed rule’s impact on (February 13, 2003), 68 FR 8534 (February 21, 2003 9 15 U.S.C. 78s(b)(3)(A). efficiency, competition, and capital formation. 15 (SR–Amex–2003–04). 10 17 CFR 240.19b–4(f)(6). U.S.C. 78c(f).

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For the Commission, by the Division of Execution System, which govern, among and sends that order to the specialist via Market Regulation, pursuant to delegated other things, display of limit orders in the MAX system, the specialist receiving authority.13 a specialist’s book. The text of the such order shall display the limit order Margaret H. McFarland, proposed rule change is below. in zero seconds. Such order will not be Deputy Secretary. Proposed new language is in italics. entitled to primary market price [FR Doc. 03–6068 Filed 3–12–03; 8:45 am] protection or other protections due limit Chicago Stock Exchange Rules BILLING CODE 8010–01–M orders under Article XX, Rule 37(a)(3). Article XX Regular Trading Sessions * * * * * * * * * * SECURITIES AND EXCHANGE Guaranteed Execution System and COMMISSION Recognized Quotations Midwest Automated Execution System [Release No. 34–47443; File No. SR–CHX– RULE 7 * * * * * 2002–40] No change to text. RULE 37(a). Guaranteed Executions. Self-Regulatory Organizations; Notice •••Interpretations and Policies: * * * * * 3. Dual Trading System Agency Limit of Filing of Proposed Rule Change by .01–.04 No change to text. Orders. Subject to Interpretation and the Chicago Stock Exchange, Inc. .05 (a) Quotation sizes, unless Policy .10 (‘‘Exempted Trade- Relating to Zero-Second Display of otherwise specified, shall be assumed to Certain Limit Orders Throughs’’), all agency limit orders in be for 100 shares. With respect to Dual Trading System issues will be agency limit orders received by March 4, 2003. filled under the following specialists, each specialist shall publish Pursuant to section 19(b)(1) of the circumstances: immediately (i.e., as soon as practicable, Securities Exchange Act of 1934 (a) Exhaustion of primary market bid which under normal circumstances (‘‘Act’’),1 and Rule 19b–4 thereunder,2 or offer. When the bid or offering at the means no later than 30 seconds from notice is hereby given that on December limit price has been exhausted in the time of receipt, subject to the provisions 26, 2002, the Chicago Stock Exchange, primary market (as defined in the CTA below relating to agency limit orders Inc. (‘‘CHX’’ or ‘‘Exchange’’) filed with plan), agency limit orders will be designated ‘‘post protection only’’) a bid the Securities and Exchange executed in whole or in part, based on or offer that reflects: Commission (‘‘Commission’’) the the rules of priority and precedence, on (i) The price and full size of each proposed rule change as described in a share for share basis with trades agency limit order that is at a price that Items I, II, and III below, which Items executed at the limit price in the would improve the specialist’s bid or have been prepared by the Exchange. primary market; offer in such security; and On January 10, 2003, the exchange filed (b) Price penetration in primary (ii) The full size of each agency limit an amendment to the proposed rule market. When there has been a price order that is priced equal to the change.3 The Commission is publishing penetration of the limit in the primary specialist’s bid or offer for such security. this notice to solicit comments on the market, agency limit orders that have (b) The requirements with respect to proposed rule change, as amended, from resided in the specialist’s book for a specialists’ display of limit orders shall interested persons.4 period of 0–15 seconds (as designated not apply to any limit order that is: by the specialist) prior to the primary I. Self-Regulatory Organization’s (i) Executed upon receipt of the order; market print will be filled at the limit Statement of the Terms of Substance of (ii) Placed by a person or entity who price; the Proposed Rule Change expressly requests, either at the time the (c) Primary market trading at the limit The Exchange proposes to amend order is placed or prior thereto pursuant price. When the issue is trading at the Article XX, Regular Trading Sessions, to an individually negotiated agreement limit price on the primary market, CHX Rule 7, Recognized Quotations, with respect to such person’s orders, agency limit orders will be filled at the and CHX Rule 37, Guaranteed Execution that the order not be displayed; limit price unless it can be (iii) An odd-lot order; System and Midwest Automated demonstrated that such orders would (iv) Delivered immediately upon not have been executed if they had been 13 17 CFR 200.30–3(a)(12). receipt to an exchange or association- transmitted to the primary market or the 1 15 U.S.C. 78s(b)(1). sponsored system or an electronic broker and specialist agree to a specific 2 17 CFR 240.19b–4. communications network that complies volume related or other criteria for 3 See letter, dated January 9, 2003, from Kathleen with the requirements of Securities and requiring a fill; and M. Boege, Associate General Counsel, CHX, to Exchange Commission Rule 11Ac1– (d) Block size trade-through in Nancy J. Sanow, Assistant Director, Division of 1(c)(5) under the Securities Exchange another market. In instances where a Market Regulation (‘‘Division’’), Commission (‘‘Amendment No. 1’’). In Amendment No. 1, the Act with respect to that order; block trade on the Exchange or other CHX provided additional clarity as to the full extent (v) Delivered immediately upon market against which orders are being of limit order protection that would be forfeited by receipt to another exchange member or protected takes place outside the current a floor broker that elects ‘‘post protection only’’ over-the-counter market maker that Exchange quotation, all effective bids or (‘‘PPO’’) under the proposed rule change. 4 The CHX requested that the Commission make complies with the requirements of offers limited to the block price or better various non-substantive typographical corrections Securities and Exchange Commission will be executed at the more favorable to the notice in the rule language and purpose Rule 11Ac1–4 under the Securities block price rather than at the limit price section. In addition, the CHX requested that the Exchange Act with respect to that order; of the affected orders. A specialist may Commission add an additional protection related to block trades as described in footnote 7 below. Such (vi) An all or none order; or elect to provide automatic execution of protection was added due to an intervening CHX (vii) A block size order, unless the designated limit orders at the block rule change that was not in place at the time of customer order is received with a price or better when a ‘‘block size’’ (as filing of the instant proposed rule change. request that the order be displayed. defined in Article XX, Rule 40, Telephone conference between Kathleen M. Boege, Associate General Counsel, CHX, and Christopher If a floor broker designates an agency Interpretation and Policy .05) trade- B. Stone, Special Counsel, Division, Commission limit order, in a manner specified by the through is executed on the primary (March 3, 2003). Exchange, as ‘‘post protection only,’’ market.

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A specialist may elect automatic In some cases, however, customers denied the opportunity to interact with execution of such agency limit orders on expressly desire the zero-second display the order. an issue-by-issue basis. The foregoing of their orders. Specifically, the CHX The CHX believes that the proposal is provisions of this Article XX, Rule has been advised that, for certain consistent with the interests of the 37(a)(3) shall not apply to limit orders customers of CHX floor brokers, zero- investing public, as a floor broker will designated by a floor broker as ‘‘post second display of their limit orders is be able to elect zero-second display of protection only’’ in accordance with the often their paramount consideration. a limit order when that display is either provisions of Article XX, Rule 7, While CHX specialists may choose not requested by the customer or otherwise Interpretation and Policy .05. to display each limit order in zero is in a customer’s interest.8 In other instances, an order-sending firm may II. Self-Regulatory Organization’s seconds—because they may wish to consider the protections of Article XX, Statement of the Purpose of, and have the opportunity to decide whether Rule 37(a)(3) to constitute a better Statutory Basis for, the Proposed Rule or not to interact with certain limit means of achieving its customer’s goals, Change orders—the CHX floor broker community has suggested a solution in which case the floor broker could In its filing with the Commission, the which protects the interests of CHX elect to forego zero-second display. Exchange included statements member order-sending firms and their 2. Statutory Basis concerning the purpose of and basis for customers, while permitting CHX the proposed rule change and discussed specialists to appropriately handle limit The Exchange believes that the any comments it received on the orders. proposed rule change is consistent with proposed rule change. The text of these the provisions of section 6(b) of the statements may be examined at the Under the proposed rule change, PPO Act,9 in general, and Section 6(b)(5) of places specified in Item IV below. The orders (as designated by a CHX floor the Act,10 in particular, which requires, Exchange has prepared summaries, set broker) would be automatically among other things, that the rules of an forth in Sections A, B, and C below, of displayed by the specialist in zero exchange be designed, among other the most significant aspects of such seconds without any opportunity for a things, to promote just and equitable statements. specialist to interact with the order prior principles of trade, to remove to display. PPO orders would be treated impediments to and perfect the A. Self-Regulatory Organization’s in accordance with applicable CHX Statement of the Purpose of, and mechanism of a free and open market rules governing priority and precedence, and a national market system, and, in Statutory Basis for, the Proposed Rule but would not be entitled to trade Change general to protect investors and the through protection by the CHX public interest. 1. Purpose specialist in the event of a price penetration in the primary market.7 This B. Self-Regulatory Organization’s The Exchange proposes to amend Statement on Burden on Competition Article XX, Rules 7 and 37 of the CHX solution will afford CHX floor brokers Rules, which govern, among other the flexibility to elect zero-second The Exchange does not believe that things, display of limit orders in a display of their customers’ limit orders the proposed rule change will impose specialist’s book and execution prices in instances that render such immediacy any burden on competition that is not due certain limit orders. The proposed of paramount concern. The proposal in necessary or appropriate in furtherance change would permit a CHX member turn does not require a specialist to of the purposes of the Act. (including a floor broker) to elect zero- provide subject limit orders with trade C. Self-Regulatory Organization’s second display by a CHX specialist of through protection or the other Statement on Comments on the limit orders designated by the member protections set forth in Article XX, Rule Proposed Rule Change Received From as PPO orders. 37(a)(3), when the specialist has been Members, Participants or Others Under Exchange Act Rule 11Ac1–4 5 and current Article XX, Rule 7 provided in the CHX trading system. These default The Exchange has neither solicited (Interpretation and Policy .05) of the timers, which can be set, among other things, from nor received written comments on the zero to 25 seconds (in listed securities) or from zero proposed rule change. CHX Rules, a CHX specialist must to 30 seconds (in over-the-counter (‘‘OTC’’) display customer limit orders securities), ensure that eligible orders are III. Date of Effectiveness of the ‘‘immediately,’’ which means ‘‘*** as automatically displayed when they improve a Proposed Rule Change and Timing for soon as practicable, which under specialist’s quote and when the timer setting has Commission Action elapsed without the orders having been manually normal market conditions means no displayed, executed or transferred to another Within 35 days of the date of later than 30 seconds from time of marketplace. In addition, the CHX Market publication of this notice in the Federal receipt.’’ Although past studies have Regulation Department actively surveils to ensure shown that CHX specialists, through the that CHX specialists do not routinely rely on their timers to extend the display period beyond what is 8 Orders routed to a CHX floor broker constitute use of automated tools, display the vast necessary for the specialist to interact with the limit orders from sophisticated investors who choose to majority of customer limit orders within orders they receive. utilize the services of a floor broker because, among zero seconds after they are required to 7 Under Article XX, Rule 37(a)(3), a limit order for other reasons, the investor can communicate certain do so, CHX specialists may choose to a Dual Trading System (i.e., listed) issue, which is conditions regarding execution of the order, which resident in a CHX specialist’s book for 15 seconds conditions the floor broker will take into account actually see one or more orders before or more, generally is entitled to ‘‘trade through in seeking liquidity to fill the order. Such investors deciding whether or not to execute the protection,’’ i.e., execution at the limit price in the possess sufficient market experience to fully order, transfer the order to another event of a price penetration in the primary market. evaluate the consequences of having their floor Article XX, Rule 37(a)(3) also requires execution at broker elect the PPO order option on their behalf. marketplace or display the order at the By restricting the PPO order option to floor brokers, 6 the limit price, subject to certain conditions, (a) if Exchange. the bid or offer has been exhausted in the primary the CHX believes that it will avoid instances where market, (b) if the issue is trading at the limit price less sophisticated investors would elect zero-second 5 17 CFR 240.11Ac1–4 (‘‘Display Rule’’). in the primary market, and (c) if a block trade has display of their limit orders, without fully 6 Specialists can help ensure that they meet their been printed on the Exchange or an away market considering the ramifications of foregoing primary Display Rule obligations with respect to these at superior price. A floor broker electing PPO would market protection of such limit orders. manually handled orders by using additional also forego these protections otherwise due under 9 15 U.S.C. 78f(b). automated functions, such as the default timers Article XX, Rule 37(a)(3). 10 15 U.S.C. 78f(b)(5).

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Register or within such longer period (i) withheld from the public in accordance (‘‘Act’’),1 and Rule 19b–4 thereunder,2 as the Commission may designate up to with the provisions of 5 U.S.C. 552, will notice is hereby given that on February 90 days of such date if it finds such be available for inspection and copying 26, 2003, the International Securities longer period to be appropriate and in the Commission’s Public Reference Exchange, Inc. (‘‘Exchange’’ or ‘‘ISE’’) publishes its reasons for so finding or Room. Copies of such filing will also be filed with the Securities and Exchange (ii) as to which the Exchange consents, available for inspection and copying at Commission (‘‘SEC’’ or ‘‘Commission’’) the Commission will: the principal office of the Exchange. All the proposed rule change as described (A) By order approve such proposed submissions should refer to File No. in Items I, II, and III below, which items rule change, as amended, or SR–CHX–2002–40 and should be have been prepared by the ISE. The (B) institute proceedings to determine submitted by April 3, 2003. Commission is publishing this notice to whether the proposed rule change, as For the Commission, by the Division of solicit comments on the proposed rule amended, should be disapproved. Market Regulation, pursuant to delegated authority.11 change from interested persons. IV. Solicitation of Comments Margaret H. McFarland, I. Self-Regulatory Organization’s Interested persons are invited to Deputy Secretary. Statement of the Terms of Substance of submit written data, views, and [FR Doc. 03–5995 Filed 3–12–03; 8:45 am] the Proposed Rule Change arguments concerning the foregoing, BILLING CODE 8010–01–P including whether the proposed rule The Exchange is proposing changes to change, as amended, is consistent with its Schedule of Fees regarding complex the Act. Persons making written SECURITIES AND EXCHANGE orders. First, the Exchange proposes to submissions should file six copies COMMISSION charge its regular execution fees only on thereof with the Secretary, Securities one leg of the complex order (as and Exchange Commission, 450 Fifth [Release No. 34–47449; File No. SR–ISE– 2003–08] opposed to charging on each leg). Street, NW., Washington, DC 20549– Second, the Exchange proposes to waive 0609. Copies of the submission, all Self-Regulatory Organizations; Notice all such execution fees for complex subsequent amendments, all written of Filing and Immediate Effectiveness orders through June 30, 2003. Below is statements with respect to the proposed of Proposed Rule Change by the the text of the proposed rule change. rule change, as amended, that are filed International Securities Exchange, Inc., Proposed new language is in italics. with the Commission, and all written Relating to Fee Changes communications relating to the * * * * * proposed rule change, as amended, March 5, 2003. between the Commission and any Pursuant to Section 19(b)(1) of the person, other than those that may be Securities Exchange Act of 1934

ISE SCHEDULE OF FEES [Electronic Market Place]

Amount Execution fees ($) Billable unit Frequency Notes

Customer ...... 0.05 contract/side ...... Transaction ...... Fee waived through June 30, 2003. Facilitation ...... 0.15 contract/side ...... Transaction ...... Market Maker & Firm Proprietary ...... For Complex Orders, charged only for the leg (including members of other ex- of the trade consisting of the most con- changes executing Linkage tracts; Firm Proprietary fees for trades exe- transactions, except Satisfaction cuted in the Block Order Mechanism and Orders). for all trades in the iShares S&P 100 Index Fund waived through May 31, 2003; fees for Complex Orders waived through June 30, 2003. A.D.V. Less Than 300,000 ...... 0.21 contract/side ...... Transaction ...... Based on Exchange A.D.V. A.D.V. From 300,001 to 500,000 ... 0.17 contract/side ...... Transaction ...... Based on Exchange A.D.V. A.D.V. From 500,001 to 700,000 ... 0.14 contract/side ...... Transaction ...... Based on Exchange A.D.V. A.D.V. Over 700,000 ...... 0.12 contract/side ...... Transaction ...... Based on Exchange A.D.V.

* * * * * statements may be examined at the A. Self-Regulatory Organization’s places specified in Item IV below. The Statement of the Purpose of, and II. Self-Regulatory Organization’s Statement of the Purpose of, and Exchange has prepared summaries, set Statutory Basis for, the Proposed Rule Statutory Basis for, the Proposed Rule forth in sections A, B and C below, of Change the most significant aspects of such Change 1. Purpose statements. In its filing with the Commission, the The Exchange is proposing changes to Exchange included statements its Schedule of Fees regarding complex concerning the purpose of, and basis for, orders in an attempt to provide its the proposed rule change and discussed members with an incentive to execute any comments it received on the complex orders on the Exchange. proposed rule change. The text of these

11 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4.

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The Exchange currently applies its may summarily abrogate such rule notice is hereby given that on February regular execution fees to complex change if it appears to the Commission 26, 2003, the National Association of orders. Because these trades generally that such action is necessary or Securities Dealers, Inc. (‘‘NASD’’ or are effected on low margins, the appropriate in the public interest, for ‘‘Association’’), through its subsidiary, imposition of the regular execution fees the protection of investors, or otherwise The Nasdaq Stock Market, Inc. may render some trades uneconomical. in furtherance of the purposes of the (‘‘Nasdaq’’), filed with the Securities Accordingly, the Exchange proposes to Act. and Exchange Commission (‘‘Commission’’ or ‘‘SEC’’) the proposed charge its regular execution fees only on IV. Solicitation of Comments one leg of the complex order (as rule change as described in Items I and opposed to charging on each leg). Interested persons are invited to II below, which Items have been Specifically, the Exchange would charge submit written data, views and prepared by Nasdaq. The Commission is a fee on the leg with the most contracts. arguments concerning the foregoing, publishing this notice to solicit For example, if there is a simple two- including whether the proposed rule comments on the proposed rule change legged spread to buy 100 contracts of change is consistent with the Act. from interested persons and is one series and to sell 100 contracts of Persons making written submissions approving the proposal on an another series, ISE would charge a fee should file six copies thereof with the accelerated basis. Secretary, Securities and Exchange for 100 contracts. In a three-legged trade I. Self-Regulatory Organization’s of 100 contracts, 50 contracts and 50 Commission, 450 Fifth Street, NW., Washington, DC 20549–0609. Copies of Statement of the Terms of the Substance contracts, ISE also would charge a fee of the Proposed Rule Change for 100 contracts. In a complex trade the submission, all subsequent with both an option and a non-option amendments, all written statements Nasdaq proposes to list and trade with respect to the proposed rule Market Recovery NotesSM Linked to the leg, ISE would charge a fee for the  option leg. change that are filed with the S&P 500 Index (‘‘Notes’’) issued by In addition, the Exchange is Commission, and all written Merrill Lynch & Co., Inc. (‘‘Merrill proposing to waive all execution fees for communications relating to the Lynch’’). proposed rule change between the complex orders through June 30, 2003. II. Self-Regulatory Organization’s Commission and any person, other than Statement of the Purpose of, and 2. Basis those that may be withheld from the Statutory Basis for, the Proposed Rule public in accordance with the The basis under the Act for this Change proposed rule change is the requirement provisions of 5 U.S.C. 552, will be under Section 6(b)(4) of the Act that an available for inspection and copying in In its filing with the Commission, Nasdaq included statements concerning exchange have an equitable allocation of the Commission’s Public Reference the purpose of and basis for the reasonable dues, fees and other charges Section. Copies of such filing will also proposed rule change and discussed any among its members and other persons be available for inspection and copying comments it received on the proposed using its facilities.3 at the principal office of the ISE. All submissions should refer to File No. rule change. The text of these statements B. Self-Regulatory Organization’s SR–ISE–2003–08 and should be may be examined at the places specified Statement on Burden on Competition submitted by April 3, 2003. in Item III below. Nasdaq has prepared The proposed rule change does not summaries, set forth in Sections A, B, For the Commission, by the Division of and C below, of the most significant impose any burden on competition that Market Regulation, pursuant to delegated is not necessary or appropriate in authority.6 aspects of such statements. furtherance of the purposes of the Act. Margaret H. McFarland, A. Self-Regulatory Organization’s Statement of the Purpose of, and C. Self-Regulatory Organization’s Deputy Secretary. Statutory Basis for, the Proposed Rule Statement on Comments on the [FR Doc. 03–6067 Filed 3–12–03; 8:45 am] Change Proposed Rule Change Received from BILLING CODE 8010–01–P Members, Participants or Others 1. Purpose The Exchange has not solicited, and SECURITIES AND EXCHANGE Nasdaq proposes to list and trade does not intend to solicit, comments on COMMISSION notes, the return on which is based this proposed rule change. The upon the S&P 500 Index (‘‘Index’’).3 Exchange has not received any [Release No. 34–47464; File No. SR–NASD– 2003–22] unsolicited written comments from 3 The Index is published by Standard & Poor’s, a members or other interested parties. division of The McGraw-Hill Companies, Inc. Self-Regulatory Organizations; Notice (‘‘Standard & Poor’s’’ or S&P’’) and is intended to III. Date of Effectiveness of the of Filing and Order Granting provide an indication of the pattern of common Accelerated Approval of Proposed stock price movement. The Index is a Proposed Rule Change and Timing for capitalization-weighted index, with each stock’s Commission Action Rule Change by the National weight in the Index proportionate to its market Association of Securities Dealers, Inc. value. The value of the Index is based on the The foregoing rule change, which Relating to the Listing and Trading of relative value of the aggregate market value of the establishes or changes a due, fee or Market Recovery Notes Linked to the common stocks of 500 companies as of a particular other charge imposed by the Exchange, S&P 500 Index time compared to the aggregate average market has become effective pursuant to value of the common stocks of 500 similar 4 companies during the base period of the years 1941 Section 19(b)(3)(A) of the Act and Rule March 7, 2003. through 1943. The market value for the common 19b–4(f)(2) 5 thereunder. At any time Pursuant to section 19(b)(1) of the stock of a company is the product of the market within 60 days of the filing of such Securities Exchange Act of 1934 price per share of the common stock and the proposed rule change, the Commission (‘‘Act’’),1 and Rule 19b–4 thereunder,2 number of outstanding shares of common stock. As of January 31, 2003, 424 companies, or 85.5% of the market capitalization of the Index, traded on the 3 15 U.S.C. 78f(b)(4). 6 17 CFR 200.30–3(a)(12). New York Stock Exchange (‘‘NYSE’’); 74 4 15 U.S.C. 78s(b)(3)(A). 1 15 U.S.C. 78s(b)(1). companies, or 14.3% of the market capitalization of 5 17 CFR 19b–4(f)(2). 2 17 CFR 240.19b–4. the Index traded on The Nasdaq Stock Market; and

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Under NASD Rule 4420(f), Nasdaq At maturity, if the value of the S&P The payment that a beneficial owner may approve for listing and trading 500 Index has increased, a beneficial will be entitled to receive (the innovative securities that cannot be owner will be entitled to receive a ‘‘Redemption Amount’’) depends readily categorized under traditional payment on the Notes based on triple entirely on the relation of the average of listing guidelines.4 Nasdaq proposes to the amount of that percentage increase, the values of the S&P 500 Index at the list for trading the, as described below, not to exceed a maximum payment per close of the market on five business under NASD Rule 4420(f). Unit (the ‘‘Capped Value’’) that is days shortly before the maturity of the expected to be between $11.60 and Description of the Notes Notes (the ‘‘Ending Value’’) and the $12.00.6 Thus, the Notes provide closing value of the S&P 500 Index on The Notes are a series of senior non- investors the opportunity to obtain the date the Notes are priced for initial convertible debt securities that will be leveraged returns based on the S&P 500 sale to the public (the ‘‘Starting Value’’). issued by Merrill Lynch and will not be Index subject to a cap that is expected secured by collateral. The Notes will to represent an appreciation of 16% to If the Ending Value is less than or have a term of not less than one and not 20% over the original public offering equal to the Starting Value, the more than four years. The Notes will be price of the Notes. Unlike ordinary debt Redemption Amount per Unit will issued in denominations of whole units securities, the Notes do not guarantee equal: (‘‘Unit’’), with each Unit representing a any return of principal at maturity.  Ending Value  single Note. The original public offering Therefore, if the value of the S&P 500 $10 ×   price will be $10 per Unit. The Notes Index has declined at maturity, a  Starting Value will not pay interest and are not subject beneficial owner will receive less, and to redemption by Merrill Lynch or at the possibly significantly less, than the If the Ending Value is greater than the option of any beneficial owner before original public offering price of $10 per Starting Value, the Redemption Amount maturity in 2004.5 Unit.7 per Unit will equal:

  Ending Value− Starting V alue $10+× $30     Starting Value 

provided, however, the Redemption have been linked to or based on, the million; or (ii) assets in excess of $100 Amount cannot exceed the Capped S&P 500 Index.8 million and stockholders’ equity of at least $20 million; Value. Criteria for Initial and Continued Listing The Notes are cash-settled in U.S. (B) There must be a minimum of 400 The Notes, which will be registered dollars and do not give the holder any holders of the security, provided, under section 12 of the Act, will however, that if the instrument is traded right to receive a portfolio security, initially be subject to Nasdaq’s listing dividend payments or any other in $1,000 denominations, there must be criteria for other securities under NASD a minimum of 100 holders; ownership right or interest in the Rule 4420(f). Specifically, under NASD (C) For equity securities designated portfolio or index of securities Rule 4420(f)(1): comprising the S&P 500 Index. The (A) The issuer shall have assets in pursuant to this paragraph, there must Notes are designed for investors who excess of $100 million and stockholders’ be a minimum public distribution of want to participate or gain exposure to equity of at least $10 million. In the case 1,000,000 trading units; the S&P 500 Index, subject to a cap, and of an issuer which is unable to satisfy (D) The aggregate market value/ who are willing to forego market interest the income criteria set forth in principal amount of the security will be payments on the Notes during such paragraph (a)(1), Nasdaq generally will at least $4 million. term. The Commission has previously require the issuer to have the following: In addition, Nasdaq notes that Merrill approved the listing of options on, and (i) assets in excess of $200 million and Lynch satisfies the listed marketplace securities the performance of which stockholders’ equity of at least $10 requirement set forth in NASD Rule

2 companies, or 0.2% of the market capitalization responsive to changes in the affairs of the respective price) would correspond to any decline in value of of the Index, traded on the American Stock industry and the market value and trading activity the S&P 500. Telephone conversation between John Exchange (‘‘AMEX’’). As of January 31, 2003, the of the common stock of that company. Ten main D. Nachmann, Senior Attorney, Nasdaq, and aggregate market value of the 500 companies groups of companies comprise the Index with the Florence E. Harmon, Senior Special Counsel, included in the Index represented approximately percentage weight of the companies included in Division of Market Regulation (‘‘Division’’), 79% of the aggregate market value of stocks each group indicated in parentheses as of February Commission, on March 7, 2003. 18, 2003: Consumer Discretionary (13.4%), included in the Standard & Poor’s Stock Guidance 8 See Securities Exchange Act Release No. 19907 Database of domestic common stocks traded in the Consumer Staples (9.4%), Energy (6.0%), Financials (20.6%), Health Care (15.3%), Industrials (11.3%), (June 24, 1983), 48 FR 30814 (July 5, 1983) U.S., excluding American depositary receipts, (approving the listing and trading of options on the limited partnerships and mutual funds. Standard & Information Technology (14.4%), Materials (2.8%), S&P 500 Index); Securities Exchange Act Release Poor’s chooses companies for inclusion in the Index Telecommunication Services (4.0%), and Utilities No. 31591 (December 11, 1992), 57 FR 60253 with the aim of achieving a distribution by broad (2.8%). 4 (December 18, 1992) (approving the listing and industry groupings that approximates the See Securities Exchange Act Release No. 32988 distribution of these groupings in the common stock (September 29, 1993); 58 FR 52124 (October 6, trading of Portfolio Depositary Receipts based on population of the Standard & Poor’s Stock Guide 1993) (order approving File No. SR–NASD–93–15), the S&P 500 Index); Securities Exchange Act Database, which Standard & Poor’s uses as an (‘‘1993 Order’’). Release No. 27382 (October 26, 1989), 54 FR 45834 assumed model for the composition of the total 5 The actual maturity date will be determined on (October 31, 1989) (approving the listing and market. Relevant criteria employed by Standard & the day the Notes are priced for initial sale to the trading of Exchange Stock Portfolios based on the Poor’s include the viability of the particular public. value of the S&P 500 Index); and Securities company, the extent to which that company 6 The actual Capped Value will be determined at Exchange Act Release No. 30394 (February 21, represents the industry group to which it is the time of issuance of the Notes. 1992), 57 FR 7409 (March 2, 1992) (approving the assigned, the extent to which the market price of 7 Any amount the beneficial owner would receive listing and trading of a unit investment trust linked that company’s common stock is generally at maturity (which is less than the original offering to the S&P 500 Index).

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4420(f)(2).9 Lastly, pursuant to NASD addition, as previously described, C. Self-Regulatory Organization’s Rule 4420(f)(3), prior to the Nasdaq will distribute a circular to Statement on Comments on the commencement of trading of the Notes, members providing guidance regarding Proposed Rule Change Received From Nasdaq will distribute a circular to compliance responsibilities and Members, Participants, or Others members providing guidance regarding requirements, including suitability Written comments were neither member firm compliance recommendations, and highlighting the solicited nor received. responsibilities and requirements, special risks and characteristics of the including suitability recommendations, Notes. Furthermore, the Notes will be III. Solicitation of Comments and highlighting the special risks and subject to the equity margin rules. Interested persons are invited to characteristics of the Notes. In Lastly, the regular equity trading hours submit written data, views, and particular, Nasdaq will advise members of 9:30 a.m. to 4 p.m. will apply to arguments concerning the foregoing, recommending a transaction in the transactions in the Notes. including whether the proposed rule Notes to: (1) Determine that such change is consistent with the Act. transaction is suitable for the customer; Nasdaq represents that NASD’s Persons making written submissions and (2) have a reasonable basis for surveillance procedures are adequate to should file six copies thereof with the believing that the customer can evaluate properly monitor the trading of the Secretary, Securities and Exchange the special characteristics of, and is able Notes. Specifically, NASD will rely on Commission, 450 Fifth Street, NW., to bear the financial risks of, such its current surveillance procedures Washington, DC 20549–0609. Copies of transaction. governing equity securities, and will the submission, all subsequent The Notes will be subject to Nasdaq’s include additional monitoring on key amendments, all written statements continued listing criterion for other pricing dates. In addition, Nasdaq has a with respect to the proposed rule securities pursuant to NASD Rule general policy that prohibits the 4450(c). Under this criterion, the change that are filed with the distribution of material, non-public Commission, and all written aggregate market value or principal information by it employees. amount of publicly-held units must be communications relating to the at least $1 million. The Notes also must Disclosure and Dissemination of proposed rule change between the have at least two registered and active Information Commission and any person, other than market makers as required by NASD those that may be withheld from the Rule 4450(a)(6). Nasdaq will also Merrill Lynch will deliver a public in accordance with the consider prohibiting the continued prospectus in connection with the provisions of 5 U.S.C. 552, will be listing of the Notes if Merrill Lynch is initial purchase of the Notes. The available for inspection and copying in not able to meet its obligations on the procedure for the delivery of a the Commission’s Public Reference Notes. prospectus will be the same as Merrill Room. Copies of such filing will also be Lynch’s current procedure involving available for inspection and copying at Rules Applicable to the Trading of the primary offerings. In addition, Nasdaq the principal office of the NASD. All Notes will issue a circular to NASD members submissions should refer to file number Since the Notes will be deemed equity explaining the unique characteristics SR–NASD–2003–22 and should be securities for the purpose of NASD Rule and risks of the Notes. submitted by April 3, 2003. 4420(f), the NASD and Nasdaq’s existing 2. Statutory Basis IV. Commission’s Findings and Order equity trading rules will apply to the Granting Accelerated Approval of Notes. First, pursuant to NASD Rule Nasdaq believes that the proposed Proposed Rule Change 2310, ‘‘Recommendations to Customers rule change is consistent with the Nasdaq has asked the Commission to (Suitability),’’ and NASD IM–2310–2, provisions of section 15A of the Act,11 ‘‘Fair Dealing with Customers,’’ NASD approve the proposal, on an accelerated in general, and with section 15A(b)(6) of members must have reasonable grounds basis to accommodate the timetable for the Act,12 in particular, in that the for believing that a recommendation to listing the Notes. The Commission notes a customer regarding the purchase, sale proposal is designed to prevent that it has previously approved the or exchange of any security is suitable fraudulent and manipulative acts and listing of options on, and securities the for such customer upon the basis of the practices, to promote just and equitable performance of which have been linked 13 facts, if any, disclosed by such customer principles of trade, to remove to or based on, the S&P 500 Index. The as to his other security holdings and as impediments to and perfect the Commission has also previously to his financial situation and needs.10 In mechanism of a free and open market approved the listing of securities with a and, in general, to protect investors and structure identical to that of the Notes.14 9 NASD Rule 4420(f)(2) generally requires that the public interest. After care consideration, the issuers of securities designated pursuant to this Commission finds that the proposed paragraph [sic] to be listed on The Nasdaq National B. Self-Regulatory Organization’s rule change is consistent with the Market or the NYSE or be an affiliate of a company Statement on Burden on Competition listed on The Nasdaq National Market or the NYSE; requirements of the Act and the rules provided, however, that the provisions of NASD Nasdaq does not believe that the and regulations thereunder, applicable Rule 4450 will be applied to sovereign issuers of proposed rule change will result in any to a national securities association, and, ‘‘other’’ securities on a case-by-case basis. The in particular, with the requirements of Commission notes that there is a typographical burden on competition that is not error in NASD Rule 4420(f)(2), which the NASD, necessary or appropriate in furtherance 13 through its subsidiary, Nasdaq, will have to submit of the purposes of the Act. See note 7, supra. a filing, pursuant to the provisions of section 19(b) 14 See Securities Exchange Act Release Nos. under the Act, to delete any reference to paragraph 47009 (December 16, 2002), 67 FR 78540 (December (e) under this Rule. reasonable by such member or registered 24, 2002) (approving the listing and trading of 10 NASD Rule 2310(b) requires members to make Market Recovery Notes linked to the Nasdaq–100 representative in making recommendations to the reasonable efforts to obtain information concerning Index); and 46883 (November 21, 2002), 67 FR customer. a customer’s financial status, a customer’s tax 71216 (November 29, 2002) (approving the listing status, the customer’s investment objectives, and 11 15 U.S.C. 78o–3. and trading of Market Recovery Notes linked to the such other information used or considered to be 12 15 U.S.C. 78o–3(6). Dow Jones Industrial Average).

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section 15A(b)(6) of the Act 15 in that it recommendations,19 and compliance Regulation’s surveillance procedures for is designed to promote just and requirements, noted above, the the Notes will be the same as its current equitable principles of trade, to remove Commission believes that Nasdaq has surveillance procedures for equity impediments to and perfect the adequately addressed the potential securities, and will include additional mechanism of a free and open market, problems that could arise from the monitoring on key pricing dates. and, in general, to protect investors and hybrid nature of the Notes. The Fourth, the Commission has a the public interest.16 The Commission Commission notes that Nasdaq will systemic concern that a broker-dealer, believes that the Notes will provide distribute a circular to its membership such as Merrill Lynch, or a subsidiary investors with a means to participate in that provides guidance regarding providing a hedge for the issuer will any percentage increase in the Index member firm compliance incur position exposure. However, as that exist at the maturity of the Notes, responsibilities and requirements, the Commission has concluded in subject to the Capped Value. including suitability recommendations, previous approval orders for the hybrid Specifically, as described more fully and highlights the special risks and instruments issued by broker-dealers, 22 above, if the value of the S&P 500 Index characteristics associated with the the Commission believes that this has increased, a beneficial owner will be Notes. Specifically, among other things, concern is minimal given the size of the entitled to receive at maturity a payment the circular will indicate that the Notes Notes issuance in relation to the net of the Notes based on triple the amount do not guarantee any return of principal worth of Merrill Lynch. of any percentage increase in the S&P at maturity, that the maximum return on Finally, the Commission believes that 500 Index, not to exceed the Capped the Notes is limited to $11.60 and $16 the listing and trading of the proposed Value. per unit,20 that the Notes will not pay Notes should not unduly impact the market for the securities underlying the The Notes are leveraged debts interest, and that the Notes will provide Index or raise manipulative concerns. In instruments whose price will be derived exposure in the Index. Distribution of approving the product, the Commission from and based upon the value of the the circular should help to ensure that recognizes that the S&P 500 Index is a Index. In addition, as discussed more only customers with an understanding capitalization-weighted index of 500 fully above, the Notes do not guarantee of the risks attendant to the trading of companies listed on Nasdaq, the NYSE any return of principal at maturity. the Notes and who are able to bear the financial risks associated with and the AMEX. The Commission notes Thus, if the S&P 500 Index has declined transactions in the Notes will trade the that the Index is determined, composed, at maturity, a beneficial owner may Notes. In addition, the Commission and calculated by Standard & Poor’s. As receive significantly less than the notes that Merrill Lynch will deliver a of January 31, 2003, the aggregate original public offering price of the prospectus in connection with the market value of the 500 companies Notes.17 Accordingly, the level of risk initial purchase of the Notes. included in the Index represented involved in the purchase or sale of the Second, the Commission notes that approximately 79% of the aggregate Notes is similar to the risk involved in the final rate of return on the Notes market value of stocks included in the the purchase or sale of traditional depends, in part, upon the individual Standard & Poor’s Stock Guidance common stock. Because the final rate of credit of the issuer, Merrill Lynch. To Database of domestic common stocks return on the Notes is derivatively some extent this credit risk is traded in the U.S., excluding American priced and based upon the performance minimized by the NASD’s listing depositary receipts, limited partnerships of an index of securities, because the standards in NASD Rule 4420(f), which and mutual funds. Standard & Poor’s Notes are debt instruments that do not provide that only issuers satisfying chooses companies for inclusion in the guarantee a return of principal, and substantial asset and equity Index with the aim of achieving a because investors’ potential return is requirements may issue these types of distribution by broad industry limited by the Capped Value, there are hybrid securities. In addition, the groupings that approximates the several issues regarding trading of this NASD’s hybrid listing standards further distribution of these groupings in the type of product. For the reasons require that the Notes have at least $4 common stock population of the discussed below, the Commission million in market value. Financial Standard & Poor’s Stock Guide believes that Nasdaq’s proposal information regarding Merrill Lynch, in Database. Furthermore, as of February adequately addresses the concerns addition to information concerning the 18, 2003, ten main groups of companies raised by this type of product. issuers of the securities comprising the comprise the Index with the percentage First, the Commission notes that the S&P 500 Index, will be publicly weight of the companies included in protections of NASD Rule 4420(f) were available.21 each group indicated in parentheses as designed to address the concerns Third, the Notes will be registered follows: Consumer Discretionary attendant to the trading of hybrid under section 12 of the Act. As noted (13.4%), Consumer Staples (9.4%), securities like the Notes.18 In particular, above, the NASD’s and Nasdaq’s by imposing the hybrid listing existing equity trading rules will apply 22 See, e.g., Securities Exchange Act Release Nos. standards, heightened suitability for to the Notes, which will be subject to 44913 (October 9, 2001), 66 FR 52469 (October 15, equity margin rules and will trade 2001) (order approving File No. SR–NASD–2001– 73) (approving the listing and trading of notes 15 during the regular equity trading hours 15 U.S.C. 78o–3(b)(6). issued by Morgan Stanley Dean Witter & Co. whose 16 In approving the proposed rule, the of 9:30 a.m. to 4 p.m. NASD return is based on the performance of the Index); Commission has considered the proposed rule’s 44483 (June 27, 2001), 66 FR 35677 (July 6, 2001) impact on efficiency, competition, and capital 19 As discussed above, Nasdaq will advise (order approving File No. SR–Amex–2001–40) formation. 15 U.S.C. 78c(f). members recommending a transaction in the Notes (approving the listing and trading of notes issued 17 Any amount the beneficial owner would to: (1) Determine that the transaction is suitable for by Merrill Lynch whose return is based on a receive at maturity (which is less than the original the customer; and (2) have a reasonable basis for portfolio of 20 securities selected from the Amex offering price) would correspond to any decline in believing that the customer can evaluate the special Institutional Index); and 37744 (September 27, value of the S&P 500. Telephone conversation characteristics of, and is able to bear the financial 1996), 61 FR 52480 (October 7, 1996) (order between John D. Nachmann, Senior Attorney, risks of, the transaction. approving File No. SR–Amex–96–27) (approving Nasdaq, and Florence E. Harmon, Senior Special 20 The actual Capped Value will be determined at the listing and trading of notes issued by Merrill Counsel, Division of Market Regulation the time of issuance of the Notes. Lynch whose return is based on a weighted (‘‘Division’’), Commission, on March 7, 2003. 21 The companies comprising the Index are portfolio of healthcare/biotechnology industry 18 See 1993 Order, supra note 4. reporting companies under the Act. securities).

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Energy (6.0%), Financials (20.6%), For the Commission, by the Division of the proposal.5 This order approves the Health Care (15.3%), Industrials Market Regulation, pursuant to delegated amended proposal. (11.3%), Information Technology authority.27 Currently, NASD Conduct Rule 2260 requires members to forward proxy (14.4%), Materials (2.8%), Margaret H. McFarland, material, annual reports, information Telecommunication Services (4.0%), Deputy Secretary. and Utilities (2.8%). statements and other material sent to [FR Doc. 03–6071 Filed 3–12–03; 8:45 am] security holders to the beneficial owner Given the large diversification, BILLING CODE 8010–01–P or the beneficial owner’s ‘‘designated capitalization, and relative percentage investment adviser.’’ The rule defines a weightings of the companies included ‘‘designated investment adviser’’ as a in each group of companies comprising SECURITIES AND EXCHANGE person registered under the Investment the Index, the Commission continues to COMMISSION Advisers Act of 1940 (‘‘Advisers Act’’) believe, as it has concluded previously, who exercises investment discretion that the listing and trading of securities [Release No. 34–47459; File No. SR–NASD– pursuant to an advisory contract for the that are linked to the S&P 500 Index, 2002–124] beneficial owner and is designated in should not unduly impact the market writing by the beneficial owner to for the underlying securities comprising Self-Regulatory Organizations; Order receive proxy and related materials and the S&P 500 Index or raise manipulative Approving Proposed Rule Change, as vote the proxy, and to receive annual concerns.23 As discussed more fully Amended by Amendment No. 1 reports and other material sent to above, the Commission also believes Thereto, by the National Association of security holders. The NASD represents that the relative percentage weightings Securities Dealers, Inc. Relating to that when the National Securities of the ten groups of companies Proposed Amendment to NASD Markets Improvement Act was passed in comprising the Index should ensure that Conduct Rule 2260 To Expand the 1996, and certain state registered no one stock or group of stocks Definition of ‘‘Designated Investment investment advisers were no longer significantly minimize the potential for Adviser’’ To Include State Registered required to be registered under the manipulation of the Index. Moreover, Investment Advisers for the Purpose of Advisers Act, NASD Conduct Rule 2260 the issuers of the underlying securities Receiving and Voting Proxy Materials was not updated to account for this comprising the S&P 500 Index, are on Behalf of Beneficial Owners change. As a result, under the current subject to reporting requirements under rule, beneficial owners cannot designate March 6, 2003. state registered investment advisers to the Act, and all of the component stocks receive proxy and other materials. The are with listed on Nasdaq, the NYSE, or On September 19, 2002, the National Association of Securities Dealers, Inc. proposed rule change would expand the the Amex. In addition, Nasdaq’s definition of ‘‘designated investment surveillance procedures should serve to (‘‘NASD’’) filed with the Securities and Exchange Commission (‘‘Commission’’), adviser’’ to include persons registered deter as well as detect any potential pursuant to section 19(b)(1) of the by a state as an investment adviser. manipulation. Securities Exchange Act of 1934 The Commission finds that the The Commission finds good cause for (‘‘Act’’) 1 and rule 19b–4 thereunder,2 a proposed rule change, as amended, is approving the proposed rule change, as proposed rule change to amend NASD consistent with the requirements of the amended, prior to the thirtieth day after Conduct Rule 2260 to expand the Act and the rules and regulations the date of publication of notice of filing definition of ‘‘Designated Investment thereunder applicable to a national 6 thereof in the Federal Register. The Adviser’’ to include state registered securities association and, in Commission believes that the Notes will investment advisers for the purpose of particular, the requirements of section 7 provide investors with an additional receiving and voting proxy materials on 15A of the Act. The Commission finds investment choice and that accelerated behalf of beneficial owners. On January that the proposed rule change is approval of the proposal will allow 8, 2003, the NASD submitted consistent with section 15A(b)(6) of the 8 investors to begin trading the Notes Amendment No. 1 to the proposed rule Act, which requires, among other promptly. In addition, the Commission change.3 things, that the rules of a national securities association be designed to notes that it has previously approved The Commission published the promote just and equitable principles of the listing and trading of similar Notes proposed rule change, as amended, for trade and, in general, to protect and other hybrid securities based on the comment in the Federal Register on 24 investors and the public interest. The S&P 500 Index. Accordingly, the January 27, 2003.4 The Commission Commission believes that amending Commission believes that there is good received one comment letter relating to NASD Conduct Rule 2260 to expand the cause, consistent with sections definition of ‘‘designated investment 25 15A(b)(6) and 19(b)(2) of the Act, to 27 17 CFR 200.30–3(a)(12). adviser’’ to include persons registered approve the proposal, on an accelerated 1 15 U.S.C. 78s(b)(1). by a state as an investment adviser, basis. 2 17 CFR 240.19b–4. would allow for the reasonable 3 See letter from Kosha K. Dalal, Assistant General V. Conclusion Counsel, Regulatory Policy and Oversight, NASD, to Katherine England, Assistant Director, Division of 5 See letter from Christine A. Bruenn, NASSA It is therefore Ordered, pursuant to Market Regulation, Commission, dated January 8, President and Maine Securities Administrator, section 19(b)(2) of the Act,26 that the 2003 (‘‘Amendment No. 1’’). In Amendment No. 1, North American Securities Administrators the NASD proposed to (1) revise the first footnote Association, Inc. (‘‘NASAA’’), to Jonathan G. Katz, proposed rule change (SR–NASD–2003– of proposed NASD Conduct Rule 2260 to define the Secretary, Commission, dated February 18, 2003. In 22) is hereby approved on an term ‘‘state’’ by reference to the Investment its comment letter, the NASAA expressed support accelerated basis. Advisers Act of 1940, instead of the Securities for the proposal. See also infra note 9. Exchange Act of 1934, and (2) underline the text of 6 In approving this proposed rule change, the two proposed footnotes in proposed NASD Conduct Commission notes that it has considered the 23 See note 7, supra. Rule 2260 to indicate that they are proposed new proposed rule’s impact on efficiency, competition, 24 See note 13, supra. text. and capital formation. 15 U.S.C. 78c(f). 25 15 U.S.C. 78o–3(b)(6) and 78s(b)(2). 4 See Securities Exchange Act Release No. 47214 7 15 U.S.C. 78o–3. 26 15 U.S.C. 78s(b)(2). (January 17, 2003), 68 FR 3915. 8 15 U.S.C. 78o–3(b)(6).

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expectation that all registered advisers, SECURITIES AND EXCHANGE Committee for Review is the committee either state or federal, subject to due COMMISSION of the Board that reviews both disciplinary and delisting matters and, authorization and regulation, be [Release No. 34–47452; File No. SR–NYSE– permitted to receive and vote proxy 2001–27] according to the NYSE, it has often been materials on their behalf. The comprised of equal numbers of public Commission also believes that this Self-Regulatory Organizations; Order and industry directors. According to the change recognizes, and is consistent Approving Proposed Rule Change, as Exchange, in order to reconcile the with, the regulatory scheme set up for Amended by Amendment No. 1 majority of public Directors requirement the registration of investment advisors Thereto, by the New York Stock with the Committee’s traditional composition, and to allow all members under state and federal law pursuant to Exchange, Inc. Relating to of the Committee for Review present at Title III of the National Securities Amendments to Section 804 of the a meeting to participate in discussions, Markets Improvement Act of 1996 (the Listed Company Manual and Rule 499 9 of the Exchange the Committee required that the quorum ‘‘Coordination Act’’). for delisting matters include two public The rule will continue to require that March 6, 2003. directors and one industry director. a member that receives a written I. Introduction Consequently, a rotation system was designation from a beneficial owner established with respect to industry must ensure that the beneficial owner’s On August 17, 2001, the New York directors voting on delisting matters so Stock Exchange, Inc. (‘‘NYSE’’ or designated investment adviser is that those voting were comprised of a ‘‘Exchange’’) filed with the Securities registered under the Advisers Act or, for majority of public directors and at least and Exchange Commission state registered investment advisers, is one industry director.6 (‘‘Commission’’), pursuant to section The proposal amends section 804 of registered as an investment adviser 19(b)(1) of the Securities Exchange Act under the laws of the state. Members the Listed Company Manual to more of 1934 (‘‘Act’’),1 and Rule 19b–4 accurately describe the Exchange’s must also continue to ensure that the 2 thereunder, a proposed rule change to procedures. In addition, pursuant to the designated investment adviser is amend Section 804 of the Listed proposed rule change, the Chairman of exercising investment discretion Company Manual to specify that public the Committee would be required to pursuant to an advisory contract for the directors will constitute a majority of disclose to the issuer and the staff at the beneficial owner; and is designated in the directors of the Committee for commencement of each delisting writing by the beneficial owner to Review voting on final delisting hearing which of the industry directors receive and vote proxies for stock that determinations; and to codify this will be voting on the delisting matter. is in the possession of the members. change in the parallel Exchange Rule Furthermore, the decision relating to the Nasdaq rules would also require 499, as well as make other minor delisting appeal would be required to members to keep records substantiating conforming changes. On January 22, identify by name which directors this information. These requirements 2003, the NYSE filed Amendment No. 1 participated only and which directors should help to ensure that any state to the proposed rule change with the voted on the matter. The written 3 registered adviser is acting on behalf of Commission. decision issued by the Committee The Commission published the the beneficial owner. would also be required to clearly state proposed rule change, as amended, for that, in reaching its decision, the It is therefore ordered, pursuant to comment in the Federal Register on Committee considered only the oral section 19(b)(2) of the Act,10 that the 4 February 3, 2003. No comments were arguments, written briefs and proposed rule change (SR–NASD–2002– received on the proposal. This order accompanying materials presented by 124), as amended, is approved. approves the amended proposal. the parties at the time of the hearing. For the Commission, by the Division of II. Description of the Proposal The Exchange also proposes to codify Market Regulation, pursuant to delegated these changes in the parallel Exchange Section 804 of the Listed Company authority.11 Rule 499. Proposed NYSE Rule 499 also Manual describes the procedures to be reflects a previous amendment to Margaret H. McFarland, followed when the Exchange determines that a security should be removed from Deputy Secretary. 6 Pursuant to the rotation system, the Committee [FR Doc. 03–6074 Filed 3–12–03; 8:45 am] the list. It provides that the issuer has designates prior to each delisting hearing which a right to request a review of the industry director(s) shall vote. At all hearings, all BILLING CODE 8010–01–P Exchange’s determination by a public directors present shall vote. For example, at Committee of the Board of Directors of a Committee meeting attended by three (3) public directors and three (3) industry directors at which the Exchange, and currently specifies two delisting appeals are considered, all public that that committee is to be ‘‘comprised directors present and industry directors 1 and 2 will of a majority of public Directors.’’ This vote on the first delisting matter and all public requirement was added as part of a directors present and industry directors 3 and 1 will vote on the second delisting matter. If, on the larger revision of these procedures that Committee’s next review date, the meeting is became effective in 2000.5 The attended by two (2) public directors and three (3) 9 See NASAA Comment Letter, supra note 6. In industry directors and one delisting appeal is its comment letter, the NASAA stated that while 1 15 U.S.C. 78s(b)(1). considered, all public directors present and federal and state-registered advisers are industry director 2 will vote on the matter; industry 2 17 CFR 240.19b–4. distinguished based on their levels of assets under directors 1 and 3 will not vote. If any of the 3 management, both federal and state-registered See letter from Darla Stuckey, Corporate industry directors designated to vote next is not advisers generally perform similar functions. Secretary, NYSE, to Nancy Sanow, Assistant present at a Committee meeting, the next Director, Division of Market Regulation, According to the NASAA, while not all clients may succeeding industry director(s) will vote. The Commission, dated January 17, 2003 (‘‘Amendment rotation system is subject to the composition of the want their adviser to vote on their behalf, NASAA No. 1’’). believes this option should be available to all Committee, which varies at each meeting as 4 See Securities Exchange Act Release No. 47253 described above, depending upon each director’s investors. (January 24, 2003), 68 FR 5322. availability. As is the case with other procedures of 10 15 U.S.C. 78s(b)(2). 5 See Securities Exchange Act Release No. 42863 the Committee, the rotation system may also be 11 17 CFR 200.30–3(a)(12). (May 30, 2000), 65 FR 36488 (June 8, 2000). changed from time to time.

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section 804 of the Listed Company SECURITIES AND EXCHANGE order received via the SuperDOT Manual that was inadvertently not COMMISSION system. added to NYSE Rule 499. Under the current provisions of NYSE Rule 1000, if the published quotation in III. Discussion [Release No. 34–47463; File No. SR–NYSE– 2002–44] a stock is gapped for a brief period of The Commission finds that the time, usually with one side or both of Self-Regulatory Organizations; Order the quotation being set at 100 shares proposed rule change, as amended, is Approving Proposed Rule Change and because of an influx of orders on one consistent with the requirements of the Amendment No. 1 Thereto by the New side of the market, or if the bid and/or Act and the rules and regulations York Stock Exchange, Inc. Relating to offer size of the prevailing quotation is thereunder applicable to a national Amendments to the Exchange’s set at 100 shares, the Direct+ facility is 7 securities exchange. Specifically, the Automatic Execution Facility (NYSE not available. Under very active market Commission believes the proposal is Direct+) conditions, the specialist may quote 100 consistent with the section 6(b)(5) 8 shares bid or offered in order to allow requirements that the rules of an March 7, 2003. trades in the auction market to be exchange be designed to promote just On September 9, 2002, the New York consummated without the last sale price and equitable principles of trade, to Stock Exchange (‘‘NYSE’’ or being changed due to Direct+ remove impediments to and perfect the ‘‘Exchange’’) filed with the Securities executions. The Exchange has stated mechanism of a free and open market and Exchange Commission that this could result in the Exchange’s and a national market system, and in (‘‘Commission’’), pursuant to Section disseminated quotation temporarily not general, to protect investors and the 19(b)(1) of the Securities Exchange Act reflecting the actual depth of the market public interest. of 1934 (‘‘Act’’) 1 and Rule 19b–4 for a stock as reflected by the dynamics thereunder,2 a proposed rule change to The Commission believes that the of trading interest in the crowd. If the amend NYSE Direct+ Rule 1000. The Direct+ facility is not available in proposal provides fair procedures for Exchange submitted an amendment to issuers appealing delisting instances where the actual spread in a the proposed rule change on January 27, stock’s quotation is greater than five determinations by continuing to ensure 3 2003. On February 5, 2003, the rule cents, the specialist will be able to show that a majority of the members voting on proposal was published for comment in the actual depth in the market. a delisting matter will be public the Federal Register.4 The Commission According to the Exchange, if the actual directors and by clarifying that received no comments on the proposed spread resulting from bids and offers on decisions will be based on the record rule change. This order approves the the specialist’s book, or resulting from developed by the parties. The proposed rule change, as amended. trading crowd interest results in a Commission also believes that the I. Description of the Proposed Rule spread of less than five cents from the proposal should add greater Change price of the last trade, the specialist transparency to the process since the must display these, and Direct+ orders Chairman of the Committee would be The Exchange is proposing to amend will remain eligible for automatic required to disclose to the issuer and the its Direct+ pilot by amending NYSE execution. staff at the commencement of each Rule 1000. The NYSE Direct+ pilot The Exchange also proposes to amend 5 delisting hearing which of the industry expires on December 23, 2003. This Rule 1000(v) to provide that the directors will be voting on the delisting proposal would also expire with the specialist during the process for 6 matter. pilot. The NYSE proposes to amend completing a Rule 127 transaction NYSE Rule 1000(ii) to provide that should publish a bid and/or offer that is IV. Conclusion Direct+ executions will not be available more than five cents away from the last if the resulting trade would be more reported transaction price (instead of a It is therefore ordered, pursuant to than five cents from the last sale. This section 19(b)(2) of the Act,9 that the 100-share bid and/or offer) in the would apply to any trade whether an subject security on the Exchange. Any proposed rule change (SR–NYSE–2001– auto-ex trade or a trade in the regular limit order that is received as the Rule 27) is approved, as amended. auction market. Any auto-ex order sent 127 trade is being effected that would For the Commission, by the Division of that would result in an execution more better the market represented by the Market Regulation, pursuant to delegated than five cents away from the last trade broker’s bid or offer on behalf of the authority.10 would be routed to the specialist as a NYSE Rule 127 cross trade would be Margaret H. McFarland, SuperDOT limit order. The specialist included in the Rule 127 trade. would then represent that order as he or Deputy Secretary. she would represent any other limit II. Discussion [FR Doc. 03–5997 Filed 3–12–03; 8:45 am] After careful review, the Commission BILLING CODE 8010–01–P 1 15 U.S.C. 78s(b)(1). finds that the proposed rule change is 2 17 CFR 240.19b–4. consistent with the requirements of the 3 See Letter from Darla C. Stuckey, Corporate Act and the rules and regulations Secretary, NYSE, to Nancy J. Sanow, Assistant Director, Division of Market Regulation, thereunder applicable to a national Commission, dated January 23, 2003 (‘‘Amendment securities exchange.7 Specifically, the No. 1’’). Commission believes the proposed rule 4 See Securities Exchange Act Release No. 47285 change is consistent with Section 6(b)(5) 7 In approving this rule change, the Commission (January 29, 2003), 68 FR 5948. of the Act,8 which requires among other 5 has considered the proposed rule’s impact on See Securities Exchange Act Release No. 46906 things, that the rules of the Exchange are efficiency, competition, and capital formation. 15 (November 25, 2002), 67 FR 72260 (December 4, 2002). U.S.C. 78c(f). 6 Telephone call between Don Siemer, Director, 7 The Commission has considered the proposed 8 15 U.S.C. 78f(b)(5). Market Surveillance, NYSE, and Terri Evans, rule’s impact on efficiency, competition and capital 9 15 U.S.C. 78s(b)(2). Assistant Director, Division of Market Regulation, formation. 15 U.S.C. 78c(f). 10 17 CFR 200.30–3(a)(12). Commission (March 5, 2003). 8 15 U.S.C. 78f(b)(5).

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designed to prevent fraudulent and SECURITIES AND EXCHANGE SFCs and related positions at lower manipulative acts and practices, to COMMISSION levels than would be required if margined separately; (3) provide for a promote just and equitable principles of [Release No. 34–47460; File No. SR–NYSE– trade, to foster cooperation and 2003–05] Market Maker exclusion for proprietary coordination with persons engaged in trades of a Security Futures Dealer regulating, clearing, settling, processing Self-Regulatory Organizations; Notice (‘‘SFD’’) and allow for ‘‘good faith’’ information with respect to, and of Filing and Order Granting margin treatment for the accounts of facilitating transactions in securities, to Accelerated Approval of a Proposed approved options specialists, market remove impediments to and perfect the Rule Change by the New York Stock makers and other specialists; (4) provide definitions relative to SFCs for mechanism of a free and open market Exchange, Inc. To Adopt, on a application of this rule; (5) provide that and national market system, and, in Permanent Basis, Margin SFCs transacted in a futures account general, to protect investors and the Requirements for Security Futures Contracts shall not be subject to any provisions of public interest. Rule 431; (6) provide for money market The Commission believes that the March 6, 2003. mutual funds as defined under Rule 2a- proposed rule change should allow Pursuant to section 19(b)(1) of the 7 5 of the ICA,6 to be used to satisfy specialists to disseminate the actual Securities Exchange Act of 1934 margin requirements for SFCs provided depth of the NYSE auction market, (‘‘Act’’) 1 and Rule 19b-4 thereunder,2 certain conditions are met; (7) require while still ensuring that Direct+ is notice is hereby given that on March 5, that SFCs transacted in a securities available when there is sufficient 2003, the New York Stock Exchange, account be subject to all other liquidity at prices closely related to the Inc. (‘‘NYSE’’ or ‘‘Exchange’’) filed with provisions of NYSE Rule 431, last sale.9 The Commission also believes the Securities and Exchange particularly Rule 431(f)(8)(B) (‘‘Day that the proposed rule change should Commission (‘‘SEC’’ or the Trading’’); and (8) permit members and ‘‘Commission’’) the proposed rule continue to accommodate the crossing member organizations for which the change as described in Items I, II and III of block transactions outside the Exchange is the Designated Examining below, which Items have been prepared Authority (‘‘DEA’’) to participate in the prevailing quote, at the same time by the Exchange. The Commission is trading of SFCs. ensuring that limit orders that are publishing this notice to solicit Below is the text of the proposed rule received while the block trade is being comments on the proposed rule change change. Proposed new language is effected that improve the market from interested persons and to grant italicized; proposed deletions are in represented by the broker-dealer’s bid or accelerated approval of the proposed brackets. In addition, the table of offsets offer on behalf of the Rule 127 trade will rule change. is new rule language. be executed as part of the block * * * * * transaction. I. Self-Regulatory Organization’s Statement of the Terms of Substance of Rule 431 (‘‘Margin Requirements’’) III. Conclusion the Proposed Rule Change Rule 431. (a) For purposes of this It is therefore ordered, pursuant to This Exchange proposes to adopt, on Rule, the following terms shall have the Section 19(b)(2) of the Act,10 that the a permanent basis, the amendments to meanings specified below: proposed rule change (SR–NYSE–2002– NYSE Rule 431 relating to margin (1) The term ‘‘current market value’’ 44) is approved as part of the NYSE requirements for Security Futures means the total cost or net proceeds of Contracts (‘‘SFCs’’), which were a security on the day it was purchased Direct+ pilot that expires on December approved by the SEC on a pilot basis for or sold or at any other time the 23, 2003. sixty days (the ‘‘Pilot’’) on November 7, preceding business day’s closing price For the Commission, by the Division of 2002,3 and the Pilot was extended for an as shown by any regularly published Market Regulation, pursuant to delegated additional sixty days, from January 6, reporting or quotation service, except authority.11 2003 until March 6, 2003.4 for security futures contracts (see Margaret H. McFarland, The Exchange believes that the Section (f)(10)(C)(ii)). If there is no Deputy Secretary. proposed rule change would make its closing price, a member organization [FR Doc. 03–6070 Filed 3–12–03; 8:45 am] margin rule consistent with margin may use a reasonable estimate of the rules already adopted by the SEC and market value of the security as of the BILLING CODE 8010–01–P the Commodity Futures Trading close of business on the preceding Commission (‘‘CFTC’’) and those filed business day. by other self-regulatory organizations Rule 431 (a)(2) through (a)(3) (‘‘SROs’’) regarding security futures. unchanged. Specifically, the proposed (4) The term ‘‘equity’’ means the amendments would: (1) Permit customer’s ownership interest in the customer margining of SFCs, and account, computed by adding the establish initial and maintenance current market value of all securities margin requirements for SFCs; (2) allow ‘‘long’’ and the amount of any credit for initial and maintenance margin balance and subtracting the current levels for offsetting positions involving market value of all securities ‘‘short’’ and the amount of any debit balance. 1 15 U.S.C. 78s(b)(1). Any variation settlement received or 2 17 CFR 240.19b–4. paid on a security futures contract shall 3 See Securities Exchange Act Release No. 46782 9 According to the Exchange, a high percentage of be considered a credit or debit to the (November 7, 2002), 67 FR 69052 (November 14, executions in Direct+ occur within five cents of the 2002) (SR–NYSE–2002–53). account for purposes of equity. last sale. See Amendment No. 1, supra note 3. 4 See Securities Exchange Act Release No. 47129 10 Id. (January 3, 2003), 68 FR 2094 (January 15, 2003) 5 17 CFR 270.2a–7. 11 17 CFR 200.30–3(a)(12). (SR–NYSE–2003–01). 6 15 U.S.C. 80a et seq.

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(5) The term ‘‘exempted security’’ or Maintenance Margin (A) the account is recorded separately ‘‘exempted securities’’ has the meaning (c) The margin which must be and confined to the transactions and as in Section 3(a)(12) of the Securities maintained in all accounts of customers, relations specifically authorized by Exchange Act of 1934 (the ‘‘Exchange except for cash accounts subject to Regulation T of the Board of Governors Act’’ or ‘‘SEA’’). Regulation T unless a transaction in a of the Federal Reserve System; (6) The term ‘‘margin’’ means the cash account is subject to other (B) the account is not used in any way amount of equity to be maintained on a provisions of this rule, shall be as for the purpose of evading or security position held or carried in an follows: circumventing any regulation of the account. (1) 25% of the current market value of Exchange or of the Board of Governors (7) The term ‘‘person’’ has the all securities except for security futures of the Federal Reserve System and Rules meaning as in Section 3(a)(9) of the contracts, ‘‘long’’ in the account; plus 400 through 406 under the Exchange [Securities Exchange Act of 1934] (2) $2.50 per share or 100% of the Act and Rules 41.42 through 41.48 Exchange Act. current market value, whichever under the CEA; and (8) The term ‘‘basket’’ shall mean a amount is greater, of each stock ‘‘short’’ (C) the amount of any deficiency group of stocks that the Exchange or any in the account selling at less than $5.00 between the equity in the account and national securities exchange designates per share; plus the margin required by the other as eligible for execution in a single trade (3) $5.00 per share or 30% of the provisions of this Rule shall be through its trading facilities and that current market value, whichever deducted by computing the Net Capital consists of stocks whose inclusion and amount is greater, of each stock ‘‘short’’ of the member organization under the relative representation in the group are in the account selling at $5.00 per share Exchange’s Capital Requirements. (The determined by the inclusion and or above; plus term ‘‘nonpurpose credit’’ means an relative representation of their current (4) 5% of the principal amount or extension of credit other than ‘‘purpose market prices in a widely-disseminated 30% of the current market value, credit,’’ as defined in Section 220.2 of stock index reflecting the stock market whichever amount is greater, of each Regulation T of the Board of Governors as a whole. bond ‘‘short’’ in the account. of the Federal Reserve System.) Rule 431(e)(8) through (f)(9) Initial Margin (5) The minimum maintenance margin levels for security futures unchanged. (b) For the purpose of effecting new contracts, long and short, shall be 20% (f) securities transactions and of the current market value of such (10) Customer Margin Rules Relating commitments, the customer shall be contract. (See paragraph (f) of this Rule to Security Futures. required to deposit margin in cash and/ for other provisions pertaining to (A) Applicability. No member or or securities in the account which shall security futures contracts.) member organization may effect a be at least the greater of: Rule 431(d) through (e)(5) unchanged. transaction involving, or carry an (1) the amount specified in Regulation (e)(6)(A) Broker/Dealer Accounts.—A account containing, a security futures T of the Board of Governors of the member organization may carry the contract with or for a customer in a Federal Reserve System or Rules 400 proprietary account of another broker/ margin account, without obtaining through 406 of the Exchange Act or dealer, which is registered with the proper and adequate margin as set forth Rules 41.42 through 41.48 of The Securities and Exchange Commission, in this section. Commodity Exchange Act (‘‘CEA’’), or upon a margin basis which is (B) Amount of customer margin. (2) the amount specified in section (c) satisfactory to both parties, provided the (i) General Rule. As set forth in of this Rule, or requirements of Regulation T of the sections (b) and (c) of this Rule, the (3) such greater amount as the Board of Governors of the Federal minimum initial and maintenance Exchange may from time to time require Reserve System and Rules 400 through margin levels for each security futures for specific securities, or 406 under the Exchange Act and Rules contract, long and short, shall be twenty (4) equity of at least $2,000 except 41.42 through 41.48 under the CEA are (20) percent of the current market value that cash need not be deposited in adhered to and the account is not of such contract. excess of the cost of any security carried in a deficit equity condition. The (ii) Excluded from the rules’ purchased (this equity and cost of amount of any deficiency between the requirements are arrangements between purchase provision shall not apply to equity maintained in the account and a member or member organization and ‘‘when distributed’’ securities in a cash the haircut requirements pursuant to a customer with respect to the account). The minimum equity SEA Rule 15c3–1 (Net Capital) shall be customer’s financing of proprietary requirement for a ‘‘pattern day trader’’ is deducted in computing the Net Capital positions in security futures, based on $25,000 pursuant to paragraph of the member organization under the the member’s or member organization’s (f)(8)(B)(iv)(1) of this Rule. Withdrawals Exchange’s Capital Requirements. good faith determination that the of cash or securities may be made from However, when computing Net Capital customer is an ‘‘Exempted Person’’, as any account which has a debit balance, deductions for transactions in securities defined in Rule 401(a)(9) under the ‘‘short’’ position or commitments, covered by paragraphs (e)(2)(F) and Exchange Act, and Rule 41.43(a)(9) of provided it is in compliance with (e)(2)(G) of this Rule, the respective the CEA, except for the proprietary Regulation T of the Board of Governors requirements of those paragraphs may account of a broker-dealer carried by a of the Federal Reserve System and Rules be used, rather than the haircut member organization pursuant to 400 through 406 of the Exchange Act requirements of SEA Rule 15c3–1. Section (e)(6)(A) of this Rule. Once a and Rules 41.42 through 41.48 of the Rule 431(e)(6)(B) unchanged. registered broker or dealer, or member CEA and after such withdrawal the (e)(7) Nonpurpose Credit—In a of a national securities exchange ceases equity in the account is at least the nonsecurities credit account, a member to qualify as an exempted person, it greater of $2,000 ($25,000 in the case of organization may extend and maintain shall notify the member or member ‘‘pattern day traders’’) or an amount nonpurpose credit to or for any organization of this fact before sufficient to meet the maintenance customer without collateral or on any establishing any new security futures margin requirements of this Rule. collateral whatever, provided: positions. Any new security futures

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positions will be subject to the levels specified in paragraph (f)(10)(B)(i) maintenance margin levels (pursuant to provisions of this part. of this Rule, customers with offset the offset table below) that are lower (iii) Permissible Offsets.— positions involving security futures and than the levels specified in paragraph Notwithstanding the minimum margin related positions may have initial or (f)(10)(B)(i) of this Rule.

Security underlying Description of offset the security future Initial margin requirement Maintenance margin requirement

1. Long security future (or basket of Individual stock or nar- 20% of the current market value of The lower of: (1) 10% of the aggre- security futures representing each row-based security the long security future, plus pay gate exercise price of the put plus component of a narrow-based secu- index. for the long put in full. the aggregate put out-of-the-money rities index) and long put option on amount, if any; or (2) 20% of the the same underlying security (or current market value of the long se- index). curity future. 2. Short security future (or basket of Individual stock or nar- 20% of the current market value of 20% of the current market value of security futures representing each row-based security the short security future, plus the the short security future, plus the component of a narrow-based secu- index. aggregate put in-the-money aggregate put in-the-money rities index) and short put option on amount, if any. Proceeds from the amount, if any. the same underlying security (or put sale may be applied. index). 3. Long security future and Short posi- Individual stock or nar- The initial margin required under 5% of the current market value as de- tion in the same security (or securi- row-based security Regulation T for the short stock or fined in Regulation T of the stock ties basket) underlying the security index. stocks. or stocks underlying the security fu- future. ture. 4. Long security future (or basket of Individual stock or nar- 20% of the current market value of 20% of the current market value of security futures representing each row-based security the long security future, plus the the long security future, plus the component of a narrow-based secu- index. aggregate call in-the-money aggregate call in-the-money rities index) and short call option on amount, if any. Proceeds from the amount, if any. the same underlying security (or call sale may be applied. index). 5. Long a basket of narrow-based se- Narrow-based security 20% of the current market value of 20% of the current market value of curity futures that together tracks a index. the long basket of narrow-based the long basket of narrow-based broad based index and short a security futures, plus the aggregate security futures, plus the aggregate broad-based security index call op- call in-the-money amount, if any. call in-the-money amount, if any. tion contract on the same index. Proceeds from the call sale may be applied. 6. Short a basket of narrow-based se- Narrow-based security 20% of the current market value of 20% of the current market value of curity futures that together tracks a index. the short basket of narrow-based the short basket of narrow-based broad-based security index and short security futures, plus the aggregate security futures, plus the aggregate a broad-based security index put op- put in-the-money amount, if any put in-the-money amount, if any. tion contract on the same index. Proceeds from the put sale may be applied. 7. Long a basket of narrow-based se- Narrow-based security 20% of the current market value of The lower of: (1) 10% of the aggre- curity futures that together tracks a index. the long basket of narrow-based gate exercise price of the put, plus broad-based security index and long security futures, plus pay for the the aggregate put out-of-the-money a broad-based security index put op- long put in full. amount, if any; or (2) 20% of the tion contract the same index. current market value of the long basket of security futures. 8. Short a basket of narrow-based se- Narrow-based security 20% of the current market value of The lower of: (1) 10% of the aggre- curity futures that together tracks a index. the short basket of narrow-based gate exercise price of the call, plus broad-based security index and long security futures, plus pay for the the aggregate call out-of-the-money a broad-based security index call op- long call in full. amount, if any: or (2) 20% of the tion contract on the same index. current market value of the short basket of security futures. 9. Long security future and short secu- Individual stock or nar- The greater of: (1) 5% of the current The greater of: 5% of the current rity future on the same underlying row-based security market value of the long security market value of the long security security (or index). index. future; or (2) 5% of the current future; or (2) 5% of the current market value of the short security market value of the short security future. future. 10. Long security future, long put op- Individual stock or nar- 20% of the current market value of 10% of the aggregate exercise price, tion and short call option. The long row-based security the long security future, plus the plus the aggregate call in-the- security future, long put and short index. aggregate call in-the-money money amount, if any. call must be on the same underlying amount, if any, plus pay for the put security and the put and call must in full. Proceeds from the call sale have the same exercise price. (Con- may be applied. version). 11. Long security future, long put op- Individual stock or nar- 20% of the current market value of The lower of: (1) 10% of the aggre- tion and short call option. The long row-based security the long security future, plus the gate exercise price of the put plus security future, long put and short index. aggregate call in-the-money the aggregate put out-of-the-money call must be on the same underlying amount, if any, plus pay for the put amount, if any; or (2) 20% of the security and the put exercise price in full. Proceeds from call sale may aggregate exercise price of the call, must be below the call exercise price be applied. plus the aggregate call in-the- (Collar). money amount, if any.

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Security underlying Description of offset the security future Initial margin requirement Maintenance margin requirement

12. Short security future and long posi- Individual stock or nar- The initial margin required under 5% of the current market value, as tion in the same security (or securi- row-based security Regulation T for the long security defined in Regulation T, of the long ties basket) underlying the security index. or securities. stock or stocks. future. 13. Short security future and long posi- Individual stock or nar- The initial margin required under 10% of the current market value, as tion in a security immediately con- row-based security Regulation T for the long security defined in Regulation T, of the long vertible into the same security under- index. or securities. stock or stocks. lying the security future, without re- striction, including the payment of money. 14. Short security future (or basket of Individual stock or nar- 20% of the current market value of The lower of: (1) 10% of the aggre- security futures representing each row-based security the short security future, plus pay gate exercise price of the call, plus component of a narrow-based secu- index. for the call in full. the aggregate call out-of-the-money rities index) and Long call option or amount, if any; or (2) 20% of the warrant on the same underlying se- current market value of the short curity (or index). security future. 15. Short security future, short put op- Individual stock or nar- 20% of the current market value of 10% of the aggregate exercise price, tion and long call option. The short row-based security the short security future, plus the plus the aggregate put in-the- security future, short put and long index. aggregate put in-the-money money amount, if any. call must be on the same underlying amount, if any, plus pay for the call security and the put and call must in full. Proceeds from put sale may have the same exercise price. (Re- be applied. verse Conversion). 16. Long (short) a security future and Individual stock and The greater of: (1) 3% of the current The greater of: (1) 3% of the current short (long) an identical security fu- narrow-based secu- market value of the long security market value of the short security ture traded on a different market. rity index. future(s); or (2) 3% of the current future(s); or (2) 3% of the current market value of the short security market value of the short security future(s). future(s). 17. Long (short) a basket of security Individual stock and The greater of: (1) 5% of the current The greater of: (1) 5% of the current futures that together tracks a narrow- narrow-based secu- market value of the short security market value of the short security based index and short (long) a nar- rity index. future(s); or (2) 5% of the current future(s); or (2) 5% of the current row based index future. market value of the short security market value of the short security future(s). future(s). 7 Two security futures contracts will be considered ‘‘identical’’ for this purpose if they are issued by the same clearing agency or cleared and contracts guaranteed by the same derivatives clearing organization, have identical specifications, and would offset each other at the clearing level.

(C) Definitions. For the purposes of following conditions: (1) the quantity of (vi) The term ‘‘variation settlement’’ section (f)(10) of this Rule and the offset each underlying security is proportional has the same meaning as it is defined table noted above, with respect to the to its representation in the index, (2) the in Rule 401(a) of the Exchange Act and term ‘‘security futures contracts,’’ the total market value of the underlying Rule 41.43(a)(32) of the CEA. following terms shall have the meanings securities is equal to the aggregate value (D) Security Futures Dealers’ specified below: of the applicable index, (3) the basket Accounts. Notwithstanding the other (i) The term ‘‘security futures cannot be used to offset more than the provisions of this section (f)(10), a contract’’ means a ‘‘security future’’ as number of contracts or warrants member organization may carry and defined in Section 3(a)(55) of the represented by its total market value, clear the market maker permitted offset Exchange Act. and (4) the security futures contracts positions (as defined below) of one or (ii) The term ‘‘current market value’’ shall be unavailable to support any more security future dealers in an has the same meaning as it is as defined other contract or warrant transaction in account which is limited to market in Rule 401(4) under the Exchange Act the account. maker transactions, upon a ‘‘Good and Rule 41.43(a)(4) of the CEA. (v) The term ‘‘underlying stock Faith’’ margin basis which is (iii) The term ‘‘underlying security’’ basket’’ means a group of securities satisfactory to the concerned parties, means, in the case of physically settled which includes each of the component provided the ‘‘Good Faith’’ margin security futures contracts, the security securities of the applicable index and requirement is not less than the Net that is delivered upon expiration of the which meets the following conditions: Capital haircut deduction of the contract, and, in the case of cash settled (1) the quantity of each stock in the member organization carrying the security futures contracts, the security basket is proportional to its transaction pursuant to Rule 325. In lieu or securities index the price or level of representation in the index, (2) the total of collecting the ‘‘Good Faith’’ margin which determines the final settlement market value of the basket is equal to requirement, a carrying member price for the security futures contract the underlying index value of the index organization may elect to deduct in upon its expiration. options or warrants to be covered (3) the computing its Net Capital the amount of (iv) The term ‘‘underlying basket’’ securities in the basket cannot be used any deficiency between the equity means, in the case of a securities index, to cover more than the number of index maintained in the account and the a group of security futures contracts options or warrants represented by that ‘‘Good Faith’’ margin required. where the underlying securities as value, and (4) the securities in the For the purpose of this paragraph defined in paragraph (iii) above include basket shall be unavailable to support (f)(10)(D), the term ‘‘security futures each of the component securities of the any other option or warrant transaction dealer’’ means (1) a member or member applicable index and which meets the in the account. organization of a national securities

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exchange or a national securities (v) A net long position in a security option position or delivery in respect of association registered pursuant to futures contract in which a security a short security futures contract; Section 15A(a) of the Exchange Act; (2) futures dealer makes a market or the (iv) A stock position resulting from the is registered with such exchange or such underlying asset; exercise of a market maker long option association as a security futures dealer (vi) A net short position in a security position or taking delivery in respect of pursuant to rules that are effective in future contract in which a security a long security futures contract; accordance with Section 19(b)(2) of the futures dealer makes a market or the (v) A net long position in a security Exchange Act and, as applicable, underlying asset; or (other than an option) in which a Section 5c(c) of the CEA, that: (1) (vii) An offset position as defined in market maker makes a market; requires such member or member SEA Rule 15c3–1, including its (vi) A net short position in a security organization to be registered as a floor appendices, or any applicable SEC staff (other than an option) in which the trader or a floor broker with the CFTC interpretation or no-action position. market maker makes a market; or (vii) An offset position as defined in under Section 4f(a)(1) of the CEA, or as (E) Approved Options Specialists’ or SEC Rule 15c3–1, including the a dealer with the Commission under Market Makers’ Accounts. appendices, or any applicable SEC staff Section 15(b) of the Exchange Act; (2) or Notwithstanding the other provisions of requires such member or member interpretation or no-action position. (f)(10) and (f)(2)(j), a member For purposes of paragraphs (f)(10)(D) organization to maintain records organization may carry and clear the sufficient to prove compliance with the and (E), the term ‘‘in or at the money’’ market maker permitted offset positions means the current market price of the rules of the exchange or association of (as defined below) of one or more which it is a member; (3) requires such underlying security is not more than the approved options specialists or market two standard exercise intervals below member or member organization to hold makers in an account which is limited itself out as being willing to buy and sell (with respect to a call option) or above to approved options specialist or market (with respect to a put option) the security futures for its own account on maker transactions, upon a ‘‘Good a regular and continuous basis; and (4) exercise price of the option; the term ‘‘in Faith’’ margin basis which is the money’’ means the current market provides for disciplinary action, satisfactory to the concerned parties, including revocation of such member’s price of the underlying asset or index is provided the ‘‘Good Faith’’ margin not below (with respect to a call option) or member organization’s registration as requirement is not less than the Net a security futures dealer, for such or above (with respect to a put option) Capital haircut deduction of the the exercise price of the option; and the member’s or member organization’s member organization carrying the failure to comply with Rules 400 term ‘‘overlying option’’ means a put transaction pursuant to Rule 325. In lieu option purchased or a call option through 406 of the Exchange Act and of collecting the ‘‘Good Faith’’ margin Rules 41.42 through 41.49 of the CEA or written against a long position in an requirement, a carrying member underlying asset; or a call option the rules of the exchange or association organization may elect to deduct in of which the security futures dealer is a purchased or a put option written computing its Net Capital the amount of against a short position in an underlying member or member organization. any deficiency between the equity For purposes of this paragraph asset. maintained in the account and the (f)(10)(D), a permitted offset position Securities, including options and ‘‘Good Faith’’ margin required. For the means in the case of a security futures security futures contracts, in such purpose of this paragraph (f)(10)(E), the contract in which a security futures accounts shall be valued conservatively term ‘‘approved options specialist or dealer makes a market, a position in the in the light of current market prices and underlying asset or other related assets, market maker’’ means a specialist, the amount which might be realized or positions in options overlying the market maker, or registered trader in upon liquidation. Substantial additional asset or other related assets. options as referenced in paragraph margin must be required or excess Net Accordingly, a security futures dealer (f)(2)(j) of this Rule, who is deemed a Capital maintained in all cases where may establish a long or short position in specialist for all purposes under the the securities carried: (i) Are subject to the assets underlying the security Exchange Act and who is registered unusually rapid or violent changes in futures contracts in which the security pursuant to the rules of a national value including volatility in the futures dealer makes a market, and may securities exchange. expiration months of options or security purchase or write options overlying For purposes of this paragraph futures products, (ii) do not have an those assets, if the account holds the (f)(10)(E), a permitted offset position active market, or (iii) in one or more or following permitted offset positions: means a position in the underlying asset all accounts, including proprietary (i) A long position in the security or other related assets. Accordingly, a accounts combined, are such that they futures contract or underlying asset specialist or market maker may cannot be liquidated promptly or offset by a short option position which establish a long or short position in the represent undue concentration of risk in is ‘‘in or at the money;’’ assets underlying the options in which view of the carrying member or member (ii) A short position in the security the specialist or market maker makes a organization’s Net Capital and its futures contract or underlying asset market, or a security futures contract overall exposure to material loss. offset by a long option position which is thereon, if the account holds the (F) Approved Specialists’ Accounts— ‘‘in or at the money;’’ following permitted offset positions: others. Notwithstanding the other (iii) A position in the underlying asset (i) A long position in the underlying provisions of (f)(10) and (f)(2)(j), a resulting from the assignment of a instrument or security futures contract member organization may carry the market-maker short option position or offset by a short option position which account of an ‘‘approved specialist,’’ making delivery in respect of a short is ‘‘in or at the money;’’ which account is limited to specialist security futures contract; (ii) A short position in the underlying transactions including hedge (iv) A position in the underlying asset instrument or security futures contracts transactions with security futures resulting from the assignment of a offset by a long option position which is contracts upon a margin basis which is market-maker long option position or ‘‘in or at the money;’’ satisfactory to both parties. The amount taking delivery in respect of a long (iii) A stock position resulting from of any deficiency between the equity in security futures contract; the assignment of a market maker short the account and haircut requirements

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pursuant to SEA Rule 15c3–1 (Net change to amend NYSE Rule 431 was markets trading security futures Capital) shall be deducted in computing approved by the Commission on a pilot products; (2) they must prevent the Net Capital of the member basis for sixty days on November 7, systemic risk; (3) they must (a) be organization under the Exchange’s 2002.8 On January 6, 2003, the consistent with the margin requirements Capital Requirements. For purposes of Commission approved an extension to for comparable options traded on an this paragraph (f)(10)(F) the term the Pilot for an additional sixty days, exchange registered pursuant to section ‘‘approved specialist’’ means a ending March 6, 2003.9 6(a) of the Exchange Act,15 and (b) specialist who is deemed a specialist for The proposed amendments are being provide for initial and maintenance all purposes under the Exchange Act made to make the Exchange’s margin margin that are not lower than the and who is registered pursuant to the rule consistent with margin rules lowest level of margin, exclusive of rules of a national securities exchange. already adopted by the SEC and the premium, required for comparable .70 Money market mutual funds, as CFTC and those filed by other SROs exchange traded options; and (4) they defined under Rule 2a-7 of the regarding security futures. must be and remain consistent with the Investment Company Act of 1940, can Specifically, the proposed margin requirements established by the be used for satisfying margin amendments would: (1) Permit FRB under Regulation T.16 The requirements under this subsection customer margining of SFCs, and regulations on customer margin for (f)(10), provided that the requirements establish initial and maintenance security futures became effective on of Rule 404(b) of the Exchange Act and margin requirements for SFCs; (2) allow September 13, 2002. Pursuant to these Rule 46(b)(2) under the CEA are for initial and maintenance margin amendments the Exchange filed satisfied. levels for offsetting positions involving proposed amendments to NYSE Rule .80 Day-trading of security futures is SFCs and related positions at lower 431, which were approved temporarily subject to the minimum requirements of levels than would be required if on a pilot basis by the Commission. this Rule. If deemed a pattern day- margined separately; (3) provide for a Specifically, on October 23, 2002, the trader, the customer must maintain Market Maker exclusion for proprietary Exchange filed a proposed rule change equity of $25,000. The 20% trades of a SFD and allow for ‘‘good with the Commission to amend NYSE requirement, for security futures faith’’ margin treatment for the accounts Rule 431 with regard to SFCs.17 On contracts, should be calculated based of approved options specialists, market November 6, 2002, the Exchange filed on the greater of the initial or closing makers and other specialists; (4) provide Amendment No. 1 to the proposed rule transaction and any amount exceeding definitions relative to SFCs for change.18 The proposed rule change was NYSE excess must be collected. The application of this rule; (5) provide that approved by the Commission as a sixty- creation of a customer call subjects the SFCs transacted in a futures account day pilot on November 7, 2002,19 account to all the restrictions contained shall not be subject to any provisions of effective through January 6, 2003 in Rule 431(f)(8)(B). NYSE Rule 431; (6) provide for money (‘‘Pilot’’). .90 The use of the ‘‘time and tick’’ market mutual funds, as defined under Among the amendments approved, as 10 method is based on the member’s or Rule 2a–7 of the Investment Company part of the Pilot, was new NYSE Rule 11 member organization’s ability to Act of 1940, to be used to satisfy 431(f)(10) (‘‘Customer Margin Rules substantiate the validity of the system margin requirements for SFCs provided Relating to Security Futures’’), which used. Lacking this ability dictates the certain conditions are met; (7) require provides that SFCs transacted in a use of the aggregate method. that SFCs transacted in a securities securities account be subject to all other .100 Security futures contracts account be subject to all other provisions of NYSE Rule 431, including transacted or held in a futures account provisions of NYSE Rule 431, Rule 431(f)(8)(B) (‘‘Day Trading’’). shall not be subject to any provision of particularly Rule 431(f)(8)(B) (‘‘Day Also approved as part of the Pilot this Rule. Trading’’); and (8) permit members and were NYSE Rule 431(f)(10)(D) member organizations for which the (‘‘Security Futures Dealers’’ Accounts’’), * * * * * Exchange is the DEA to participate in Rule 431(f)(10)(E) (‘‘Approved Options II. Self-Regulatory Organization’s the trading of SFCs. Specialists’ or Market Makers’ Accounts’’), and Rule 431(f)(D)(F) Statement of the Purpose of, and Background Statutory Basis for, the Proposed Rule (‘‘Approved Specialists’’ Accounts- Change The CFTC and SEC have adopted others’’). The rule permits ‘‘good faith’’ customer margin requirements for the margin treatment for specified hedged In its filing with the Commission, the trading of SFCs (‘‘SEC/CFTC Margin offset positions carried in the accounts Exchange included statements Regulations’’)12 pursuant to authority noted above. However, unlike the SFD concerning the purpose of, and basis for, delegated to them by the Federal rules of other SROs,20 the Exchange’s the proposed rule change and discussed Reserve Board (‘‘FRB’’) under section any comments it received on the 7(c)(2)(B) of the Act.13 As noted in the 15 15 U.S.C. 78f. proposed rule change. The text of these adopting release,14 new subsection (2) to 16 12 CFR part 220. statements may be examined at the section 7(c) provides that the customer 17 See SR–NYSE–2002–53. places specified in Item IV below and is margin requirements for SFCs must 18 See letter from Darla C. Stuckey, Corporate set forth in Sections A, B, and C below. Secretary, NYSE, to Nancy Sanow, Assistant satisfy four requirements: (1) They must Director, Division, Commission, dated November 5, A. Self-Regulatory Organization’s preserve the financial integrity of 2002 (‘‘Amendment No. 1’’). Amendment No. 1 Statement of the Purpose of, and replaced the original rule filing in its entirety (SR– NYSE–2002–53). Amendment No. 1 also proposed Statutory Basis for, the Proposed Rule 8 See supra note 3. 9 that the proposal be effective for a sixty-day pilot Change See supra note 4. and requested accelerated approval of the proposed 10 17 CFR 270.2a–7. rule change. 1. Purpose 11 15 U.S.C. 80a et seq. 19 See Securities Exchange Act Release No. 46782 12 The Exchange proposes to make 17 CFR 240.400 through 406; 17 CFR 41.41 (November 7, 2002), 67 FR 69052 (November 14, through 41.48. 2002) (SR–NYSE–2002–53). permanent the amendments to NYSE 13 15 U.S.C. 78g(c)(2)(B). 20 See e.g., Securities Exchange Act Release No. Rule 431 regarding margin requirements 14 See Securities Exchange Act Release No. 46292 46555 (September 26, 2002), 67 FR 61707 (October for SFCs. The original proposed rule (August 1, 2002), 67 FR 53146 (August 14, 2002). 1, 2002) (SR–OC–2002–01).

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Pilot permitted member organizations to modifications from the Pilot based on Notwithstanding this amendment, the accord offset treatment in accounts the comments received and as discussed Exchange reiterates that good faith carried for such specialists, market below. margin treatment be permitted for makers and SFDs only when their In proposing its rule amendment on transactions effected by SFDs in activity is limited to bona fide specialist the application of day trading margin discharging their responsibilities and or market making transactions. The requirements to SFCs carried in obligations to maintain fair and orderly limitations imposed were consistent securities accounts, the Exchange did markets, and to provide liquidity to the with the Exchange’s belief that market not intend to create a regulatory marketplace. makers bear the primary responsibility disparity with other SROs’ rules. 2. Statutory Basis and obligation to maintain fair and However, the Exchange notes that an orderly markets, and provide liquidity SRO’s rules can be more stringent than The basis under the Exchange Act for to the marketplace. those of the Commission. In proposing this proposed rule change is section On January 3, 2003, the Exchange rules, the Exchange is guided by 6(b)(5) of the Act,25 which requires, filed a proposed rule change to extend Commission rules and has latitude to among other things, that an exchange the Pilot for an additional sixty days promulgate more stringent rules, which have rules that are designed to promote (from January 6, 2003 until March 6, it believes are necessary for the just and equitable principles of trade, to 2003) to allow the Pilot to continue in protection of investors. In this regard, remove impediments to, and perfect the effect on an uninterrupted basis and to NYSE believes that the application of mechanism of, a free and open market permit customers to continue trading the day trading margin requirements of and a national market system and, in SFCs in securities accounts while the NYSE Rule 431 as applied to SFCs general, to protect investors and the Exchange considered the comments carried in a securities account is public interest. The Exchange believes discussed below that it had received on consistent with the treatment of all that the proposed rule change is the Pilot.21 securities transacted in a margin designed to accomplish these goals by account under this rule. Accordingly, permitting customers to trade SFCs in Discussion of Comments Received the Exchange will propose to apply the securities accounts. On December 9, 2002, the Chicago day trading margin requirements to B. Self-Regulatory Organization’s Board Options Exchange, Incorporated SFCs carried in a securities account. Statement on Burden on Competition (‘‘CBOE’’) submitted a comment letter The CBOE also believes that the with regard to the Exchange’s margin Exchange should delete the term ‘‘bona The Exchange does not believe that rules for SFCs.22 In its letter, the CBOE fide’’ in connection with market maker the proposed rule change will impose requested that the Commission not grant or specialist transactions. CBOE any burden on competition that is not permanent approval of the amendments commented that the Exchange does not necessary or appropriate in furtherance to NYSE Rule 431 as proposed and define the term ‘‘bona fide’’ nor does it of the purposes of the Act. approved on a pilot basis, unless the use the term in relation to the other C. Self-Regulatory Organization’s Exchange amended the rule to exempt provisions of its margin rule relating to Statement on Comments on the SFCs from its day trading provisions market maker and specialist Proposed Rule Change Received From and deleted references to the term ‘‘bona transactions. Members, Participants or Others fide’’ in connection with market maker In response to CBOE’s comments, the or specialist transactions. Exchange is proposing to amend the The Exchange notes that it received In addition, as proposed, the rule text by deleting the term ‘‘bona written comments on the original Exchange’s day trading margin fide’’ in connection with specialist or proposed rule change that was filed requirements would apply to SFCs market maker transactions. In proposing with the Commission on October 23, carried in securities accounts. The such language under the pilot program, 2002, and thereafter amended on CBOE believed that day trading it was the Exchange’s intent to permit November 6, 2002. The Exchange has provisions should not apply to such good faith margin treatment for responded to such comments, and accounts because it would create a offsetting positions that were effected by hereby amends its proposed rule disparity that the CFMA was designed specialists or market makers in change, which was approved by the to eliminate. In this regard, CBOE’s discharging the primary responsibilities Commission as a pilot program. letter stated that the SEC and CFTC did noted above in its original filing, rather III. Solicitation of Comments not impose day trading margin than to permit persons other than Interested persons are invited to requirements to SFCs carried in futures qualified market makers to act in such submit written data, views and and securities accounts. Since similar a capacity—hence the term ‘‘bona fide’’ arguments concerning the foregoing, margin rules recently approved by the in connection with specialist and including whether the proposed rule Commission do not impose day trading market making transactions. Upon change is consistent with the Act. margin requirements on SFCs carried in consideration, and in order to be Persons making written submissions futures account, the CBOE stated that consistent with similar rules proposed should file six copies thereof with the permanent approval of the Exchange’s by other SROs,23 the Exchange will not Secretary, Securities and Exchange proposed rule would lead to a use the term ‘‘bona fide’’ in connection Commission, 450 Fifth Street NW., regulatory disparity the CFMA was with specialist and market making Washington, DC 20549–0609. Copies of designed to prevent. transactions and instead the Exchange the submission, all subsequent The Exchange is now seeking to proposes to incorporate the definition of amendments, all written statements adopt, on a permanent basis, margin a SFD in Exchange Act Rule with respect to the proposed rule requirements for SFCs carried in 400(c)(2)(v) 24 to clarify what constitutes change that are filed with the securities accounts, with proposed text a SFD for purpose of the rule. Commission, and all written communications relating to the 21 See supra note . 23 See e.g., Securities Exchange Act Release No. 22 See letter from Edward J. Joyce, President and 46711 (November 5, 2002), 67 FR 68710 (November proposed rule change between the Chief Operating Officer, CBOE, to Jonathan G. Katz, 12, 2002). Secretary, Commission, dated December 9, 2002. 24 17 CFR 240.400(c)(2)(v). 25 15 U.S.C. 78f(b)(5).

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Commission and any person, other than provides for a minimum margin level of those rules would also be consistent those that may be withheld from the 20% of current market value for all with NYSE Rule 431(f)(10)(D). public in accordance with the positions in security futures carried in Therefore, the Commission believes this provisions of 5 U.S.C. 552, will be a securities account. The Commission amendment should address the available for inspection and copying in believes that 20% is the minimum commenter’s concerns that NYSE not the Commission’s Public Reference margin level necessary to satisfy the impose a higher standard on Room. Copies of such filing will also be requirements of section 7(c)(2)(B) of the transactions by market maker and 30 available for inspection and copying at Act. Rule 403 under the Act also specialist registered pursuant to rules of the principal office of the NYSE. All provides that a national securities another SRO to qualify for favorable submissions should refer to File No. exchange may set margin levels lower margin treatment. SR–NYSE–2003–05 and should be than 20% of the current market value of submitted by April 3, 2003. the security future for an offsetting The Commission finds good cause for position involving security futures and approving the proposed rule change IV. Commission Findings and Order related positions, provided that an prior to the thirtieth day after the date Granting Accelerated Approval of a exchange’s margin levels for offsetting of publication of notice of filing thereof Proposed Rule Change positions meet the criteria set forth in in the Federal Register. The The NYSE has asked that the section 7(c)(2)(B) of the Act. The offsets Commission believes that accelerated Commission approve the proposed rule proposed by NYSE are consistent with approval of the proposed rule change change prior to the thirtieth day after the strategy-based offsets permitted for should enable NYSE members to publication of notice of the filing in the comparable offset positions involving continue to trade SFCs in securities Federal Register to accommodate the exchange-traded options and therefore accounts on an uninterrupted basis. In continuance of trading of security consistent with section 7(c)(2)(B) of the addition, the Commission believes that futures in securities accounts pursuant Act. granting accelerated approval to the to NYSE Rule 431 on an uninterrupted In addition, the Commission believes proposed rule change should clarify basis after the Pilot ends on March 6, it is consistent with the Act for the NYSE members’ obligations under 2003. The Commission finds that the NYSE to exclude from its margin proposed rule change is consistent with requirements positions in SFCs carried NYSE Rule 431 with respect to their the requirements of the Act and the in a futures account. The Commission trading in SFCs. The Commission notes rules and regulations thereunder believes that by choosing to exclude it approved NYSE’s original filing as a applicable to a national securities such positions from the scope of Rule temporary pilot to give members of the exchange.26 In particular, the 431, the NYSE’s proposal will make public an opportunity to comment on Commission believes that the proposed compliance by members with the the substance of the proposed rule rule change is consistent with the regulatory requirements of several SROs change before it requests permanent requirements of section 6(b)(5) of the easier. Moreover, as proposed, NYSE approval. The NYSE has responded to Act,27 which requires, among other member organizations will accord ‘‘good the comments received, as described things, that the rules of the Exchange be faith’’ margin treatment to specified above. Accordingly, the Commission designed to promote just and equitable offsetting positions involving security finds good cause, consistent with principles of trade and, in general, to futures, carried in a securities account section 19(b)(2) of the Act, to approve protect investors and the public for a SFD, consistent with the customer the proposed rule change prior to the 28 interest. In addition, the Commission margin rules for security futures thirtieth day after publication if the believes that the proposed rule change adopted by the Commission and the notice of filing. is consistent with section 7(c)(2)(B) of CFTC. the Act,29 which provides, among other After careful consideration of the V. Conclusion things, that the margin requirements for commenter’s concern about applying security futures must preserve the the NYSE’s day trading margin It is therefore ordered, pursuant to financial integrity of markets trading requirements to SFCs, the Commission section 19(b)(2) of the Act 31, that the security futures, prevent systemic risk, believes that it is reasonable for the proposed rule change (File No. SR– be consistent with the margin NYSE to impose day trading margin NYSE–2003–05) be approved. requirements for comparable exchange- requirements on its members with For the Commission, by the Division of traded options, and provide that the respect to SFCs carried in a securities Market Regulation, pursuant to delegated margin levels for security futures may account. As NYSE noted, an SRO may authority.32 be no lower than the lowest level of adopt more stringent requirements than Margaret H. McFarland, margin, exclusive of premium, required those promulgated by the Commission. for any comparable exchange-traded The Commission has also carefully Deputy Secretary. option. considered the commenter’s concern of [FR Doc. 03–6073 Filed 3–12–03; 8:45 am] The Commission believes that the rule using the term ‘‘bona fide’’ with respect BILLING CODE 8010–01–P change is generally consistent with the to market maker or specialist customer margin rules for security transactions. The Commission notes that futures adopted by the Commission and NYSE has deleted the term ‘‘bona fide’’ the CFTC. In particular, the Commission in reference to market maker or notes that, consistent with Rule 403 specialist transactions, and instead is under the Act, NYSE’s proposed rule incorporating the definition of an SFD in Rule 400(c)(2)(v) under the Act. The 26 15 U.S.C. 78s(b)(2). Commission believes that if it finds, in 27 15 U.S.C. 78f(b)(5). approving an SRO’s rules for SFDs, that 28 In approving the proposed rule, the such rules are consistent with the Commission has considered the proposed rule’s impact on efficiency, competition, and capital definition of SFD in Rule 400(c)(2)(v), formation. 15 U.S.C. 78c(f). 31 15 U.S.C. 78s(b)(2). 29 15 U.S.C. 78g(c)(2)(B). 30 17 CFR 240.403(b)(2). 32 17 CFR 200.30–3(a)(12).

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SECURITIES AND EXCHANGE to receive proxy material, other related permitted to receive and vote proxy COMMISSION issuer material and to vote proxies on materials on their behalf. The their behalf, if such investment advisers Commission also believes that this [Release No. 34–47458; File No. SR–NYSE– 2002–50] are registered under the Advisers Act, change recognizes, and is consistent exercise investment discretion pursuant with, the regulatory scheme set up for Self-Regulatory Organizations; Order to an advisory contract, and have been the registration of investment advisors Approving Proposed Rule Change, as designated to the member organization under state and federal law pursuant to Amended by Amendment No. 1 in writing by the beneficial owner. the Coordination Act.11 Thereto, by the New York Stock Title III of the National Securities NYSE’s rules will continue to require Exchange, Inc. To Adopt Amendments Markets Improvement Act of 1996 (the that such investment advisers are to Exchange Rules 450 (‘‘Restrictions ‘‘Coordination Act’’) reallocated exercising investment discretion on on Giving of Proxies’’), 451 regulatory responsibilities for behalf of the beneficial owner pursuant (‘‘Transmission of Proxy Material’’), investment advisers between the to an advisory contract, and have been 452 (‘‘Giving Proxies by Member Commission and the states.7 Generally, designated to the member organization Organizations’’), and 465 the Coordination Act provides for in writing by the beneficial owner. (‘‘Transmission of Interim Reports and Commission regulation of advisers with These requirements should help to Other Material’’) $25 million or more of assets under ensure that any state registered adviser management, and state regulation of is acting on behalf of the beneficial March 6, 2003. advisers with less than $25 million of owner. On October 16, 2002, the New York assets under management. As a result, It is therefore Ordered, pursuant to Stock Exchange, Inc. (‘‘NYSE’’ or the Exchange believes that the number section 19(b)(2) of the Act,12 that the ‘‘Exchange’’) filed with the Securities of advisers eligible to be registered with proposed rule change (SR–NYSE–2002– and Exchange Commission the Commission has been reduced by 50), as amended, is approved. (‘‘Commission’’), pursuant to section approximately two-thirds. 19(b)(1) of the Securities Exchange Act Consequently, because NYSE’s current For the Commission, by the Division of of 1934 (‘‘Act’’),1 and Rule 19b-4 Market Regulation, pursuant to delegated rules require the authorized investment authority.13 thereunder,2 a proposed rule change to adviser to be registered under the amend NYSE Rule 450 (‘‘Restriction on Advisers Act, beneficial owners cannot Margaret H. McFarland, Giving of Proxies’’), NYSE Rule 451 designate a large number of investment Deputy Secretary. (‘‘Transmission of Proxy Material’’), advisers (those with less than $25 [FR Doc. 03–6075 Filed 3–12–03; 8:45 am] NYSE Rule 452 (‘‘Giving Proxies by million under management) to exercise BILLING CODE 8010–01–P Member Organizations’’), and NYSE investment discretion pursuant to an Rule 465 (‘‘Transmission of Interim advisory contract, or to receive and vote Reports and Other Material’’) to allow proxy materials on their behalf. The SECURITIES AND EXCHANGE authorized state-registered investment proposed amendments would allow COMMISSION advisers to receive and vote proxy such authorization to be extended to materials on behalf of beneficial owners. advisers registered under state law. [Release No. 34–47453; File No. SR–PCX– On December 19, 2002, the NYSE The Commission finds that the 2003–07] amended the proposal to define the term proposed rule change, as amended, is ‘‘state’’ in proposed NYSE Rule 451 by consistent with the requirements of the Self-Regulatory Organizations; Notice reference to the Investment Advisers Act and the rules and regulations of Filing and Immediate Effectiveness Act of 1940 (‘‘Advisers Act’’),3 instead thereunder applicable to a national of Proposed Rule Change by the of the Act.4 securities exchange 8 and, in particular, Pacific Exchange, Inc. Relating to The Commission published the the requirements of section 6 of the Changes in Marketing Fees Charged to proposed rule change, as amended, for Act.9 The Commission finds that the Its Market Makers comment in the Federal Register on proposed rule change, as amended, is January 28, 2003.5 The Commission consistent with section 6(b)(5) of the March 6, 2003. received one comment letter relating to Act,10 which requires, among other Pursuant to section 19(b)(1) of the the proposal. 6 This order approves the things, that the rules of an exchange be Securities Exchange Act of 1934 amended proposal. designed to promote just and equitable (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 Currently, NYSE Rules 450, 451, 452, principles of trade and, in general, to notice is hereby given that on February and 465 provide beneficial owners the protect investors and the public interest. 24, 2003, the Pacific Exchange, Inc. ability to authorize investment advisors The Commission believes that amending (‘‘PCX’’) filed with the Securities and NYSE Rules 450, 451, 452, and 465 to Exchange Commission (‘‘Commission’’) 1 15 U.S.C. 78s(b)(1). allow authorized state-registered the proposed rule change as described 2 17 CFR 240.19b–4. advisers to receive and vote proxy in Items I, II, and III below, which Items 3 15 U.S.C. 80b. materials on behalf of the beneficial 4 See letter from Darla Stuckey, Corporate Secretary, NYSE, to Nancy Sanow, Assistant owner, would allow for the reasonable 11 See NASAA Comment Letter, supra note 6. In Director, Division of Market Regulation, expectation that all registered advisers, its comment letter, the NASAA stated that while Commission, dated December 19, 2002 state and federal, subject to due federal and state-registered advisers are distinguished based on their levels of assets under (‘‘Amendment No. 1’’). authorization and regulation, be 5 See Securities Exchange Act Release No. 47215 management, both federal and state-registered (January 17, 2003), 68 FR 4263. advisers generally perform similar functions. 7 According to the NASAA, while not all clients may 6 See letter from Christine A. Bruenn, NASSA 62 FR 28112 (May 22, 1997); Release No. IA– want their adviser to vote on their behalf, NASAA President and Maine Securities Administrator, 1633, File No. S7–31–96. 8 believes this option should be available to all North American Securities Administrators In approving this proposed rule change, the investors. Association, Inc. (‘‘NASAA’’), to Jonathan G. Katz, Commission notes that it has considered the 12 Secretary, Commission, dated February 18, 2003 proposed rule’s impact on efficiency, competition, 15 U.S.C. 78s(b)(2). (‘‘NASAA Comment Letter’’). In its comment letter, and capital formation. 15 U.S.C. 78c(f). 13 17 CFR 200.30’3(a)(12). the NASAA expressed support for the proposal. See 9 15 U.S.C. 78f. 1 15 U.S.C. 78s(b)(1). also infra note 11. 10 15 U.S.C. 78f(b)(5). 2 17 CFR 240.19b–4.

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have been prepared by the PCX.3 On marketing fees as set forth in its C. Self-Regulatory Organization’s February 28, 2003, PCX submitted Schedule of Marketing Charges. Statement on Comments on the Amendment No. 1 to the proposed rule The PCX is proposing to change the Proposed Rule Change Received From 4 change. The Commission is publishing marketing fee for certain options as set Members, Participants, or Others this notice to solicit comments on the forth in the Schedule of Marketing proposed rule change from interested PCX neither solicited nor received Charges beginning at the persons. written comments concerning the commencement of the March trade proposal. I. Self-Regulatory Organization’s month and continuing until further Statement of the Terms of Substance of notice. The PCX proposes to change III. Date of Effectiveness of the the Proposed Rule Change only the amounts of the fees that it Proposed Rule Change and Timing for The PCX is proposing to change its charges for transactions in the options Commission Action marketing fee for certain options and to that are included in the proposed Because the foregoing rule change adopt new marketing fees for recently Schedule of Marketing Charges.6 Any listed options. The text of the proposed fees currently being charged for establishes or changes a due, fee, or rule change is available at the principal transactions in options that are not other charge imposed by the PCX, it has offices of the PCX and at the listed in this amendment to the become effective pursuant to section 9 Commission. Schedule of Marketing Charges would 19(b)(3)(A) of the Act and Rule 19b– 10 not be affected by the proposed rule 4(f) thereunder. At any time within 60 II. Self-Regulatory Organization’s days after the filing of the proposed rule Statement of the Purpose of, and change. The PCX believes that its proposed rule change is reasonable and change, the Commission may summarily Statutory Basis for, the Proposed Rule abrogate the rule change if it appears to Change equitable because it is designed to enable the PCX to compete with other the Commission that such action is In its filing with the Commission, the markets in attracting options business. necessary or appropriate in the public PCX included statements concerning the interest, for the protection of investors, The PCX’s marketing fee program purpose of and basis for the proposed or otherwise in furtherance of the applies only to option issues classified rule change and discussed any purposes of the Act. For purposes of comments it had received on the by the PCX as a Top 250 issue. The PCX defines a Top 250 issue as one of the calculating the 60-day abrogation proposed rule change. The text of these period, the Commission considers the statements may be examined at the 250 most actively traded option issues on a national basis. For each current proposed rule change to have been filed places specified in Item IV below. The on February 28, 2003, the date PCX has prepared summaries, set forth month, the PCX’s determination of Amendment No. 1 was filed. in sections A, B, and C below, of the whether an equity option ranks in the most significant aspects of such top 250 most active issues will be based IV. Solicitation of Comments statements. on volume statistics for the three calendar months of trading activity Interested persons are invited to A. Self-Regulatory Organization’s beginning four months prior to the submit written data, views, and Statement of the Purpose of, and current month. arguments concerning the foregoing, Statutory Basis for, the Proposed Rule including whether the proposed rule Change 2. Statutory Basis change is consistent with the Act. 1. Purpose The PCX believes that its proposal to Persons making written submissions The PCX recently adopted a payment- amend its schedule of dues, fees and should file six copies thereof with the for-order-flow program under which it charges is consistent with Section 6(b) Secretary, Securities and Exchange charges a marketing fee ranging from $0 of the Act 7 in general, and furthers the Commission, 450 Fifth Street, NW., to $1.00 per contract on a per-issue objectives of Section 6(b)(4) of the Act 8 Washington, DC 20549–0609. Copies of basis.5 The PCX segregates the funds in particular, in that it is an equitable the submission, all subsequent from this fee by trading post and makes allocation of reasonable dues, fees, and amendments, all written statements the funds available to Lead Market other charges among PCX members. with respect to the proposed rule Makers (‘‘LMMs’’) for their use in change that are filed with the attracting orders in the options traded at B. Self-Regulatory Organization’s Commission, and all written the posts. The PCX charges the Statement on Burden on Competition communications relating to the The PCX does not believe that the proposed rule change between the 3 The Commission notes that in its cover letter Commission and any person, other than accompanying the proposed rule change, PCX proposed rule change will impose any inadvertently referred to the filing as SR–PCX– burden on competition that is not those that may be withheld from the 2003–06. necessary or appropriate in furtherance public in accordance with the 4 See letter from Mai S. Shiver, Senior Attorney, of the purposes of the Act. provisions of 5 U.S.C. 552, will be Regulatory Policy, PCX, to Nancy J. Sanow, available for inspection and copying at Assistant Director, Division of Market Regulation, Commission, dated February 28, 2003, received via 6 The Commission notes that the PCX payment- the Commission’s Public Reference facsimile on February 28, 2003. In Amendment No. for-order-flow program applies only to Top 250 Room. Copies of such filing also will be 1, the PCX clarified that the marketing fee program issues. For purposes of the payment-for-order-flow- available for inspection and copying at applies only to option issues classified by the PCX program, the PCX recalculates the Top 250 issues as among the Top 250 issues, and described how quarterly, based upon volume statistics for the the principal office of the PCX. All the Top 250 issues are determined. In addition, the three-month period that began four months earlier. submissions should refer to File No. PCX supplemented its Schedule of Marketing The PCX has updated its Schedule of Marketing SR–PCX–2003–07 and should be Charges to include a list of 19 options issues for Charges to identify the changes to the marketing submitted by April 3, 2003. which the marketing fee has been reduced from fees that the PCX is charging for the March, April, $0.50 to $0.00. and May 2003 trading months, as part of its 5 See Exchange Act Release No. 44830 (September payment-for-order-flow program. See Note 4 supra. 21, 2001), 66 FR 49728 (September 28, 2001) (SR– 7 15 U.S.C. 78f(b). 9 15 U.S.C. 78s(b)(3)(A). PCX–2001–37). 8 15 U.S.C. 78f(b)(4). 10 17 CFR 240.19b–4(f).

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For the Commission, by the Division of Rule 7—Equities Trading execution during the Market Order Market Regulation, pursuant to delegated Auction. authority.11 Orders and Modifiers (c)–(f)—No change. Margaret H. McFarland, Trading Sessions II. Self-Regulatory Organization’s Deputy Secretary. Rule 7.34(a)–(c)—No change. Statement of the Purpose of, and [FR Doc. 03–5996 Filed 3–12–03; 8:45 am] (d) Order Permitted in Each Session. Statutory Basis for, the Proposed Rule BILLING CODE 8010–01–P (1) During the Opening Session: Change (A)–(F)—No change. In its filing with the Commission, the (G) Limited Price Orders are eligible PCX included statements concerning the SECURITIES AND EXCHANGE for execution during the Opening purpose of and basis for the proposed COMMISSION Session; provided, however, a Timed rule change and discussed any Order designated for the Opening comments it had received. The text of [Release No. 34–47457; File No. SR–PCX– Session and designated as good from 5 these statements may be examined at 2003–10] am (Pacific Time) is not eligible for the places specified in Item IV below. execution during the Opening Auction. The PCX has prepared summaries, set Self-Regulatory Organizations; Notice Similarly, a Timed Order designated for forth in sections A, B, and C below, of of Filing and Immediate Effectiveness the Opening Session and designated as the most significant aspects of those of Proposed Rule Change by the good from 6:30 am (Pacific Time) is not statements. Pacific Exchange, Inc. Relating to the eligible for execution during the Market A. Self-Regulatory Organization’s Eligibility of Timed Orders During the Order Auction (H)—No change. Statement of the Purpose of, and Opening Auction and Market Order Statutory Basis for, the Proposed Rule Auction, Amending PCXE Rules 7.34 (2)–(3)—No change. (e)–(f)—No change. Change and 7.35 Opening Session Auctions 1. Purpose March 6, 2003. Rule 7.35(a) Order Entry and ArcaEx commenced operations on Pursuant to Section 19(b)(1) of the Cancellation Before Opening Auction March 22, 2002, replacing the PCXE’s Securities Exchange Act of 1934 (1)—No change. traditional trading floor facilities. As (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 (2) Only Limited Priced Orders part of its continuing review of the notice is hereby given that on March 3, designated for the Opening Session will system’s functionality and its duty to 2003, the Pacific Exchange, Inc. (‘‘PCX’’) be eligible for the Opening Auction. ensure the reporting of current, filed with the Securities and Exchange However, a Limited Price Order accurate, and consistent information Commission the proposed rule change designated for the Opening Session and regarding the Indicative Price Match 4 as described in Items I and II, below, entered as a Timed Order good from 5 and Imbalances 5 on ArcaEx, the PCXE which the PCX has prepared. The am (Pacific Time), is not eligible for proposes to amend its rule to exclude Commission is publishing this notice to execution during the Opening Auction. Timed Orders designated as good from solicit comments on the proposed rule Market orders entered before the 5 a.m. (Pacific Time) or 6:30 a.m. change from interested persons. Opening Auction or during the Opening (Pacific Time) from execution during Session will participate in the Market the Opening Auction and Market Order I. Self-Regulatory Organization’s Order Auction. However, a Limited Auction, respectively. Statement of the Terms of Substance of Price Order designated for the Opening ArcaEx operates three trading sessions the Proposed Rule Change Session and entered as a Timed Order each day the PCXE is open for 6 good from 6:30 am (Pacific Time), is not business. The proposed rule change The PCX, through its wholly owned eligible for execution during the Market concerns only the Opening Session. The subsidiary PCX Equities, Inc. (‘‘PCXE’’), Order Auction. Limited Price Orders, Opening Session begins at 5 a.m. proposes to amend its rules governing including Timed Orders, designated for (Pacific Time) and concludes at 6:30 the Archipelago Exchange (‘‘ArcaEx’’), the Core Trading Session and not a.m. (Pacific Time) with the the PCXE’s equities trading facility, by: designated for the Opening Session will (1) Amending PCXE Rule 7.34(d) to 4 PCXE Rule 1.1(r) provides, in part: ‘‘[f]or become eligible for execution at the purposes of the Opening Auction [and] the Market clarify that a specific type of Limited commencement of the Market Order Auction, as the case may be, * * * the term 3 Price Order; namely a Timed Order Auction pursuant to Rule 7.35(c). ‘‘Indicative Match Price’’ shall mean for each designated as good from 5 a.m. (Pacific (3)–(4)—No change. security (1) the price at which the maximum Time) or good from 6:30 a.m. (Pacific volume of shares are executable; or (2) if there are (b) Opening Auction. two or more prices at which the maximum volume Time), will be excluded from eligibility (1) At 5 am (Pacific Time), Limited of shares are executable, the price that is closest to for execution during the Opening Priced Orders designated for the the closing price of the previous day’s normal Auction and Market Order Auction, Opening Session are matched and market hours * * * as determined by the Consolidated Tape will establish the opening price, respectively; and (2) amending PCXE executed in the Opening Auction; provided that such price would trade through an Rule 7.35(a) through (c) to exclude provided, however, a Limited Price eligible Limited Price Order designated for such an specified Timed Orders during the Order designated for the Opening auction, then the opening price will occur at the applicable auctions. The text of the Session and entered as a Timed Order best price level available where no trade through good from 5 am (Pacific Time), is not occurs.’’ proposed rule change is below. New text 5 PCXE Rule 1.1(q) provides, in part: ‘‘[f]or is italicized. eligible for execution during the purposes of the Opening Auction [and] the Market Opening Auction. Auction * * * as the case may be, the term ‘‘Imbalance’’ shall mean the number of buy or sell 11 17 CFR 200.30–3(a)(12). (2)–(3)—No change. (4) A Limited Price Order designated shares that can not be matched with other shares 1 15 U.S.C. 78s(b)(1). at the Indicative Match Price at any given time.’’ 2 CFR 240.19b–4. for the Opening Session and entered as 6 The three trading sessions are (1) the Opening 3 See PCXE Rule 7.31(q) (definition of a ‘‘Timed a Timed Order good from 6:30 am session; (2) the Core Session; and (3) the Late Order’’). (Pacific Time) is not eligible for Trading Session. See PCXE Rule 7.34(a).

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commencement of the Core Trading III. Date of Effectiveness of the necessary or appropriate in the public Session. The Opening Session is Proposed Rule Change and Timing for interest, for the protection of investors, comprised of the Opening Auction and, Commission Action or otherwise in furtherance of the 7 thereafter, the Market Order Auction. The PCX submitted a draft of this purposes of the Act. Limited Price Orders are matched in the filing, including the proposed new rule IV. Solicitation of Comments Opening Auction or the Market Order text, to the Commission in fulfillment of Interested persons are invited to Auction and executed at the Indicative the five-day draft notice period of Rule submit written data, views and Match Price. 19b–4(f)(6).10 The PCX has further arguments concerning the foregoing, ArcaEx currently permits a Timed designated that the proposed rule including whether the proposal is Order designated as good from 5 a.m. change: (1) Does not significantly affect consistent with the Act. Persons making (Pacific Time) and designated for the the protection of investors or the public Opening Session to participate in the interest; (2) does not impose any written submissions should file six Opening Auction. Conversely, a Timed significant burden on competition; and copies thereof with the Secretary, Order designated as good from 6:30 a.m. (3) does not become operative for 30 Securities and Exchange Commission, (Pacific Time) and designated for the days from the date of filing, or such 450 Fifth Street, NW., Washington, DC Opening Session does not participate in shorter time as the Commission may 20549–0609. Copies of the submission, the Market Order Auction. The designated if consistent with the all subsequent amendments, all written proposed rule change is intended to protection of investors and the public statements with respect to the proposed reconcile the treatment of Timed Orders interest. Therefore, the proposed rule rule change that are filed with the during the Opening Session. change has become effective Commission, and all written Accordingly, Timed Orders designated immediately upon filing with the communications relating to the as good from 5 a.m. (Pacific Time) or Commission pursuant to Section proposed rule change between the 6:30 a.m. (Pacific Time) and designated 19(b)(3)(A) of the Act 11 and Rule 19b– Commission and any person, other than for the Opening Session will not be 4(f)(6) thereunder.12 those that may be withheld from the eligible for inclusion in the Opening A proposed rule change filed under public in accordance with the Auction or the Market Order Auction Rule 19b–4(f)(6) 13 does not become provisions of 5 U.S.C. 552, will be and, therefore, will not be reported for operative until 30 days after the date of available for inspection and copying in purposes of the Indicative Match Price filing or such shorter time as the the Commission’s Public Reference and Imbalance. The PCX believes that Commission may designate if such Room. Copies of such filing will also be the proposed change will facilitate action is consistent with the protection available for inspection and copying at ArcaEx’s dissemination of consistent of investors and the public interest. The the principal office of the PCX. All information. PCX believes that the proposed rule submissions should refer to File No. change will reconcile the treatment of SR–PCX–2003–10 and should be 2. Basis Timed Orders during the Opening submitted by April 3, 2003. The PCX believes that the proposed Session and will eliminate any potential For the Commission, by the Division of rule change is consistent with Section confusion with respect to the use of this Market Regulation, pursuant to delegated 6(b) of the Act 8 and furthers the order modifier. The PCX also believes authority.16 objectives of Section 6(b)(5) of the Act 9 that the rule change is necessary and Margaret H. McFarland, because it is designed to promote just appropriate in order to promote a fair, Deputy Secretary. and equitable principals of trade, to orderly, and competitive market. [FR Doc. 03–6069 Filed 3–12–03; 8:45 am] foster cooperation and coordination Therefore, the PCX has requested that BILLING CODE 8010–01–P with persons engaged in facilitating the Commission accelerate the transactions in securities, to remove implementation of the proposed rule impediments and perfect the changes so that it may become operative SECURITIES AND EXCHANGE mechanisms of a free and open market, immediately, before the 30-day period COMMISSION and to protect investors and the public specified in Rule 19b–4(f)(6)(iii).14 [Release No. 34–47467; File No. SR–PCX– interest. The Commission believes that it is consistent with the protection of 2002–75] B. Self-Regulatory Organization’s investors and the public interest to Statement on Burden on Competition Self-Regulatory Organizations; Order waive the 30-day period and to Approving Proposed Rule Change by The PCX does not believe that the designate that the proposed rule change the Pacific Exchange, Inc., as proposed rule change will impose any has become operative as of March 3, Amended, and Notice of Filing and burden on competition that is not 2003, the date the PCX filed the Order Granting Accelerated Approval 15 necessary or appropriate in furtherance proposal with the Commission. At any to Amendment No. 2 Relating to New of the purposes of the Act. time within 60 days after the filing of Order Types and To Amend PCXE Rule the proposed rule change, the 7.37 C. Self-Regulatory Organization’s Commission may summarily abrogate Statement on Comments on the the rule change if it appears to the March 7, 2003. Proposed Rule Change Received From Commission that such action is Members, Participants, or Others I. Introduction The PCX neither solicited nor 10 17 CFR 240.19b–4(f)(6). On December 9, 2002, pursuant to received written comments on the 11 15 U.S.C. 78s(b)(3)(A). section 19(b)(1) of the Securities proposed rule change. 12 17 CFR 240.19b–4(f)(6). Exchange Act of 1934 (‘‘Act’’)1 and Rule 13 Id. 19b–4 thereunder,2 the Pacific 14 17 CFR 240.19b–4(f)(6)(iii). Exchange, Inc. (‘‘PCX’’ or ‘‘Exchange’’), 7 See PCXE Rule 7.35(b) and PCXE Rule 7.35(c), 15 The Commission notes that it has considered respectively, for a detailed discussion of the the proposed rule’s impact on efficiency, Opening Auction and Market Order Auction. competition, and capital formation for the sole 16 17 CFR 200.30–3(a)(12). 8 15 U.S.C. 78f(b). purpose of accelerating the operative date of the 1 15 U.S.C. 78s(b)(1). 9 15 U.S.C. 78f(b)(5). proposed rule change. 15 U.S.C. 78c(f). 2 17 CFR 240.19b–4.

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through its subsidiary, PCX Equities, better for certain order types trading Order Process 11 and can be matched Inc. (‘‘PCXE’’), filed with the Securities Nasdaq securities; (3) reflect the with orders on the other side of the and Exchange Commission operational requirements of two market under prescribed conditions. (‘‘Commission’’) a proposed rule change proposed order types in the Working The Exchange proposes to adopt two to establish new order types on the Order Process; and (4) make various new variations of the Discretionary Archipelago Exchange (‘‘ArcaEx’’), the minor technical rule changes to conform Order called a ‘‘Passive Discretionary equity facility of the PCXE, and to to the Nasdaq UTP Plan, which extends Order’’ and a ‘‘Discretion Limit Order.’’ amend the ArcaEx Working Order UTP to Nasdaq SmallCap securities. A summary of these proposed order Process to enable the execution of such types is discussed below. order types. The PCX filed Amendment A. Proposed New Order Types a. Passive Discretionary. The No. 1 to the proposal on January 15, As part of its ongoing preparation for Exchange proposes to add PCXE Rule 2003.3 The PCX filed Amendment No. 2 the trading of Nasdaq securities on the 7.31(h)(2)(A) to define a Passive on March 7, 2003.4 The proposed rule ArcaEx pursuant to UTP,6 PCX proposes Discretionary Order. A Discretionary change, as amended by Amendment No. to make several new order types Order may be designated as a Passive 1, was published for comment and available to Electronic Trading Permit Discretionary Order and such order appeared in the Federal Register on (‘‘ETP’’) Holders 7 and Sponsored would be routed pursuant to PCXE Rule January 29, 2003.5 The Commission Participants 8 (collectively ‘‘Users’’), 7.37(d) only if the displayed price is received no comment letters in response which are currently in use on the marketable against an away market to the proposed rule change. This order Archipelago electronic communication participant. If the discretionary price of approves the PCX’s proposed rule network (‘‘ECN’’).9 The proposed new a Passive Discretionary Order were change, as amended, and notices and order types are discussed below. marketable, such order would only grants accelerated approval to interact with trading interest in the Amendment No. 2 to the proposed rule 1. Inside Limit Order ArcaEx Book pursuant to PCXE Rule change. An Inside Limit Order is a limit order 7.37(b)(2) and would not be routed away. Under the proposal, the Passive II. Description of the Proposal that is to be executed in whole or in part on ArcaEx. If the order were not Discretionary order type will be The proposal would amend PCXE executed in its entirety, the remaining available for exchange-listed and rules to: (1) Adopt several new order portion of the order would be routed Nasdaq securities. For Passive types to accommodate the trading of pursuant to PCXE Rule 7.37(d) to the Discretionary Orders in exchange-listed securities listed on the Nasdaq Stock market participant 10 with the best securities, if the discretionary price is Market, Inc. (‘‘Nasdaq’’), on an unlisted displayed price. Any unfilled portion of marketable, such order will only trading privileges (‘‘UTP’’) basis; (2) interact with trading interest in the amend PCXE Rule 7.37 to provide for a the order would not be routed to the next best price level until all quotes at ArcaEx Book pursuant to PCXE Rule limited exemption from the ArcaEx 7.37(b)(2) and will not be routed away. guarantee of executions at the NBBO or the current best bid or offer are exhausted. If the Inside Limit Order A Passive Discretionary Order for ITS Trade-Through Exempt Securities (as 3 In Amendment No. 1, the Exchange submitted were no longer marketable, it would be ranked in the Arca Book pursuant to defined in PCXE Rule 7.37) will be a new Form 19b–4, which replaced the original permitted to trade at a price no more filing in its entirety. PCXE Rule 7.36. 4 See Letter from Peter Bloom, Acting Managing than three cents ($0.03) away from the Director, Regulatory Policy, PCX, to Marc McKayle, 2. Discretionary Orders NBBO displayed in the Consolidated Special Counsel, Division of Market Regulation, Quote. For Passive Discretionary Orders Currently, a User can submit a Commission, dated March 7, 2003 (‘‘Amendment in Nasdaq securities, if the discretionary No. 2’’). In Amendment No. 2, the Exchange made Discretionary Order, which is an order price can be matched against orders in various clarifying and technical amendments to the to buy or sell a stated amount of a proposed rule text to: (1) Reference the ‘‘Joint Self- the ArcaEx Book, then such order will security at a specified, undisplayed Regulatory Organization Plan Governing the interact with trading interest in the price (the ‘‘discretionary price’’), as well Collection, Consolidation and Dissemination of ArcaEx Book pursuant to 7.37(b)(2). The Quotation and Transaction Information for Nasdaq- as at a specified, displayed price. The NBBO or better execution guarantee set Listed Securities Traded on Exchanges (‘‘Nasdaq undisplayed prices of a Discretionary Unlisted Trading Privileges Plan’’) in proposed forth in PCXE Rule 7.37 will not apply Order are represented in the Working PCXE Rule 1.1(aa), (2) clarify that the term ‘‘OTC/ to Passive Discretionary Orders in UTP Listing Market’’ shall have a meaning Nasdaq securities. Instead, Passive consistent with the Nasdaq Unlisted Trading 6 The Nasdaq UTP Plan was initially approved in Privileges Plan, (3) clarify the definition of ‘‘Sweep 1990. See Securities Exchange Act Release No. Discretionary Orders in Nasdaq Reserve Order’’ by replacing the word ‘‘price’’ with 28146 (June 26, 1990), 55 FR 27919 (July 6, 1990) securities would trade at no worse than the word ‘‘size,’’ (4) clarify the definition of (S7–24–89). It has subsequently been amended on the ArcaEx BBO. 12 ‘‘Random Reserve Order’’ by indicating that the several occasions to, among other things, admit new random reserve value is expressed in round-lot In the event that a Passive Participants. See also Securities Exchange Act Discretionary Order routed from ArcaEx increments and by correcting a grammatical error, Release No. 46381 (August 19, 2002), 67 FR 54687 (5) amend the definition of ‘‘Pegged Order’’ to (August 23, 2002) (S7–24–89) (Order approving to another market participant is not reflect that the display price will track the relevant most recent amendments to Nasdaq UTP Plan, the executed in its entirety at the other Consolidated Quote information for such orders on 13th Amendment). market participant’s quote, ArcaEx a real-time basis and that the displayed price of a 7 Pegged Order designated as a Discretionary Order See PCXE Rule 1.1(n). would attempt to execute the residual will track the National Best Bid or Offer (‘‘NBBO’’), 8 A ‘‘Sponsored Participant’’ means ‘‘a person trading interest in the ArcaEx Book which has entered into a sponsorship arrangement and that the discretionary price of such order would pursuant to PCXE Rule 7.37. Finally, re-price in correlation to any changes to the with a Sponsoring ETP Holder pursuant to [PCXE] displayed price, and (6) clarify that Immediate or Rule 7.29.’’ See PCXE Rule 1.1(tt). Cancel (‘‘IOC’’), NOW, Post No Preference (‘‘PNP’’), 9 The broker-dealer commonly referred to as the 11 The Working Order Process is the third step in Passive Discretionary, Discretion Limit, IOC Cross Archipelago ECN is Archipelago Securities, a the ArcaEx execution algorithm. Working Orders and PNP Cross orders in Nasdaq securities would wholly owned subsidiary of Archipelago Holdings are defined to include any order with a conditional received executions no worse than the ArcaEx Best LLC and a member of the NASD. The ECN function or undisplayed price and/or size, including All-or- Bid or Offer (‘‘BBO’’). will cease to operate as such once all the Nasdaq None, Discretionary, and Reserve Orders. See PCXE 5 Securities Exchange Act Release No. 47223 securities have been transferred to ArcaEx. Rule 7.37(b)(2) (description of ‘‘Working Order (January 21, 2003), 68 FR 4527 (January 29, 2003) 10 See PCXE Rule 1.1(w) (definition of ‘‘market Process’’). (SR–PCX–2002–75). participant’’). 12 See Amendment No. 2, supra note 4.

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Passive Discretionary Orders that are amount that would be used to determine Pegged Order that is updated would be not marketable would be ranked in the the displayed quantity within a defined assigned a new entry time with priority ArcaEx Book pursuant to PCXE Rule range each time it is replenished. These in accordance with PCXE Rule 7.36(a). 7.36. proposed order types are discussed A Pegged Order may be designated as a b. Discretion Limit. The Exchange also separately below. Reserve Order or Discretionary Order proposes to add PCXE Rule 7.31(h)(2)(B) a. Sweep Reserve Order. Under and would be subject to the applicable to define a Discretion Limit Order. A proposed PCXE Rule 7.31(h)(3)(A), a order execution rules. The displayed Discretionary Order may be designated Reserve Order may be designated as a price of a Pegged Order designated as a as a Discretion Limit Order for Nasdaq Sweep Reserve Order. Based upon a Discretionary Order would track the securities only. If the discretionary price User’s instruction, if the displayed price NBBO, and discretionary price of such of a Discretion Limit Order could be of a Sweep Reserve Order is marketable order would re-price in correlation to matched against trading interest in the against an away market participant(s), any changes to the displayed price.17 ArcaEx Book, then such order would be then such order will be routed (i) Finally, Pegged Orders are only eligible executed at the discretionary price or serially as component orders, such that during the Core Session. each component corresponds to the better against the displayed share size of B. Changes to PCXE Rule 7.37 available trading interest in the ArcaEx displayed size, or (ii) only once in its Book, regardless of size. If the entirety, including both the displayed The Exchange’s current rules discretionary price of a Discretion Limit and reserve portions. The Exchange governing the order execution processes Order could be matched against an away believes that this rule change codifies for orders in the ArcaEx Book are set market participant, then such order current order routing methodology, and forth in PCXE Rule 7.37. Presently, would be routed pursuant to PCXE Rule believes that the proposed Sweep PCXE Rule 7.37 provides, in part, that 7.37(d) but only if the displayed share Reserve Order type is clearly implied in for an execution to occur in any Order size of the Discretion Limit Order is current PCXE Rule 7.37(d)(2)(A)(ii). Process, the price must be equal to or equal to or less than the displayed share b. Random Reserve Order. The better than the NBBO. The requirements size of the away market participant. The Exchange proposes to add PCXE Rule of this rule do not apply to orders NBBO or better execution guarantee set 7.31(h)(3)(B) to define a Random designated as IOC, NOW and PNP in forth in PCXE Rule 7.37 would not Reserve Order. Under the rule proposal, certain exchange-traded funds (‘‘ETFs’’) apply to Discretion Limit Orders. a User could determine a display and that are subject to the Commission’s Instead, Discretion Limit Orders, which reserve quantity for a Reserve Order. In order granting a de minimis exemption will only be available for the trading of addition, a User could also define a from the trade-through restrictions of Nasdaq Securities, will not trade at a random reserve delta (expressed in a the Intermarket Trading System (‘‘ITS’’) price inferior to the ArcaEx BBO. 13 share amount) to determine the number Plan; provided, however, that any of shares to display when the quote is resulting executions will be at a price no 3. Reserve Orders refreshed from reserve.15 Users are more than three cents ($0.03) away from Under current PCXE Rule 7.31(h)(3), a required to display at least 100 shares the NBBO displayed in the Consolidated Reserve Order is a limit order with a for all Reserve Orders including Quote.18 The Exchange proposes that portion of the size displayed and with Random Reserve Orders. If the User the requirements of PCXE Rule 7.37 a reserve portion of the size (‘‘reserve does not specify the random reserve would not apply to existing order types size’’) that is not displayed on the delta or the random reserve delta is set (IOC, NOW and PNP orders) and ArcaEx Book. With this filing, the to zero, the ArcaEx system would assign proposed new order types (Passive Exchange proposes to adopt two new the displayed size of the Reserve Order Discretionary, Discretion Limit, IOC 19 variations of the Reserve Order, a to vary to within 20% of the original Cross and PNP Cross) in Nasdaq ‘‘Sweep Reserve Order’’ and a ‘‘Random specified displayed size. Should a User securities, provided however that such Reserve Order.’’ These proposed order enter a Random Reserve Order with a orders in Nasdaq securities would not types would be ranked and maintained display amount of 500 shares or less and result in an execution at a price less 20 in the Display Order Process 14 and/or a random reserve delta that is than the ArcaEx BBO. Working Order Process of the ArcaEx unspecified or set to zero, the order C. Working Order Process Book according to price-time priority would be handled as a regular Reserve The Exchange proposes the following and would be processed for internal Order. The ArcaEx system would conforming changes to certain matches in the same manner as standard refresh the display quantity to the provisions of the Working Order Process Reserve Orders pursuant to PCXE Rule original displayed size, and would not set forth in PCXE Rule 7.37(b)(2): 7.37(b)(2). The proposed rule change vary the display quantity. Under the proposal PCXE Rule regarding Sweep Reserve Orders should 4. Pegged Orders 7.37(b)(2) will be amended to clarify the clarify how ArcaEx treats such orders The Exchange proposes to modify the when routing to other market 17 ArcaEx trading system to accept Pegged See Amendment No. 2, supra note 4. participants is required. In the case of a 18 See Securities Exchange Act Release No. 46428 Random Reserve Order, the proposed Orders. A Pegged Order is a limit order (August 28, 2002), 67 FR 56607 (September 4, 2002) rule change would allow a User to to buy or sell a stated amount of a (Order Pursuant to Section 11A of the Act and Rule define the original display quantity and security at a display price set to track 11Aa3–2(f) thereunder Granting a De Minimis the current bid or ask of the NBBO in Exemption for Transactions in Certain ETFs from a random reserve value in a share the ITS Trade-Through Provisions. See also 16 an amount specified by the User. The Securities Exchange Act Release No. 46684 (October 13 See Amendment No. 2, supra note 4. tracking of the relevant Consolidated 17, 2002), 67 FR 65618 (October 25, 2002) (SR– 14 The Display Order Process is the second step Quote information for Pegged Orders PCX–2002–69). in the ArcaEx execution algorithm. In this process, would occur dynamically on a real-time 19 See Securities Exchange Act Release No. 47178 the ArcaEx system matches an incoming marketable basis. The associated price of each (January 13, 2003), 68 FR 3076 (January 22, 2003) order against orders in the Display Order Process (Order approving File No. SR–PCX–2002–74). The at the display price of the resident order for the Commission recently approved a separate proposed total size available at the that price or for the size 15 See Amendment No. 2, supra note 4. rule change establishing IOC Cross and PNP Cross of the incoming order. See PCXE Rule 7.37(b)(1) 16 See proposed PCXE Rule 7.31(cc) (definition of Orders. description of ‘‘Display Order Process’’). ‘‘Pegged Order’’). 20 See Amendment No. 2, supra note 4.

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conditions in which a Passive definition of ‘‘OTC/UTP Listing Market’’ market participants with more choices Discretionary Order and Discretion is being adopted from the Nasdaq UTP that will permit a more accurate Limit Order would be routed to an away Plan.21 representation of their trading interest market participant’s quote. Passive on its electronic auction trading facility. III. Solicitation of Comments Discretionary Orders would be routed In the Commission’s view, the proposed away only if the displayed price is Interested persons are invited to order types could provide a new and marketable against an away market submit written data, views and advanced way for sophisticated trading participant. Discretion Limit Orders arguments concerning Amendment No. interests and strategies to be represented would be routed away only if the 2, including whether Amendment No. 2 and executed on ArcaEx. Further, the displayed share size of such order is is consistent with the Act. Persons Commission believes that by amending equal to or less than the displayed share making written submissions should file the rules to include pricing and size of the away market participant. six copies thereof with the Secretary, execution scenarios for the new order Several pricing scenarios have been Securities and Exchange Commission, types in the Working Order Process the added to the Working Order Process 450 Fifth Street, NW., Washington, DC proposed rule change should assist regarding incoming marketable orders 20549–0609. Copies of the submission, Users in effectuating such trading that could be matched against a Passive all subsequent amendments, all written interests and strategies. The Discretionary Order. First, for Nasdaq statements with respect to the proposed Commission believes that the securities, if the ArcaEx BBO is outside rule change that are filed with the implementation of the new order types the NBBO and a Passive Discretionary Commission, and all written may enhance the ability of investors to Order(s) within the Working Order communications relating to the represent their trading interest more Process has a discretionary price worse proposed rule change between the completely than is currently possible on than the NBBO, then the incoming order Commission and any person, other than ArcaEx. In addition, the new order types would execute against such Passive those that may be withheld from the may facilitate enhanced order Discretionary Order(s) at the price of the public in accordance with the interaction and foster price competition. incoming order or the displayed price of provisions of 5 U.S.C. 552, will be The depth and liquidity of the market the Discretionary Order(s), whichever is available for inspection and copying in on ArcaEx could increase as a result of better. Second, for Nasdaq securities, if the Commission’s Public Reference the enhanced interest and competition the ArcaEx BBO is outside the NBBO Room. Copies of such filing will also be on ArcaEx. The Commission believes and a Passive Discretionary Order(s) available for inspection and copying at that, such order types could assist within the Working Order Process has a the principal office of the PCX. All ArcaEx in attracting new market discretionary price equal to or better submissions should refer to Amendment participants and to increase order flow than the NBBO, then the incoming order No. 2 of File No. SR–PCX–2002–75 and to the PCXE, which in turn could would execute against such Passive should be submitted by April 3, 2003. promote greater competition among Discretionary Order(s) pursuant to IV. Commission’s Findings and Order market centers. current PCXE Rule 7.37(b)(2)(A)(ii). Granting Accelerated Approval of Pursuant to PCXE Rule 7.37 quotes Finally, for ITS Trade-Through Exempt Proposed Rule Change and orders on the ArcaEx, except those Securities (as defined in PCXE Rule in ITS Trade-Through Exempt 7.37), if the ArcaEx BBO is outside the After careful review, the Commission Securities, must be executed at a price NBBO and a Passive Discretionary finds, for the reasons discussed below, equal to or better than the NBBO, unless Order(s) within the Working Order that the proposal is consistent with the ArcaEx has routed the order to an away Process has a discretionary price worse requirements of the Act and the rules market at the NBBO. Under the than the NBBO by three cents ($0.03) or and regulations thereunder applicable to proposal, executions in IOC, NOW, less, the incoming order would execute the PCX.22 The Commission finds that PNP, Passive Discretionary, Discretion against such Passive Discretionary the proposed rule change is consistent Limit, IOC Cross, and PNP Cross orders Order(s) at the price of the incoming requirements of section 6(b)(5) of the for Nasdaq securities would also be order or the displayed price of the Act 23 and the objectives of section included in the ArcaEx exception to the Discretionary Orders(s), whichever is 11A(a)(2) of the Act.24 Section 6(b)(5) PCXE Rule 7.37 price protection better. requires, among other things, that the provision. Specifically, executions in rules of a national securities exchange such orders in Nasdaq securities could D. Technical Changes be designed to facilitate transactions in be effected at a price no worse than the The Exchange has proposed to adopt securities and to remove impediments ArcaEx BBO. The Commission notes several minor technical changes to and perfect the mechanism of a free that currently there is no trade-through throughout PCXE Rules 1.1 and 7.18 to and open market and a national market prohibition for Nasdaq securities conform to the Nasdaq UTP Plan, which system. Section 11A(a)(2) of the Act because the Nasdaq UTP Plan does not extends UTP to Nasdaq SmallCap authorizes the Commission to establish provide for intermarket linkages securities. Accordingly, the Exchange is a national market system for securities, between its participants like the listed proposing to delete references to the which should include the establishment securities market.26 The Commission term ‘‘Nasdaq/NM Security’’ and of new data processing and believes that without the presence of an replacing it with ‘‘Nasdaq Security.’’ In communications techniques.25 intermarket linkage for Nasdaq UTP addition, several definitions contained In proposing to establish new order Plan participants it would be in PCXE Rule 1.1 are being amended to types on ArcaEx, PCX seeks to provide impracticable for PCXE to attempt to reflect the change in name of the Nasdaq provide intermarket price protection for UTP Plan. Finally, current PCXE Rule 21 See supra note 6. the above-mentioned orders in Nasdaq 1.1(jj), which defines the term ‘‘OTC/ 22 In approving this rule, the Commission notes securities. Nonetheless, the Commission UTP Primary Market,’’ is being amended that it has considered the proposal’s impact on efficiency, competition, and capital formation. See emphasizes that this approval order to reflect that the Listing Market, rather 15 U.S.C. 78c(f). does not diminish investor protections, than the Primary Market, would have 23 15 U.S.C. 78f(b)(5). and that such orders in Nasdaq the authority to call a Regulatory Halt 24 15 U.S.C. 78k–1(a)(2). pursuant to PCXE Rule 7.18(c). A 25 15 U.S.C. 78k–1(a)(2). 26 See supra note 6.

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securities on ArcaEx are still subject to For the Commission, by the Division of program, the Exchange is proposing to a broker’s duty of best execution for its Market Regulation, pursuant to delegated share with the QQQ specialist unit a 28 customer. authority. portion of the revenues that the Margaret H. McFarland, Exchange receives under the The Commission finds good cause for Deputy Secretary. approving Amendment No. 2 to the Consolidated Tape Association (‘‘CTA’’) [FR Doc. 03–6072 Filed 3–12–03; 8:45 am] Plan 5 attributable to the QQQ (which is proposed rule change prior to the BILLING CODE 8010–01–P reportable on Tape B).6 The Exchange thirtieth day after the date of proposes to begin its program on publication of notice of filing thereof in November 1, 2002. the Federal Register. In Amendment SECURITIES AND EXCHANGE The text of the proposed rule change No. 2, the Exchange made various COMMISSION is set forth below. Additions are in clarifying and technical amendments to [Release No. 34–47456; File No. SR–Phlx– italics. the proposed rule text to: (1) Reference 2002–77] Specialist Revenue Sharing Program for the ‘‘Joint Self-Regulatory Organization Nasdaq-100 Index Tracking Stock Plan Governing the Collection, Self-Regulatory Organizations; Notice (‘‘QQQ’’) Consolidation and Dissemination of of Filing of Proposed Rule Change and The Exchange will share a portion of net Amendment No. 1 Thereto by the Quotation and Transaction Information revenues that it receives for Tape B Philadelphia Stock Exchange, Inc. To for Nasdaq-Listed Securities Traded on under the Consolidated Tape Adopt a Specialist Revenue Sharing Exchanges’’ in proposed PCXE Rule Association (‘‘CTA’’) Plan attributable Plan for Trades in the Nasdaq-100 1.1(aa), (2) clarify that the term ‘‘OTC/ to the Nasdaq-100 Index Trading Stock Index Tracking Stock UTP Listing Market’’ shall have a (‘‘QQQ’’) with the specialist unit for the meaning consistent with the Nasdaq March 6, 2003. QQQ. The Specialist Revenue Sharing Unlisted Trading Privileges Plan, (3) Pursuant to section 19(b)(1) of the Program operates as follows: clarify the definition of ‘‘Sweep Reserve Securities Exchange Act of 1934 • Revenues under the CTA Plan are Order’’ by replacing the word ‘‘price’’ (‘‘Act’’),1 and Rule 19b–4 thereunder,2 distributed to Plan Participants on a with the word ‘‘size,’’ (4) clarify the notice is hereby given that on December quarterly basis. Each quarter, the Phlx definition of ‘‘Random Reserve Order’’ 16, 2002, the Philadelphia Stock will start its calculation with the by indicating that the random reserve Exchange, Inc. (‘‘Phlx’’ or ‘‘Exchange’’), quarterly revenues actually received for value is expressed in share amounts and filed with the Securities and Exchange Tape B. by correcting a grammatical error, (5) Commission (‘‘Commission’’), the • First, Phlx will determine the amend the definition of ‘‘Pegged Order’’ proposed rule change as described in portion of such quarterly revenues to reflect that the display price will Items I, II, and III below, which Items attributable to the trading of QQQ for track the relevant Consolidated Quote have been prepared by Phlx. The each calendar month in the quarter to Exchange amended the proposal on which the revenue is attributed. information for such orders on a real- • time basis and that the displayed price February 28, 2003.3 The Commission is Then, Phlx will subtract the amount of a Pegged Order designated as a publishing this notice to solicit it owes Nasdaq under its license agreement for each such calendar Discretionary Order will track the comments on the proposed rule change, month, to arrive at the ‘‘Monthly NBBO, and that the discretionary price as amended, from interested persons. Residual QQQ Tape Revenue’’ for that of such order would re-price in I. Self-Regulatory Organization’s month. correlation to any change in the Statement of the Terms of Substance of • The Monthly Residual QQQ Tape displayed price, and (6) clarify that IOC, the Proposed Rule Change Revenue will be shared between Phlx NOW, PNP, Passive Discretionary, The Phlx proposes to amend its and the QQQ specialist unit in the Discretion Limit, IOC Cross and PNP schedule of dues, fees and charges to following order of priority, in each case Cross orders in Nasdaq securities will adopt a Specialist Revenue Sharing Plan to the extent that Monthly Residual received executions at a price no worse for trades in the Nasdaq-100 Index QQQ Tape Revenues are available: than the ArcaEx BBO. Because Tracking Stock (‘‘QQQ’’).SM 4 Under this (i) Phlx will receive the first $15,000 Amendment No. 2 is of a technical, per month of the Monthly Residual QQQ clarifying, non-substantive nature, and 28 17 CFR 200.30–3(a)(12). Tape Revenue to cover, at a minimum, does not raise any novel regulatory 1 15 U.S.C. 78s(b)(1). its estimated monthly costs for 2 issues or issues that were not 17 CFR 240.19b–4. operating and regulating trading of the 3 On February 28, 2003, the Exchange filed a considered by the Commission prior to Form 19b–4, which replaced the original filing in QQQ on the Exchange; its submission, the Commission finds its entirety (‘‘Amendment No. 1’’). In Amendment (ii) the specialist unit will receive the good cause for accelerating approval of No. 1, the Exchange made technical corrections to next $15,000 per month; and the proposed rule text. the proposed rule change, as amended 4 The Nasdaq-100, Nasdaq-100 Index, 5 by Amendment No. 2. Nasdaq, The Nasdaq Stock Market, Nasdaq-100 The CTA Plan is a national market system plan Shares SM, Nasdaq-100 Trust SM, Nasdaq-100 Index approved by the Commission pursuant to section V. Conclusion Tracking Stock SM, and QQQ SM are trademarks or 11A of the Act, (15 U.S.C. 78k–1, and Rule 11Aa3– service marks of The Nasdaq Stock Market, Inc. 2 thereunder, 17 CFR 240.11Aa3–2); CTA Plan: (‘‘Nasdaq’’) and have been licensed for use for Second Restatement of Plan Submitted to the It is therefore ordered, pursuant to Securities and Exchange Commission Pursuant to 27 certain purposes by the Phlx pursuant to a License section 19(b)(2) of the Act, that the Agreement with Nasdaq. The Nasdaq-100 Index Rule 11Aa3–1 under the Act, May 1974 as restated proposed rule change, (File No. SR– (the ‘‘Index’’) is determined, composed, and March 1980 and December 1995. The CTA Plan PCX–2002–75) as amended, be, and it calculated by Nasdaq without regard to the governs, among other things, the collection, Licensee, the Nasdaq-100 Trust SM, or the beneficial consolidation and dissemination of transaction hereby is approved. owners of Nasdaq-100 Shares SM. Nasdaq has reports in certain securities and the distribution of complete control and sole discretion in the revenues derived therefrom among parties to the determining, comprising, or calculating the Index or CTA Plan, which are known as the Plan in modifying in any way its method for Participants. determining, comprising, or calculating the Index in 6 This proposal applies only to QQQ and to no 27 15 U.S.C. 78s(b)(2). the future. other Tape B security nor any Tape A security.

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(iii) Phlx and the specialist unit will usually received 45 days after the end public interest, by encouraging use of share equally, subject to reasonable of a quarter. First, the Phlx would the Phlx for trading the QQQ. Similarly, rounding, any remaining Monthly determine the portion of such quarterly the Phlx believes that the Specialist Residual QQQ Tape Revenue for that revenues attributable to trading in the Revenue Sharing Program for QQQ is month. QQQ for each calendar month in that consistent with section 11A of the Act,13 Phlx intends to perform this quarter.7 Then, the Phlx would subtract because it is in the public interest and calculation monthly and then make the amount it owes Nasdaq under its appropriate for the protection of distributions to the specialist unit license agreement. The remainder (if investors and the maintenance of fair quarterly, after it receives its Tape B any) respecting that calendar month and orderly markets to assure: (i) distribution under the Plan for that (‘‘Monthly Residual QQQ Tape Economically efficient execution of quarter and following a reasonable Revenue’’) would be shared between the securities transactions; and (ii) fair processing period of ten business days.I Phlx and the QQQ specialist unit in the competition among exchange markets The program will apply to Tape B following order of priority, in each case and between exchange markets and revenues in respect of QQQ trading on to the extent that Monthly Residual markets other than exchange markets. It or after November 1, 2002.II QQQ Tape Revenues are available: (i) also furthers the objectives of section II. Self-Regulatory Organization’s The Phlx would receive the first $15,000 6(b)(4) of the Act 14 in that it is an Statement of the Purpose of, and per month of the Monthly Residual equitable allocation of reasonable dues, Statutory Basis for, the Proposed Rule QQQ Tape Revenue to cover, at a fees, and other charges among Exchange Change minimum, its estimated costs for members. operating and regulating trading of the In its filing with the Commission, the QQQ; 8 (ii) the specialist unit would B. Self-Regulatory Organization’s Exchange included statements receive the next $15,000 per month; and Statement on Burden on Competition concerning the purpose of, and basis for, (iii) the Phlx and the specialist unit The Phlx does not believe that the the proposed rule change and discussed would share equally, subject to proposed rule change will impose any any comments it received on the reasonable rounding, any remaining proposed rule change. The text of these inappropriate burden on competition. Monthly Residual QQQ Tape Revenue The Phlx states that the proposal is statements may be examined at the for that month. The proposal would be places specified in Item IV below. The designed to attract additional business applied separately to each month; trades to the Exchange in the QQQ by reducing Phlx has prepared summaries, set forth from one month may not be transferred in sections A, B, and C below, of the the specialist unit’s costs and providing to or aggregated with trades from it with additional funds to commit to most significant aspects of such another month. statements. trading, and, thus, should promote The Phlx intends to perform this competition among market centers A. Self-Regulatory Organization’s calculation in respect of each monthly trading such securities. Statement of the Purpose of, and period and then make distributions to Statutory Basis for, the Proposed Rule the specialist unit quarterly, after it C. Self-Regulatory Organization’s Change receives its Tape B distribution under Statement on Comments on the the Plan and following a reasonable Proposed Rule Change Received From 1. Purpose processing period of ten business days.9 Members, Participants, or Others The purpose of the proposed rule The program would apply to revenue in The Phlx has neither solicited nor respect of QQQ trading on and after change is to attract additional business received written comments with respect November 1, 2002. in the QQQ equity product through a to the proposed rule change. Specialist Revenue Sharing Program. 2. Statutory Basis The Specialist Revenue Sharing III. Date of Effectiveness of the Program is intended to provide the The Phlx believes that the proposed Proposed Rule Change and Timing for specialist unit with incentives to grow rule change is consistent with the Act, Commission Action its specialist activity in the QQQ by including section 6(b)10 and section 11A 11 Within 35 days of the date of reducing its costs of doing business and of the Act, and will further the 12 publication of this notice in the Federal providing it with additional funds to objectives of section 6(b)(5) of the Act Register or within such longer period (i) commit to trading to promote liquidity. by promoting just and equitable as the Commission may designate up to The Specialist Revenue Sharing principles of trade, removing Program would operate as follows: impediments to and perfecting the 90 days of such date if it finds such Revenues under the CTA Plan are mechanism of a free and open market longer period to be appropriate and distributed to Plan Participants on a and a national market system and, in publishes its reasons for so finding or quarterly basis. Each quarter, the Phlx general, protecting investors and the (ii) as to which the Phlx consents, the would start its calculation with the Commission will: quarterly revenues actually received for 7 The Phlx states that its total revenue Tape B (A) By order approve such proposed Tape B in respect of a given, prior distribution may be attributable to trades in rule change, or, securities other than QQQ. (B) Institute proceedings to determine quarter; such quarterly revenues are 8 The Exchange will periodically reconsider whether this amount is appropriate, and may adjust whether the proposed rule change I Accordingly, this proposal is dependent upon this figure from time to time, pursuant to a should be disapproved. the Exchange actually collecting its quarterly proposed rule change. distribution of Tape B revenues. Any transaction or 9 Accordingly, this proposal is dependent upon IV. Solicitation of Comments other fees that the QQQ specialist unit may owe to the Exchange actually collecting its quarterly the Exchange are handled separately from this distribution of Tape B revenues. Any transaction or On July 2, 2002, the Commission program, pursuant to the Exchange’s fee schedules other fees that the QQQ specialist unit may owe to issued an Order abrogating certain and billing practices. the Exchange are handled separately from this proposed rule changes relating to II For the first quarter of implementation, because program, pursuant to the Exchange’s fee schedules market data revenue sharing the program will begin on November 1, 2002, the and billing practices. calculations will be based on the quarterly revenues 10 15 U.S.C. 78f. received for the period November 1–December 31, 11 5 U.S.C. 78k–1. 13 15 U.S.C. 78k–1. 2002 (excluding the month of October). 12 15 U.S.C. 78f(b)(5). 14 15 U.S.C. 78f(b)(4).

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programs.15 In that Order, the DEPARTMENT OF STATE inquiries or submitting proposals. Once Commission expressed concern that the the RFGP deadline has passed, Bureau [Public Notice 4299] subject proposed rule changes raised staff may not discuss this competition ‘‘serious questions as to whether they Bureau of Educational and Cultural with applicants until the proposal are consistent with the Act and with the Affairs Request for Grant Proposals: review process has been completed. protection of investors.’’ Specifically, Central and Eastern European To Download a Solicitation Package via the Commission questioned the effect of Professional Exchanges and Training Internet market data rebates on the accuracy of Program for Albania, Bosnia- The entire Solicitation Package may market data, and on the regulatory Herzegovina, Bulgaria, Croatia, be downloaded from the Bureau’s Web functions of self-regulatory Estonia, Kosovo, Latvia, Lithuania, site at http://exchanges.state.gov/ Macedonia, Romania, and Serbia and organizations. education/RFGPs. Please read all Montenegro The Commission now solicits information before downloading. comment on the Phlx proposed rule SUMMARY: The Europe/Eurasia division General Program Guidelines change, and in general, on (1) Market of the Office of Citizen Exchanges of the data fees; (2) the collection of market Bureau of Educational and Cultural Applicants should identify the local data fees; (3) the distribution of market Affairs announces an open competition organizations and individuals in the data rebates; (4) the effect of market data for Central and Eastern European counterpart country with whom they are revenue sharing programs on the Professional Exchanges and Training proposing to collaborate and describe in accuracy of market data; and (5) the Programs for Albania, Bosnia- detail previous cooperative impact of market data revenue sharing Herzegovina, Bulgaria, Croatia, Estonia, programming and/or contacts. Specific programs on the regulatory functions of Kosovo, Latvia, Lithuania, Macedonia, information about the counterpart organizations’ activities and self-regulatory organizations. Romania, and Serbia and Montenegro. accomplishments should be included in Interested persons are invited to Public and private non-profit organizations meeting the provisions the section on Institutional Capacity. submit written data, views and described in Internal Revenue Code Proposals should contain letters of arguments concerning the foregoing, section 26 U.S.C. 501(c)(3) may submit support tailored to the project being including whether the proposed rule proposals that support international proposed from foreign-country partner change, as amended, is consistent with projects in the United States and organizations. the Act. Persons making written overseas involving current or potential Exchanges and training programs submissions should file six copies leaders. supported by institutional grants from thereof with the Secretary, Securities Interested applicants should read the the Bureau should operate at two levels: and Exchange Commission, 450 Fifth complete Federal Register they should enhance institutional Street, NW., Washington, DC 20549– announcement before addressing partnerships, and they should offer 0609. Copies of the submission, all inquiries to the Office of Citizen practical information and experience to subsequent amendments, all written Exchanges or submitting proposals. individuals and groups to assist them statements with respect to the proposed Announcement Title and Number: All with their professional responsibilities. rule change that are filed with the correspondence with the Bureau Strong proposals usually have the Commission, and all written concerning this RFGP should reference following characteristics: • A proven track record of working in communications relating to the the above title and number ECA/PE/C/ the proposed issue area and country; proposed rule change between the EUR–03–39. • Experienced staff with language Commission and any person, other than FOR FURTHER INFORMATION CONTACT: The facility and a commitment by the staff those that may be withheld from the Office of Citizen Exchanges, ECA/PE/C/ to monitor projects locally to ensure public in accordance with the EUR, Room 224, U.S. Department of implementation; provisions of 5 U.S.C. 552, will be State, SA–44, 301 4th Street, SW., • A clear, convincing plan showing available for inspection and copying in Washington, DC 20547, Attention: how permanent results will be the Commission’s Public Reference Central and Eastern Europe Professional accomplished as a result of the activity Room. Copies of such filing will also be Exchanges and Training Program, funded by the grant; and available for inspection and copying at telephone number: 202–205–3003, fax • A follow-on plan that includes the principal office of the Phlx. All number 202–619–4350 or activities beyond the conclusion and submissions should refer to File No. [email protected] to request a scope of the Bureau grant. SR–Phlx–2002–77 and should be Solicitation Package. The Solicitation Proposal narratives should clearly submitted by April 3, 2003. Package contains detailed award demonstrate an organization’s criteria, required application forms, commitment to consult closely with the For the Commission, by the Division of specific budget instructions, and Public Affairs Section, and when Market Regulation, pursuant to delegated standard guidelines for proposal required, other officers at the U.S. 16 authority. preparation. Embassy. Proposal narratives must Margaret H. McFarland. For specific inquiries, please contact confirm that all materials developed for Deputy Secretary. Bureau program officers by phone or e- the project will acknowledge Bureau [FR Doc. 03–6076 Filed 3–12–03; 8:45 am] mail: Kendra Davis (202) 619–5328 funding for the program as well as a BILLING CODE 8010–01–P ([email protected]); Michael George commitment to invite representatives of (202) 619–5330 the Embassy and/or Consulate to ([email protected]); Brent Beemer participate in various program sessions/ 15 See Securities Exchange Act Release No. 46159 (July 2, 2002), 67 FR 45775 (July 10, 2002) (File (202) 401–6887 ([email protected]); site visits. Please note that this will be Nos. SR–NASD–2002–61, SR–NASD–2002–68, SR– or Henry Scott (202) 619–5327 a formal requirement in all final grant CSE–2002–06, and SR–PCX–2002–37) (Order of ([email protected]). awards. Summary Abrogation). Please read the complete Federal Organizations with less than four 16 17 CFR 200.30–3(a)(12). Register announcement before sending years of experience managing

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international exchange programs are provide their names and brief the exchange program covered by this limited to requesting $60,000 in funds. biographical data to the Office of Citizen RFGP, and an employee of the Bureau Exchanges. Priority in two-way will be the ‘‘Responsible Officer’’ for the Suggested Program Designs exchange proposals will be given to program under the terms of 22 CFR 62, Bureau-supported exchanges may foreign participants who have not which covers the administration of the include internships; study tours; short- previously traveled to the United States. Exchange Visitor Program (J visa term, non-technical experiential (See section below on requirements for program). Under the terms of 22 CFR 62, learning, extended and intensive maintenance of and provision to the organizations receiving grants under workshops and seminars taking place in Bureau of data on participants and this RFGP will be third parties the United States or overseas. Examples program activities.) ‘‘cooperating with or assisting the of program activities include: Evaluation sponsor in the conduct of the sponsor’s 1. A U.S.-based program that program.’’ The actions of grantee includes: Orientation to program In general, evaluation should occur program organizations shall be purposes and to U.S. society; study throughout the project. The evaluation ‘‘imputed to the sponsor in evaluating tour/site visits; professional internships/ should incorporate an assessment of the the sponsor’s compliance with’’ 22 CFR placements; interaction and dialogue; program from a variety of perspectives. 62. Therefore, the Bureau expects that hands-on training; professional Specifically, project assessment efforts any organization receiving a grant under development; and action plan will focus on: (a) Determining if this competition will render all development. Proposals that include objectives are being met or have been assistance necessary to enable the U.S.-based training will receive the met, (b) identifying any unmet needs, Bureau to fully comply with 22 CFR highest priority. and (c) assessing if the project has part 62 et seq. The Bureau of 2. Capacity-building/training-of- effectively identified resources, Educational and Cultural Affairs places trainer (TOT) workshops to help advocates, and financial support for the great emphasis on the secure and proper participants to identify priorities, create sustainability of future projects. administration of Exchange Visitor (J work plans, strengthen professional and Informal evaluation through discussions visa) Programs and adherence by volunteer skills, share their experience and other sources of feedback will be grantee program organizations and with committed people within each carried out throughout the duration of program participants to all regulations country, and become active in a the project. governing the J visa program status. practical and valuable way. Formal evaluation must be conducted Therefore, proposals should explicitly 3. Site visits by U.S. facilitators/ at the end of each component, should state in writing that the applicant is experts to monitor projects in the region measure the impact of the activities and prepared to assist the Bureau in meeting and to provide additional training and should obtain participants’ feedback on all requirements governing the consultations as needed. the program content and administration. Activities ineligible for support: The administration of Exchange Visitor A detailed evaluation will be conducted Programs as set forth in 22 CFR 62. If Office does not support proposals at the conclusion of the project and a limited to conferences or seminars (i.e., the applicant has experience as a report will be submitted to the designated Exchange Visitor Program one to fourteen-day programs with Department of State Bureau of plenary sessions, main speakers, panels, Sponsor, the applicant should discuss Educational and Cultural Affairs. When their record of compliance with 22 CFR and a passive audience). It will support possible, the evaluation should be conferences only when they are a small 62 et seq., including the oversight of conducted by an independent evaluator. their Responsible Officers and Alternate part of a larger project in duration that Program Data Requirements: is receiving Bureau funding from this Responsible Officers, screening and Organizations awarded grants will be selection of program participants, competition. The Office will only required to maintain specific data on support workshops, seminars and provision of pre-arrival information and program participants and activities in an orientation to participants, monitoring training sessions that are an integral part electronically accessible database format of a larger project. No funding is of participants, proper maintenance and that can be shared with the Bureau as security of forms, record-keeping, available exclusively to send U.S. required. As a minimum, the data must citizens to conferences or conference- reporting and other requirements. include the following: The Office of Citizen Exchanges of type seminars overseas; nor is funding (1) Name, address, contact ECA will be responsible for issuing DS– available for bringing foreign nationals information and biographic sketch of all 2019 forms to participants in this to conferences or to routine professional persons who travel internationally on program. association meetings in the United funds provided by the grant or who A copy of the complete regulations States. benefit from the grant funding but do governing the administration of Selection of Participants not travel. Exchange Visitor (J) programs is (2) Itineraries of international and available at http://exchanges.state.gov All grant proposals should clearly domestic travel, providing dates of or from: United States Department of describe the type of persons who will travel and cities in which any exchange State, Office of Exchange Coordination participate in the program as well as the experiences take place. Final schedules and Designation, ECA/EC/ECD—SA–44, participant selection process. For for in-country and U.S. activities must Room 734, 301 4th Street, SW., programs that include U.S. internships, be received by the ECA/PE/C/EUR Washington, DC 20547, Telephone: applicants should submit letters of Program Officer at least three work days (202) 401–9810, FAX: (202) 401–9809. support from host institutions. In the prior to the official opening of the selection of foreign participants, the activity. Program Information Bureau and U.S. Embassies will review all participant nominations and may Adherence to All Regulations Overview accept or refuse participants Governing the J Visa The Bureau welcomes proposals that recommended by grantee institutions. The Office of Citizen Exchanges of the respond directly to the themes and When American participants are Bureau of Educational and Cultural countries listed below. Given budgetary selected, grantee institutions must Affairs is the official program sponsor of considerations, projects in countries and

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for themes other than those listed will Bulgarian library association) should Mayors and Local Leaders Exchange not be eligible for consideration and serve as the in-country partner Kosovo—Single country projects will be ruled technically ineligible. No organization and should assist in the only.—ECA is seeking proposals to guarantee is made or implied that grants recruitment and selection of conduct an exchange program for will be awarded in all categories. participants as well as provide logistical mayors and local leaders from Kosovo. For this competition, both single support for any in-country activities. This project will support the country and multi-country projects are Activities may include training-of- development of the local government eligible for support. In order to prevent trainers sessions, in-country workshops, sector and should be designed to offer duplication of effort, proposals should initiatives to create professional practical, hands-on experiences for the reflect an understanding of the work of networks or professional associations, participants. Topics to be addressed international agencies so that projects and communication through the during the project should include complement—not duplicate—other Internet or regularly published financial management, the assistance programs. newsletters. Projects should also take implementation of national policies at Two-way exchanges will be given the into account the need for ongoing the local level, economic development, highest priority. Applicants should sharing of information, training, and infrastructure support and strategic carefully review the following concrete plans for sustainability. planning. recommendations for proposals in The project should consist of the Central and Eastern European countries. Project funding: The total funding available for the Bulgaria library following elements: To be eligible for a grant award under • exchanges is approximately $200,000. The recruitment and selection of this competition, the proposed approximately ten participants from professional training and exchange The Bureau anticipates awarding one grant under this theme. Kosovo; projects must address one of the • A U.S. component that would following specific themes, which are Judicial Reform include a three- to five-day program in listed below in two categories—Country Washington, DC, where participants Specific Programs and Regional Macedonia—Single country projects would be introduced to the U.S. system Programs. only.—Judicial reform has become of government and meet with elected increasingly important in Macedonia as Country Specific officials and representatives of local and the government, legal professionals, and regional government associations and a Library Exchange (Bulgaria only). concerned citizens recognize the need two- to three-week program in small- to Judicial Reform Project (Macedonia for a modern, efficient court system to medium-sized U.S. cities. only). keep pace with the social, economic, • In-country workshops and/or Mayors and Local Leaders Exchange and political changes in their country. consultations that reach out to a wider (Kosovo only). Legal experts note that courts in audience and provide substantive Regional Programs Macedonia are overburdened, follow-up to the U.S.-based visits. inefficient, and unresponsive to • Materials development. Media Training (Regional Program for citizens. Participants should include both Albania and Bosnia-Herzegovina and elected leaders and civil servants Bulgaria and Croatia and Macedonia This program should focus on judges and prosecutors in the Macedonian legal working at the local level. Organizations and Serbia and Montenegro). should demonstrate their ability to Prevention of Trafficking in Persons system. The primary aim of the program will be to establish a series of trainings, recruit and select candidates for (Regional Program for Albania and participation in the program and Bosnia-Herzegovina and Bulgaria and seminars and on-the-job programs in Macedonia. These programs should aim describe how these activities will be Croatia and Kosovo and Macedonia and carried out. Applicants should also Romania and Serbia and Montenegro). to strengthen the functions of prosecutors and judges; encourage identify an in-country partner Anti-corruption and Ethics (Regional institution or institutions. The partner(s) program for Latvia and Lithuania and continual reform of practices; and solidify ethical standards. ECA should be responsible for assisting in Estonia). the recruitment and selection of envisions a mix of U.S.-based trainers participants and for providing logistical Country Specific (Single Country and Macedonian-based staff support for any in-country activities. Projects Only) coordinating the program. Another The proposal submitted by your important component of the program Library Exchange organization must demonstrate how will be the inclusion of an established Bulgaria—Single country project these activities/objectives will be met. Macedonian partner organization. The only.—ECA is interested in proposals Your proposal narrative should also hope would be that the Macedonian that will enhance institutional provide detailed information on major organization would develop its own relationships between U.S. and program activities to be undertaken. Bulgarian libraries. Projects should programming and could continue to Applicants should have an focus on the practical use of new work with judges and prosecutors on its understanding of the current situation of technologies and the provision of library own after the grant program. A U.S. Kosovo, and be willing to cooperate services for citizens. The exchange based train-the-trainers component with Kosovo-based international should examine the operation of could be included for this purpose. organizations as well as the U.S. Office resource centers/small libraries, Coordination with the Public Affairs in Pristina. including strategic planning, traditional Section of the U.S. Embassy in Skopje This office is interested in proposals and electronic collection development, during the program is essential. that enhance institutional relationships cooperative management of information Project funding: The total funding and offer practical information to resources, public-oriented services, available for the Macedonia judicial individuals to assist them with their outreach, and marketing techniques. reform project is approximately professional responsibilities. The The Union of Librarians and $200,000. The Bureau anticipates projects should also take into account Information Services Officers (the awarding one grant under this theme. the need for ongoing sharing of

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information, training and concrete plans averaging approximately $180,000 each. thematic and regional expertise in the for self-sustainability. Examples There will be a total of approximately proposal. Priority will be given to include: A ‘‘train the trainers’’ model (a 40 participants funded through this programs that propose to reach high-risk program that includes practice RFGP. Each proposal should groups where anti-trafficking initiatives presentation sessions, followed by accommodate approximately 12–15 have been limited or nonexistent. activities coordinated and implemented participants and should be regional in Proposals must include a timeline for by the participants in Kosovo); support focus. ECA will consider proposals that the entire grant period, a schedule for for in-country training/resource centers; include several distinct exchanges each program activity, subcontract plans to create professional networks or during the life of the grant, but all agreements, resumes of trainers and professional associations; regularly exchange groups should include proposed personnel, and letters of published newsletters; and ongoing participants from at least three support from SEE and U.S. partners. Internet communication. countries. Proposals may address either of the Project funding: The total funding Tentative participant numbers and themes listed below. To be competitive, available for the Kosovo mayors and needs are: proposals should outline how local leaders project is approximately Albania: Four participants. English- participants will be selected. $200,000. The Bureau anticipates speakers only. Participants should be from the SEE awarding one grant under this theme. Bosnia-Herzegovina: Four countries listed above and should be participants. Two English and two non- afforded networking and information Regional Programs English speakers. sharing opportunities throughout the Media Training Bulgaria: Five participants. grant period. Priority should be given to foreign participants who have not Albania, Bosnia-Herzegovina, Croatia: Four participants. English- traveled to the U.S. previously. Bulgaria, Croatia, Macedonia, Serbia speakers only. Macedonia: Twelve participants. Six Language and interpreting issues should and Montenegro—Multi-country also be addressed in the proposal. projects for all six countries only.—The English and six non-English speakers. Serbia and Montenegro: Fourteen Applicants should expect to work Bureau is looking for proposals that will participants. Seven English and seven closely with the Public Affairs Sections provide training for journalists, editors non-English speakers. of the U.S. Embassies in SEE on and media managers. The program Once projects are funded, ECA will coordination of all activities, including should include an orientation session work with the grantees to solicit more participant selection. lasting approximately four days; an detailed information on the needs and Pursuant to the Bureau’s authorizing internship assignment of approximately interests of individual participants. legislation, programs must maintain a five weeks in a small- to medium-sized non-political character. Proposals must media organization; and a two- to three- Prevention of Trafficking in Persons in demonstrate an understanding of the day debriefing. Projects should include Southeastern Europe principles behind the Trafficking both English-speaking and non-English- Albania, Bosnia-Herzegovina, Bulgaria, Victims Protection Act of 2000 (the speaking participants; proposals should Croatia, Macedonia, Romania, Serbia ‘‘ACT’’) and current U.S. government clearly describe what provisions would and Montenegro, Kosovo—Multi- policy, as expressed through Trafficking be made for non-English speakers. ECA Country Projects for all Nine Countries/ in Persons National Security will consider proposals to shorten the Regions Only Presidential Directive of 2/2/5/03 internships assignment in order to (http://www.whitehouse.gov/news/ accommodate interpreting services for Trafficking in persons continues to be releases/2003/02/20030225.html) and non-English speakers. ECA strongly a widespread problem in Southeastern Executive Order 13257 (http:// encourages the use of locally hired Europe (SEE). In June 2002 the United nodis3.gsfc.nasa.gov/library/ interpreters. Those applicants that opt States Department of State released its displayEO.cfm?id=EO_13257 ) to find their own interpreters should second report on the issue of trafficking Areas of focus: submit a budget reflecting those costs in persons worldwide. (Please see http:/ (1) Two-way exchanges and training and should demonstrate in their /www.state.gov/g/tip/rls/tiprpt/2002/.) programs that may address public proposal narrative the ability to Many SEE countries included in the awareness, victim assistance, competently address interpreting study are classified as countries that reintegration and/or occupational requirements. have not taken adequate steps to quell training. Proposals should outline hands-on, trafficking in persons or to recognize the The Bureau is seeking two-way practical internships for the severity of the problem. The need to exchange programs that will educate the participants. A list of media educate and inform communities and U.S. and SEE citizenries on the issue of establishments willing to host the lawmakers has become imperative to trafficking. Many nongovernmental participants as well as tentative letters prevent trafficking in the SEE region. organizations (NGOs) in SEE have been of commitment should be included in The Bureau seeks proposals that confronting the issue of trafficking and the proposal. A sample program provide training to individuals and have much to share with their U.S. schedule or outline of a similar program communities in the SEE region to help counterparts. (Given that many women that the organization has conducted in combat trafficking in persons. Programs are now being trafficked into the United the past should also be submitted. should be regional in focus and should States, it is important that U.S. relief Participant Selection: Please note that include cross-border efforts to ensure and assistance organizations are the winning applicant must consult integration of efforts and cooperation exposed to effective prevention and closely with the Public Affairs Offices at among SEE countries. To avoid assistance programs in SEE.) SEE the respective U.S. embassies during duplication of initiatives, applicants participants in turn will benefit from program implementation. Embassies should be familiar with international exposure to U.S. models for job training will nominate participants for the organizations’ programs and indigenous and life skills management programs, program. SEE non governmental organizations’ peer education and economic assistance The Bureau anticipates funding no (NGO) programs to combat trafficking. programs as well as models for more than three grants for this theme, Applicants should outline relevant successful advocacy and fundraising

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campaigns on the issue. Participants Anti-Corruption and Ethics monitoring public ethics and may be leaders of NGOs, associations, corruption. Latvia, Lithuania, and Estonia (Multi- community leaders, teachers and school ECA is looking for programs that Country Project for All Three Countries include a mix of participants from administrators and local government Only) officials. Follow-up workshops/on site different governmental and non- consultations in the region are The Bureau welcomes proposals for a governmental institutions to ensure encouraged after the U.S.-based training. regional anti-corruption program, sharing of diverse experiences and build Programs may focus on developing designed to improve ethics oversight mutual understanding of common public ethics standards. Travel in both participants’ skills to establish job and management laws and procedures directions, including a hands-on, U.S.- training programs in the region, but in the Baltic States. The Baltic nations based program with a train-the-trainer funding may not be used for the continue to struggle against corruption at various levels of society. Government component, should be proposed. establishment or maintenance of officials and law enforcement are poorly Continuous communication, mentoring, victims’ assistance centers or equipment trained to recognize conflict of interest and consultations between overseas for such centers. Successful proposals issues. In addition, ethical codes of participants and trainers/mentors, will offer hands-on training, including conflict and conflict of interest should be described in detail and shadowing and internship legislation are weak. Unfortunately, conducted throughout the life of the opportunities, as well as the influence peddling and conflict of grant. Overseas, programs should be development of public awareness interest can be found at the highest conducted in the form of short courses campaigns, action plans, publications, levels. Government employees deal with and include an appropriate public web-based information and/or other low salaries; difficult working relations component (developed in products that can be accessed easily by conditions; lack of support from coordination with U.S. embassies), to the general public and the respective political leaders and senior highlight the importance of anti- SEE governments. administrators; and out-of-date corruption efforts. Proposals should (2) Training and exchanges for equipment and records. include a programming element that members of parliament (particularly Citizens have low expectations for will bring participants from all three countries together to increase the women members), ministry officials, government service and can be inclined to view bribes at low levels or program’s regional impact. government press spokespeople and Project funding: The total funding local government officials. embezzlement, conflicts of interest and bribe-taking at high levels as the norm, available for prevention of trafficking The Bureau welcomes proposals that to be tolerated rather than fought. programs is approximately $200,000. will encourage members of parliament, Education is needed for both the public The Bureau anticipates awarding one ministry officials, government press and civil servants/law enforcement on grant for this topic. spokespeople and local government what each can expect of the other. Overall Budget Guidelines officials to take an active stand against Proposals should outline a program trafficking in the SEE region. Grants awarded to eligible that will train both Baltic officials and organizations with less than four years Proposals should focus on how non-governmental personnel in of experience in conducting government should enforce and/or government ethics issues and their international exchange programs will be improve laws or national action plans respective roles in guaranteeing limited to $60,000. against trafficking. Proposals should adherence to high standards of Applicants must submit a outline a strategy on how governments government ethics. The overall comprehensive budget for the entire in the region can increase information objectives of proposed programs should program. There must be a summary sharing and close down trafficking be to improve ethics oversight and budget as well as breakdowns reflecting routes in the region. Proposals should management laws, policies, procedures both administrative and program also address specifically how training and institutions in the Baltic states; budgets. Applicants may provide will encourage cooperative and increase public confidence in separate sub-budgets for each program governmental institutions by training complementary efforts between the component, phase, location, or activity Baltic officials and non-governmental government and NGO community to provide clarification. Please refer to entities in government ethics issues as regarding the issue. U.S.-based the Solicitation Package for complete well as the role and responsibility of exchanges and follow-up workshops in budget guidelines and formatting private citizens, the media and the instructions. the region are strongly encouraged. The academic community in guaranteeing Bureau is interested in results-oriented Since Bureau grant assistance high standards of government ethics. constitutes only a portion of total proposals that include regional action Target populations for these programs project funding, proposals should list planning, publications and other work include: members of Parliament, and provide evidence of other products that will serve to educate parliament staff and law enforcement anticipated sources of financial and in- government officials and the general officers responsible for enforcing kind support. While there is no public in the SEE region regarding conflict of interest/corruption minimum requirement, applicants are trafficking. legislation, national and municipal encouraged to provide cost sharing to Project Funding officials, government and civics the fullest extent possible. State professors from universities, NGO Department Review Panels will consider The total funding available for leaders, and media representatives. cost sharing seriously when evaluating prevention of trafficking programs is Proposals should describe a program all proposals. approximately $500,000. The Bureau that engages participants in relevant The following program costs are anticipates awarding two or three ethics issues, including the role of eligible for funding consideration: proposals for this competition averaging public ethics in a democratic society, 1. Travel Costs. International and approximately $165,00–$250,000 each. ethics responsibilities for government domestic airfares (per the Fly America officials, and the role of NGOs in Act), transit costs, ground transportation

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costs, and visas for U.S. participants (J– The Bureau strongly discourages the use date but received on a later date will not 1 visas for Bureau-supported of automatic translation software for the be accepted. Each applicant must ensure participants from Eurasia to travel to the preparation of training materials or any that the proposals are received by the U.S. are issued at no charge). information distributed to the group of above deadline. 2. Per Diem. For U.S.-based participants or network of organizations. Applicants must follow all programming, organizations should use Costs for high-quality translation of instructions in the Solicitation Package. the published Federal per diem rates for materials should be anticipated and The original and twelve copies of the individual U.S. cities. For activities in included in the budget. Grantee application should be sent to: U.S. Europe/Eurasia, the Bureau strongly organizations should expect to submit a Department of State, SA–44, Bureau of encourages applicants to budget realistic copy of all program materials to the Educational and Cultural Affairs, Ref.: costs that reflect the local economy. Bureau. ECA/PE/C/EUR–03–39, Program Domestic per diem rates may be 8. Equipment. Proposals may contain Management, ECA/EX/PM, Room 534, accessed at: http:// costs to purchase equipment for Eurasia- 301 4th Street, SW., Washington, DC www.policyworks.gov/ and foreign per based programming such as computers, 20547. diem rates can be accessed at: http:// fax machines and copy machines. Costs Diversity, Freedom and Democracy www.state.gov/www/perdiems/ for furniture are not allowed. Equipment Guidelines index.html. costs must be kept to a minimum. 3. Interpreters. Local interpreters with 9. Working meal. Only one working Pursuant to the Bureau’s authorizing adequate skills and experience may be meal may be provided during the legislation, programs must maintain a used for program activities. The Bureau program. Per capita costs may not non-political character and should be strongly encourages applicants to use exceed $5–8 for a lunch and $14–20 for balanced and representative of the local interpreters. Salary costs for local a dinner, excluding room rental. diversity of American political, social, interpreters must be included in the The number of invited guests may not and cultural life. ‘‘Diversity’’ should be budget. Costs associated with using exceed participants by more than a interpreted in the broadest sense and their services may not exceed rates for factor of two-to-one. Interpreters must encompass differences including, but U.S. Department of State interpreters. be included as participants. not limited to ethnicity, race, gender, Typically, one interpreter is provided 10. Return travel allowance. A return religion, geographic location, socio- for every four visitors who require travel allowance of $70 for each foreign economic status, and physical interpreting, with a minimum of two participant may be included in the challenges. Applicants are strongly interpreters. Bureau grants do not pay budget. The allowance may be used for encouraged to adhere to the for foreign interpreters to accompany incidental expenses incurred during advancement of this principle both in delegations from their home country. international travel. program administration and in program U.S. Department of State Interpreters 11. Health Insurance. Foreign content. Please refer to the review may be used if local interpreters are not participants will be covered under the criteria under the ‘‘Support for available. Proposal budgets should terms of a Bureau-sponsored health Diversity’’ section for specific contain a flat $170/day per diem for insurance policy. The premium is paid suggestions on incorporating diversity each U.S. Department of State by the Bureau directly to the insurance into the total proposal. Public Law 104– interpreter, as well as home-program- company. Applicants are permitted to 319 provides that ‘‘in carrying out home air transportation of $400 per include costs for travel insurance for programs of educational and cultural interpreter, reimbursements for taxi U.S. participants in the budget. exchange in countries whose people do fares, plus any other transportation 12. Wire transfer fees. When not fully enjoy freedom and democracy, expenses during the program. Salary necessary, applicants may include costs ‘‘the Bureau’’ shall take appropriate expenses are covered centrally and to transfer funds to partner steps to provide opportunities for should not be part of an applicant’s organizations overseas. participation in such programs to proposed budget. 13. Administrative Costs. Costs human rights and democracy leaders of 4. Book and cultural allowance. necessary for the effective such countries.’’ Public Law 106—113 Foreign participants are entitled to a administration of the program may requires that the governments of the one-time cultural allowance of $150 per include salaries for grantee organization countries described above do not have person, plus a book allowance of $50. employees, benefits, and other direct inappropriate influence in the selection Interpreters should be reimbursed up to and indirect costs per detailed process. Proposals should reflect $150 for expenses when they escort instructions in the Application Package. advancement of these goals in their participants to cultural events. U.S. While there is no rigid ratio of program contents, to the full extent program staff, trainers or participants administrative to program costs, priority deemed feasible. will be given to proposals whose are not eligible to receive these benefits. Review Process 5. Consultants. Consultants may be administrative costs are less than used to provide specialized expertise or twenty-five (25) per cent of the total The Bureau will acknowledge receipt to make presentations. Daily honoraria requested from the Bureau. Proposals of all proposals and will review them cannot exceed $250 per day. should show strong administrative cost- for technical eligibility. Proposals will Subcontracting organizations may also sharing contributions from the be deemed ineligible if they do not fully be used, in which case the written applicant, the in-country partner and adhere to the guidelines stated herein agreement between the prospective other sources. and in the Solicitation Package. All grantee and subcontractor should be eligible proposals will be reviewed by Deadline for Proposals included in the proposal. Subcontracts the program office as well as the Public should be itemized in the budget. All proposal copies must be received Diplomacy section overseas, where 6. Room rental. Room rental may not at the Bureau of Educational and appropriate. Eligible proposals will be exceed $250 per day. Cultural Affairs by 5 p.m. Washington, subject to compliance with Federal and 7. Materials development. Proposals DC time on Friday, May 9, 2003. Faxed Bureau regulations and guidelines and may contain costs to purchase, develop documents will not be accepted at any forwarded to Bureau grant panels for and translate materials for participants. time. Documents postmarked the due advisory review. Proposals may also be

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reviewed by the Office of the Legal services, should be kept to a minimum. Support for East European Democracies Adviser or by other Department Priority will be given to proposals (SEED) Act of 1989. elements. Final funding decisions are at whose administrative costs are less than Notice the discretion of the Department of twenty-five (25) per cent of the total State’s Assistant Secretary for funds requested from the Bureau. The terms and conditions published Educational and Cultural Affairs. Final Applicants are encouraged to cost share in this RFGP are binding and may not technical authority for assistance a portion of overhead and be modified by any Bureau awards resides with the Bureau’s Grants administrative expenses. Cost-sharing, representative. Explanatory information Officer. including contributions from the provided by the Bureau that contradicts published language will not be binding. Review Criteria applicant, the in-country partner, and other sources should be included in the Issuance of the RFGP does not Technically eligible applications will budget request. constitute an award commitment on the be competitively reviewed according to 4. Support of Diversity: Proposals part of the Government. The Bureau the criteria stated below. These criteria should demonstrate substantive support reserves the right to reduce, revise, or are not rank ordered and all carry equal of the Bureau’s policy on diversity. increase proposal budgets in accordance weight in the proposal evaluation: Achievable and relevant features should with the needs of the program and the 1. Program Planning and Ability to be cited in both program administration availability of funds. Awards made will Achieve Program Objectives: Program (selection of participants, program be subject to periodic reporting and objectives should be stated clearly and venues and program evaluation) and evaluation requirements. should reflect the applicant’s expertise program content (orientation and wrap- in the subject area and region. Notification up sessions, program meetings, resource Objectives should respond to the Final awards cannot be made until materials and follow-up activities). priority topics in this announcement funds have been appropriated by Applicants should refer to the Bureau’s and should relate to the current Congress, allocated and committed conditions in the target countries. A Diversity, Freedom and Democracy through internal Bureau procedures. detailed agenda and relevant work plan Guidelines in the Proposal Submission Instructions (PSI). Dated: March 6, 2003. should explain how objectives will be C. Miller Crouch, achieved and should include a timetable 5. Follow-on Activities: Proposals should provide a plan for continued Principal Deputy Assistant Secretary, Bureau for completion of major tasks. The of Educational and Cultural Affairs, substance of workshops, internships, follow-on activity (without Bureau financial support) ensuring that Bureau Department of State. seminars and/or consulting should be [FR Doc. 03–6083 Filed 3–12–03; 8:45 am] described in detail. Sample training supported programs are not isolated BILLING CODE 4710–05–P schedules should be outlined. events. Responsibilities of in-country partners 6. Evaluation: Proposals should include a detailed plan to monitor and should be clearly described. DEPARTMENT OF STATE 2. Institutional Capacity: The evaluate the program. A draft survey proposal should include (1) the U.S. questionnaire plus a description of a [Public Notice 4296] institution’s mission and date of methodology to use to link outcomes to establishment (2) detailed information original project objectives should be Bureau of Educational and Cultural about the in-country partner included. Successful applicants will be Affairs Request for Grant Proposals: institution’s capacity and the history of expected to submit intermediate reports Fulbright Teacher and Administrator the U.S. and in-country partnership (3) after each project component concludes Exchange Program an outline of prior awards—U.S. or on a quarterly basis, whichever is less SUMMARY: The Office of Global government and private support frequent. Educational Programs of the Bureau of received for the target theme/region (4) Authority Educational and Cultural Affairs (ECA) descriptions of experienced staff announces an open competition to members who will implement the Overall grant making authority for administer the Fulbright Teacher and program. Proposed personnel and this program is contained in the Mutual Administrator Exchange Program. institutional resources should be Educational and Cultural Exchange Act Public and private non-profit adequate and appropriate to achieve the of 1961, Public Law 87–256, as organizations meeting the provisions program’s goals. The proposal should amended, also known as the Fulbright- described in Internal Revenue Code reflect the institution’s expertise in the Hays Act. The purpose of the Act is ‘‘to section 26 U.S.C. 501(c)(3) may submit subject area and knowledge of the enable the Government of the United proposals. conditions in the target country. States to increase mutual understanding Proposals should demonstrate an between the people of the United States Program Information institutional record of successful and the people of other countries * * *; Overview: The Fulbright Teacher and exchange programs, including to strengthen the ties which unite us Administrator Program provides responsible fiscal management and full with other nations by demonstrating the opportunities for elementary and compliance with all reporting educational and cultural interests, secondary teachers, administrators, and requirements for past Bureau grants as developments, and achievements of the other school or community college determined by Bureau Grant Staff. The people of the United States and other faculty to participate in direct Bureau will consider the past nations * * * and thus to assist in the exchanges of positions with colleagues performance of prior recipients and the development of friendly, sympathetic from other countries for six weeks, a demonstrated potential of new and peaceful relations between the semester, or a full academic year. applicants. United States and the other countries of The program provides a rich 3. Cost Effectiveness and Cost the world.’’ The funding authority for professional growth opportunity while Sharing: Overhead and administrative the program above is provided through enhancing mutual understanding among costs for the proposal, including legislation. The funding authority for foreign and U.S. teachers, salaries, honoraria and subcontracts for this program is provided through the administrators, their students, and host

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communities. The major program development, and creating and updating educational and cross-cultural issues components include alumni relations, handbooks. that will help prepare participants for recruitment and outreach, participant their year or semester abroad. Matching matching, orientation of U.S. and Monitoring foreign participants, administration of The cooperating agency forwards all training and professional meeting U.S. candidates who are interviewed by During the academic year, the programs of the Fall and Spring volunteer peer review committees. After cooperating agency monitors the workshops, and monitoring and that step the U.S. applicants are professional and personal well-being of evaluation protocols. The cooperating matched with foreign partners whose the foreign teachers. Staff members from agency must maintain a flexible professional and personal backgrounds the cooperating organization monitor approach in response to changing are congruent with the backgrounds of the performance of participants and program needs and priorities. Effective their American partners. For example, counsel foreign participants, if needed, and direct communications between the elementary teachers are matched with at the Fall and Spring meetings. The cooperating agency and ECA’s Teacher elementary teachers and secondary cooperating agency will staff a full-time Exchange Branch will be necessary at all school math teachers with like position solely for monitoring and times. Consequently, the cooperating professional counterparts in an eligible supporting program participants. The agency is required to have a foreign country. The cooperating agency cooperating agency consults with Washington, D.C.-based office to simultaneously forwards candidate Branch staff and provides written facilitate communication. A detailed dossiers to over 30 countries for reports on any issue that may adversely listing of responsibilities is provided in consideration. The dossiers are affect an exchange or the program in the Project Objectives, Goals, and evaluated and matched by overseas general. Implementation (POGI) document and counterparts, such as the Fulbright Other Administrative Support should be consulted in preparing the Commission, the public affairs section proposal. of the U.S. Embassy, or an in-country The cooperating agency is expected to hosting organization, depending upon provide extensive support to the Alumni Development the circumstances in country. All final Teacher and Administrator Exchange Alumni program initiatives should matches must be mutually agreed upon Program. Bi-monthly meetings, and emphasize the development of the by all U.S. and overseas counterparts. other meetings pertaining to the grant’s program’s alumni groups throughout the The Teacher Exchange Branch will play core program components, will be held United States. The cooperating agency a coordinating role in this process and between the Branch and the cooperating will provide support to individual U.S. liaise between the U.S. cooperating agency on a regular basis. The alumni and assist them in developing agency and the overseas counterpart. cooperating agency will also be their respective alumni groups. Alumni responsible for maintaining telephone, Professional Meeting Program groups may develop small projects e-mail, and fax communications with funded through this grant to enhance Regional meetings for foreign teachers appropriate Branch and ECA staff. Other the program, such as school-to-school participating in the program are held at administrative services to be provided partnerships, etc. In addition, data seven locations in the United States in by the cooperating agency include: collection and operation of a database of the Fall of each academic year and are paying stipends to and withholding grantees and alumni, with subject fields designed to stimulate the teachers to taxes for selected foreign grantees; and defined by the Branch, will be required, discuss and think through the supporting special projects. and must be compatible with the challenges of adjusting to teaching and Bureau’s Academic Exchange living in the United States In addition, Evaluation Information System dbase (AEIS). Spring meetings are held in 12 to 15 The cooperating agency will be regional sites in the United States, to responsible for developing, collecting, Recruitment and Outreach debrief the foreign teachers as well as analyzing, and disseminating means of The cooperating agency is responsible prepare them for re-entry to their home participant evaluation for workshops for recruitment of U.S. program countries. U.S. teachers selected for the and the orientation, and developing a participants (teachers and upcoming program year will also attend summative program evaluation at the administrators) through a nation-wide the Spring meetings in preparation for end of each academic year. The recruitment campaign. Selection is their overseas exchange. The evaluation of these activities will based on teachers’ and administrators’ cooperating agency will be responsible include, but not be limited to, an professional background and leadership for obtaining local administrative and assessment of the effectiveness of each potential. Foreign exchange participants program support for both Fall and of the program components and may are recruited and nominated by U.S. Spring meetings and will assist in include suggestions for program embassies or overseas Fulbright staffing a portion of the meetings. improvement and innovation. Commissions. To qualify for the program, applicants must have a Orientation Guidelines minimum of three years professional Approximately 530 U.S. and foreign Pending availability of funds, the experience, hold an equivalent full-time Fulbright Teacher Exchange Program grant will begin on October 1, 2003 and teaching position and a Bachelor’s participants and their family members will run through September 30, 2006. degree or higher, and be fluent in attend an orientation program in The administrative portion of the grant English. Washington, DC in the Summer, prior to will only cover October 1, 2003 to The cooperating agency will submit a their exchange year. The orientation September 30, 2004. U.S. program yearly recruitment and outreach plan to will provide the participants with participants will be recruited the Branch and will be responsible for opportunities to meet one-on-one prior nationwide and from the full range of all recruitment activities including to their reciprocal exchanges. The the teaching profession from primary to attendance at conferences, mass cooperating agency will organize the the community college level. The mailings of promotional materials, orientation; activities include formal cooperating agency will also provide responses to general inquires, web site presentations and workshops on support for approximately 175 foreign

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teachers and administrators from To Download a Solicitation Package Adherence to All Regulations approximately 30 countries. Contingent via Internet: The entire Solicitation Governing the J Visa upon satisfactory performance based on Package may be downloaded from the The Bureau of Educational and annual reviews, the Bureau intends to Bureau’s Web site at http:// Cultural Affairs is placing renewed renew the award each year for a period exchanges.state.gov/education/RFGPs. emphasis on the secure and proper of not less than four additional years. Please read all information before administration of Exchange Visitor (J Programs must comply with J–1 visa downloading. visa) Programs and adherence by regulations. Please refer to the grantees and sponsors to all regulations Solicitation Package for further Deadline for Proposals: All proposal information. copies must be received at the Bureau governing the J visa. Therefore, of Educational and Cultural Affairs by 5 proposals should demonstrate the Budget Guidelines p.m. Washington, DC time on May 2, applicant’s capacity to meet all The Bureau anticipates awarding one 2003. Faxed documents will not be requirements governing the grant in the amount of $2.3 million to accepted at any time. Documents administration of Exchange Visitor support program and administrative postmarked the due date but received Programs as set forth in 22 CFR 6Z, costs required to implement this on a later date will not be accepted. including the oversight of Responsible program. Bureau grant guidelines Each applicant must ensure that the Officers and Alternate Responsible require that organizations with less than proposals are received by the above Officers, screening and selection of four years experience in conducting deadline. program participants, provision of pre- arrival information and orientation to international exchanges be limited to Applicants must follow all $60,000 in Bureau funding. Therefore, participants, monitoring of participants, instructions in the Solicitation Package. proper maintenance and security of organizations that cannot demonstrate at The original and eight copies of the least four years experience in forms, record-keeping, reporting and application should be sent to: U.S. conducting international exchanges are other requirements. The Grantee will be Department of State, SA–44, Bureau of ineligible to apply under this responsible for issuing DS–2019 forms Educational and Cultural Affairs, Ref.: competition. The Bureau encourages to participants in this program. applicants to provide maximum levels ECA/A/S/X–04–01, Program A copy of the complete regulations of cost-sharing and funding from private Management, ECA/EX/PM, Room 534, governing the administration of sources in support of its programs. 301 4th Street, SW., Washington, DC Exchange Visitor (J) programs is Applicants must submit a 20547. available at http://exchanges.state.gov comprehensive budget for the entire Diversity, Freedom and Democracy or from: United States Department of program. There must be a summary Guidelines State, Office of Exchange Coordination budget as well as breakdowns reflecting and Designation, ECA/EC/ECD—SA–44, both administrative and program Pursuant to the Bureau’s authorizing Room 734, 301 4th Street, SW., budgets. Applicants may provide legislation, programs must maintain a Washington, DC 20547, Telephone: separate sub-budgets for each program non-political character and should be (202) 401–9810, FAX: (202) 401–9809. component, phase, location, or activity balanced and representative of the Review Process to provide clarification. Please refer to diversity of American political, social, the Solicitation Package for complete and cultural life. ‘‘Diversity’’ should be The Bureau will acknowledge receipt budget guidelines and formatting interpreted in the broadest sense and of all proposals and will review them instructions. encompass differences including, but for technical eligibility. Proposals will Announcement Title and Number: All not limited to ethnicity, race, gender, be deemed ineligible if they do not fully correspondence with the Bureau religion, geographic location, socio- adhere to the guidelines stated herein concerning this RFGP should reference economic status, and physical and in the Solicitation Package. All the above title and number ECA/A/S/X– challenges. Applicants are strongly eligible proposals will be reviewed by 04–01. encouraged to adhere to the the program office and will be subject to FOR FURTHER INFORMATION CONTACT: The advancement of this principle both in compliance with Federal and Bureau Office of Global Educational Programs, program administration and in program regulations and guidelines and ECA/A/S/X, Room Number 349, U.S. content. Please refer to the review forwarded to Bureau grant panels for Department of State, SA–44, 301 4th criteria under the ’Support for Diversity’ advisory review. Proposals may also be Street, SW., Washington, DC 20547, 202 section for specific suggestions on reviewed by the Office of the Legal 619–4555 or fax 202 401-1433, incorporating diversity into the total Adviser or by other Department [email protected] to request a proposal. Public Law 104–319 provides elements. Final funding decisions are at Solicitation Package. The Solicitation the discretion of the Department of that ‘‘in carrying out programs of Package contains detailed award State’s Assistant Secretary for educational and cultural exchange in criteria, required application forms, Educational and Cultural Affairs. Final countries whose people do not fully specific budget instructions, and technical authority for assistance enjoy freedom and democracy,’’ the standard guidelines for proposal awards cooperative agreement resides Bureau ‘‘shall take appropriate steps to preparation. Please specify Bureau with the Bureau’s Grants Officer. provide opportunities for participation Senior Program Officer Mary Lou in such programs to human rights and Review Criteria Johnson-Pizarro on all other inquiries democracy leaders of such countries.’’ and correspondence. Technically eligible applications will Please read the complete Federal Public Law 106—113 requires that the be competitively reviewed according to Register announcement before sending governments of the countries described the criteria stated below. These criteria inquiries or submitting proposals. Once above do not have inappropriate are not rank ordered and all carry equal the RFGP deadline has passed, Bureau influence in the selection process. weight in the proposal evaluation: staff may not discuss this competition Proposals should reflect advancement of 1. Quality and Clarity of the Program with applicants until the proposal these goals in their program contents, to planning: Proposals should exhibit review process has been completed. the full extent deemed feasible. originality, substance, precision, and

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relevance to the Bureau’s mission. with other nations by demonstrating the Press of business and recent weather Detailed agenda and relevant work plan educational and cultural interests, delays and closing has been the cause of should demonstrate substantive developments, and achievements of the short notice. undertakings and logistical capacity. people of the United States and other Dated: March 7, 2003. Agenda and plan should adhere to the nations * * * and thus to assist in the Marian Gordon, program overview and guidelines development of friendly, sympathetic described above. Director, Telecommunication Development, and peaceful relations between the Department of State. 2. Support of Diversity: Proposals United States and the other countries of [FR Doc. 03–6082 Filed 3–12–03; 8:45 am] should demonstrate substantive support the world.’’ The funding authority for of the Bureau’s policy on diversity. the program above is provided through BILLING CODE 4710–45–P Achievable and relevant features should legislation. be cited in both program administration (selection of participants, program Notice OFFICE OF THE UNITED STATES venue and evaluation) and program The terms and conditions published TRADE REPRESENTATIVE content (orientation, workshops and in this RFGP are binding and may not wrap-up sessions, resource materials be modified by any Bureau Trade Policy Staff Committee; Initiation and follow-up activities). representative. Explanatory information of Environmental Review of Australia 3. Ability to achieve program provided by the Bureau that contradicts Free Trade Negotiations; Public objectives: Objectives should be published language will not be binding. Comments on Scope of Environmental reasonable, feasible, and flexible. Issuance of the RFGP does not Review Proposals should clearly demonstrate constitute an award commitment on the AGENCY: Office of the United States how the institution will meet the part of the Government. The Bureau Trade Representative. program’s objectives and plan. reserves the right to reduce, revise, or 4. Institutional Capacity: Proposed ACTION: Notice and request for increase proposal budgets in accordance comments. personnel and institutional resources with the needs of the program and the should be adequate and appropriate to availability of funds. Awards made will SUMMARY: This publication gives notice achieve the program or project’s goals. be subject to periodic reporting and that, pursuant to the Trade Act of 2002, Proposals should demonstrate an evaluation requirements. and consistent with Executive Order institutional record of successful 13141 (64 FR 63169) (Nov. 18, 1999) program planning and implementation, Notification and its implementing guidelines (65 FR including responsible fiscal Final awards cannot be made until 79442), the Office of the United States management and full compliance with funds have been appropriated by Trade Representative (USTR), through all reporting requirements. Congress, allocated and committed the Trade Policy Staff Committee 5. Project Evaluation: Proposals through internal Bureau procedures. (TPSC), is initiating an environmental should include a plan to evaluate the review of the proposed United States- activity’s success, both as the activities Dated: March 5, 2003. C. Miller Crouch, Australia Free Trade Agreement. The unfold and at the end of the program. A TPSC is requesting written comments draft survey questionnaire or other Principal Deputy Assistant Secretary, Bureau of Educational and Cultural Affairs, from the public on what should be technique plus description of a included in the scope of the methodology to use to link outcomes to Department of State. [FR Doc. 03–5762 Filed 3–12–03; 8:45 am] environmental review, including the original project objectives are potential environmental effects that BILLING CODE 4710–05–P recommended. Successful applicants might flow from the free trade will be expected to submit intermediate agreement and the potential reports after each project component is DEPARTMENT OF STATE implications for U.S. environmental concluded or quarterly, whichever is laws and regulations, and identification less frequent. [Public Notice 4270] of complementarities between trade and 6. Cost-effectiveness and Cost-sharing: environmental objectives such as the The overhead and administrative Notice of Meeting: United States promotion of sustainable development. components of the proposal, including International Telecommunication The TPSC also welcomes public views salaries and honoraria, should be kept Advisory Committee Preparations for on appropriate methodologies and as low as possible. All other items ITU Development Sector Meetings sources of data for conducting the should be necessary and appropriate. The Department of State announces review. Persons submitting written Proposals should maximize cost sharing comments should provide as much through other private sector support as meetings of the U.S. International Telecommunication Advisory detail as possible on the degree to which well as institutional direct funding the subject matter they propose for contributions. Committee (ITAC). The purpose of the Committee is to advise the Department inclusion in the review may raise Authority on policy, technical and operational significant environmental issues in the Overall grant making authority for issues with respect to international context of the negotiation. this program is contained in the Mutual telecommunications standardization DATES: Public comments should be Educational and Cultural Exchange Act bodies such as the International received no later than April 30, 2003. of 1961, Public Law 87–256, as Telecommunication Union. The ITAC ADDRESSES: Submissions by electronic amended, also known as the Fulbright- for ITU–T Study Group 3 will meet from mail: [email protected]. Hays Act. The purpose of the Act is ‘‘to 2–4 pm March 19 at the Federal Submissions by facsimile: Gloria enable the Government of the United Communications Commission; ITAC for Blue, Executive Secretary, Trade Policy States to increase mutual understanding ITU–T TSAG will meet March 26 from Staff Committee, at (202) 395–6143. between the people of the United States 9:30–4 pm at INTELSAT (3400 FOR FURTHER INFORMATION CONTACT: For and the people of other countries * * *; International Drive, NW., Washington, procedural questions concerning public to strengthen the ties which unite us DC, 7th Floor. comments, contact Gloria Blue,

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Executive Secretary, TPSC, Office of the help facilitate consideration of scheduled at least 48 hours in advance USTR, 1724 F Street, NW., Washington, appropriate responses where impacts and may be made by calling (202) 395– DC 20508, telephone (202) 395–3475. are identified. Reviews address 6186. Questions concerning the potential environmental impacts of the USTR also welcomes and will take environmental review should be proposed agreement and potential into account the public comments on addressed to David J. Brooks, implications for environmental laws Australia FTA environmental issues Environment and Natural Resources and regulations. The focus of the review submitted in response to a previous Section, USTR, telephone (202) 395– is on impacts in the United States, notice—the Federal Register notice 7320. although global and transboundary dated December 12, 2002 (67 FR impacts may be considered, where 76431)—requesting comments from the SUPPLEMENTARY INFORMATION: appropriate and prudent. public to assist USTR in formulating 1. Background Information positions and proposals with respect to 3. Requirements for Submissions all aspects of the negotiations, including On November 13, 2002, in accordance In order to facilitate prompt environmental issues. These comments with section 2104(a)(1) of the Trade Act processing of submissions, USTR will also be made available for public of 2002, the Untied States Trade strongly urges and prefers electronic (e- inspection. Representative, Ambassador Robert B. mail) submissions in response to this General information concerning the Zoellick, notified Congress of the notice. Office of the United States Trade President’s intent to enter into trade Persons making submission by e-mail Representative may be obtained by negotiations with Australia. should use the following subject line: accessing its Internet website (http:// Ambassador Zoellick outlined specific ‘‘United States—Australia FTA www.ustr.gov). U.S. objectives for these negotiations in Environmental Review’’ followed by the notification letters to Congress. ‘‘Written Comments.’’ Documents Carmen Suro-Bredie, Copies of the letters are available at should be submitted as either Chair, Trade Policy Staff Committee. http://www.ustr.gov/releases/2002/11/ WordPerfect, MSWord, or text (.TXT) [FR Doc. 03–5990 Filed 3–12–03; 8:45 am] 2002-11-13-australia-hastert.PDF and files. Supporting documentation BILLING CODE 3190–01–M http://ww.ustr.gov/releases/2002/11/ submitted as spreadsheets are 2002-11-13-australia-byrd.PDF). acceptable as Quattro Pro or Excel. For The TPSC invited the public to any document containing business OFFICE OF THE UNITED STATES provide written comments and/or oral confidential information submitted TRADE REPRESENTATIVE testimony at a public hearing that took electronically, the file name of the Trade Policy Staff Committee; Initiation place on January 15, 2003, to assist business confidential version should of Environmental Review of Free Trade USTR in amplifying and clarifying begin with the characters ‘‘BC-’’, and the Negotiations with the Southern African negotiating objectives for the proposed file name of the public version should Customs Union; Public Comments on FTA and to provide advice on how begin with the characters ‘‘P-’’. The Scope of Environmental Review specific goods and services and other ‘‘P-’’ or ‘‘BC-’’ should be followed by the matters should be treated under the name of the submitter. Persons who AGENCY: Office of the United States proposed agreement (67 FR 76431). make submissions by e-mail should not Trade Representative. Two-way trade between the United provide separate cover letters; ACTION: Notice and request for States and Australia has grown information that might appear in a cover comments. significantly in the past decade, and letter should be included in the totaled more than $19 billion in 2001. submission itself. To the extent SUMMARY: This publication gives notice The increased access to Australia’s possible, any attachments to the that, pursuant to the Trade Act of 2002, market that an FTA would provide submission should be included in the and consistent with Executive Order would further boost trade in both goods same file as the submission itself, and 13141 (64 FR 63169) (Nov. 18, 1999) and services, enhancing employment not as separate files. and its implementing guidelines (65 FR opportunities in both countries. An FTA Written comments submitted in 79442), the Office of the United States also would encourage additional foreign response to this request will be placed Trade Representative (USTR), through investment between the United States in a file open to public inspection the Trade Policy Staff Committee and Australia. A free trade agreement pursuant to 15 CFR 2003.5, except (TPSC), is initiating an environmental with Australia would further deepen the business confidential information review of the proposed United States- already close cooperation between the exempt from public inspection in Southern African Customs Union Free United States and Australia in accordance with 15 CFR 2003.6. Trade Agreement (U.S–SACU FTA). The advancing objectives for multilateral Business confidential information TPSC is requesting written comments negotiations currently underway in the submitted in accordance with 15 CFR from the public on what should be World Trade organization (WTO). 2003.6 must be clearly marked included in the scope of the ‘‘BUSINESS CONFIDENTIAL’’ at the top environmental review, including the 2. Environmental Review of each page, including any cover letter potential environmental effects that USTR, through the TPSC, will or cover page, and must be accompanied might flow from the free trade perform an environmental review of the by a nonconfidential summary of the agreement and the potential agreement pursuant to the Trade Act of confidential information. All public implications for U.S. environmental 2002 and consistent with Executive documents and nonconfidential laws and regulations, and identification Order 13141 (64 FR 63169) and its summaries shall be available for public of complementarities between trade and implementing guidelines (65 FR 79442). inspection in the USTR Reading Room. environmental objectives such as the Environmental reviews are used to The USTR Reading Room is open to the promotion of sustainable development. identify potentially significant, public, by appointment only, from 10 The TPSC also welcomes public views reasonable foreseeable environmental a.m. to 12 noon and 1 p.m. to 4 p.m., on appropriate methodologies and impacts (both positive and negative), Monday through Friday. An sources of data for conducting the and information from the review can appointment to review the file must be review. Persons submitting written

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comments should provide as much Leading U.S. exports to SACU include pursuant to 15 CFR 2003.5, except detail as possible on the degree to which machinery and equipment, aircraft, business confidential information the subject matter they propose for vehicles, chemicals, plastics and exempt from public inspection in inclusion in the review may raise agricultural products. Leading U.S. accordance with 15 CFR 2003.6. significant environmental issues in the imports from SACU include vehicles, Business confidential information context of the negotiation. minerals, precious stones and metals, submitted in accordance with 15 CFR DATE: Public comments should be iron and steel products, and apparel. 2003.6 must be clearly marked received no later than April 30, 2003. 2. Environmental Review ‘‘BUSINESS CONFIDENTIAL’’ at the top ADDRESSES: Submissions by electronic of each page, including any cover letter USTR, through the TPSC, will mail: or cover page, and must be accompanied [email protected]. perform an environmental review of the by a nonconfidential summary of the Submissions by facsimile: Gloria Blue, agreement pursuant to the Trade Act of confidential information. All public Executive Secretary, Trade Policy Staff 2002 and consistent with Executive documents and nonconfidential Committee, at (202) 395–6143. Order 13141 (64 FR 63169) and its summaries shall be available for public implementing guidelines (65 FR 79442). FOR FURTHER INFORMATION CONTACT: inspection in the USTR Reading Room. For Environmental reviews are used to procedural questions concerning public The USTR Reading Room is open to the identify potentially significant, public, by appointment only, from 10 comments, contact Gloria Blue, reasonably foreseeable environmental Executive Secretary, TPSC, Office of the a.m. to 12 noon and 1 p.m. to 4 p.m., impacts (both positive and negative), Monday through Friday. An USTR, 1724 F Street, NW., Washington, and information from the review can DC 20508, telephone (202) 395–3475. appointment to review the file must be help facilitate consideration of scheduled at least 48 hours in advance Questions concerning the appropriate responses where impacts environmental review should be and may be made by calling (202) 395– are identified. Reviews address 6186. addressed to David J. Brooks, potential environmental impacts of the Environment and Natural Resources USTR also welcomes and will take proposed agreement and potential into account the public comments on Section, USTR, telephone (202) 395– implications for envionmental laws and 7320. U.S.–SACU FTA environmental issues regulations. The focus of the review is submitted in response to a previous SUPPLEMENTARY INFORMATION: on impacts in the United States, notice—the Federal Register notice although global and transboundary 1. Background dated November 15, 2002 (67 FR impacts may be considered, where 69295)—requesting comments from the On November 4, 2002, in accordance appropriate and prudent. with section 2104(a)(1) of the Trade Act public to assist USTR in formulating of 2002, the United States Trade 3. Requirements for Submissions positions and proposals with respect to Representative, Ambassador Robert B. In order to facilitate prompt all aspects of the negotiations, including Zoellick, notified Congress of the processing of submissions, USTR environmental issues. These comments President’s intent to enter into trade strongly urges and prefers electronic (e- will also be made available for public negotiations with the member nations of mail) submissions in response to this inspection. the Southern African Customs Union notice. General information concerning the (SACU): Botswana, Lesotho, Namibia, Persons making submissions by e- Office of the United States Trade South Africa, and Swaziland. mail should use the following subject Representative may be obtained by Ambassador Zoellick outlined specific line: ‘‘U.S.–SACU FTA Environmental accessing its Internet website (http:// U.S. objectives for these negotiations in Review’’ followed by ‘‘Written www.ustr.gov). the notification letters to Congress. Comments.’’ Documents should be Carmen Suro-Bredie, Copies of the letters are available at submitted as either WordPerfect, Chair, Trade Policy Staff Committee. http://www.ustr.gov/releases/2002/11/ MSWord, or text (.TXT) files. [FR Doc. 03–5991 Filed 3–12–03; 8:45 am] Supporting documentation submitted as 2002–11–04–SACU–byrd.PDF and http:/ BILLING CODE 3190–01–P /www.ustr.gov/releases/2002/11/2002– spreadsheets are acceptable as Quattro 11–04–SACU–hastert.PDF. Pro or Excel. For any document The TPSC invited the public to containing business confidential DEPARTMENT OF THE TREASURY provide written comments and/or oral information submitted electronically, testimony at a public hearing that took the file name of the business Treasury Advisory Committee on place on December 16, 2002, to assist confidential version should begin with Commercial Operations of the U.S. USTR in amplifying and clarifying the characters ‘‘BC-’’, and the file name Customs Service negotiating objectives for the proposed of the public version should begin with FTA and to provide advice on how the characters ‘‘P-’’. The ‘‘P-’’ or ‘‘BC-’’ AGENCY: Departmental Offices, Treasury. specific goods and services and other should be followed by the name of the ACTION: Notice of meeting and matters should be treated under the submitter. Persons who make announcement of membership. proposed agreement (67 FR 69295). submissions by e-mail should not A free trade agreement with SACU provide separate cover letters; SUMMARY: This notice announces the would deepen economic and political information that might appear in a cover date, time, and location for the second ties to sub-Saharan Africa and lend letter should be included in the meeting of the eighth term of the momentum to development efforts for submission itself. To the extent Treasury Advisory Committee on the region. SACU is the largest U.S. possible, any attachments to the Commercial Operations (COAC), and export market in sub-Saharan Africa, submission should be included in the the provisional agenda for consideration accounting for approximately $3.1 same file as the submission itself, and by the Committee. billion in exports in 2001. Total two- not as separate files. DATES: The next meeting of the Treasury way trade in goods between the United Written comments submitted in Advisory Committee on Commercial States and the member countries of response to this request will be placed Operations of the U.S. Customs Service SACU totaled $7.9 billion in 2001. in a file open to public inspection will be held on Friday, April 4, 2003, at

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9 a.m. at the U.S. Customs Service, in reference copies of the Treasury Circular FOR FURTHER INFORMATION CONTACT: the Ronald Reagan Building, located at 570, 2002 Revision, on page 44299 to Surety Bond Branch at (202) 874–1033. 13th Street and Pennsylvania Avenue, reflect this addition: The American SUPPLEMENTARY INFORMATION: Notice is NW., Washington, DC. (Main entrance Road Insurance Company. Business hereby given that the Certificate of off of 14th Street) The duration of the Address: The American Road, Dearborn, Authority issued by the Treasury to the meeting will be approximately four MI 48121–6027. Phone: (313) 337–1102. above named Company, under the hours, starting at 9 a.m. Underwriting Limitation b/: United States Code, title 31, sections FOR FURTHER INFORMATION CONTACT: $26,143,000. Surety Licenses c/: AL, 9304–9308, to qualify as an acceptable Robyn Day at 202–927–1440. AK, AZ, AR, CA, CO, DE, DC, FL, GA, reinsurer on Federal bonds is At this meeting, the Advisory ID, IL, IN, IA, LA, ME, MD, MI, MN, MS, terminated effective today. Committee is expected to pursue the MO, MT, NE, NV, NJ, NM, NY, NC, ND, The Company was last listed as an following agenda. The agenda may be OH, OK, OR, PA, RI, SC, SD, TN, TX, acceptable reinsurer on Federal bonds at modified prior to the meeting. UT, VT, VA, WA, WV, WI. Incorporated 67 FR 44336, July 1, 2002. In: Michigan. With respect to any bonds currently Agenda: (1) Customs Business Certificates of Authority expire on in force with above listed Company, (2) Customs Trade Partnership Against June 30 each year, unless revoked prior bond-approving officers should secure Terrorism, 24-hr. Manifest Rules, to that date. The Certificates are subject new bonds with acceptable reinsurers in Customs Structure in Department of to subsequent annual renewal as long as those instances where a significant Homeland Security the companies remain qualified (31 CFR amount of liability remains outstanding. (3) Merchandise Processing Fee; Proper part 223). A list of qualified companies In addition, in no event, should bonds Deduction of Freight & Other Costs is published annually as of July 1 in that are continuous in nature be from Customs Value Treasury Department Circular 570, with renewed. (4) OR&R details as to underwriting limitations, The Circular may be viewed and (5) Committee Administration areas in which licensed to transact downloaded through the Internet at (6) Agenda Items for Next Meeting surety business and other information. http://www.fms.treas.gov/c570/ index.html. A hard copy may be SUPPLEMENTARY INFORMATION: The The Circular may be viewed and purchased from the Government meeting is open to the public; however, downloaded through the Internet at Printing Office (GPO), Subscription participation in the Committee’s http://www.fms.treas.gov/c570/ Service, Washington, DC, telephone deliberations is limited to Committee index.html. A hard copy may be (202) 512–1800. When ordering the members, Customs and Treasury purchased from the Government Circular from GPO, use the following Department staff, and persons invited to Printing Office (GPO) Subscription stock number: 769–004–04067–1. attend the meeting for special Service, Washington, DC, telephone Questions concerning this notice may presentations. A person other than an (202) 512–1800. When ordering the be directed to the U.S. Department of Advisory Committee member who Circular from GPO, use the following the Treasury, Financial Management wishes to attend the meeting should stock number: 769–004–04067–1. Service, Financial Accounting and contact Robyn Day for pre-clearance. Questions concerning this notice may Services Division, Surety Bond Branch, be directed to the U.S. Department of Dated: March 7, 2003. 3700 East-West Highway, Room 6F07, the Treasury, Financial Management Timothy E. Skud, Hyattsville, MD 20782. Service, Financial Accounting and Deputy Assistant Secretary. Services Division, Surety Bond Branch, Dated: February 26, 2003. [FR Doc. 03–6050 Filed 3–12–03; 8:45 am] 3700 East-West Highway, Room 6F04, Judith R. Tillman, BILLING CODE 4810–25–P Hyattsville, MD 20782. Assistant Commissioner, Financial Operations, Financial Management Service. Dated: March 4, 2003. [FR Doc. 03–5964 Filed 3–12–03; 8:45 am] DEPARTMENT OF THE TREASURY Wanda J. Rogers, BILLING CODE 4810–35–M Director, Financial Accounting and Services Fiscal Service Division, Financial Management Service. [FR Doc. 03–5960 Filed 3–12–03; 8:45 am] Surety Companies Acceptable on DEPARTMENT OF THE TREASURY BILLING CODE 4810–35–M Federal Bonds: the American Road Fiscal Service Insurance Company AGENCY: Financial Management Service, DEPARTMENT OF THE TREASURY Surety Companies Acceptable on Fiscal Service, Department of the Federal Bonds: Termination—Markel Fiscal Service Treasury. Insurance Company ACTION: Notice. Surety Companies Acceptable on AGENCY: Financial Management Service, Federal Bonds: Termination—Gerling Fiscal Service, Department of the SUMMARY: This is Supplement No. 10 to Global Reinsurance Corporation of Treasury. the Treasury Department Circular 570; America ACTION: Notice. 2002 Revision, published July 1, 2002, at 67 FR 44294. AGENCY: Financial Management Service, SUMMARY: This is Supplement No. 7 to FOR FURTHER INFORMATION CONTACT: Fiscal Service, Department of the the Treasury Department Circular 570; Surety Bond Branch at (202) 874–6765. Treasury. 2002 Revision, published July 1, 2002, at 67 FR 44294. SUPPLEMENTARY INFORMATION: A ACTION: Notice. Certificate of Authority as an acceptable FOR FURTHER INFORMATION CONTACT: surety on Federal bonds is hereby SUMMARY: This is Supplement No. 6 to Surety Bond Branch at (202) 874–6696. issued to the following Company under the Treasury Department Circular 570; SUPPLEMENTARY INFORMATION: Notice is 31 U.S.C. 9304 to 9308. Federal bond- 2002 Revision, published July 1, 2002, hereby given that the Certificate of approving officers should annotate their at 67 FR 44294. Authority issued by the Treasury to the

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above named Company, under the reflect this addition: Company Name: SUPPLEMENTARY INFORMATION: A United States Code, title 31, sections Star insurance Company. Business Certificate of Authority as an acceptable 9304–9308, to qualify as an acceptable Address: 26600 Telegraph Road; surety on Federal bonds is hereby surety on Federal bonds is terminated Southfield, MI 48034. Phone: (248) 358– issued to the following Company under effective today. 1100. Underwriting Limitation b/: 31 U.S.C. 9304 to 9308. Federal bond- The Company was last listed as an $1,008,000. Surety Licenses c/: AL, AK, approving officers should annotate their acceptable surety on Federal bonds at 67 AZ, AR, CA, CO, CT, DE, DC, FL, GA, reference copies of the Treasury Circular FR 44317, July 1, 2002. HI, ID, IL, IN, IA, KS, KY, LA, ME, MD, 570, 2002 Revision, on page 44331 to With respect to any bonds currently MA, MI, MN, MS, MO, MT, NE, NV, reflect this addition: Company Name: in force with above listed Company, NH, NJ, NM, NY, NC, ND, OH, OK, OR, U.S. Speciality Insurance Company. bond-approving officers may let such PA, RI, SC, SD, TN, TX, UT, VT, VA, Business Address: 13403 Northwest bonds run to expiration and need not WA, WV, WI, WY. Incorporated in: Freeway, Houston, TX 77040–6006. secure new bonds. However, no new Michigan. Phone: (713) 744–3700. Underwriting bonds should be accepted from the Certificates of Authority expire on Limitation b/: $5,433,000. Surety Company. In addition, bonds that are June 30 each year, unless revoked prior Licenses c/: AL, AK, AR, CO, DC, HI, ID, continuous in nature should not be to that date. The Certificates are subject IL, KS, KY, LA, MS, MO, MT, NV, NM, renewed. to subsequent annual renewal as long as NY, ND, OK, SD, TN, TX, VT, WA, WV, The Circular may be viewed and the companies remain qualified (31 CFR WY. Incorporated In: Texas. downloaded through the Internet at part 223). A list of qualified companies Certificates of Authority expire on http://www.fms.treas.gov/c570. A hard is published annually as of July 1 in June 30 each year, unless revoked prior copy may be purchased from the Treasury Department Circular 570, with to that date. The Certificates are subject Government Printing Office (GPO), details as to underwriting limitations, to subsequent annual renewal as long as Subscription Service, Washington, DC, areas in which licensed to transact the companies remain qualified (31 CFR telephone (202) 512–1800. When surety business and other information. part 223). A list of qualified companies ordering the Circular from GPO, use the The Circular may be viewed and is published annually as of July 1 in following stock number: 769–004– downloaded through the Internet at Treasury Department Circular 570, with 04067–1. http://www.fms.treas.gov/c570. A hard details as to underwriting limitations, Questions concerning this notice may copy may be purchased from the areas in which licensed to transact be directed to the U.S. Department of Government Printing Office (GPO) surety business sand other information. the Treasury, Financial Management Subscription Service, Washington, DC, The Circular may be viewed and Service, Financial Accounting and Telephone (202) 512–1800. When downloaded through the Internet at Services Division, Surety Bond Branch, ordering the Circular from GPO, use the http://www.fms.treas.gov/c570. A hard 3700 East-West Highway, Room 6F07, following stock number: 769–004– copy may be purchased from the Hyattsville, MD 20782. 04067–1. Government Printing Office (GPO) Dated: February 26, 2003. Questions concerning this Notice may Subscription Service, Washington, DC, Wanda J. Rogers, be directed to the U.S. Department of Telephone (202) 512–1800. When Director, Financial Accounting and Services the Treasury, Financial Management ordering the Circular from GPO, use the Division, Financial Management Service. Service, Financial Accounting and following stock number: 769–004– [FR Doc. 03–5963 Filed 3–12–03; 8:45 am] Services Division, Surety Bond Branch, 04067–1. BILLING CODE 4810–35–M 3700 East-West Highway, Room 6F07, Questions concerning this notice may Hyattsville, MD 20781. be directed to the U.S. Department of the Treasury, Financial Management Dated: February 21, 2003. DEPARTMENT OF THE TREASURY Service, Financial Accounting and Wanda Rogers, Services Division, Surety Bond Branch, Fiscal Service Director, Financial Accounting and Services 3700 East-West Highway, Room 6F07, Division, Financial Management Service. Hyattsville, MD 20782. Surety Companies Acceptable on [FR Doc. 03–5962 Filed 3–12–03; 8:45 am] Dated: February 21, 2003 Federal Bonds: Star Insurance BILLING CODE 4910–35–M Company Wanda J. Rogers, Director, Financial Accounting and Services AGENCY: Financial Management Service, DEPARTMENT OF THE TREASURY Division, Financial Management Service. Fiscal Service, Department of the [FR Doc. 03–5961 Filed 3–12–03; 8:45 am] Treasury. Fiscal Service BILLING CODE 4810–35–M ACTION: Notice. Surety Companies Acceptable on SUMMARY: This is Supplement No. 8 to Federal Bonds: U.S. Specialty the Treasury Department Circular 570; Insurance Company DEPARTMENT OF VETERANS 2002 Revision, published July 1, 2002, AFFAIRS at 67 FR 44294. AGENCY: Financial Management Advisory Committee on Prosthetics FOR FURTHER INFORMATION CONTACT: Services, Fiscal Service, Department of and Special Disabilities Programs; Surety Bond Branch at (202) 874–7102. the Treasury. Notice of Meeting SUPPLEMENTARY INFORMATION: A ACTION: Notice Certificate of Authority as an acceptable The Department of Veterans Affairs surety on Federal bonds is hereby SUMMARY: This is Supplement No. 9 to (VA) gives notice under Public Law 92– issued to the following Company under the Treasury Department Circular 570; 463 that a meeting of the Advisory 31 U.S.C. 9304 to 9308. Federal bond- 2002 Revision, published July 1, 2002, Committee on Prosthetics and Special approving officers should annotate their at 67 FR 44294. Disabilities Programs will be held April reference copies of the Treasury Circular FOR FURTHER INFORMATION CONTACT: 8–9, 2003, at VA Headquarters, 810 570, 2002 Revision, on page 44328 to Surety Bond Branch at (202) 874–7116. Vermont Avenue, NW., Washington,

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DC. The meeting will be held in Room blind rehabilitation, prosthetics, DEPARTMENT OF VETERANS 430 on both days. Meeting sessions will audiology and speech pathology. AFFAIRS convene at 8:30 a.m. on both days and Additional briefing will be provided by will adjourn at 4:30 p.m. on April 8 and the program directors of ophthalmology VA Fleet Alternative Fuel Vehicle (AFV) at 12 noon on April 9. The meeting is and optometry. On the morning of April Program Report open to the public. 9, the Committee will be briefed by the The purpose of the Committee is to Director of the Rehabilitation Research AGENCY: Department of Veterans Affairs. and Development Service and will advise the Department on its prosthetic ACTION: Notice. programs designed to provide state-of- review the most recent report on the-art prosthetics and the associated maintaining treatment capacity in VA’s SUMMARY: In accordance with the Energy rehabilitation research, development, special disability programs. Policy Act of 1992 (EPAct) (42 U.S.C. and evaluation of such technology. The No time will be allocated for receiving 13211–13219) as amended by the Committee also advises the department oral presentations from the public. on special disability programs which are However, members of the public may Energy Conservation Reauthorization defined as any program administered by direct questions or submit written Act of 1998 (Pub. L. 105–388), the the Secretary to serve veterans with statements for review by the Committee Department of Veterans Affairs’ annual spinal cord injury, blindness or vision in advance of the meeting to Ms. alternative fuel reports are available on impairment, loss of or loss of use of Cynthia Wade, Veterans Health the following Department of Veterans extremities, deafness or hearing Administration, Patient Care Services, Affairs Web site: http://www.va.gov/afv. impairment, or other serious Rehabilitation Strategic Healthcare Group (117), Department of Veterans FOR FURTHER INFORMATION CONTACT: incapacities in terms of daily life Elaine Jackson, (202) 273–5859. functions. Affairs, 810 Vermont Avenue, NW., Washington, DC 20420. Any member of Approved: March 3, 2003. On the morning of April 8, the the public wishing to attend the meeting Anthony J. Principi, Committee will receive briefings by the should contact Ms. Wade at (202) 273– Secretary of Veterans Affairs. Chief Consultant, Rehabilitation 8485. Strategic Healthcare Group, and the [FR Doc. 03–6098 Filed 3–12–03; 8:45 am] Dated: March 6, 2003. Director, Capital Asset Realignment for BILLING CODE 8320–01–P Enhanced Services (CARES) Program. In E. Phillip Riggin, the afternoon, the Committee will be Committee Management Officer. briefed by the directors of VA’s special [FR Doc. 03–6100 Filed 3–12–03; 8:45 am] disability programs—spinal cord injury, BILLING CODE 8320–01–M

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Corrections Federal Register Vol. 68, No. 49

Thursday, March 13, 2003

This section of the FEDERAL REGISTER §103.140 [Corrected] Wednesday, March 5, 2003, make the contains editorial corrections of previously On page 8486, in §103.140, in the first following correction: published Presidential, Rule, Proposed Rule, column, in paragraph (d), in the fifth On page 10420, in the second column, and Notice documents. These corrections are line, ‘‘ May 22, 2003’’ should read, the subject heading is corrected to read prepared by the Office of the Federal as set forth above. Register. Agency prepared corrections are ‘‘[Insert date that is 90 days after the issued as signed documents and appear in date on which the final regulation to [FR Doc. C3–5116 Filed 3–12–03; 8:45 am] the appropriate document categories which this notice of proposed BILLING CODE 1505–01–D elsewhere in the issue. rulemaking relates is published in the Federal Register]’’. [FR Doc. C3–4171 Filed 3–12–03; 8:45 am] DEPARTMENT OF THE TREASURY DEPARTMENT OF THE TREASURY BILLING CODE 1505–01–D Financial Management Service 31 CFR Part 103 Privacy Act of 1974; System of DEPARTMENT OF AGRICULTURE Records RIN 1506–AA28 Forest Service Correction Financial Crimes Enforcement 36 CFR Part 219 In notice document 03–4457 Network; Anti-Money Laundering beginning on page 8964 in the issue of Programs for Dealers in Precious Wednesday, February 26, 2003, make Metals, Stones, or Jewels RIN 0596–AB86 the following correction: Correction National Forest System Land and On page 8965, in the second column, Resource Management Planning in the sixth line from the bottom, the In proposed rule document 03–4171 heading ‘‘TREASURY/FMS .015’’ beginning on page 8480 in the issue of Correction should read, ‘‘TREASURY/FMS .016’’. Friday, February 21, 2003 make the In proposed rule document 03–5116 [FR Doc. C3–4457 Filed 3–12–03; 8:45 am] following correction: appearing on page 10420 in the issue of BILLING CODE 1505–01–D

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Part II

Department of Health and Human Services Food and Drug Administration

21 CFR Parts 111 and 112 Current Good Manufacturing Practice in Manufacturing, Packing, or Holding Dietary Ingredients and Dietary Supplements; Proposed Rule

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DEPARTMENT OF HEALTH AND Table of Contents 6. What Requirements Apply to Laboratory HUMAN SERVICES I. Background Operations? (Proposed § 111.60) A. Dietary Supplement Health and 7. What Requirements Apply to Food and Drug Administration Education Act (DSHEA) Manufacturing Operations? (Proposed B. The Advance Notice of Proposed § 111.65) 8. What Requirements Apply to Packaging 21 CFR Parts 111 and 112 Rulemaking C. Industry and Consumer Outreach and Label Operations? (Proposed [Docket No. 96N–0417] 1. Dietary Supplement Strategic Plan § 111.70) Meetings 9. What Requirements Apply to Rejected RIN 0910–AB88 2. Small Business Outreach Meetings Components, Dietary Ingredients, Dietary 3. Site Visits to Dietary Supplement Supplements, Packaging, and Labels? Current Good Manufacturing Practice Manufacturing Firms (Proposed § 111.74) in Manufacturing, Packing, or Holding D. Food Advisory Committee Report F. Holding and Distributing (Proposed Dietary Ingredients and Dietary E. FDA’s Decision To Propose a Rule Subpart F) Supplements 1. Why Are CGMPs Needed? 1. What Requirements Apply to Holding a. CGMPs help protect the public health Components, Dietary Ingredients, Dietary AGENCY: Food and Drug Administration, b. CGMPs benefit consumers Supplements, Packaging, and Labels? HHS. 2. How Will CGMP Regulations Take Into (Proposed § 111.80). 2. What Requirements Apply to Holding ACTION: Proposed rule. Account Technical Feasibility? 3. How Can FDA Help Industry Achieve In-Process Material? (Proposed § 111.82) SUMMARY: The Food and Drug Compliance With CGMPs? 3. What Requirements Apply to Holding Administration (FDA) is proposing F. Proposal Highlights and Requests for Reserve Samples of Components, Dietary Comments Ingredients, and Dietary Supplements? current good manufacturing practice II. General Issues (Proposed § 111.83) (CGMP) regulations for dietary A. Legal Authority 4. What Requirements Apply to Returned ingredients and dietary supplements. B. Issues From the ANPRM Dietary Ingredients or Dietary The proposed rule would establish the III. Description of the Proposed Rule Supplements? (Proposed § 111.85) minimum CGMPs necessary to ensure A. General Provisions (Proposed Subpart 5. What Requirements Apply to that, if you engage in activities related A) Distributing Dietary Ingredients or to manufacturing, packaging, or holding 1. Who Is Subject to These Part III Dietary Supplements? (Proposed dietary ingredients or dietary Regulations? (Proposed § 111.1) § 111.90) 2. What Are These Regulations Intended to supplements, you do so in a manner G. Consumer Complaints—What Accomplish? (Proposed § 111.2) Requirements Apply to Consumer that will not adulterate and misbrand 3. What Definitions Apply to this Part? Complaints? (Proposed Subpart G, such dietary ingredients or dietary (Proposed § 111.3) § 111.95) supplements. The provisions would 4. Do Other Statutory Provisions and H. Records and Recordkeeping—What require manufacturers to evaluate the Regulations Apply? (Proposed § 111.5) Requirements Apply to Recordkeeping? identity, purity, quality, strength, and 5. Exclusions (Proposed § 111.6) (Proposed Subpart H, § 111.125) composition of their dietary ingredients B. Personnel (Proposed Subpart B) IV. Statement Concerning the Use of Plain 1. What Microbial Contamination and and dietary supplements. The proposed Language Hygiene Requirements Apply? (Proposed V. Paperwork Reduction Act of 1995 rule is one of many actions related to § 111.10) dietary supplements that we (FDA) are VI. Environmental Impact Considerations 2. What Personnel Qualification VII. Analysis of Impacts taking to promote and protect the public Requirements Apply? (Proposed A. Introduction health. § 111.12) B. Preliminary Regulatory Impact Analysis 3. What Supervisor Requirements Apply? DATES: Submit written or electronic 1. The Need for the Proposed CGMP (Proposed § 111.13) Regulations comments by June 11, 2003. Submit C. Physical Plant (Proposed Subpart C) 2. Regulatory Options written or electronic comments on the 1. What Sanitation Requirements Apply to a. No new regulatory action collection of information by April 14, Your Physical Plant? (Proposed § 111.15) b. Fewer requirements for vitamins and 2003. 2. What Design and Construction Requirements Apply to Your Physical minerals ADDRESSES: Submit written comments Plant? (Proposed § 111.20) c. More restrictive CGMP regulations than to the Dockets Management Branch D. Equipment and Utensils (Proposed the proposed regulations (HFA–305), Food and Drug Subpart D) d. HACCP without the other elements of Administration, 5630 Fishers Lane, rm. 1. What Requirements Apply to the CGMP regulations 1061, Rockville, MD 20852. Submit Equipment and Utensils You Use? e. Require final product testing only (Proposed § 111.25) f. Regulate only high-risk products electronic comments to http:// 3. Coverage of the Proposed Rule www.fda.gov/dockets/ecomments. 2. What Requirements Apply to Automatic, Mechanical, or Electronic Equipment? 4. Baseline Practices Fax written comments on the (Proposed § 111.30) 5. Baseline Risk information collection to the Office of E. Production and Process Controls 6. Benefits and Costs Information and Regulatory Affairs, (Proposed Subpart E) a. Reduced illnesses Office of Management and Budget 1. What Production and Process Controls b. Fewer products recalled (OMB), Attn: Stuart Shapiro, Desk Must You Use? (Proposed § 111.35) c. Reduced hypothetical search costs as a Officer for FDA, Fax (202) 395–6974, or 2. What Requirements Apply to Quality measure of the benefit from increased electronically mail comments to Control? (Proposed § 111.37) assurance of quality d. Other benefits [email protected]. 3. What Requirements Apply to Components, Dietary Ingredients, Dietary e. Total measured benefits FOR FURTHER INFORMATION CONTACT: Supplements, Packaging, and Labels You 7. Costs Karen Strauss, Center for Food Safety Receive? (Proposed § 111.40) a. Description of the costs and Applied Nutrition (HFS–821), Food 4. What Requirements Apply to b. Costs of general activity and Drug Administration, 5100 Paint Establishing a Master Manufacturing c. Major costs by type of activities Record? (Proposed § 111.45) d. Estimating costs Branch Pkwy., College Park, MD 20740, 5. What Requirements Apply to 8. Summary of Benefits and Costs 301–436–2375. Establishing a Batch Production Record? C. Initial Regulatory Flexibility Analysis SUPPLEMENTARY INFORMATION: (Proposed § 111.50) 1. Introduction

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2. Economic Effects on Small Entities DSHEA directed the President to notice of proposed rulemaking a. Number of small entities affected appoint a Commission on Dietary (ANPRM) asking for comments on b. Costs to small entities Supplement Labels (the Commission) to whether to institute rulemaking to 3. Regulatory Options consider several issues under DSHEA develop CGMP regulations for dietary a. Exemptions for small entities needing clarification. The Commission ingredients and dietary supplements b. Longer compliance periods 4. Description of Recordkeeping and was to conduct a study on, and provide and what would constitute CGMP Reporting recommendations for, the regulation of regulations for these products. 5. Summary label claims and statements for dietary The ANPRM contained the entire text VIII. Federalism supplements, including the use of of the industry outline. We also asked IX. Request for Comments literature in connection with the sale of nine questions (which we discuss later X. References dietary supplements and procedures for in section II.B of this document) in the ANPRM. The questions focused on I. Background the evaluation of such claims. In making its recommendations, the Commission issues that the industry outline did not A. Dietary Supplement Health and was to evaluate how best to provide address such as those issues noted Education Act (DSHEA) truthful, scientifically valid, and above. We received approximately 100 DSHEA (Pub. L. 103–417) was signed nonmisleading information to letters in response to the ANPRM. Each into law on October 25, 1994. DSHEA, consumers so that such consumers of those letters contained one or more among other things, amended the could make informed and appropriate comments. The comments came from consumers, consumer advocacy groups, Federal Food, Drug, and Cosmetic Act health care choices for themselves and health care professionals, health care (the act) by adding section 402(g) (21 their families. The Commission’s report professional organizations, industry, U.S.C. 342(g)). Section 402(g)(2) of the (Ref. 80) states that the Commission and industry trade associations. The act provides, in part, that the Secretary supports the efforts of industry and FDA majority of comments responded both to of Health and Human Services (the to develop appropriate CGMPs for the nine questions we asked in the Secretary) may by regulation prescribe dietary supplements. Guidance on the ANPRM and on certain provisions in good manufacturing practices for dietary type of information that a responsible manufacturer should have to the industry outline. We also address supplements. Such regulations shall be substantiate statements of nutritional the comments on the nine questions in modeled after CGMP regulations for support and safety is also included in section II.B of this document. We food and may not impose standards for the Commission’s report. The discuss significant comments about which there is no current and generally Commission’s report states that the certain provisions in the industry available analytical methodology. No substantiation files should include outline in our discussion of related standard of CGMP may be imposed assurance that CGMPs were followed in proposed requirements. unless such standard is included in a the manufacture of the product. Included with its comments to the regulation issued after notice and ANPRM, the United States opportunity for comment in accordance B. The Advance Notice of Proposed Pharmacopeia (USP) submitted a copy with 5 CFR chapter V. Rulemaking of its general chapter, ‘‘Manufacturing Congress enacted DSHEA to ensure On November 20, 1995, Practices for Nutritional Supplements,’’ consumers’ access to safe dietary representatives of the dietary (Ref. 2) and in March/April 2002, USP supplements. In the findings supplement industry submitted to FDA proposed revisions to this general accompanying DSHEA, Congress stated an outline for CGMP regulations for chapter to introduce provisions that improving the health status of U.S. dietary supplements and dietary pertaining to botanical preparations citizens is a national priority and that supplement ingredients. We evaluated (Ref. 82). In February 2000, we received the use of dietary supplements may help the outline and determined that it a copy of the National Nutritional Foods prevent chronic diseases and maintain provided a useful starting point for Association’s (NNFA) ‘‘NNFA Good good health (Ref. 1). If dietary developing CGMP regulations. Manufacturing Practice in supplements are adulterated because Nonetheless, we believed that the Manufacturing, Packing, or Holding they contain contaminants (such as industry outline did not address certain Dietary Supplements’’ (Ref. 3). We filth), because they do not contain the issues that should be considered when found that the industry outlines dietary ingredient they are represented developing a proposed rule on CGMPs published in the ANPRM, the USP to contain (for example, a product for dietary ingredients and dietary manufacturing practices, and the NNFA labeled as vitamin C that actually supplements. For example, the industry standards were useful in developing this contains niacin), or because the amount outline did not address the need for proposed rule. We included certain of the dietary ingredient thought to specific controls for automatic, provisions found in these outlines in provide a health benefit (for example, computer-controlled or assisted this CGMP proposed rule. These three folic acid to reduce the risk of neural systems. outlines indicate that dietary ingredient tube defects or calcium in an amount to In addition to identifying a number of and dietary supplement manufacturers reduce the risk of osteoporosis) is not issues that were not included in the already recognize that there are basic, actually present in the supplement, then industry outline but on which we common steps needed to manufacture a the consumer may suffer harm or may wanted public comment, we also dietary ingredient or dietary supplement not obtain the purported health benefit recognized that other interested parties, that is not adulterated although, as from their consumption. CGMP such as consumers, other industry established in the regulatory impact regulations for dietary ingredients and segments who had not participated in analysis, a large percentage of dietary supplements will help to ensure developing the outline, and the health manufacturers do not follow a good that the potential health benefits that care community should have an manufacturing model. For example, Congress identified as the basis for opportunity to provide comments on these practices include requirements DSHEA are obtained and that CGMPs for dietary supplements before for: consumers receive the dietary we developed a proposal. Therefore, in • Designing and constructing ingredients that are stated on the the Federal Register of February 6, 1997 physical plants that facilitate product label. (62 FR 5700), we issued an advance maintenance, cleaning, and proper

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manufacturing operations or to prevent the activities we should undertake as • CGMPs should require that mixup between different raw materials part of an overall strategy and the companies report adverse reactions; and and products; prioritization of those activities. In the • CGMPs should include guidance on • Establishing a quality control unit; notices for these meetings, we identified testing for ingredient identity and • Establishing and following written the development of CGMPs for dietary adulteration with toxic substances. procedures for: supplements as one activity that should 2. Small Business Outreach Meetings 1. Maintaining and cleaning be considered in an overall strategy. equipment and utensils; During and after the strategic We held public meetings on July 12, 2. Receiving, testing, or examining meetings, we received comments from September 28, and October 21, 1999, to materials received and testing of consumers, consumer advocacy groups, collect information from industry and finished product; health care professionals, health care others that would help us to understand 3. Using master and batch control professional organizations, industry, the economic impact on small records; and industry trade associations. The businesses of CGMP regulations for 4. Handling consumer complaints; comments addressed a wide range of dietary supplements. Transcripts of and activities related to regulating dietary these public meetings (docket number 5. Maintaining records for laboratory supplements. (These comments can be 96N–0417, ‘‘Development of Strategy for tests, production control, distribution, seen at our Dockets Management Branch Dietary Supplements’’) are available at and consumer complaints. (see ADDRESSES) in docket number 99N– our Dockets Management Branch or Based on the ANPRM, the comments 1174.) The comments generally electronically at http://www.fda.gov/ that we received in response to the identified the development of CGMP ohrms/dockets/dockets/96n0417/ ANPRM, our outreach activities (which regulations as a high priority activity tr00001.pdf. Public comments from we discuss below), and our own that should be included in any FDA small businesses included both support knowledge and expertise about CGMPs strategic plan for regulating dietary of and concern for CGMP regulations. for foods, drugs, cosmetics, devices, and supplements. Some comments that Small businesses expressed concerns biologics, we are proposing to establish addressed the development of CGMPs about the cost and the time involved in these CGMP regulations for dietary are summarized as follows: complying with any rule that contains ingredients and dietary supplements. • It would be useful to industry to the following requirements: The proposed regulations would impose have FDA establish CGMPs especially • Conducting tests to determine requirements for: (1) Personnel, (2) for small and intermediate-size firms identity, purity, quality, strength, and physical plants, (3) equipment and that are not clear on what they should composition of dietary ingredients and utensils, (4) production and process be doing; dietary supplements; controls, (5) holding and distributing, • CGMPs would establish a level • Maintaining written procedures and (6) consumer complaints related to good playing field for industry, which would records documenting that procedures manufacturing practices, and (7) records help prevent irresponsible firms from are followed; and • and recordkeeping. making and selling adulterated Providing data that support expiration dating. C. Industry and Consumer Outreach products; • CGMPs should be able to Public comments from small business During 1999, we conducted a number accommodate a wide variety of firms, expressed support for dietary of outreach activities related to dietary that is, small and large firms that supplement CGMP regulation. Some supplements. We held several public manufacture a wide array of different small businesses (1 with 15 employees) meetings to obtain input from the public types of products and ingredients; commented that they have CGMPs in on developing our overall strategy for • CGMPs should ensure that place with written procedures tailored achieving effective regulation of dietary consumers get dietary supplements with to the size of their operations. One small supplements, which could include the strength and the purity that business with sales under $1 million establishing CGMP regulations. We also consumers expect; commented that their plant materials held public meetings focused • CGMPs should ensure that every received in fresh form are identified specifically on CGMPs and the dietary supplement on the market has onsite by a botanist, and when the economic impact that any CGMP rule the safety, identity, purity, quality, and onsite botanist is not able to confirm for dietary ingredients and dietary strength it purports in the label to identity, the plant material is sent to an supplements may have on small possess; outside laboratory that conducts businesses. Additionally, FDA staff • CGMPs should include ingredient chemical analysis to confirm identity. toured several dietary supplement identity testing and other testing; 3. Site Visits to Dietary Supplement manufacturing firms to better • CGMPs should ensure that dietary Manufacturing Firms understand the manufacturing processes supplements are produced using a and practices that potentially would be master formula procedure and produced During the summer and fall of 1999, subject to a CGMP regulation for dietary in a sanitary facility; we visited eight dietary supplement ingredients and dietary supplements. • CGMPs should require that manufacturing firms. These visits Each of these activities contributed to manufacturers have documented included firms that: (1) Manufacture a our knowledge about the industry. evidence that their manufacturing vitamin using a fermentation process; process is under control on a consistent (2) grind, sift, blend, and otherwise treat 1. Dietary Supplement Strategic Plan basis; raw agricultural commodities (e.g., Meetings • CGMPs should require botanicals); (3) manufacture dietary We held public meetings on June 8 manufacturers to test dietary ingredients for use in manufacturing and July 20, 1999, to collect stakeholder ingredients, particularly imported dietary supplement tablets, capsules, comments on the development of our botanicals, for heavy metals, pesticides, softgels, and powders; (4) manufacture overall strategy for achieving effective and industrial contaminants; dietary supplements for packaging and regulation of dietary supplements. We • CGMPs should require expiration labeling by others; and (5) manufacture, designed the meetings to provide an dating and testing for dissolution and package, and label dietary supplements opportunity for public comment on both bioequivalence; under their own and others’ labels. The

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firms varied in size and were located in requirements in more detail later in this In deciding whether to propose CGMP several parts of the country. document. regulations for dietary supplements, we We found an array of manufacturing, asked ourselves: E. FDA’s Decision To Propose a Rule packaging, and holding practices in the • Why Are CGMP regulations firms. The practices included the needed? This proposed regulation, which sets • following: forth proposed CGMPs for dietary How will CGMP regulations take • Using CGMPs similar to those into account technical feasibility? and ingredients and dietary supplements, is • included in the ANPRM; part of our overall strategy for regulating How can FDA help industry • Using automatic systems to dietary supplements in a manner that achieve compliance with CGMPs? quarantine, segregate, approve, and promotes and protects the public health. 1. Why Are CGMPs Needed? release inventory; Before drafting the proposal, FDA CGMP regulations for dietary • Following written procedures; considered public comment in response ingredients and dietary supplements are • Having quality control units with to the ANPRM and to public meetings, necessary to promote and protect the the responsibility and authority observations at site visits to dietary public health. In addition, CGMP outlined in the ANPRM; supplement manufacturers, and • regulations would benefit consumers Performing one or more tests on advisory group reports. In drafting this economically and would benefit dietary ingredients and dietary proposal, FDA used, in part, the industry. supplements to determine the identity, industry coalition outline that was a. CGMPs help protect the public purity, quality, strength, and published as an ANPRM (62 FR 5700) health. The dietary supplement industry composition; in which the industry adopted broad • is one of the fastest growing product Verifying the reliability of provisions beyond those found in part areas that FDA regulates. In 1999, suppliers’ certifications; and 110 (21 CFR part 110). FDA’s purpose Prevention magazine conducted a • Documenting and maintaining at this proposed rule stage is to present survey entitled ‘‘Consumer Use of records for certain procedures, such as a broad enough scope so that it may Dietary Supplements’’ (Ref. 5). The master and batch production, quality receive comment on the depth and survey used data from telephone control and laboratory operations, breadth of what should be considered interviews with a nationally- distribution, and processing consumer by the agency in developing a final rule. representative sample of 2,000 adults complaints. Our intent is to provide the proper living in households with telephones in balance of regulation so that dietary D. Food Advisory Committee Report the continental United States. The ingredients and dietary supplements are telephone interviews were done in April In February 1998, the Food Advisory manufactured in a manner to prevent and May, 1999. Using population Committee (FAC) established a Dietary adulteration using recognized scientific estimates based on the Census Bureau’s Supplement Working Group to consider principles and both industry and March 1998 Current Population Survey what constitutes adequate testing for consumer expectations that are Estimates, the survey stated that identity of different dietary ingredients reasonable and appropriate. Therefore, approximately 186,014,712 adults live and what records are necessary to FDA seeks comment on whether each of in the households with telephones in demonstrate that CGMPs are maintained the proposed provisions are necessary to the United States and that an estimated throughout the manufacturing and ensure the safety and quality of dietary 158.1 million of these Americans in distribution process. The working group ingredients and dietary supplements households with telephones use dietary issued a report that discussed the and whether they are adequate to supplement products. These consumers selection of the most appropriate and protect the public health. In addition, spend approximately $8.5 billion a year reliable identity test and the general we seek comment on whether there are on dietary supplements. The survey also principles for consideration in setting certain provisions that are not proposed found that: performance standards for such tests but that may be necessary. Comments • Only 41 percent of the surveyed (Ref. 4). The report also identified the should include justification for why consumers who use vitamins and types of records that would be necessary provisions may or may not be necessary, minerals think they are very safe and to demonstrate that CGMPs are including supporting data where only 50 percent think they are maintained throughout the appropriate. If comments assert that somewhat safe; manufacturing and distribution process. certain provisions are not necessary, • Only 24 percent of the surveyed On June 25, 1999, the working group comments should include an consumers who use herbal products presented its report, in draft form, explanation on how, in the absence of think they are very safe; and only 53 during an FAC public meeting. We the requirement, one can ensure that percent think they are somewhat safe; received public comments during and there would be adequate protection of and after the June 25, 1999, public meeting. the public health when there is risk of • Twelve percent of the surveyed Although this proposal does not adulteration. Comments also should consumers who have used dietary address dietary ingredient identity address whether the gains to consumers supplements say they have experienced testing in the same detail as the working in product safety and quality are side effects or adverse reactions from group’s report, we considered the report warranted. Moreover, assuming that this their use of dietary supplements. in developing requirements for identity proposal does advance the public The survey also found strong public testing and CGMP records requirements health, comments should address support for increased Government in this proposal. The working group’s whether there is any reason to apply regulation of dietary supplements; 74 report may be useful in developing different requirements, including greater percent of the surveyed consumers industry guidance to supplement a or lesser requirements on small firms as reported that they think that the CGMP regulation for dietary ingredients compared to larger firms and the Government should be more involved in and dietary supplements. We discuss rationale for doing so. Finally, ensuring that these products are safe dietary ingredient and dietary comments should address the agency’s and do what they claim to do. supplement identity testing and legal authority to issue these However, unlike other major product recordkeeping for CGMP proposed regulations. areas, there are no FDA regulations that

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are specific to dietary ingredients and have to establish specifications for of these dietary supplements contained dietary supplements that establish a botanicals that may contain toxic dietary ingredient levels that could have minimum standard of practice for compounds and conduct testing to caused serious illness or injury. manufacturing, packaging, or holding. ensure that there are not toxic Illnesses or injuries such as nausea, The absence of minimum standards has compounds present that may adulterate vomiting, liver damage, and heart attack contributed to the adulteration and the dietary ingredient or dietary were reported from superpotent niacin misbranding of dietary ingredients and supplement. at an average level of 452 milligrams dietary supplements by contaminants or • We have found manufacturers using (mg) niacin, well above the upper limit because manufacturers do not set and nonfood-grade chemicals to for adults of 45 mg daily (Ref. 26). meet specifications for their products, manufacture dietary supplements (Ref. Recalls for subpotent dietary including specifications for identity, 15). The proposed rule would require supplements have included a recall of purity, quality, strength, and that manufacturers establish folic acid because the dietary composition. Thus, CGMP regulations specifications for components used in supplement contained 34 percent of the are necessary to protect the public manufacturing and also would require declared level (Ref. 27). Such a product health because a CGMP rule would manufacturers to establish and follow would be misbranded under section 403 establish a minimum standard of laboratory control procedures that of the act (21 U.S.C. 343). Folate plays practice for manufacturing, packaging, include criteria for establishing a well-documented and important role and holding dietary ingredients and appropriate specifications. The proposal in reducing the risk of neural tube dietary supplements. would further require manufacturers to defects. Neural tube birth defects, The following examples illustrate the conduct testing to confirm that their primarily spina bifida and anencephaly, wide range of dietary ingredient and specifications are met. These cause serious lifetime debilitating dietary supplement adulteration caused requirements, if finalized, would ensure injuries and disabilities, and even death. by manufacturing, packaging, or holding that manufacturers establish and use Thus, use of subpotent folic acid by practices. The examples, although not appropriate criteria, such as using food- women who are or may become exhaustive, demonstrate why CGMPs grade rather than industrial-grade pregnant may result in increased risk of are necessary to protect public health: chemicals, and would ensure that having a child with a neural tube defect. • In 1997, we received an adverse manufacturers conduct testing to The proposed rule would require event report (AER) regarding a young confirm that food-grade chemicals were manufacturers to establish woman who had taken a dietary received from the supplier. specifications for the dietary supplement and experienced a life- • Also during inspections, we have supplement the manufacturer makes threatening abnormal heart function found insanitary conditions in physical and then meet those specifications. (Ref. 6). We investigated the AER and plants where dietary ingredients or Therefore, if the proposed rule is determined that the dietary supplement dietary supplements were finalized, if the label for a folic acid the woman consumed contained manufactured, packaged, or held (Ref. supplement declares that the dietary Digitalis lanata, a plant that can cause 16). Pest infestation, building and supplement contains a certain level of life-threatening heart reactions (Refs. 6 equipment defects, and leaking pipes folic acid, the folic acid supplement through 10). We found D. lanata in that drip onto dietary supplements are must actually contain that level, or we samples of raw material labeled examples of insanitary conditions that would consider the folic acid ‘‘plantain’’ that was a dietary ingredient we have found that may lead to product supplement to be adulterated under in one of the dietary supplement adulteration and could cause consumer section 402(g) of the act. products used by this woman (Ref. 6). illnesses and injuries. The proposed • Other recalls have been necessary A nationwide listing of manufacturers rule would require a manufacturer, because of undeclared ingredients, indicated that 183 firms may have used packager, or holder to maintain its including color additives (Refs. 28 and the contaminated dietary ingredient in physical plant used for these activities 29), lactose (Ref. 30), and sulfites (Ref. dietary supplements. The proposed in a sanitary condition. 31). Undeclared ingredients, such as CGMP regulations, had they been in • In the past, we have been involved color additives, lactose, and sulfites, effect, would have required identity and in the recall of dietary supplements may cause potentially dangerous purity tests of dietary ingredients and contaminated with lead (Ref. 17), reactions in susceptible persons (Ref. dietary supplements and would likely salmonella (Ref. 18), Klebsiella 32). The proposed rule would require have prevented the use of the D. lanata pneumonia (Ref. 19), botulism (Ref. 20), manufacturers to verify that the correct in these dietary supplements. and glass (Ref. 21). These contaminants labels have been applied to dietary • In 1998, the American Herbal can cause serious illness or injury and, ingredients and dietary supplements Products Association (AHPA) surveyed in the case of lead, may result in chronic produced. The master manufacturing its members about commonly irreversible cognitive defects in children record would have to identify each adulterated botanicals and methods and progressive renal failure in adults. ingredient required to be declared on useful in detecting adulteration in The proposed rule would require the ingredient list under section 403 of botanicals (Ref. 11). AHPA members dietary ingredients and dietary the act. identified 43 botanicals, including D. supplements to be manufactured, • A study found that dietary lanata contaminated plantain, that are packaged, and held in a manner that ingredient content varied considerably commonly adulterated with prevents adulteration, including from the declared content (Ref. 33). The contaminants, the common adulterant adulteration by the contaminants such study examined ephedra alkaloids in 20 for each botanical, and a method for as those described. herbal dietary supplements containing identifying the adulterant. For example, • We also have been involved in ephedra (Ma Huang) to determine their aflatoxin and mycotoxin (toxic recalls for super- and subpotent dietary ephedra alkaloid content. This study compounds produced by certain molds) supplements. Recalls of superpotent found that norpseudoephedrine was are known to contaminate certain herbal dietary supplements have included the often present in the ephedra dietary and botanical dietary supplements following dietary ingredients: Vitamin A supplements. The study also observed (Refs. 11 through 14). Under this (Ref. 22), vitamin D (Ref. 23), vitamin B6 significant lot-to-lot variations in proposed rule, a manufacturer would (Ref. 24), and selenium (Ref. 25). Each alkaloid content for four products,

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including one product that had lot-to-lot Establishing CGMP regulations for the science, but would give you variations of ephedrine, dietary supplements is only part of our maximum flexibility in meeting the pseudoephedrine, and methylephedride broad science-based regulatory program requirement. For example, there are that exceeded 180 percent, 250 percent, for dietary supplements that is tests available for identity, purity, and 1,000 percent, respectively. Half of necessary to give consumers a high quality, strength, and composition of the products tested differed in their degree of confidence in the safety, certain dietary ingredients or dietary label claims for ephedra alkaloid composition, and labeling of dietary supplements. Because many tests for content and their actual alkaloid supplements. Aside from our CGMP identity, purity, quality, strength, and content. In some cases, the discrepancy efforts, we have taken other steps to composition of dietary ingredient or exceeded 20 percent. One product did protect the public health, such as: dietary supplements have not been not have any ephedra alkaloids. Lot-to- • Reviewing claim notifications officially validated, the proposal would lot variation in dietary ingredients is a under section 403(r)(6) of the act to permit tests using methods other than public health problem particularly identify unlawful claims; those that are officially validated. By because conditions of use recommended • Reviewing new dietary ingredient using the term ‘‘officially validated,’’ we or suggested in the labeling of dietary notifications to ensure that new dietary mean that the method is validated using supplements are presumably based on ingredients are reasonably expected to an interlaboratory collaborative study by the dietary supplement containing a be safe under section 413 of the act (21 which a proposed method is validated certain amount of the dietary ingredient. U.S.C. 350b); by independent testing in separate • If the dietary supplement contains more Evaluating the nutrition labeling of laboratories under identical conditions or less than the amount that the dietary supplements; • (Ref. 35). An AOAC International manufacturer represents, then the Monitoring, through AERs (formerly the Association of Official consumer does not receive the potential voluntarily submitted to FDA, the Analytical Chemists) Official Method is health benefit from the dietary occurrence of adverse events to identify an example of an officially validated supplement or is exposed to an amount potentially unsafe products; and • method. We discuss test methods that could present risk of injury or Taking compliance actions against validation in more detail later in this illness. The proposed rule would products that are adulterated or document. misbranded. require manufacturers to establish In areas where scientific study is still controls, including master The CGMP regulation, if finalized, would, along with our other dietary evolving, we did not propose specific manufacturing and batch production requirements. For example, we did not records to ensure that they use the ingredient and dietary supplement initiatives, contribute further to the propose requirements for dissolution, correct amount of the dietary ingredient disintegration, bioavailability, or to produce the dietary supplement, and protection of public health. expiration dating. In those areas, it may that they apply the correct label to the b. CGMPs benefit consumers. In be premature to propose a requirement dietary supplement. addition to the public health benefits for • A private company analyzed a consumers, CGMP regulations for at this time. In the preamble to this rule, sample of dietary supplements and dietary ingredients and dietary we identify those areas where additional found that some dietary supplements supplements will benefit consumers in scientific study is necessary before we did not contain the dietary ingredients other ways. Consumers should not have can propose a dietary supplement claimed on the label (Ref. 34). The study to wonder whether the dietary CGMP requirement. For example, we found that 25 percent of gingko biloba supplements they buy are adulterated or did not identify defect action levels products, 20 percent of saw palmetto, 33 whether they contain the correct dietary (DALs) for dietary ingredients because percent of glucosamine, chrondroitin ingredients or contain the dietary there are not enough data available to and combined glucosamine/ ingredients in the amount stated on the identify an appropriate DAL for most chondroitin, and 50 percent of SAMe product’s label. Consumers who dietary ingredients. Likewise, further did not contain the dietary ingredients purchase a product that does not study is needed for some dietary claimed in their product labels. The contain the amount or strength listed on ingredients before dissolution, proposed rule would require the label experience an economic loss disintegration, bioavailability, manufacturers to establish and meet because they are paying for something expiration dating, or other quality specifications for the identity, purity, that they did not receive. CGMPs would standard requirements can be proposed. quality, strength, and composition of require manufacturers to establish and 3. How Can FDA Help Industry Achieve dietary supplements. meet specifications for identity, purity, Compliance With CGMPs? Given the wide range of public health quality, strength and composition of concerns presented by the dietary supplements to help ensure that During small business outreach public manufacturing, packaging, and holding consumers buy dietary supplements that meetings and in comments to the practices for dietary ingredients and are not adulterated, contain the dietary ANPRM, members of the dietary dietary supplements, a comprehensive ingredients declared on the product’s supplement industry told us that they system of controls is necessary to label, and contain the amount or would like our help in determining how prevent adulteration and misbranding. strength listed on the label. Therefore, to implement CGMP regulations for CGMPs are intended to establish such a CGMPs would benefit consumers. dietary ingredients and supplements. comprehensive system. Manufacturers We have heard that issuing guidance who operate in accordance with CGMPs 2. How Will CGMP Regulations Take documents and education and training would be less likely to distribute Into Account Technical Feasibility? would be helpful. We invite comment adulterated and misbranded dietary In developing this proposed rule, we on the use of guidance documents, ingredients or dietary supplements than were careful not to propose education, training, or other approaches those who do not meet the requirements that are not technically and potential sources of education and requirements. Quality assurance will feasible to meet. In some areas where training that you believe would assist maximize the probability that there has been scientific study but industry efforts to implement the unadulterated dietary supplements will where the science is still evolving, the proposed CGMP regulations, if finalized reach the marketplace. proposal recognizes the evolving state of as proposed.

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F. Proposal Highlights and Requests for products are truthful and not the manufacturing process where Comments misleading. The agency would review control is necessary to ensure that the This proposed rule is intended to the lawfulness of such statements under dietary supplement contains the ensure that manufacturing practices will sections 403(a)(1) and 201(n) of the act. identity, purity, quality, strength, and not result in an adulterated dietary We propose requirements for: (1) composition claimed on the label. We supplement and that supplements are Personnel, (2) the physical plant propose flexible testing requirements: properly labeled. This proposed rule, if environment, (3) equipment and You would be required to test final finalized as proposed, will give utensils, (4) production and process products for adherence to specifications, consumers greater confidence that the controls, (5) holding and distributing, unless a scientifically valid analytical dietary supplements they choose to use (6) consumer complaints related to method does not exist; in the latter case, will have the identity, strength, purity, CGMPs, and (7) records and you would be required to test incoming quality, or composition claimed on the recordkeeping. Key provisions of the shipment lots of components, dietary label. A manufacturer of a dietary proposed rule are highlighted below. ingredients, or dietary supplements for ingredient or a dietary supplement We also seek comment on whether any such specification, and to test in- cannot make claims that state or imply certain additional provisions should be process for any such specification in that the dietary ingredient or dietary included as requirements in a final rule. accordance with the master Proposed ‘‘personnel’’ requirements supplement is safe and/or effective manufacturing record where you would require that you have qualified simply because it has been determine control is necessary to ensure employees and supervisors, to take manufactured in compliance with the identity, purity, quality, strength, measures to exclude any person from current good manufacturing practice and composition of the product. your operations who might be a source Proposed ‘‘holding and distributing’’ (CGMP) requirements. However, we of microbial contamination, and to use requirements would protect believe that a voluntary labeling hygienic practices to the extent components, dietary ingredients, dietary statement about the fact that a dietary necessary to protect against supplements, packaging, and labels ingredient or dietary supplement has contamination. against contamination and deterioration. been made in compliance with CGMP Proposed ‘‘physical plant’’ You would be required to hold requirements might be made lawfully requirements are intended to help components, dietary ingredients, dietary under the act, provided that such a prevent contamination from your supplements, packaging, and labels statement is made in an appropriate physical plant environment. You would under appropriate conditions of context and with adequate disclaimers be required to design and construct your temperature, humidity, and light so that so that consumers fully understand it physical plant in a manner to protect their quality is not affected; and under and are not misled by it. The proposed dietary ingredients and dietary conditions that do not lead to the rule governing CGMP requirements for supplements from becoming adulterated mixup, contamination, or deterioration. dietary supplements address during manufacturing, packaging, and Proposed ‘‘consumer complaints’’ manufacturing controls to ensure that holding. You would be required to keep requirements would require that you dietary ingredients and dietary your physical plant in a clean and keep a written record of each consumer supplements are produced in a manner sanitary condition and in sufficient complaint related to good that will not adulterate or misbrand repair to prevent contamination of manufacturing practices; review such such products. Compliance with any components, dietary ingredients, dietary complaints to determine whether the final rule, based on the proposal, will supplements, or contact surfaces. consumer complaint involves a possible not ensure that the dietary ingredient or Proposed ‘‘equipment and utensils’’ failure of a dietary ingredient or dietary dietary supplement itself is safe or provisions would require that you use supplement to meet any of its effective. Thus, the agency believes that equipment and utensils that are of specifications, or any other an unqualified statement saying simply appropriate design, construction, and requirements of this part, including ‘‘produced in compliance with dietary workmanship for their intended use and those that may result in a possible risk supplement current good manufacturing that you provide for adequate cleaning of illness or injury (i.e., an adverse practice requirements,’’ without more, and maintenance. You would be event); and investigate a consumer could well suggest that a product may required to maintain and calibrate your complaint when there is a reasonable be safe and effective or somehow instruments and controls for accuracy possibility of a relationship between the superior to other dietary ingredient and and precision and to ensure that consumption of a dietary supplement dietary supplement products that are automatic, mechanical, and electronic and an adverse event. For the purposes subject to the same CGMP requirements. equipment works as intended. You of this regulation, a consumer complaint Such a statement would likely be would also be required to maintain, about product quality may or may not considered misleading by FDA under clean, and sanitize, as necessary, all include concerns about a possible sections 403(a)(1) and 201(n) of the act. equipment utensils and contact surfaces hazard to health. However, a consumer We believe however, that it might be that are used to manufacture, package, complaint does not include an adverse possible to cure an unqualified or hold dietary ingredients or dietary event, illness, or injury related to the statement by including language supplements. safety of a particular dietary ingredient clarifying to consumers that all dietary Under the proposed ‘‘production and independent of whether the product is ingredients and dietary supplements process controls’’ requirements, you produced under good manufacturing must be manufactured in compliance would be required to establish and use practices. with CGMP requirements and that such a quality control unit in your Proposed ‘‘records and compliance does not mean that the manufacturing, packaging, and label recordkeeping’’ requirements would tell dietary ingredient or dietary supplement operations. We propose requirements you how long you must keep certain is safe or effective. As usual, the for establishing and using master records to show how you complied with manufacturer would be responsible for manufacturing records and batch the CGMP requirements. We would ensuring that any such voluntary control records to ensure batch-to-batch require that you keep written records for labeling statements on its dietary consistency. Specifications would be 3 years beyond the date of manufacture ingredient and dietary supplement required for any point, step, or stage in of the last batch of dietary ingredients

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or dietary supplements associated with bottling of bottled drinking water; 21 903, 348, 371(a), 374, and 381) and those records and have all required Part CFR 120, Hazard Analysis and sections 402 and 403 of the act and records, or copies of such records, Critical Control Point (HAACP) section 361 of the Public Health Service readily available during the retention Procedures for the Safe and Sanitary Act (the PHS Act) (42 U.S.C. 264). period for authorized inspection and Processing and Importing of Juice; 21 Section 402(g) of the act gives us copying by FDA when requested. CFR Part 123, Fish and fishery products; explicit authority to issue a rule CGMP records document the 21 CFR Part 106 Infant formula quality regulating conditions for manufacturing, manufacturer’s operation throughout control procedures; and 21 CFR Part packaging, and holding dietary time and are essential to an enforceable 113, Thermally processed low-acid supplements. Section 402(g)(1) of the regulation. Because FDA does not foods packaged in hermetically sealed act states that a dietary supplement is observe the manufacturer’s operation containers). Further, records are adulterated if ‘‘it has been prepared, fulltime, records can ensure that the included in the CGMPs submitted to packed, or held under conditions that FDA has the information needed to FDA by industry, the National do not meet current good manufacturing identify noncompliance and to bring a Nutritional Foods Association practice regulations.’’ Section 402(g)(2) non-compliant manufacturer into Standards, the NSF International draft of the act authorizes us to, by regulation, compliance. Records can show that standards (Ref. 83), and the USP draft ‘‘prescribe good manufacturing practices appropriate monitoring is performed, Manufacturing Practices for Dietary for dietary supplements.’’ In addition, pinpoint with confidence when a Supplements. section 402(g)(2) of the act states that deviation began and ended, and prove We seek comment on whether certain any such regulations ‘‘shall be modeled that required quality control measures additional provisions should be after current good manufacturing and practices were performed as often included as requirements in a final rule. practice regulations for food and may as necessary to ensure control. Review For example, we invite comment on not impose standards for which there is of manufacturing records with sufficient whether a final rule should include a no current and generally available frequency can ensure that any problems requirement for certain personnel analytical methodology.’’ are uncovered promptly and can records; for written procedures in a In section 402(g)(2) of the act, which facilitate prompt modification, have an number of areas; for equipment describes the general parameters of impact on the production of subsequent verification; and for expiration dating CGMPs for dietary supplements, batches of the product, and prevent and related testing. Written procedures Congress stated that the regulations introduction of potentially hazardous are included in the dietary supplement were to be ‘‘modeled after current good dietary supplements into the market CGMP outline submitted to FDA by manufacturing practice regulations for place. Review of consumer complaint industry, National Nutritional Foods food.’’ To determine what Congress records can facilitate the identification Association standards, the NSF meant, we look to the plain meaning of of trends in reports of illness or injury, International draft standards, and the the phrase. Webster’s II New Riverside identify related batch records to identify USP draft Manufacturing Practices. In University Dictionary defines ‘‘model’’ previously undetected manufacturing order to limit the burden to as ‘‘[a] preliminary pattern serving as deviation, and have an impact on the manufacturers, FDA is not proposing to the plan from which an item not yet prompt recall of any potentially require written procedures. However, constructed will be produced’’ (Ref. 81). hazardous dietary supplement. FDA is proposing that manufacturers Thus, when Congress used the term ‘‘modeled after’’ Congress intended that We seek comment on whether the maintain appropriate records to ensure proposed recordkeeping requirements we use the food CGMPs as a the identity, purity, quality, strength, are not necessary to prevent ‘‘preliminary pattern’’ for the dietary and composition of a given product and adulteration; to ensure the identity, supplement CGMPs. If Congress had records that are necessary for efficient purity, quality, strength, and intended for the agency to adopt food enforcement and to permit trace back. composition of the dietary ingredient or CGMPs as the CGMPs for dietary Although we have not proposed dietary supplement; to an enforceable supplements, Congress could have requirements for written procedures as regulation; and for the other reasons explicitly stated that dietary did these other groups, we seek cited. If comments assert that supplements were subject to food comment on whether such practices recordkeeping provisions are not CGMPs. should be included in a final rule. Later necessary, comments should include an The provisions in the dietary explanation of why recordkeeping in this document, we request comments supplement CGMP proposal are requirements are not necessary on specific written procedures and modeled after food CGMPs. The general including how, in the absence of the describe FDA’s current thinking CGMP provisions for food in part 110 requirements, one can prevent concerning what could be included in relate not only to insanitary production adulteration, ensure the identity, purity, such a written procedure. practices, but other practices, such as We also seek comment on whether quality, strength, and composition of the having appropriate quality control this rule should include specific dietary ingredient or dietary operations, to ensure that a food is supplement, ensure an enforceable requirements for the use of animal- manufactured in a manner that will not regulation, and the other reasons cited. derived dietary ingredients, and adulterate the food. Further, the CGMPs If comments agree that the requirements for persons who handle in part 110 describe the minimally recordkeeping requirements are raw agricultural commodities. Specific acceptable practices for all food necessary for reasons other than those requests for comment of this type are handling operations. They are not we have provided, the comments should contained below in relevant sections of intended to cover specific issues that so state and provide an explanation. this preamble. may relate to a particular product type, Although records are not required in II. General Issues rather, are general provisions concerned 21 CFR Part 110, CGMPs in with practices relating to the receiving, manufacturing, packing, or holding A. Legal Authority inspecting, quality control operations, human food, records are required in the We are proposing these regulations packaging, segregating, processing, other commodity-driven food CGMPs under sections 201, 393, 409, 701(a), storing, and transporting of food. The (i.e., 21 CFR Part 129, Processing and 704, and 801 of the act (21 U.S.C. 321, specific provisions of the food CGMPs

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are linked to hazards that are inherent manufacturer must test or examine the a food additive under section 409 of the to foods (e.g., microbial contamination ingredient using appropriate methods. act, unless they are subject to an and contamination with macroscopic The ‘‘modeled after’’ language in section exception to the definition of ‘‘food filth). 402(g) of the act provides the agency additive’’ under section 201(s) of the The proposed dietary supplement with the flexibility to devise CGMPs act. CGMPs are modeled after the food that make sense for dietary Moreover, dietary ingredients and CGMPs in part 110 in that they cover supplements, and that are based on the dietary supplements may contain the scope of practices related to the same principles as food CGMPs in part pathogenic bacteria or viruses that pose receiving, inspecting, quality control 110, i.e., to prevent adulteration related serious public health and safety operations, packaging, segregating, to insanitary conditions or other concerns (Ref. 36). Botanical dietary processing, storing, and distribution of conditions that may be necessary to ingredients are living plants that may dietary ingredients and dietary prevent adulteration, given the nature of contain different microorganisms. These supplements. Dietary supplements the specific food product and the include Lactobacillus, Leuconostoc, require many of the same types of characteristics of, and hazards inherent Pseudomonas, and Xanthomonas sanitary practices and other practices as in, that food. species and molds. Potential pathogens conventional food production in order The scope of the legal authority for such as Listeria monocytogens, to produce a product that is not the proposed dietary supplement Pseudomonas aeruginosa and adulterated; dietary supplements are CGMPs includes the legal authorities Enterobacteriacae may also be present. Secondary microbial contamination subject to many of the same hazards as upon which the food CGMPs are based. are conventional foods. However, from soil (Bacillus cereus, Clostridium For example, section 402(a)(3) of the act dietary supplements have their own set perfringens and mycotoxin-producing states that a food is deemed adulterated of unique requirements as a result of the molds, etc.), animal feces (Salmonella if ‘‘it consists in whole or in part of any characteristics and hazards due to their and Shigella spp., Escherichia coli) and filthy, putrid, or decomposed substance, ‘‘hybrid’’ nature, e.g., dietary handling (Staphylococcus aureus) can or if it is otherwise unfit for food.’’ supplements can be considered as also occur during harvesting, Section 402(a)(4) of the act states that a falling somewhere along the continuum processing, and transportation (Ref. 36). food is deemed adulterated if ‘‘it has between conventional foods on the one Animal-derived dietary ingredients or been prepared, packed, or held under hand and drugs on the other. Thus, the dietary supplements may also pose a insanitary conditions whereby it may CGMPs for dietary supplements need to risk. For example, bovine colostrum, the address the characteristics and hazards have become contaminated with filth, or lacteal secretion which precedes milk of dietary supplements, the operations whereby it may have been rendered after a cow gives birth, is a substance and processes used to manufacture injurious to health.’’ While section that is used in dietary supplements and dietary supplements, particularly those 402(a)(3) of the act focuses on the food likely presents the same potential health necessary to ensure the identity, purity, itself, section 402(a)(4) of the act focuses risks as does milk. Bovine milk may quality, strength, and composition on the conditions under which the food contain pathogenic organisms capable of claimed on the label. is prepared, packed, or held. Courts causing diseases in man such as Dietary supplements, unlike have adopted a broad reading of section tuberculosis or undulant fever. Glands conventional foods, contain ingredients 402(a)(4) of the act when we have taken and other animal tissues may contain that are consumed in very small actions to advance the public health (see the infective agent that causes quantities, for example, in a tablet or U.S. v. Nova Scotia Food Products transmissible spongiform capsule. Such ingredients may be Corp., 568 F. 2d 240, 248 (2d Cir. 1977)). encephalopathy (TSE) if they originate intended to have an anticipated, specific The agency tentatively concludes that from an animal infected with the physiological response. Such the authorities that it relied on for its disease (Ref. 37). ingredients are more ‘‘drug-like’’ than umbrella CGMPs in part 110 for food are We have authority to issue regulations ‘‘food-like,’’ in part, because very small relevant to the authorities that it needs under section 361 of the PHS Act. The changes in the strength, purity, or for this proposed rule for dietary Secretary delegated authority to the quality of the ingredient can have supplement CGMPs. In addition, section Commissioner of FDA (the significant, and possibly adverse, health 409 of the act is another provision that Commissioner) to exercise the functions consequences to those who ingest it. is relevant to dietary supplement vested in the Secretary under section Thus, the dietary supplement CGMPs, CGMPs. Section 409 of the act addresses 361 of the PHS Act (see 21 CFR by necessity, need to include provisions circumstances under which a food may 5.10(a)(3)). This authority authorizes the related to identity, purity, strength, be deemed adulterated based on the use Commissioner to issue and enforce quality, and composition of the product of a food additive. Section 409 of the act regulations that, in the Commissioner’s so that the dietary supplement ‘‘food’’ is relevant to good manufacturing judgment, are necessary to prevent the product will be manufactured in a practices for foods, including dietary introduction, transmission, or spread of manner that will not result in supplements, because a food would be communicable diseases from one State adulteration. deemed adulterated if it contained a to another. Because this authority is Further, plant products that are used food additive that was not used in a designed to eliminate the introduction to produce dietary supplements may be manner consistent with the statutory of diseases from one State to another, ground or in a powder and not easily and regulatory requirements under the Commissioner may exercise the recognized compared to conventional section 409 of the act (see sections authority over the disease-causing food that is readily identifiable (e.g., one 402(a)(2)(C) and 409 of the act). substance within the State where the can readily distinguish between white Although Congress explicitly excluded food is manufactured, packaged, or flour and white sugar, but not between ‘‘dietary ingredients,’’ as defined in held. The Commissioner, therefore, ground plaintain and ground D. lanata). section 201(ff) of the act, from the assumes the authority to issue Thus, for the manufacturer to be sure definition of food additive, (see section regulations under the PHS Act to assure that the dietary supplement contains the 201(s)(6) of the act), ingredients other that foods are manufactured, packaged, correct ingredient and the amount of the than dietary ingredients in a dietary and held under conditions that will ingredient that is intended, the supplement are subject to regulation as prevent the introduction, transmission,

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or spread of communicable diseases In addition to the broad authority in aware of any potential problems relating between States. Thus, the agency is section 402(g) of the act, we look to the to a particular dietary ingredient and invoking its authority under the PHS statutory scheme of DSHEA as a whole these CGMPs, and so that a Act in this proposed rule to prevent the in proposing regulations related to the manufacturer can take appropriate spread of communicable disease from manufacture, packaging and holding of action when necessary. The proposed dietary ingredients or dietary dietary ingredients and dietary CGMPs would reflect the act’s supplements in intrastate and interstate supplements. Section 403(q)(5)(F) of the regulatory scheme generally and, more commerce. act (section 7(b) of DSHEA) requires that specifically, DSHEA’s provisions that In developing proposed CGMPs for a dietary supplement product provide contemplate consistent, controlled dietary supplements, we relied on the nutrition information. To comply with manufacture of dietary supplements (see basic concept underlying the food section 403(q)(5)(F) of the act, you must sections 402(f) and 403(q)(5)(F) and (s) CGMPs and upheld by the courts. As a be able to identify the dietary ingredient of the act). We tentatively conclude that, result, the basic concept for the food or ingredients in a dietary supplement therefore, section 402(g)(2) of the act CGMPs and the proposed dietary and the quantity of each. Moreover, the gives us the authority to develop dietary supplement CGMPs is the same: To provisions in section 403(s) of the act supplement CGMPs that are not establish regulations that will help relate to identity, purity, quality, identical to our food CGMPs and that ensure that your practices for preparing, strength, and compositional are appropriately tailored to the packaging, and holding dietary specifications of a dietary supplement. manufacturing, packaging, and holding ingredients and dietary supplements do Thus, Congress sought to ensure in of dietary ingredients and dietary not result in an adulterated food DSHEA that dietary supplements would supplements. entering interstate commerce. Sections 701(a) and 704 of the act also provide accurate information to the In addition to relying on the broad give us authority to establish regulations consumer on the identity of the dietary authority in relevant sections of the act related to CGMPs for dietary ingredients ingredient and, if an herb or botanical, that we used to issue the food CGMP and dietary supplements. Under section the source from which it is derived. regulations, we look to the other 701(a) of the act, we have the authority Moreover, Congress sought to ensure relevant statutory language in section to issue regulations for the efficient that the dietary supplement would have 402(g) of the act and the act as a whole enforcement of the act, and such the strength or meet the quality, purity, in deciding the basis for our legal regulations have been held to have the authority in proposing regulations and compositional specifications that force and effect of law (see National related to the manufacture, packaging, the dietary supplement is represented to Nutritional Foods Ass’n v. Weinberger, and holding of dietary ingredients and meet. Because Congress established 512 F.2d 688, 697–98 (2d Cir. 1975)). dietary supplements. We note that section 403(s) of the act—a provision Section 704 of the act gives us the certain terms Congress used in section that requires that a dietary supplement authority to inspect factories, 402(g)(2) of the act, i.e., ‘‘standards’’ and that bears representations about warehouses, and other establishments in ‘‘current and generally available identity, purity, quality, strength, and which foods, including dietary analytical methodology,’’ show that compositional specifications meet those ingredients and dietary supplements, Congress intended to give us the representations—it is reasonable for us are manufactured, processed, packed, or authority to establish regulations in this to establish regulations for held and to inspect their facilities, rule that do not have parallel provisions manufacturing, packaging, and holding equipment, finished and unfinished in other food CGMPs. Specifically, the addressing those same features. These materials, containers, and labeling. second phrase of the second sentence in representations relate to characteristics In addition to having the authority to section 402(g)(2) of the act states that we and hazards to which dietary establish broad regulations for ‘‘may not impose standards for which supplements are subject. Further, in manufacturing, packaging, and holding there is no current and generally section 402(f) of the act, Congress dietary ingredients and dietary available analytical methodology.’’ identified circumstances under which a supplements, we also have the authority ‘‘Standards’’ and ‘‘current and generally dietary supplement or a dietary to require recordkeeping as part of these available analytical methodology’’ are ingredient would be deemed adulterated regulations. Two questions that we terms of art in the scientific field, and because it may present a significant or considered in deciding whether to we are relying on the meaning of these unreasonable risk of illness or injury. propose requirements for recordkeeping terms in the field of science in these Congress expected that a dietary included whether the statutory scheme proposed CGMPs regulations, which supplement would be manufactured in as a whole justified the proposed implement that provision. This statutory a way that ensures that the dietary regulation and whether the proposed language does not limit CGMPs for supplement contains dietary ingredients recordkeeping requirements would be dietary supplements solely to the food that do not present an unreasonable risk limited, would clearly assist in the CGMP regulations at the time DSHEA of illness or injury and for which the efficient enforcement of the act, and was enacted. If Congress had intended conditions of use are based. Because one would not create an unreasonable for the CGMPs for dietary supplements must be able to measure or analyze a recordkeeping burden. In the other to be identical to the CGMPs for food, dietary ingredient in order to determine relevant sections of this document, we the language in section 402(g)(2) of the whether a supplement in fact contains explain in more detail the act relating to ‘‘standards’’ and ‘‘current that dietary ingredient, it is reasonable recordkeeping provisions that we and generally available analytical for a proposed rule on CGMPs to believe are limited to what are necessary methodolog[ies]’’ would be include provisions related to identity, for the efficient enforcement of the act, meaningless. Thus, CGMP regulations purity, quality, strength, and and because the requests are limited, for dietary ingredients and dietary composition of a dietary ingredient or a would therefore not create an supplements may include provisions dietary supplement. Moreover, it is unreasonable recordkeeping burden. relevant to dietary ingredients and reasonable to propose a requirement For this proposed CGMP rule for dietary supplements that were not in that records of complaints be kept and dietary ingredients and dietary current food regulations at the time investigations be done, as necessary, so supplements, recordkeeping is DSHEA was enacted. that the manufacturer and FDA can be necessary to provide the type of

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documentation that would demonstrate The nine questions in the ANPRM, whether a DAL for a dietary ingredient that dietary ingredients and dietary comments, and our responses are as should be established at a different level supplements are manufactured, follows: than what has been established for the packaged, and held under the Question 1. Is there a need to develop same ingredient used in conventional conditions that would be required under specific defect action levels (DALs) for food. the proposed CGMP regulations. dietary ingredients? DALs are established for a food Further, FDA is using its authority The ANPRM stated that the use of a ingredient on a per weight basis. The under sections 801 and 701(a) of the act botanical in a dietary supplement may DALs for whole ginger for ‘‘insect filth in proposing recordkeeping result in a much greater exposure to the and/or mold’’ is an ‘‘average of 3 requirements for dietary ingredients and botanical ingredient for consumers percent or more pieces by weight are dietary supplements that may not be because the dietary supplement will be insect-infected and/or moldy’’ and for marketed or sold in the United States consumed in greater amounts than if the ‘‘mammalian excreta’’ is an ‘‘average of and that are exported under section ingredient was in a food as a spice or 3 mg or more of mammalian excreta per 801(e) of the act. flavoring agent. pound’’ (Ref. 41). Because the DAL is Several comments stated that In addition to having the authority established by weight of the whole establishing DALs for dietary under the act to require recordkeeping, ginger, the DAL for ginger would apply ingredients that are different than DALs we also have authority to require access whether it is used as an ingredient in a for food is not necessary. The comments to the records. Because the practices set conventional food or a dietary disagreed with our statement that forth in the proposed CGMP rule are ingredient in a dietary supplement. dietary ingredients in dietary necessary to providing consumers with Therefore, if we have established a DAL supplements and conventional foods are dietary supplements that are not in the industry compliance document consumed in different quantities. For adulterated, access to records that for a conventional food ingredient, that example, the comments stated that demonstrate that firms follow CGMPs is DAL also would apply to that ingredient generally botanical ingredients are when used as a dietary ingredient in a essential to confirming systematic present in dietary supplements in dietary supplement until such time that compliance with CGMPs. We also have approximately the same amounts we would establish a different DAL for the authority to copy the records when normally consumed in conventional its use as a dietary ingredient (Ref. 41). necessary. We may consider it necessary foods. to copy records when, for example, our Other comments generally opposed However, we do not have many dietary investigator may need assistance in applying the current DALs for foods to ingredients that are included in the DAL reviewing a certain record from relevant dietary ingredients and instead compliance guide. We agree that DALs experts in headquarters. If we were supported the development of DALs for may be needed for some dietary unable to copy the records, we would dietary ingredients, especially for ingredients, especially ingredients like have to rely solely on our inspector’s botanicals and herbals. Many comments botanicals that are subject to the same notes and reports when drawing recommended that we cooperate with type of defects (such as mold and insect conclusions. A failure to have a required industry, outside the rulemaking parts) as other food for which DALs record would mean that a food is process, to develop DALs for dietary have been established. We base DALs on adulterated under section 402(g) of the ingredients. scientific information such as literature act. We disagree with the comments that surveys, scientific market surveys, and Recordkeeping will not only help the state that establishing DALs for dietary laboratory analyses and also on agency to determine whether dietary ingredients that are different than DALs information gained through physical ingredients or dietary supplements were for food is not necessary because an plant inspections. If and when we manufactured, packaged, and held ingredient in food and in a dietary determine that we have sufficient consistent with CGMP regulations, but supplement would be consumed in the information to develop DALs for dietary also will provide a public health benefit same amounts. The comment did not ingredients, we will consider whether to to consumers. When manufacturers provide evidence or examples to do so. keep records, for example, of lot or support the comment. Some food Question 2. We requested comments batch numbers, the records facilitate a ingredients for which DALs have been on appropriate testing requirements to manufacturer’s recall of suspect established also are dietary ingredients provide positive identification of dietary products in case a recall becomes used in dietary supplements. For ingredients, particularly plant materials, necessary. This benefits consumers example, a DAL has been established for used in dietary supplements. because the manufacturer can recall its whole ginger used in a conventional The ANPRM explained that the products that may be adulterated or food. Ginger is also a dietary ingredient misidentification of dietary ingredients, misbranded more quickly. used in dietary supplements. We have particularly plant materials, used in found dietary supplements that dietary supplements may present a B. Issues From the ANPRM recommend a daily intake of ginger of significant public health and economic As stated previously, in addition to 4,815 mg, 1,260 mg, and 2,200 mg (Ref. concern. The ANPRM also noted that inviting comment on the industry- 38). One teaspoon of raw ginger root is the analytical methodology available for drafted CGMP outline, we asked nine equal to 2,000 mg (2 grams (g)) and one identifying many dietary ingredients is questions in the ANPRM on CGMP teaspoon of ground ginger is equal to limited. We invited comments on the issues for dietary supplements that the 1,800 mg of ginger (1.8 g) (Ref. 39). A technical and scientific feasibility of industry outline did not address. In this recipe for gingersnaps yielding 18 identifying different types of dietary section, we summarize each question cookies specifies 1 teaspoon ginger (Ref. ingredients. We also solicited and the principal comments we 40). Thus, ginger would be consumed in information on what constitutes received, and we respond to the greater amounts as a dietary supplement ‘‘adequate testing’’ for identity of comments. We address other significant than as an ingredient in a conventional different types of dietary ingredients, comments about the ANPRM, other than food. However, we have tentatively and, in the absence of testing, what the nine questions we asked, elsewhere concluded that we do not have types of practices would be effective in this document. sufficient information to determine alternatives to testing to ensure the

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identity of different types of dietary comments noted that test methods that identity testing may be useful, and we ingredients. are presently available and used for will consider future development of Comments generally supported identifying botanicals are not officially ingredient identity testing guidance requiring tests of some kind to validated. If an officially validated documents. positively identify dietary ingredients method is not available for a dietary Manufacturers should be responsible and to verify dietary ingredient identity. ingredient, several comments suggested for identifying the ingredients that they The comments put forth different working towards AOAC International use in their products and, in addition, reasons, which ranged from ensuring validation and, in the interim, for verifying that the dietary ingredients public safety to preventing economic instituting peer review of less formal or dietary supplements they make adulteration. Some comments suggested test methods. Other comments noted contain the identity, purity, quality, that suppliers should be responsible for that the dietary supplement industry strength, and composition that the identifying the dietary ingredients they has begun an effort to develop validated manufacturer intends the product to supply to manufacturers and that test methods for several botanical have. As discussed previously in this manufacturers should be responsible for ingredients. One comment suggested document, we have found serious only verifying the identity of the that it is important to develop methods adverse events to be related to dietary finished product. Other comments that are subject to peer review and to ingredient misidentification. The stated that the manufacturer should be institute a certification program for manufacturer must conduct identity responsible for identification and testing facilities because the analysis of tests to ensure that they used the correct should not rely on a supplier’s natural products requires specialized ingredient to prevent potential serious certification. training in natural product chemistry. adverse events. We discuss identity Some comments raised issues relating The comment did not indicate who (e.g., testing for dietary ingredients and to the actual identity tests that should FDA or another organization) should dietary supplements later in this be recommended or required and develop a certification program. document. discussed analytical method selection Some comments only addressed We agree with the comments that and method options, use of and identity testing of unprocessed certification of testing facilities could be availability of official validated botanicals. These comments said that an important step in ensuring analytical analytical methods, and certification of for unprocessed botanicals in whole or quality. However, certification of testing testing facilities that conduct identity in part (e.g., flowers, roots, leaves, etc.), facilities is outside the scope of this tests on natural products. Some organoleptic techniques are sufficient rule. comments suggested that identity test provided that accurate records are Question 3. FDA requested comments method options should include maintained and that the manufacturing on standards that should be met in organoleptic and microscopic methods process provides a paper trail of positive certifying that a dietary ingredient or and chemical analytical methods. The identification. One comment suggested dietary supplement is not contaminated comments noted that selecting the that a ‘‘voucher specimen’’ (a sample of with filth; that it is free of harmful appropriate method is dependent on the the plant material) from the supplier contaminants, pesticide residues, or type and form of the ingredient. Other along with a certificate of botanical other impurities; that it is comments said that manufacturers identity would be an adequate record. microbiologically safe; and that it meets should be responsible for selecting the The certificate of botanical identity specified quality and identity standards. appropriate method to confirm would follow the material through the The ANPRM noted that, under ingredient identity. Most comments manufacturing process, thus creating a § 110.80, a food manufacturer may recommended that we provide guidance paper trail. The voucher specimen accept a supplier’s certification that its to industry in defining what comprises would be held for a specific period of products do not contain adequate testing for different types of time or, if necessary, serve as a microorganisms, filth, or other foreign ingredients, but did not support permanent record. material that would adulterate the regulations prescribing the test method Dietary ingredient identification is an product instead of testing or evaluating or methods for specific ingredients. important part of CGMPs. We agree with the supplier’s products itself. As a Comments generally supported the the comments that identity testing result, we asked for comments on use of a standard compendial method, requirements are needed but that no whether a certification will provide such as those published by the USP or single approach or test method may be assurance that dietary ingredients are AOAC International. Where no appropriate for every dietary ingredient. not contaminated or whether specific published method exists, the comments For example, microscopic or testing requirements are necessary. suggested that manufacturers should be organoleptic tests might be appropriate Comments generally supported responsible for developing adequate and for herbs or plant parts (because you can relying on a supplier’s certification that effective identification testing see, taste, or smell them), but not a dietary ingredient is what it purports procedures, requirements, or practices appropriate for amino acids (which to be and is not contaminated. The to ensure the identity of the dietary cannot be identified by the naked eye or comments stated that reliance on the ingredients they use. One comment identified by using your senses). A supplier’s certification should be an from a vitamin manufacturer noted that microscopic test might be appropriate alternative to testing raw materials to most of its products have recognized for herbs that still have their leaves or detect microorganisms, filth, or foreign and established identity tests as part of other distinguishing marks or material so long as the reliability of the their compendial status. Other characteristics, but not for ground-up supplier’s certification is confirmed. comments from botanical dietary herbs. Thus, we agree with the Most comments stated that supplement manufacturers noted that comments stating that the key principle manufacturers are responsible for their current methods for identifying in dietary ingredient identification determining, on a case-by-case basis, plant material are adequate, but that testing is to establish an appropriate whether a supplier’s certification they will, over time, be enhanced by the procedure that will identify, with provides adequate assurance that a availability of more widely recognized certainty, the dietary ingredients used in dietary ingredient is what it purports to methods and techniques as a result of making a dietary supplement. We agree be and is not adulterated. Some current work in this field. The that a guidance document on ingredient comments based their support for

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relying on a supplier’s certification on follow written procedures and noted final rule. We discuss written § 110.80(a)(2) through (a)(4); these that the industry outline in the ANPRM procedures for various stages of provisions allow food manufacturers to would require written procedures for manufacturing, packaging, labeling, rely on a supplier’s guarantee or many processes and functions. Some holding, and for handling consumer certification that raw materials or other comments noted that written procedures complaints later in this document. ingredients do not contain levels of and day-to-day records documenting We disagree, however, that records microorganisms or toxins that may that the procedures were followed will are not necessary to show that certain produce illness or are otherwise ensure that products are safely and operations and processes are being contaminated. The comments suggested properly manufactured on a day-to-day performed. Records document that various means for determining the basis and that this can be confirmed by quality control operations and processes reliability of a supplier’s certification, periodic independent internal audits. such as calibrating instruments and including independent analysis, in- One comment stated that the controls; manufacturing a dietary house testing, and review of protocols. manufacturer should be responsible for ingredient or dietary supplement batch; Other comments stated that, because ensuring, through employee training, and handling consumer complaints the CGMP regulations in part 110 permit self-audit programs, and batch records, were performed. We further discuss the reliance on a supplier’s certification and that quality control and other basis for the proposed recordkeeping because section 402(g)(2) of the act procedures prescribed for the requirement for certain operations and specifies that the CGMP regulations for manufacture of a dietary supplement are processes later in this document. We dietary supplements should be modeled properly and diligently executed. Other believe that section 402(g) of the act after the CGMP regulations for food, a comments stated that it is good business allows us to require written procedures supplier’s certification for dietary practice to ensure product quality and documentation that the procedures supplements must be acceptable. through periodic review of records and were followed. As explained previously, We have considered the comments on quality control audits and that failure to such records may be necessary for whether a supplier’s certification could establish procedures will result in ensuring that dietary ingredients and provide adequate assurance that a product recalls, potential injury, and dietary supplements are manufactured, dietary ingredient is what it purports to litigation for damages for defective packaged, and held consistent with be and is not adulterated. We disagree goods. these regulations. Moreover, we believe that manufacturers may rely on such Some comments objected to any that the fact that the food CGMPs in part certifications to determine that an requirement for written procedures or 110 do not have recordkeeping ingredient is not contaminated, for documentation that the procedures were requirements does not preclude us from example, with filth or microorganisms. followed. The comments stated that proposing recordkeeping requirements Using a supplier certification, guarantee, section 402(g)(2) of the act states that in this proposed rule, although we seek or certification in lieu of performing dietary supplement CGMPs must be further comment on the issue. testing on each shipment lot of modeled after the food CGMP Question 5. We invited comment on components, dietary ingredients, or regulations and the food CGMP whether dietary supplement CGMP dietary supplements is not appropriate regulations do not require written regulations should require that firms because a supplier’s certification or procedures or documentation that have competent medical authorities guarantee would not necessarily ensure procedures were followed. evaluate reports of injuries or illnesses that the identity, purity, quality, We agree with those comments that and to determine if followup action is strength, or composition of a support the development and use of necessary to protect the public health. component, dietary ingredient or dietary written procedures by manufacturers The ANPRM explained that many supplement is met. We discuss testing and are considering whether we should dietary supplements contain requirements and why we believe that require written procedures in a final pharmacologically active substances, the use of supplier’s guarantee or rule. We are proposing requirements for which distinguish dietary supplements certification is not sufficient in lieu of documenting certain operations and from many foods, and some dietary a manufacturer’s own testing in more processes while not requiring written supplements may contain potential detail later in this document. procedures to remove underlying costs allergens. Because the characteristics Question 4. We asked for comments for establishing and updating such may result in adverse events in certain on whether a CGMP rule should require written procedures while preserving the consumers, we asked whether we manufacturers to establish procedures to records necessary to permit trace back. should consider requiring firms to take document, on a continuing or daily When manufacturers develop and certain actions with respect to reviewing basis, that they followed preestablished follow written procedures such AERs. We also sought comments on procedures for making dietary procedures help to ensure that whether a CGMP rule should require supplements. manufacturers produce a consistent firms to establish procedures for The ANPRM noted that the food dietary ingredient or dietary supplement determining whether a reported injury CGMP regulations under part 110 do not that is of a predictable quality and that constitutes a serious problem, and what require manufacturers to document that is not adulterated. Following written actions are to be taken when serious they are following established procedures and documenting problems are identified. procedures prescribed for compliance with those procedures will Comments generally opposed manufacturing a food. However, the ensure regular performance of a firm’s requiring manufacturers to establish a ANPRM also noted that section 402(g) of established programs and procedures procedure for evaluation and followup the act does not preclude us from and will provide additional assurance of of reports of illness and injuries. adopting CGMP requirements for dietary effective communication of appropriate Comments also opposed requiring that a ingredients and dietary supplements information from the firm management competent medical authority evaluate that have no counterpart in part 110 if to the line personnel. We invite all reports of illness or injuries to we have an appropriate basis for doing comment on whether written determine if followup action is so. procedures should be required in a final necessary to protect the public health. Most comments generally supported rule, and whether there are other Some comments, opposing requiring requiring manufacturers to develop and procedures, that we should include in a written procedures and evaluation,

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suggested alternatives to requirements, problems are rare. These comments also ingredient caused the adverse event. such as using the Centers for Disease stated that a costly and burdensome The fact that the wrong ingredient Control and Prevention, poison control safety surveillance system is not appeared in your product would centers, FDA’s MedWatch program, and warranted for these products, that the indicate that some type of problem consumer complaint files to monitor term ‘‘serious adverse event’’ is occurred in your manufacturing process and record injuries and illnesses ambiguous, and that most of that product. Once you identify the attributed to marketed products. manufacturers lack trained medical ingredient as the cause of the problem, In contrast, several comments personnel to serve this function. you would be able to take steps to supported a requirement for written Because we have found dietary remove any such product from the procedures or medical evaluation of supplement problems that could have market and prevent the problem from serious adverse events. Some comments been prevented by CGMPs and that recurring, helping to ensure product stated that an evaluation procedure is resulted in product recalls, we find that quality and purity, and restore necessary and that manufacturers are manufacturers must be able to identify consumer confidence that your products and should be responsible for these types of problems with their contain the correct ingredients. In short, establishing procedures to respond products. It is a manufacturer’s investigations of consumer complaints appropriately to reports of serious responsibility to do so. We disagree benefit both manufacturers and illness and injury that may have with those comments stating that we do consumers and these benefits will exist resulted from using a dietary not have legal authority to require a regardless of whether there are many or supplement. Other comments stated that manufacturer to evaluate consumer few injuries or illnesses believed to be medical evaluations are not necessary complaints as we propose to define that associated with your product. because manufacturers should be using term in this proposed rule. Question 6. We invited comment on appropriate internal quality control We also disagree that written whether a CGMP regulation for dietary procedures within their quality control procedures would present unwarranted supplements should require units or elsewhere to identify the cause potential criminal liability. Persons manufacturers to establish procedures to of adverse events and respond subject to regulation under the act and identify, evaluate, and respond to appropriately. its implementing regulations may face potential safety concerns with dietary We agree with those comments stating civil or criminal action if they fail to ingredients. We asked whether such an that manufacturers are and should be comply with the act or our regulations evaluation is necessary, and, if so, what responsible for evaluating consumer (see, e.g., sections 301, 302, and 303 (21 elements need to be included in such an complaints. Manufacturers have an U.S.C. 331, 332, and 333) of the act). evaluation and their relative importance obligation to ensure that the dietary The fact that such an outcome is (e.g., the presence and potency of supplements that they put on the market possible under the statutory scheme pharmacologically active substances, are not adulterated or misbranded. does not mean that a provision that the presence of different Consumer complaints about a dietary would require written procedures and microorganisms, the presence of supplement might indicate a CGMP- evaluation of consumer complaints is different contaminants and impurities). related problem associated with a ‘‘unwarranted.’’ If we were to accept We also asked whether we should dietary supplement. For example, a such a claim, then we would find it require that these evaluations be consumer complaint might identify a difficult to issue any regulation to documented in a firm’s records, and, if previously unknown manufacturing implement the act, and that result so, what type of records would be deviation that caused a batch of dietary would conflict with our obligation to adequate to document that such an supplements to be adulterated. Thus, a protect the public health. Therefore, we evaluation had occurred. procedure for reviewing and reject the comments’ argument In general, the comments opposed investigating consumer complaints is regarding potential criminal liability requiring manufacturers to establish recommended. Records of consumer and its effect on rulemaking. procedures to identify, evaluate, and complaints related to CGMPs, and the We also disagree with the claim that respond to potential safety concerns review and investigation of such there is no basis for requiring an with dietary ingredients. Most records, are necessary and we discuss evaluation of adverse events because comments claimed that such procedures such a record requirement later in this there are many unsubstantiated reports are unnecessary because dietary document. In that discussion, we of injuries or illness and because dietary ingredients have a history of safe use in address what we mean by a consumer supplement safety problems are rare. In food and that DSHEA is based on this complaint and we address the the past, voluntary reports of injury or history of prior use in food. Other comments on the type of evaluation that illness have identified adulterated comments argued that, because DSHEA would be necessary for consumer dietary supplements. Consumer is based on a history of prior use of complaints and whether the comments’ complaint reports associated with the existing dietary supplements and suggested alternatives to written use of marketed dietary supplements, established a notification procedure for procedures and medical evaluations are such as D. lanata contaminated new dietary ingredients, a requirement sufficient to identify potential concerns. plantain, identified the need for further concerning potential safety concerns for Some comments objected to written investigation and led to recalls or dietary ingredients would be beyond the procedures and medical evaluation warnings to protect the public health scope of this rulemaking. arguing that such requirements go (Ref. 6). Evaluation of consumer Several comments noted that for those beyond the CGMP regulations for food complaint reports can reveal patterns of dietary ingredients that do not have a and, therefore, would be contrary to adverse events that assist us and history of safe use in food and are section 402(g)(2) of the act. Other manufacturers in identifying the need considered ‘‘new dietary ingredients,’’ comments claimed that written for further investigation to determine as defined in section 413(c) of the act, procedures would present unwarranted what public health actions are needed. DSHEA established procedures for potential criminal liability, that there For example, assume that, after you evaluating safety concerns. Section are many unsubstantiated injuries and investigate an AER, you find that the 413(a)(2) of the act requires a illness inherent in the food industry, product contained an ingredient that manufacturer to submit a ‘‘new dietary and that dietary supplement safety should not have been used and that the ingredient’’ notification to FDA 75 days

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before introducing or delivering a CGMPs. As the comments recognize, ingredients it uses before it markets the dietary supplement containing a new manufacturers have an essential and product. dietary ingredient into interstate critical responsibility to substantiate the The proposed CGMP rule focuses on commerce. The notification must safety of the dietary ingredients they use ensuring that the manufacturer knows provide the basis upon which the in manufacturing a product. what it is putting in its product and is petitioner has concluded that the Section 402(g) of the act is not the manufacturing, packaging, and holding dietary supplement containing the new only provision relevant to whether a the product in a manner that will not dietary ingredient is reasonably dietary ingredient or dietary supplement adulterate or misbrand the product. For expected to be safe. Therefore, the may be deemed to be adulterated. example, assume that you use a comments argued that procedures to Section 402(f)(1) of the act, in part, particular herb as your dietary identify, evaluate, and respond to declares a dietary supplement to be ingredient. However, there are different potential safety concerns are not adulterated if it: species of that herb. Some species are necessary in a CGMP rule. • Presents a significant or poisonous; others are not. Additionally, Other comments stated that FDA unreasonable risk of illness or injury there are variations within the same should not require procedures to under conditions of use described in the species of herb depending on where the identify, evaluate, and consider labeling or, if no conditions of use are herbs were grown. Some variants may potential safety concerns with dietary suggested or recommended in the contain higher levels of a particular ingredients because manufacturers labeling, under ordinary conditions of dietary ingredient or marker compound already have an essential and critical use; than other variants. So, how do you responsibility to substantiate the safety • Is a new dietary ingredient for know whether you have the right herb of the dietary ingredients they use in which there is inadequate information (nonpoisonous species of herb intended manufacturing a product. The to provide reasonable assurance that the for use) and whether it meets your comments suggested that FDA does not dietary ingredient does not present a specifications? CGMPs would require need to require written procedures significant or unreasonable risk of that you check the identity of the herbs because manufacturers must consult the illness or injury; or you receive; by doing so, you would be generally known and generally available able to tell whether you have the correct • Is or contains a dietary ingredient scientific literature to determine that a herbs, whether your herbs are that renders it adulterated under section dietary ingredient is safe. Some poisonous, or whether they meet your 402(a)(1) of the act under the conditions comments suggested that, instead of specifications. In this example, the of use recommended or suggested in the FDA requiring safety evaluations, a potential safety concerns involve the labeling. (Section 402(a)(1) of the act third-party could evaluate safety dietary ingredient itself rather than any declares a food to be adulterated if it concerns. Several comments suggested issue concerning contamination which contains substances that are poisonous that manufacturers who use dietary would adulterate or may lead to or deleterious substance that may render ingredients that have little history of use adulteration of the dietary ingredient, it injurious to health.) in food in the United States should and thus, the dietary supplement which retain documentation concerning the Additionally, section 301(a) of the act contains the dietary ingredient. dietary ingredient’s safety. One prohibits the introduction of adulterated As for the comments’ arguments comment suggested that we issue a food into interstate commerce. concerning a dietary ingredient’s history guidance document to identify the types So, for a dietary ingredient or dietary of use, we do not need to address of acceptable ‘‘history of use’’ standards supplement manufacturer to comply history of use as part of this CGMP for dietary ingredients having little with sections 301(a) and 402(f)(1) of the proposal. CGMPs focus on how a history of use in food in the United act, it must take steps regarding product is made under current States and to describe the potential safety concerns before it manufacturing processes. A dietary documentation that would be needed markets the product. Otherwise, if the ingredient’s history of use does not regarding a dietary ingredient’s safety. manufacturer had no obligation to provide any assurance that a particular Although the comments focused on evaluate possible safety concerns before product has the identity, purity, quality, the safety of using particular dietary marketing a product, sections 301(a) and strength, and composition that it ingredients, the safety concerns 402(f)(1) of the act would not make purports to have. Further, history of use described in question 6 actually consist sense and the manufacturer would be does not necessarily provide any of two concepts: (1) Is the product acting contrary to the basic assurance that a particular product formulated using safe dietary congressional intent behind DSHEA, would not pose a significant or ingredients; and (2) is the product which was to ensure that safe dietary unreasonable risk of illness or injury manufactured, packaged, and held in a supplements are available to consumers. under conditions of use recommended manner that would not adulterate or For example, assume that a or suggested in the labeling or under misbrand the product? The proposed manufacturer wanted to market a new ordinary conditions of use. rule focuses on safety concerns related dietary ingredient but lacked evidence As for those comments discussing to the latter concept. Specifically, the to show that it is safe. Under section whether manufacturers or other parties proposed rule focuses on the steps and 402(f)(1)(B) of the act, the manufacturer should evaluate potential safety processes used in the manufacturing, must have adequate information to concerns, the proposed rule would packaging, and holding of the product to provide reasonable assurance of the require a manufacturer to evaluate a ensure, for example, that the product dietary ingredient’s safety before it consumer complaint to determine has the identity, purity, quality, markets the dietary ingredient; whether the complaint relates to good strength, and composition claimed and otherwise, the dietary ingredient is manufacturing practices. Such an does not become adulterated or adulterated under section 402(f)(1)(B) of evaluation would include possible misbranded. The agency notes that no the act, and section 301(a) of the act hazards to health resulting from the comments appeared to argue that safety would prohibit its sale in interstate manufacturing, packaging, or holding of issues relating to potential commerce. Thus, the manufacturer has a product. Nevertheless, you should contamination or adulteration related to a statutory obligation to examine safety note that, insofar as compliance with manufacturing processes are outside concerns relating to the dietary the act and any CGMP regulations are

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concerned, persons who market dietary Several comments supported dietary supplement that is adulterated. ingredients and dietary supplements requirements for specific controls, but Computer-controlled or computer- always remain responsible for their opposed using validation-of-operation assisted operations are not perfect; products. If the manufacturer markets mandates like those in the CGMP computers are subject to malfunctions the product, it would have to meet all regulations for drugs. One comment and ‘‘bugs’’ (errors) in the software they proposed CGMP requirements, if the suggested that we regulate computer- use. Problems with data entered into the agency finalizes the rule as proposed. If controlled and computer-assisted computer may produce unreliable another person buys a product (such as operations for dietary supplements in results. For these reasons, specific bulk dietary ingredients) from a the same way that we regulate such controls for computer-controlled or manufacturer and distributes the operations in the pharmaceutical computer-assisted operations are product under its own name, that industry, but only where an operation is necessary to prevent the manufacture of person must meet all applicable CGMP directly related to the product’s an adulterated dietary ingredient or requirements. concentration or purity. One comment dietary supplement. Question 7. We invited comment on suggested that we consider adopting the A few comments stated that no whether specific controls are necessary computer-controlled and computer- specific requirements for computer- for computer-controlled or assisted assisted procedures specified in the controlled or computer-assisted operations and how best to ensure that proposed infant formula CGMP. operations are needed because computer the software programs and equipment We propose general requirements to hardware and software are simply used to direct and monitor the ensure that equipment is suitable for its specialized plant equipment so that no manufacturing process are properly intended use. However, we seek special regulations are needed. designed, tested, validated, and comment, in the proposed rule, about We agree that computers are monitored. whether we should include specialized pieces of plant equipment and, therefore, should be subject to Comments generally supported requirements, written procedures, and additional requirements beyond those specific controls for computer- records for equipment verification and re-verification. We request comment on which would apply to plant equipment. controlled or computer-assisted what verification manufacturers should Computers are specialized pieces of operations. One comment suggested be using in their computer-controlled or equipment because they are subject to requiring manufacturers to confirm, by computer-assisted operations to ensure malfunctions and ‘‘bugs’’ (errors) in the adequate and documented testing, that that a dietary ingredient or a dietary software, they are reliant upon data their computer software programs supplement that is produced is not entered into a computer, and they may perform their intended functions when adulterated during manufacturing. In be used to perform important roles such computers are used as part of an addition, we request comment on as component or dietary ingredient automated production system having a whether we should issue guidance identification, measuring components significant and direct impact on product documents on verification procedures and dietary ingredients, and safety. Another comment suggested for use with computer-controlled or quarantining materials. Consequently, requiring that software programs and computer-assisted operations. Guidance proposed § 111.30 would establish equipment used to direct and monitor documents generally represent FDA’s requirements for automatic, mechanical, manufacturing processes are properly advice or current thinking on a or electronic equipment. The proposed designed, tested, evaluated, and particular matter and are not binding on requirements would cover, among other monitored. The comment added that, if any person. In contrast, regulations things, automatic equipment design, we consider imposing specific create enforceable requirements that and routine calibration, inspection, and requirements on how firms document apply to all persons engaged in the same checks to ensure proper performance. the adequacy of their computer- action or who make the same product. As stated previously, we are seeking controlled or assisted operations, we As discussed in greater detail later in comment on whether we should include should address those recommendations this document, certain processes are requirements for verification and re- through a guidance document instead of necessary to ensure that computer- verification of automatic, mechanical, or issuing regulations. controlled or computer-assisted electronic equipment and processes and We agree that computer-controlled or equipment functions properly. This is whether we should include computer-assisted operations need to be because of the important role of such requirements for computerized systems properly designed, tested, evaluated, equipment in manufacturing. For that are separate from requirements for and monitored to ensure that the example, if computer-controlled or other mechanical or automatic computers do what they are supposed to computer-assisted equipment is used to equipment. We discuss proposed do. Manufacturers should confirm, by control components, inprocess § 111.30 in greater detail later in this adequate and documented testing, that materials, and rejected materials document. their computer software programs unsuitable for use, the operation must Question 8. We asked for comments perform their intended functions function as expected to ensure that on whether certain, or all, of the because computer use as part of an components suitable for use in requirements for manufacturing and automated production system has a manufacturing dietary ingredients and handling dietary ingredients and dietary significant and direct impact on product dietary supplements are not mixed up supplements may be more effectively safety. Computers are an important with components held under quarantine addressed by a regulation based on the controlling piece of equipment in the such as those components that have principles of Hazard Analysis and manufacture of dietary supplements been rejected as unsuitable for use. If Critical Control Point (HACCP), rather because they often direct and control computer-controlled or computer- than the system outlined in the industry key steps or processes in the assisted operations are used for the submission. manufacture of dietary supplements. If addition and mixing of components, In the ANPRM, we noted that, computers do not operate correctly, the they must function properly to ensure because of the wide variety of dietary dietary supplements manufactured that the correct components are added ingredients and dietary supplements using those computers may be and appropriately mixed to avoid and because of the heterogenous adulterated. producing a dietary ingredient or composition of the dietary supplement

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industry, CGMPs based on HACCP proposed part 111 would be treated as We agree that some manufacturing principles may provide a more flexible records under this proposal. operations are subject to greater hazards and less burdensome regulatory Question 9. We invited comment on than others, and have drafted the framework for manufacturers and whether broad CGMP regulations will proposed rule accordingly. For example, distributors than the approach set out in be adequate, or whether it will be there are microbial hazards associated the industry submission. necessary to address the operations of with raw botanicals. To address these Most comments opposed basing a particular segments of the dietary hazards, the proposal would require that CGMP regulation for dietary ingredients supplement industry. you perform tests on the botanicals. On and dietary supplements on HACCP Most comments supported broad the other hand, there are fewer hazards principles. Most comments supported CGMP regulations covering all segments associated with holding and distributing applying traditional CGMP of the dietary supplement industry finished dietary supplements, so the requirements on manufacturing, instead of specific regulations tailored proposal would impose less packaging, and holding to dietary to distinct segments of the industry. One comprehensive requirements for ingredients and dietary supplements. In comment stated that the differences holding and distributing operations. general, the comments that opposed between distinct segments of the dietary We are persuaded by the comments requiring HACCP for dietary ingredients supplement industry, such as that support a broad CGMP regulation as and dietary supplements asserted that: manufacturers of raw materials or preferable to multiple regulations (1) A HACCP program would not be distributors of finished products, are no focused on particular segments of the appropriate because HACCP focuses on more pronounced than similar segments industry. We agree with the comments microbial contamination of products in the food industry. Another comment that multiple regulations might be that provide a favorable environment for stated that having numerous CGMPs confusing and burdensome, especially growth of microbes that may be present, could subject raw materials and dietary to firms that manufacture products that and these hazards are not a major ingredients to multiple CGMPs, thus fall into multiple categories. For concern for dietary supplements; (2) making manufacturing operations more instance, it would be easier for regulated firms and for us if firms were required CGMPs are the best means of assuring complex. This comment also questioned the safety, quality, and composition of to adhere to one set of CGMP whether issuing multiple regulations is dietary ingredients and dietary requirements rather than follow, for necessary or economically justified in supplements; (3) HACCP is not required example, one set of CGMP requirements an era of limited corporate and for the food industry as a whole; and (4) for vitamins and a different set of CGMP government regulatory resources. Other HACCP would provide minimal requirements for minerals. comments emphasized the importance incremental value at significant We also recognize, though, that there of ensuring that all dietary supplement additional costs. may be some reasons to treat different Other comments opposed mandatory manufacturers (i.e., both small and large types of dietary ingredients or dietary HACCP regulations for dietary manufacturers, and foreign supplements differently in specific ingredients and dietary supplements, manufacturers planning to import instances. For example, it may be but said manufacturers could dietary supplements into the United appropriate to require one type of test implement voluntarily HACCP instead. States) follow the same CGMP for confirming the identity of amino One comment, which supported requirements. acids and another type of test for voluntary implementation of HACCP, In contrast, some comments confirming the identity of herbals. wanted manufacturers to be exempt supported drafting regulations for However, for the reasons discussed from having to disclose HACCP records particular segments of the dietary previously, we are proposing to to any Federal agency. supplement industry. One comment establish one set of broad CGMP HACCP principles can be applied to stated that certain stages of the regulations for all types of products. a broad range of manufacturing manufacturing process, such as the Because we recognize that one set of practices and HACCP principles are not distribution of raw dietary ingredients, specific requirements may not be solely focused on microbial should be more strictly and appropriate for all types of dietary contamination, but instead, are intended comprehensively regulated than other ingredients and dietary supplements, to identify and appropriately control stages because potential hazards are we have proposed regulations that allow steps in manufacturing where any type more prevalent during these manufacturers to develop practices to of adulteration can occur. Nevertheless, manufacturing stages. The comment meet CGMP requirements. Depending after considering the comments, we stated that conversely, the holding, on our experience with this proposed have decided to propose a CGMP distribution, and sale of a finished rule, we will consider whether we need approach for dietary ingredients and dietary supplement may require less to reevaluate our decision to establish dietary supplements. We believe that comprehensive regulations because they one set of requirements for all dietary CGMPs would establish a system of are subject to fewer potential hazards. ingredients and dietary supplements. controls that, given the variations in Other comments supported different We agree with the comments that the size, technological sophistication, and levels of safety testing for different types proposed rule should not make any regulatory experience among dietary of dietary supplement products. For distinction between dietary ingredients ingredient and dietary supplement example, some comments said that or dietary supplements made in the firms, would create a strong regulatory products such as melatonin and United States and those made in a foundation throughout the industry. dehydroepiandrosterone resemble foreign country. The proposed rule You may voluntarily choose to drugs, so we should require safety would require that foreign firms that implement a HACCP plan that meets the testing in animals and humans and want to export dietary ingredients and requirements of the National Advisory impose druglike CGMP requirements for dietary supplements to the United Committee on Microbiological Criteria manufacturing. Another comment stated States manufacture, package, and hold for Foods, however, proposed part 111 that less stringent CGMPs would be dietary ingredients and dietary would still apply to you (Ref. 42). Any appropriate for herbal dietary supplements consistent with proposed HACCP plans that also are intended to supplements because they have long part 111. Moreover, under this proposed meet the records requirements under histories of food use and safety. rule, if a U.S. firm contracts with a

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foreign firm to package dietary ‘‘General Provisions’’ [Reserved]; 1. Who Is Subject to These Part III supplements for sale in the United Subpart B ‘‘New Dietary Ingredients’’ Regulations? (Proposed § 111.1) States, the imported product would [Reserved]; and Subpart C ‘‘Restricted Proposed § 111.1 entitled ‘‘Who is have to comply with the requirements Dietary Ingredients’’ [Reserved]. subject to these regulations?’’ describes in proposed part 111. In addition, the Proposed subpart C would include the scope of the rule. Proposed § 111.1 U.S. firm would be required to meet all restrictions for substances used in states that you are subject to the applicable CGMP regulations under this dietary supplements, such as the requirements in part 111 if you proposed CGMP rule related to those proposed rule for dietary supplements manufacture, package, or hold a dietary activities in which it engages under the containing ephedrine alkaloids, if ingredient or dietary supplement. As proposed rule. We invite comment on finalized. stated previously in this document, in These proposed changes are made for how best to ensure that dietary our response to question 9 of the ingredients and dietary supplements ease of use and clarity. CGMP ANPRM, this proposed CGMP rule exported to the United States have been regulations will be found more easily if would apply to a wide variety of manufactured, packaged, and held located in one part, part 111, and clarity activities associated with the consistent with part 111. will be enhanced by using subparts to This proposal does not include organize categorical CGMP practices. manufacture, packaging, and holding of requirements for safety testing in Similarly, restrictions for substances dietary ingredients and dietary animals and humans for certain types of used in dietary supplements will be supplement products. These activities dietary ingredients and dietary found more easily if located in one part, include labeling, testing, quality control, supplements. As discussed in several part 112, and clarity will be enhanced holding, and distribution. For example, parts of this preamble, you are if the restrictions for substances used in if you contract with a manufacturer to responsible for ensuring that the dietary dietary supplements are located in one perform an operation subject to ingredients or dietary supplements that subpart, subpart C. proposed part 111, you will need to you make are safe prior to marketing The proposed part 111 consists of comply with those regulations directly such products. Although we are eight subparts. Several of the proposed applicable to the operation that you focusing on the manufacturing steps in provisions in the CGMP regulations for perform. For example, if you are a firm actual production and distribution of dietary ingredients and dietary that has contracted with a dietary dietary ingredients and dietary supplements are similar to the CGMP supplement manufacturer to package a supplements, there may be the need for regulations for food products at part dietary supplement, you are responsible specific regulations related to the use of 110. However, we edited the text in for complying with all the regulations, animal tissue. We invite comment on many cases to make the proposed rule including recordkeeping, that would whether there is a need for such specific easier to read and to understand otherwise be required of a manufacturer regulations. consistent with plain language who does its own onsite packaging. principles under the presidential Further, if you are a manufacturer and III. Description of the Proposed Rule memorandum of June 1, 1998 (Ref. 43). you contract with a firm to perform a This proposal will supercede what the Some provisions are derived from the particular manufacturing step, you agency said about the placement in Title industry outline that we included in the would remain responsible for ensuring 21 of the Code of Federal Regulations ANPRM; others are derived from that such step is done in a manner that for any regulations resulting from the comments we received on the ANPRM complies with the requirements in proposed rule for dietary supplements or from our outreach efforts described proposed part 111. As in the previous containing ephedrine alkaloids (62 FR previously. We also developed example, a manufacturer who contracts 30678, June 4, 1997). That proposal provisions based on our knowledge and with a firm to package a product is still included proposed revisions of part 111 expertise in the areas of dietary responsible for the actions of its and the table of contents for part 111 supplements, manufacturing, and contractor for the packaging activities and we are now proposing those for 21 contamination. and must ensure that its contractor CFR part 112 (as explained below). We tentatively decided to exclude complies with the applicable CGMP This proposal for dietary supplement certain CGMP requirements in part 110 regulations. CGMPs amends part 111 (21 CFR part for food products because they do not Proposed part 111 also would apply 111), revising the heading from ‘‘Current appear to be appropriate for dietary to foreign firms that manufacture, Good Manufacturing Practice for Dietary ingredients and dietary supplements. package, or hold dietary ingredients and Supplements’’ to ‘‘Current Good There are differences in the nature of dietary supplements that are imported Manufacturing Practice in the product (i.e., conventional food or offered for import into the United Manufacturing, Packing, or Holding versus dietary ingredients or dietary States, unless imported for further Dietary Ingredients and Dietary supplements) and in the manufacturing processing and export under section Supplements.’’ Proposed part 111, with practices used to produce the product 801(d)(3) of the act, to persons who the heading ‘‘Current Good that require specific practices distribute such imported dietary Manufacturing Practice in appropriate for dietary ingredients and ingredients and dietary supplements, Manufacturing, Packing, or Holding dietary supplements. We invite and to persons who export dietary Dietary Ingredients and Dietary comment on whether any provision ingredients and dietary supplements Supplements,’’ includes only the CGMP from part 110 that we have not included from the United States, unless exported for dietary supplements and the table of should be included in this proposed in compliance with section 801(e). contents contains categorical CGMP CGMP for dietary ingredients and One comment to the ANPRM, relating practices in subparts A through H. dietary supplements. to the scope of the CGMPs, requested an Further, we propose the heading and exemption from the CGMP for table of contents for part 112. Proposed A. General Provisions (Proposed ‘‘herbalist’’ practitioners who part 112 has the heading ‘‘Restrictions Subpart A) individually manufacture dietary for Substances Used in Dietary Proposed subpart A contains five supplements for their clients. Supplements.’’ The table of contents for provisions that would provide basic We decline to exempt herbalist proposed part 112 includes: Subpart A information to the reader. practitioners from the proposed rule. If

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an herbalist practitioner introduces or supplements that it makes. Thus, under specified time period according to a delivers for introduction into interstate the proposed CGMPs, a dietary single manufacturing record during the commerce, a dietary ingredient or supplement with a particular dietary same cycle of manufacture.’’ dietary supplement, that practitioner ingredient listed on its label must The phrase ‘‘identity, purity, quality, must use the same good manufacturing contain that particular dietary strength, and composition,’’ means that practices as other manufacturers to ingredient. Moreover, that dietary the production on a batch-by-batch basis ensure that their clients receive dietary ingredient must meet certain is consistent with the master supplements that are not adulterated. specifications that the manufacturer manufacturing record and is what it is The risks of adulteration are not establishes as to the purity, quality, represented on the label to be (identity); eliminated just because the practitioner strength, and composition. CGMPs are is without impurities and is the desired is an herbalist. Therefore, we decline to intended to ensure that a dietary product (purity); is the identity, purity, exempt ‘‘herbalist’’ practitioners who supplement contains what the label says and strength for its intended purpose manufacture dietary ingredients and it contains. If it does not, the dietary (quality); is the concentration, that is, dietary supplements. Herbalist supplement would not only be the amount per unit of use intended practitioners who introduce or deliver misbranded under section 403 of the (strength); and is the intended mix of for introduction into interstate act, but also would be adulterated under product and product-related substances commerce, a dietary ingredient or section 402(g) of the act. (composition). dietary supplement, are manufacturers Proposed § 111.3 defines ‘‘batch 3. What Definitions Apply to This Part? who must meet CGMPs. number, lot number, or control number’’ (Proposed § 111.3) as ‘‘any distinctive group of letters, 2. What Are These Regulations Intended Proposed § 111.3 defines various numbers, or symbols, or any To Accomplish? (Proposed § 111.2) terms used in proposed part 111. In combination of them, from which the Proposed § 111.2, entitled ‘‘What are general, we have used definitions that complete history of the manufacturing, these regulations intended to are similar to definitions in part 110 for packaging, or holding of a batch or lot accomplish?’’ discusses the purpose of food and other CGMP regulations. of dietary ingredients or dietary the CGMP regulations. The proposal However, we have modified some supplements can be determined.’’ You states that the regulations establish the definitions for ‘‘plain language’’ should note that the proposed definition minimum CGMPs that you must use to purposes under the presidential ‘‘plain would have the batch, lot, or control the extent that you manufacture, language’’ memorandum (Ref. 43) and to number be ‘‘distinctive,’’ which means, package, or hold a dietary ingredient or make other definitions more appropriate for the purposes of this proposal, that it dietary supplement. By using the phrase for dietary ingredients and dietary is unique in some fashion, and is not a ‘‘to the extent,’’ we mean that you must supplements. reused number. Numbers must be comply with the provisions that are In some cases, we based a definition distinctive because, if a problem applicable to you or to the operations on provisions in the industry outline involving a marketed dietary ingredient that you perform and that, depending on published in the ANPRM. However, we or dietary supplement later results, a the type of operations you perform, did not adopt all of the definitions in distinctive batch number will make it some provisions may not apply to you. the industry outline. For example, the possible for you to investigate the For example, some provisions discuss industry outline defined terms such as, source of the problem and the requirements for automatic, mechanical, ‘‘adequate,’’ ‘‘composition,’’ ‘‘raw manufacturing history for the batch. and electronic equipment; if you do not material,’’ ‘‘representable sample,’’ and This would help you to take appropriate use such equipment, you would not ‘‘rework.’’ We omitted those definitions actions concerning that batch more have to comply with those provisions. from this proposal because the terms are quickly. Our primary purpose in proposing generally understood, or because Proposed § 111.3 defines these regulations is to protect definitions for those terms are ‘‘component’’ as ‘‘any substance consumers from adulterated and unnecessary for purposes of intended for use in the manufacture of misbranded dietary supplements due to understanding the proposed rule. a dietary ingredient or dietary improper manufacturing, packaging, or Proposed § 111.3 states that the supplement including those that may holding practices. By observing CGMP definitions and interpretations of terms not appear in the finished dietary regulations that require that dietary in section 201 of the act apply to such ingredient or dietary supplement.’’ ingredients and dietary supplements are terms when used in these regulations. Proposed § 111.3 states that manufactured, packaged, or held in a Section 201 of the act defines various ‘‘component’’ includes ingredients and controlled environment, manufacturers terms that appear throughout the act, dietary ingredients as described in can ensure that dietary ingredients and including ‘‘dietary supplement’’ (see section 201(ff) of the act. Under dietary supplements are not adulterated section 201(ff) of the act). Other terms proposed § 111.3, components would or misbranded during manufacturing, in section 201 of the act, such as ‘‘label’’ include ingredients, dietary ingredients, packaging, and holding operations. (section 201(k) of the act) and ‘‘pesticide manufacturing aids (such as solvents Manufacturing, packaging, and holding chemical’’ (section 201(q)(1) of the act), that are removed during manufacturing), dietary ingredients and dietary have a long history of use. The and reagents that are used to synthesize supplements under CGMPs will provide definitions and interpretations of such a product. consumers with greater confidence that terms apply when we use those terms in Under the proposed definition of dietary supplements contain the dietary this rule. ‘‘component,’’ a component may or may ingredients that they are supposed to Proposed § 111.3 defines specific not appear in the finished product. For contain and that these dietary terms used in the proposal. example, solvents that are used to ingredients were evaluated for their Proposed § 111.3 defines ‘‘batch’’ as produce herbal extracts do not identity, purity, quality, strength, or ‘‘a specific quantity of a dietary necessarily appear in a finished dietary composition. The CGMP regulations, if ingredient or dietary supplement that is supplement, but the proposed rule still finalized as proposed, would require a intended to meet specifications for would consider the solvents to be manufacturer to establish specifications identity, purity, quality, strength, and ‘‘components.’’ As another example, for the dietary ingredients and dietary composition, and is produced during a ingredients, such as cellulose (which is

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used to make tablets) or gelatin (which aristolochic acid would not be ingredients are components but not all is used to make capsules), might be used considered a ‘‘consumer complaint.’’ components are ingredients. to produce dietary supplements; these We consider that a dietary supplement Proposed § 111.3 defines ‘‘in-process ingredients remain in the finished containing a dietary ingredient such as material’’ as ‘‘any material that is product, but would be ‘‘components’’ aristolochic acid, a substance that is fabricated, compounded, blended, under the proposed rule. nephrotoxic and carcinogenic, is ground, extracted, sifted, sterilized, Proposed § 111.3 defines ‘‘consumer adulterated under section 402(a)(1), derived by chemical reaction, or complaint’’ as: (f)(1)(A), and (f)(1)(D) of the act. processed in any other way for use in * * * communication that contains any Proposed § 111.3 defines ‘‘contact the manufacture of a dietary ingredient allegation, written or oral, expressing surface’’ as: or dietary supplement.’’ In-process material differs from a component dissatisfaction with the quality of a dietary * * * any surface that contacts a component, ingredient or a dietary supplement related to dietary ingredient, or dietary supplement, because in-process material is created good manufacturing practices. Examples of and those surfaces from which drainage onto and used during manufacturing. For product quality related to good the component, dietary ingredient, or dietary example, assume you manufacture a manufacturing practices are: Foul odor, off supplement, or onto surfaces that contact the dietary supplement in hard tablet form. taste, superpotent, subpotent, wrong component, dietary ingredient, or dietary During the manufacturing process, you ingredient, drug contaminant, other supplement ordinarily occurs during the mix various ingredients, and you add contaminant (e.g., bacteria, pesticide, normal course of operations. mycotoxin, glass, lead), disintegration time, binding agents and water to mix the color variation, tablet size or size variation, Proposed § 111.3 gives some examples ingredients thoroughly before making under-filled container, foreign material in a of contact surfaces, such as containers, individual tablets. The mixture would dietary supplement container, improper utensils, tables, contact surfaces of be an ‘‘in-process material’’ because it is packaging, or mislabeling. For the purposes equipment, and packaging. Under the a blend or processed material that you of this regulation, a consumer complaint proposed definition the term drainage will use to make your dietary about product quality may or may not includes both liquid and dry materials. supplement. include concerns about a possible hazard to The proposed definition of ‘‘contact Proposed § 111.3 defines ‘‘lot’’ to health, which would include a consumer mean: complaint. However, a consumer complaint surface’’ is similar to the definition of does not include an adverse event, illness, or ‘‘food-contact surface’’ in § 110.3(g), * * * a batch, or a specific identified portion injury related to the safety of a particular except we have used the terms of a batch intended to have uniform identity, dietary ingredient independent of whether ‘‘component, dietary ingredient, or purity, quality, strength, and composition; or, the product is produced under good dietary supplement’’ instead of food, in the case of dietary ingredient or dietary manufacturing practices. and we have added several examples of supplement produced by continuous process, a specific identified amount produced in a Communication about prices, package contact surfaces. The proposed specified unit of time or quantity in a manner size or shape, or other matters that definition would include the inside of that is intended to have uniform identity, could not possibly reveal the existence containers. purity, quality, strength, and composition. of a hazard to health or do not concern Proposed § 111.3 defines ‘‘ingredient’’ The proposed definition for ‘‘lot’’ is the appearance, taste, odor, or quality of as ‘‘any substance that is used in the similar to the definition for ‘‘lot’’ in the a dietary ingredient or a dietary manufacture of a dietary ingredient or a proposed CGMP regulations for infant supplement are not considered dietary supplement that is intended to formula (61 FR 36154 at 36209, July 9, ‘‘consumer complaints’’ under the be present in the finished dietary 1996), but would refer to ‘‘identity, proposed rule. Consumer complaints ingredient or dietary supplement.’’ The purity, quality, strength, and related to an illness or injury related to proposed definition would explain that composition’’ instead of ‘‘character and a pharmacologically active substance of an ingredient ‘‘includes, but is not quality’’ to reflect the different a dietary ingredient such as aristolochic necessarily limited to, a dietary characteristics of dietary ingredients acid would not be related to good ingredient as described in section and dietary supplements. manufacturing practices. The use of 201(ff) of the act.’’ Thus, under Proposed § 111.3 defines products containing aristolochic acid proposed § 111.3, an ‘‘ingredient’’ may ‘‘microorganisms’’ as ‘‘yeasts, molds, has resulted in several life-threatening be a substance that is present in the bacteria, viruses, and other similar adverse incidents. Aristolochic acids are finished dietary ingredient or dietary microscopic organisms having public potent carcinogens and nephrotoxins supplement that is intended to have health or sanitary concern.’’ The that are present, primarily, in plants of some activity (such as a vitamin, proposed definition would include, but the family Aristolochiaceae. A product mineral, or amino acid), but could also would not be limited to, species that: that contains a large amount of it may be a substance that is not intended to • Have public health significance; result in the rapid onset of acute toxicity have any activity (such as the gelatin • Could cause a component, dietary symptoms in a consumer using the used to make the capsule holding the ingredient, or dietary supplement to product. A product containing a small dietary ingredients). This proposed decompose; amount could be used for years with no definition and the proposed definition • Indicate that the component, apparent adverse effects, until serious, for ‘‘component’’ in proposed § 111.3 dietary ingredient, or dietary irreversible effects, such as renal failure, differ in that ‘‘component’’ includes the supplement is contaminated with filth; has occurred. Such adverse effects are various materials used to manufacture a or related to a pharmacologically active dietary supplement that may not appear • Otherwise may cause the substance of a particular dietary in the final product. Because an component, dietary ingredient, or ingredient, aristolochic acid. Thus, for ingredient is defined as a substance that dietary supplement to be adulterated. the purpose of this regulation, a is intended to be present in the finished The definition of ‘‘microorganisms’’ communication from a consumer that dietary ingredient or dietary supplement includes microorganisms of public contains any allegation, written or oral, and a component is defined as a health concern and microorganisms that related to the safety of the use of a substance that may or may not be are of sanitary concern. Proposed product because it contained a included in the finished dietary § 111.3 is similar to the definition of particular dietary ingredient, e.g., ingredient or dietary supplement, all microorganism in § 110.3 but we added

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‘‘sanitary concern’’ to the definition of in this proposed rule because mites are risk using a contaminated component or microorganism. We added ‘‘sanitary’’ to capable of causing allergic reactions in dietary ingredient in manufacturing and clarify that we intend to include persons who consume mite- you may distribute an adulterated microorganisms of public health and contaminated foods (Ref. 44). dietary ingredient or dietary sanitary concern. Although the term Proposed § 111.3 defines ‘‘physical supplement. ‘‘sanitary’’ is not included in part 110, plant’’ as ‘‘all or parts of a building or Proposed § 111.3 defines this change does not alter the generally facility used for or in connection with ‘‘reprocessing’’ as: recognized and scientific and legal manufacturing, packaging, or holding a * * * using, in the manufacture of a dietary meaning of the definition of dietary ingredient or a dietary ingredient or a dietary supplement, clean, ‘‘microorganism’’ in part 110, because supplement.’’ The proposed definition unadulterated components, dietary part 110 is similarly concerned with is similar to the definition of ‘‘plant’’ at ingredients, or dietary supplements that have sanitation. Under proposed § 111.3, E. § 110.3(k), except that we added the been previously removed from coli O157:H7 would be a word ‘‘physical’’ before ‘‘plant’’ to manufacturing for reasons other than ‘‘microorganism’’ because it is a species distinguish between plants that are insanitary conditions and that have been that has public health significance. herbs, vegetables, and growing made suitable for use in the manufacture of Other forms of E. coli, however, might organisms, and buildings or facilities a dietary ingredient or dietary supplement. not be of public health significance that are used in manufacturing, The phrase ‘‘for reasons other than because not all forms of E. coli are packaging, and holding a dietary insanitary conditions’’ means that the pathogenic and present a public health ingredient or a dietary supplement. We component, dietary ingredient, or risk. However, the presence of other also expanded the definition to cover dietary supplement was removed from forms of E. coli would be of sanitary the types of activities that would be manufacturing because the incorrect concern. subject to a CGMP rule for dietary amount of a component was added or One comment to the ANPRM objected ingredients and dietary supplements. other reason not due to insanitary to including viruses in a definition of Proposed § 111.3 defines ‘‘quality conditions. However, the component, ‘‘microorganisms’’ because it might control’’ as ‘‘a planned and systematic dietary ingredient, or dietary imply that a manufacturer is able to operation or procedure for preventing a supplement that was removed from demonstrate the absence of viral dietary ingredient or dietary supplement manufacturing because it became contamination in its dietary from being adulterated.’’ A planned and contaminated because of insanitary supplement. systematic operation or procedure conditions, that is, it became We recognize that there are few provides a framework of current and contaminated with a microorganism of effective virus detection methods and effective methods and procedures for public health concern or a that the industry may be incapable of each dietary ingredient or dietary microorganism of sanitary concern, showing the presence or absence of supplement you manufacture that will must not be reprocessed. specific viruses in its products. prevent dietary ingredients and dietary Proposed § 111.3 defines ‘‘sanitize’’ However, we have included viruses in supplements from being adulterated. We as: the definition for ‘‘microorganisms’’ discuss quality control in more detail because animal tissues are used in the later in this document. * * * to adequately treat equipment Proposed § 111.3 defines ‘‘quality containers, utensils, or any other dietary manufacture of dietary supplements, product contact surface by applying and the use of virus-containing tissue control unit’’ as ‘‘any person or group cumulative heat or chemicals on cleaned would adulterate the product. In order that you designate to be responsible for food contact surfaces that when evaluated for to ensure that animal tissue that may be quality control operations.’’ The quality efficacy, yield a reduction of 5 logs, which used in or as a dietary ingredient does control unit should consist of as many is equal to 99.999 percent reduction, of not contain viruses of public health people as necessary to perform the representative disease microorganisms of significance, certain precautions may be quality control operations. Other public health significance and substantially needed to be taken in procuring and provisions in this proposed rule address reduce the numbers of other undesirable handling such tissue. We discuss in the quality control unit’s authority and microorganisms, but without adversely section III.A.4 of this document what responsibilities, and we discuss those affecting the product or its safety for the consumer. precautions we are seeking comment on provisions later in this document. that manufacturers take to prevent the Proposed § 111.3 defines One comment to the ANPRM pointed use of tissue that may contain viruses of ‘‘representative sample’’ as ‘‘a sample out that the industry-drafted outline’s public health significance for dietary that consists of a number of units that definition of sanitize differed from ingredient or dietary supplement are drawn based on rational criteria, FDA’s Food Code definition of manufacture or to prevent the such as random sampling, and intended sanitization (Ref. 45). introduction of such viruses into a to ensure that the sample accurately The FDA ‘‘Food Code’’ is a reference dietary ingredient or a dietary portrays the material being sampled.’’ that guides retail outlets, such as supplement. By stating that the ‘‘sample accurately restaurants and grocery stores and Proposed § 111.3 defines ‘‘must’’ to portrays the material being sampled,’’ institutions such as nursing homes in indicate that you have to comply with we mean that it correctly represents and how to prevent foodborne illnesses from a particular requirement. ‘‘Must’’ is the is typical of the material being sampled. food that is consumed without further plain language term that replaces It is important that the sample drawn processing by the consumer. Because ‘‘shall.’’ accurately portrays the material being dietary supplements also are consumed Proposed § 111.3 defines ‘‘pest’’ as sampled because your analysis of the without further processing by the ‘‘any objectionable insects or other representative sample will be used to consumer, the FDA ‘‘Food Code’’ animals including, but not limited to, determine whether the material received definition also is appropriate for use in birds, rodents, flies, mites, and larvae.’’ is suitable for use in manufacturing or sanitizing contact surfaces used in the Proposed § 111.3 is similar to § 110.3(j), to determine that the dietary ingredient manufacture of dietary ingredients and although the proposed definition would or dietary supplement is not adulterated dietary supplements. The FDA ‘‘Food add ‘‘mites’’ to the list of pests. We and may be released for distribution. If Code’’ definition of sanitization is to added mites to the definition of ‘‘pest’’ the sample is not representative, you apply cumulative heat or chemicals on

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cleaned food contact surfaces that when ingredient, or dietary supplement and is as required by part 123 as well as these evaluated for efficacy, yield a reduction the quotient of the water vapor pressure CGMP provisions, if this rule is of 5 logs, which is equal to 99.999 of the substance divided by the vapor finalized, that apply to the dietary percent reduction of representative pressure of pure water at the same supplement. These other statutory disease microorganisms of public health temperature.’’ The proposed definition provisions and regulations may apply significance. Because dietary is consistent with the definition at because of the type of manufacturing supplements are consumed without § 110.3(r) and 21 CFR 113.5(w) and process used or the type of ingredient in further processing, and for consistency 114.5(h). Water activity can play an the dietary supplement. with other agency definitions and important role in promoting microbial Certain dietary ingredients, e.g., an standards, we are persuaded to propose growth, and that, in turn, can play a part animal-derived ingredient, may require the FDA ‘‘Food Code’’ definition of in the contamination of your certain manufacturing, packaging, and ‘‘sanitize.’’ The agency believes that components, dietary ingredients, and holding practices because, without such there may be a number of agents that dietary supplements. practices, they may pose serious public can reduce the number of Proposed § 111.3 defines ‘‘we’’ as health and safety concerns related to the microorganisms present on contact meaning the U.S. Food and Drug transmission of communicable disease. surfaces. A tolerable level of risk may be Administration. For purposes of this discussion, the achieved by interventions that have Proposed § 111.3 defines ‘‘you’’ as ‘‘a term ‘‘animal-derived dietary been validated to achieve a cumulative person who manufactures, packages, or ingredient’’ refers to materials, 5-log reduction in the target pathogens. holds dietary ingredients or dietary substances, tissues, body fluids, or body However, we do not specify the manner supplements.’’ ‘‘You’’ is the secretions from animals, birds, reptiles, in which the risk is reduced. The recommended ‘‘plain language’’ term insects, and other living creatures and proposed requirement mandates that designed to make regulations easier to substances that may be derived from you validate that the control measures understand. In this proposed rule, them. We do not consider human are both appropriate to their operation ‘‘you’’ refers to any person, within the tissues and other parts of humans, other and scientifically sound. In many cases, meaning of section 201(e) of the act, than human milk, to be eligible to be a processors may rely on a written who engages in any activity covered by dietary ingredient under section 201(ff) certification from the equipment this proposed rule. You should note that of the act because such products have manufacturer or may obtain a written ‘‘you’’ includes, but is not limited to, not been used as a ‘‘dietary substance scientific evaluation of a process, the owner of the manufacturing firm as for use by man to supplement the diet especially in cases where two or more well as supervisors responsible for by increasing the total dietary intake’’ control measures are used to accomplish ensuring that these CGMPs are followed. (21 U.S.C. 321(ff)(1)(E)). the 5-log reduction in the target In other words, ‘‘you’’ can be the person Certain animal-derived dietary pathogen, to ensure that the process is who owns the dietary ingredient or ingredients, as well as the handling adequate to destroy microorganisms of dietary supplement company as well as practices associated with such public health significance or to prevent persons who work for the company. ingredients, may pose serious public health and safety risks, and therefore, their growth. The agency requests 4. Do Other Statutory Provisions and may require regulations. Animal- comments on its approach to pathogen Regulations Apply? (Proposed § 111.5) reduction. In particular, the agency derived materials, substances, and requests comments on whether all Proposed § 111.5 would require that tissues have the potential to cause contact surfaces should be subject to you comply with the regulations in serious illnesses or injuries when proposed § 111.3 ‘‘sanitize.’’ proposed part 111, and with other ingested. For example, bovine colostrum Proposed § 111.3 defines ‘‘theoretical applicable statutory provisions, and is a substance that is used in dietary yield’’ as ‘‘the quantity that would be regulations under the act, related to supplements (Ref. 46). Bovine colostrum produced at any appropriate step of manufacturing, packaging, or holding which is the lacteal secretion which manufacture or packaging of a particular dietary ingredients or dietary precedes milk after a cow gives birth, dietary ingredient or dietary supplements. Other statutory provisions likely presents the same potential health supplement, based upon the quantity of or regulations that may apply to the risks as does milk. Bovine milk may components or packaging to be used, in manufacture, packaging, or holding of contain pathogenic organisms capable of the absence of any loss or error in actual dietary ingredients or dietary causing diseases in man such as production.’’ We would complement supplements include, but are not tuberculosis, undulant fever, and this definition by defining ‘‘actual limited to: (1) The PHS Act to prevent gastrointestinal disease (Ref. 47). Such yield’’ in proposed § 111.3 as ‘‘the the introduction, transmission, or milk must be pasteurized in accordance quantity that is actually produced at any spread of communicable diseases; (2) with 21 CFR 1240.61. We have proposed appropriate step of manufacture or part 110 (‘‘Current Good Manufacturing a specific requirement at § 111.65(c)(5) packaging of a particular dietary Practice in Manufacturing, Packing, or that would require that you sterilize, ingredient or dietary supplement.’’ Holding Human Food’’); (3) part 113 (21 pasteurize, freeze, refrigerate, control Comparing theoretical yields to actual CFR part 113) (‘‘Thermally Processed hydrogen-ion concentration (pH), yields may help identify deviations or Low-Acid Foods Packaged in control humidity, control water activity, problems in the manufacturing or Hermetically Sealed Containers’’); (4) or use any other effective means to packaging process. To illustrate this part 123 (21 CFR part 123) (‘‘Fish and remove, destroy, or prevent the growth point, you should understand that the Fishery Products’’); (5) parts 70 through of microorganisms and to prevent theoretical yield is the quantity or 82 (21 CFR parts 70 through 82) (for decomposition. This requirement, amount that you expect to see at a color additives); and (6) parts 170 which would apply to bovine colostrum particular step, while the actual yield is through 189 (21 CFR parts 170 through for use in a dietary supplement, is the quantity or amount that you actually 189) (for food additives). For example, necessary to remove certain potential obtain at a particular step. a manufacturer who produces a dietary health risks. Milk also may contain Proposed § 111.3 defines ‘‘water supplement that includes fish and contaminants, such as drug residues if activity’’ as ‘‘a measure of the free fishery products, such as fish oil, would the cow has been treated with such moisture in a component, dietary have to comply with HACCP regulations substances prior to beginning lactation,

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that can cause serious adverse health is no broadly applicable or validated comment on whether there are animal- effects in humans consuming the diagnostic test available to derived materials from BSE countries colostrum (Ref. 48). For example, if the manufacturers to identify BSE agent that do not present a safety concern and, colostrum contains drug residues, a infected ruminant animals or BSE agent if so, whether FDA should consider dietary supplement containing infected materials, the agency is exempting such materials from a colostrum could cause an adverse effect considering whether to require, in our possible requirement that would in a person who is allergic to the drug final rule, specific requirements under prevent the use of animal-derived residue. In addition, some dietary proposed § 111.35 that are designed to materials from BSE countries in dietary supplements contain raw brain tissue or prevent the use of materials derived supplements and why. The agency will glands (Ref. 49) that have a high risk of from certain animals from regions (‘‘BSE consider whether to include, in the final containing the infective agent that Countries’’) identified in 9 CFR 94.18. rule, provisions specifically related to causes bovine spongiform Such requirements would likely include the manufacture, packaging, and encephalopathy (BSE) if they originate manufacturer procedures and records holding of animal-derived dietary from an animal infected with the and supplier certifications to ensure that ingredients or dietary supplements. One disease (Ref. 37). In fact, dietary a component, dietary ingredient, or of the more obvious and serious hazards ingredients derived from different wild dietary supplement is free of the agent is the transmission of TSE (Ref. 37). We and domesticated animals may present of BSE. To prevent use of BSE agent- have communicated with the public and microbiological and contaminant contaminated components, dietary manufacturers of FDA-regulated hazards that are unique to animal- ingredients, or dietary supplements, products about appropriate steps to derived dietary ingredients simply requirements for supplier certifications increase product safety and minimize because the ingredient may not be would likely include certification: the risk of products contaminated with amenable to physical treatments (for • Of the species of animal, the BSE agent. We published a notice in example, sterilization to eliminate • Of the geographic origin of the the Federal Register of August 29, 1994 pathogens) or there may not be animal, (59 FR 44592), entitled ‘‘Bovine-Derived appropriate methods to identify or • That no BSE was present in any of Materials; Agency Letters to correct a potential risk (as in the case of the animals in the herd from which the Manufacturers of FDA-Regulated BSE or other transmissible spongiform animal came and that none of the Products’’ (Ref. 50). The notice, in part, encephalopathies (TSEs)). animals from the herd consumed published the November 1992 and The PHS Act is intended to prevent mammalian-derived protein prohibited December 1993 letters to manufacturers. the introduction, transmission, or from use in ruminant feed, In November 1992, we wrote to spread of communicable diseases (42 • That any foreign manufacturer from manufacturers of dietary supplements to U.S.C. 264). Dietary supplements may which the material derived from alert them to the developing concern be regulated under the PHS Act to the animals was obtained: about TSEs in animals and Creutzfeldt- extent necessary to prevent the 1. Did not co-mingle material derived Jakob Disease in humans and introduction, transmission, or spread of from animals from BSE countries with recommended that they investigate the communicable diseases in intrastate and material derived from animals from geographic source of any bovine and interstate commerce. Dietary non-BSE countries, ovine material used in their products. supplements that contain animal- 2. Established, validated, and We suggested that manufacturers derived ingredients may carry infective followed plans or procedures to develop plans to ensure, with a high agents that may not be able to be identify, track, and segregate material degree of certainty, that bovine and identified or that may be resistant to derived from animals from BSE ovine materials used in their products inactivation, as described previously. countries from material derived from were not from BSE countries or from We are not aware of dietary supplement animals from non-BSE countries, and sheep flocks (foreign or domestic) manufacturers’ current procurement and 3. Used dedicated manufacturing infected with scrapie. In December handling practices of such dietary operations to prevent co-mingling of 1993, we issued a letter recommending ingredients, nor the extent to which materials derived from animals from against the use of bovine-derived such dietary ingredients may be used. BSE countries with materials derived materials from cattle that resided in, or However, because the animal-derived from animals from non-BSE countries. originated from, BSE countries in FDA- dietary ingredients present important Manufacturers that rely on supplier regulated products. In this letter, we public health and safety issues, we are certifications to ensure that materials recommended that manufacturers: (1) seeking comment on whether we should derived from animals are BSE-free Identify bovine-derived materials in include in the final rule specific would likely need to verify the their products and identify all countries requirements for manufacturing, reliability of supplier certifications by where the animals used to produce the packaging, or holding animal-derived conducting supplier audits at materials had lived, (2) maintain dietary ingredients. The U.S. appropriate intervals. We invite traceable records for each lot of bovine Department of Agriculture (USDA) has comment on whether there are other materials and for each lot of FDA- imposed certain restrictions (see 9 CFR requirements that should be considered regulated product using these materials, 94.18) on importation from certain by FDA for supplier certification or (3) document the country of origin of regions of meat and edible products other manufacturing requirements to the live animal source of any bovine- from certain animals. The USDA has prevent the use of BSE agent- derived materials used in the determined that these regions present an contaminated components, dietary manufacture of the regulated products, undue risk of introducing BSE into the ingredients, or dietary supplements. and (4) maintain copies of the records United States because BSE exists in the These specific requirements may be identified above for FDA-regulated regions, because the regions have import issued under the authority of the act or products manufactured using bovine- requirements less restrictive than those may need to be issued under PHS Act derived materials at foreign sites or by that would be acceptable for import into authority and may need to include foreign manufacturers. To assure the the United States, and/or because of relevant remedies available under the safety and suitability for human use of inadequate surveillance. Because there PHS Act. In addition, we invite animal-derived biologics, our Center for

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Biologics Evaluation and Research contamination in dietary ingredients who might be a source of microbial (CBER) has developed guidances for and dietary supplements. Nevertheless, contamination of any material including industry that describe steps that the proposal does not contain components, dietary ingredients, dietary manufacturers should take. For requirements for persons handling such supplements, or contact surfaces used in example, CBER guidances have commodities before distribution to a the manufacture, packaging, or holding recommendations that address viral dietary ingredient or dietary supplement of a dietary ingredient or a dietary safety, infections, disease risks, and manufacturer because the scientific supplement. We based proposed BSE-risk reduction of biologic products basis for reducing or eliminating § 111.10(a) on similar requirements in that are animal-derived (see 63 FR pathogens in various settings is § 110.10. 51074, September 24, 1998, and 63 FR evolving. We invite comments on Proposed § 111.10(a)(1) would require 50244, September 21, 1998) (Refs. 51 whether we should include provisions that you exclude any person who, by and 52). Because we believe that the use in the CGMP proposal that would medical examination or supervisory of an animal-derived material, include persons who handle raw observation, is shown to have, or substance, or tissue in a dietary agricultural commodities. appears to have an illness, open lesion supplement may raise many of the same Even though the proposed rule would (such as a boil, sore, or an infected serious public health and safety issues not cover persons who harvest or wound), or any other abnormal source as animal-derived materials, substances, otherwise handle raw agricultural of microbial contamination from any or tissues, in a biologic, we are commodities before distribution of these operations, which may be expected to considering whether the procedures that commodities to a dietary ingredient or result in microbial contamination of CBER recommends for a product with dietary supplement manufacturer, we components, dietary ingredients, dietary animal-derived materials, substances, or recommend some practices to help you supplements, or contact surfaces, from tissues would be appropriate for dietary minimize microbial food safety hazards working in any operations until the ingredients and dietary supplements in such commodities that you may use condition is corrected. For example, if that contain animal-derived materials, in a dietary ingredient or dietary an employee tells you that his or her substances, or tissues. We, therefore, supplement. We recommend that you physician has diagnosed that the invite comment on whether there adapt, to your practices, the good employee has a fever, and the employee should be specific CGMP requirements agricultural practices (GAPs) and good normally handles your dietary for the use of animal-derived materials, manufacturing practices for fruits and supplements, you must take steps to substances, or tissues in dietary vegetables that we issued as a guidance ensure that the employee does not come ingredients and dietary supplements. document: ‘‘Guide to Minimize into contact with your dietary We invite comment on these issues and Microbial Food Safety Hazards for Fresh supplements because the fever may specifically on whether there is a Fruits and Vegetables’’ (Ref. 53). This suggest that the employee has an scientific basis for FDA to treat animal- guidance document includes infection and there is a reasonable derived dietary ingredients in a manner recommended GAPs for water, worker possibility of contamination. Likewise, that is different from, or that would offer health and hygiene, sanitary facilities, if your supervisors see that an employee less protection than, what is field sanitation, packing, and has an open wound or sore, and the recommended for animal-derived transportation. Those who harvest, employee normally handles dietary biologics when the same public health store, or distribute raw agricultural ingredients, you must take steps to and safety risks may be present. We also commodities for incorporation into ensure that he or she is excluded from invite comment on our legal authority dietary ingredients or dietary handling dietary ingredients because the with respect to these issues. supplements should adapt these open wound or sore could be a source practices to their specific operations. of microbial contamination and because 5. Exclusions (Proposed § 111.6) there is a reasonable possibility of Proposed § 111.6 would state that B. Personnel (Proposed Subpart B) contamination. these CGMP regulations do not apply to Proposed subpart B contains three Proposed § 111.10(a)(2) would require a person engaged solely in activities provisions dealing with personnel that you instruct your employees to related to the harvesting, storage, or matters. In general, the proposed notify their supervisor(s) if they have, or distribution of raw agricultural provisions are similar to the current if there is a reasonable possibility that commodities that will be incorporated CGMP requirements for food personnel they have, a health condition that could into a dietary ingredient or dietary in § 110.10. contaminate any components, dietary supplement by other persons. This ingredients, dietary supplements, or any 1. What Microbial Contamination and proposed exclusion is similar to the contact surface. exclusion in § 110.19 for raw Hygiene Requirements Apply? Proposed § 111.10(b) would apply if agricultural commodities. Accordingly, (Proposed § 111.10) you work in operations where persons who engage in such activities Individuals who handle components adulteration of components, dietary related to raw agricultural commodities or dietary supplements may affect the ingredients, dietary supplements, or (which are defined in section 201(r) of purity or quality of those components or contact surfaces may occur. The the act), although not subject to these dietary supplements if they fail to take proposal would require that you use proposed CGMP regulations under precautions to guard against microbial hygienic practices to the extent section 402(g) of the act, would contamination or other types of necessary to protect against continue to be subject to other contamination. For example, an contamination of those components, adulteration provisions in section 402 of employee who has an illness could dietary ingredients, dietary the act. unintentionally transfer bacteria or supplements, or contact surfaces. We recognize that including in the viruses causing such illness to a dietary These hygienic practices would proposed rule persons who engage in supplement by simply handling the include, but would not be limited to: the activities related to the harvesting, dietary supplement. • Wearing outer garments in a storage, or distribution of such Proposed § 111.10(a), therefore, would manner that protects against commodities, as described previously, require that you take measures to contamination of components, dietary could reduce the risk of microbial exclude from any operations any person ingredients, dietary supplements, or any

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contact surface. Outer garments may establish and follow written procedures must apply to all operations where a include gowns or aprons; to ensure that you comply with the person may contaminate a component, • Maintaining adequate personal requirements of that section. As stated dietary ingredient, dietary supplement, cleanliness; previously, we invite comment on or contact surface. For example, an • Washing hands thoroughly (and whether such written procedures should employee could contaminate a dietary sanitizing if necessary to protect against be required in a final rule, and whether supplement (of agricultural origin or contamination with microorganisms) in there are other procedures, that we synthetic origin) or contact surface an adequate hand-washing facility: should include in a final rule. If during packaging operations. However, 1. Before starting work; and comments assert that written procedures if we adopted the comment’s suggested 2. At any time when hands may are necessary, comments should include limitation, contamination of a synthetic become soiled or contaminated. Hands an explanation of why the requirement dietary supplement could occur, and may become soiled or contaminated is necessary to prevent adulteration there would be no regulatory after meals or after using the bathroom; including how such a requirement requirement to guard against such • Removing all unsecured jewelry would ensure the identity, purity, contamination. and other objects that might fall into quality, strength, and composition of the As for employees with open wounds, components, dietary ingredients, dietary dietary ingredient or dietary proposed § 111.10(a) would require that supplements, equipment, or packaging, supplement. Conversely, if comments you exclude a person with an open and removing hand jewelry that cannot assert that written procedures are not lesion or any other abnormal source of be adequately sanitized during periods necessary, comments should include an microbial contamination from any when you manipulate components, explanation of why the requirement is operation which may adulterate the dietary ingredients, or dietary not necessary including how, in the component, dietary ingredient, dietary supplements by hand. If the hand absence of the requirement, one can supplement, or contact surface. Whether jewelry cannot be removed, the proposal prevent adulteration and ensure the the proposed rule would require that would require that it be covered by identity, purity, quality, strength, and you exclude a person with an open material that is intact, clean, and in composition of the dietary ingredient or lesion or another abnormal source of sanitary condition that effectively dietary supplement. Further, we seek microbial contamination from working protects against contamination of your comment on whether any of the in a closed system area, such as when components, dietary ingredients, or proposed requirements in this section the product is contained completely in dietary supplements, or contact are not necessary to prevent closed pipes or vessels, would depend surfaces. adulteration and to ensure the identity, on whether, as a result of exposure, • Maintaining gloves used in purity, quality, strength, and there would be a reasonable possibility handling components, dietary composition of the dietary ingredient or of the component, dietary ingredient, ingredients, or dietary supplements in dietary supplement. If comments assert dietary supplement, or contact surface an intact, clean, and sanitary condition; that certain provisions are not becoming contaminated. Thus, when a • Wearing, where appropriate, in an necessary, comments should include an dietary ingredient or dietary supplement effective manner, hair nets, caps, beard explanation of why the requirement is is manufactured in a completely closed covers, or other hair restraints; not necessary including how, in the system, this proposed requirement on • Not storing clothing or other absence of the requirement, one can open lesions might not apply if there is no reasonable possibility of personal belongings in areas where prevent adulteration and ensure the contamination. However, you must take components, dietary ingredients, dietary identity, purity, quality, strength, and the measures that would be required by supplements, or any contact surfaces are composition of the dietary ingredient or § 111.10(a) if there is a reasonable exposed or where contact surfaces are dietary supplement. If comments agree possibility that any person might cause washed; that the proposed requirements are contamination of components, dietary • Not eating food, chewing gum, necessary for reasons other than those ingredient, dietary supplements, or drinking beverages, and using tobacco we have provided, the comments should so state and provide an explanation. contact surfaces. products in areas where components, A comment to the ANPRM stated that Comments to the personnel dietary ingredients, dietary any requirements on disease control provisions, and other provisions, stated supplements, or any contact surfaces are should be limited to manufacturing, that the industry-drafted outline used exposed or where contact surfaces are processing, and handling of raw phrases such as ‘‘includes, but are not washed; and • agricultural material and are not limited to,’’ when giving examples of Taking any other necessary appropriate for manufacturing dietary how to comply with various precautions to protect against supplements derived from chemicals. requirements. The comments suggested contamination of components, dietary The comment stated that chemical that this phrase be changed to ‘‘may ingredients, dietary supplements, or processes are carried out in closed pipes include’’ to clarify that items that follow contact surfaces by microorganisms, and vessels, so the risk for human the phrase are simply examples of how filth, or other extraneous materials, contamination is very low. The to comply with a particular requirement including, but not limited to, comment, therefore, said that FDA and are not binding or do not represent perspiration, hair, cosmetics, tobacco, should allow workers who have wounds an exhaustive list of examples. chemicals, and medicines applied to the to continue working in manufacturing We decline to draft the proposal as skin. operations. suggested by the comments because we Each of these procedures is necessary We disagree that the regulations on do not agree that when we state because good personal hygiene should disease control should be limited to ‘‘includes, but are not limited to,’’ we help prevent contamination from manufacturing, processing, and are providing examples of how to microbial sources (such as bacteria) as handling raw agricultural material. comply with the regulations. When we well as from nonmicrobial sources (such Because contamination may occur at state that a regulation requires a as dirt and hair). any time during manufacturing, manufacturer, packager, or holder to We seek comment on whether we packaging, or holding operations, establish certain practices which should require, in a final rule, that you requirements concerning disease control ‘‘includes, but is not limited to’’ a list

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of procedures or activities, we are ingredients during batch production to have experience or training on the stating that compliance with the should have sufficient training or job, but also require that the employee regulation requires that you adopt, at expertise to perform those functions. If have the appropriate educational the minimum, the procedures or that employee does not know how to background, for example, to understand activities listed in the regulation. measure correctly, the employee may the significance of using a particular test Therefore, when we state ‘‘includes, but add too much of an active ingredient, method or understanding the is not limited to,’’ we mean that the list which may cause the product to be significance of a processing deviation of procedures or activities following the adulterated. Thus, proposed § 111.12 and how to respond to such deviation. ‘‘includes’’ statement is a list of would establish requirements for your The word ‘‘and’’ includes situations requirements. employees. where on-the-job training may be We invite comment on whether we adequate and also situations where 2. What Personnel Qualification should require, in a final rule, a educational training may be required. Requirements Apply? (Proposed requirement that you document and Therefore, proposed § 111.12(a)(2) refers § 111.12) keep records regarding each employee’s to ‘‘training and experience.’’ Proposed § 111.12 would establish training. We believe that the records, if basic qualification requirements for required, should show the content and 3. What Supervisor Requirements employees. Proposed § 111.12(a)(1) date of the training. Such records may Apply? (Proposed § 111.13) would require that you have qualified be useful in determining whether an Proposed § 111.13 would establish employees to manufacture, package, or employee has received the training general supervision requirements and is hold dietary ingredients or dietary necessary to perform his or her duties. similar to a provision that appeared in supplements. We are not proposing a We invite comment on not only whether the industry-drafted outline. Proposed general standard for determining how such records should be required in a § 111.13(a) would require that you many employees are necessary, but final rule, but also what types of clearly assign to qualified supervisory there should be enough to manufacture, information such records should personnel the responsibility for package, or hold dietary ingredients or contain. ensuring that all CGMP requirements in dietary supplements consistent with You may use consultants to advise part 111 are met. You should assign an these proposed CGMPs. A one-person you on any aspect of the manufacture, adequate number of qualified personnel operation is not precluded provided that packaging, or holding of dietary to supervise the manufacturing, one person is sufficient to achieve, ingredients or dietary supplements. Any packaging, or holding of dietary maintain, and document CGMPs. consultant you use should be qualified ingredients and dietary supplements. However, general manufacturing by training and experience to provide We are not proposing a general standard practice suggests the need for a the advice they give to you. We invite for determining how many supervisors minimum of two persons, the first to comment on whether we should require, are necessary and a one-person perform the work and a second person in a final rule, that you document each operation is not precluded provided that to check the work performed to ensure consultant’s name, address, and one person is sufficient to supervise that a manufacturing deviation or an qualifications and include a description CGMPs. As stated previously, we invite unanticipated occurrence is not of the services that the consultant comment on whether there is a overlooked. However, we leave the provided. Such records may assist you minimum number of qualified determination of the actual number of in knowing who to contact and where personnel to supervise the employees necessary to your discretion. to contact him or her if questions arise manufacturing, packaging, or holding of As stated previously, we invite concerning the advice given. dietary ingredients or dietary comment on whether there is a A comment to the ANPRM suggested supplements. Proposed § 111.13(b) minimum number of employees needed that the employee qualification would require you and your supervisors to manufacture dietary ingredients or requirements in the industry outline to be qualified by training and dietary supplements. should, in part, state that ‘‘proper experience to supervise. Proposed § 111.12(a)(2) would require education, training, or experience’’ is Making supervisors responsible for that each person engaged in required instead of ‘‘proper education, compliance with the regulations would manufacturing, packaging, or holding training, and experience’’ is required be an important step in manufacturing, must have the training and experience (emphasis added). packaging, and holding dietary to perform the person’s duties. Training We disagree with the use of ‘‘or’’ ingredients and dietary supplements is necessary to ensure that employees instead of ‘‘and.’’ We omitted the term under conditions that will not cause know how to correctly and fully ‘‘proper education’’ because ‘‘training’’ adulteration and misbranding. We perform the operations in question and may be considered a form of believe that clearly designating to ensure that the employees are ‘‘education.’’ However, the proposed compliance responsibilities to competent to produce an unadulterated rule uses the conjunction ‘‘and’’ individuals increases the likelihood of product. The extent and frequency of because, while some might consider compliance with the regulations. the training is left to the manufacturer’s ‘‘experience’’ to be a form of ‘‘training,’’ One comment to the ANPRM discretion. The extent and frequency of most consider ‘‘experience’’ to be questioned why supervisory personnel training needed for your employees will knowledge that a person gains over time must be ‘‘qualified’’ when the food depend on the scope of the employee’s as he or she becomes increasingly CGMP regulations require supervisory activities and experience. For example, familiar with a particular action or piece personnel to be ‘‘competent’’ (see training may be necessary when you of equipment. § 110.10(d)). hire new employees, when employees Training, however, may not just We consider the terms to be engage in new activities, when your include on-the-job training, but may equivalent in this case. The Webster’s II physical plant implements new include some type of educational New Riverside University Dictionary manufacturing practices, or when you experience derived from attending defines competent as ‘‘able to perform add new equipment or new processes to classes or lectures or some other formal as required: competent’’ and further manufacturing. For example, an instruction on a particular subject. Some defines ‘‘qualified’’ as ‘‘having met the employee responsible for measuring positions not only require the employee requirements for a specific position or

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task’’ (Ref. 54). Therefore, we consider constitute a source of contamination in microorganisms of public health the words ‘‘qualified’’ and ‘‘competent’’ areas where food is exposed; significance and are safe and adequate in proposed § 111.13 and § 110.10(d), • Adequately draining areas that may under their conditions of use. Such respectively, should be considered contribute to the contamination to food verification may include buying these synonymous. by seepage, filth, other extraneous substances under a supplier’s guarantee Another comment to the ANPRM materials, or by providing a breeding or certification or you may examine questioned making supervisors place for pests; and them for contamination. • responsible for ensuring compliance by Adequately operating systems for Several comments on the industry all personnel with all CGMP waste treatment and disposal in an outline published in the ANPRM requirements. The comment stated that adequate manner so that they do not objected to the idea that compliance absolute compliance with each and constitute a source of contamination in ‘‘may be verified by any effective means every CGMP requirement cannot be areas where food is exposed. including purchase of these substances ensured, but that requiring a supervisor For example, rodents, insects, and other under a supplier’s guarantee or to be responsible may make the pests may be attracted to garbage, and if certification, or examination of these supervisor personally liable in the event you do not take adequate steps to substances for contamination.’’ The of noncompliance. remove or dispose of garbage, you may comments stated that such language is Proposed § 111.13(a) would require be risking contamination from those unnecessary and may be interpreted as that manufacturers assign responsibility rodents, insects, or other pests. Rodents, too restrictive and that manufacturers to qualified supervisory personnel. insects, and other pests are sources of should be able to determine the Doing so will help ensure that the feces, hair, and other potential appropriate means of assuring CGMPs are followed. In general, if the contaminants (Refs. 55 and 56). We compliance. proposed rule is finalized, invite comment on whether we should We agree with the comments that you manufacturers, packagers, and holders require, in a final rule, that you take may determine the appropriate means of would be responsible for complying these steps and/or other steps to protect assuring compliance with this with these CGMP requirements and for against contamination. regulation. The proposed rule would not ensuring that they assign responsibility 1. What Sanitation Requirements Apply require that you follow any particular to qualified supervisors. We consider to Your Physical Plant? (Proposed method for assuring compliance; many factors when we take enforcement § 111.15) instead, the proposal would give you the flexibility to decide how to ensure action, and so the facts surrounding a Proposed § 111.15(a), like § 110.35(a), that your cleaning compounds and CGMP violation will influence the type would require that you keep your sanitizing agents are free from of enforcement action we take. The physical plant in a clean and sanitary contamination and are safe and manufacturer is responsible under condition and in sufficient repair to adequate under the conditions of use. § 111.13(a) for ensuring that qualified prevent contamination of components, Proposed § 111.15(b)(2) would require supervisory personnel are assigned to dietary ingredients, dietary that you not use or hold toxic materials oversee the implementation of these supplements, or contact surfaces. For in a physical plant in which contact CGMPs. example, holes in your physical plant’s surfaces, components, dietary C. Physical Plant (Proposed Subpart C) walls or windows could allow pests or contaminants to enter, so proposed ingredients or dietary supplements are Proposed subpart C consists of § 111.15(a) would require that you manufactured or exposed, unless those provisions intended to help prevent toxic materials are necessary: repair those holes. • contamination from your physical plant. Proposed § 111.15(b) pertains to To maintain clean and sanitary These provisions are similar to the food conditions, cleaning compounds, sanitizing agents, • CGMP requirements found in §§ 110.20, and pesticides you use. The proposal is For use in laboratory testing 110.35, and 110.37 which pertain to similar to § 110.35(b) and, in essence, procedures, • buildings and facilities. would require that you use cleaning For maintaining or operating the We have not proposed requirements compounds and sanitizing agents that physical plant or equipment, or • similar to the food CGMP requirements are free from microorganisms of public For use in the physical plant’s found in § 110.20(a) for keeping the health significance and are safe and operations. grounds bordering your physical plant adequate under the conditions of use. If at least one of the listed conditions is in a condition that protects against By saying that the cleaning compounds not met, you must not use or hold the contamination of components, dietary and sanitizing agents should be ‘‘free toxic material because there would be ingredients, or dietary supplements. In from microorganisms,’’ we mean that no reason to risk contamination from order to limit the burden to your use of those cleaning compounds exposure to such material if it is not manufacturers, FDA is not proposing and sanitizing agents should not necessary to your operations. such requirements. However, we invite contaminate your components, dietary Proposed § 111.15(b)(3) would require comment on whether such requirements ingredients, dietary supplements, or that you identify and hold toxic should be included in a final rule. contact surfaces with microorganisms. cleaning compounds, sanitizing agents, Section § 110.20(a), identifies several We are proposing this requirement pesticides, and pesticide chemicals in a methods necessary for adequate ground because microorganisms, if present in manner that protects against maintenance, such as: your cleaning compounds or sanitizing contamination of components, dietary • Properly storing equipment, agents, can contaminate your contact ingredients, dietary supplements, and removing litter and waste, and cutting surfaces or deactivate the sanitizing contact surfaces. You must take steps to weeds or grass within the immediate agent and, as a result, adulterate your store your toxic materials in a way that vicinity of your physical plant so that it components, dietary ingredients, dietary prevents them from contaminating your does not attract pests, harbor pests, or be supplements, or contact surfaces. We dietary ingredients and dietary used by pests for breeding; advise that you should verify that supplements. If such products were • Maintaining roads, yards, and cleaning compounds and sanitizing stored in manufacturing areas or where parking lots so that they do not agents are free from contamination by dietary ingredients or dietary

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supplements may be otherwise exposed of adequate sanitary quality,’’ at suitable regulations. Proposed § 111.15(d) to such products, those toxic materials temperatures and under pressure as provides you with the flexibility to raise may come in contact with the dietary needed in all areas where water is your water quality above the minimum ingredients or dietary supplements and necessary for: criteria to meet your particular thereby contaminate them. In addition, • Manufacturing dietary ingredients manufacturing needs. We acknowledge clearly identifying the containers in or dietary supplements; that foreign firms may not be subject to which such toxic materials are held will • Making ice that comes into contact EPA water requirements or adhere to prevent accidental use. with components, dietary ingredients, EPA requirements. Nevertheless, water One comment to the ANPRM objected dietary supplements, or contact quality is an important part of CGMPs, to the provision in the industry outline surfaces; so we invite comment on our proposed that would require manufacturers to • Cleaning surfaces; and requirement that does not distinguish register and use rodenticides, • Employee bathrooms and hand between foreign or domestic insecticides, and fungicides in washing facilities. requirements, and, therefore, would accordance with the Federal Insecticide, Proposed § 111.15(d)(2) would require require foreign firms to meet the NPDW Fungicide, and Rodenticide Act and to that water that contacts components, regulations. follow all relevant Federal, State, and dietary ingredients, dietary A number of comments to the local government requirements. The supplements, or any contact surfaces, at ANPRM suggested that we should comment said the requirement would be a minimum, comply with the National require the use of potable water (water that is fit to drink) or a higher quality redundant with other regulations. Primary Drinking Water (NPDW) Although this CGMP proposed rule water or establish potable water as the regulations prescribed by the does not propose a requirement that you minimum quality water standard. One Environmental Protection Agency (EPA) follow all relevant Federal, State, and comment stated that the industry and any State and local government local government requirements when outline, by referring to potable water, requirements. (EPA’s NPDW regulations applying, using, or holding toxic prevents the use of water whose quality can be found at 40 CFR part 141.) cleaning compounds, sanitizing agents, exceeded a potable water standard Proposed § 111.15(d) would require and pesticides, the proposed rule does because a higher quality water would that you use water that is of safe and not relieve you from such obligations. not be in compliance. Proposed § 111.15(c) pertains to pests. sanitary quality in all aspects of your We agree that potable water should be Proposed § 111.15(c)(1) would require operation where, if such water was not a minimum water quality standard, and that you exclude animals or pests from used, could result in contamination and proposed § 111.15(d) would reflect that all areas of your physical plant, while adulteration of your dietary ingredients standard. Proposed § 111.15(d)(1) would proposed § 111.15(c)(2) would require and dietary supplements. Further, under require water to be ‘‘safe and of that you take effective measures to proposed § 111.15(d)(2), in any adequate sanitary quality.’’ Water that is exclude pests from your physical plant operation where water contacts ‘‘safe and of adequate sanitary quality’’ and to protect against the contamination components, dietary ingredients, dietary is or should be potable. Proposed of components, dietary ingredients, supplements or any contact surfaces, the § 111.15(d)(2) would require water that dietary supplements, or contact water must comply with the EPA’s contacts components, dietary surfaces. Therefore, if you have pests in NPDW regulations. We believe that the ingredients, dietary supplements, or your physical plant, you must take EPA’s NPDW water regulations are contact surfaces to meet, at a minimum, immediate action to get rid of them. In necessary because contaminated water EPA’s NPDW regulations and State and addition, you must take measures to can contaminate dietary ingredients and local requirements. Water meeting these prevent those and any other type of dietary supplements both when used as requirements is potable. pests from entering your physical plant. an ingredient in the dietary ingredient Please note that proposed § 111.15(d) You should note that, like § 110.35(d), or dietary supplement and when does not prevent you from using water proposed § 111.15(c)(1) would allow contaminated water is allowed to enter that is more pure or of higher quality guard dogs and guide dogs in your the product indirectly, as can occur, for than that required under EPA’s NPDW physical plant if their presence will not example, when water is used to cool a regulations. We reiterate that proposed result in the contamination of product or to clean a contact surface. § 111.15(d) would establish minimum components, dietary ingredients, dietary We recognize that, for some water quality standards. supplements, or contact surfaces. operations, you may want to use water Proposed § 111.15(d) does not make Proposed § 111.15(c)(3) would require that is more pure or of higher quality any distinctions between water from that you not use insecticides, fumigants, than that required under the NPDW public sources and water from private fungicides, or rodenticides unless you regulations. For example, to ensure the sources. Consequently, if you use water take precautions to protect against purity of your dietary supplements, you from private sources, you would need to contamination of your components, might use water that has gone through ensure that the water meets the dietary ingredients, dietary water purification and filtering minimum water quality standards in supplements, or contact surfaces. For equipment to ensure that the water is proposed § 111.15(d). For example, if example, some pesticides may cause clean and sterile. In contrast, to clean you use a well as your water source, you adverse effects in humans, so you must contact surfaces and other surfaces, would need to ensure that the well take precautions to ensure that any sterilized water may be unnecessary design meets government water quality pesticides you use will not contaminate because a contact surface that is standards and you may need to perform your components, dietary ingredients, exposed to the environment will not appropriate water treatment procedures, dietary supplements, or contact remain sterile; airborne microorganisms including filtration, sedimentation, and surfaces. and microorganisms on your employees chlorination. These actions are Proposed § 111.15(d) would apply to will find their way onto the contact necessary because private water sources, water supplies and is patterned after the surface, thereby rendering it nonsterile. such as surface waters or water from food CGMP requirement at § 110.37(a). Proposed § 111.15(d) would not prevent shallow wells, may be subject to Proposed § 111.15(d)(1) would require you from using water that is more pure microbiological, chemical, or that you provide water that is ‘‘safe and than that required under the NPDW radiological contamination. For

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example, fertilizer runoff can enter § 111.15(e) would require your physical § 111.15(d) would not require water to streams and contaminate surface water. plant’s plumbing to be adequate size be available in all parts of a physical Contaminants in the ground may enter and design and to be adequately plant. In areas where water is a well and contaminate well water. installed and maintained to: unnecessary, we would not expect you Therefore, it is important that water • Carry sufficient amounts of water to to make water available or to have any from any source comply with the required locations throughout the particular quantity of volume of water requirements set out in proposed physical plant; available. However, there are areas § 111.15(d). • Properly convey sewage and liquid where water is necessary to ensure that Another comment to the ANPRM disposable waste from your physical any unadulterated dietary ingredient or suggested that a potable water standard plant; dietary supplement is manufactured, is inappropriate for use in • Avoid being a source of packaged or held. In those areas where manufacturing dietary ingredients and contamination to components, dietary water is necessary, your plumbing must dietary supplements from chemicals. ingredients, dietary supplements, water carry sufficient amounts to those The comment would limit the use of supplies, or any contact surface, or locations. potable water to manufacturing, creating an unsanitary condition; Proposed § 111.15(f) would require processing, and handling of vegetables, • Provide adequate floor drainage in that you dispose your physical plant’s ready-cooked dishes, etc. all areas where floors are subject to sewage into an adequate sewage system We disagree with the comment. If flooding-cleaning or where normal or through other adequate means. This water is not suitable for drinking operations release or discharge water or proposed provision is similar to the (nonpotable), the water may contain other liquid waste on the floor; and sewage provisions at § 110.37(c). Proper microorganisms or contaminants that • Not allow backflow from, or cross- sewage disposal is essential to ensure will contaminate your dietary connection between, piping system that that you maintain your manufacturing ingredients or dietary supplements. For discharge waste water or sewage and facility in a sanitary condition, and this example, water from private sources piping systems that carry water used for would include protecting the processing may be untreated, so it may be manufacturing dietary ingredients or environment against pathogenic contaminated by pesticides due to water dietary supplements, or cleaning contact microorganisms shed in fecal material. runoff from fields or may contain surfaces, or for use in bathrooms and For example, bathroom floors can microorganisms, algae, particulates, etc. hand washing facilities. become contaminated with pathogens if Therefore, proposed § 111.15(d) would This provision is intended to ensure your sewage disposal system fails to require that you use water that is of safe that your plumbing system does not remove fecal material. Employees using and sanitary quality, regardless of adversely effect the water in your those bathrooms, in turn, can transport whether you use natural or synthetic physical plant. If the plumbing system those pathogens into your processing components to make dietary ingredients is not adequately installed and areas and contaminate components, and dietary supplements. maintained, it may contaminate your dietary ingredients, dietary Proposed § 111.15(d)(3) would require water supply and, in turn, contaminate supplements, or contact surfaces. that you have documentation or your components, dietary ingredients, Proposed § 111.15(g) would apply to otherwise be able to show that the water and dietary supplements through direct bathrooms. Proposed § 111.15(g) would that contacts components, dietary contact, such as when you use water to require that you have adequate, readily ingredients, dietary supplements, or any make the products, or indirect contact, accessible bathrooms for your contact surface meets the water quality such as when the contaminated water is employees and require that the standard in proposed § 111.15(d)(2). The used on a contact surface. bathrooms be kept clean and not proposal would not prescribe any In addition to the water directly become a potential source of particular type of documentation or contaminating your components, dietary contamination to your components, method for showing water quality, but ingredients, dietary supplements, or dietary ingredients, dietary you should remember that water is used contact surfaces, standing water can supplements, or contact surfaces. The as a component in manufacturing cause contamination by attracting pests proposal would require that you keep dietary ingredients and dietary or becoming a breeding ground for your bathrooms from becoming supplements would fall within the microorganisms. Therefore, the proposal potential sources of contamination. You definition of ‘‘component,’’ so it should would require your plumbing system to would be required to keep the meet whatever specifications you have adequate drainage and would not bathrooms in good repair at all times, establish for component identity, purity, allow backflows or cross-connections in provide self-closing doors, and provide quality, strength, and composition. We your plumbing system because doors that do not open into areas where discuss requirements for the identity, backflows from a nonpotable water components, dietary ingredients, dietary purity, quality, strength, and system to a potable water system under supplements, or contact surfaces are composition of components later in this negative pressure conditions could exposed to airborne contamination, section when we describe proposed contaminate your water system (Ref. except where you have taken other § 111.35, ‘‘What production and process 57). means (such as double doors or positive controls must you use?’’. Proposed A comment to the ANPRM stated that airflow systems) to protect against § 111.15(d)(3) would be similar to a requiring a physical plant’s plumbing to airborne contamination. provision in the drug CGMP regulation carry sufficient amounts of water to Proposed § 111.15(h) applies to hand at 21 CFR 211.48(a) and the proposed required locations throughout the plant washing facilities. The proposal would requirement in the infant formula was too vague. The comment stated the require that you provide adequate and proposed rule (61 FR 36154 at 36211), water is not needed in many operations convenient hand washing facilities that which requires that water meet EPA’s in the plant, and so firms should be able furnish running water at a suitable drinking water requirements in 40 CFR to decide the location and availability of temperature. Proposed § 111.15(h)(1) part 141. water throughout their own physical would require that you have hand Proposed § 111.15(e) is similar to the plants. washing facilities and, where plumbing requirements in the food The comment may have appropriate, hand sanitizing facilities at CGMPs at § 110.37(b). Proposed misinterpreted the ANPRM. Proposed each location in your physical plant

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where good hygienic practices require recontamination of clean, sanitized assert that written procedures are your employees to wash or sanitize (or hands. For example, if sanitized hands necessary, comments should include an to both wash and sanitize) their hands. are necessary at a particular location, explanation of why the requirement is One comment to the ANPRM you might install hand sanitizing necessary to prevent adulteration suggested that, instead of requiring facilities that can be activated by foot including how such a requirement employees to wash ‘‘and/or’’ sanitize pedals or by motion so that your would ensure the identity, purity, their hands, we should require employees do not have to use their quality, strength, and composition of the employees to wash ‘‘or’’ sanitize their hands—and, by doing so, risk dietary ingredient or dietary hands. contaminating their hands—to turn on supplement. Conversely, if comments We disagree with the comments. In the hand sanitizing equipment. assert that written procedures are not some cases, it is necessary to both wash Proposed § 111.15(h)(5) would require necessary, comments should include an and sanitize the hands. Sanitizing that you have easily-understood signs explanation of why the requirement is which generally refers to the removal or and to post them throughout your not necessary including how, in the elimination of living microorganisms, physical plant to direct your employees absence of the requirement, one can may be more effective if the hands are who handle components, dietary prevent adulteration and ensure the washed before they are sanitized, and ingredients, dietary supplements, or identity, purity, quality, strength, and washing, alone, will not sanitize the contact surfaces to wash and, where composition of the dietary ingredient or hands. Therefore, the proposed rule appropriate, sanitize their hands: dietary supplement. would address situations where good • Before they start work, We invite comment on whether • hygienic practices require employees to After each absence from their duty documentation at the time of wash or sanitize their hands or to wash station, and performance of equipment, utensil, and • and sanitize their hands. When their hands may have become contact surface maintenance, cleaning, Proposed § 111.15(h)(2) and (h)(3) soiled or contaminated. and sanitation and keeping such records would require that you provide effective Proposed § 111.15(h)(6) would require should be required in a final rule. This hand-cleaning and sanitizing that you have trash bins that are would give you a record that you would preparations and air driers, sanitary constructed and maintained in a manner be able to consult if any questions towel service, or other suitable drying to protect against recontamination of regarding maintenance, cleaning, and devices. Disposable paper towels would hands and contamination of sanitation of equipment used in be an example of sanitary towel service. components, dietary ingredients, dietary producing the batch arise. We seek One comment to the ANPRM supplements, or any contact surface. comment on whether any of the suggested replacing ‘‘effective hand- The proposal would not specify any proposed requirements in this section cleaning and sanitizing preparation’’ particular type of trash bin to use. are not necessary to prevent with ‘‘commonly available’’ hand- Proposed § 111.15(i) applies to trash adulteration and to ensure the identity, washing and sanitizing preparations. disposal. The proposal would require purity, quality, strength, and We disagree with the comment. The that you convey, store, and dispose of composition of the dietary ingredient or purpose behind proposed § 111.15(h)(2) trash to minimize the development of dietary supplement. If comments assert is to ensure that hand-cleaning and odors; to minimize the potential for that certain provisions are not sanitizing preparations are effective. trash to attract, harbor, or become a necessary, comments should include an While we have objection to the use of breeding place for pests; to protect explanation of why the requirement is ‘‘commonly available’’ hand-washing against contamination of components, not necessary including how, in the and sanitizing preparations if they are dietary ingredients, dietary absence of the requirement, one can ‘‘effective,’’ the effectiveness of the supplements, any contact surface, water prevent adulteration and ensure the hand-washing and sanitizing supplies, and grounds surrounding your identity, purity, quality, strength, and preparation is essential to ensuring that physical plant and to control hazardous composition of the dietary ingredient or the hand-washing and sanitizing waste to prevent contamination of dietary supplement. If comments agree preparation will prevent adulteration of components, dietary supplements, and that the proposed requirements are the product. contact surfaces. necessary for reasons other than those Another comment to the ANPRM Proposed § 111.15(j) would require we have provided, the comments should suggested that a dietary supplement that you assign one or more employees so state and provide an explanation. CGMP rule mention paper towels as a to supervise overall sanitation. Under the proposal, the employee or 2. What Design and Construction hand drying device. Requirements Apply to Your Physical We have drafted proposed employees would have to be qualified Plant? (Proposed § 111.20) § 111.15(h)(3) to identity disposable by training and experience to develop paper towels as an example of sanitary and supervise sanitation procedures. Proposed § 111.20 would describe the towel service. However, under proposed The proposal would give you discretion general requirements for physical plant § 111.15(h)(3), the paper towels must be in deciding how many employees you construction and design that are both sanitary and disposable. need to assign to supervise overall necessary to protect dietary ingredients Another comment to the ANPRM sanitation of your physical plant. As and dietary supplements from becoming suggested that paper towels used in previously discussed, the proposed adulterated during manufacturing, hand-washing facilities should be made requirement does not preclude the packaging, and holding. from recycled paper. possibility of a one-person operation. If Proposed § 111.20(a) would require We take no position regarding the use you are a one-person operation, you any physical plant you use in the of paper towels made from recycled would need to be qualified by training manufacturing, packaging, or holding of paper. The proposal neither requires nor and experience to develop and perform dietary ingredients or dietary prohibits the use of paper towels made all sanitation procedures. supplements to be suitable in size, from recycled paper. We invite comment on whether construction, and design to facilitate Proposed § 111.15(h)(4) would require written procedures for maintenance, maintenance, cleaning, and sanitizing that you provide devices or fixtures that cleaning, and sanitation should be operations. You should note that are constructed to prevent required in a final rule. If comments proposed § 111.20(a) refers to cleaning

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operations and to sanitizing operations. the mixer will contaminate the next However, if your physical plant does Although these terms appear to be batch of ingredients that go into the not allow for physically separate areas, similar, they are distinct in the sense mixer. you would have to develop an that a sanitizing operation usually Proposed § 111.20(c) would require alternative approach for segregating produces a sterile (free of living your physical plant to permit the use of components, dietary ingredients, and microorganisms) environment whereas a proper precautions to reduce the dietary supplements at points when cleaning operation may not. To potential for mixups or contamination they are received, stored, and rejected. illustrate the difference, if you wipe a of components, dietary ingredients, Proposed § 111.20(d) would require contact surface with a wet cloth to dietary supplements, or contact that your physical plant be designed remove any components or dietary surfaces, with microorganisms, and constructed in a manner that ingredients, you would have engaged in chemicals, filth, or other extraneous prevents contamination of components, a cleaning operation. The contact material. The proposal would require dietary ingredients, dietary surface is free of noticeable debris, but the physical plant to have, and require supplements, or contact surfaces. The it might still contain microorganisms. In that you use, separate or defined areas proposal would require that the design contrast, if you used a disinfectant on of adequate size or other control and construction include floors, walls, the contact surface in order to eliminate systems, such as computerized and ceilings that are of smooth and hard any possible microorganisms on that inventory controls or automated systems surfaces that may be adequately cleaned surface, you would have engaged in a of separation, to prevent contamination and kept clean and in good repair. sanitizing operation. and mixups of components, dietary Smooth, hard surfaces are necessary Size, construction, and design of a ingredients, and dietary supplements because they are easier to clean and physical plant are important to during specific operations. The specific sanitize than those surfaces that are not manufacturing, packaging, and holding operations would be listed at proposed smooth and hard. The proposal also dietary ingredients and dietary § 111.20(c)(1) through (c)(7) and are as would require that you use fixtures, supplements that are not adulterated follows: ducts, and pipes that do not because they can help you identify and • Receiving, identifying, holding, and contaminate components, dietary eliminate possible sources of withholding from use, components, ingredients, dietary supplements, or contamination that result in or may lead dietary ingredients, dietary contact surfaces by dripping or to adulteration. For example, supplements, packaging, and labels that condensate. Condensation may contain condensation can occur on water pipes. will be used in or during the microorganisms or contaminants that If these pipes are exposed and run above manufacturing, packaging, or holding of can contaminate your components, a contact surface, condensation from dietary ingredients and dietary dietary ingredients, dietary those pipes may fall onto the contact supplements; supplements, or contact surfaces. surface and adulterate your dietary • Separating, as necessary, Proposed § 111.20(d) also would ingredients or dietary supplements. So, components, dietary ingredients, dietary require your physical plant’s design and if you design your physical plant to supplements, packaging, and labels that construction to: • eliminate exposed pipes or to shield are to be used from components, dietary Use adequate ventilation or your contact surfaces from ingredients, dietary supplements, environmental control equipment, such condensation, you would eliminate a packaging, or labels that are awaiting as air flow systems, including filters, possible source of adulteration. material review and disposition fans, and other air-blowing equipment, As another example, you might find it decision, reprocessing, or are awaiting that minimize odors and vapors more practical to clean certain floors in disposal after rejection; (including steam and noxious fumes) in your physical plant by spraying them • Separating the manufacturing, areas where they may contaminate with water. Obviously, a floor design packaging, and holding of different components, dietary ingredients, dietary that uses floor drains would facilitate product types, including, but not supplements or contact surfaces. the cleaning of those floors. limited to, different types of dietary Adequate ventilation or environmental Proposed § 111.20(b) would require ingredients, dietary supplements, and control equipment is a necessary part of your physical plant to have adequate other foods, cosmetics, and your physical plant’s design and space for the orderly placement of pharmaceutical products; construction because some equipment and holding of materials as • Performing laboratory analyses and contaminants and microorganisms may is necessary for maintenance, cleaning, holding laboratory supplies and be airborne, so a failure to provide and sanitizing operations and to prevent samples; adequate ventilation will increase your contamination and mixups of • Cleaning and sanitizing contact chances of airborne contamination. In components, dietary ingredients, and surfaces; addition, some potentially harmful dietary supplements during • Packaging and label operations; and gases (such as carbon monoxide and manufacturing, packaging, or holding. • Holding dietary ingredients or carbon dioxide) are colorless and Adequate space for the orderly dietary supplements. odorless, so it is important to have a placement of equipment and holding of The proposal would not specify the ventilation or environmental control materials is important because it can types of precautions your physical plant system that minimizes odors and directly affect your ability to maintain, must have to reduce the potential for vapors; clean, or sanitize your equipment or mixups or contamination. The • Use fans and other air-blowing physical plant effectively. For example, precautions may depend on your equipment located and operated in a assume that your manufacturing physical plant and the products you manner that minimizes the potential for operation involves the use of a large make. For example, depending on your microorganisms and particulate matter mixer. However, the mixer is installed physical plant’s size and layout, you to contaminate components, dietary in a small room which makes it difficult may be able to receive components and ingredients, dietary supplements, or to open the mixer fully. This may make dietary ingredients at one location, hold contact surfaces; it difficult for you to maintain and clean them in another location and store • Use equipment to control the mixer properly and, as a result, may rejected components and dietary temperature and humidity. For example, increase the possibility that residues in ingredients in yet another location. high temperatures may stimulate

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reproduction of microorganisms and Proposed § 111.20(g) would require • Equipment using compressed air or pests, and these microorganisms and that your physical plant provide gas; pests may, in turn, contaminate your protection by any effective means • Equipment used to carry out components, dietary ingredients, dietary against contamination of components, processes in closed pipes and vessels; supplements, and contact surfaces; and dietary ingredients, and dietary and • Include aisles or working spaces supplements in bulk fermentation • Equipment used in automatic, between equipment and walls that are vessels. The proposal describes some mechanical, or electronic systems. adequately unobstructed and of means to consider, such as using To show how proposed § 111.25(a)(1) adequate width to permit all persons to protective coverings, placement in areas might apply, assume that you use a perform their duties and to protect where you can eliminate harborages for mixer to blend powdered ingredients. If against contamination of components, pests over and around vessels, placing the mixer blade is too small, it might not dietary ingredients, dietary bulk fermentation vessels in areas where mix the ingredients properly or supplements, or contact surfaces with you can check regularly for pests, pest thoroughly, and the resulting batches clothing or personal contact. For infestation, filth, or other extraneous might be adulterated if the ingredients example, your employees will perform material, and using skimming are not provided at the required levels their duties more efficiently and more equipment. You must protect throughout the batch. In this example, effectively if they have sufficient space components, dietary ingredients, and the mixer was not suited for its intended to perform those duties. The clothing dietary supplements held in bulk use. As another example, if your worn by your employees will be less fermentation vessels because, if the manufacturing equipment is so complex likely to be a source of contamination if contents of a bulk fermentation vessel or designed in a way that makes there is sufficient space between your are contaminated, those contaminated cleaning difficult, any unclean surfaces employees and your components, contents may be used to make many on that equipment could become a dietary ingredients, dietary dietary ingredients or dietary source of contamination in the future. In supplements, or contact surfaces. supplements that, as a result, would be this case, the equipment was not Proposed § 111.20(e) would require adulterated. adequately cleaned and properly your physical plant to provide adequate Proposed § 111.20(h) would require maintained or, alternatively, was not of light in all areas where components, your physical plant to include adequate appropriate design for its intended uses. dietary ingredients, or dietary screening or other protection against Proposed § 111.25(a)(2) would require supplements are examined, processed, pests, where necessary. This provision that you use equipment and utensils of or held and in all areas where contact would be one measure to exclude appropriate design and construction surfaces are cleaned. Proposed certain pests from the physical plant whose use will not result in the § 111.20(e) also would require that you that also may assist you in complying contamination of your components, provide adequate lighting in hand with proposed § 111.15(c). As we dietary ingredients, or dietary washing areas, dressing and locker explained earlier in the discussion of supplements with lubricants, fuel, rooms, and bathrooms. Inadequate proposed § 111.15(c), pests are a coolants, metal or glass fragments, filth lighting in areas where components, potential source of contamination or other extraneous material, dietary ingredients, or dietary because they may carry microorganisms, contaminated water, or any other supplements are examined, processed, shed hair or feathers, leave droppings, contaminants. or held may make it difficult to examine or carry filth or dirt into your physical Proposed § 111.25(a)(3) would require a component or read a label; as a result, plant. your equipment and utensils to be: incorrect ingredients may be used in a • Installed and maintained to dietary supplement. Adequate lighting D. Equipment and Utensils (Proposed facilitate cleaning the equipment, also is important in areas where contact Subpart D) utensils, and all adjacent spaces; surfaces are cleaned to ensure that the Proposed subpart D consists of two • Corrosion-resistant if the equipment contact surfaces have been cleaned provisions. These proposed provisions or utensils contact components, dietary properly. Adequate lighting is important consist of general requirements for ingredients, or dietary supplements; in hand-washing areas, dressing and equipment and utensils and for • Made of nontoxic materials; locker rooms to ensure that personal automatic equipment, including • Designed and constructed to cleanliness is maintained in accordance computerized systems, hardware, and withstand the environment of their with proposed § 111.10(b). software. intended use, the action of components, Proposed § 111.20(f) would require dietary ingredients, or dietary your physical plant to use safety-type 1. What Requirements Apply to the supplements, and, if applicable, light bulbs, fixtures, skylights, or other Equipment and Utensils You Use? cleaning compounds and sanitizing glass that is suspended over exposed (Proposed § 111.25) agents; and components, dietary ingredients, or Proposed § 111.25 would establish • Maintained to protect components, dietary supplements in any step of general requirements pertaining to dietary ingredients, and dietary preparation, unless otherwise equipment design, construction, and supplements from being contaminated constructed in a manner that will sanitation. For example, proposed by any source. protect against contamination in case of § 111.25(a)(1) would require that you Deteriorating equipment can be a glass breakage. These precautions are use equipment and utensils of source of contamination. For example, necessary because glass shards can be appropriate design, construction, and repeated contact between metal surfaces very small and difficult to see, and some workmanship that would enable them to in a grinding or tableting machine can lights may spread their contents if they be suitable for their intended use, result in metal fragments that can burst or explode. So, to protect your adequately cleaned, and properly contaminate your dietary ingredients or components, dietary ingredients, and maintained. The equipment and utensils dietary supplements. So, your dietary supplements, the proposal covered under the proposal would equipment and utensils must be would require your physical plant to include, but not be limited to: designed and constructed to withstand take precautions concerning your • Equipment used to hold or convey; the environment of their intended use lighting and other suspended glass. • Equipment used to measure; and you must maintain your equipment

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and utensils to guard against 100.4 °F, and the variation in would imply strongly a need for contamination. temperature was not significant validation, but that validation is a Proposed § 111.25(a)(4) would require statistically, you could say the standard applicable to drug CGMPs, but your equipment and utensils to have thermometer is precise. The proposed not to food CGMPs. The comment said seams that are smoothly bonded or requirement identifies examples of such that a dietary supplement CGMP rule maintained to minimize accumulation instruments and controls, such as should not require validation of of component, dietary ingredient, or instruments or controls you use to instruments and controls. dietary supplement particles, dirt, filth, measure, regulate, or record: We disagree with the comment’s organic material, or any other • Temperatures; objection to requiring all instrument and extraneous material or contaminants. • pH; controls be accurate because, as we We are proposing this requirement • Water activity; or stated earlier, inaccurate instruments because equipment and utensils • Other conditions that control or and controls may generate inaccurate containing breaks, pits, cuts, or grooves prevent the growth of microorganisms readings, and those readings may can be difficult to clean, and the pores or other contamination. adulterate your dietary ingredients and or crevices in those breaks, pits, cuts, or Instruments or controls that affect the dietary supplements. We believe that all grooves can become a breeding ground environment, such as instruments that instruments and controls used in the for microorganisms and insulate them regulate temperature, pH, and water manufacture, packaging, and holding of from cleaning and sanitizing agents. activity, are important because dietary ingredients and dietary Proposed § 111.25(a)(5) would require environmental factors can influence supplements be accurate and precise, freezers and cold storage compartments microorganism growth and adequately maintained, and adequate in that hold components, dietary deterioration. For example, changes in number for their designated uses. ingredients, or dietary supplements to water activity (aw) can have a dramatic We further disagree that the be fitted with accurate thermometers or impact on microorganism growth. A principles of validation are applicable to other temperature-measuring or population of Salmonella typhimurium drugs, but not to foods. We stated in a temperature-recording devices and is reduced tenfold in 0.18 minutes at 60 previous FDA publication (Ref. 59) that ° would recommend automatic devices C if the aw for the suspending medium the ‘‘computerized system used to for regulating temperature or for is 0.995. If the aw is 0.94, it takes 4.3 control critical functions in food sounding an alarm to indicate minutes (or nearly 24 times as long) at processing should be validated in its significant temperature changes in a 60 °C to achieve the same tenfold entirety.’’ We have no basis to conclude manual operation. These devices are reduction (Ref. 58). that validation of instruments and necessary to ensure that you are able to Adequate maintenance is an controls is a standard applicable to monitor the temperatures where you important part of proposed drugs and not to foods, nor did the hold your components, dietary § 111.25(a)(6). If you fail to properly comment provide a reason for its ingredients, or dietary supplements and maintain your instruments and controls, assertion that validation does not apply to indicate whether they were held at they may produce unreliable readings to foods. We invite comment in this appropriate temperatures to minimize and contribute towards the proposal on whether we should include the growth of pathogens and to prevent contamination and adulteration of your requirements in a final rule, that would deterioration. dietary ingredients and dietary address the same or similar concerns While we patterned proposed supplements. For example, assume that that the principles of validation would § 111.25(a)(5) after a provision in the you refrigerate a particular dietary address. We also invite comment on food CGMPs (§ 110.40(e)), we invite ingredient to prevent microorganism whether there are other procedures that comment on whether we should require growth. If your refrigerator gives you the we should include in a final rule. specific target temperatures for dietary wrong temperature readings so that the Proposed § 111.25(a)(7) would require ingredients or dietary supplements held actual temperature inside your compressed air and other gases that are in freezers or cold storage, and if so, refrigerator is too high, you may be introduced into or onto a component, what those temperatures should be and unaware of microorganism growth that dietary ingredient, dietary supplement, why. has occurred on your dietary ingredient. or contact surface or that are used to Proposed § 111.25(a)(6) would require Similarly, if the actual temperature clean contact surfaces to be treated in a instruments or controls used in the inside your refrigerator is too low so way so that they do not contaminate the manufacturing, packaging, or holding of that you unintentionally froze the component, dietary ingredient, dietary a dietary ingredient or dietary dietary ingredient, the freezing process supplement or contact surface. Air or supplement to be accurate and precise, may have produced a chemical change other gases that are not properly treated adequately maintained, and adequate in in your dietary ingredient that will and filtered, or air that is not of the number for their designated uses. By cause it to be out of specification. proper purity, can introduce using the words, ‘‘accurate and precise,’’ Note, too, that the proposal also contaminants into the dietary we mean that the instruments or would require that your instruments supplement product and adulterate it. controls must be accurate—the recorded and controls be adequate in number for Also, compressed gases can be measurements are equal to the true their designated uses. For example, if contaminated with oil from the value of the thing being measured—and the temperature of a large piece of equipment (such as an air compressor) precise—individual measurements equipment needs to be monitored, or with filth or microbiological should be close to each other when several temperature-indicating devices contaminants from the compression, made under the same conditions. For may be needed to accurately monitor storage, or distribution equipment. So, if example, if the temperature inside a the temperature in all parts of the left untreated, the compressed air can particular piece of equipment is 100 °F, equipment. deposit those contaminants onto your and your thermometer for that piece of A comment to the ANPRM objected to components, dietary ingredients, dietary equipment reads a temperature of 100 requiring all instruments and controls supplements, and contact surfaces. °F, the thermometer is accurate. If used in all aspects of dietary Filtration at the air intake and after multiple temperature readings for that supplement manufacturing be accurate. compression, storage, and distribution thermometer ranged from 99.7 °F to The comment said such a requirement may be an effective means of reducing

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the risk that such contaminants will document that the written procedure also provide information on when and enter the compressed air or other gases. was followed each time a calibration how the instruments and controls were Proposed § 111.25(b)(1) would require was performed or that you must calibrated in case a problem arises with that you calibrate your instruments and document, at the time of performance, a batch of dietary ingredients or dietary controls that you use in manufacturing that the instrument and control supplements. If you examine these or testing components, dietary calibration established in accordance records over time, you also will be able ingredients, or dietary supplements. with this section was performed. The to see how precise your instruments and Proposed § 111.25(b)(2) would require proposed calibration requirement gives controls are and to make any necessary that you calibrate before you first use you discretion in deciding whether to adjustments or repairs. For example, if the instruments and controls and either establish and follow a written your records show that a scale gives a as specified in writing by the calibration procedure. If you establish a particular reading for a standard manufacturer of the instrument and written procedure for calibrating reference weight in January, but then control or at routine intervals or as instruments and controls, you must shows a different reading in June for the otherwise necessary to ensure their document, at the time of calibration same standard reference weight, you accuracy and precision. Calibrating performance, that the written procedure may need to adjust, repair, or even instruments and controls will ensure was performed. If you do not establish replace your scale. that they are accurate and precise and a written calibration procedure then you In fact, proposed § 111.25(d) would that the instrument or control readings must document, at the time of require that you repair or replace are ‘‘true values.’’ We invite comment performance, that the calibration instruments and controls that cannot be on whether we should require, in a final established accordance with this section adjusted to agree with the reference rule, that you establish and follow a was performed. You must identify the standard. You should not trust any written procedure for calibrating following for calibrating instruments instrument or control that cannot be instruments and controls, and whether and controls in any written procedure or adjusted to agree with a reference there are other procedures, that we at the time of performance: standard because an inaccurate should consider including in a final • The instrument or control measurement or reading may result in rule. If comments assert that written calibrated; an adulterated dietary ingredient or procedures are necessary, comments • The date of calibration; dietary supplement. Again, to use a should include an explanation of why • The reference standard used scale as an example, if you have a scale the requirement is necessary to prevent including the certification of accuracy of that you cannot adjust to read the adulteration including how such a the known reference standard and a correct weight, using that scale to weigh requirement would ensure the identity, history of recertification of accuracy. A a dietary ingredient to be added to a purity, quality, strength, and certification of accuracy usually particular mix would cause you to add composition of the dietary ingredient or accompanies a standard reference either too much or too little of the dietary supplement. Conversely, if material and often is valid for a specific dietary ingredient into your mix, thus comments assert that written procedures period of time, but the supplier of the throwing your mix out of specification. are not necessary, comments should reference standard may recertify the So, proposed § 111.25(d) would require include an explanation of why the standard’s accuracy. The recertification that you repair or replace that scale. requirement is not necessary including typically involves testing by the Proposed § 111.25(e) applies to how, in the absence of the requirement, supplier to verify that the material maintenance and sanitation. The word one can prevent adulteration and ensure maintains accuracy as a testing ‘‘maintenance,’’ in this provision, means the identity, purity, quality, strength reference. This information also may the act of keeping your equipment and and composition of the dietary help you trace the source of a problem, utensils in working order as ingredient or dietary supplement. if one arises, in your dietary ingredients recommended by their manufacturer. Further, we seek comment on whether or dietary supplements. For example, if Proposed § 111.25(e)(1) would require any of the proposed requirements in this consumers report an adverse event with that you maintain, clean, and sanitize, section are not necessary to prevent a batch of dietary supplements, records as necessary, all equipment, utensils, adulteration and to ensure the identity, containing a certification of accuracy of and any other contact surfaces that are purity, quality, strength, and the reference standards used and a used to manufacture, package, or hold composition of the dietary ingredient or history of their recertification would components, dietary ingredients, or dietary supplement. If comments assert help you determine if the problem dietary supplements and to take apart that certain provisions are not resulted from using an inaccurate your equipment and utensils as necessary, comments should include an reference standard to calibrate your necessary for thorough maintenance, explanation of why the requirement is instruments; cleaning, and sanitizing. Obviously, if not necessary including how, in the • The calibration method used you fail to keep your equipment, absence of the requirement, one can including appropriate limits for utensils, and contact surfaces clean, you prevent adulteration and ensure the accuracy and precision of instruments risk contaminating them with identity, purity, quality, strength, and and controls when calibrating; microorganisms and other contaminants composition of the dietary ingredient or • The calibration reading or readings and risk transferring those dietary supplement. If comments agree found; microorganisms or other contaminants that the proposed requirements are • The recalibration method used if to anything that touches the equipment, necessary for reasons other than those accuracy or precision or both accuracy utensils, and contact surfaces. we have provided, the comments should and precision limits for instruments and Proposed § 111.25(e)(2) would require so state and provide an explanation. controls were not met; and that you ensure that all contact surfaces Proposed § 111.25(c) would require • The initials of the person who used for manufacturing or holding low- that you must establish a written performed the calibration. moisture components, dietary procedure for calibrating instruments These records will enable you to ingredients, or dietary supplements are and controls you use in manufacturing determine whether the calibration in a dry and sanitary condition at the or testing a component, dietary schedule can maintain the accuracy of time of their use. If the surfaces are wet- ingredient, or dietary supplement and your instruments and controls, and will cleaned, you must sanitize them, when

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necessary, and allow them to dry a contact surface because persons opposed to the planned use, of the thoroughly before you use them again. reaching for those paper towels might equipment. If comments assert that Thoroughly drying equipment before drip contaminated water or other fluids written procedures are necessary, it is used for manufacturing or holding onto the contact surface. Inadvertent comments should include an dry dietary products is essential to reuse of a single-service article also explanation of why the requirement is ensure that the equipment will not could lead to contamination, so necessary to prevent adulteration change the composition of the dry disposing of single-service articles is an including how such a requirement product. For example, if moisture is left important element in proposed would ensure the identity, purity, on equipment, the moisture will become § 111.25(e)(5). quality, strength, and composition of the a part of the product and may change Proposed § 111.25(e)(6) would require dietary ingredient or dietary the composition of the product. Moist your cleaning compounds and supplement. Conversely, if comments surfaces can also promote sanitizing agents to be adequate for their assert that written procedures are not microorganism growth, and intended uses and safe under their necessary, comments should include an microorganisms can adulterate your conditions of use. An adequate cleaning explanation of why the requirement is components, dietary ingredients, or compound is one that will lower the not necessary including how, in the dietary supplements. surface tension of water so that spills absence of the requirement, one can Proposed § 111.25(e)(3) would apply can be lifted and flushed away (Ref. 60). prevent adulteration and ensure the if you use wet processing during Ordinary soap has a limited ability to identity, purity, quality, strength, and manufacturing. Under the proposal, you solubilize fats, oils, and proteins. composition of the dietary ingredient or would have to clean and sanitize all Inorganic alkaline detergents can dietary supplement. contact surfaces as necessary to protect dissolve food solids, such as fats and As discussed later, proposed against the introduction of proteins, but mineral deposits will § 111.50(c)(4) would require that you microorganisms into components, frequently require the use of acid document, in the batch production dietary ingredients, or dietary cleaners (Ref. 60). Proposed record, the date and time of the supplements. Proposed § 111.25(e)(3) § 111.25(e)(6) would not prescribe any maintenance, cleaning, and sanitizing of also would require that, when cleaning particular cleaning compound. Instead, the equipment and processing lines and sanitizing is necessary, you must you may select cleaning compounds used to producing the batch. Records clean and sanitize all contact surfaces that are suited to your particular needs. that document the batch or lot number before use and after any interruption An adequate sanitizing agent is one that of each batch or lot of dietary during which the contact surface may has a bactericidal effect on the types of ingredients or dietary supplements become contaminated. If you use microorganisms normally present in the processed using a particular piece of contact surfaces in a continuous physical plant environment and is safe, equipment or a particular utensil production operation or in back-to-back chemically stable, and convenient for between equipment startup and operations involving different batches of use. However, sanitizing agents can shutdown for maintenance, cleaning, the same dietary ingredient or dietary achieve their intended effect only after and sanitizing will allow you to identify supplement, the proposal would require they are applied to a surface that has all dietary ingredients or dietary that you clean and sanitize the contact been thoroughly cleaned, and if they are supplements that may have been surfaces as necessary. applied at a proper concentration (Ref. manufactured or packaged with a Proposed § 111.25(e)(4) would 61). specific piece of equipment or utensil if complement proposed § 111.25(e)(2) Proposed § 111.25(e)(7) would require you later discover that the equipment or and (e)(3) by requiring that you clean, as that you store cleaned and sanitized utensil was improperly maintained, frequently as necessary, surfaces that do portable equipment and utensils that cleaned, or sanitized. not touch components, dietary have a contact surface in locations and Proposed § 111.25(f) would require ingredients, or dietary supplements to in a manner that protect them from that you keep calibration records as protect against contamination. For contamination. This requirement is required by this section in accordance example, you would not have to clean necessary to ensure that your portable with the recordkeeping requirements in your ceilings as often as you clean your equipment remains clean and sanitized proposed § 111.125. Such records will contact surfaces because your ceilings until used; otherwise, if the contact verify for you and the agency that normally do not touch components, surfaces on the portable equipment or calibrations are performed. More dietary ingredients, or dietary utensils become contaminated, they importantly, these records will help you supplements. However, you would have could lead to adulteration of your ensure that all calibrations are to clean your ceilings as frequently as dietary ingredients or dietary performed. If problems do occur with necessary to prevent dust or other supplements. the production of a product, these contaminants from falling onto your We invite comment on whether we records will help you determine components, dietary ingredients, dietary should require, in a final rule, that you whether those problems are associated supplements, and contact surfaces. establish and follow a written procedure with faulty calibrations. These records Proposed § 111.25(e)(5) would for maintenance, cleaning, and will help you determine which batches establish requirements for single-service sanitizing. Further, we invite comment were produced under these conditions. articles, such as utensils intended for on whether we should require that the Further, these records will help you one-time use, paper cups, and paper person who performs the maintenance, train employees or adjust the calibration towels. Proposed § 111.25(e)(5) would cleaning, and sanitizing described in schedule as needed to avoid further require these articles to be stored in this section document, at the time of problems. appropriate containers and handled, performance that the maintenance, dispensed, used, and disposed of in a cleaning, and sanitizing were 2. What Requirements Apply to manner that protects against performed. Those procedures may be Automatic, Mechanical, or Electronic contamination of components, dietary helpful to inform you that equipment is Equipment? (Proposed § 111.30) ingredients, dietary supplements, or any being maintained, cleaned, and Manufacturers of dietary ingredients contact surface. For example, you would sanitized regularly and as frequently as and dietary supplements often rely on not place a paper towel dispenser over is necessary based on the actual use, as automatic, mechanical, and electronic

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equipment in production. Automated must function as intended. Some production errors or discrepancies and equipment is often used to ensure systems may work properly only within to make necessary corrections. Such proper formulation, mixing, and a narrow range of environmental records will allow you to troubleshoot processing or to test a batch of dietary conditions, such as temperature and and to operate these systems with a ingredient or dietary supplement. Such humidity, and some might be minimum of interruption when automated equipment frequently particularly sensitive to electromagnetic problems occur because the records will consists of a computer or system of interference. The actual conditions of include a copy of all software used and computers that control many or all use of a system should be considered as a backup file of data entered into the stages of production, inprocess early as possible in its design and computer or related system which can sampling, and testing. It is important development. Systems need to be be used to reload the system. The that such systems and equipment installed in a manner that takes into records also will provide information function as expected to ensure that the account the inherent limitations of the that you can use in trying to determine dietary ingredient or dietary supplement system, tested under conditions that why a problem with the system is contains the correct ingredients in the reflect actual conditions of use, and occurring or why the system is not appropriate amounts and is properly maintained to ensure that they producing a dietary ingredient or manufactured according to these CGMP continue to function as expected during dietary supplement that complies with proposed requirements, and thus, is not their lifetime. your specifications for the product. adulterated under section 402(g) of the Moreover, the incorporation of Appropriate controls that you act. software into the operation of automatic establish and use for automated Proposed § 111.30 sets forth equipment has not only increased the measuring, regulating, or recording requirements for automatic, mechanical, complexity of such equipment but also temperatures, pH, acidity, water or electronic equipment. These types of has resulted in a process that may activity, or other conditions will equipment include, for example, operate differently for each execution minimize the potential for growth of mechanical equipment such as a scale because a software-based control system microorganisms, for contamination, or used to weigh bulk components and can be configured at will by the operator for adding too much or too little of a electronic equipment such as a or by the system itself. Therefore, dietary ingredient. Observations, computerized blending machine. proposed § 111.30(a) would require that inspections, and checks of the Proposed § 111.30(a) would allow you you exercise appropriate controls over equipment will help you to determine if to use automatic, mechanical or systems and, in particular, over the critical factors such as revolutions per electronic equipment to manufacture, software used in the systems. minute, temperatures, pressures, package, label, and hold a dietary Proposed § 111.30(b) would require, process times, and automatic ingredient or dietary supplement. Thus, for any automatic, mechanical, or documentation are being controlled by the proposal would let you decide what electronic equipment that you use, that the system. Under proposed § 111.30(b), type of equipment meets your needs. you must: examples of controls to ensure that the Proposed § 111.30(a)(1) would require • Routinely calibrate, inspect, or equipment functions in accordance with that you must design or select check to ensure proper performance. its intended use include: equipment to ensure that dietary • Make and keep written records of • Determining the extent and ingredient or dietary supplement equipment calibrations, inspections, or frequency of calibration, inspections specifications are consistently achieved. checks; and checks to ensure proper • Equipment used in dietary ingredient or Establish and use appropriate performance; dietary supplement manufacturing, controls to ensure that your quality • Determining and using packaging, and label operations must be, control unit approves changes in master predetermined action plans when an for example, of an appropriate size and manufacturing record, batch control alarm sounds indicating an out-of-limits installed properly in order to produce records, packaging operations and label situation or malfunction; an unadulterated product. If not operations, or changes related to the • Checking in-put and out-put on a designed or installed properly, the equipment that you use and that only sufficient basis to provide a high degree equipment can lead to a variety of authorized personnel institute the of assurance that input and output is problems. For example, a mixer for the changes; accurate; blending of powdered ingredients will • Establish and use appropriate • Comparing manual calculations of not properly perform its function if the controls to ensure that the equipment data with the automated calculations on blade is too small relative to the size of functions in accordance with its a sufficient basis to provide a high the mixer or not properly placed inside intended use and have your quality degree of assurance that the automated of the mixer. Such a mixer may produce control unit approve these controls; and calculations are accurate; and an adulterated product because the • Make and keep backup file(s) of • Determining the adequacy of dietary supplement, for example, is not software programs and of data entered automated cleaning and residue of uniform composition and therefore into your computer system. Your elimination. would not be able to meet the backup file may be a hard copy of data We invite comment on whether we specifications for purity, quality, you have entered, diskettes, tapes, should require, in a final rule, that you strength, or composition in the final microfilm, or compact disks but must be establish and follow written procedures product. Thus, equipment design and an exact and complete record of the data for the calibration, inspection, and selection is critical to ensure that you you entered. We also propose to require checking of automatic equipment. In manufacture an unadulterated dietary that you keep your backup software addition, we invite comment on ingredient or dietary supplement. programs and data secure from whether there are procedures, other Proposed § 111.30(a)(2) would require alterations, inadvertent erasures, or loss. than those mentioned, that we should that you determine the suitability of In this way, you have a record of include in a final rule. If comments your equipment. The equipment that changes to your software program and of assert that written procedures are you use must be capable of operating your current software program used in necessary, comments should include an satisfactorily within the operating limits manufacturing. This information is explanation of why the requirement is required by the process. The equipment important to both identify any necessary to prevent adulteration

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including how such a requirement you whether your automatic, E. Production and Process Controls would ensure the identity, purity, mechanical, or electronic processes will (Proposed Subpart E) quality, strength, and composition of the consistently operate as they should. Proposed subpart E contains dietary ingredient or dietary We believe, in general, that scientific production and process controls to help supplement. Conversely, if comments knowledge and industry experience ensure that you have controls covering assert that written procedures are not have defined the basic elements of a all manufacturing, packaging, label, and necessary, comments should include an sound verification system to include; holding operations, and that those explanation of why the requirement is determining whether the capacity of the controls will prevent adulteration of not necessary including how, in the hardware matches its assigned function; your dietary ingredient or dietary absence of the requirement, one can identifying and considering operational supplement. We propose to establish a prevent adulteration and ensure the limits in establishing production framework in which decisions about identity, purity, quality, strength, and procedures; determining whether the producing a dietary ingredient or composition of the dietary ingredient or software matches the assigned dietary supplement are left to you, but dietary supplement. Further, we seek operational function; testing simulated that charges you with incorporating into comment on whether any of the production conditions including ‘‘worst your production process, measures that proposed requirements in this section case’’ conditions; repeating tests enough are designed to ensure that the dietary are not necessary to prevent times to assure a reasonable measure of ingredient or dietary supplement is adulteration and to ensure the identity, consistent reproducible results; manufactured in a manner that will purity, quality, strength, and documenting the verification program; composition of the dietary ingredient or prevent adulteration and misbranding. and initiating reverification when Dietary ingredient and dietary dietary supplement. If comments assert significant changes are made to the supplement manufacturing requires that certain provisions are not system or when errors are noted. necessary, comments should include an technical knowledge and skill (e.g., in Although verification steps would research and development, production explanation of why the requirement is vary according to the nature of the not necessary including how, in the equipment and procedures, and dietary supplement and the complexity analytical equipment and methodology) absence of the requirement, one can of the process, the basic elements of a prevent adulteration and ensure the that a vast majority of companies in the verification system would be generally food processing industry do not have. A identity, purity, quality, strength, and applicable to all dietary ingredients and composition of the dietary ingredient or dietary ingredient or dietary supplement dietary supplements. The primary manufacturer must maintain constant dietary supplement. If comments agree benefit of a verification system would be that the proposed requirements are control because a seemingly innocuous to provide a foundation for building a change in the formulation or necessary for reasons other than those comprehensive approach to ensure that we have provided, the comments should preparation method or in exposure to an the equipment performs in a so state and provide an explanation. unanticipated environmental condition predetermined way, but verification For computerized equipment, you could create a health hazard. Earlier, in should note that we already have issued could impose additional costs on section I.E of this document in our guidance documents that may give you manufacturers. discussion of ‘‘FDA’s Decision to some helpful information. The guidance We invite comment on whether Propose a Rule,’’ we cite several documents are: ‘‘FDA Guide to automatic, mechanical, and electronic examples of problems arising from Inspections of Computerized Systems in equipment verification and poorly controlled manufacturing the Food Processing Industry’’ (Ref. 59), reverification elements that we have practices. For example, we cite and a ‘‘Guide to Inspections of discussed should be done, should be problems of dietary ingredient Computerized Systems in Drug included in the final rule as misidentification; super- and subpotent Processing’’ (Ref. 62). Although we did requirements, which would include dietary supplements; and contamination not draft these guidance documents for requirements to document the including toxic substances, dietary ingredient and dietary verification steps. We invite comment microorganisms of public health supplement firms, they still provide on whether we should regulate significance, and heavy metals. Thus, important advice on establishing and computerized systems separately from we believe that using a production and using computerized systems in dietary other automatic equipment. We seek inprocess control system covering all supplement manufacturing operations. comment on whether any of the stages of processing is necessary to Given the broad range in sophistication, proposed requirements in this section insure that the dietary ingredient or complexity, and computerization in are not necessary to prevent dietary supplement is manufactured in manufacturing equipment, we invite adulteration and to ensure the identity, a manner that will prevent adulteration. comments on whether we should purity, quality, strength, and composition of the dietary ingredient or 1. What Production and Process regulate computerized systems Controls Must You Use? (Proposed separately from other automatic dietary supplement. If comments assert § 111.35) equipment. that certain provisions are not Although we are not proposing necessary, comments should include an Proposed § 111.35(a) would require verification requirements in this explanation of why the requirement is that you implement a system of proposed rule, we are seeking comment not necessary including how, in the production and inprocess controls that on whether such verification should be absence of the requirement, one can covers all stages of manufacturing, included in a final rule. Verification prevent adulteration and ensure the packaging, labeling, and holding of the would be intended to ensure that the identity, purity, quality, strength, and dietary ingredients and dietary processes using automatic, mechanical, composition of the dietary ingredient or supplements. and electronic equipment consistently dietary supplement. If comments agree Proposed § 111.35(b) would require produce an outcome that meets a that the proposed requirements are that your production and inprocess predetermined specification and any necessary for reasons other than those control system must be designed to predetermined quality characteristics. we have provided, the comments should ensure that you manufacture, package, Verification would be intended to show so state and provide an explanation. or hold dietary ingredients or dietary

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supplements in a manner that will section 402(a)(1) of the act. Thus, act) in a dietary ingredient or a dietary prevent their adulteration. The proposal manufacturers have a responsibility to supplement would include the amounts would require that your production and ensure that the dietary ingredients and of the substance that likely would be inprocess control system must include dietary supplements that they produce ingested, based on the amounts all requirements of this subpart and also are not adulterated under section 402(f) recommended or suggested in the label, would require your quality control unit of the act. or under ordinary conditions of use. to review and approve the production However, certain substances are not Such a use may present concerns about and inprocess control system. We ‘‘dietary ingredients’’ within the the safety of exposure to such believe that requiring a production and meaning of section 201(ff) of the act, ingredient, based on the chronic use inprocess control system is necessary to and thus, are not exempt under section suggested or reasonably expected. provide consistency in producing 201(s) from regulation as a food additive Therefore, it is incumbent on the different batches of dietary ingredients under section 409 of the act. Such manufacturer to use ‘‘non-dietary or dietary supplements and to facilitate substances include components that are ingredients,’’ that are safe and lawful preparing each batch. added to provide certain technical under applicable sections of the act for Proposed § 111.35(c) would require effects to the dietary supplement, such such use. that you use your quality control unit in as disintegration, lubrication, or As stated previously, ingredients used your manufacturing, packaging, and binding. In addition, such substances in dietary ingredients or dietary label operations to ensure that these may include color additives that are supplements, other than color additives, operations are performed in a manner used or intended for use to impart color are required to be approved for use as that prevents adulteration and to ensure to the dietary ingredient or dietary a food additive unless excepted from the that the dietary ingredient or dietary supplement. Color additives are exempt definition of a food additive under supplement meets specifications for from the definition of ‘‘food additive’’ section 201(s) of the act. For example, identity, purity, quality, strength, and under section 201(s)(3) of the act and we approved the use of sucralose as a composition. subject to approval and listing under general purpose sweetener in food, Proposed § 111.35(d) establishes section 721 of the act. which would include its use in a dietary requirements for any substance that may Proposed § 111.35(d) would require ingredient or dietary supplement (64 FR be used in a dietary ingredient or a that any substance, other than a ‘‘dietary 43908, August 12, 1999). Some other dietary supplement. This section would ingredient,’’ the intended use of which current food additive listings that would require that any substance that is used results or may reasonably be expected to include uses in certain types of dietary be a ‘‘dietary ingredient’’ within the result, directly or indirectly, in its supplements include, ethyl cellulose (21 meaning of that term in section 201(ff) becoming a component or otherwise CFR 172.868) as a component of of the act, or, if not included with the affecting the characteristics of the protective coatings for vitamin and meaning of that term, must meet the dietary ingredient or dietary mineral tablets, and hydroxypropyl applicable statutory and regulatory supplement, must be: cellulose (21 CFR 172.870) as a binder requirements under section 409 of the • Authorized for use as a food and disintegrator in dietary supplement act, or section 721 of the act (21 U.S.C. additive under section 409 of the act, or vitamin or mineral tablets or wafers. If 379e) if a color additive, to ensure that • Authorized by a prior sanction you have questions about the regulatory the substance is safe and lawful for use consistent with 21 CFR 170.3(l), or status of any substances that you want in a dietary ingredient or a dietary • If used as a color additive, subject to use in a dietary ingredient or a supplement. to a listing that, by the terms of that dietary supplement, you are encouraged A ‘‘dietary ingredient’’ within the listing, includes the use in a dietary to contact CFSAN’s Office of Food meaning of section 201(ff) of the act that supplement, or Additive Safety. is in, or intended for use in, a dietary • Generally recognized as safe We recognize that some ingredients supplement is exempt from the (GRAS) for use in a dietary ingredient or may not be subject to section 409 of the definition of ‘‘food additive’’ in section dietary supplement. Any claim that a act, food additive approval, because 201(s). Such ‘‘dietary ingredients’’ are substance is GRAS, other than a dietary they are GRAS substances. For those not subject to the premarket approval ingredient within the meaning of substances that are GRAS, proposed standard for food additives under section 201(ff) of the act, must be § 111.35(d)(4) would require the section 409 of the act. However, under supported by a citation to the agency’s manufacturer to have documentation for section 402(f)(1) of the act, in order for regulations or by an explanation for why the basis for why such a substance, that a dietary ingredient or a dietary there is general recognition of safety of is not a ‘‘dietary ingredient’’ within the supplement not to be deemed the use of the substance in a dietary meaning of section 201(ff) of the act, is adulterated, substances that are ‘‘dietary ingredient or dietary supplement, and approved for use or is GRAS for use in ingredients’’ that are used in the • Must comply with all other a dietary ingredient or dietary manufacture of a dietary ingredient or a applicable statutory and regulatory supplement. dietary supplement must not present a requirements under the act. The statute, under section 402(g)(2) of significant or unreasonable risk of Thus, if a color additive is used in a the act, provides that the Secretary may illness or injury under the conditions of dietary ingredient or dietary by regulation prescribe good use recommended or suggested in supplement, it must be listed in Title 21 manufacturing practices for dietary labeling or, if no such labeling, under of the Code of Federal Regulations (CFR) supplements. If the good manufacturing ordinary conditions of use. In addition, for use in food and the listing must, by practices are not met, the dietary there must be adequate information to its terms, include such use in a dietary ingredient or dietary supplement would provide reasonable assurance that a new supplement. If the substance is not a be adulterated under section 402(g) of dietary ingredient does not present a color additive, it must be safe under the act. Under proposed § 111.35(d), significant or unreasonable risk of other relevant sections of the act. substances that are not ‘‘dietary illness or injury. Further, under section Relevant considerations about the safety ingredients’’ that are used in dietary 402(f)(1) of the act, dietary ingredients of a substance that may be used as an ingredients and dietary supplements must not be poisonous or deleterious ingredient (other than a ‘‘dietary must be safe and lawful to comply with substances within the meaning of ingredient’’ under section 201(ff) of the CGMPs for such products. Thus, these

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nondietary ingredient substances must use an ingredient based solely on food submitted for review by us in a food be subject to a food additive listing, use of the substance prior to January 1, additive petition. authorized by a prior sanction, included 1958, you would need to support a Proposed § 111.35(e) would require with the terms of a color additive claim that the ingredient is GRAS with that you establish a specification for any listing, or listed as GRAS for such use an explanation of the basis for why the point, step, or stage in the in 21 CFR part 182 or affirmed as GRAS ingredient was in common use in a manufacturing process where control is for such use in 21 CFR part 184. dietary ingredient or a dietary necessary to prevent adulteration. These Alternatively, you can meet the supplement prior to January 1, 1958, points, steps, or stages may include requirements of § 111.35(d) by a and why that use provides the basis for heating steps, cooling steps, points showing that the substance is GRAS general recognition of the safety of the where specific sanitation procedures are within the meaning of § 170.30 (21 CFR substance. needed, product formulation control 170.30). We will view any ingredient, that steps, points where cross contamination Proposed § 111.35(d)(4) would require cannot meet the standard of § 170.30 for may occur, and steps where employee that you have information in your files a GRAS determination, as a food and environmental hygiene are that would substantiate the GRAS status additive, and any dietary ingredient or necessary to prevent adulteration of the of any nondietary ingredient substance dietary supplement that contains a food dietary ingredient or dietary that is not otherwise the subject of a additive that we have not approved for supplement. These specifications are food additive approval, prior sanction, use in the dietary ingredient or dietary regulatory specifications and you would or color additive listing. We believe supplement is subject to regulatory be required to perform testing or that, to implement the act in a way to action. If the safety of such ingredient is examination to confirm such regulatory ensure that the statutory goals are not recognized expressly in an FDA specifications are met. We discuss achieved; that is, to ensure that the regulation, you have the burden to performing testing or examination to manufacturer has the relevant explain why the ingredient is GRAS confirm that a regulatory specification is information to ensure that any asserted under § 170.30. met later in this document. A deviation GRAS ingredient is, in fact, GRAS, it is from such specification would signify In the Federal Register of April 17, appropriate to require that you that the dietary ingredient or dietary 1997, we issued a proposed rule on maintain, in your files, the basis for why supplement could be adulterated. Such GRAS notification (62 FR 18938). We the nondietary substance you assert is deviation would require investigation are currently accepting GRAS GRAS that you use in a dietary and a disposition decision approved by ingredient or dietary supplement is, in notifications under this proposed rule. the quality control unit under proposed fact, GRAS. You must not use unsafe However, we recognized in the GRAS § 111.35(i) (which we also discuss later ingredients in your products. Therefore, notification proposal (62 FR 18938 at in this document). you must have information on 18951) that a failure by us to object to The proposed rule would not prevent ingredients that you intend to use in a a GRAS notification is not equivalent to you from establishing additional dietary ingredient or dietary supplement a GRAS affirmation of GRAS status and specifications that are not at points, to demonstrate that such ingredient is we, as a matter of discretion, may not steps, or stages where control is safe. Otherwise, as a responsible advise a notifier of a problem that we necessary to prevent adulteration if manufacturer, you would not use the have identified that raises no important those additional specifications will help ingredient in your product. public health issues. Therefore, if you you meet your quality control demands, Therefore, under proposed submit a GRAS notification to us under but a failure to meet those nonregulatory § 111.35(d)(4), for any claim that a the April 17, 1997, proposed rule, our specifications will not require that you nondietary ingredient in a dietary failure to object to your determination make a material review and disposition supplement is GRAS, you must support that an ingredient is GRAS in a dietary decision. In other words, you may such claim with a cite to a FDA ingredient or dietary supplement will establish additional specifications regulation or an explanation for why not constitute a GRAS affirmation by us. beyond those that the proposed rule there is general recognition of the safety Further, if we know of no reason to would require, and a material review of the use of the substance in a dietary question the safety and lawfulness of and disposition decision would be ingredient or dietary supplement. If the ingredient that is the subject of a needed only for those specifications if such claim is based on general GRAS notification and that is used in not met, that are required under the recognition of safety based on scientific the manufacture of a dietary ingredient proposed rule. For example, if you procedures, the explanation would be or dietary supplement, we would not determine that a specific heat based on evidence that demonstrates object to your reliance on your temperature is needed at a point, step, that there is common knowledge about determination that the use of the or stage in the manufacturing process to the safety of the substance throughout substance is GRAS. You could not use prevent adulteration, that heat the scientific community knowledgeable our response to your GRAS notification temperature specification is a general about the safety of such substance. as your basis for asserting compliance regulatory specification. If not met, you Under § 170.30(c)(1), if a substance is with the requirements under proposed would need to make a material review GRAS based on common use in food § 111.35(d) because an FDA response and disposition decision. prior to January 1, 1958, this letter to a GRAS notification is not the In addition, proposed § 111.35(e) determination must be based solely on same as your explanation, e.g., a identifies certain points, steps, or stages food use of the substance before January response letter does not provide an where a regulatory specification is 1, 1958, and ordinarily must be based explanation for why an ingredient is required. Regulatory specifications are upon generally available data and GRAS. We encourage any dietary required for materials that you receive, information. Thus, GRAS based on ingredient or dietary supplement at the inprocess stage, and that you common use in food prior to January 1, manufacturer to consult with us on any manufacture, e.g., at the finished 1958, may be determined without the ‘‘nondietary ingredient’’ substance that product stage. Specifically, we are quantity or quality of scientific it intends to use in such product to proposing to require that you establish procedures required for approval of a ascertain whether the use of such specifications at these control points for food additive regulation. If you wish to ingredient may be more appropriately the identity, purity, quality, strength,

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and composition of the components must be safe and suitable for its stages in the manufacturing process (upon receipt only) and for dietary intended use and comply with all other where you determined that a ingredients or dietary supplements (at applicable statutory and regulatory specification is needed to ensure that all of these control points). requirements under the act and must the specification, in fact, is met. For You may establish additional not be reactive or absorptive so as to certain specifications that we would specifications (i.e., those in addition to affect the safety of the dietary ingredient require, i.e., the identity, purity, quality, identity, purity, quality, strength, and and dietary supplement. strength, and composition upon receipt, composition) at these same control Proposed § 111.35(f) would require inprocess, and at the finished product points. For example, you may determine that, for each point, step, or stage, for batch stage, we are providing some that an inprocess specification is which a specification is established flexibility for testing. To illustrate, necessary during the manufacturing under proposed § 111.35(e), you must testing or examination requirements for process to prevent adulteration. That monitor the production and inprocess specifications that you establish (e.g., inprocess specification would be a control points, steps, or stages to ensure those other than the identity, purity, regulatory specification. Specifications that they meet specifications and to quality, strength, and composition of the also are needed for the inprocess detect any unanticipated occurrence dietary ingredients or dietary materials to ensure that inprocess that may result in adulteration. Regular supplements received; inprocess, or materials are not adulterated by the monitoring of these points is necessary finished product), such as for a manufacturing process and are in to ensure that the product meets the botanical extraction process that uses a compliance with the master specifications under proposed specific heat temperature for spray manufacturing record. Additional § 111.35(e) and to ensure that any trend drying, you would be required to ensure specifications also may be needed for toward loss of control is quickly by testing or examination that the the finished product stage. identified. Quick identification of any specified temperature was used. You Specifications are needed for dietary trends that may lead to a deviation from would be required to perform such a test ingredients and dietary supplements a specification could mean that or examination at the inprocess point, you manufacture to ensure that the adjustments may be made to prevent a step, or stages where control is manufacturing process produces the deviation from occurring. In the event necessary. As another example, if a correct dietary ingredient or dietary that a deviation or unexpected specific temperature is used on a supplement and that adulterated and occurrence (such as leakage from a pipe finished batch of dietary ingredient or misbranded dietary supplements do not onto a component) occurs, effective dietary supplement as a heat treatment reach the marketplace. corrective actions can be taken to to inactivate or remove objectionable Containers and closures are a form of remove the adulterated product from the microorganisms that pose a health packaging. The containers and closure system. hazard, and thus, the heat treatment Under proposed § 111.35(g) you must or other packaging, such as blister pack, temperature is a critical control point ensure through testing or examination that comes in contact with dietary specification, then you must perform that each specification that you ingredients or dietary supplements must testing or examination to determine that establish under § 111.35(e) is met. not be reactive or absorptive so as to the specific temperature was used. You Under § 111.35(e), you would have to affect the safety of the dietary ingredient would be required to perform such a test determine the points, steps, or stages or dietary supplement and must be on each finished batch of dietary where control is necessary to prevent composed of substances that are ingredient or dietary supplement that is adulteration. However, there are certain authorized by the agency for use as a manufactured. food additive, the subject of a valid points, steps, or stages in proposed notification under section 409 of the act, § 111.35(e) that we tentatively have For those specifications that we authorized by a prior sanction issued by determined to be those where control is tentatively have determined are the agency, or GRAS for such use. necessary to prevent adulteration. necessary (identity, purity, quality, Thus, under this proposed Specifically, we tentatively have strength, and composition) at receipt, requirement, you would be required to determined that such control points inprocess, and finished product stage, establish specifications for any point, include the receipt of components, we are proposing specific testing step, or stage in the manufacturing dietary ingredients, or dietary requirements that provide some process where control is necessary to supplements, the inprocess stage of flexibility. Under § 111.35(g)(1), we prevent adulteration. Specific manufacturing, and the finished product would require that you test each specifications that would be required for batch stage. Further, we tentatively have finished batch of the dietary ingredient you to establish include: determined that at each of those control or dietary supplement produced before • The identity, purity, quality, points, there need to be specifications releasing for distribution to confirm that strength, and composition of for the identity, purity, quality, strength, specifications are met for the identity, components, dietary ingredients, or and composition of components (only at purity, quality, strength, and dietary supplements that you receive; receipt stage for components), dietary composition intended, provided that • The inprocess controls in the ingredients and dietary supplements (at there are scientifically valid analytical master manufacturing record where all of these control points). In addition, methods available to perform such control is necessary to ensure the we tentatively have determined that testing. We recognize that certain tests identity, purity, quality, strength, and specifications are necessary for dietary for identity, purity, quality, strength, or composition of dietary ingredients or ingredient and dietary supplement composition for certain finished product dietary supplements; labels and packaging. may not be available due to complex • The identity, purity, quality, The testing and examination finished matrices that would make such strength, and composition of the dietary requirements in proposed § 111.35(g) testing impracticable. Further, even ingredient or dietary supplement that would require that you conduct a test or though there may not be a scientifically you manufacture; and examination to ensure that valid analytical method that you could • The packaging that may come in specifications that you established are use to provide you with the information contact with dietary ingredients and met; i.e., that you conduct a test or to evaluate, for example, the identity dietary supplements. The packaging examination at those points, steps, or and composition of the finished

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product, there may be methods available recommend, but would not require, that test is one that is a scientifically valid for testing at the finished product stage you also test materials received for these analytical method. If there is an AOAC for other required specifications of same specifications to ensure that they or FDA method available that is purity, quality, and strength. Under are the right ingredients and so that you appropriate for your purpose, you proposed § 111.35(g)(3), your quality do not end up having to destroy an should use that test method. For control must document that a entire batch of finished product after example, if your dietary supplement scientifically valid analytical method is using an erroneous ingredient that could claims to contain vitamin C, there is a not available to perform finished have otherwise been identified earlier specific test for identifying vitamin C, product testing for any one of the before being added to a batch. and so proposed § 111.35(h) would required specifications for identity, For example, if you manufacture a require that you use that test (Ref. 68). purity, quality, strength or composition. batch of dietary supplements that If an AOAC or FDA method is not If your quality control unit documents contains only one single dietary available, a scientifically valid that a scientifically valid analytical ingredient, St. John’s Wort extract analytical method is one that is based method for testing each batch of dietary (Hypericum perforatum), and there are on scientific data or results published ingredient or dietary supplement is not scientifically valid analytical methods in, for example, scientific journals, available for any one of those required available to test the finished dietary references, text books, or proprietary specifications, then you would be ingredient or supplement to confirm research. While there may not be an required, under § 111.35(g)(2)(i) and that the specifications are met for the AOAC or FDA method available, we are (g)(2)(ii) to test incoming shipment lots identity, purity, quality, strength, and not aware of a situation where an of components, dietary ingredients, or composition intended, then you must appropriate scientifically valid dietary supplements for any such test each batch using such methods. In analytical method is not available. You specification to determine whether it is this example, you would not be required could perform the tests yourself or have met and to test inprocess for any such to perform testing of incoming shipment someone perform these tests for you. specification in accordance with the lots of St. John’s Wort to confirm Proposed § 111.35(i) would require master manufacturing record where identity, purity, quality, strength, and that you must: control is necessary to ensure the composition to confirm that • Establish corrective action plans for identity, purity, quality, strength, and specifications are met nor would you be use when an established specification is composition of dietary ingredients or required to perform testing of inprocess not met. We believe that this dietary supplements. for these same specifications in requirement is necessary because you Using a supplier certification, accordance with the master may need to take corrective action guarantee, or certification in lieu of manufacturing record. As discussed quickly, and the best way to ensure that performing testing on each shipment lot later under proposed § 111.40(b)(2), a corrective action is appropriate is to of components, dietary ingredients, or although testing would not be needed at determine the action in advance. For dietary supplements required in receipt stage for identity, purity, quality, example, if, during the production of a accordance with this section is not strength, and composition, you would specific batch, the temperature specified appropriate because it is possible that a be required under that section, to for tablet coating drying is not met, you supplier’s certification or guarantee may visually compare the label, supplier’s would be able to consult the corrective not ensure the identity, purity, quality, invoice, guarantee, or certification with action plan to see whom you should strength, or composition of a your purchase order for consistency. In contact, what correction to make, and component, dietary ingredient or dietary another example, if you manufacture a when to make the correction. Having supplement. For example, a supplier of dietary supplement that contains corrective action plans in place before a the dietary ingredient plantain provided multiple dietary ingredients (e.g., problem occurs can help you deal with a ‘‘certificate of analysis’’ indicating that Ginkgo Biloba, vitamin C, and folic those problems quickly and efficiently. the plant material was plantain powder, acid) and you do not perform testing on As another example, if during with a description of certain of its the finished dietary supplement because production an operator notes that too physical characteristics (Ref. 6). The there are not scientifically valid low a temperature is used during a plantain was contaminated with D. analytical methods available to confirm tablet coating drying operation, it would lanata (a plant that contains powerful that the specifications for identity, be best for the operator to have an action heart stimulants that can cause life- purity, quality, strength, and plan for immediate implementation, threatening reactions including cardiac composition are met for each dietary rather than having to stop the drying arrest, if ingested) and was distributed ingredient in the finished batch mixture, process to wait for instructions on what to at least 150 manufacturers, then you would be required to perform to do. Quick action may reduce the distributors, and retailers. Thus, if you testing of incoming shipment lots of possibility of diminished changes in do not perform finished product testing each dietary ingredient to confirm that tablet dissolution or an adulterated under § 111.35(g)(1) for identity, purity, such specifications are met and perform product and enable you to avoid having quality, strength, or composition, then inprocess testing in accordance with the to destroy incorrect tablets that are too you would need to test for that master manufacturing record to ensure moist or clump together or to avoid nontested finished product specification that such specifications are met. Thus, recalling a product because it settled upon receipt and inprocess as specified the proposed testing requirements into a clump or became moldy in the in the master manufacturing record to provide flexibility for testing for container; ensure that adulterated dietary identity, purity, quality, strength, and • Review the results of the ingredients or dietary supplements are composition, based on the availability of monitoring required by this section and not distributed to the marketplace. scientifically valid testing methods to conduct a material review of any If you are able to perform testing on perform testing on each batch of dietary component, dietary ingredient, dietary each finished batch of dietary ingredient ingredients or dietary supplements. supplement, packaging or label for or dietary supplement to confirm that Proposed § 111.35(h) would require which you establish a specification that specifications are met for the identity, that you use an appropriate test or is not met, or any unanticipated purity, quality, strength, and examination to determine whether your occurrence that adulterates or could composition intended, then we would specifications are met. An appropriate result in adulteration of the component,

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dietary ingredient, dietary supplement, approves such reprocessing. However, contamination that may adulterate or packaging, or label. This review will the proposal states that you must not may lead to adulteration. reveal whether the monitoring is reprocess any component, dietary The proposal also would require that actually being done and being done ingredient or dietary supplement if it is you use an appropriate scientifically correctly, and whether the rejected because of contamination with valid methodology for the test or specifications are being met; and microorganisms or other contaminants, examination. We discuss analytical • Make a material disposition such as heavy metals. We propose to methods in more detail elsewhere in decision for any component, dietary prohibit reprocessing in such cases this document in our discussion of ingredient, dietary supplement, because it is unlikely that reprocessing laboratory operations, proposed packaging, or label if: will eliminate such forms of § 111.60. The types of contamination 1. A component, dietary ingredient, contamination or will eliminate such covered by proposed § 111.35(k) dietary supplement, packaging, or label contamination without adversely include, but are not limited to, the fails to meet specifications; affecting the component, dietary following: 2. Any step established in the master ingredient, or dietary supplement. • Filth, insects, or other extraneous manufacturing record is not completed; Proposed § 111.35(i)(5) would require material; 3. There is any unanticipated that this review be conducted by an • Microorganisms; and occurrence during the manufacturing individual from the quality control unit. • Toxic substances. operations that adulterates or may lead This is necessary to ensure that the Under this proposed requirement, you to adulteration of the component, review is conducted by a person who is must test or examine for those types of dietary ingredient, dietary supplement, qualified by training and experience to contamination that may adulterate or packaging, or label; or conduct such reviews and who may lead to adulteration. The words, 4. Calibration of an instrument or understands the production and ‘‘for those types of contamination that control suggests a problem that may inprocess control system, understands may adulterate or may lead to have caused batches of a dietary the significance of a processing adulteration,’’ at least in part, mean that ingredient or dietary supplement to deviation, and knows how to respond to you must test a botanical for filth and become adulterated; and a deviation. This will ensure that the microorganisms of public health 5. A dietary ingredient or dietary review that is conducted and the significance. For example, it is highly supplement is returned. likely or certain that botanical • response to any deviation is Have your quality control unit appropriate. The requirements of this components would be contaminated approve any material review and section do not mean that the with filth and undesirable disposition decision. manufacturer needs a large number of microorganisms of public health You should review the public health employees. significance based on the areas in which significance of any deviations from Proposed § 111.35(j) would require they are harvested. Therefore, it would specifications or of any unexpected the person who conducts the material be inappropriate if you did not test occurrences to ensure that dietary review and makes the disposition botanical components for filth and ingredients and dietary supplements decision to document, at the time of microorganisms. The types of tests and that may have been affected adversely performance, every material review and when to test would be left to your by a deviation do not enter the disposition decision in proposed discretion. The proposed rule would not marketplace. A material review and § 111.35(i). The documentation must be specify any particular test or disposition decision would ensure that included in the batch production examination, so you would be able to the disruption of a manufacturer’s record. Proposed § 111.35(j) would decide on the appropriate methods for business is minimized when a deviation require this documentation to: testing or examination that are suited to does occur. For example, if review of a • Identify the specific deviation from your components, dietary ingredients, dietary supplement formulation does the specification or the unanticipated and dietary supplements. not contain the required identity, purity, occurrence; Contamination also can create quality, strength, or composition, you • Describe your investigation into the conditions that promote further can take steps to dispose of the cause of the deviation from the contamination by other organisms. For formulation before it is packaged and specification or the unanticipated example, contamination resulting from labeled. If the monitoring records are occurrence; possible fungal growth on a botanical not reviewed, a dietary supplement • Evaluate whether or not the component can provide the made with a deficient formulation may deviation from the specification or environment for mycotoxin production, be placed on the market, and a costly unanticipated occurrence has resulted especially aflatoxin (Refs. 63 and 64). and embarrassing recall may be in or could lead to adulteration; Therefore, if a toxic substance is a type necessary. • Identify the action(s) taken to of contamination that may adulterate or Proposed § 111.35(i)(4) would require correct and prevent a recurrence of the lead to adulteration of the dietary that for any deviation or unanticipated deviation or the unanticipated ingredient or dietary supplement, you occurrence which resulted in or could occurrence; and must perform an appropriate test to lead to adulteration of the component, • Discuss what you did with the detect the toxic substance. dietary ingredient, dietary supplement, component, dietary ingredient, dietary In other cases, a certain amount of packaging, or label, the proposal would supplement, packaging, or label. For micro flora on a botanical may be require that you reject the component, example, did you segregate the unavoidable. For example, some dietary ingredient, dietary supplement, component? Did you quarantine it until botanical components always will packaging, or label, unless the quality the quality control unit decided whether contain a certain number of control unit determines that inprocess it should be returned to its supplier, microorganisms that live on the plant or adjustments are possible to correct the reprocessed, or destroyed? come from other organisms (micro flora) deviation or occurrence. You would be Proposed § 111.35(k) would require on the plant. Processing these able to reprocess a rejected component, that you test or examine components, components may destroy a substantial dietary ingredient, or dietary dietary ingredients, and dietary number of the microorganisms, but supplement if the quality control unit supplements for those types of some may survive processing (Ref. 65).

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Therefore, for natural products it may be Proposed § 111.35(m) would require steps, such as production, engineering, appropriate to perform tests of finished that you must record the results of all research, and regulatory affairs, may be product to confirm that, of the testing and examinations performed in included in quality control functions. microorganisms present, those of public accordance with this section. If a test or Proposed § 111.37(b) would require health significance did not survive examination is performed on a that your quality control unit must do processing and those that remain that production batch, you must record the the following: are not of public health significance do test or examination result in the batch • Approve or reject all process, not contaminate the dietary ingredient production record in accordance with procedures, specifications, controls, or dietary supplement. § 111.50(c)(10). Your records must tests, and examinations, and deviations Although the proposal does not document whether the testing and from or modifications to them that may specify microbial limits for undesirable examination demonstrates that affect the identity, purity, quality, microorganisms, other non-FDA sources specifications are met. strength, and composition of a dietary have established acceptable, general Proposed § 111.35(n) would require ingredient or dietary supplement; • limits of microbial levels for dietary for any specification that is not met, that Determine whether all components, ingredients and dietary supplements you must conduct a material review and dietary ingredients, dietary (Refs. 66 and 67). These often include disposition decision under § 111.35(i). supplements, packaging, and labels Proposed § 111.35(o) would require conform to their specifications; limits for total aerobic microbial count, • which ranges from 104 to 107 per g, that you make and retain records, in Approve or reject all components, depending on source and nature of accordance with proposed § 111.125, to dietary ingredients, dietary ensure that you follow the requirements supplements, packaging, and labels; components; a total combined yeast and • molds count, which can range from 103 of this section. The proposal would Review and approve all master to 105 per g, again depending on source require these records to include, but manufacturing records and all and nature of components; and the would not limit them to: modifications to the master • absence of Salmonella species, E. coli The specifications established; manufacturing records; • • Review and approve all batch and Staphylococcus aureus. We The actual results obtained during production-related records which establish microbial limits for the monitoring operation; • Any deviation from specifications include, but are not limited to, cross- undesirable microorganisms based on and any unanticipated occurrences; referencing receiving and batch scientific information such as literature • Any corrective actions taken; production records, approval of a surveys and laboratory analyses. At this • The disposition decisions and material review and disposition time, however, we do not have followup; and decision, approval for reprocessing, and sufficient information to support • The identity of the individual approval for releasing for distribution. establishing microbial limits for qualified by training and experience Cross-referencing receiving and batch undesirable microorganisms for dietary who investigated any deviation from production records means that the ingredients. Therefore, the proposed specifications or unanticipated quality control unit must verify that the rule does not establish microbial limits occurrence and the identity of the batch record includes certain for dietary ingredients. However, you individual from the quality control unit documentation of the receiving records must be aware of potential who reviewed the results of that for the components and dietary contamination, regardless of whether it investigation. ingredients such as the unique identifier is due to filth, insects, microorganisms, These records would enable you to assigned to the shipment lot of or toxins, and you must test or examine show, and for us to determine, your components, testing results, a material as appropriate components, dietary compliance with proposed § 111.35. We review and disposition decision, if ingredients, or dietary supplements for generally determine CGMP compliance conducted, and approval for use by the those types of contamination that may by conducting inspections, so records quality control unit. adulterate or may lead to adulteration. play an important role during those • Review and approve all processes Proposed § 111.35(l) would explain inspections in determining CGMP for calibrating instruments or controls; that the tests you use to determine compliance. • Review all records for calibration of whether your components, dietary instruments, apparatus, gauges, and ingredients, and dietary supplements 2. What Requirements Apply to Quality Control? (Proposed § 111.37) recording devices; meet specifications must include at least • Review all records for equipment one of the following tests: Gross Proposed § 111.37(a) would require calibrations, inspections, and checks; organoleptic analysis, microscopic that you use a quality control unit to • Review and approve all laboratory analysis, chemical analysis, or other ensure that your manufacturing, control processes and testing results; appropriate test. These tests may vary in packaging, label, and holding operations • Review and approve all packaging detail or complexity depending on the in the production of dietary ingredients and label records which include, but are purposes of the test and the material and dietary supplements are performed not limited to, cross-referencing being tested. For example, if your in a manner that prevents adulteration receiving and batch production records, component is raw cranberries, and you and misbranding, including ensuring approval for repackaging and relabeling, are trying to verify that a shipment of that dietary ingredients and dietary and approval for releasing for red berries consists of raw cranberries, supplements meet specifications for distribution; an organoleptic (visual test) may be identity, purity, quality, strength, and • Collect representative samples of: sufficient (assuming that you recognize composition. This requirement does not 1. Each shipment lot of components, cranberries). However, if your mean that the manufacturer needs a dietary ingredients, dietary component is a chemical substance, and large number of employees. The supplements, packaging, and labels you are trying to verify that a shipment manufacturing process for an ingredient received for testing or examination, as of bulk powder is that chemical or a dietary supplement can be a needed, to determine whether the substance, chemical analysis may be sophisticated process, and all component, dietary ingredient, dietary more appropriate than an organoleptic organizational units that are involved in supplement, packaging, or labels meet analysis. critical formulation and manufacturing specifications before use or for testing,

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as needed, in consumer complaint manufacturing record where control is should require, in a final rule, written investigations; necessary to prevent adulteration; procedures for the quality control unit 2. Inprocess materials at points, steps, 3. Dietary ingredients and dietary duties required in § 111.37. If comments or stages, in the manufacturing process supplements that you manufacture to assert that written procedures are as specified in the master manufacturing ensure that they meet specifications; necessary, comments should include an record where control is necessary to and explanation of why the requirement is ensure the identity, purity, quality, 4. Packaged and labeled dietary necessary to prevent adulteration strength, and composition of dietary ingredients and dietary supplements to including how such a requirement ingredients or dietary supplements; ensure that you used the packaging would ensure the identity, purity, 3. Each batch of dietary ingredient or specified in the master manufacturing quality, strength, and composition of the dietary supplement that is record and you applied the label dietary ingredient or dietary manufactured to determine, before you specified in the master manufacturing supplement. Conversely, if comments record; assert that written procedures are not release it for distribution, whether it • meets its specifications for identity, Review and approve all material necessary, comments should include an purity, quality, strength, and review and disposition decisions; and explanation of why the requirement is • Approve the reprocessing or composition; and not necessary including how, in the distribution of returned dietary 4. Each batch of packaged and labeled absence of the requirement, one can ingredients or dietary supplements. dietary ingredients or dietary prevent adulteration and ensure the Proposed § 111.37 would impose identity, purity, quality, strength, and supplements to determine that you used duties on your quality control unit that the packaging specified in the master composition of the dietary ingredient or are necessary to the quality control unit. dietary supplement. manufacturing record and applied the The duties proposed in § 111.37 are label specified in the master important in any CGMP standards to 3. What Requirements Apply to manufacturing record; ensure that the dietary ingredient or Components, Dietary Ingredients, • Review and approve all material dietary supplement manufactured has Dietary Supplements, Packaging, and review and dispostion decisions; and the identity, purity, quality, strength, Labels You Receive? (Proposed § 111.40) • Collect representative reserve and composition intended. If a quality Proposed § 111.40 would establish samples of each shipment lot of control unit did not do, that is, lacked requirements to ensure that the components, dietary ingredients, and the responsibility and authority to do, components, dietary ingredients, dietary dietary supplements and each batch of the actions described in proposed supplement, packaging, and labels you dietary ingredient or dietary § 111.37, coordination between various receive are, in fact, what you ordered. supplement. The proposal would parts of your manufacturing, packaging, We are proposing these requirements require that you keep the reserve or holding operation might become because receiving the wrong materials samples for 3 years from the date of haphazard and the product could be can lead to mixups or the use of wrong manufacture for use in appropriate adulterated. For example, if your quality materials and this could result in the investigations, such as, consumer control unit did not make decisions manufacture of an adulterated and complaint investigations to determine, concerning use of components, dietary misbranded dietary ingredient or dietary for example, whether the dietary ingredients, and dietary supplements supplement. ingredient or dietary supplement you receive, you could use the wrong Proposed § 111.40(a)(1) and (a)(2) associated with a consumer complaint component, or a contaminated would apply to components, dietary failed to meet any of its specifications component in manufacturing a dietary ingredients, or dietary supplements you for identity, purity, quality, strength, ingredient or dietary supplement. If receive, and would require that you: and composition. We tentatively decide your quality control unit makes • Visually examine each container or to require that you keep reserve samples decisions concerning releasing dietary grouping of containers in a shipment for for 3 years because we believe that 3 ingredients and dietary supplements for appropriate content label, container years would be a reasonable time period distribution, it will prevent you from damage, or broken seals to determine beyond the date of manufacture for releasing for distribution an adulterated whether the container’s condition has appropriate followup of consumer dietary ingredient or dietary supplement resulted in contamination or complaints received during the before the necessary tests results deterioration of the components, dietary marketing period. Because we have not confirm that the dietary ingredient or ingredients, or dietary supplements; proposed requirements for expiration dietary supplement meets specifications • Visually examine the supplier’s dating of dietary supplements, we for identity, purity, quality, strength, invoice, guarantee, or certification to tentatively conclude that the date of and composition. ensure that the components, dietary manufacture is an appropriate starting Your quality control unit must ingredients, or dietary supplements are time for the retention period. This document, at the time of performance, consistent with your purchase order and requirement in proposed § 111.37(b)(11) that it performed the review, approval, perform testing, as needed, under also would require that the reserve or rejection requirements established in proposed § 111.35(g), to determine samples be identified with the batch or accordance with proposed § 111.37 by whether specifications are met. lot number and consist of at least twice recording the date when the review, We state in proposed § 111.40(a)(2) the quantity necessary for tests; approval, or rejection and requirement that you must perform testing ‘‘as • Perform appropriate tests and/or was performed, and the signature of the needed.’’ This flexibility is necessary, examinations of: person performing the requirement. As given the proposed testing scheme in 1. Components, dietary ingredients, we explained elsewhere in this § 111.35(g). As previously discussed in dietary supplements, packaging, and document, one of the ways we proposed § 111.35(e), you must establish labels received to ensure that they meet determine compliance with CGMP’s is specifications for any points, steps, or specifications; by conducting inspections, so records stages in the manufacturing process 2. Dietary ingredient and dietary enable you to show, and for us to where control is necessary to prevent supplement batch production at points, determine, compliance with CGMP’s. adulteration. In addition, we propose to steps, or stages identified in the master We invite comment on whether we require, under § 111.35(e), certain

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specifications, i.e., identity, purity, supplier’s invoice, guarantee, or deterioration of the packaging and quality, strength, and composition, for certification. labels; components, dietary ingredients, and Under § 111.40(b)(3) through (b)(5), • Quarantine packaging and labels dietary supplements upon receipt. we would require that you: until your quality control unit tests or However, in § 111.35(g), we are • Quarantine components, dietary examines a representative sample to proposing to provide some flexibility for ingredients, or dietary supplements determine that specifications are met. when testing is required for the identity, until your quality control unit reviews You must conduct at least a visual purity, quality, strength, and the supplier’s invoice, guarantee, or identification on the containers and composition specifications. Specifically, certification and performs testing, as closures. If specifications are not met, if you perform finished product testing needed under proposed § 111.35(g), of a the proposal would require that you under § 111.35(g)(1) for identity, purity, representative sample to determine that conduct a material review and make a quality, strength, and composition, then specifications are met. These are the disposition decision and also require under § 111.40(a)(2) we would require specifications that you would set in your quality control unit to approve and that you visually compare the supplier’s accordance with proposed § 111.35(e) release packaging and labels from invoice, guarantee, or certification with and appropriate tests or examinations quarantine before you use them; • your purchase order to confirm used in accordance with proposed Identify each shipment lot of consistency between your order and the § 111.35(g) for materials that you packaging and labels in a manner that supplier’s invoice, guarantee, or receive. If specifications are not met, allows you to trace the shipment lot to certification. You would not need to do proposed § 111.40(a)(3) would require the supplier, the date received, the testing upon receipt. That is why we that you conduct a material review and name of the packaging and label, and have added language to § 111.40(a)(2) make a disposition decision. Your the status (e.g., quarantined, approved, that states, ‘‘and perform testing, as quality control unit must approve and or rejected) and to trace the shipment lot needed, to determine whether release the components, dietary to the dietary ingredient or dietary specifications are met.’’ Alternatively, ingredients, and dietary supplements supplement manufactured and for specifications that you establish from quarantine before you use them; distributed. Like proposed • Identify each lot of components, (e.g., other than the identity, purity, § 111.40(a)(4), proposed § 111.40(b)(3) dietary ingredients, or dietary quality, strength, and composition of the would require that you use this unique supplements in a shipment in a manner components, dietary ingredients or identifier whenever you record the that allows you to trace the shipment to dietary supplements received), such as disposition of each shipment lot the supplier, the date received, the for a holding temperature necessary received; and name of the component or dietary • Hold packaging and labels under during transportation to your physical supplement, and the status (e.g., conditions that will protect against plant to avoid adulteration, you would quarantined, approved, or rejected) and contamination and deterioration and be required to ensure by testing or to trace the shipment lot to the dietary avoid mixups. examination that the specified ingredient or dietary supplement Proposed § 111.40(c) deals with temperature was used. manufactured and distributed. You written documentation and records. If you do not perform finished must use this unique identifier Proposed § 111.40(c)(1) would require product testing under § 111.35(g)(1) for whenever you record the disposition of that the person who performs the identity, purity, quality, strength, or each shipment lot received. Using a requirements established in accordance composition, then you would need to unique identifier throughout the with this section to document, at the test for that nontested finished product manufacturing process will make it time of performance, that he or she specification upon receipt. In that case, possible to track and account for performed the requirements. The testing would be needed under both components, dietary ingredients, and documentation would have to include, proposed §§ 111.35(g)(2) and dietary supplements you receive and is but not be limited to, the date that the 111.40(a)(2). You still would need to necessary to conduct investigations of requirement was performed; the visually compare the supplier’s invoice, consumer complaints; and signature of the person performing the guarantee, or certification with your • Hold components, dietary requirement; any test results; and any purchase order to confirm consistency ingredients, or dietary supplements material review and disposition between your order and the supplier’s under conditions that will protect decision conducted, and the disposition invoice, guarantee, or certification. against contamination, deterioration, of any rejected material. Thus, for those specifications of and avoid mixups. For example, you Proposed § 111.40(c)(2) would require identity, purity, quality, strength, or must segregate components that your that you keep component, dietary composition for which your quality quality control unit has not released for supplement, packaging, and label control unit determines that you cannot use from those components that have receiving records in accordance with test for at the finished product stage been released for use. This provision proposed § 111.125. These records are (because there are no available would require that you refrigerate necessary to be able to determine the scientifically valid methods), then you components that are subject to source of the component, dietary would be required, under contamination or deterioration without ingredient, dietary supplement, § 111.35(g)(2)(i) to test incoming such refrigeration or that otherwise packaging, and labels, so that if shipment lots of components, dietary require storage at a certain temperature. adulteration of dietary ingredient or ingredients, or dietary supplements for Proposed § 111.40(b) would apply to dietary supplement occurs, the records any such specification to determine packaging and labels you receive and will show the source of the material so whether it is met, and such a test also would require that you: that its use can be stopped. In addition, would be considered to be necessary • Visually examine each container or the records will show the basis on under § 111.40(a)(2). As discussed grouping of containers in a shipment for which each component, dietary earlier, you may not rely on a supplier’s appropriate content labels, container ingredient, dietary supplement, certification or guaranty in lieu of such damage, or broken seals to determine packaging, or label was released for use testing, and in addition to such testing, whether the container’s condition has in dietary ingredient or dietary still would need to visually examine the resulted in contamination or supplement production. These records

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are necessary to demonstrate steps, or stages in the master appropriate weight or measure for the compliance with the CGMP and quality manufacturing record where control is component); control procedures. necessary to prevent adulteration, and • The identity and weight or measure We invite comment on whether we establish controls and procedures to of each dietary ingredient that will be should require, in a final rule, that you ensure that each batch of dietary declared on the Supplement Facts label establish and follow written procedures ingredient or dietary supplement and the identity of each ingredient that that implement proposed § 111.40(a) manufactured meets those will be declared on the ingredients list and (b). If comments assert that written specifications. For example, assume that of the dietary supplement in compliance procedures are necessary, comments your manufacturing process blends with section 403(s) of the act. For should include an explanation of why various ingredients in order to make a proposed § 111.45(b)(4), therefore, the the requirement is necessary to prevent dietary supplement. Under proposed master manufacturing record for our adulteration including how such a § 111.45(a), your master manufacturing hypothetical product would state that requirement would ensure the identity, record would establish controls to look the dietary ingredient is Vitamin C at purity, quality, strength, and at specific steps in the manufacturing 250 mg (because Vitamin C would be composition of the dietary ingredient or process and evaluate the blends for the dietary ingredient declared on the dietary supplement. Conversely, if specific ingredients to ensure that you Supplement Facts label) and identify comments assert that written procedures added the correct ingredients at the starch, microcrystalline cellulose, and are not necessary, comments should correct amounts or concentrations that dicalcium phosphate (because those include an explanation of why the meet your specifications before the ingredients would be in the product’s requirement is not necessary including blend proceeds to the next ingredient list, but not on the how, in the absence of the requirement, manufacturing step, in accordance with Supplement Facts label); and one can prevent adulteration and ensure the master production record. • A statement that explains any the identity, purity, quality, strength, Throughout the manufacturing process, intentional excess amount of a dietary and composition of the dietary you would evaluate, as necessary, any ingredient. We recognize that some ingredient or dietary supplement. points, steps, or stages where control is manufacturers intentionally add a 4. What Requirements Apply to necessary to prevent adulteration to specific amount of a dietary ingredient Establishing a Master Manufacturing ensure that specifications established in excess of the declared label amount Record? (Proposed § 111.45) for those points, steps, or stages are met. so that the finished product can meet the label declaration for that dietary Proposed § 111.45 would require that Proposed § 111.45(b) would establish ingredient throughout the product’s you prepare and follow a written master additional requirements for the master shelf life. For our hypothetical vitamin manufacturing record for each type of manufacturing record. These proposed requirements would include: C tablet, if you added an extra 25 mg of dietary ingredient or dietary supplement • that you manufacture and for each batch The name of the dietary ingredient vitamin C to ensure that your product size to ensure uniformity from batch to or dietary supplement to be contains at least 250 mg of vitamin C batch. A master manufacturing record is manufactured and the strength, throughout its shelf life, your master analogous to a recipe that sets forth the concentration, weight, or measure of manufacturing record would state the ingredients to use, the amounts of each dietary ingredient for each batch component and the actual amount of the ingredients to use, the tests to perform, size. For example, assume you have a component as ‘‘Vitamin C, 250 mg, (10 and the instructions for preparing the million tablet batch size of a vitamin C percent excess) 25 mg’’ or ‘‘275 mg of amount the recipe calls for, e.g., 250 mg, product in 250 mg tablets and that the Vitamin C.’’ So, proposed § 111.45(b)(5) 500 mg, vitamin C. This master only other ingredients in your product would require the master manufacturing manufacturing record helps ensure that are starch, microcrystalline cellulose, record to specify the controlled amount you manufacture each ingredient or and dicalcium phosphate. Under of the excess dietary ingredient dietary supplement in a consistent and proposed § 111.45(b)(1), your master necessary to achieve the declared label uniform manner. If you neglect to follow manufacturing record would state, declaration. This provision is not the master manufacturing record, you ‘‘Vitamin C 250 mg, 1,000,000 tablets’’; intended to allow a manufacturer to add would not add all of the necessary • A complete list of components to be excess dietary ingredients in components in the appropriate strength used. Again, to continue using the unspecified amounts that would be in or amount, and this would result in an example immediately above, for excess of the amount actually needed to adulterated ingredient or dietary proposed § 111.45(b)(2), the master meet the label declaration. supplement. manufacturing record also would show The agency considered whether to Therefore, proposed § 111.45(a) is that you used starch, microcrystalline propose requirements in this proposed necessary to ensure that you prepare cellulose, and dicalcium phosphate in rule for expiration dating, shelf-life and follow a written master the product; dating, or best if used by dating manufacturing record for each type of • An accurate statement of the weight (hereinafter referred to as expiration dietary ingredient or dietary supplement or measure of each component to be dating). Although we recognize that to ensure that all the necessary used. For example, under proposed there are current and generally available components as specified, and in the § 111.45(b)(3), the master manufacturing methods to determine the expiration amounts specified, are used to record for our hypothetical vitamin C date of some dietary ingredients, for manufacture each batch to ensure tablet would state the amount of each example vitamin C, we are uncertain uniformity from batch to batch and to component used, such as ‘‘200 lbs. of whether there are current and generally ensure that the dietary ingredient or Vitamin C, 10 lbs. of microcrystalline available methods to determine the dietary supplement is not adulterated. cellulose’’ and the amounts of starch expiration dating of other dietary Proposed § 111.45(a)(1) and (a)(2) and dicalcium phosphate used. (We ingredients, especially botanical dietary describe the proposed contents of the would not require that you show the ingredients. We are not proposing master manufacturing record. The amount using an appropriate English or expiration dating at this time because master manufacturing record would metric standard in a particular way, but we have insufficient scientific identify specifications for the points, we would expect that you use the most information to determine the biological

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activity of certain dietary ingredients depending on the type of material you component and another person used in dietary supplements, and such use, packaging could adulterate your verifying the addition; information would be necessary to dietary ingredients or dietary 4. Special notations and precautions determine an expiration date. Further, supplements. For example, the correct to be followed; and because official validated testing container may protect the dietary 5. Corrective action plans for use methods (i.e., AOAC or FDA) for dietary ingredient or dietary supplement from supplements are evolving, especially for the deteriorating effects of light and if when a specification is not met. botanical dietary ingredients, few an incorrect container is used that does You should think of the written official methods are available to assess not provide this protection, your dietary instructions as being similar to a recipe; the strength of a dietary ingredient in a ingredient or dietary supplement could they should cover the important steps in dietary supplement. Nevertheless, if you deteriorate and could be adulterated. your manufacturing, packaging, or use an expiration date on a product, you The description might consist of holding processes, but they also should should have data to support that date. information such as the type of bottle to tell the reader about any special You should have a written testing be used with your manufacturer’s code directions to follow, tests to perform, program designed to assess the stability number, if available; a description of the precautions to be observed, and characteristics of the dietary cap to be used with the liner specified personnel to use. supplement, and you should use the with a manufacturer’s code number, if Proposed § 111.45(c) would require results of the stability testing to applicable; additional materials needed that you have your quality control unit determine appropriate storage in packaging; and the control number, if review and approve each master conditions and expiration dates. applicable, of the label to be used in manufacturing record and any We invite comment on whether any packaging the dietary ingredient or modifications to a master manufacturing final dietary ingredient and dietary dietary supplement. We are not aware of record. This provision reiterates the supplement CGMP rule should contain evidence of that dietary supplement quality control requirements in provisions regarding expiration dating manufacturers are using unlawful proposed § 111.37. This proposed and the feasibility of conducting tests containers. Section 201(s) of the act requirement is necessary to prevent needed to support such dates. We also defines ‘‘food additive’’ to mean any potential problems that could result invite comments on whether to require substance the intended use of which from changes to the master expiration dating on certain dietary results or may reasonably be expected to manufacturing record made by persons ingredients and not others, for example, result, directly or indirectly, in it’s who are not qualified to assess the require expiration dating of vitamin, becoming a component or otherwise impact of such changes. By having your mineral, and amino acid, but not of affecting the characteristics of any food quality control unit review and approve botanical dietary ingredients. (including any substance intended for the master manufacturing record and Proposed § 111.45(b) also would use in producing, manufacturing, changes to that record, you will reduce require your master manufacturing packing, processing, preparing, treating, your risk of not detecting the inclusion record to contain: packaging, transporting, or holding of an incorrect ingredient in the batch • A statement of theoretical yield of food; and including any source of a manufactured dietary ingredient or radiation intended for any such use). production. The quality control unit dietary supplement expected at each Materials used in packaging that come review will ensure that necessary point, step, or stage of the in contact with food or that react inprocess verifications and testing manufacturing process where control is chemically with food, may be instructions are included in the master necessary to prevent adulteration, and considered to be food contact manufacturing record. Further, any the expected yield when you finish substances or food additives. Foods and changes to the master manufacturing manufacturing the dietary ingredient or dietary ingredients may contain active record will reduce your risk of adding dietary supplement, including the substances that can react with packaging the wrong component, dietary maximum and minimum percentages of materials. Thus, FDA is proposing a ingredient or dietary supplement or the theoretical yield beyond which a CGMP requirement that manufacturer’s wrong amount of a component, dietary deviation investigation of a batch is use containers that are lawful under the ingredient or dietary supplement. For performed and material review is act and that do not impose a risk such example, in one case, a dietary conducted and disposition decision is as leakage or the possibility of physical supplement manufacturer made a made. In this particular instance, when contamination of dietary ingredients or product that had 10 times the labeled we refer to the manufacture of dietary dietary supplements. Information on amount of vitamin D, but did not ingredients, we mean to say that if you packaging and labels materials will also perform any tests for vitamin D use a master manufacturing record to be helpful in case an adverse event concentration as part of its review of its make dietary ingredients (that is, you occurs; and batch records (Ref. 23). The make dietary ingredients rather than • Written instructions including, but manufacturer discovered the dietary supplements), the proposal not limited to: superpotent batches only after State would require the master manufacturing 1. Specifications for each point, step, authorities had contacted them, and had record to contain a theoretical yield at or stage in manufacturing the dietary to recall the product. Had the each point, step, or stage where control ingredient or dietary supplement manufacturer’s quality control unit is necessary to prevent adulteration. necessary to prevent adulteration; reviewed the master manufacturing and Likewise, if you manufacture dietary 2. Sampling and testing procedures; batch production records earlier, the supplements, the proposal would 3. Specific actions necessary to superpotent batches that represented a require your master manufacturing perform and verify points, steps, or change from the master manufacturing record to contain a theoretical yield at stages, necessary to meet specifications record might have been detected before each point, step, or stage where control and otherwise prevent adulteration, the product left the manufacturer, and is necessary to prevent adulteration; including, but not limited to, one person the recall could have been avoided. The • A description of packaging and a weighing or measuring a component manufacturer later took steps to increase copy of the label to be used. We propose and another person verifying the weight its audits of batch records, to require to require such information because, or measure and one person adding the approval of all changes to its master

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formulas, and to perform tests for its record and modifications to that record Further, we seek comment on whether manufacturing activities. properly rests with the quality control any of the proposed requirements in this In another example, several unit because the individuals in the section are not necessary to prevent consumers and employees at spas in quality control unit would have the adulteration and to ensure the identity, Massachusetts and Arizona complained expertise to make a decision whether purity, quality, strength, and of dizziness, vomiting, or the master manufacturing record, if composition of the dietary ingredient or lightheadedness after consuming several followed, will result in an unadulterated dietary supplement. If comments assert dietary supplements. We did an dietary ingredient or dietary supplement that certain provisions are not inspection and found that, in the case of and does not mean that the necessary, comments should include an two products, the manufacturer’s manufacturer needs a large number of explanation of why the requirement is formula called for the use of a product employees. not necessary including how, in the having 0.2 percent selenium by weight, You should note that, while the absence of the requirement, one can but the manufacturer’s records showed quality control unit is responsible for prevent adulteration and ensure the that it used a product that had 5 percent reviewing and approving the master identity, purity, quality, strength, and selenium by weight. This difference manufacturing record and changes to composition of the dietary ingredient or meant that the supplements, instead of that record, this does not mean that the dietary supplement. If comments agree containing 200 µg of selenium, quality control unit must prepare the that the proposed requirements are contained between 400 to 4,699 µg of master manufacturing record itself or act necessary for reasons other than those selenium. After further investigation, we without any involvement from other we have provided, the comments should determined that the error occurred parts of your manufacturing operation. so state and provide an explanation. when the quantity of selenium to be Other individuals or groups may help used was printed in kilograms (kg), prepare, review, and approve drafts of a 5. What Requirements Apply to instead of g. The change in unit master manufacturing record and draft Establishing a Batch Production Record? measurement represents a change from changes to an existing master (Proposed § 111.50) the master manufacturing record. Had manufacturing record, but the quality Proposed § 111.50(a) would require the manufacturer’s quality control unit control unit is responsible for reviewing that you prepare a batch production reviewed the change in the master and approving the final master record every time you manufacture a manufacturing record, it probably manufacturing record and modifications batch of dietary ingredient or dietary would not have approved the change to to that record. supplement. This requirement would include use of the product containing Proposed § 111.45(d) would pertain to apply to any batch, including a batch the higher percent of selenium. written documentation and approved for reprocessing by the quality One comment to the ANPRM opposed recordkeeping. Proposed § 111.45(d) control unit. The proposal also would a requirement that would have a quality would require that you keep your require the batch production record to control unit review and approve the master manufacturing records in include complete information relating to master manufacturing record. The accordance with proposed § 111.125. the production and control of each comment stated that this review and The master manufacturing record in batch. The batch production record is approval process is overly restrictive addition to the batch production records necessary to document that you because other units can perform this will ensure that a complete history of followed the master manufacturing function and only need be audited or each batch of dietary ingredient or record to make each batch of dietary periodically verified by the quality dietary supplement is available for your ingredients or dietary supplements. It is control unit. The comment suggested review in the event that a problem arises important to document such that the quality control unit assure that with a particular batch. These records information for each batch because it a master production and control record also are necessary to demonstrate serves as a check that the master must be prepared for the manufacture of compliance with the CGMP and quality manufacturing record was followed. If each dietary ingredient and dietary control procedures. you later discover problems with a supplement, rather than review and We invite comment on whether a particular batch of dietary ingredients or approve such records. written procedure for preparing the dietary supplements, you could look at We do not agree that the review and master manufacturing record and the batch production record for that approval process is overly restrictive making any modifications to the record, batch, compare it to the master and decline to adopt the comment’s consistent with the requirements in this manufacturing record, and see whether suggestion. The quality control unit can section, should be required in a final the problems occurred because of a be composed of individuals from rule. If comments assert that written failure to follow the master various parts of the organization. procedures are necessary, comments manufacturing record. These records, in Removing this responsibility from the should include an explanation of why conjunction with your master quality control unit would diminish the the requirement is necessary to prevent manufacturing records, will create a quality control unit’s responsibility and adulteration including how such a written system which, when followed, authority. As stated earlier, the requirement would ensure the identity, will result in a reproducible, high- manufacturing process of a dietary purity, quality, strength, and quality, and uniform dietary ingredient ingredient or a dietary supplement can composition of the dietary ingredient or or dietary supplement. be a sophisticated process, and we dietary supplement. Conversely, if Proposed § 111.50(b) would require understand that all organizational units comments assert that written procedures the batch production record to that are involved in critical formulation are not necessary, comments should accurately follow the appropriate master and manufacturing steps, such as include an explanation of why the manufacturing record and also require production, engineering, research, and requirement is not necessary including that you perform each step in producing regulatory affairs, should review and how, in the absence of the requirement, the batch. Even if you have someone approve a master production order and one can prevent adulteration and ensure else (such as a contractor) perform a changes to it. However, the the identity, purity, quality, strength, particular step, you would remain responsibility for reviewing and and composition of the dietary responsible for ensuring that each step approving the master manufacturing ingredient or dietary supplement. is done that complies with the

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requirements in proposed part 111. The record review and any approval for instead of containing 200 µg of contractor, however, is also considered reprocessing or repackaging. selenium, contained between 400 to a manufacturer and must comply with Proposed § 111.50(b) and (c) are 4,699 µg of selenium. As discussed the regulations that apply to the necessary to ensure that you made your earlier, the quality control unit review responsibilities that it has specifically batches correctly under the master and approval of the master contracted to perform. manufacturing record and that you manufacturing record would have noted Proposed § 111.50(c) would specify correctly performed each significant the change in percent selenium by the batch production record’s contents. step in the manufacturing process. If weight and the necessary changes to the The proposal would require that certain you did not create a batch production master manufacturing record could have information be included in the batch record for each batch production that been made. The quality control unit production record including, but not be accurately followed the master review and approval of the batch limited to, the following information: manufacturing record, you would not be production record provides another • The batch, lot, or control number; sure that your dietary ingredient or check to ensure that a mixup has not • Documentation, at the time of dietary supplement was not adulterated. occurred. Had the manufacturer’s performance, showing the date on The master manufacturing record is quality control unit compared the which each step of the master intended to ensure batch to batch master manufacturing record to the manufacturing record was performed, uniformity and to prevent adulteration. batch production record, it would have and the initials of the persons Your batch production record also may noticed the mixup during the performing each step including, but not be valuable in the event of a product manufacturing process and prevented limited to, the person responsible for recall. We seek comment on whether the use of the higher percentage weighing or measuring each component any of the proposed requirements in this selenium dietary ingredient. The used in the batch and the person section are not necessary to prevent information that would be required responsible for adding the components adulteration and to ensure the identity, under proposed § 111.50(c) would help to the batch; purity, quality, strength, and you determine what product was • The identity of equipment and composition of the dietary ingredient or manufactured, when it was processing lines used in producing the dietary supplement. If comments assert manufactured, how it was batch; that certain provisions are not manufactured, and where it was • The date and time of the necessary, comments should include an manufactured. As another example, if explanation of why the requirement is maintenance, cleaning, and sanitizing of your batch production records identify not necessary including how, in the the equipment and processing lines the equipment and processing lines absence of the requirement, one can used in producing the batch; being used, you would be able to go to prevent adulteration and ensure the • The shipment lot unique identifier that piece of equipment or to that identity, purity, quality, strength, and of each component, dietary ingredient, processing line and determine which composition of the dietary ingredient or dietary supplement, packaging, and dietary ingredient or dietary supplement dietary supplement. If comments agree is being manufactured or processed. label used; that the proposed requirements are Further, if your batch records reflect the • The identity and weight or measure necessary for reasons other than those initials of those persons who weighed a of each component used; we have provided, the comments should component, added that specific • The initials at the time of so state and provide an explanation. component, and performed a particular performance or at the completion of the In one case (Ref. 27), we found that a step to prevent adulteration of the batch of the person responsible for manufacturer had produced a subpotent product, you would be able to see who verifying the weight or measure of each folic acid product. When the was responsible for a particular action component used in the batch; manufacturer reviewed the batch • and, if necessary, to consult that person The initials at the time of production records, it discovered that in the event of a problem or to see how performance or at the completion of the the bulk product was not mixed he or she performed a particular task. In batch of the person responsible for properly, and this caused the folic acid addition, if your batch production verifying the addition of components to to be distributed poorly throughout the records contain batch or lot numbers the batch; product. Thus, in this instance, the • and if you later discover a problem with A statement of the actual yield and batch production record helped identify a particular batch, that information will a statement of the percentage of the point in the manufacturing process help you investigate the problem by theoretical yield at appropriate phases when the error occurred, and the reason showing you the manufacturing history of processing; why the error occurred and enabled the • for that particular batch. The actual test results for any manufacturer to correct the problem. A comment to the ANPRM stated that testing performed during the batch Review of batch production records keeping written records of equipment production in accordance with might have prevented another incident cleaning and use, including the date, § 111.35(m); where several persons experienced product, and lot number of each batch • Documentation that the dietary dizziness, vomiting, or lightheadedness processed, would be burdensome ingredient and dietary supplement after consuming vitamin and mineral compared to the benefits it would meets specifications; products. As we mentioned in our provide, particularly when equipment is • Copies of all container labels used discussion of proposed § 111.45, this cleaned after each use. The comment and the results of examinations incident involved a mixup during the added that manufacturers can modify conducted during the label operation to manufacturing process where the their production records to note which ensure that the containers have the manufacturer’s master manufacturing machines they used. correct label; record called for the use of a product We disagree with the comment. • Any documented material review having 0.2 percent selenium by weight, Written records will help you to ensure and disposition decision in accordance but the manufacturer’s batch records that all cleaning operations are with § 111.35(j); and showed that it used a product that had performed correctly and, if problems do • The signature of the quality control 5 percent selenium by weight. This occur with the production of a product, unit to document batch production difference meant that the supplements, will help you determine whether those

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problems are associated with receiving records including review of the correct reserve sample in the event maintenance, cleaning, or sanitizing testing and examination results; that there is a problem with a particular operations. Batch and lot information, • Identification of any deviation from batch. as we stated earlier, will let you identify the master manufacturing record that Proposed § 111.50(i) would require batches or lots that may have been may have caused a batch or any of its that you keep your batch production affected by any equipment or utensil components to fail to meet records in accordance with proposed that was improperly maintained, specifications identified in the master § 111.125. The batch production records cleaned, or sanitized. manufacturing record; in addition to the master manufacturing • Proposed § 111.50(d) and (e) would Records of investigations, records will ensure that a complete set forth your quality control unit’s conclusions, and corrective actions history of each batch of dietary responsibilities regarding batch performed in accordance with proposed ingredient or dietary supplement is § 111.50(d); and available for your review in the event production records. These • responsibilities relate to not only the The identity of the person qualified that a problem arises with a particular review but the documentation of their by training and experience who batch. These records also are necessary review and decisions about whether a performed the investigation in to demonstrate compliance with the batch could be reprocessed. As we accordance with proposed § 111.50(d). CGMP and quality control procedures. Proposed § 111.50(f) would prohibit noted in our discussion of proposed you from reprocessing a batch that 6. What Requirements Apply to § 111.37, the quality control unit has deviates from the master manufacturing Laboratory Operations? (Proposed special knowledge and expertise to record unless your quality control unit § 111.60) determine if a batch is produced approves it for reprocessing. Proposed Proposed § 111.60 would establish correctly, that those records are § 111.50(f) also would prohibit you from various requirements for laboratory complete, and that it is appropriate to reprocessing a dietary ingredient or operations. Proposed § 111.60(a) would reprocess a batch. The quality control dietary supplement if it is rejected require that you use adequate laboratory unit also serves as a quality control because of contamination with facilities to perform any necessary tests check that the batch production record microorganisms of public health or examinations to determine that accurately follows the master significance or other contaminants, such components, dietary ingredients, and manufacturing record. A quality control as heavy metals because you cannot rely dietary supplements you receive meet unit review of batch production records on reprocessing to correct public health specifications; that specifications are could have detected and corrected the concerns that a product with pathogens met during inprocess as specified in the previously discussed manufacturing and/or heavy metals would present. master manufacturing record; and that error caused by use of the dietary Proposed § 111.50(g) would require the dietary ingredients and dietary ingredient with the incorrect selenium. that you meet all specifications supplements you manufacture meet Therefore, the review and established in the master manufacturing their specifications. documentation by the quality control record for any batch of dietary One comment to the ANPRM unit of batch production records ingredient or dietary supplement that is recommended that the regulations provides the necessary quality reprocessed and would require your related to laboratory operations apply to assurance to prevent the production of quality control unit to evaluate and laboratory facilities located and an adulterated dietary ingredient or approve the batch before releasing for operated within a company and those dietary supplement. distribution. This requirement is facilities that a company may contract Specifically, proposed § 111.50(d) intended to ensure that a reprocessed with that are located elsewhere. would require your quality control unit batch is not subject to any lesser Proposed § 111.60(a) would apply to to review in accordance with specifications than are otherwise laboratory facilities generally and is not § 111.37(b)(5) the batch production applicable to a nonreprocessed batch. restricted to laboratory facilities located record. If a batch production record Proposed § 111.50(g) also would require and operated within a company. In deviates from the master manufacturing that you document the results of the other words, even if you hire a private record, including any deviation from quality control unit’s reevaluation in the laboratory to perform various tests for specifications, proposed § 111.50(d)(1) batch production record. you, proposed § 111.60(a) would require would require your quality control unit Proposed § 111.50(h) would require that you make sure that the private to conduct a material review and make that you collect representative reserve laboratory’s facilities are adequate to a disposition decision and record any samples of each batch of dietary perform whatever tests are necessary. decision in the batch production record. ingredient or dietary supplement and to The most important point in proposed Proposed § 111.50(d)(2) would instruct keep the reserve samples for 3 years § 111.60(a), however, is not where the your quality control unit to not approve from the date of manufacture for use in facility is located, but whether the and release for distribution any batch of appropriate investigations including, laboratory facility is adequate for the dietary ingredient or dietary supplement but not limited to, consumer complaint tests and examinations that need to be that does not meet all specifications. investigations to determine whether, for done. Proposed § 111.50(e) would require example, the dietary ingredient or Proposed § 111.60(b)(1) would require your quality control unit to document in dietary supplement associated with a that you establish and follow laboratory accordance with § 111.37(c) the review consumer complaint failed to meet any control processes that the quality performed in accordance with proposed of its specifications for identity, purity, control unit has approved. For example, § 111.50(d). The proposal would require quality, strength, and composition. under proposed § 111.60(b)(1)(i) and the quality control unit to document Reserve samples also may prove helpful (b)(1)(ii), the laboratory control this review at the time it does the review in investigating possible tampering or processes would include use of criteria and would require the review and counterfeiting of your products. We for selecting appropriate testing and documentation to include, but would invite comment on whether we should examination methods and for not limit them to, the following: require, in a final rule, that you identify establishing appropriate specifications. • Review of component, dietary each reserve sample with the batch Specifications play an important role in ingredient, and dietary supplement number so that you can readily identify CGMP’s because they may help

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determine whether a dietary ingredient ingredient is adulterated with another ingredients, or dietary supplements, and or dietary supplement is adulterated. substance or is a poisonous plant that packaging and labels. Your sampling Criteria for establishing appropriate should not be ingested. plans should include reserve samples, specifications must be specific to the Misidentification or a mixup of too, because reserve samples will enable component, dietary ingredient, or botanical ingredients can cause a you to investigate and identify possible dietary supplement. The specifications product to be adulterated (Refs. 6 and 69 manufacturing problems in the future. are the parameters that you must meet. through 73). Heavy metals may The proposal would not specify any For example, for ascorbic acid, your contaminate botanical and natural- particular sampling plan; it would leave specifications would include all the occurring ingredients if a plant is grown such details to your discretion so that criteria that you want your incoming and harvested in an area contaminated you can develop a sampling plan that dietary ingredient or for your finished with heavy metals or even processed in suits your products and your testing product to meet. For example, you a contaminated area (Refs. 74 and 75). needs. might establish criteria for the Pesticides also may contaminate Proposed § 111.60(b)(iv) through appearance, color, odor, identity using botanical ingredients; this occurs in (b)(vi) would require the laboratory one or more tests, heavy metals (e.g., rural areas where the botanical plant control processes to include: lead, arsenic, mercury), and organic grow alongside commercial crops (Ref. • Use of criteria for selecting standard volatile impurities. 64). Therefore, you must consider what reference materials used in performing Similarly, criteria for selecting criteria you need to include for the tests and examinations. An appropriate test and examination types of testing that are needed, for authenticated plant reference material methods include parameters such as example, for heavy metal or pesticide may be used as standard reference type of tests and examinations needed contamination, or identity testing material in performing certain based on the component you receive. criteria for selecting appropriate test organoleptic examinations. An For example, you might use methods, for example, whether to use authenticated plant reference material is morphological characters and organoleptic or chemical analyses for material that has been authenticated as organoleptic characteristics in some identity testing. In addition, you must the correct plant species and correct cases to identify botanical dietary establish criteria for specifications for plant part(s) by a qualified plant ingredients at the time of collection or the tests and examinations used. taxonomist. As described earlier in this for unprocessed botanicals. When Establishing such criteria for document, an organoleptic examination sufficient morphological characters are specifications and appropriate test and may be an appropriate examination to present to separate the plant species examination methods will provide you confirm plant identity when sufficient from other plant species, an accurate with internal processes that will help morphological characters are present to identification can be made since prevent misidentification and separate the plant species from other morphological characters are the sole contamination. plant species. For microscopic and basis of distinguishing most of the Proposed § 111.60(b)(1)(iii) would chemical tests, a reference material is a world’s plant species. However, require your laboratory control highly purified compound that is well unprocessed botanicals that do not processes to include use of sampling characterized, and you would use the contain all the plant parts necessary to plans for obtaining representative reference material to perform tests include adequate morphological samples of: including calibration tests. In general, characters to assure the correct species • Components, dietary ingredients, there are two types of reference should have other identity aids or tests and dietary supplements received; materials: (1) Compendial reference to assure the identity of the botanical. It • Inprocess materials during the standards that do not require is possible to use only a picture as an batch manufacturing when testing or characterization; and (2) noncompendial identity standard for whole fresh Ginkgo examination is required in the master standards. Noncompendial standards leaf from a cultivated field because the manufacturing record; should be of the highest purity that can Ginkgo leaf is not easily confused with • Each batch of dietary ingredient or be obtained by reasonable effort and the leaf shape, venation, and color of dietary supplement manufactured to should be thoroughly characterized to other leaves that could be present in the determine that the dietary ingredient or assure their identity, purity, quality, and field. In contrast, powdered Ginkgo leaf dietary supplement meets strength. Ideally, you should use is a different form of the dietary specifications; compendial reference standards ingredient and would require • Packaging and labels received to whenever possible, but if no microscopic and/or chemical analysis. determine that the materials meet compendial reference standard exists, Ginkgo extracts have no morphological specifications; and you should establish appropriately or anatomical features, and it is possible • Each batch of packaged and labeled characterized inhouse materials that extracts may include a number of dietary ingredients or dietary prepared from representative lots; chemical compounds at different ratios supplements to ensure that the label • Use of appropriate test method and concentrations that would require a specified in the master manufacturing validations. Test method validation different chemical test to assure the record has been applied. determines whether a newly-developed identity of the dietary ingredient. For example, a representative sample or existing test method is accurate, Botanical dietary ingredients that come is important to being able to have an precise, and specific for its intended from wild rather than cultivated sources adequate sample to detect purpose. We have discussed previously may grow among and be unintentionally contamination. Contamination may not the terms ‘‘accurate’’ and ‘‘precise.’’ harvested with ‘‘poisonous’’ plants; be distributed evenly throughout a Validation involves evaluating the test therefore, an identity test also would product and may not be detected method on multiple occasions or in need to show whether a botanical without a representative number of multiple test facilities. Official methods, dietary ingredient is adulterated with units. Determining the size of a such as AOAC International methods, another substance or a poisonous plant. representative sample is important are validated in collaborative studies To illustrate this point, a specification because the sample size must be large using several laboratories under may contain a simple identity test, and enough to meet your testing needs for identical conditions. The AOAC these tests may show whether a dietary specific types of components, dietary International methods that are validated

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in collaborative studies often are often Acceptance Criteria for with proposed § 111.125. Laboratory cited as ‘‘official validated methods.’’ If Biotechnological/Biological Products records are necessary to ensure you modify an officially validated (63 FR 31506, June 9, 1998); and compliance with established method, you should document the • Use of test methods in accordance specifications and to demonstrate reason for the modification and have with established criteria. Your process compliance with the CGMP and quality data to show that the modified method for performing test methods criteria control processes. produced results that are at least as must include sufficient detail, including Proposed § 111.60(c) would require accurate and reliable as the established the material you are testing, the purpose that you verify that the laboratory method for material being tested. of the test, and the test method. The testing methodologies are appropriate Further, you should have complete description of the test method criteria for their intended use. records of any testing and must include any reagents used and Proposed § 111.60(d) would require standardization of laboratory reference preparation instructions, apparatus that you identify and use the standards, reagents, and standard required, any instructions for preparing appropriate validated testing method to solutions that you use in your laboratory the sample to be tested, and instructions use for each established specification for operations. Proposed § 111.25(b)(1) for conducting the examination. For which testing is required to determine would require calibration of laboratory example, if you receive components of whether the specification is met. In instruments, apparatus, gauges, and plant origin from an outside source, other words, the proposal would recording devices. Validated methods your specifications must indicate that recognize that requiring that you have also exist in official compendia for you test those components to verify that testing methods is not sufficient alone; they are not contaminated with vitamins, minerals, and several you must also use those testing methods adulterants of vegetable origin and to botanicals, so you should use validated to prevent the adulteration of dietary determine that the microscopic methods whenever available. You may ingredients or dietary supplements. examination method is appropriate for use validated methods that can be found We invite comment on whether we use. Further, you may decide that the in official references, such as AOAC should require, in a final rule, written AOAC International Official Method International, USP and others. Other procedures for your laboratory 961.01 entitled ‘‘Adulterants in Spices’’ method validations are conducted using operations and should require that the is the appropriate analytical method to two or three laboratories or in a single person who performs the laboratory detect the contaminant which is a processes document, at the time of laboratory by repeating the same test method to detect adulterants of multiple times. Official and nonofficial vegetable origin in spices. Your test performance, that the laboratory method validations use similar methods criteria must specify the processes were performed. If comments performance parameters in conducting component, dietary ingredient, or assert that written procedures are method validations. If an official dietary supplement to be tested, and necessary, comments should include an validated method does not exist in an what specifically to test for, e.g., the explanation of why the requirement is official reference, the method you use identity of the component, dietary necessary to prevent adulteration may be validated by using multiple tests ingredient, or dietary supplement, or a including how such a requirement at your laboratory or multiple specific contaminant. The method would ensure the identity, purity, laboratories performing the same test to criteria must provide detailed quality, strength, and composition of the document that the intended use of the information about performing the dietary ingredient or dietary method is consistently fulfilled. You analysis (i.e., the reagent solutions supplement. Conversely, if comments must validate that the official or needed and their preparation, the type assert that written procedures are not nonofficial method works under your of microscope and other equipment necessary, comments should include an conditions of use in your setting. You required, preparing the sample, and explanation of why the requirement is also should conduct day-to-day examination instructions). The not necessary including how, in the validations of the method that you use, proposed rule would not require that absence of the requirement, one can whether it is an official validated you test for any specific substance and prevent adulteration and ensure the method or a less-formal validated would not require a specific test for a identity, purity, quality, strength, and method, under the conditions of use to substance, so you would be able to composition of the dietary ingredient or ensure that the method will provide the evaluate what the most appropriate test dietary supplement. Further, we seek information you need to ensure that would be for the component, dietary comment on whether any of the your dietary ingredient or dietary ingredient, or dietary supplement and to proposed requirements in this section supplement has the identity, purity, use the test methods that are suited to are not necessary to prevent quality, strength, and composition that your products and your manufacturing adulteration and to ensure the identity, it is supposed to have and is thus not needs. Your test methodology must be purity, quality, strength, and adulterated. Consistent, day-to-day test specific for the component, dietary composition of the dietary ingredient or recoveries for the reference material are ingredient, or dietary supplement and dietary supplement. If comments assert one indicator that the analytical method the specifications you have established. that certain provisions are not is working. There are at least two Proposed § 111.60(b)(2) and (b)(3) necessary, comments should include an references that describe test method would apply to documentation and explanation of why the requirement is validation performance parameters: (1) recordkeeping for your laboratory not necessary including how, in the Performance parameters for operations. Proposed § 111.60(b)(2) absence of the requirement, one can chromatographic methods are described would require the person who conducts prevent adulteration and ensure the in ‘‘Reviewer Guidance, Validation of the testing and examination to identity, purity, quality, strength, and Chromatographic Methods’’ (Center for document, at the time of performance, composition of the dietary ingredient or Drug Evaluation and Research, FDA, that they followed the laboratory dietary supplement. If comments agree November 1994) (Ref. 76); and (2) method and the testing and examination that the proposed requirements are International Conference on results. Proposed § 111.60(b)(3) would necessary for reasons other than those Harmonisation (ICH); Draft Guidance on require that you keep laboratory testing we have provided, the comments should Specifications: Test Procedures and and examination records in accordance so state and provide an explanation.

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7. What Requirements Apply to controls that protect against the or higher sanitary quality water is Manufacturing Operations? (Proposed potential for microorganism growth and necessary for a manufacturing § 111.65) the potential for contamination. This operation. Proposed § 111.65(c)(4) would require Proposed § 111.65 would require that would require that you conduct all that you perform chemical, you take all necessary precautions to operations in receiving, inspecting, microbiological, or other testing, as ensure that, during the manufacturing transporting, segregating, preparing, necessary, to prevent the use of operations, you do not create a source manufacturing, packaging, sorting, and contaminated components, dietary of possible contamination and that packing dietary ingredients and dietary ingredients, and dietary supplements. specifications are consistently achieved. supplements in accordance with You should consider identifying those Under proposed § 111.65(a), you must appropriate and established sanitation areas in the processing and production design or select equipment and procedures. Operations with poor areas where chemical, microbial, or processes to ensure that dietary sanitation in the production and other forms of contamination are most ingredient or dietary supplement processing environment can significantly increase the risk of likely to occur. Chemical, microbial, or specifications are consistently achieved. contaminating components, dietary other testing is necessary to identify Frequently, a computer or system of ingredients, or dietary supplements. areas where sanitation measures have computers may control many or all Pathogenic microorganisms may be not been adequate or where products stages of manufacturing operations such found on the floors and in the drains of may become adulterated. as mixing, producing tablets, and the processing area and on all contact Proposed § 111.65(c)(5) would require packaging. It is important that such surfaces. Without good sanitary that you sterilize, pasteurize, freeze, systems and equipment function as practices, any surface that comes in refrigerate, control hydrogen-ion expected to ensure that the dietary contact with components, dietary concentration (pH), control humidity, ingredient or dietary supplement ingredients, and dietary supplements control water activity, or use any other contains a homogenous mixture, a tablet could be a potential source of microbial effective means to remove, destroy, or that is neither too hard or too friable, contamination. Thus, using appropriate prevent the growth of microorganisms and that the packaging contains the sanitation procedures would provide and to prevent decomposition. The correct dietary ingredient or dietary conditions and controls to protect measures you decide to use to remove, supplement. Equipment used in dietary against potential contamination and destroy or prevent the growth of ingredient or dietary supplement microbial growth. microorganisms on or in your manufacture, packaging, and label Proposed § 111.65(c)(2) would require components, dietary ingredients, or operations must be, for example, of an that you wash or clean components that dietary supplements must be appropriate size and installed properly contain soil or other contaminants. This appropriate under the conditions of in order to produce an unadulterated is a basic sanitation procedure to protect manufacture, handling, and product. If not designed or installed against contamination and microbial distribution. Such measures are properly, the equipment can result in a growth. Raw agricultural materials and necessary to prevent their adulteration variety of problems. For example, a other components that contain soil or and misbranding. Microorganisms mixer for the blending of powdered other contaminants must be washed or include pathogenic bacteria that, if ingredients will not properly perform its cleaned as necessary. Water quality present would adulterate the product. In function if the blade is too small relative used for washing, rinsing, or conveying addition, decomposition may result in a to the size of the mixer or not properly raw agricultural materials must be change in the component, dietary placed inside of the mixer. Such a mixer adequate for its intended use, both at ingredient, or dietary supplement may produce an adulterated product the start and at the end of the processing strength; the consequence of not using because the dietary supplement, for operation, and should not contribute to the appropriate measure may be that the example, is not of uniform composition the contamination of such materials. dietary ingredient or dietary supplement and therefore would not be able to meet Proposed § 111.65(c)(3) would require no longer meets specifications, and the specifications for purity, quality, that you use water that meets the EPA’s thus, would be adulterated under strength, or composition in the final NPDW regulations or, where necessary, section 402(g) of the act and misbranded product. Thus, equipment design and higher sanitary quality and that under section 403 of the act. By selection is critical to ensure that you complies with all applicable Federal, including the phrase, ‘‘any other manufacture an unadulterated dietary State, and local regulations for water effective means,’’ we provide you with ingredient or dietary supplement. that is used in the manufacturing discretion to decide which measures to Proposed § 111.65(b) would require operation. If you reuse water that was use to destroy or prevent the growth of that you conduct all manufacturing used to remove soil or contaminants microorganisms and to prevent operations in accordance with adequate from components, the proposal would decomposition. sanitation principles. We discussed the require that the reused water be safe and Proposed § 111.65(c)(6) would require importance of having adequate of adequate sanitary quality so that it that you hold components, dietary sanitation earlier and related it to the does not become a source of ingredients, and dietary supplements use of sanitary practices for employees, contamination. Some manufacturing that can support the rapid growth of physical plant, and equipment. operations may require water of a higher microorganisms of public health Proposed § 111.65(c)(1) through sanitary quality than water that meets significance in a manner that prevents (c)(11) would require that you take all the NPDW regulations. For example, the them from becoming adulterated. the necessary precautions during the fluoride or chloride levels in water Proposed § 111.65(c)(7) would require manufacture of dietary ingredients and meeting the NPDW regulations may that you identify and hold any dietary supplements to prevent interfere with certain capsule or tablet components, dietary ingredients, and contamination of components, dietary operations and a higher quality water dietary supplements, that require a ingredients, and dietary supplements. such as distilled water may be material review and disposition Proposed § 111.65(c)(1) would require necessary. This proposed requirement decision, in a manner that protects the that you perform manufacturing allows the manufacturer discretion in components, dietary ingredients, and operations under conditions and determining whether NPDW regulations dietary supplements against

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contamination and mixups. A dietary stated that manufacturers typically are make a disposition decision in ingredient or dietary supplement under able to identify the particular piece of accordance with proposed § 111.35(i) this proposed rule would require a equipment that is the source of the for any component, dietary ingredient, material review and disposition metal contamination. or dietary supplement that fails to meet decision when the components, dietary We disagree with the comment. The specifications or that is, or may be, ingredients, or dietary supplements purpose behind proposed § 111.65(c)(9) adulterated. If the material review and deviate from specifications. As is to ensure that no metal or foreign disposition decision allows you to previously explained, the specifications material becomes a source of possible reprocess the component, dietary contamination and not to establish established as production and process ingredient, or dietary supplement, mechanisms to be used after controls under proposed subpart E of proposed § 111.65(d) would require that part 111, are regulatory specifications. contamination has or is suspected to you retest or reexamine it to ensure that Thus, a deviation from such a have occurred. We believe that the most specification means that the practical way to protect against the it meets specifications and is approved components, dietary ingredients, or inclusion of metal and foreign material by the quality control unit. dietary supplements may be is to require that you use effective The person who performs the material adulterated. Any component, dietary measures during the manufacturing review and disposition review required ingredient, or dietary supplement that operations. The source of metal in accordance with this section would may be adulterated must be segregated contamination is not limited to be required to document at the time of from such material that meets equipment and we previously performance the results of the material specifications so that it does not become emphasize the need to maintain review and disposition decision. In a source of contamination. The proposal equipment to prevent such accordance with § 111.50(d), such would require that you hold these contamination. Metal contamination documentation must be maintained components, dietary ingredients, and also may occur during harvesting of with the batch production record. dietary supplements in a manner that natural products and use of utensils protects against contamination and such as metal brushes. Therefore, We invite comment on whether we mixups. because we believe that it is not possible should require, in a final rule, that you Proposed § 111.65(c)(8) would require to identify and eliminate all possible establish and follow written procedures that you perform mechanical sources of metal contamination or to to implement the manufacturing manufacturing steps (such as cutting, determine when measures would be operations required in proposed sorting, inspecting, shredding, drying, necessary to eliminate such § 111.65. If comments assert that written grinding, blending, and sifting) by any contamination, proposed § 111.65(c)(9) procedures are necessary, comments effective means to protect the dietary would require that you use effective should include an explanation of why ingredients or dietary supplements measures to protect against the the requirement is necessary to prevent against contamination. Such steps must inclusion of metal and foreign material adulteration including how such a include consideration of cleaning and for all your manufacturing operations. requirement would ensure the identity, sanitizing contact surfaces, using Proposed § 111.65(c)(10) would purity, quality, strength, and temperature controls, and using time require that you segregate and identify composition of the dietary ingredient or all containers for a specific batch of controls. For example, when blending dietary supplement. Conversely, if components, if you use a mixer that has dietary ingredients or dietary comments assert that written procedures not been cleaned and sanitized, your supplements to identify their contents are not necessary, comments should blended material may become and, where necessary, the phase of contaminated with microorganisms, manufacturing. This proposed include an explanation of why the including microbial pathogens. Thus, it requirement is intended to protect requirement is not necessary including is important to clean and sanitize your ingredients or dietary supplements from how, in the absence of the requirement, mixer before use. potential contamination or misuse one can prevent adulteration and ensure Proposed § 111.65(c)(9) would require during manufacturing or storage. the identity, purity, quality, strength, that you use effective measures, such as Identifications of these items will enable and composition of the dietary filters, traps, magnets, or electronic you to determine accurately the status of ingredient or dietary supplement. metal detectors, to protect against the all batches of dietary ingredients or Further, we seek comment on whether inclusion of metal or other foreign dietary supplements during all stages of any of the proposed requirements in this material in your components, dietary the manufacturing process, will help to section are not necessary to prevent ingredients, or dietary supplements. prevent mixups in the addition of adulteration and to ensure the identity, This proposed requirement is intended components or dietary ingredients to the purity, quality, strength, and to exclude foreign and extraneous dietary supplement and will facilitate composition of the dietary ingredient or matter that would contaminate prompt action if any problems in dietary supplement. If comments assert components, dietary ingredients, or processing are identified. that certain provisions are not dietary supplements. The purpose of Proposed § 111.65(c)(11) would necessary, comments should include an this proposed requirement is not to require that you identify all processing explanation of why the requirement is exclude dietary ingredients that are lines and major equipment used during not necessary including how, in the intended to be used and that are of manufacturing and to indicate their absence of the requirement, one can mineral origin. contents, including the name of the One comment to the ANPRM dietary ingredient or dietary supplement prevent adulteration and ensure the suggested that we require the use of and the specific batch or lot number identity, purity, quality, strength, and effective measures to protect against the and, when necessary, the phase of composition of the dietary ingredient or inclusion of metal or other extraneous manufacturing. The same reasons given dietary supplement. If comments agree material in dietary products when there for proposed § 111.65(c)(10) apply to that the proposed requirements are is reason to suspect that the product is this proposed requirement. necessary for reasons other than those contaminated by metal or other Proposed § 111.65(d) would require we have provided, the comments should extraneous material. The comment that you conduct a material review and so state and provide an explanation.

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8. What Requirements Apply to equipment can help you avoid some • Identifying, by any effective means, Packaging and Label Operations? common mistakes that can adulterate filled dietary ingredient or dietary (Proposed § 111.70) your products. For example, in one case, supplement containers that are set aside Proposed § 111.70 would establish a consumer complained about receiving and held in unlabeled condition for requirements for your packaging and two different sized capsules in a bottle future label operations, to prevent label operations. The correct use of labeled as containing acidophilus mixups; • Identifying the dietary ingredient or packaging and labels can affect whether capsules. We conducted an dietary supplement with a batch, lot, or your product is adulterated. For investigation and found that the control number that can be used to example, if a packaging material, manufacturer had received a similar determine the manufacturing history intended only for use with a dry report from a different consumer (Ref. and control of the batch. Using a unique product, is used to package a liquid, 77). We analyzed the capsules and identifier for each batch or lot is unsafe substances could migrate from found that the smaller capsules were not necessary for you to trace the the packaging to the liquid, and acidophilus capsules but contained levels of stannous fluoride that would manufacturing history for a particular adulterate your dietary ingredients or batch, and thus help you investigate and dietary supplements. In addition, if you cause convulsions in certain persons and even exceeded the lethal dose in correct any safety problems for a batch apply the wrong label, your product or to recall a dietary ingredient or would be adulterated under section small children. We also collected unopened bottles of the acidophilus dietary supplement batch. For example, 402(g) of the act because your label must if you discovered a particular batch had be that which is specified in the master product and, after opening the product, found different sized capsules. The a safety problem, you could recall the manufacturing record. In addition, your batch by identifying the batch number product would be misbranded under presence of smaller capsules containing stannous fluoride mixed in with the for the problem product. If you did not section 403 of the act. have a unique identifier, consumers Proposed § 111.70(a) would require larger acidophilus capsules adulterated the product. The fact that these small would be unable to determine which that you take necessary actions to product was the subject of a recall, and ensure each packaging container for stannous fluroride capsules mixed in with the larger acidophilus capsules they may not stop using the product or holding dietary ingredients or dietary you will have to recall more of the supplements meets its specifications so indicated that the manufacturer had not cleaned the filling equipment properly. product. that the packaging container’s condition • Examining a representative sample In another case, consumer complaints will not contaminate your dietary of the packaged and labeled dietary about a vitamin C product prompted us ingredients or dietary supplements or ingredient or dietary supplement to and the product’s manufacturer to cause them to deteriorate. As previously ensure that it meets specifications and investigate the product (Ref. 78). We stated in the discussion of proposed that the label specified in the master both discovered that the products § 111.35(e)(4), you must establish manufacturing record has been applied; contained niacin instead of vitamin C, specifications for packaging materials and that may come in contact with dietary and the problem was the result of a • Suitably disposing of labels and ingredients or dietary supplements. failure to clean out the packaging other packaging for dietary ingredients Meeting such specifications would equipment so that niacin that had been or dietary supplements that are obsolete ensure that the packaging that is used is left in the packaging equipment was put or incorrect to ensure that they are not safe and suitable for the intended use into the capsules during the used in any future packaging and label and meets all of the statutory and manufacturing operation for the vitamin operations. The use of any obsolete or regulatory requirements under the act. C product. The manufacturer reviewed incorrect label would adulterate the In that way, the packaging materials will its packing operations and instructed its product because it would not comply not adulterate the dietary ingredient or personnel at the manufacturing plant to with the requirement that the correct dietary supplement. This proposed prevent this problem from reoccurring. label as specified in the master • requirement would give you the Protecting manufactured dietary manufacturing record be used. discretion to establish the specifications ingredients and dietary supplements Proposed § 111.70(c) would require for each packaging container, and would from contamination, particularly that you conduct a material review and require that these specifications are airborne particulates such as dust, dirt, make a disposition decision of any routinely met. For example, if your or microbes that may contaminate your packaged and labeled dietary product is sensitive to light, you would product when your product is exposed ingredients or dietary supplements that choose a container that protects the to the environment. do not meet specifications. If packaged product from the light so that it does not • Using sanitary handling procedures. and labeled dietary ingredients or deteriorate. • Establishing physical or spatial dietary supplements do not meet Proposed § 111.70(b) would require separation of packaging and labels from specifications, it means that there is a that you fill, assemble, package, and operations on other dietary ingredients problem and that the dietary ingredient perform other related operations in a and dietary supplements to prevent or dietary supplement may be or is way that protects your dietary mixups. It is important to keep adulterated and this step is needed to ingredients or dietary supplements inprocess material separate from determine what to do and how to against adulteration and misbranding. finished product that is ready to be handle the product to ensure that it does The proposal would require that you packaged and labeled so that inprocess not get distributed. use any effective means to do this, material is not inadvertently packaged Sometimes problems arise because a which would include: and labeled as finished product. In manufacturer used the wrong label on a • Cleaning and sanitizing all filling addition, this proposed requirement particular ingredient. For example, in and packaging equipment, utensils, and would prevent mixup of one type of one case, an ingredient manufacturer dietary ingredient or dietary supplement dietary ingredient with another type of put the wrong label on its product so containers, as appropriate. This is dietary ingredient during packaging and that a product labeled as containing zinc important because cleaning and label operations such as the vitamin C picolinate actually contained zinc sanitizing all filling and packaging and niacin mixup described earlier. polynicotinate (Ref. 79). The dietary

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ingredient went to another manufacturer As another example, controlling written procedures for packaging and who, believing that the product was access of labels can help identify label operations that implement the zinc picolinate, used the dietary instances when mislabeling may have requirements of this section. If ingredient to make its dietary occurred. If you issue only the necessary comments assert that written procedures supplement. The error was discovered number of labels to cover a particular are necessary, comments should include after consumers who used the product production run but use fewer labels an explanation of why the requirement started complaining of adverse reactions than expected even though you labeled is necessary to prevent adulteration that are associated with niacin the expected number of containers for including how such a requirement supplements, but the problem could the production run, this discrepancy would ensure the identity, purity, have been avoided if the dietary would suggest that you used some quality, strength, and composition of the ingredient manufacturer had taken steps wrong labels during the run and that dietary ingredient or dietary to ensure that the correct labels were you should conduct an investigation to supplement. Conversely, if comments used. determine the cause of, or reconcile the assert that written procedures are not Proposed § 111.70(d) would require discrepancy. necessary, comments should include an that you repackage or relabel dietary Proposed § 111.70(f)(2) would require explanation of why the requirement is ingredients or dietary supplements if that you must examine carefully, before not necessary including how, in the approved and appropriately packaging operations, packaging and absence of the requirement, one can documented by your quality control labels for each batch of dietary prevent adulteration and ensure the unit. The quality control unit would ingredient or dietary supplement to identity, purity, quality, strength and need to decide whether the improperly ensure that the label and packaging composition of the dietary ingredient or packaged product was adulterated by conform to the master manufacturing dietary supplement. Further, we seek the incorrect package and could be record. comment on whether any of the repackaged and relabeled without Proposed § 111.70(g) would require proposed requirements in this section reprocessing of the dietary ingredient or that the person who performs the are not necessary to prevent dietary supplement. requirement established in accordance adulteration and to ensure the identity, Proposed § 111.70(e) would require with this section document, at the time purity, quality, strength, and that you retest or reexamine any of performance, that he or she composition of the dietary ingredient or repackaged or relabeled dietary performed the requirement. This would dietary supplement. If comments assert ingredients or dietary supplements. include, but not be limited to, that certain provisions are not They must meet all specifications and documentation in the batch production necessary, comments should include an the quality control unit must approve or record of: explanation of why the requirement is reject their release for distribution. The • The identity and quantity of the not necessary including how, in the reason this is necessary is to ensure for packaging and labels used and absence of the requirement, one can example, by testing or examination, that reconciliation of any discrepancies prevent adulteration and ensure the the repackaged or relabeled product between issuance and use; identity, purity, quality, strength, and meets specifications and that the • The examination of a representative composition of the dietary ingredient or container in which the product is sample (as proposed § 111.70(b)(7) dietary supplement. If comments agree repackaged meets specifications. would require); that the proposed requirements are • Proposed § 111.70(f)(1) would require The conclusions you reached from necessary for reasons other than those that you control the issuance and use of retests conducted under proposed we have provided, the comments should packaging and labels and reconcile the § 111.70(e); and so state and provide an explanation. issuance and use of discrepancies. It is • Any material reviews and important to control access to the disposition decisions for packaging and 9. What Requirements Apply to Rejected storage of packaging and labels; for labels. Components, Dietary Ingredients, example, only the labels that are Proposed § 111.70(h) would require Dietary Supplements, Packaging, and required for current label operations that you keep the packaging and label Labels? (Proposed § 111.74) should be issued to prevent issuance of operations records required under this Proposed § 111.74 is intended to any incorrect labels during the label section established in accordance with ensure that you do not mistakenly use operation. Using batch or lot numbers proposed § 111.125. These records are rejected materials that are determined on your labels may be one control necessary to ensure that the correct by the quality control unit to be method. Batch or lot numbers also help packaging and label, i.e., the packaging unsuitable for use to make a dietary you (and us) to identify a particular and label specified by the master ingredient or dietary supplement. product and to trace that product’s manufacturing record, were used in and Proposed § 111.74(a) would require manufacturing history through your applied to the batch of dietary that you clearly identify, hold, and CGMP records. They can help identify ingredient or dietary supplement. These control, under a quarantine system any which products are affected by a records together with the master component, dietary ingredient, dietary product recall, if a recall is necessary, manufacturing records and batch supplement, packaging, and label that is and this can help preserve consumer production records will ensure that a rejected and unsuitable for use in confidence in your product. complete history of each batch of manufacturing, packaging, or label For example, if a recall covers batch dietary ingredient or dietary supplement operations. The term ‘‘control under a A123, and a particular consumer has a including use of the correct packaging quarantine system’’ indicates that you product whose batch number is C456, and label is available for your review in must prevent the use of any rejected he or she will know that the product is the event that a problem arises with a component, dietary ingredient, dietary not covered by the recall. In contrast, if particular batch. These records also are supplement, packaging, or label because no batch numbers appear on the product necessary to demonstrate compliance such rejected product is unsuitable for label, the consumer would not be able with the CGMP and quality control use. For example, under this proposed to tell whether his or her product is procedures. We invite comment on rule, if a component, dietary ingredient, covered by the recall and may continue whether we should require, in a final or dietary supplement is rejected and to use it. rule, that you establish and follow determined by the quality control unit

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to be unsuitable for use, such material the components, dietary ingredients, or explanation of why the requirement is would be adulterated and not be dietary supplements. For example, dried necessary to prevent adulteration suitable for reprocessing. Therefore, to plants stored in a hot, humid warehouse including how such a requirement prevent contamination of nonrejected may become moldy. Mold would ensure the identity, purity, material, you must quarantine the contamination could adversely affect quality, strength, and composition of the rejected material before disposal. The the purity of the dietary ingredients and dietary ingredient or dietary proposed rule would not specify any dietary supplements you manufacturer. supplement. Conversely, if comments particular mechanism for how you You will decrease the chances of mold assert that written procedures are not quarantine the material, instead, you contaminating your dried plants if you necessary, comments should include an control temperature and humidity. would have discretion in deciding what explanation of why the requirement is Proposed § 111.80(b) would require actions to take or what process to use. not necessary including how, in the You also should note that, by referring that you hold packaging and labels absence of the requirement, one can to items that are rejected and unsuitable under appropriate conditions of prevent adulteration and ensure the for use, proposed § 111.74(a) excludes temperature, humidity, and light so that items that can be reprocessed and made the quality of the packaging and labels identity, purity, quality, strength, and suitable for use. Those items that can be are not affected. For example, some composition of the dietary ingredient or reprocessed and made suitable for use plastics become brittle when exposed to dietary supplement. are dealt with in proposed § 111.82. extreme temperatures. If brittle plastic 2. What Requirements Apply to Holding containers are used to hold dietary Inprocess Material? (Proposed § 111.82) F. Holding and Distributing (Proposed ingredients or dietary supplements, they Subpart F) could crack or break, thereby losing Proposed § 111.82 discusses proposed 1. What Requirements Apply to Holding their protective qualities, and lead to requirements for holding inprocess Components, Dietary Ingredients, contamination or deterioration of the material. Proposed § 111.82 would Dietary Supplements, Packaging, and dietary ingredient or dietary require that you segregate any inprocess Labels? (Proposed § 111.80) supplement. You need to know the material that does not meet your conditions of temperature, humidity, specifications, is awaiting further Proposed § 111.80 would require that and light that are appropriate for your processing, or needs further evaluation you hold dietary ingredients and dietary packaging and labels and you need to by the quality control unit (e.g., because supplements under conditions that will hold the packaging and labels under protect them against contamination and such conditions. the inprocess material does not meet deterioration. Proposed § 111.80(a) Proposed § 111.80(c) would require specifications, or because of an would require that you hold that you hold components, dietary unexpected occurrence) to determine if components, dietary ingredients, and ingredients, dietary supplements, it is suitable for reprocessing. dietary supplements under appropriate packaging, and labels under conditions Proposed § 111.82(a), therefore, would conditions of temperature, humidity, that do not lead to mixup, require that you identify and hold and light so that the identity, purity, contamination, or deterioration of the inprocess material under conditions that quality, strength, and composition of the components, dietary ingredients, dietary will protect such material against components, dietary ingredients, and supplements, packaging, and labels. For mixup, contamination, and dietary supplements are not affected. example, your holding conditions must deterioration. This proposed provision includes the include a system for identifying holding of components, dietary container contents and its status (e.g., Proposed § 111.82(b) would require ingredients, dietary supplements in segregated, approved for use) in a that you hold inprocess material under your physical plant and at any point in manner that prevents mixup or use of appropriate conditions of temperature, the distribution process, however, we unsuitable materials in manufacturing. humidity, and light. The intent here is would not extend the holding Further, the presence of rodents in your to prevent any contamination or requirements under this proposed holding area may cause contamination deterioration of that inprocess material. CGMP regulation to retail or deterioration of components, dietary We invite comment on whether we establishments, but would defer to State ingredients, dietary supplements, should require, in a final rule, that you and local governments for regulating packaging, and labels. Therefore, your establish and follow written procedures operations that provide dietary holding conditions must be rodent-free. for holding inprocess material. If supplements to retail for sale to the Moreover, rodents in your holding area comments assert that written procedures consumer. However, if a retail holding would adulterate your dietary are necessary, comments should include area is filthy, we would not be ingredient or dietary supplement under an explanation of why the requirement prevented from taking an enforcement section 402(g) of the act. Holding is necessary to prevent adulteration action under a legal authority other than conditions that prevent mixup, including how such a requirement section 402(g) of the act. contamination, or deterioration of would ensure the identity, purity, This requirement would ensure that components, dietary ingredients, dietary products are not contaminated while supplements, packaging, or labels are quality, strength, and composition of the they are held by the manufacturer, the necessary to prevent the production of dietary ingredient or dietary wholesaler, or while being held at a an adulterated dietary ingredient or supplement. Conversely, if comments warehouse. This would increase the dietary supplement. assert that written procedures are not likelihood that the products consumers We invite comment on whether we necessary, comments should include an purchase have the same quality as when should require, in a final rule, that you explanation of why the requirement is they left the manufacturer. Note that establish and follow written procedures not necessary including how, in the proposed § 111.80(a) uses the words for holding components, dietary absence of the requirement, one can ‘‘not affected;’’ this means that the ingredients, dietary supplements, prevent adulteration and ensure the conditions under which you hold packaging, and labels. If comments identity, purity, quality, strength, and components, dietary ingredients, and assert that written procedures are composition of the dietary ingredient or dietary supplements must not adulterate necessary, comments should include an dietary supplement.

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3. What Requirements Apply to Holding dietary supplement to show that it is your manufacturing processes and those Reserve Samples of Components, ‘‘returned.’’ We would require that you other batches if the reason for a dietary Dietary Ingredients, and Dietary identify and quarantine (not just ingredient or a dietary supplement Supplements? (Proposed § 111.83) identify and segregate) returned dietary being returned implicates other batches. Earlier, we discussed a provision ingredients or dietary supplements so The point of the investigation would be concerning the collection of reserve that they cannot be used. We propose to to determine whether, for example, the samples. Proposed § 111.50(h) would require that you quarantine returned other implicated batches may have the require that you collect representative products because you must assume that same problem or have been subject to the returned product is adulterated until the same problematic manufacturing reserve samples of each batch of dietary tests show otherwise. Thus, the product process for which the dietary ingredient ingredient or dietary supplement. should not have physical closeness or or dietary supplement was returned. Proposed § 111.83 would set forth contact with nonreturned product to Other batches may be implicated if the requirements for holding any reserve ensure that it will not be mixed up component or dietary ingredient used in samples collected. mistakenly with nonreturned product, Proposed § 111.83(a) would require the returned product also was used in redistributed or reused in that you hold any reserve samples of additional batches or if your manufacturing. investigation indicates that there was a components or dietary ingredients Proposed § 111.85(b)(1) states that you collected in a manner that protects problem with a step in the may salvage returned dietary manufacturing process that affected against contamination and deterioration. ingredients and dietary supplements Proposed § 111.83(b) would require additional batches. The proposal also only if: would require that you document the that you hold such reserve samples of • Evidence from their packaging (or, investigation and include your dietary supplements in a manner that if possible, an inspection of the protects against contamination and conclusions and followup. premises where the dietary ingredients Proposed § 111.85(e) would require deterioration. Further, this provision and dietary supplements were held) you to establish and keep records for would require that you hold the reserve indicates that the dietary ingredients any material review and disposition samples under conditions of use and dietary supplements were not decision and any required testing to recommended or suggested in the label subjected to improper storage determine compliance with of the dietary supplement and, if no conditions. This would require that you specifications done for any returned conditions of use are recommended or have personal knowledge of the exact dietary ingredient or dietary suggested in the label, then under conditions under which the returned supplement. You should include the ordinary conditions of use. This dietary ingredients or dietary following information in your records: proposed requirement also would supplements were held. Normally, for • The name of the person or company require that you use the same container- most types of packaging, simply or both the name of the person and closure system in which the dietary examining the packaging will not tell company who returned the dietary supplement is marketed or one that you about the storage conditions that ingredients or dietary supplements; provides the same level of protection existed. However, we are aware of some • A description of the returned against contamination or deterioration technologies that are being used, such as dietary ingredient or dietary as the marketed container-closure temperature-sensitive materials that supplement; system. It is necessary to hold the change colors, that could provide some • The batch or lot number of the reserve sample of a dietary supplement information about storage conditions; returned dietary ingredient or dietary under the same conditions and in the and supplement and any reprocessed batch same packaging as you would expect a • Tests demonstrate that the dietary or batch manufactured using the consumer to hold that dietary ingredients or dietary supplements meet returned dietary ingredient or dietary supplement so that, if you need to later all specifications for identity, purity, supplement; test that reserve sample, the testing quality, strength, and composition. This • The reason for the return; would reflect current conditions under requirement will ensure that you do not • The quantity returned; which the dietary supplement is held by return to distribution a dietary • The disposition of the dietary the consumer prior to being consumed. ingredient or dietary supplement that ingredient or dietary supplement; and • The date of disposition. 4. What Requirements Apply to does not meet specifications. Salvage is available for only those products for Proposed § 111.85(f) would require Returned Dietary Ingredients or Dietary that you make and keep records for Supplements? (Proposed § 111.85) which testing can be performed on finished product. returned dietary ingredients and dietary Proposed § 111.85 would establish For purposes of this discussion, supplements in accordance with requirements for returned dietary ‘‘salvage’’ means to return to § 111.125. These records are necessary ingredients or dietary supplements. distribution without reprocessing the to ensure that returned products that ‘‘Returned’’ dietary ingredients or dietary ingredient or dietary could be adulterated are not dietary supplements are those products supplement. inadvertently redistributed or that a distributor, wholesaler, or retailer Proposed § 111.85(c) would require inadvertently used in manufacturing. returns to a manufacturer. Proposed that you destroy or suitably dispose of Further, records of any reprocessed § 111.85(a) would require that you the returned dietary ingredients or batch or batch manufactured using the identify returned dietary ingredients or dietary supplements if they do not meet returned product will be useful in the dietary supplements and to quarantine specifications for identity, purity, event that a problem arises with a them until your quality control unit quality, strength, and composition, particular batch that is manufactured conducts a material review and makes a unless the quality control unit conducts with returned product. These records disposition decision. (Your quality a material review and makes a also are necessary to demonstrate control unit would do this under disposition decision to allow compliance with the CGMP and quality proposed § 111.37.) For example, you reprocessing. control procedures. We invite comment could attach a tag or other identifier on Proposed § 111.85(d) would require on whether we should require, in a final the returned dietary ingredient or that you conduct an investigation of rule, that you establish and follow

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written procedures for identifying, dietary supplements should take steps determine whether an investigation of quarantining, and salvaging returned to ensure that their shipments are the complaint is necessary. dietary ingredients and dietary obtained from manufacturers that follow Proposed § 111.95(a) would require supplements. If comments assert that these proposed CGMP requirements. that you have a qualified person review written procedures are necessary, In addition, these proposed CGMPs all consumer complaints to determine comments should include an would apply to manufacturers who whether the consumer complaint explanation of why the requirement is export their dietary ingredient or dietary involves a possible failure of a dietary necessary to prevent adulteration supplement, unless exported in ingredient or dietary supplement to including how such a requirement compliance with section 801(e) of the meet any of its specifications, or any would ensure the identity, purity, act. Section 801(e)(1) of the act states other requirements of this part, quality, strength, and composition of the that a food intended for export must not including those specifications and other dietary ingredient or dietary be deemed to be adulterated or requirements that, if not met, may result supplement. Conversely, if comments misbranded under the act if it: in a possible risk of illness or injury. A assert that written procedures are not • Accords to the foreign purchaser’s ‘‘qualified person’’ would be a person necessary, comments should include an specifications; who has the training and experience to explanation of why the requirement is • Is not in conflict with the laws of determine whether a complaint not necessary including how, in the the country to which it is intended for represents a possible failure of a dietary absence of the requirement, one can export; ingredient or dietary supplement to prevent adulteration and ensure the • Is labeled on the outside of the meet any of the requirements in this identity, purity, quality, strength, and shipping package that it is intended for part, or represents a possible risk of composition of the dietary ingredient or export; and illness or injury that is unrelated to such dietary supplement. • Is not sold or offered for sale in failure. The qualified person’s review is domestic commerce. important for distinguishing between 5. What Requirements Apply to Dietary ingredients and dietary those consumer complaints that your Distributing Dietary Ingredients or supplements for export are subject to quality control unit must review and Dietary Supplements? (Proposed section 801(e)(1) of the act and would be those consumer complaints that § 111.90) subject to the notification and represent a consumer’s dissatisfaction Proposed § 111.90 would establish recordkeeping requirements of § 1.101 with a dietary ingredient or dietary requirements concerning the (21 CFR 1.101) and you would be supplement that is unrelated to a distribution of dietary ingredients and required to comply with the export possible failure to meet specifications dietary supplements. Proposed requirements of § 1.101. that would be required by this proposal, § 111.90(a) would require any We invite comment on whether we or any other requirement in this part. distribution of dietary ingredients or should require, in a final rule, that you For example, some consumer dietary supplements to be under make and keep records on the complaints about quality may simply conditions that will protect them from distribution of dietary ingredients and express a personal dislike of the taste, contamination and deterioration. This is dietary supplements that you color, odor, or size of tablet, which to protect dietary ingredients and manufacture, package, or hold. would probably not require your quality dietary supplements from distribution G. Consumer Complaints—What control unit to review them. As stated practices that may adulterate them. Requirements Apply to Consumer earlier, consumer complaints related to As discussed previously, proposed an illness or injury related to a part 111 also would apply to foreign Complaints? (Proposed Subpart G, § 111.95) pharmacologically active substance of a firms that manufacture, package, or hold particular dietary ingredient, such as dietary ingredients and dietary Proposed § 111.95 would establish aristolochic acid, would not be a supplements that are imported or requirements for receiving and handling consumer complaint within the offered for import into the United consumer complaints. Consumer meaning of that term in this proposal States, unless imported for further complaints can be helpful in alerting and thus would not be of the type that processing and export under section you to possible manufacturing and the quality control unit must review 801(d)(3) of the act. It also would apply safety problems associated with your under this proposed rule. to persons who distribute imported dietary ingredients or dietary Proposed § 111.95(b) would require dietary ingredients and dietary supplements. that your quality control unit review all supplements, and to persons who export As stated in § 111.3, consumer consumer complaints involving the dietary ingredients and dietary complaint refers to a possible failure of possible failure of a dietary ingredient supplements from the United States a dietary ingredient or dietary or dietary supplement to meet any of its unless exported in compliance with supplement to meet any of the specifications, or any of the other section 801(e) of the act. requirements of this part, including requirements in this part, including We recognize that the safety of dietary those that, if not met, may result in a those specifications and other supplements cannot be adequately possible risk of illness or injury. requirements that, if not met, may result ensured if the imports are not subject to Proposed § 111.95(e) would require that in a possible risk of illness or injury, to the same controls as domestic products. you keep a written record of every determine whether there is a need to In addition, we believe that the importer consumer complaint that is related to investigate the consumer complaint. who distributes a foreign product good manufacturing practices. Thus, When there is a reasonable possibility of should share responsibility with the whether the complaint was sent by a relationship between the quality of a foreign manufacturer for safety. More regular mail, electronic mail, or any dietary supplement and an adverse often than not, it is a U.S. importer, other form of written communication, or event, such as a report of an illness or rather than the foreign manufacturer, whether received orally, you would be injury that may be due to a wrong who actually distributes imported required to keep a written record of each ingredient or wrong label, then the dietary supplements for sale in the consumer complaint. You should manufacturer would be required to do United States. Thus, we believe that include all information that would an investigation that includes both importers of dietary ingredients or allow your quality control unit to batch records associated with the

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dietary ingredient or dietary supplement health. However, a consumer complaint complaint because the manufacturer involved in the consumer complaint. does not include an adverse event, may not be aware of possible problems However, if the quality control unit illness, or injury related to the safety of associated with its products. determines that an investigation is a particular dietary ingredient Proposed § 111.95(f) addresses unnecessary, it would be helpful to you independent of whether the product is documentation and recordkeeping. if your quality control unit documents produced under good manufacturing Consumer complaints can alert you (and why an investigation was not necessary. practices. The consumer complaint us) to potential quality problems with a This information would be useful to you written record must include, but is not product that is related to good because it could save time if you receive limited to, the following: manufacturing practices, such as cases additional similar consumer complaints • The name and description of the where the manufacturer used the wrong about a particular product. dietary ingredient or dietary ingredient or put the wrong label on a Proposed § 111.95(c) would require supplement; product. A prudent manufacturer, that your quality control unit investigate • The batch or lot number of the therefore, must investigate any a consumer complaint when there is a dietary supplement, if available; complaints regarding its products reasonable possibility of a relationship • The complainant’s name, if because the results of its investigations between the quality of a dietary available; might lead to solutions or improvements supplement and an adverse event. For • The nature of the complaint, that will make the product or example, if a manufacturer uses too including how the consumer used the manufacturing process better and much of a dietary ingredient in a dietary product; benefit the manufacturer and • supplement (e.g., 400 to 4,699 µg of The reply to the complainant, if consumers. µ any; and Proposed § 111.95(f)(1) would require selenium instead of 200 g of selenium), • it is a manufacturing error that may Findings of the investigation and the person who performs the result in an adverse event. Further, if a followup action taken when an requirement established in accordance communication alleges consumer investigation is performed. with this section to document, at the dizziness, vomiting, or lightheadedness We suggest that you report the time of performance, that he or she after consuming several dietary consumer complaint and the performed the requirement. supplements, it is a adverse event report investigation results to us when there is Finally, proposed § 111.95(f)(2) would that is worthy of quality control unit a possibility of a relationship between require that you keep consumer investigation. the consumption of a dietary complaint records established in Proposed § 111.95(d) would describe supplement and a serious adverse event. accordance with proposed § 111.125. what the quality control unit’s While the proposal would not require These records are necessary for investigation must include. In brief, the that you submit these reports, we handling consumer complaints in a quality control unit’s investigation of a strongly suggest that you do so because manner that ensures that an consumer complaint must include the we may have additional expertise or unanticipated problem with a dietary batch records associated with the data that may be helpful in investigating ingredient or dietary supplement is dietary ingredient or dietary supplement the complaint or determining whether reviewed and investigated. These involved in the consumer complaint. the problem applies to more than one records also are necessary to The quality control unit must extend the product. We suggest that you submit demonstrate compliance with the investigation to other batches of dietary these reports within 15 days after you CGMP. ingredients or dietary supplements that receive such information to the FDA We invite comment on whether we may have been associated with a failure MedWatch program by calling our should require, in a final rule, that you to meet a specification or any other ‘‘MedWatch’’ program (our database for establish and follow a written procedure requirements of this part. When there is reporting possible adverse events) at 1– for receiving, reviewing, and a possible product defect or failure, we 800–FDA–1088 (1–800–332–1088) to investigating consumer complaints. If recommend that the investigation request that a reporting form (one-page, comments assert that written procedures include laboratory testing of the dietary return postage paid) and instructions on are necessary, comments should include ingredient or dietary supplement how to complete the form be mailed to an explanation of why the requirement because you will need the test results to you, downloading a form and is necessary to prevent adulteration determine if specifications or instructions from the MedWatch including how such a requirement requirements for the dietary ingredient Internet site at http://www.fda.gov, or would ensure the identity, purity, or dietary supplement were not met. using the interactive form available on quality, strength, and composition of the Complaints such as those that involve the MedWatch Internet site at http:// dietary ingredient or dietary serious adverse events should include www.fda.gov. supplement. Conversely, if comments followup by a health care provider. For Further, we suggest that you report a assert that written procedures are not other types of complaints, neither consumer complaint even if you are not necessary, comments should include an laboratory nor medical investigation the manufacturer of a dietary ingredient explanation of why the requirement is may be necessary because the product or dietary supplement and only package not necessary including how, in the defect or failure may be identified by or distribute a dietary ingredient or absence of the requirement, one can reviewing batch documents or the dietary supplement if you receive a prevent adulteration and ensure the consumer complaint may not involve a consumer complaint that may be related identity, purity, quality, strength, and serious adverse event. to the manufacture of the dietary composition of the dietary ingredient or Proposed § 111.95(e) would require ingredient or dietary supplement. dietary supplement. that you make and keep a written record Sometimes consumers submit of every consumer complaint that is complaints to the person who H. Records and Recordkeeping—What related to good manufacturing practices. distributes a product or the person who Requirements Apply to Recordkeeping? For the purposes of this regulation, a is listed on the package label. If this (Proposed Subpart H, § 111.125) consumer complaint about product happens, you should notify the Throughout this discussion of the quality may or may not include manufacturer of the dietary ingredient proposed rule, some provisions have concerns about a possible hazard to or dietary supplement of the consumer included a paragraph that would require

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that you keep records established in • Sections as questions and answers ‘‘prescribe good manufacturing practices accordance with proposed § 111.125. to focus sections better; and for dietary supplements.’’ Other relevant Proposed § 111.125 would establish • Personal pronouns to reduce legal authority is discussed in section II general recordkeeping requirements and passive voice and draw readers into the of this document. tell you how long you must keep certain text. For this proposed CGMP rule for records. As we have stated several times In some cases, we modeled a dietary ingredients and dietary in this document, we determine CGMP proposed provision after an existing supplements, recordkeeping is compliance by conducting inspections. regulation, but wrote the proposed rule necessary to provide the type of Records, therefore, enable you to show, using plain language techniques. We documentation that would demonstrate and for us to determine, how you invite the public to comment on the that dietary ingredients and dietary complied with the CGMP requirements. plain language techniques used in this supplements are manufactured, Proposed § 111.125(a) would apply to proposed rule. In developing your packaged, and held under the all records covered by the proposed rule comments, please consider addressing conditions that would be required under and would require that you keep those the following points: the proposed CGMP regulations. Under • Do you like the proposed rule’s records for 3 years beyond the date of section 701(a) of the act, we may issue manufacture of the last batch of dietary appearance? • Do plain language techniques make regulations necessary for the efficient ingredients or dietary supplements the document easier to read and enforcement of the act. If you did not associated with those records. Retention understand? and keep records, for example, documenting for 3 years beyond the date of • Do you have other suggestions to practices performed during previous manufacture would be appropriate for improve the format? production runs, it would be difficult followup of consumer complaints for us to determine whether, as stated received during the marketing period. V. Paperwork Reduction Act of 1995 under section 402(g)(1) of the act, the Proposed § 111.125(b) would deal This proposed rule contains dietary supplement had been with the form in which you keep information collection requirements that manufactured, packaged, and held records. The proposal would allow you are subject to review by the Office of under CGMPs. By requiring records, we to keep records required under this part Management and Budget (OMB) under will be able to ensure that you follow as original records, as true copies (such the Paperwork Reduction Act of 1995 CGMPs and that your dietary as photocopies, microfilm, microfiche, (44 U.S.C. 3501–3520). A description of supplements are not adulterated and or other accurate reproductions of the these requirements is given below with misbranded during manufacturing, original records), or as electronic an estimate of the annual recordkeeping packaging, or holding operations. records. If you use reduction burden. Included in the estimate is the The proposed rule would establish techniques, such as microfilming, the time for reviewing instructions, the minimum manufacturing practices proposal would require that you make searching existing data sources, necessary to ensure that dietary suitable reader and photocopying gathering and maintaining the data supplements are manufactured, equipment readily available to us. If you needed, and completing and reviewing packaged, or held in a manner that will use electronic records, the proposal each collection of information. not adulterate and misbrand the dietary would require that you comply with We invite comments on: (1) Whether ingredients or dietary supplements. part 11 (our requirements for electronic the proposed collection of information The proposed regulations would records). is necessary for the proper performance impose requirements for: (1) Personnel, Proposed § 111.125(c) would require of our functions, including whether the (2) physical plants, (3) equipment and that you make your records available for information will have practical utility; utensils, (4) production and process inspection and copying by us when (2) the accuracy of our estimate of the controls, (5) holding and distributing, requested. We sometimes need to copy burden of the proposed collection of (6) consumer complaints, and (7) records when our field inspectors need information, including the validity of records and recordkeeping. guidance or additional expertise from the methodology and assumptions used; We are proposing recordkeeping our headquarters staff; if we were (3) ways to enhance the quality, utility, requirements that include records unable to copy records, our inspections and clarity of the information to be pertaining to: (1) Calibration of would become more complicated and collected; and (4) ways to minimize the instruments and controls; (2) automatic, longer in duration, particularly if the burden of the collection of information mechanical, or electronic equipment inspection involved a complex scientific on respondents, including the use of calibration, inspection, or checks; (3) or technical issue that normally would automated collection techniques, when production and process controls; (4) be handled at FDA headquarters. appropriate, and other forms of quality control; (5) receiving IV. Statement Concerning the Use of information technology. Title: Current Good Manufacturing components, dietary supplements, Plain Language Practice in Recordkeeping and packaging, and labels; (6) master In response to the June 1, 1998, White Reporting for Dietary Ingredients and manufacturing and batch production; (7) House Presidential Memorandum on Dietary Supplements. packaging and label operations; (8) Plain Language, we drafted this Description: Section 402(g) of the act returned dietary ingredients or dietary proposed rule in plain language. Plain gives us explicit authority to issue a rule supplements; and (9) consumer language is intended to help readers regulating conditions for manufacturing, complaints. find requirements quickly and packaging, and holding dietary Description of Respondents: Dietary understand them easily. To do that, we supplements. Section 402(g)(1) of the ingredient manufacturers, dietary have reorganized sections modeled after act states that a dietary supplement is supplement manufacturers, packagers existing regulations and reworded the adulterated if ‘‘it has been prepared, and repackagers, distributors, paragraphs using: packed, or held under conditions that warehousers, exporters, importers, large • Short sections, paragraphs, do not meet current good manufacturing businesses, and small businesses. sentences, and words to speed up practice regulations.’’ Section 402(g)(2) We estimate the burden of this reading and enhance understanding; of the act authorizes us to, by regulation, collection of information as follows:

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TABLE 1.—ESTIMATED ANNUAL RECORDKEEPING BURDEN 1

Annual fre- 21 CFR Section Number of quency of Total annual Hours per Total hours recordkeepers recordkeeping records record

111.15(b)(3) ...... 231 12 2,772 0.1 277 111.15(d)(3) ...... 231 260 60,060 0.25 15,015 111.25(d) ...... 213 365 77,745 0.5 38,873 111.30(b)(2) and (b)(5) ...... 707 260 183,820 0.5 91,910 111.35(d) ...... 10 1 10 10 100 111.35(e) ...... 367 260 95,420 0.25 23,855 111.35(f) ...... 367 260 95,420 0.1 9,542 111.35(i)(1) ...... 367 10 3,670 0.25 918 111.35(j) ...... 367 260 95,420 .25 23,855 111.35(m) ...... 367 365 133,955 0.1 13,396 111.37(b)(1), (b)(3) through (b)(5), (b)(7) through (b)(10), and (b)(12)(i) ...... 286 260 74,360 0.5 37,180 111.37(c) ...... 286 365 104,390 0.5 52,195 111.40(a)(3), (a)(4), (b)(2), and (b)(3) ...... 449 365 163,885 0.1 16,389 111.40(c)(1) ...... 218 365 79,570 0.5 39,785 111.45(a) 2 and (b) 2 ...... 200 1 200 30 6,000 111.50(a) through (c), (d)(1), and (e) ...... 68 260 17,680 1 17,680 111.50(g) ...... 68 260 17,680 0.5 8,840 111.60(b)(2) ...... 133 365 48,545 1 48,545 111.60(d) 2 ...... 133 1 133 3 399 111.65(c)(7), (c)(10), and (c)(11) ...... 133 365 48,545 0.1 4,855 111.70(b)(5) through (b)(6), (d), and (e) ...... 245 260 63,700 0.1 6,370 111.70(g) ...... 245 260 63,700 0.50 31,850 111.74(a) ...... 200 12 2,400 0.1 240 111.82(a) ...... 53 52 2,756 0.1 276 111.85(a) ...... 53 260 13,780 0.1 1,378 111.85(d) and (e) ...... 53 260 13,780 0.5 6,890 111.95(e) ...... 53 75 3,975 0.1 398 111.95(f)(1) ...... 93 75 6,975 0.5 3,488 111.125 ...... 220 4 880 0.1 88

Total ...... 500,587 1 There are no capital costs or operating and maintenance costs associated with this collection of information. 2 One time burden.

The burden estimates above are based are performed and in recordkeeping. We would require that the batch production on our institutional experience with used an estimated annual batch records be prepared every time a batch CGMP requirements for drugs and on production of 260 batches per year to is manufactured and § 111.50(i) would data provided by Research Triangle estimate the burden of requirements that require that batch production records be Institute (RTI) in the ‘‘Survey of are related to the number of batches kept in accordance with proposed Manufacturing Practices in the Dietary produced annually, e.g., proposed § 111.125. The estimated burden for Supplement Industry’’ (Refs. E1 and E2). § 111.50, ‘‘What requirements apply to establishing the batch production We tentatively conclude that there are establishing a batch production record?’’ records is counted in proposed no capital costs or operating costs The estimate of 260 batches per year is § 111.50(a) and the estimated burden for associated with this proposed rule. near the midpoint of the number of keeping the batch production records as However, we invite comments on annual batches reported by RTI survey would be required in accordance with information provided in table 1 of this firms. § 111.50(i) is counted in proposed document or on any anticipated costs. Proposed § 111.125 prescribes the § 111.125. The estimates for number of firms length of time for which CGMP records In compliance with the Paperwork affected by each provision of the rule must be maintained. The burden chart Reduction Act of 1995 (44 U.S.C. are based on the percentage of reflects the estimated annual burden for 3507(d)), the agency has submitted a manufacturers, ingredient suppliers, record maintenance, for periodically copy of this proposed rule to OMB for repacker/relabelers, distributors, and reviewing records to determine if they its review. Interested persons are warehousers that reported to RTI that may be discarded, and for any requested to send comments regarding they have not established or do not associated documentation for that information collection to the Office of maintain records that would be required activity for records that would be Information and Regulatory Affairs, or recommended under the proposed required under part 111. To avoid OMB (see ADDRESSES). rule. The RTI survey estimated that double-counting, we have not included VI. Environmental Impact 1,566 firms would be covered by this a separate estimate of burden for those Considerations rule including manufacturers, dietary sections that would require maintaining ingredient suppliers, repacker/ records in accordance with proposed The agency has determined under 21 relabelers, distributors, and § 111.125, but have included a single CFR 25.30(j) that this action is of a type warehousers. The time estimates burden estimate for all such records that does not individually or include the burden involved in maintenance under proposed § 111.125. cumulatively have a significant effect on documenting that certain requirements For example, proposed § 111.50(a) the human environment. Therefore,

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neither an environmental assessment Preliminary Regulatory Impact Analysis, Brand names convey some information nor an environmental impact statement in section VII.B of this document. We to consumers about a firm’s is required. perform the Initial Regulatory manufacturing practices. Some private Flexibility Analysis of the effects on the organizations, such as the National VII. Analysis of Impacts proposed rule on small businesses in Nutritional Foods Association and the A. Introduction section VII.C of this document. USP design minimum product FDA has examined the economic standards or manufacturing B. Preliminary Regulatory Impact requirements. The current act contains implications of this proposed rule as Analysis required by Executive Order 12866. some provisions that prevent using Executive Order 12866 directs agencies 1. The Need for the Proposed CGMP putrid substances and insanitary manufacturing practices. In addition, to assess all costs and benefits of Regulations either the threat of litigation or available regulatory alternatives and, The proposed CGMP regulations are consumers seeking compensation for when regulation is necessary, to select needed because establishments that defective products and adverse health regulatory approaches that maximize manufacture, package, and hold dietary events may create incentives for net benefits (including potential ingredients and dietary supplements establishments to adopt good economic, environmental, public health may not have sufficient market manufacturing practices. and safety, and other advantages; incentives to use controls to prevent the Actions by manufacturers, primarily distributive impacts; and equity). adulteration and misbranding of dietary voluntary quality controls, do not Executive Order 12866 classifies a rule ingredients or dietary supplements, provide sufficiently protective industry- as significant if it meets anyone of a including incentives to ensure their wide minimum requirements for number of specified conditions, identity, purity, quality, strength, and manufacturing, packaging, and holding including: Having an annual effect on composition (product quality). of dietary ingredients and dietary the economy of $100 million, adversely Manufacturing, packaging, and holding supplements. Without the proposed affecting a sector of the economy in a practices that ensure product quality regulations, survey evidence shows that material way, adversely affecting can be costly, so establishments may not products in the dietary supplement competition, or adversely affecting jobs. adopt them unless required to do so by market are sorted somewhere between A regulation is also considered a regulation. Without the proposed two types: significant regulatory action if it raises regulations consumers of dietary • Higher-priced products with brand novel legal or policy issues. FDA has supplements cannot be assured that all names or industry certification that determined that this proposed rule, if it establishments are manufacturing follow several of the good were to become a final rule, would be dietary supplements in a way that manufacturing practices proposed here; a significant regulatory action as defined ensures that these products are not • Lower-priced products that contain by Executive Order 12866. adulterated or misbranded. no private certification or respected The Small Business Regulatory Manufacturing, packaging, and brand name and that follow few of the Enforcement Fairness Act of 1996 (Pub. holding practices can compromise good manufacturing practices that are L. 104–121) defines a major rule for the safety if they fail to prevent biological, proposed here. purpose of congressional review as chemical, and physical contamination, Without the proposed rule, the being likely to cause one or more of the or if the wrong dietary ingredients are current practices do not provide all following: an annual effect on the used that present an unreasonable risk consumers with safe manufacturing economy of $100 million; a major of illness or injury. Strength (which is practices or reliable product quality increase in costs or prices; significant the amount of a specific dietary throughout the industry. adverse effects on competition, supplement or dietary ingredient in The market for dietary supplements is employment, productivity, or each tablet or capsule) that differs from full of information; consumers of dietary innovation; or significant adverse effects label statements, missing or extra supplements must sort through on the ability of U. S.-based enterprises ingredients, and inconsistency across information and misinformation about to compete with foreign-based units of the product are other problems the properties of these products from enterprises in domestic or export caused by poor manufacturing practices. magazines, brochures, popular books, markets. In accordance with the Small Products may also be held in insanitary television, and a host of other sources. Business Regulatory Enforcement or environmentally inappropriate However, the information from these Fairness Act, OMB has determined that conditions, or may be physically sources deals most often with the claims this proposed rule, when final, will be damaged if stored improperly. Some for the products themselves, not with a major rule for the purpose of poor manufacturing practices, such as the steps taken by establishments to congressional review. the use of ingredients that are protect against contamination or to FDA has examined the economic undeclared, of incorrect strength, or ensure quality. Private quality control implications of this proposed rule as missing altogether result in a fails to provide industry-wide minimum required by the Regulatory Flexibility misbranded product. The proposed good manufacturing practices for the Act (5 U.S.C. 601–612). If a rule has a CGMP regulations would establish following reasons: significant economic impact on a minimum requirements to ensure that • Establishments do not have substantial number of small entities, the manufacturing, packaging, and holding incentives to disclose information about Regulatory Flexibility Act requires practices ensure the identity and quality their own practices, because disclosure agencies to analyze regulatory options of components, dietary ingredients, and that some consumers may perceive to be that would lessen the economic effect of dietary supplements. harmful or undesirable would reduce the rule on small entities. FDA finds Consumers today rely on the demand for their products. that this proposed rule would have a manufacturer’s assurances, existing Establishments therefore have significant economic impact on a regulations and statutes (for example, incentives to withhold information from substantial number of small entities. section 402(a)(3) and (a)(4) of the act), consumers. We carry out the cost-benefit analyses and recourse to the legal system to • Businesses normally do not required for significant rules in the ensure that products are not defective. advertise differences in manufacturing

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practices. They seldom have access to adulterated foods that consist of filthy, percent of small firms and 11 percent of competitors’ proprietary information, putrid, or decomposed substances or large firms do not follow a good and they may fear that advertising based foods that have been prepared, packed, manufacturing practice model. The on differences in practices would or held under insanitary conditions so survey results also show that 32 percent discredit the entire industry. that they may become contaminated or of vitamins and mineral establishments, • Without public disclosure of may be rendered injurious to health; 39 percent of amino acid/protein/animal product quality and adverse health • Publicity from private consumer extract establishments, 41 percent of events, the link between manufacturing groups or health agencies on the risks herbal and botanical establishments, practice and health hazard is difficult to from products not manufactured using and 59 percent of establishments not establish. The link is probabilistic, CGMP regulations, manufacturers already classified, do not follow a good requires data pooling across products assurances, and the voluntary adoption manufacturing practice model. and establishments (in order to establish of some or all provisions of the Without industry-wide uniform cross sectional variation), and can be proposed regulations; requirements, some establishments may interpreted in a variety of ways. • Current or enhanced State and local follow different practices but convey the • Because many consumers already enforcement activity to bring about a message that they follow good mistakenly believe that the Federal reduction of potential harm from manufacturing practices. In short, Government guarantees safety, contaminated or poor quality dietary people who want to discriminate businesses have weak incentives to supplements; or between establishments that use good adopt good manufacturing practices, • Litigation or the threat of litigation practices and those that do not would which are costly. In one recent survey by consumers who allege harm from not have sufficient information to do so. of the nation’s consumers, 34 percent consumption of the dietary supplement. Another reason for our skepticism about report that they believe that the We believe that there are compelling universal voluntary adoption of good government regulates dietary reasons not to rely on these alternatives manufacturing practices is that good supplements to ensure safety and that alone. practices appear to be taken for granted products do what they claim to do. (For If public and private health agencies, by many consumers. Indeed, some details of the survey, see Ref. E3.) If consumer groups, competitors, trade consumers already believe that the people believe that good manufacturing organizations or other third parties Federal Government regulates the practices are already followed, publicized the risks from products not manufacturing practices of the industry, manufacturers may believe they gain manufactured using private good so firms lack an incentive to provide little from voluntarily adopting them. manufacturing practices, then additional assurance (Ref. E3). Information about manufacturing consumers would decide for themselves Current or enhanced State and local practices for dietary supplements is on the risks of contaminated or poor regulations could bring about a imperfect and costly to produce, so quality products. The weakness of this reduction of potential harm from well-informed people should be willing alternative is that third-party contaminated supplements. This to pay for improvements in the quality organizations cannot easily discover alternative has the advantage that State of information. An important benefit of many of the problems caused by poor and local governments can exercise the proposed regulations will be to manufacturing practices because more discretion when responding to reduce variation in manufacturing manufacturers are reluctant to local manufacturing conditions or practices and ensure minimum quality voluntarily share information to third consumer health practices than the for dietary supplement products. parties about their manufacturing Federal Government. Because most of Reducing the variation in product practices. the industry engages in interstate quality by creating industry-wide Actions by manufacturers, such as by commerce, however, Federal regulations minimum requirements reduces the voluntarily introducing good are appropriate. Also, Federal information consumers now attempt to manufacturing practices, occur when regulations would apply uniformly get through costly and uncertain sources the expected private economic benefits across the country, whereas State and in order to make purchasing decisions. of the actions exceed the private costs. local regulations might impose different Voluntary adoption of good standards on establishments that supply 2. Regulatory Options manufacturing practices will occur supplements across State and local FDA considered several regulatory when it is profitable to do so. Many boundaries. options for dealing with current establishments appear to be adopting Litigation or the threat of litigation manufacturing, packaging, and holding some publicly available good may help to bring about the goals of the practices that may not ensure product manufacturing practice models in order proposed rule. The potential of costly quality. The options considered include: to meet the demand for safer and more litigation from the harm caused by (a) No new regulatory action, (b) fewer uniform products. NNFA is deficient manufacturing practices requirements for vitamins and minerals, implementing a good manufacturing creates an incentive for manufacturers (c) more restrictive regulations than the practice certification program. The USP to reduce the risks from defective proposed CGMP regulations, (d) HACCP sets standards for strength, purity, products. However, we do not believe without the other elements of CGMP disintegration, and dissolution for that litigation or the threat of litigation regulations, (e) final product testing individual and combination vitamins has created the incentives for all only, (f) regulations for high-risk and minerals. Also, Consumerlab.com is manufacturers to implement the products or hazards only, and (g) the introducing a certification label, CL, to manufacturing practices that we believe proposed rule. show when ingredients meet their are necessary to avoid adulterated or a. No new regulatory action. Under minimum requirements. However, 36 misbranded products. As discussed this option, consumers would probably percent of recently surveyed dietary earlier, not all surveyed dietary rely on the following as protection supplement establishments do not supplement manufacturers reported that against defective products: follow any good manufacturing practice they followed good manufacturing • Possible enforcement action by FDA models for their products (Ref. E2). The practices. Furthermore, in some cases it under, for example, section 402(a)(3) breakdown of survey results shows that is difficult and costly to demonstrate to and (a)(4) of the act, regarding 48 percent of very small firms, 27 the courts that the harm to plaintiffs was

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actually the result of poor be reduced. Moreover, if dietary propose a requirement that manufacturing practices, making supplements contain too little of a manufacturers implement a HACCP (or recourse to the courts sometimes vitamin or mineral consumers may not HACCP like) system for the impractical. receive the intended health benefits, manufacturing of dietary supplements In the absence of the proposed CGMP and if the dietary supplements contain without the other elements of the regulations, the burden of monitoring too much of a vitamin or mineral they proposed CGMP regulations. A critical manufacturing practices would fall may experience illness or injury. control point is where production more heavily on consumers, despite the We estimate that the benefits of this controls can be applied to reduce or difficulties consumers face in option would be approximately eliminate hazards (including biological, monitoring manufacturers. Moreover, proportional to the ratio of recalled chemical, or physical contamination) the proposed CGMP regulations are products that were classified as that may make dietary supplements preventative and should ensure that vitamins and minerals to all recalled unsafe. problems are identified and dealt with dietary supplements products. The advantage of an industry-wide during manufacturing, packaging, and Approximately 50 percent of the HACCP program is that HACCP does not holding, rather than after someone has recalled products were vitamins and require manufacturers to follow detailed consumed an unsafe product and minerals so we estimate that this option uniform requirements in order to experienced an adverse effect. would generate no more than $109 achieve desirable outcomes. b. Fewer requirements for vitamins million in benefits. We assumed that the Manufacturers themselves determine for and minerals. FDA could require more costs of this option would be their specific products and processes controls from establishments that proportional to the fraction of how they will best eliminate, reduce, or manufacture, package, or hold plant or establishments that would be required control hazards in the manufacturing of animal derived dietary ingredients such to follow all of the proposed provisions dietary supplements. as amino acids, proteins, herbals, and those that follow the reduced We have not designed a hypothetical botanicals and other products not requirements with the total costs HACCP system for the dietary classified as vitamin and mineral estimated for this proposal as shown in supplement industry. For the purpose of manufacturers, packagers, or holders. table 17 of this document. The generating estimates of costs and The plant or animal derived dietary estimated mean cost of the proposed benefits, we assumed that a HACCP ingredients are probably characterized regulation is $86 million (see table 19 of regulation for a dietary supplement by greater variation in product quality this document). The fraction of manufacturer would be likely to than synthetically derived dietary establishments required to follow all the encompass sanitation prerequisites that ingredients. Under this option, the provisions is .46 (= 723/1566). The are met, writing a HACCP plan, and segment of the industry that fraction of establishments that would monitoring critical control points. The manufacture, package, or hold products have reduced testing is .54 (= 843/1566). benefits and costs of the HACCP plan that are the most likely to have Testing is approximately 36 percent of would be generated by controls for a difficulty manufacturing or maintaining the total costs. We estimate the total narrower set of hazards in the uniform product quality dietary costs from this option to be $69 million manufacturing, packaging, and holding ingredients would be required to follow ($86 million × .46 + $86 million × .54 processes than those covered by this the proposed testing and other × (1¥.36)). proposal, and would not include the production and process control c. More restrictive CGMP regulations other benefits and costs generated by the requirements. Manufacturers of than the proposed regulations. One proposed rule especially the reduced vitamins and minerals would be option is to propose (or finalize) more consumer search costs, because uniform required to follow the sanitation, restrictive rules than the proposed product quality would not necessarily holding, and consumer complaint CGMP regulations. Under this option, be assured. The advantage of HACCP as provisions only, they would not have to CGMP regulations could provide an option to prevent product adopt manufacturing controls to ensure consumers with additional safeguards. contamination is that it does not specify that products did not contain too much Several of the largest manufacturers of detailed manufacturing requirements. or too little of a vitamin or mineral. dietary supplements now voluntarily The disadvantage is that in the absence Plant or animal ingredients are likely comply with some of these additional of uniform controls there would not be to experience greater natural variation safeguards (Ref. E2). The most uniform minimum product quality in product quality than synthetic significant additional provisions that across the industry and consumers compounds, so they may require the would be required under this option are would not derive the same benefits from higher minimum standard of regulation product quality testing for each lower search costs. contained in the proposed regulation. incoming shipment lot of components e. Require final product testing only. The advantage of this option is that and dietary ingredients, inprocess FDA could propose that manufacturers fewer establishments will be affected as testing for contaminates at critical test their finished products for identity, much; approximately 723 control points and mandatory written purity, quality, strength, and establishments classified as procedures for all of the various composition but not include any of the manufacturers, packagers or holders of provisions of the proposed regulation. other mandatory provisions of the products other than vitamins and The advantage of this option is that proposed regulation. The advantage of minerals, rather than the 1,566 the additional requirements provide this option is that it would be the least establishments estimated to be covered safeguards that the essential safety and costly option of those considered. Many by the proposed regulation (see table 2 quality provisions are being followed. firms already test some of their finished of this document). The compliance costs The disadvantage of this option is that products, reducing the impact of this would therefore be lower. The it is more costly than the proposed rule, option. Approximately 69 percent of disadvantage is that vitamin and and we are not aware of any information manufacturing plants conduct finished mineral manufacturers also potentially that would show any additional product testing and almost 65 percent of manufacture products of variable verifiable health benefits. all finished batches in the industry are quality, so the expected benefits from d. HACCP without the other elements already tested using physical, chemical, more consistent product quality would of CGMP regulations. The agency could microbiological, visual or organoleptic

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testing techniques (Ref. E2). The options, but it does not generate the full supplements. We therefore have no problem with this option is that finished range of benefits provided by the basis upon which to begin a full product testing alone cannot ensure proposed rule. evaluation of what the high-risk product quality for some types of f. Regulate only high-risk products. products are or may be. products. Not every finished product FDA could propose CGMP regulations 3. Coverage of the Proposed Rule currently has a test that confirms that would cover only high-risk products. The advantage of this option identity, purity, quality, strength, or The proposed rule would cover is that it would impose lower costs than composition, especially for establishments that manufacture, the proposed rule, but (if all risky multiingredient products. Tests may not package, hold dietary ingredients or products could be identified and have been developed, or they may not dietary supplements. Tables 2, 3, and 4 be completely reliable, or they may not regulated) generate the same level of benefits. Only those establishments that of this document list the estimated be capable of evaluating every type of number of covered manufacturers, product defect. Also, potentially lower manufacture high-risk products or have high-risk hazards would incur the costs packagers, dietary ingredient suppliers, cost alternatives to finished product of adopting CGMP regulations. High-risk holders, and other establishments. Table testing—such as incoming component might be defined as those products most 2 of this document shows the number of lot testing, inprocess testing, or both— likely to be contaminated, or suffer covered establishments by product type might be available and desirable to firms other product defects. There are two and size. A small business, based on the as a means to protect the public. problems with this option. Adverse Small Business Administration Moreover, finished product testing event reporting is not mandatory, so definition, is any firm with 500 or fewer alone is not sufficient to prevent significant underreporting is expected. employees. For purposes of analysis, we products with microbiological or Also, it is possible that the confirmed defined very small establishments as chemical contamination from being illnesses and other problems linked to having fewer than 20 employees. Table discovered because it is possible that particular dietary supplements may be 3 of this document shows the number of false negatives might occur, as when those most easily traced, rather than establishments categorized as there is ‘‘hotspot’’ contamination within those with the highest risk. High levels manufacturers, ingredient suppliers, a batch. Preventative controls must be of identified problems may not be repackers or relabelers, holders whose imposed to achieve that goal. Finally, closely correlated with high levels of primary business is dietary ingredients finished product testing alone also will risk. In other words, problems or dietary supplements, and other not facilitate trace backs when defective associated with the known defective (although not including other holders products are discovered in the products may or may not be correlated and distributors). Table 4 of this marketplace, nor will it facilitate with the highest risk. Without more data document shows our estimate of the responsible investigations of consumer and risk assessments, it would be number of general warehouses and complaints. The estimated cost of this difficult to distinguish what risks may wholesalers that hold dietary option is lower than that of the other be associated with particular dietary supplements.

TABLE 2.—COVERED ESTABLISHMENTS BY PRODUCT TYPE AND SIZE FROM DIETARY SUPPLEMENT ENHANCED ESTABLISHMENT DATABASE (DS–EED)

Very Product type small % Small % Large % Unknown % Total

Vitamins and Minerals...... 252 29.8 223 26.5 78 9.2 290 34.5 843 Amino Acids, Proteins ...... 21 31.0 16 23.0 6 6.9 27 39.1 69 Herbals and botanicals ...... 148 42.6 46 13.2 5 1.1 150 43.1 348 Supplements not already classified ...... 93 30.4 66 21.6 20 6.5 127 41.6 306

Total ...... 514 32.8 351 22.4 106 6.8 594 38.0 1,566

TABLE 3.—COVERED ESTABLISHMENTS BY TYPE OF OPERATION FROM DS–EED

Number of Percent of Establishment type establishments establishments

Manufacturer ...... 1,228 78.4 Dietary ingredient supplier ...... 106 6.7 Repacker; relabeler ...... 26 1.7 Holder ...... 114 7.3 Establishments not already classified ...... 92 5.9

Total ...... 1,566 100.0

TABLE 4.—COVERED ESTABLISHMENTS THAT HOLD DIETARY SUPPLEMENTS

Number of Type of holders Source and SIC code establishments

Grocery Wholesalers or Drug Wholesalers ...... Dunn and Bradstreet: 5122, 5141 ...... 25,527 Food or Drug Warehouse ...... Dunn and Bradstreet: N/A ...... 738 Miscellaneous Food or Drug Warehouse ...... Dunn and Bradstreet: 4225, 4226, 5912, 5499, 5411, 5122, 238 5141, 5149, 5399, 5311, and 5331.

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TABLE 4.—COVERED ESTABLISHMENTS THAT HOLD DIETARY SUPPLEMENTS—Continued

Number of Type of holders Source and SIC code establishments

Dietary Supplement ...... DS–EED ...... 114

Total ...... 26,617

We consulted several sources to requirements do not apply to retailers supplements that were neither vitamins estimate the number of establishments and transporters. We believe that and minerals nor herbals and botanicals reported in tables 2, 3, and 4 of this retailers and transporters may increased less, averaging 11 percent per document. The number shown in tables voluntarily adopt provisions related to year. The lowest annual sales increases 2 and 3 of this document, 1,566, is the the holding of these products and thus were for vitamins and minerals, estimated number of establishments in there may be changes in the marketplace averaging 8 percent per year. For all the DS–EED that manufacture, with accompanying costs and benefits. dietary supplements combined, sales repackage, supply dietary ingredients, However, we expect that the only increased an average of 12 percent a or hold dietary supplement products in retailers and transporters that will year since 1994 (not shown on the the United States. RTI developed the voluntarily adopt the proposed table). DS–EED using FDA’s Official requirements are those that expect the Establishment Inventory (OEI) and private benefits of adoption will exceed While the sales growth shown in table supplemented that source with the private costs. 5 of this document, Panel A, is information from trade organizations, impressive, only part of this apparent trade shows, and electronic databases 4. Baseline Practices growth represents increased use. (Refs. E1 and E2). a. Consumer baseline practices. Population growth and rising prices also The number of establishments in the Baseline consumer and manufacturer contributed to the apparent growth. The DS–EED that hold dietary supplements practices, governed by current market real (growth inflation-adjusted) increase is not the total number of holders forces and existing government in dietary supplement prices is covered by the proposed regulation. The regulations, give rise to the current risks estimated by subtracting the inflation holding establishments in the DS–EED associated with the manufacturing of rate from the rate of price increases of identified holding dietary supplements dietary supplements. When determining dietary supplements (Ref. E4). As shown as their primary business. To estimate baseline manufacturing practices, it is in table 5 of this document, Panel B, the total number of establishments that necessary to estimate both the practices between 1995 and 1997 the real price of could hold dietary ingredients or dietary that are used now, as well as the likely vitamins and minerals and supplements supplements but do not consider dietary changes in manufacturing practices that other than vitamins and minerals all supplements as their primary business, will occur even in the absence of new increased. Rising real price indicates we performed three searches of firms regulations. The risks to consumers that demand is growing rapidly. that are listed with Dun and Bradstreet’s from these products can be associated Dialog database. We first looked for a with a combination of consumption Table 5 of this document, Panel C, count of firms that had standard habits, the contamination of the shows estimated annual increases in per industrial classification (SIC) codes for products, or both. Contamination may capita consumption of dietary wholesalers of groceries or drugs. Next be caused by current manufacturing supplements.1 As shown in table 5 of we looked for a count of firms that met practices. Consumption is influenced by this document, Panel C, the estimated the description of warehouses of the price and quality of dietary per capita consumption of the different groceries or drugs (no SIC codes were supplements, set by the interaction of categories of dietary supplements has used). Finally, we looked for a count of market participants. Finally, changes in increased since 1994. any firms that had both warehouse SIC practices of either consumers or For the consumption estimates in codes and miscellaneous drug stores, manufacturers caused by new regulatory table 5 of this document, we averaged food stores, sundries, and general requirements will give rise to changes in dietary supplement use over the entire merchandise (SIC 4225, 4226, 5912, risks, as estimated by changes in costs U.S. population, 275 million. In table 6 5499, 5411, 5122, 5141, 5149, 5399, and benefits. of this document, we included 5311, and 5331). The results are shown The consumption of dietary estimated average supplement use for in table 4 of this document. We supplements has grown in recent years. the population of supplement users, 160 concluded that the total number of Consumers report that they are using a million (Ref. E13). The three panels in establishments in this category that wider range of product types, and that table 6 of this document show the could hold dietary ingredients or dietary they are using dietary supplements for supplements and would be covered by more reasons than they were in the past. annual consumption per supplement the regulation was approximately the Table 5 of this document illustrates user and the annual change in sum of the numbers counted in the three the rapid sales growth of the dietary consumption per supplement user for searches, or 26,617. supplement industry from 1994 to 2000. The number of establishments that Panel A of table 5 of this document 1 An index measuring per capita consumption of hold dietary ingredients or dietary shows annual sales of three general dietary supplements can be derived using the following equation: PCCt = [1,000 × Salest]/[POP × supplements includes retailers that sell categories of dietary supplements, a Pt ], where, t = year index; PCCt = per capita dietary supplements to consumers, and measure of the market size of the consumption (# of unit sales); Sales = millions of transporters of dietary ingredients and supplement industry. Annual increases dollars of sales; POPt = thousands of U.S. residents; Pt = average price of supplement. In the formula, dietary supplements. We made no effort in sales of herbals and botanicals were we measure consumption as the number of dietary to determine the number of such the greatest, averaging 18 percent per supplement units (bottles, packages, etc.) sold per holders, because the proposed year, while annual increases in sales of U.S. resident for a given year.

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vitamins and minerals, herbals and user has apparently declined since that the estimated trend in consumption botanicals, and supplements other than 1994. per user is biased. This trend, expressed vitamins and minerals and herbals and One limitation of the estimates in as the percentage change in botanicals. Table 6 of this document table 6 of this document is that consumption per user, is negative for all also shows that during this period the prevalence of supplement use is based segments of the dietary supplement proportion of consumers using on the proportion of U.S. adults industry since 1994. The large and supplements increased faster than the consuming supplements, while the per rising number of consumers accounts average consumption for the total capita consumption figures are based on for the growing size of the dietary population. The surprising implication the entire U.S. population. Nonetheless, supplement industry. of this result is that consumption per we do not have any reason to believe

TABLE 5.—GROWTH IN MARKET SIZE AND PER CAPITA CONSUMPTION OF DIETARY SUPPLEMENTS, 1994–2000

1994 1995 1996 1997 1998 1999 2000

Panel A—Nominal Market (Millions of Current Dollars)

Vitamins ...... 3,960 4,220 4,780 5,190 5,550 5,940 6,360 Growth rate (percent) ...... 6.57 13.27 8.58 6.94 7.03 7.07 Minerals ...... 700 800 900 1,070 1,160 1,250 1,350 Growth rate (percent) ...... 14.0 13.0 19.0 8.0 8.0 8.0 Herbals and Botanicals...... 2,070 2,530 2,990 3,530 4,170 4,840 5,520 Growth rate (percent)...... 22.22 18.18 18.06 18.13 16.07 14.05 Supplements other than vitamins/min- erals and botanicals...... 2,070 2,290 2,620 2,890 3,180 3,490 3,840 Growth rate (percent) ...... 10.63 14.41 10.31 10.03 9.75 10.03 Total ...... 8,080 9,840 11,290 12,680 14,060 15,520 17,070 Growth rate (percent) ...... 12.0 15.0 12.0 11.0 10.0 10.0

Panel B—Prices

Consumer price index-units (percent) ..... 148.5 152.5 157.0 160.5 163.2 166.7 ...... Inflation rate (percent) ...... 2.56 2.76 2.957 2.23 1.68 2.14 2.39 Vitamins and minerals ...... Average nominal price (IRI) ...... $6.20 $6.50 $6.87 $7.34 $7.54 $7.78 $8.05 Nominal price increase (percent) ...... 2.69 4.84 5.69 6.84 2.72 3.18 3.43 Real price increase (percent) ...... 5.25 2.08 2.74 4.61 1.04 1.04 1.04 Supplements other than vitamins and minerals: Average nominal price...... $6.20 $6.50 $6.87 $7.34 $7.70 $8.11 $8.56 Nominal price increase (percent) ..... 5.80 4.84 5.69 6.84 4.85 5.31 5.56 Real price increase (percent) ...... 3.24 2.08 2.74 4.61 3.17 3.17 3.17

Panel C—Per Capita Consumption (Number of Units Sold Per U.S. Resident)

Vitamin/mineral sales...... 2.45 2.47 2.62 2.64 2.72 2.80 2.87 Growth (percent)...... 0.69 6.19 0.66 3.12 2.74 2.55 Herbals sales...... 1.28 1.48 1.64 1.80 2.00 2.19 2.34 Growth (percent) ...... 15.48 10.79 9.45 11.60 9.17 7.03 Supplements other than vitamins and minerals and herbals sales ...... 1.28 1.34 1.44 1.47 1.53 1.58 1.63 Growth (percent)...... 4.53 7.26 2.26 3.95 3.23 3.25

TABLE 6.—COMPARISON OF CONSUMPTION PER PERSON WITH CONSUMPTION PER USER: EVIDENCE THAT THE DIETARY SUPPLEMENT MARKET IS BECOMING BROADER NOT DEEPER

Average Growth 1994 1995 1996 1997 1998 1999 1994–2000

A. Vitamins and Minerals

Per capita consumption (units per U.S. resident) ...... 2.45 2.47 2.62 2.64 2.72 2.80 ...... % Growth ...... 0.69 6.19 0.66 3.12 2.74% 2.68% Consumption prevalence (percent) ...... 47.70 54.0 61.0 70.0 79.0 ...... Reference ...... Ref. E6 Ref. E6 Ref. E6 Ref. E6 Ref. E7 ...... % Growth ...... 13.44 13.44 13.44 13.44 13.44 Consumption per user (units) ...... 5.18 4.85 4.30 3.91 3.54 ...... % Growth ...... ¥6.39 ¥11.27 ¥9.10 ¥9.43 ¥9.05

1994 1995 1996 1997 1998 1999 1994–1999

B. Herbals and Botanicals

Per capita consumption (units per U.S. resident) ...... 1.28 1.48 1.64 1.80 2.00 2.19 ......

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TABLE 6.—COMPARISON OF CONSUMPTION PER PERSON WITH CONSUMPTION PER USER: EVIDENCE THAT THE DIETARY SUPPLEMENT MARKET IS BECOMING BROADER NOT DEEPER—Continued

Average Growth 1994 1995 1996 1997 1998 1999 1994–2000

% Growth ...... 15.48 10.79 9.45 11.60 9.17 11.30 Consumption prevalence (percent) ...... 8.20 12.10 12.10 12.10 28 49 ...... Reference ...... Ref. E8 Ref. E8 Ref. E8 Ref. E9 Ref. E10 Ref. E7 ...... % Growth ...... 47.56 0.00 0.00 131.40 75.00 50.79 Consumption per user (units) ...... 15.64 12.24 13.56 14.84 7.16 4.47 ...... % Growth ...... ¥21.74 10.79 9.45 ¥51.77 ¥37.62 ¥18.18%

C. Supplements Other than Vitamins and Minerals and Herbals and Botanicals

Per capita consumption (units per U.S. resident) ...... 1.28 1.34 1.44 1.47 1.53 1.58 ...... % Growth ...... 4.53 7.26 2.26 3.95 3.23 4.24 Consumption prevalence (percent) ...... 5.1 8.8 11.2 14.2 18.1 23.0 ...... Reference ...... Ref. E8 Ref. E8 Ref. E8 Ref. E8 Ref. E8 Ref. E7 ...... % Growth ...... 72.55 27.15 27.15 27.15 27.14 36.23 Consumption per user (units) ...... 25.15 15.24 12.85 10.34 8.45 6.86 ...... % Growth ...... ¥39.42 ¥15.64 ¥19.58 ¥18.25 ¥18.81 ¥22.34

b. Manufacturer’s baseline practices. establishments sampled were not includes the establishments discussed FDA contracted with RTI to conduct a eligible for the survey because they were in section VII.B.3 of this document. If survey of the dietary supplement no longer in operation at the listed firms start good manufacturing practices industry to learn about both baseline address or did not handle any dietary in the absence of this rule, both the (existing) manufacturing practices and supplements or ingredients for human costs and benefits of the rule would be the existing standards used for consumption. less than we estimate. If firms were to manufacturing dietary ingredients and To achieve the highest possible stop in the absence of the rule, both the dietary supplements (Ref. E2). A sample response rate, RTI operated a toll-free costs and benefits would be more than of 966 dietary supplement help line and attempted to contact each we estimate. We lack information about establishments from the DS–EED establishment up to eight times before the trend in the industry, so we database was selected from an estimated assigning a disposition of nonresponse. assumed that the survey reflects both eligible population of 1,566 firms in the RTI also attempted up to two refusals the current and future practices in the industry. The sample was stratified by conversions, which are attempts to industry. We request comment or manufacturer’s product type and the persuade firms that declined to answer information about the industry trend in size of firm in the industry. the survey to respond. The survey was adopting good manufacturing practices. Stratification helps ensure that conducted over a 10-week period, i. Stratification. The survey was estimates of the subpopulations are November 29, 1999, to February 4, 2000. stratified by product type and more precise. Establishments that were There were a total of 238 completed establishment size. Stratification stratified by manufacturer’s product surveys, resulting in a final disposition ensures that samples are representative type were classified as primarily: (1) of: (1) An overall eligibility rate of close of the industry population.2 The Vitamins and minerals; (2) amino acids, to 50 percent, and (2) a response rate of subdivisions of the population of proteins, or animal extracts; (3) herbals 50 percent. interest here were establishment size (by and botanicals; or (4) all other product Determining baseline practices is the number of employees) and product types not already classified. The necessary in order to determine the new type, because these characteristics are product type strata were further activities that are likely to take place as likely to influence whether an stratified by four size categories: (1) a result of implementation of this establishment already has adopted the Very small, (2) small, (3) large, and (4) proposed rule. Each of the new practices that would be required by the unknown. This categorization generated activities potentially brought about by regulation. The DS–EED includes nine 16 sampling strata. the proposed rule has both a marginal product types: (1) Vitamins and The contractor, RTI, sent each of the (or incremental) cost and a marginal (or minerals; (2) herbals and botanicals; (3) 966 firms in the sample a lead letter on incremental) benefit. These incremental herbal and botanical extracts; (4) amino FDA letterhead and a one-page brochure costs and benefits of likely new acids; (5) proteins; (6) animal extracts; to explain the purpose of the survey, the activities form the basis of our economic (7) tea like products; (8) concentrates, value of the establishment’s analysis of the proposed rule. metabolites, or constituents; and (9) participation, and the agency’s The survey asked establishments a supplements not already classified (all confidentiality procedures. Following series of questions about existing other supplements). Establishments may the mailing, RTI placed telephone calls practices; we used the responses to produce more than one product type; to each establishment to screen for estimate how many establishments in establishments with multiple product eligibility and to recruit eligible the industry already operated in types were, however, only classified in establishments for the mail survey. To accordance with the requirements of the one category. For stratification and be eligible for the survey, proposed regulation. One key reporting purposes, we defined the establishments had to currently assumption in this analysis is that no manufacture, repackage, supply dietary firms are expected to stop CGMPs and 2 Stratification is a subdivision of the population ingredients, hold, import or export no firms are expected to start good of establishments in the dietary supplement dietary supplements for human manufacturing practices in the absence industry by a unique characteristic such as product consumption. Almost 50 percent of the of this rule. The universe for the survey type or number of employees.

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following four mutually exclusive as part of a small or large company. To (if data on employment were not categories of dietary supplements: obtain parent company data for available), then the establishment was 1. Vitamins and minerals (includes establishments in the survey universe, classified as small. An establishment establishments that may also we sent InfoUSA 3 the DS–EED data was classified as very small if the manufacture, package, or hold herbals records (N = 2,004) and requested the number of employees was less than 20. and botanicals, amino acids, proteins, or name, address, primary SIC, iii. Survey response. Table 7 of this animal extracts but predominately employment size (in ranges), and manufacture vitamins and minerals); document presents the number of revenue (in ranges) of parent company establishments surveyed, stratified by 2. Amino acids, proteins, and animal firms with establishments in the survey the four product types and by size. extracts (includes establishments that universe. InfoUSA matched 1,219 of the Although the sample allocation was also manufacture, package or hold 2,004 records in the DS–EED to their designed to yield 400 completed herbals and botanicals, including U.S. database of 10.3 million businesses. surveys, we received only 238 extracts; excludes establishments Of the 1,219 matched records, 31 completed mail surveys. The number of already classified as vitamins and records were found to be duplicates of minerals); another record and were removed, respondents was fewer than expected 3. Herbals and botanicals, including leaving 1,188 matched records and because the number of establishments extracts (excludes establishments 1,566 total records in the sampling that were ineligible was greater than we already classified as ‘‘vitamins and frame. The nonmatched records did not expected and because some minerals’’ or ‘‘amino acids, proteins, or match because: (1) They were recently establishments did not respond to the animal extracts’’); and established businesses, (2) they were out survey after agreeing to participate. 4. Supplements not already classified of business, or (3) they had recently Ineligible establishments are those that (all other product types). no longer produce dietary supplements We further stratified each of the four changed their names or addresses. Because data on revenue or employment because they have gone out of business product categories into four size or changed product lines, or they have categories, very small, small, large, and size were not available for the nonmatched records, we created an moved and could not be located. unknown—resulting in 16 sampling Despite receiving fewer responses than strata. We classified each establishment ‘‘unknown’’ stratum for these establishments. The survey of practices planned, the confidence level for the into one mutually exclusive industry final results allowed us to make category (manufacturer, dietary collected information on employment meaningful inferences regarding the ingredient supplier, repacker/relabeler, that allowed us to classify some of these industry. For example, 65 percent of the holder, or establishment not already establishments by size for the analysis. establishments surveyed responded that classified). Establishments that Of the 1,188 matched records, 180 manufacture supplements and also were linked to parents. The parent they followed published good supply, repack, or hold dietary company data for these 180 manufacturing practice models; the 95 supplements or ingredients were establishments were merged with the percent confidence interval was 56 to 72 classified as manufacturers. survey universe. The remaining 1,008 percent. By size category, 52 percent of ii. Size stratification. The Small records did not link to an ultimate very small, 73 percent of small, and 89 Business Administration classifies parent company. For these records, the percent of large establishments companies as ‘‘small’’ based on the size establishment and parent company were responded that they followed published of the entire company, including both the same entity, so we used good manufacturing practice models parent and subsidiaries. If firms that establishment level data to classify size. (Ref. E2). Although we do not suggest manufacture dietary supplements have We classified each of the establishments that these percentages are precise, they 500 or fewer employees, they are in the survey universe as part of very do tell a plausible story of the current classified as small. Because the DS–EED small, small, or large businesses based use of good manufacturing practice data on size are only for specific on the employment size or annual models in the supplement industry: The establishments and not parent firms, we revenues of each establishment’s parent use of good manufacturing practice had to obtain parent company company. If an establishment or its models appears to be widespread but far information on employment or revenue parent company had 500 or fewer from universal, with use more likely the to correctly classify each establishment employees or sales less than $20 million larger the establishment.

TABLE 7.—NUMBER OF COMPLETED SURVEYS BY SAMPLING STRATA

Size Product type Very small Small Large Unknown Total

Vitamins and minerals ...... 19 39 13 1 72 Amino acids, proteins ...... 8 7 0 5 20 Herbals and botanicals, including extracts ...... 58 25 0 30 113 Supplements not already classified ...... 14 13 2 4 33

Total ...... 99 84 15 40 238

The mean survey results reflect the each practice. The use of a survey for the use of the survey answers from more degree of uncertainty associated with this economic analysis often required than one question to assess the impact

3 InfoUSA is a publicly held company that creates address, phone number, fax number, estimated business (SIC code or yellow page heading), key proprietary business databases. Their database sales, volume, number of employees, type of contact names, and titles. includes such information as: Company name,

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of each proposed provision. For • We could take the number of avoidable manufacturing mistakes. We example, answers to questions about reported cases and multiply by a factor have recall data that show that testing herbals might have been to account for underreporting. manufacturing mistakes exist, so we can combined with questions about whether • We could take the number of construct a possible link between the firms manufactured herbals. Some defective products and multiply by the manufacturing mistakes and potential highlights of the survey are: probability of illness for the given illnesses or injuries. The number of • Plant characteristics: Manufacturers defect. illnesses associated with a recall is both account for 62 percent of the total firms In an ideal analysis, we would variable and uncertain, and could be and 36 percent of manufacturers estimate the baseline both ways and anything from zero to quite large. We produce vitamins and minerals as their then compare them. For the analysis of concluded that one illness would not be primary product. illnesses from poor manufacturing an implausibly high average for a recall, • Use of published good practices, however, we did not have so we assumed that a recalled product manufacturing practice model: 65 sufficient data to perform either type of could be a proxy for a single reported percent of all firms follow some type of baseline estimate. illness associated with a defective We looked at many sources for good manufacturing practice model, product. We ask for comments on this information, including medical and primarily food good manufacturing assumption. other literature on adverse events, practices; 28 percent follow the NNFA Because there are no well established information from poison control centers, good manufacturing practices and 31 systems for the notification of adverse reports to the agency, popular percent follow FDA’s drug good health events related to dietary newspaper and magazine articles, and manufacturing practice requirements. supplements, and some significant • surveys of users. The literature review barriers to reporting, we assume that Personnel: 67 percent of all was conducted using Medline, establishments maintain records of unreported illnesses caused by poor Healthstar, Aidsline, Cancerlit, and manufacturing practices are personnel education, training, or OldMedline (Ref. E12). We found experience. substantially greater than reported evidence of many adverse events illnesses. We relied on Ref. E16 to • Quality control: 85 percent of all associated with dietary supplements. estimate a more precise relationship establishments have a unit or person For example, one recent survey found between reported and unreported rates. responsible for quality control. Almost that 12 percent of consumers (about 11.9 Based on empirical data for drug and 80 percent of all manufacturers conduct million) who have used an herbal vaccine reporting rates among other at least some type of identity tests on remedy claim to have suffered from side studies, the author of Ref. E16 incoming components and dietary effects or other adverse reactions (Ref. determined that for dietary ingredients and 96 percent of these E13). The American Association of supplements, reported illnesses firms also conduct some type of Poison Control Centers received 6,914 represent at best approximately 1 contamination test; 63 percent conduct reports on dietary supplements in 1998 percent of total illnesses (Ref. E16). A some type of potency test. Nearly 70 (Ref. E14). In a recent survey, 46 percent similar multiplier of 100 linking known percent conduct tests on inprocess of respondents answered that people get cases of foodborne illness to total materials or finished products. Of these sick from dietary supplements ‘‘often’’ incidence is often used. We assume that firms, 97 percent conduct identity tests, or ‘‘sometimes’’ (Ref. E3). In addition, reporting adverse health events due to 94 percent conduct contamination tests the agency has received many voluntary poorly manufactured dietary and 72 percent conduct potency tests. reports of illnesses caused by dietary supplements would occur at the same Asked whether firms hold reserve supplements (Ref. E15). The vast proportion as adverse health events samples of each finished batch, 75 majority of the illnesses described in the caused for other reasons by dietary percent answered yes. Of the plants that sources we consulted, however, are supplements. We show the sensitivity of have production processes, 70 percent reported as associated with the benefits to the choice of multiplier use production and process controls ingredients used in the products below, in the uncertainty and sensitivity that identify the points, steps, or stages themselves, not with poor analysis of our results. in the manufacturing process to prevent manufacturing processes. We have no The outbreak of eosinophilia-myalgia adulteration. Almost 68 percent of all direct evidence on what fraction of syndrome (EMS) resulting from incoming ingredient or component lots illnesses can be attributed to contaminated L–Tryptophan resulted in are tested now and almost 70 percent of manufacturing processes. The anecdotal the recall of the contaminated products. inprocess or finished product batches evidence implies that many illnesses In part based on this example, we are tested in some manner. could have been caused by poor assume that product recalls can indicate • Warehousing: 70 percent of manufacturing processes, but with a few when there are adverse health events. warehouses have temperature controls exceptions, no evidence explicitly links We also assume that the reported class and 22 percent have humidity controls. illnesses to these manufacturing 1 and class 2 recalls that have occurred • Consumer complaints: Only 19 processes. over the last 10 years represent the percent report incidents to FDA. The agency’s recall records are more number and type of recalls that will useful than the reports on illnesses, occur in the future but for the 5. Baseline Risk because the class 1 and class 2 recalls implementation of this regulation. From The current number of illnesses all involve defective products that could 1990 through 1999, the agency received caused by poor manufacturing practices have caused illness if ingested. The reports on an annual average of 13 class requires data linking illnesses directly major public health events that have 1 and class 2 recalls of dietary to poor practices. Without direct been linked to poor manufacturing supplements. If each recall is a proxy for evidence on the number of illnesses processes show up in the list of dietary a reported illness, then the total number caused by poor manufacturing practices, supplements recalled. Although the of unreported illnesses per year is we had to use an indirect approach. recall data cannot be linked directly to approximately 1,300. Obviously, to the There are two indirect ways to estimate illness data, we have found anecdotes, extent that products are successfully the number of illnesses caused by surveys, and some medical literature on recalled, illnesses will be avoided. Our defective products: illnesses that could be caused by assumption is that the recall occurs

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because at best one person on average the reduction in pain and suffering, and suffering (as measured by the symptom- has been made ill. We recognize that our (3) the reduction in expenditures on problem index 5). These losses per day procedure generated highly uncertain medical treatment. We measured lost can be interpreted as the difference estimates of the number of illnesses. productivity indirectly with measures of between a day of normal health, where The use of recalls to estimate reported functional state, which includes normal is defined as the population’s and unreported illnesses probably measures of physical function. We health not affected by these products, generated a distribution of illnesses estimated the losses caused by pain and and a day of suffering from the health below the ‘‘true’’ distribution, because suffering with a symptom-problem conditions caused by these defective many illnesses occur that are not linked index. We used direct measures of products. The numerical scale is a to recalls and are never reported. We medical costs, such as payments to relative baseline that rests on the notion were not able to determine even the physicians and hospitals.4 of a quality-adjusted life day (QALD). approximate size of the underestimation Table 8 of this document contains from this procedure. summaries of our measures of the health The QALD for a day of normal health We estimated the monetary value of effects potentially caused by known equals 1; the QALD for death equals 0. the health benefits from CGMP instances of defective products The loss of QALDs per illness equals the regulations by multiplying the number associated with poor manufacturing daily loss multiplied by the number of of illnesses prevented by the health processes. We estimated the health loss days the illness lasts. We converted costs associated with an illness. The per day for the different levels of illness QALDs to dollars by multiplying the health benefits associated with severity by summing the lost index numbers by the value of a preventing an illness come from: (1) productivity (as measured by functional statistical life day and adding the direct Preventing the loss of productivity, (2) state) and the loss from pain and medical costs.

TABLE 8.—SUMMARY OF HEALTH EFFECTS BASED ON POTENTIAL ILLNESS ASSOCIATED WITH RECALLS BETWEEN 1990 AND 1999

Number Frequency of Quality ad- Duration of Medical cost Health cost Problem Class of of Outcomes illness justed life illness ($) per ($) per recall recalls (percent) day (days) event event

Hypervitaminosis A ... 1 2 ...... 100 0.472 3 84 936 Salmonella ...... 1 4 Mild ...... 93.8 0.473 2 0 534 Moderate ...... 5 0.473 5 800 2,223 Severe ...... 1.2 0.563 17 9,100 14,859 Reactive arthritis 2 0.42 25 100 6,438 (short term). Reactive arthritis 1 0.42 5,223 400 1,320,252 (long term). 2 4 Death ...... 0.04 ...... 9,100 5,009,100 Klebsiella pneumonia 1 1 Severe ...... 85 ...... 6,235 10,650 Death ...... 15 ...... 6,235 5,006,325 Selenium poisoning ... 1 1 Low doses ...... 50 0.482 3 84 954 Severe ...... 35 0.482 3 2,578 4,448 Death ...... 15 ...... 2,578 5,002,578 Stannous fluoride ...... 1 1 Acute ...... 100 0.473 3 84 938 2 1 ...... 0.473 3 84 938 Eosinophilia-myalgia 1 7 Mild ...... 47 0.482 5,223 1,176 1,515,863 syndrome. Moderate ...... 50 0.482 60 84 17,484 2 41 Severe ...... 10 ...... 14,964 27,394 Glass fragments ...... 2 1 Dental injury, simple 50 0.231 1 139 ...... Dental injury, com- 12 ...... 3,741 ...... plicated. Oral emergency ...... 12 ...... 3,741 6,428 Tracheo-esophageal 25 ...... 290 obstruction. Esophageal 1 ...... 14,964 23,343 performation. Hypervitaminosis D ... 2 1 ...... 100 0.473 3 168 1,022 Pyridoxine (vitamin 2 2 ...... 100 0.482 30 168 8,868 B6). Super-potent zinc ...... 2 1 Mild ...... 50 ...... 285 Moderate ...... 40 ...... 596 Severe ...... 10 ...... 1,247 3,347 Niacin ...... 2 1 ...... 100 ...... 84 4,258 Yellow #5 2 5 Mild allergic reaction 90 0.44 2 0 529 (undeclared). Severe allergic reac- 10 ...... 2,494 3,346 tion.

4 The cost of a hospital day is from the Health 5 Functional Status Code is a measure of lost is not possible. Symptom-problem health utility Care Financing Agency’s Indicator Tables. It is the mobility (MOB), physical activity (PAC) and social index is a weighted measure of the cost of each amount per patient day in 1997, adjusted to 1999 activity (SOC). Lost MOB might mean an inability symptom. For example, a sick or upset stomach has dollars. See Ref. E17. to drive a car. Lost PAC might mean walking with a utility weight of .290. physical limitations. Lost SOC might mean self-care

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TABLE 8.—SUMMARY OF HEALTH EFFECTS BASED ON POTENTIAL ILLNESS ASSOCIATED WITH RECALLS BETWEEN 1990 AND 1999—Continued

Number Frequency of Quality ad- Duration of Medical cost Health cost Problem Class of of Outcomes illness justed life illness ($) per ($) per recall recalls (percent) day (days) event event

Contact dermatitis .... 50 ...... 84 1,205 Yellow #6, red #40, 2 1 Abdominal cramps .... 10 0.473 3 84 938 blue #2 (undeclared). Contact dermatitis .... 90 ...... 84 1,205 Copper salts ...... 2 1 ...... 100 0.473 1 84 369 Digitalis ...... 1 33 Mild ...... 94.9 0.473 3 84 938 Severe (heart block) 5 ...... 1,247 455,883 Death ...... 0.1 ...... 5,000,000 Ephedra (undeclared) 1 1 Cardiovascular ...... 14 ...... 1,415 3,530 CVS w/chronic ...... 2 ...... 2,591 457,227 Nervous system ...... 14 0.47 2 1,331 1,900 NS w/chronic ...... 2 ...... 2,507 455,597 Liver impairment ...... 4 ...... 168 4,342 Exfoliative dermatitis 7 ...... 84 1,206 Other ...... 54 0.29 1 0 174 Death ...... 3 ...... 2,507 5,002,507 Lactose (undeclared) 2 1 Mild ...... 100 0.48 1 0 290 intolerance. Iron poisoning ...... 2 1 Mild ...... 100 0.48 1 84 374 Sulfites (undeclared) 1 1 Mild allergic reaction 100 0.44 2 0 529

We used the transformed value of is $5 million/7,968, which is expenditures, reflect the foregone statistical life to estimate the value of approximately $630. We use this value benefits from alternative investments. QALD. For the most likely value of a to estimate the public health benefits The pure social rate of time preference statistical life day, we used $630. We from preventing illness. can differ from the return on private derived this value from a widely-used In addition to lost productivity and investments. pain and suffering, illness caused by estimate of the value of a statistical life: 6. Benefits and Costs $5 million. The $5 million estimate is supplement contamination leads to based on calculations matching labor direct medical costs. Direct medical Changes in current practices by market risks with wages for risky jobs. costs include the cost of medicine, manufacturers, or consumers, or both, Workers in risky jobs tend to receive hospitalization, and visits to physicians cause incremental (marginal) benefits increased wages to compensate them for and other professionals. We included all and costs. There are several possible (usually) small increases in the estimated medical costs, not just out-of- reactions manufacturers might have to pocket expenses. These full medical the proposed regulatory requirements: probability of death. The implicit value • of a statistical life is the increased wage costs often are missed because most Stop producing dietary divided by the increased probability of medical care is covered by health supplements and possibly go out of death. The advantage of valuing insurance that separates the bearer of business. • Move production to a foreign statistical lives with this method is that the medical cost (society) from the country where compliance with these it reflects the observed willingness of bearer of the utility losses (the ill regulations is more difficult to enforce. workers, and by inference, of the whole person). The total costs of illnesses caused by • Comply with part or all of the population of adults, to accept small the contamination of dietary proposed regulation. Consumers will risks to their lives in a real world risk- supplements from poor manufacturing likely be confronted with higher priced dollar tradeoff. practices would be the costs per illness dietary supplements but also products We turn the estimated value of a (classified by severity) multiplied by the that are, on average, more uniform and statistical life into a value of a statistical number of illnesses (classified by higher quality. To the extent that the life day by first assuming that the severity). For chronic illnesses, the latter is unknown to consumers, they workers have a remaining life utility losses and medical costs stretch will probably reduce consumption of expectancy of 36 years (Ref. E18). Using indefinitely into the future. We used a dietary supplements, perhaps in some a 3 percent social rate of time real discount rate of 7 percent to cases substituting them with alternative preference, the present value of 36 years calculate the present value of chronic products such as foods. is 21.83 years. The social rate of time medical expenditures and utility losses. The benefits from the proposed preference is the average long-term real OMB suggests using a real discount rate regulation and the regulatory options rate of interest, with no premiums for of 7 percent to analyze the costs and result from reducing contamination and risk and other factors that affect interest benefits of regulations. This rate adopting practices that will result in rates. Most analysts use the average real approximates the marginal rate of return consistently high quality dietary rate on long-term treasury bonds (3 to 5 on an average investment in the private supplements. Creating industry-wide percent in recent years) to represent the sector in recent years. We used a minimum requirements for good social rate of time preference. The different discount rate for the social rate manufacturing practices should reduce discounted expected days lost for a of time preference (3 percent) and the the occurrence of product defects, statistical death is 21.83 x 365 = 7,968. discount rate of future medical costs (7 which in turn should reduce the Therefore, the value of a statistical day percent). Medical costs, like all number of illnesses and deaths.

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Defective products can cause isolated dietary supplements, which would $healthij = health costs of severity level cases of illnesses, but also rare reduce the number of illnesses and the i of illness j; catastrophic events such as the outbreak probability of deaths caused by QALD = quality adjusted life day; of eosinophilia myalgia syndrome manufacturing problems. The proposed $ per QALD = dollar value of a (EMS) that resulted from the rule would also improve product safety statistical day; consumption of contaminated L- through the provisions requiring records $ medical = direct medical costs; Tryptophan. That outbreak caused 38 and investigations of consumer Eb = expected health benefit from deaths and over 1,500 illnesses. complaints related to manufacturing j The provisions that require practices. We assumed that the preventing a single case of illness j; establishments to maintain consumer proposed rule would reduce both fij = frequency of severity i of illness j complaint files related to manufacturing sporadic illnesses and catastrophic (S fij = 1); practices will generate additional health outbreaks. We estimated the reduction m = number of levels severity for illness benefits. The use of these files by of sporadic or annual illnesses by using j; manufacturers and the agency will help the agency’s recall records as evidence EB [c1], EB [c2] = expected benefits identify dietary supplements that were of possible illnesses; class 1 and class 2 from preventing an average illness manufactured or contaminated in ways recalls of dietary supplements all associated with a class 1 recall or a that could cause a significant or involved adulterated products that class 2 recall; unreasonable risk of illness or injury. could have caused illness if ingested. wj = weight of illness j; We estimated the reduction of illnesses These records may reduce the rj = number of product recalls for hazard likelihood of catastrophic events, from preventing catastrophic events by j; using the public health effects of the because a cluster of illness complaints n = number of hazards or potential types outbreak of EMS that resulted from could be identified, and preventive of illness. action taken before the number of consumption of contaminated L- illnesses reached catastrophic levels. Tryptophan. We then repeated the procedure for Improved product quality will also i. Reduced illnesses estimated from class 2 recalls and the associated reduce the number of products recalled. recall data. For annual illnesses, we illnesses in table 8 of this document. Certain manufacturing practices, such as used this formula for estimating the Table 9 of this document shows the more frequent finished product quality benefits from fewer illnesses: average value of preventing a single testing, help establishments to identify Marginal health benefits = baseline (or illness associated with class 1 and class problems before the products are current) number of illnesses caused 2 recalls. × released for consumption. If defective by poor manufacturing practices We estimated the annual marginal products are caught before they are expected reduction in the number health benefits as the health benefits per of illnesses brought about by the illness for each class of recall multiplied released, they will not be recalled. × Creating minimum requirements proposed regulation health cost by the estimated number of recalls. saved per prevented illness. should also generate benefits for Health Benefits = (EB[c1] × estimated consumers by reducing the variation in We estimated the annual expected annual number of class 1 illnesses product quality. Creating verifiable health benefits for the proposed rule by prevented) + (EB[c2] × estimated minimum manufacturing requirements taking the values in table 8 of this annual number of class 2 illnesses reduces the private effort necessary to document and weighing them by their prevented). distinguish products manufactured, incidence in the table. We computed the packaged, and held using good practices expected health benefits from To estimate the number of illnesses from those using poor practices. preventing a single illness (of any type) prevented, we started with the average Reducing the effort needed to find associated with a class 1 recall as a annual number of products recalled for products with the identity, purity, weighted average of all potential the decade 1990 to 1999—six class 1 strength, quality, and composition, illnesses (see table 8 of this document), and seven class 2. As discussed above, among other characteristics, creates a with the potential illness divided by the we then assumed that these recalled potentially substantial, though implicit, total number of class recalls. products represented proxies for about 1 benefit for consumers. The following formulas show how we percent of all illnesses caused by these The benefits from the proposed rule, calculated the average health benefits of problems leading to the recalls. With then, are from: preventing a single illness associated that assumption, we get 600 illnesses • Reduced health costs caused by the with a class 1 recall. from class 1 recalls and 700 illnesses reduced number of illness; $healthij = (QALD × days × $ per from class 2 recalls (see table 9 of this 6 • Fewer product recalls, and; QALD)ij + $ medicalij document). • Greater assurance of consistent and EBj = Si (fij x $healthij) Table 9 of this document shows the better quality products. EB [c1] = Sj (wj × EBj) estimated value of the health benefits a. Reduced illnesses. The proposed wj = rj/(Sj rj) from the proposed rule using class 1 and regulation would improve the safety of Where: 2 recall data.

TABLE 9.—HEALTH BENEFITS USING RECALL DATA

Total number of illnesses prevented, recall base ...... 1,300 Total number of illnesses associated with class 1 recalls ...... 600 Total number of illnesses associated with class 2 recalls ...... 700

6 We used a probability distribution to represent negative binomial distribution estimates the the probability of reporting equaled 1 percent (Ref. the uncertainty associated with the number of number of failures (unknown cases) that will occur E16). The result is that the mean estimated number illnesses. We modeled the number of illnesses before some number of successes (known cases) for of illnesses is 100 times the reported number of prevented for each class as the average number of a given probability of success. In the negative recalls. recalled products plus a negative binomial binomial distribution, we assumed that the number distribution representing unknown cases. The of recalled products were reported cases and that

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TABLE 9.—HEALTH BENEFITS USING RECALL DATA—Continued Dollar estimate of health benefit for preventing an illness associated with a class 1 recall ...... $60,000 Dollar estimate of health benefit for preventing an illness associated with a class 2 recall ...... $5,000 Dollar estimate of annual health benefits, recall base (million) ...... $39

ii. Health benefits from preventing a health event; the defective products percent of EMS patients were still rare catastrophic event. We estimated could be identified and withdrawn well symptomatic 21 to 64 months after the marginal health benefits from before the event claimed as many onset. The symptoms associated with reducing the probability of a victims as L-Tryptophan. EMS also frequently lead to activity catastrophic event as follows: To estimate the benefits from limitations. Another study of victims Marginal health benefits = Change in preventing reduction in the probability (Ref. E22) found that 74 percent of probability of rare catastrophic of a rare catastrophic event occurring, symptomatic EMS sufferers were event caused by poor we first estimated the period between limited in their functions 12 months manufacturing practices brought now and the last rare catastrophic event, after the onset of illness. about by the proposed regulation × 1989, and we needed to make baseline assumptions about the likely time To find the health cost of the the number of illnesses caused by outbreak, we estimated the cost of the the rare event × health cost saved interval between events. The last following health outcomes: Death, acute per illness. catastrophic event occurred over 13 years ago, so we assumed that the lower illness only, chronic illness with no In 1989, there was a widespread activity limitation, chronic illness with outbreak of EMS resulting from bound would be 50 years. For lack of data, we then assumed a uniform mild activity limitation, chronic illness consumption of contaminated L- with moderate limitation, and chronic Tryptophan. More than 1,500 cases (175 probability distribution between these two bounds, which leads to a rough illness with severe limitations. To acute illnesses and 1,287 chronic determine the cost for each of these illnesses) and 38 deaths were identified estimate of once in 30 years. We do not health outcomes, we multiplied the lost in 50 states (Refs. E21 and E22). The know how likely rare events are, nor do quality-adjusted life days over the outbreak prompted a recall of all dietary we actually know the likelihood of duration of the illness by the value of supplements that contained more than reducing these events by the proposed a life day. For medical costs, we 100 mg per daily dose, which later was regulation. There can be no conclusive expanded to almost all products empirical support for the likelihood of estimated the cost of hospitalization for containing L-Tryptophan. We used the a future event because the past may not the EMS patients who required public health cost of this event as an predict the future in the absence of a hospitalization (32 percent of all estimate of the cost of a future rare stable frequency distribution that victims), by assuming 3 days per catastrophic event associated with reflects a statistically significant number hospital stay. We used $1,284 as the dietary supplements. of similar events. All we know is that cost per day of time spent in a hospital EMS is characterized by severe such an event occurred at least once in (Ref. E17). We assumed that chronic myalgia and elevated eosinophils the recent past, and remains a sufferers visited the doctor once a year counts. Some of the most common possibility. We recognize that our lack at a cost of $84 per visit. We estimated symptoms are fatigue, weakness, fever, of information about such events creates the total cost of the event to be about $2 and arthralgia. Although a repeat of the significant uncertainty about the social billion. Most of the cost of the outbreak EMS outbreak is not expected, it is an costs of these events and the health comes from the deaths and severe example of the rare, catastrophic events benefits from reducing their impact. Our chronic illnesses. Table 10 of this that should be prevented or mitigated by estimate is meant to convey the document shows the values used in the the proposed CGMP regulation. The potential or hypothetical enormity of calculation. Note that the categories are testing provisions of the proposed such an event, not the certainty of such not mutually exclusive. The average age regulation should reduce the probability an event. We would like comments of victims was about 50, so the value of that contaminated ingredients would be regarding our estimate of such an event. statistical life was adjusted accordingly. released to the public. The provisions The health cost of the EMS outbreak If the event occurs about once in 30 for keeping complaint files and was large because of the number, years in the absence of the proposed investigating complaints would allow severity, and duration of the cases. One rule, then the expected average annual more rapid identification of a major followup study (Ref. E21) found 88 cost would be about $66 million.

TABLE 10.—HEALTH BENEFITS FROM PREVENTING RARE CATASTROPHIC EVENT

Costs per Number case

Hospitalization ...... 480 $3,741 Death ...... 38 4,214,301 Acute Illness ...... 175 8,760 Chronic illness not limited ...... 380 1,091,849 Mild chronic illness, limited ...... 190 1,349,002 Moderate chronic illness, limited ...... 307 1,601,539 Severe chronic illness, limited ...... 409 1,602,844 Visits to physicians ...... 1,287 1,539

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The benefits attributable to this catastrophic number of illnesses and the assume consumers expect some proposed rule from preventing a rare public health system accurately unknown number of their products may catastrophic event are highly uncertain. recorded the full number of both not meet their expectations but We do not know if such an event would, sporadic and catastrophic illnesses. purchase them anyway. In other words, in the absence of the proposed b. Fewer products recalled. we cannot rule out the possibility that regulation, ever occur again. The EMS Implementation of the proposed the purchase price already incorporates outbreak may have been a unique event, regulation would reduce the number of the expectations of consumers that some although the recent severe public health adulterated products distributed to the products will be ‘‘lemons.’’ Because we effects associated with aristolochic acid public, which would reduce the number cannot look into the minds of in Europe show that such similar events of products recalled. Manufacturing consumers to determine their remain possible (Ref. E23). We also do practices, such as testing of finished expectations or their willingness to pay not know that if another catastrophic products and better recordkeeping, will for these products, we can only estimate event occurred, the health effects would increase the ability of establishments to the benefits from more uniform quality be as large as for L-Tryptophan. Some of identify problems before products are by estimating the changes in behavior the smaller clusters associated with released for distribution. If adulterated that would occur if consumers were dietary supplements could represent products are caught before they are aware of the change in quality brought small events potentially prevented by distributed, they will not be recalled. about by the proposed rule. In other the proposed CGMP regulations (Ref. To estimate the direct benefits from words, we assume that if the quality E15). fewer recalled adulterated dietary attributes of dietary supplements were We included reducing the likelihood supplements, we estimated the baseline observable, then consumers would of a catastrophic public health event as number of annual recalls of dietary spend time searching for those a benefit of the rule because the battery supplements due to contamination attributes, as they do for other goods. of checks and controls that would be before the proposed regulation. From We measured this benefit as a reduction required under the proposed regulation 1990 to 1999, FDA received reports on in the hypothetical search costs for would reduce the likelihood of such an an average of 20 recalls per year (Ref. product quality, meaning the identity, event occurring again. In particular, the E12). The average figure reported here quality, purity, strength, and requirement that establishments keep includes class 3 recalls. The number of composition claimed on the label. records of consumer complaints should units of dietary supplements for each The hypothetical measure of quality lead to early identification and recalled product varied, so we used a starts by assuming the existence of a prevention of potential catastrophic distribution per recalled product of baseline amount of search necessitated events related to manufacturing 1,000 units to 34,000 units (Ref. E12). by the existence of poor manufacturing practices. Product price also varied, with most practices. Our hypothetical consumers Our estimate of the health benefits prices falling between $5 per unit and must search for products made with associated with this proposal is based $9 per unit; we used a most likely price good manufacturing practices, because on two models that estimate future of $7.70 per unit. We also included an they cannot take such practices for illnesses and deaths prevented by this adjustment for the goodwill lost by the granted when purchasing dietary proposed rule: Illnesses caused by establishment as a result of the recall. supplements. Although the search we sporadically adulterated products and Studies of changes in market valuations use as a measure of the benefits from predicted by recall data; and rare of firms after recalls indicate that the improved quality is hypothetical, the catastrophic outbreaks of illnesses, as value of lost customer goodwill, based values we use in estimating our search predicted by one previous event in the on the decline of the share price of model are based on data and inferences United States and corroborated by one publicly traded stocks from recalls is about real searches for other products. in Europe. The frequency and often as large as the cost of the recall To get the products they want, people magnitude of a rare catastrophic event is itself (Ref. E24). We multiplied the search across the range of market largely hypothetical. In contrast, direct cost of the recall by two in order alternatives. Several recent articles have sporadic illnesses are small but frequent to include the lost goodwill. The result noted the large variation in product events that happen routinely. Small is an estimated savings of about $3 quality for different goods and services sporadic events are characterized by million per year. (Refs. E25, E26, and E27). Searching significant underreporting primarily We based the estimated benefits from takes time and resources that could be because of the difficulty linking an fewer recalled products on our recall used for other purposes, so a regulation illness with the cause of an illness. data. If there were private recalls due to that reduces search provides measurable Determining the cause of an illness in contaminated supplements that were benefits to consumers. To reduce the small sporadic events is made even not included in our data, the benefits effort devoted to searching, consumers more difficult because only the most from reduced recalls may be of dietary supplements should therefore serious illnesses are likely to be understated. be willing to pay some amount. We lack, reported and because of the difficulty of c. Reduced hypothetical search costs however, a measure of what they would linking the cause of an illness with poor as a measure of the benefit from be willing to pay, partly because some manufacturing practices. Catastrophes increased assurance of quality. consumers may not know that dietary are large but infrequent events that Consumers incur a cost if they purchase supplements may contain more or less create hundreds of illnesses with products but do not get the quality of (or something not even expected) of reporting that is close to complete product they anticipated. Determining what they think they are buying. Indeed, because the public health system the cost they incur is difficult, because if consumers of dietary supplements typically devotes considerable care in we cannot look at the price of poor could determine the quality of these identifying the origin and magnitude of quality products and conclude that products by merely examining the the problem. Adding these two models consumers paid too much, even when product or the label, the market alone should not lead to double counting the they did not get the quality they would be sufficient to ensure that firms health benefits. Double counting would anticipated. We cannot disentangle the responded to consumer preferences for most likely occur if a recalled product price consumers are paying, from the product quality. Consumers would caused both sporadic illnesses and a price they should be paying, because we search for those brands that are more

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likely to have the desired quality, and rule will be the implicit value of the improved mean product quality. We manufacturers would most likely adopt gain in product quality enjoyed by all anticipate little or no change in sufficient quality controls to satisfy consumers. aggregate shopping time for dietary consumer preferences. The market The problem is to measure that gain supplements. response is weak now because only based on hypothetical searches. We We converted the time measure into some consumers know that product needed to use data from searches in a monetary measure by multiplying the quality problems exist, and even these other markets, because we found no time reduction for sophisticated consumers must rely on imperfect information on direct or indirect consumers by the average wage rate. information. If there were uniform searching for minimum dietary The benefits measure reduced search quality control practices throughout the supplement quality standards. For the time associated with improved quality industry that ensured against product sophisticated consumer, we assumed assurance: quality defects, consumers would not that the value of search time should be Quality assurance benefits = reduction have to search for the products that they approximately the same as the in search time (in hours per year) believe are free from contamination or willingness to pay for an attribute of the per sophisticated consumer × have the identity, purity, strength, good. Sophisticated consumers will average wage rate per hour × total quality, and composition they want. hypothetically search until the expected number of consumers. Consumers could more reasonably benefit of continued searching is less The shopping time model is an indirect assume that all products are free from than the expected cost of continued approach to measuring benefits in a contamination and have the identity, searching. The total cost of search time market with asymmetric information; it purity, strength, quality, and will, on average, be no more than the is not a prediction about how shopping composition stated on the label. expected cost of the additional quality behavior will change in that market. We faced the problem of trying to desired. Search time includes the time measure what people would pay for Indeed, we believe that most of the spent: Reading product labels and other beneficiaries of this part of the rule will more uniform products quality if they literature about the product, comparing knew that manufacturing quality never recognize that they are one product with other products, beneficiaries. requirements did not already exist. To examining the product itself (sometimes estimate what people would pay, we Standardization imposes minimum carefully), thinking about the product, requirements on manufacturing, which start with the hypothetical behavior of and second guessing final decisions. It people aware of the lack of uniform in turn should reduce the variance of might also include the time actually product quality. The reduction in product quality; we call these shopping for the product: Finding the hypothetical people the ‘‘sophisticated product quality variation should reduce locations where the product is sold, the amount of information sophisticated consumers.’’ driving there and back, waiting in Sophisticated consumers spend time consumers need to acquire before checkout lines, and walking up and purchasing dietary supplements (Ref. searching for signals about the quality of down the aisles. dietary supplements. The proposed E29). People need not rely as much on We used information on shopping such indicators as brand names, price, CGMP regulations would reduce the times for a range of products to derive amount of search (by some uncertain place of purchase, articles in consumer an estimate for the hypothetical search magazines, or advertising to determine amount) carried out by these consumers. time for dietary supplements. We The benefits of the rule, however, would the likelihood that dietary supplements assumed that some fraction of shopping meet minimum quality standards. not be confined to sophisticated time is pure search time, although we consumers. We also expect ‘‘naive Although no studies deal with dietary also recognize that search time includes supplements directly, the literature on consumers’’ to enjoy the benefits. Naive more than the search for product consumers would incur the costs of consumer search for other commodities quality. Some search time, for example, additional search once the correct or provides insights that increase our is for price, efficacy, and other adverse information about quality is understanding of the search costs for attributes. The reduction in search time available, suffer from worry or an illness supplements (Refs. E30 and E31). for the sophisticated consumer would from taking poor quality products, or Duncan and Olshavsky (Ref. E32) therefore be at most a fraction of total incur the cost of paying for products surveyed buyers of television sets and search time for dietary supplements. that do not meet their needs (Ref. E28). found that 88 percent of respondents The measure of time saved then is: Once good practices are in place they performed some type of search activity would avoid these costs. Naive Reduced search time due to CGMP before purchase. In a study (Ref. E33) of × consumers are those who fail to search regulation = shopping time consumer search for microwave ovens, for quality or search little not because fraction of shopping time spent the average buyer of a new microwave × they do not care but because they do not searching fraction of search time oven was willing to search for four know that quality varies as much as it associated with searches for quality alternative products. Search for × does. In other words, they lack the fraction of search time associated groceries has been characterized as a information that problems exist; if they with searches for quality that would two-stage process (Ref. E34). First, know about the problems, they would be eliminated if CGMP rule people engage in prestore activities, search or be willing to pay more to guaranteed minimum quality. such as reading advertisements, writing ensure that supplements they consume We took the estimated reduction in shopping lists, clipping coupons, and meet minimum quality standards. hypothetical search time for the comparing stores. Second, people Although these naive consumers may sophisticated consumer and applied it engage in search activities at the store, not change their behavior in response to to all consumers to get an estimate of including price and product comparison the proposed CGMP regulation, they the implicit benefits of establishing and search for items with coupons. Most would nonetheless enjoy the benefits. minimum quality standards. This people devote time to search activities The naive consumers, of course, also estimated saving in hypothetical search for all but the most routine purchases. represent real consumers of dietary time is not a forecast of reduced To estimate the reduction in supplements. The total benefits of the shopping time; it is a proxy measure of hypothetical search costs from the quality standards part of the proposed the benefit from reduced variance and proposed rule, we started with estimates

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of the time consumers spend in search • Grocery Store. reveal that adult Americans spent about for groceries and other household We used three models based on 364 minutes per week shopping for purchases (including durable goods). different assumptions because using a personal consumption items, such as We assumed that the search time for range of studies reduced the likelihood groceries and other household products. these products was related to shopping of systematic bias in our analysis. The grocery store model. In the time. Because search costs include the The drug store model. The drug store grocery store study, hidden observers costs of evaluating magazine articles or study recorded the amount of time tracked and recorded shopping time in brochures, the costs of obtaining a people spent looking at an item on the the store (Ref. E38). The study found friend’s advice, and the costs of instore shelf before making a purchase (Ref. that people on average spent about 21 product comparisons, our estimates will E36). Customers, on average, spent 3.75 minutes shopping in the grocery store. not correspond precisely to the actual minutes studying a product before By combining estimated time per trip costs of search for these products (Ref. purchasing it. Although there are with the Food Marketing Institute’s (Ref. E35). We believe, however, that the quality standards in place for over-the- E10) finding that consumers average measure will be a reasonable counter drugs and not for dietary about 2.2 grocery shopping trips per approximation. Although search time supplements, we assumed that this week, we generated an estimate of often takes place outside of measured represented a measure of the amount of search time for all grocery store shopping time, measuring search time time the sophisticated consumer might purchases of 46.2 (= 2.2 × 21) minutes as some proportion of total shopping spend searching for a product with the per week. time should generate a plausible if not desired quality. For each of the models, we needed to a precise estimate. The use of time model. The make assumptions to convert shopping We generated three models of search Americans’ Use of Time Project (Ref. time for other commodities into search time for dietary supplements, based on E37) used time diaries to study how time for dietary supplements. Table 11 three separate studies of shopping time: adults spent all of their time. The study of this document shows the • Drug Store. collected data from over 3,500 adults on assumptions and information used in • Use of Time. use of time. Data from these time diaries each model.

TABLE 11.—THREE MODELS OF SEARCH TIME: ASSUMPTIONS USED IN SIMULATIONS

Variable Value or distribution Source and notes

Drug Store Model

Search time in minutes per item ...... 3.75 ...... Ref. E30. Number of products per person per year ...... 6.57 ...... Ref. E4. Average wage rate ...... $15.65 per hour, or $0.26 per minute ...... Ref. E42. Population ...... 273 million ...... Ref. E19. Fraction of search time devoted to searching 0.2 (based on uniform distribution, 0.1 to 0.3) Based on number of attributes consumers for quality. search for.

Use of Time Model

Weekly shopping time for all items in minutes .. 346 ...... Ref. E37. Fraction percent of budget spent on supple- $15.5 billion/$6,250 billion ...... Ref. E4 and E19. ments. Average wage rate ...... $15.65 per hour, or $0.26 per minute ...... Ref. E42. Adult population ...... 205 million ...... Ref. E19. Ratio of search time to shopping time ...... 0.7 (based on uniform distribution, 0.4 to 1.0) Based on descriptions of shopper behavior. Fraction of search time devoted to searching 0.2 (based on uniform distribution 0.1 to 3.0) Based on number of attributes consumers for quality. search for. Potential reduction in search time attributable to 33% most likely (could be between 15 and Based on likelihood of problem and likelihood CGMP regulations. 50%). that search will decline proportionally, and the expert opinion of pharmacists.

Grocery Store Model

Weekly shopping time for groceries in minutes 46.2 ...... Ref. E38. Ratio of supplement expenditures to grocery $15.5 billion/$710 billion ...... Ref. E38. expenditures. Average wage rate ...... $15.65 per hour, or $0.26 per minute ...... Refs. E4 and E19. Adult population ...... 205 million ...... Ref. E19. Ratio of search time to shopping time ...... 0.7 (based on uniform distribution, 0.4 to 1.0) Based on descriptions of shopper behavior. Fraction of search time devoted to searching 0.2 (based on uniform distribution, 0.1 to 0.3) Based on the number of attributes that con- for quality. sumers search for. Potential reduction in search time attributable to 33% most likely (could be between 1% and Based on likelihood of problem, the likelihood CGMP regulations. 50%). that search will decline proportionally, and the expert opinion of pharmacists.

The drug store data generated a direct could be used to estimate the time total U.S. population to generate an estimate of search time. In the drug store searching for dietary supplements. We estimate of annual search time for model we assumed that the time spent then used data on the number of dietary supplements. standing in front of the drug product products purchased per person and the

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To estimate the time spent searching products, tobacco products, and results for the three models are shown for supplements from the use-of-time smoking supplies. Annual shopping in table 11 of this document. study, we assumed that the share of all time per person for dietary supplements d. Other benefits. The proposed shopping time devoted to supplements would therefore be about 52.5 minutes regulation could also reduce the total would be proportional to the share of a per year (= ($15.5 billion/$710 billion) time and effort that all covered consumer’s budget spent on × 46.2 minutes per week × 52 weeks). establishments expend to monitor supplements. We recognize that it could We again converted shopping time to ingredient suppliers and holders of their well be higher if supplements require search time by assuming that search more search than the average time equaled 40 to 100 percent of products. Because all ingredients and commodity. According to an industry shopping time. Like the estimate from holders would be subject to the same source and FDA projections, consumers the use of time model, this value was uniform minimum requirements, spent about $15.5 billion on dietary then multiplied by 205 million adults. variation in their practices would supplements in 1999 (see table 5 of this We used these three models based on decline, so firm monitoring of upstream document). Consumers spent about different assumptions because we and downstream vendors could decline. $6,250 billion on all personal wanted to explore a range of studies to The provision that requires consumption in 1999, which means that avoid systematic bias in our analysis. establishments to maintain complaints dietary supplements accounted for We recognize that the three estimated files would allow a manufacturer to about 0.24 percent of those annual search times for dietary more readily be able to identify a expenditures. Personal consumption supplements do not represent the search product that causes a significant or expenditures included in this estimate for quality alone. Consumers search for unreasonable risk of illness or injury. are food, alcoholic beverages, a variety of features; only part of every The manufacturer can then take housekeeping supplies (such as laundry search will be devoted to quality. We necessary steps to prevent any and postage), household furnishings and assumed that 10 to 30 percent of pure additional adverse health impact. We equipment (such as furniture and search time involves quality searches. have attempted to quantify this benefit appliances), apparel (includes Estimating the impact of CGMP for preventing catastrophic events, but footwear), personal care products and regulations on consumers’ search time is not for reducing smaller risks. FDA services, reading materials, tobacco difficult, since no previous studies have products, and smoking supplies. Annual analyzed the changes in search time adverse event reports, however, imply shopping time per person for dietary following the adoption of CGMP that many such small events occur, and supplements would therefore be about regulations or from increases in product the proposed rule could prevent some of 44.6 minutes per year (= ($15.5 billion/ quality standardization. However, a them (Ref. E15). $6,250 billion) × 346 minutes per week consistent finding from the literature is In addition, if the same adverse events × 52 weeks). We converted shopping that search time should decline show up in complaints received by time to search time by assuming that following a decrease in the variation in different firms selling products with the search time equaled 40 to 100 percent product quality (Refs. E35 and E40). In same or similar manufacturing of shopping time. Total search time the absence of previous empirical problems, no one firm selling such equaled search time per adult studies, we assumed that the proposed products may recognize the need to multiplied by 205 million adults. We rule would reduce the hypothetical investigate the complaints especially if assumed that all adults would perform search time for quality ‘‘the search time the risk is relatively low. Because we search, although we recognize that not of sophisticated consumers’’ by 1 to 50 would have access to complaint files, all adults consume dietary supplements percent, with 33 percent the most likely our review would be more likely than and not all search is conducted by value. A survey of pharmacists reported any individual firm’s review to identify adults. Children might search for these their belief that 30 percent of their the need to investigate the complaint products also. The opportunity cost for customers place manufacturing quality because of a reasonable possibility of a children, as measured by their wage rate as a top priority in selecting one herbal relationship between the manufacturing is much less than for adults, so we over another (Ref. E41). We also used process of a dietary supplement and the assumed their search time could be evidence from product tests that adverse event. ignored. We used the total adult indicated that up to 33 percent of population rather than just the adult products were missing key ingredients e. Total measured benefits. The total consumers of dietary supplements, or contained unwanted ingredients measured benefits from the proposed because the shopping time studies are (Refs. E25, E26, and E27). If the rule are the sum of the value of health for all adults. proposed rule guarantees that products benefits, the value of the reduced We estimated search time in the will contain what the label claims, then number of product recalls, and the grocery store model with assumptions perhaps search time for quality will reduction in hypothetical search costs. similar to those in the use-of-time decline by that percentage. Table 13 of this document shows the model. We assumed that the ratio of To estimate the value of the possible total benefits. search time for supplements to search reduction in searching for quality, we time for groceries would equal the ratio multiplied our estimated time saving by TABLE 12.—THREE MODELS TO of expenditures on supplements to the average wage rate, which is an ESTIMATED SEARCH COST SAVINGS expenditures on groceries. Estimates estimate of the value of time. The average hourly wage rate for U.S. from the 1998 Consumer Expenditure Baseline model Cost savings Survey (Ref. E39) (adjusted for changes workers was $15.65.7 We ran computer (in millions) in prices between 1998 and 1999) reveal simulations of all three models. The Drug store model ...... $108 that consumers spent approximately Use of time model ...... 101 $710 billion on grocery store purchases 7 Personnel Employment, Hours, and Earnings. Grocery store model ...... 119 in 1999. Grocery store purchases Series ID: EES00510006 Seasonally Adjusted, Industry: Goods-producing Data Type: Average Average of three baseline included food, alcoholic beverages, hourly earnings of production workers, models ...... 109 housekeeping supplies, personal care Employment Cost Index, Bureau of Labor Statistics.

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TABLE 13.—SUMMARY OF ANNUAL the proposed rule requires or microorganisms must be fitted with BENEFITS recommends. We then attached a cost to thermometers to accurately show the each provision that had an activity temperature within the compartments. associated with it. Most provisions did Instruments and devices used in Benefits Mean (in millions) not have costs attached to them, mainly manufacturing must be accurate, because they were either descriptive or adequately maintained, and adequate in Fewer illnesses (from table the costs were included elsewhere. For number. To meet this requirement 8) ...... $39 the rule as a whole, we estimated the establishments might have to purchase Fewer illnesses (from table 10) ...... 66 marginal, or additional costs for over 70 new equipment, replace old equipment, Fewer product recalls (from provisions of the proposed rule. or provide additional maintenance to table 9) ...... 3 We expressed the cost as cost per existing equipment. Reduced consumer search unit, with the unit being either the ii. Production and process controls. (from table 12) ...... 109 establishment, the number of Production and process controls are the employees, or the annual number of main preventive mechanism to ensure Total benefits ...... 218 batches produced. The costs of this the identity, purity, quality, strength, proposed rule included the following and composition in the proposed rule. 7. Costs general activities: Sanitation, Establishments must implement a The same changes in practices that production and process controls, system of production and process produce benefits also have costs, the holding and distributing, and consumer controls that covers all stages of opportunity costs of not doing what complaints. processing, from the receipt and consumers and manufacturers are now b. Costs of general activities. i. acceptance of components, dietary doing. The proposed regulation would Sanitation. Sanitation includes both ingredients, dietary supplements, require dietary supplement one-time capital improvements and packaging, and labels through the establishments to adopt some new ongoing efforts. Some provisions of the release for distribution and holding of practices in order to manufacture, proposed regulation may require the dietary ingredients and dietary package, and hold their products. The establishments to perform one-time supplements. Establishments must costs incurred for those who choose to capital improvements to their physical identify points, steps, or stages in the comply will be for personnel, grounds plant facilities. manufacturing process where control is The proposed regulation would also and physical plant, equipment and necessary to prevent adulteration. require, if not already in place, physical instrumentation controls, quality Establishments must also establish plant owners to install new or specifications for the identity, quality, control and laboratory operations, additional plumbing systems to carry purity, strength, and composition of production and process controls, additional water or sewage, additional components, dietary ingredients, or handling consumer complaints, and toilet or hand washing facilities, dietary supplements. Establishments holding. In some cases, establishments additional facilities for trash disposal, or must monitor the points, steps, or stages would need to make capital new signs to instruct employees. The in the batch production, as specified in improvements to the physical plant, add proposed regulations might also require the master manufacturing record, where or replace equipment or controls, establishments to add space in order to control is necessary to prevent perform additional maintenance, keep keep equipment and materials farther adulteration. Establishments must records, carry out tests, or execute a apart, which will help to prevent establish specifications for packaging to variety of additional tasks that they may contamination or mixups. Other ensure that containers or closures that not have previously performed. We possible capital expenditures (among come into contact with dietary estimated the additional costs of many other possible requirements) ingredients or dietary supplements are production associated with the include: not reactive or absorptive and are proposed rule and the leading • Replacing floors, walls, or ceilings composed of substances that are safe for regulatory options, using the survey with smooth, hard surfaces; use in or on food. (Ref. E2) to estimate baseline • Changing fixtures, ducts, or pipes Establishments that have not already manufacturing practices. that might be a source of contamination done so must establish a quality control a. Description of the costs. To estimate by dripping or condensation; unit with one or more individuals that costs for the dietary supplement • Adopting ventilation control have with the authority and industry, we initially divided the systems including filters, fans, or other responsibility to review the results of industry into four product categories air-blowing equipment to prevent odors monitoring, make decisions on the and three size categories. Because the or vapors; disposition of materials, and identify survey showed that there were only a • Additional lighting to ensure that whether actions taken to correct any few establishments in some categories, equipment, contact surfaces, or other deviations are appropriate. The quality we consolidated the size and product areas where supplements are examined, control operation must ensure that into three size categories. The size processed, or held can be adequately components, dietary ingredients, and categories were: seen. dietary supplements conform to • Very small (fewer than 20 Sanitation also requires that specifications. employees). equipment utensils must be of suitable iii. Holding and distributing. • Small (20 to 499 employees). design, construction, and workmanship Establishments must hold and distribute • Large (500 or more). to enable them to be adequately cleaned dietary ingredients and dietary Although this consolidation glosses and maintained. To meet this supplements under appropriate over the important differences across requirement, some establishments may conditions of temperature, humidity, products, the purpose is to estimate the need to provide additional maintenance and light so that the identity, quality, broad average costs of the rule. or additional cleaning and sanitation for purity, strength, and composition of the For each category, we constructed a their equipment and utensils. Also, dietary ingredients and dietary cost model that included every freezers and cold storage compartments supplements are not affected. provision of the CGMP regulations that used to slow or arrest the growth of Establishments must also identify and

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hold components, in-process materials, are measured by the workers’ wage rate, costs to develop tests, for the number of and dietary supplements under which we assumed is $15.65 per hour tests and the costs for performing each conditions that will protect them against based on the average manufacturing test to comply with this requirement. mixups and physical, chemical, and wage, multiplied by the expected labor • Number of tests: Model. To estimate microbial contamination. Packaging hours necessary to perform a written or the costs of testing, we first estimated materials must also be protected against electronic record and the time necessary the number and costs of individual deterioration. Establishments that do for management to review the records to tests, without adjusting for the amount not now perform these requirements see the actions are documented of testing already being done. In this and the other provisions associated with accurately. For electronic records, the section we show how we estimated the holding will incur a compliance cost. recurring time is the time necessary to likely number of required tests, iv. Consumer complaints. The quality ensure that the equipment is serviced unadjusted for current voluntary testing. control unit must review all consumer and maintained properly. For a representative manufacturer, the complaints involving the failure of a ii. Capital costs for physical plant and annual number of tests would be the dietary supplement to meet any of its equipment. We estimated capital costs number of new tests per batch specifications, or the failure to meet any for physical plant redesign at $50 per multiplied by the number of batches other requirements under proposed part square foot (Ref. E45). For produced in a year. 111, including those specifications and establishments with inadequate The proposed rule requires only tests facilities, we assumed that between 0 other requirements that, if not met, may for identity, purity, quality, strength, and 20 percent of the physical plant result in possible illness or injury. In and composition of the final product. would have to be renovated, with 10 addition, the quality control unit must The option for stricter CGMP percent the most likely. For equipment investigate such a consumer complaint regulations would also require tests of costs, we assumed that very small where there is a reasonable possibility components. Estimating the number of establishments would on average spend of a relationship between the component tests per batch is 0 to $1,000, with $100 the most likely consumption of a dietary supplement complicated, because component tests amount. Small establishments would and an adverse event. The complaint are made on the shipment lots, rather bear costs 3 times that of very small and report of the investigation results than on the parts of the lots that actually establishments, which is the ratio of the should be reported to FDA when there go into the final product. For example, size of the physical plants of small is a possibility of a serious adverse if a lot of some ingredient is used in 6 establishments to the size of the event. batches of final products, it would physical plants of very small c. Major costs by type of activity. probably be tested only once. Within these four categories (sanitation, establishments. We assumed that large The establishment itself may test the production and process controls, establishments would bear (if necessary) shipment lots, and during inprocess holding and distributing, consumer costs 20 times that of very small stages for identity, purity, quality, complaints), the major costs of the establishments, which is the ratio of the strength, and composition, unless final proposed rule are recordkeeping (except size of the physical plants of large product testing is done. for sanitation), capital costs for physical establishments to the size of the plant and equipment, finished product physical plants of very small The number of component tests per quality testing (part of production and establishments. In other words, we batch of final product would equal the process controls only), labor costs for assumed capital costs for physical plant number of tests per component, certain required tasks, and some other and equipment would be proportional multiplied by the number of costs that were not easily classified. to facility size, as measured in square components per batch, divided by the i. Recordkeeping. We used a study of feet. batches per shipment lot (to account for a medical device CGMP regulation to iii. Testing. Establishments that do the production of multiple batches of estimate the costs of recordkeeping (Ref. not already conduct the required dietary supplements from single lots of E44). We request comments on the product quality tests of each batch of components). applicability of a study of the medical dietary ingredients or dietary The option for stricter CGMP device CGMP’s to dietary supplements. supplement produced would incur the regulations options would also require The compliance cost of recordkeeping cost for those tests. Under the option for some inprocess tests upon receipt. The is the sum of both the initial design and more restrictive CGMP rules, each lot of number of inprocess tests per batch is printing of the recordkeeping components would also be tested. The the same as the number of potential documents and the recurring costs of costs per establishment depend on both inprocess product defects. The maintaining the records. The cost of the number of tests and the costs per estimated number of inprocess tests training personnel to use mandatory test. We did not estimate the cost of counts only tests for defects that can records is a recurring cost that depends developing new, validated tests occur during production, not tests for on how frequently records are modified, methods because we lacked information the defects of dietary ingredients and the frequency of personnel turnover, about the costs for this requirement and components supplied to the producer. and how complicated the tasks are that the number of such tests that need to be We used the following formulas to are being recorded. The recurring costs developed. We ask for comments on the estimate the number of tests:

  Component test per batch =∑ m ()IR× +×∑ n () U R× (/) SB  j jkj kk o × Inprocess quality tests per batch = ∑ 1 ()HR11

Quality tests per batch of final product Where: m = number of ingredients per batch; = max [m × (1/z), 1] Ij = jth listed ingredient; Rj = required tests for ingredient j;

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Uk = kth unlisted component (an tests per listed dietary ingredient would establishments produce an average of inactive substance); be between one and six: One identity 309 batches per year. n = number of unlisted components per test for identity, purity, strength, • Inprocess potential defects. batch; quality, and composition and zero to Inprocess defects involve many of the Rk = required tests for unlisted five tests for defects. same potential defects that can occur in component k; • Number of unlisted components. components. The more restrictive CGMP S = number of shipments (or lots) of Dietary supplements are manufactured option requires inprocess tests at all ingredients and unlisted using solvents, binders, and lubricants points where contamination or other components; that may not show up in the final defects can occur. Filth, chemicals, B = number of batches produced; product. An industry source (Ref. E47) microbial pathogens, physical objects, H1 = 1th inprocess potential defects; says that four to six unlisted and insects can be introduced into the R1 = required inprocess tests per batch components are typical per product, product during manufacturing. In for potential defect H1; although fewer are certainly possible. addition, purity, quality, strength, and o = number of potential inprocess The minimum number is zero. We composition can be compromised. • defects per batch; assumed that the number of unlisted Number of potential inprocess z = number of ingredients identified per components would be zero to six, with defects. Some processes may have no quality test. four the most likely. control points, steps, or stages that • Number of tests per unlisted involve the potential for defects. If • Number of tests: Evidence and components. The unlisted components certain manufacturing processes in the distributions. The quantity and quality tend to be manufactured products, such production of a dietary supplement can of evidence on the variables used to as solvents. Therefore, one identity test be carried out without being subject to estimate the number of required tests would likely be sufficient. potential defects, no inprocess tests varies greatly. In this section, we • Number of shipments (or lots) of would be required for those processes. explain the evidence and assumptions ingredients and unlisted components. We therefore assumed that zero we used to construct the formulas for We have no direct evidence on the inprocess tests would be the lower the number of tests. • number of shipment lots of dietary bound requirement. For the upper Number of ingredients. We based ingredients and components. We also bound, we assumed that no products our measure of the number of dietary have no evidence on the number of would have more than five potential ingredients per product on a sample of shipments per lot or on the number of control points or steps that could lead almost 3,000 dietary supplement labels shipments per batch. The increasing use to defects. We believe that most (Ref. E46). Although some dietary of just-in-time inventory practices production processes will have fewer ingredients may be missing from the indicates that one shipment lot of than 5 control points, so we assumed an labels and some listed dietary components per batch may be the rule average of 2.5 control points requiring ingredients may be missing from the for some products and some producers. inprocess tests for defects. products, the ingredient list represents It is costly and difficult to store • Number of required inprocess tests the best evidence we are likely to have ingredients for an extended time, so per control point. We assumed one test on what dietary ingredients are used in establishments tend to buy more and per defect per control point. dietary supplements. smaller lots of components rather than • Number of ingredients identified • Number of ingredients per batch. a few large lots and storing them in bulk per quality test. We had no direct According to the sample of listed over an extended period (Ref. E48). evidence on the number of identity tests ingredients (Ref. E46). Vitamin and Crude botanical and other ingredients per final dietary supplement. For the mineral products contain about 13 listed are inherently unstable and may lose maximum, we assumed that the number ingredients. Other dietary supplements, their quality in even a short time unless of tests would equal the number of mainly herbals, contain about four. costly temperature, humidity, and light ingredients. The number of ingredients • Number of tests per ingredient lot. controls are in place (Ref. E49). We also identified per test varies from less than The option for more restrictive CGMP know, however, that some dietary one to a very large number. We assumed regulations would require that virtually ingredient suppliers produce large that for vitamins and minerals, the all dietary ingredients be tested for amounts and then ship out smaller minimum number of identity tests identity and defects at some stage packages. For dietary supplements would be one and the maximum would between harvesting the raw product and produced using part of a large be 30, with 2 the most likely. Botanical the beginning of the production of the production run of a dietary ingredient, and herbals are less easily characterized final product. We assumed one identity the number of batches per lot could be than vitamins; so identifying large test per ingredient lot. The number of large. Also, some producers buy a single numbers of ingredients with a single test tests for defects depends on the number shipment lot of a raw material and use would be highly unlikely. We assumed of possible defects, which can include: it in many batches. We assume that as that one to two ingredients would be Filth; Microbial pathogens; Chemical many as 12 batches per shipment lot of identified per test for herbal products. hazards, including pesticides; Insects; dietary ingredient is a plausible • Number of final product tests per Physical hazards, such as metals; maximum. In the cost calculation, we batch. We had no direct evidence on the Natural toxins, such as aflatoxin; and assumed that 1 was minimum and 12 number of quality tests per final dietary Inadequate purity, quality, strength, or the maximum number of batches supplement. After adjusting for the composition. produced per lot, with 6.5 the average. possibility of multiple results from a The number of potential defects is • Number of batches produced. We single test, multiple ingredients in potentially unlimited. As a practical have survey results (Ref. E2) on the single products, and the differing maximum, however, few products number of batches produced per number of ingredients in herbal and would have more than five potential establishment. According to the survey, vitamin products, we estimated that the defects. In the calculation of ingredient very small establishments produce an proposed rule would require about three testing costs (part of the option for more average of 223 batches per year, small tests for identity, purity, quality, restrictive CGMP regulations), we establishments produce an average of strength, and composition for each assumed that the average number of 554 batches per year, and large batch of final product. These are the

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only required tests in the proposed rule, prices fell into the $20 to $80 range, so We estimate that the adjusted total but establishments may choose to we selected $50 (the midpoint) as most cost for testing for the proposed perform inprocess tests and tests on likely. The average cost per test was regulation will be: ingredients in order to prevent waiting 8 about $60. $11,230 for very small establishments; until final product testing to discover Changing our assumption about the defects. midpoint of testing costs would change $19,907 for small establishments; iv. Costs per test. We estimated the our estimate of the cost of the rule. If the $7,626 for large establishments. costs per test partly with published cost of testing each batch is actually We found some corroboration for prices of independent laboratories as significantly higher, then the impact to these estimates in a comment on the posted on the Internet (Refs. E50 and those firms that incur the cost and to Advance Notice of Proposed E51), and partly from our conversations society will have been understated. Rulemaking entitled ‘‘Current Good with FDA and industry experts on v. The number and cost of tests: Manufacturing Practice in testing. We found that testing costs vary summary. We estimated the number of Manufacturing, Packing, or Holding according to frequency and complexity. tests required of the representative Dietary Supplements’’ published in the The more frequently technicians manufacturer as a weighted average of Federal Register of February 6, 1997 (62 perform tests, the lower are the costs per the number of tests required for FR 5699 to 5709). According to the test. Many tests require sophisticated vitamins and minerals and the number comment, the cost of testing equipment, such as gas chromatography, of tests required for all other components and final products inhouse high pressure liquid chromatography, supplements (which were mainly herbal would be at least $650 per batch plus distillation, extraction, various products). We used survey responses to microbiological tests. Testing costs spectrophotometers, and other types of a question about the establishment’s could be more if establishments sent equipment. Using sophisticated primary line of business for the weights samples to independent laboratories for equipment requires trained personnel. used to compute the average number of testing or if they conducted extensive Even simple physical or organoleptic tests. We dealt with multiple responses identity tests of herbal and botanical testing requires training or experienced by treating all nonvitamin and products. If we apply the $650 to the personnel. The type of ingredient, nonmineral responses as other dietary annual number of batches per compound, or product can also affect supplements. The following weights, as establishment, the comment implies the cost because some are easily shown below, differed by size of identified using routine or single step that very small establishments would manufacturer: × techniques and others require multiple • 24 percent of very small perform $145,000 (223 $650) worth of steps or complex techniques, especially tests, small establishments would manufacturers produce vitamins and × if there are similar products that can be minerals; 76 percent produce other perform $360,000 (554 $650) worth of mistaken for the products being tests, and large establishments would dietary supplements. × identified. The type of defect tested for • 42 percent of small manufacturers perform $200,000 (309 $650) worth of affects the cost; some defects can be produce vitamins and minerals; 58 tests. These estimates are reasonably found visually if they are found on the percent produce other dietary close to our simulation estimate. surface, but others are latent. Some tests supplements. The unadjusted testing costs represent require multiple samples or multiple • 69 percent of large manufacturers the total requirements and steps. In addition, tests require the produce vitamins and minerals; 31 recommendations, not the additional taking and of samples, whose cost can percent produce other dietary costs that would be incurred in response vary. supplements. to the proposed rule. Tests on incoming We assumed that $20 per test The annual cost of testing differed by components and inprocess tests would represented a plausible lower bound. the size of the firm, because the average not be required by the proposed rule. This cost represents the full cost of number of batches produced differed. Most establishments already conduct carrying out a test, including collecting For the option calling for more strict some tests, or send samples out for and storing the sample, the time for regulation, the total costs of testing testing. We, therefore, adjusted the training the personnel who carry out the would be much higher than in the estimated testing costs of the proposed test, and any associated records. proposed rule. The unadjusted total cost rule to include only required tests and Although some Internet testing prices of testing under the more restrictive to account for the testing costs currently for tests were as high as $300, we CGMP option would be: borne voluntarily by manufacturers. The assumed that with frequent testing $150 $148,000 for very small establishments; survey results showed how many would be a more plausible upper bound $415,000 for small establishments; respondents were conducting various average cost. The majority of listed $263,000 for large establishments. types of tests.

TABLE 14.—VALUES USED IN TESTING COST CALCULATIONS

Name Value or distribution used Source

Number of dietary ingredients per product batch Vitamins and minerals—13; All other Sample from 3,000 dietary supplement labels categories—4. (Ref. E46).

8 The average cost is higher than the most likely is p. The Beta shows the distribution of the value 6. We used the Beta-Pert distribution because we cost because we modeled costs with a Beta-Pert of p when s successes occur in n trials. The Beta- did not have a representative sample to derive the distribution that was skewed rightward (toward Pert distribution is a Beta distribution that has been distribution, but we did have enough information higher costs). The Beta distribution is part of the rescaled to run between values other than 0 and 1. to identify a plausible maximum, minimum, and Bernoulli family of distributions and is closely The Beta-Pert uses a minimum, maximum, and most likely value. The use of the Beta-Pert, then, related to the Binomial. The Binomial gives the most likely value to generate a distribution running indicates that we do not know the shape of the distribution of the number of successes (s) in n from the minimum to the maximum, with a mean probability distribution of possible testing costs, but trials if the probability of the success in each trial equal to (minimum + (4 × most likely) + maximum)/ we do have limited data.

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TABLE 14.—VALUES USED IN TESTING COST CALCULATIONS—Continued

Name Value or distribution used Source

Number of identify tests per ingredient lot ...... 1 Identity test per ingredient lot ...... Assumption based on discussions with industry—FDA requests comments. Number of tests for defects per ingredient lot ... 0 to 5 tests for defects ...... Assumption based on discussions with industry—FDA request comments. Number of unlisted components ...... 0 to 6 components; 4 most likely ...... Ref. E47. Number of tests per unlisted components ...... 1 identity test per component ...... Assumption based on discusssions with industry—FDA requests comments. Number of shipments (Lots) of ingredients and 1 to 12 batches per shipment lot of dietary in- Assumption based on discussions with unlisted components. gredients. industry—FDA requests comments (Ref. E48). Number of batches produced ...... Very small establishments—223; Small Ref. E2. establishments—554; Large—309. Number of inprocess potential defects ...... 0 to 5 potential control points; 2.5 average ..... Assumption based on discussions with industry—FDA requests comments. Number of inprocess tests per control point ...... 1 test per defect per control point ...... Assumption based on discussions with industry—FDA requests comments. Number of ingredients identified per identity test Vitamins and minerals—1 to 30; 2 most likely; Assumption based on discussions with All other categories—1 to 2. industry—FDA requests comments. Number of final product tests per batch ...... 3 tests batch ...... Assumption based on discussions with industry—FDA requests comments. Costs per test ...... Beta per distribution skewed rightward be- Refs. E50 and E51. tween $20 to $150; $50 most likely; $60 av- erage.

vi. Labor costs. We used the average assumptions about the full cost of a establishments in each size category manufacturing wage of $15.65 per hour provision. We then adjusted these (from the survey) by the average costs to estimate the cost of labor. We estimates to account for the many per establishment in that category. We assumed that various tasks required by activities already being carried out, as then adjusted for the establishments that the proposed rule would take some well other activities that would not have did not respond to the survey but are number of hours per year, per batch of to be carried out by all establishments. believed to be in the industry. Two product, or per square foot of physical We used the survey to estimate the hundred thirty eight establishments plant. For example, we assumed that likelihood that an establishment would responded to the survey; we estimated time spent on the sanitation of physical incur a cost. To get an estimate of the that 1,566 firms are in the industry. We plants is a function of the square average cost of provision (adjusted for estimated costs with the following footage. We assumed 1 hour per week baseline activities) for each category, we calculation: for very small establishments, 3 hours multiplied the average cost per [Number of very small establishments × per week for small establishments, and establishment by the probability that the costs per very small establishment) 20 hours per week for large establishment would need to undertake + (Number of small establishments establishments. We request comment or the expense (one minus the probability × costs per small establishment) + data about costs, hours, and the other that the establishment was already (number of large establishments × requirements for these proposed doing it). For each provision of the costs per large establishment)] × required procedures. proposed rule, the simulation carried vii. Other costs. The main costs in this out the following calculation: adjustment for establishments not category are for pest and rodent control. Cost per unit of analysis for each in survey We consulted a commercial supplier of provision = number of units of analysis The rule is complex and the industry is these services for the estimated monthly per establishment × probability that made up of very different kinds of firms, costs, which were $400 to $600 a month establishment incurs cost × adjustment so cost estimates are averages with, in for very small establishments, $480 to for requirement (yes or no) = cost per some cases, large variances. The cost per $720 for small establishments, and $700 provision per establishment unit, number of batches and employees, to $1,000 for large establishments (Ref. We estimated both a setup cost (a one- and probability that the establishment E52). For each size of establishment, we time fixed cost) of the provision and an would incur the cost all contain selected the midpoint of the range as the annual recurring cost. The first-year uncertainty. The values in table 15 of most likely value. costs would be the setup costs plus the this document are used in the cost d. Estimating costs. We initially annual costs. To get the total costs of the estimates, and are generated from gathered information and made rule, we multiplied the number of multiple sources.

TABLE 15.—VALUES USED IN COST CALCULATIONS

Name Value or distribution used Source

Average wage per hour ...... $15.65 ...... Employment Index, Bureau of Labor Statis- tics. Average size of establishments in square feet .. Very small = 24,674; small = 71,354; large = Ref. E2. 596,000. Average number of employees ...... Very small = 7.6; small = 95; large = 1,005 .... Ref. E2. Average annual number of batches ...... Very small = 223; small = 554; large = 309 .... Ref. E44.

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TABLE 15.—VALUES USED IN COST CALCULATIONS—Continued

Name Value or distribution used Source

Annual time recordkeeping ...... 1/10 of setup time per provision ...... Ref. E44. Personnel sanitation ...... 1 hour per week per worker ...... Assumption, based on requirements of pro- posed rule. Sanitation time for physical plant ...... 1 hour per week for very small establish- Assumption, based on difference in average ments; 3 hours per week for small estab- physical plant size. lishments; 20 hours for physical plant per week for large establishments. Sanitation supervisor ...... Very small and small establishments = 1 hour Assumption, based on number of workers. per week; large establishments = 1 hour per week. Pest control setup costs ...... $1,500 to $2,000 for very small establish- Ref. E52. ments; $1,800 to $2,400 for small establish- ments; $2,600 to $3,400 for large establish- ments. Average for each size establishment was midpoint ($1,750, $2,100, $3,000). Pest control annual costs ...... $400 to $600 per month for very small estab- Ref. E52. lishments; $480 to $720 for small establish- ments; $700 to $1,000 for large establish- ments. Average for each size establishment was the midpoint ($500, $600, $850). Renovation cost ...... $50 per square foot; with 0 to 20 percent of Based on construction costs and square feet. physical plant to be renovated, with 10 per- cent most likely. Minimum quality control unit ...... 1 person or 1 percent of establishment work Assumption based on requirements of pro- force. posed rule. Equipment replacement ...... For very small establishments, 0 to $1,000, Assumption, based on size of establishments. with $100 most likely; small, 0 to $10,000, with $1,000 most likely; large, 0 to $100,000 with $1,000 most likely. Setup costs for automatic equipment ...... $500 for hardware, 16 hours ...... Software costs and assumptions about labor hours. Annual costs for automatic equipment ...... 1 to 2 hours per month for very small and Assumption based on average size of estab- small establishments; 2 to 4 hours per lishments. month for large establishments. Sanitation of equipment and surfaces...... 5 hours per week for very small establish- Assumption based on average sizes of estab- ments, 15 hours per week for small estab- lishments. lishments, 100 hours per week for large es- tablishments. Number of dietary ingredients per batch, sup- 12.8; standard deviation = 15.6 ...... Ref. E46. plements other than vitamins. Number of dietary ingredients per batch, sup- 3.6; standard deviation = 4.8 ...... Ref. E46. plements other than vitamins. Cost per test ...... $20 to $150, with $50 most likely ...... See text discussion. Holding products and dietary ingredients: cap- Setup cost for very small 0 to $1,000, with Based on average sizes of establishments. ital requirements. $100 most likely. Multiply by 3 for small es- tablishments and by 20 for large establish- ments. Default probabilities that establishments are not For very small establishments, 0.2; for small Based on results of survey for other practices. currently acting in accordance with a provi- establishments, 0.1, for large establish- sion. ments, 0.01.

We combined the costs per rule. Table 16 of this document first year and annually after the first establishment with the number of summarizes the estimated total costs for year, assuming that the proposed rule is establishments and probabilities from very small establishments, small phased in over 3 years. Table 18 of this the survey, and adjusted for establishments, large establishments, document shows the total costs of the establishments not in the survey to and warehouses. Table 17 of this proposed rule compared to the total estimate the total costs of the proposed document shows the total costs for the costs of other options.

TABLE 16.—SUMMARY OF COSTS BY SIZE OF ESTABLISHMENT

1st Year costs Annual costs Total 1st Total annual Number of per per year costs costs establishments establishments establishments (in millions) (in millions)

Very small establishments ...... 740 $62,000 $38,000 $46 $28 Small establishments ...... 766 99,000 61,000 76 47 Large establishments ...... 60 83,000 47,000 5 3 Warehouses and other holders ...... 26,617 436 342 12 9

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TABLE 17.—ESTIMATED TOTAL COSTS [In millions]

4th Year 1st Year 2nd Year 3rd Year and after

Very small establishments ...... 0 0 $46 $28 Small establishments ...... 0 $76 47 47 Large establishments ...... 5 3 3 3 Warehouses ...... 12 9 9 9

Total ...... 17 88 105 87

8. Summary of Benefits and Costs recall benefit, which is based directly on is in turn based on: (1) The value of a We estimated that, once it is fully FDA recall records, each component of statistical life of $5 million; (2) the implemented, the measured annual the estimated benefits involves expected remaining life of consumers of benefits from the proposed rule would assumptions that reflect our uncertainty. 21.84 years (average), discounted from Our basic assumption is that be $218 million; measured annual costs 36 years; and, (3) the social rate of time manufacturers lack market-based preference of 3 percent. The estimate is would be about $86 million. Additional incentives to prevent hidden product derived from workers in somewhat risky but unmeasured benefits should also be quality defects. Our survey (Ref. E2) occupations who demand a wage recognized when comparing the total indicated that many firms do not have premium for their additional risk of costs and benefits. Table 18 of this reliable quality control mechanisms in fatality. If our estimate of the value of document compares the benefits and place. The survey was a one-time look a statistical life of workers does not costs of the proposed rule to the benefits at the manufacturing practices during represent the value of a statistical life of and costs of the leading regulatory the time of the survey. If the trend in the consumers of dietary supplements, then options. Because the phase in period, market is toward the adoption of the our benefits estimate will be different complicates the comparison for the controls that we are proposing here in from the true health benefits of the rule. early years, we limit the comparison to the absence of regulation, then both the If consumers value their life differently annual benefits once all establishments cost and benefits of the rule will be less than workers or if consumers place are covered. than we estimate. If the market-based different values for different kinds of trend is toward fewer controls, then hazard-related deaths than do workers TABLE 18.—ANNUAL BENFITS AND both the cost and benefits of the for job-related safety hazards, then we COSTS OF REGULATORY OPTIONS regulation will be greater. Other key will have incorrect estimates for the true [In millions] assumptions are listed below: health benefits. If we discount life The assumptions for the health expectancy by 7 percent instead of 3 Regulatory Annual Annual benefits from reducing the number of percent, the benefits would be much option benefits costs sporadic illnesses model are: higher. Proposed rule ... $218 $86 1. The baseline health of consumers is 3. There is one illness for each recall. Fewer require- normal, not perfect. To estimate the We assumed that for each class 1 and 2 ments for vita- change in health status from consuming recalled product there was only one mins and min- defective products, we assumed that the illness that was reported to the public erals ...... 109 69 baseline health of consumers is normal, health authority. For instance, if a Stricter CGMP .. 218 178 which does not mean that we assumed product was recalled because the HACCP only ..... 42 38 that consumers have perfect health. We defective product contained lead, we Testing only (un- recognize that consumers will already assume that a person was made ill from able to esti- mate) ...... 32 have ‘‘background’’ health problems, by lead poisoning and that was how the High risk prod- which we mean that many will have recalled product was discovered. If ucts only (un- health problems unrelated to the there were more illnesses per recall than able to esti- consumption of defective products. Our one, then our estimates of benefits will mate) ...... (1) assumption is that only the change in be low. If fewer than one illness per health status is relevant for our analysis. recall occurred (or is likely to occur in 1 Less than $86 million. If an immune-compromised consumer is the future), then our estimate of health Uncertainties in the analysis. In this made ill by a defective product, e.g., benefits will be more than the actual section, we list all of the significant gets lead poisoning, the consumer might health benefits. assumptions in the analysis, which if in fact have more difficulty recovering 4. The assumed frequency of actual varied, could significantly change the than an otherwise healthy person. illnesses is 100 times the frequency of estimates of costs and benefits. Such However, we assume that the change in reported illnesses. This assumption is changes could have importance for the productivity, functional state, pain and based on Ref. E16. We recognize that the construction of any potential final rule. suffering, and medical costs will be the factor of 100, although it has empirical Therefore, we ask that comments same, regardless of prior health status. support, might be wrong and that there address these aspects of the analysis Accounting for confounding factors is likely to be considerable uncertainty and, where possible, provide FDA with would have the effect of making health about this point estimate. It is widely better data to reduce the uncertainty. problems worse than we estimate, not believed in the public health We estimated the benefits using indirect better, so our estimate may be community that most illnesses are methods, which required several key understating the true health benefits. underreported to public health assumptions that are critical for our 2. The average value of a QALY is authorities, particularly in passive estimates. With the exception of the $630 per day. That value, $630 per day, reporting systems, such as the case with

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dietary supplements. Mild cases are the there would be no benefit from adopting preferences for dietary supplement most underreported. For instance, a rule to avoid it. If a rare event would quality. With the adoption of the victims rarely notify public health have happened more frequently than proposed rule, the standardization of authorities when they have minor our estimate of once every 30 years, manufacturing practices will reduce gastrointestinal tract related illnesses. It then our estimate of the benefits would product differentiation. In a perfect is even more rare to report the likely underestimate the true health benefits. information market, the change in source of a mild illness. It is also widely 2. Number of illnesses per rare event. product differentiation would be believed that severe illnesses and death We based our estimate of the health reflected in the change in the price are reported much more frequently than impact from contaminated L- differences between low and high milder illnesses, even when the cause of Tryptophan. If the number of illnesses quality products. In the existing market, illness or death is not included in the from a future rare event differed—either price differences alone are an report. Although the number of deaths more or less—then the health benefits inadequate signal because the that are reported probably approach 100 would differ from our estimated differences in product quality are percent, the cause of death from a benefits. If a future event would have typically hidden from the view of both contaminated dietary supplement had 10,000 cases, not 1,500 cases, then consumers and (though less so) product might not be reported. We our estimate would understate the true manufacturers. In this hypothetical believe that using a single composite health benefits of avoiding such a large model, we assumed that if there were factor—100—to represent the total catastrophe. actually indicators of product quality in number of all unreported cases, The assumptions for fewer products the market now, consumers would including mild, severe, and death, does recalled are: spend a certain amount of time not invalidate our assumption. The 1. The reported class 1 and 2 recalls attempting to find a reasonably high factor of 100 represents an estimate of that have occurred over the last 10 years quality product. Time spent searching is the composite probability of the full represent the number and type of recalls an economic cost. In fact, in markets range of probabilities for each severity that would have occurred in the future where quality is discernible prior to level of an illness being reported. but for the implementation of this purchase, such search does take place Increasing the factor multiplier from 100 regulation. If the number or types of and it is from those markets that our to some number higher would increase recalls are not representative, then we estimates were derived. In such a world the health benefits, while lowering the over or under estimated the benefit of of easily available product quality multiplier would decrease the health avoiding recalls. Avoiding one very signals, this regulation, by standardizing benefits. If we assume that all illnesses large recall could result in significantly product quality at the high end, would are reported—there are no unreported higher benefits. Conversely, merely reduce that search time. Our assumption illnesses and no factor of 100, then the avoiding fewer or smaller recalls would is that this is a reasonable indicator of health benefits from fewer sporadic result in smaller benefits. consumers’ value for high quality illnesses will be less than $1 million. 2. A product recall causes sellers to products. Further, we assume that in 5. Introducing CGMP’s will reduce the lose both goodwill and the value of the fact consumers of dietary supplements probability of a recall to zero. We recalled product and lost goodwill do wish to purchase high quality believe that the proposed CGMP’s equals the value of the recalled product. products, as the absence of quality creates the most reliable means for These two embedded assumptions have could mean either an ineffective discovering product adulteration. empirical support from Ref. E24. A product or worse, illness or death. We Indeed, we believe that it will, if strictly product recall adversely affects the used various assumptions at each step used, cause the discovery of all wealth of sellers—a recall leads to lost in our model, and the benefits change adulteration. Therefore, we assume that goodwill—by signaling to consumers when the assumptions change. The once an establishment fully adopts the that products are defective. From assumptions that we used for the search requirements, there should be no more evaluating the declines in public share model are: health risk from adulterated dietary prices after product recalls in various 1. Consumers will search until the supplements and consequently, no more industries, the authors in Ref. E24 expected benefits of the search equal the class 1 and 2 recalls. This conclusion determined that the loss in share price expected cost of additional search. The rests on the assumption that there will is twice the value of the loss of the expected cost is the value of their time, be 100 percent compliance with this actual value of the product recalled. which we estimated is the average wage regulation. We recognize that human They attribute the difference to lost firm rate for manufacturing workers—$15.65/ error is inescapable. If recalls—or a goodwill. hour. If the true wage rate is different, health risk from adulteration—would 3. Full compliance with the proposed the benefits of the rule will be different. still exist, then we overstated the true CGMP’s will reduce the probability of a 2. The three models—drug store, use health benefits of the regulation. recall to zero. As in our earlier of time and grocery store models— The assumptions for the health assumption about the probability of represent consumers of dietary benefits from lowering the likelihood of recalls after the rule is adopted, supplements. If not, then we will not rare catastrophic event model are: consistency requires that if we believe have estimated the true preferences of 1. We assume that a rare catastrophic that the rule will reliably cause the consumers. If consumers value dietary event would occur every 30 years. We discovery of adulterated products before supplements more highly than either recognize that the occurrence of a single they are commercially available, there drugs, groceries or other uses of time, event provides little evidence about should be no more health risk from and they search more for better quality, what will happen in the future. If the adulterated dietary supplements. then we understated the benefits of event reported in this analysis was in Consequently, there should be no more product standardization. If consumers fact a one-time occurrence, then our recalls. value dietary supplements less highly estimate of the benefits from the We developed the hypothetical search than either drugs, they search more for prevention of the catastrophic health model to estimate the implicit value to better quality, then we overstated the event would overstate the true benefits, consumers of better product quality benefits. which in fact should be zero. There although we lacked a model that could 3. The quality controls will reduce would have been no future event, and enable us to directly estimate consumer consumer search time by approximately

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33 percent. If our estimate is not practices that create defective products. percent, then the benefits of representative of the true average Recordkeeping ensures that preventative recordkeeping would be $25 million. reduction, then our estimate will be controls are carried out for each batch We were not able to quantify the wrong. of dietary supplements produced. marginal benefits of this requirement 4. The type and number of consumers Records serve as a checklist that quality with numbers like this. Comments are represent the true value. If children, the control personnel can consult to requested for how well records are elderly or other consumers search for monitor that necessary controls are likely to perform this function. We these products in significantly greater implemented or corrective actions estimate that the additional cost to amounts than average workers or the taken. Further, mandatory society for the proposed new estimated population, then we may have recordkeeping provides an incentive for recordkeeping requirement will be overstated the benefits, because their manufacturers to comply more fully foregone wages would be less than that approximately 10 percent of the total with the provisions of the rule where annual cost of the proposed regulation, of average workers. recordkeeping is required. Knowing that In an ideal analysis, the benefits and or a little less than $9 million per year. FDA inspectors will examine records costs of each provision would be Further, we request comments on all and that falsifying them is a criminal evaluated. We were not able to quantify of the provisions that would be of a offense provides strong incentives to the benefits for each of the provisions in similar nature to this example. our analysis although we do have fairly keep thorough and accurate records that The costs of the rule depend on our detailed estimates of the cost. We the required safety functions have been request comments on marginal costs and performed adequately and in a timely assumptions about the amount and cost benefits of specific provisions in the manner. Thus, the benefits of of testing. The amount of testing is rule. Comments can be directed either at recordkeeping are to permit detection of highly uncertain; we have tried to how well a specific provision might defective products and increase model the number of tests based on work to make dietary supplements compliance with the provisions for number of ingredients and types of tests. either safer or of higher quality, or be which recordkeeping is required. If, for We first characterized the uncertainty directed at the cost of the provision. An example: (1) The total benefits of the as a probability distribution. We ran example of this type of provision requirements that have recordkeeping 1,000 computer simulations to estimate follows for recordkeeping: attached to them were $50 million (not both benefits and costs. The simulations the real value); (2) only half of the used distributions and assumptions Benefits of Recordkeeping requirements would be met without from tables 8 through 13 of this Mandatory recordkeeping is intended recordkeeping; and, (3) recordkeeping document in place of single estimates. to help the discovery of manufacturing raised the compliance rate to 100

TABLE 19.—DISTRIBUTION OF SIMULATION RESULTS FOR ANNUAL BENEFITS AND COSTS [In millions]

5th 95th Percentile Median Mean Percentile

Annual benefits ...... $89 $198 $218 $405 Annual costs ...... 62 80 86 128

The computer simulation gives the then the results in table 19 of this results are to plausible changes in distribution of estimated benefits and document give a clear picture of the individual variables. We start with costs. If the underlying distributions uncertainty. Another way to show the benefits. capture the uncertainty of the estimates, uncertainty is to see how sensitive the

TABLE 20.—SENSITIVITY OF BENEFITS [In millions]

Estimated an- Description nual benefits

The proposed rule ...... $218 If reporting rate of illness is 0.1 (baseline is 0.01) ...... 182 If reporting rate of illness is 0.005 (baseline is 0.01) ...... 257 If the value of a statistical life is $3 million (baseline is $5 million) ...... 175 If the value of a statistical life is $7 million (baseline is $5 million) ...... 259 If consumer search time per item is 1 minute (baseline is 3.75 minutes) ...... 137 If consumer search time per item is 5 minutes (baseline is 3.75 minutes) ...... 250 If consumer search time equals 40 percent of shopping time (baseline is 70 percent) ...... 166 If consumer search time is equal to shopping time (baseline is 70 percent) ...... 254 If consumer search for quality accounts for 30 percent of search time (baseline is 20 percent) ...... 278 If consumer search time for quality accounts for 10 percent of search time (baseline is 20 percent) ...... 158 If catastrophic events are not prevented (baseline is $66 million annual benefit from prevention) ...... 152

We mainly looked at the cost effects of changing assumptions about testing and consumer complaints. As table 21 of this document shows, annual costs are quite sensitive to the assumptions about the average cost and number of tests.

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TABLE 21.—SENSITIVITY OF COSTS [In millions]

Estimated An- Description nual Costs

The proposed rule ...... $86 6 tests per batch (baseline is 3) ...... 119 1 test per batch (baseline is 3) ...... 66 $100 per test (baseline is $60) ...... 101 1 consumer complaint per 20 batches (baseline is 1 per 10) ...... 77 1 consumer complaint per 5 batches (baseline is 1 per 10) ...... 104

C. Initial Regulatory Flexibility Analysis a large decline in profitability from the questions, including how many proposed CGMP regulations. We lack employees they had and what their 1. Introduction precise information about those existing practices were. From the FDA has examined the economic establishments. Based on the survey, we survey, we determined that small implications of this proposed rule as estimated that 830 establishments, 53 establishments do not now follow all of required by the Regulatory Flexibility percent of the total establishments, the provisions of the proposed CGMP Act (5 U.S.C. 601–612). If a rule has a could be classified as very small (under regulations now. Those that do not significant economic impact on a 20 employees) and 564 as small (20 to follow the proposed requirements will substantial number of small entities, the 499 employees), which is 36 percent of incur a cost to do so. Regulatory Flexibility Act requires the total establishments. agencies to analyze regulatory options We estimated that 95 percent of all b. Costs to small entities. that would lessen the economic effect of holders (warehouses and wholesalers) Implementation costs vary across the rule on small entities. We find that covered by this regulation are small establishments based on current this proposed rule would have a using the Small Business practices and the types of products significant economic impact on a Administration definition. The total manufactured, packaged, or held. We substantial number of small entities. number of holders likely to be affected estimated the range of current practices by this regulation is 26,617 (see table 4 using the survey of the industry. The 2. Economic Effects on Small Entities of this document), so the total number cost model divided establishments by a. Number of small entities affected. of holders that are small would be size, which allowed us to estimate the The proposed regulations would affect 25,286 (= 0.95 × 26,617). distribution of costs per establishment many small entities. Our classification The small establishments that would for each size and product class. Table 22 of establishment size is based on the be affected by the proposed regulations of this document shows the cost per Small Business Administration’s are those establishments that would establishment for very small and small definition for small, as discussed have to perform the various required establishments. For comparison, we previously in this document. A small activities, and that would not have done include the estimated average cost per business by this definition is any so without the regulations. As in the large establishment and the median establishment with fewer than 500 preliminary regulatory impact analysis revenues for each size category. As the employees. For this analysis, we defined (section VII.B of this document), we table shows, costs per establishment are very small establishments as determined our estimate of baseline proportionally higher for very small establishments with fewer than 20 (pre-CGMP) manufacturing practices than for large establishments. The employees. Some small and very small with the survey of the industry (Ref. E2). table’s most striking result is that costs establishments produce very large The survey asked representative are highest for small (20 to 499 revenues and would probably not incur respondents to answer a series of employees) establishments.

TABLE 22.—COST PER ESTABLISHMENT

1st year Annual

Very small—fewer than 20 employees; median revenue under $1 million ...... $62,000 $38,000 Small—20 to 499 employees; median revenue $5 to 10 million ...... 99,000 61,000 Large—500 or more employees; median revenue $20 to $50 million ...... 83,000 47,000

Small establishments that do not In addition, the average annual largely be determined by changes made perform a substantial number of the compliance cost for a small by large establishments) would be much actions required by the proposed CGMP establishment is around $61,000. As the smaller than the increase in the average regulations would bear relatively high survey indicated, about 14 percent of costs of very small producers. The costs for compliance with the provisions establishments with 20 to 499 average burden to very small low of this proposed rule. As shown in table employees or about 200 firms have revenue firms, then, would be at least 8 22 of this document, we estimated the annual sales revenues under $500,000. percent of their annual revenue. The average annual compliance costs for a For purposes of our analysis, we regard average burden to small low revenue very small establishment to be around firms with revenues of $500,000 or less firms would be at least 12 percent of $38,000. About one-third of those to be low revenue firms. Although the annual revenue. Establishments with establishments or about 500 firms have proposed rule would raise product above average costs, and even annual sales revenues under $500,000. prices, the price increase (which would establishments with average costs,

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would be hard pressed to continue to 4. Description of Recordkeeping and Mandates Act of 1995 include assessing operate. Therefore, some of these Reporting the rule’s effects on future costs; establishments, for example, such as The Regulatory Flexibility Act productivity; particular regions, those that produce other products (foods requires a description of the communities, or industrial sectors; or pharmaceuticals) or are part of firms recordkeeping and recording required economic growth; full employment; job with more than one establishment, may for compliance with this proposed rule. creation; and exports. decide it is too costly and either change This proposed rule would require the Future Costs product lines or go out of business. If we preparation of records. As described in assume that one half of these firms have the Preliminary Regulatory Impact The future costs from the rule include sales revenues from other products and Analysis, records must be written or the recurring costs, which reach their locations and remove them from the at- electronic documents must be kept that long-term value in the third year after risk group, we are left with demonstrate that specific action or the proposed rule would become final. approximately 350 very small and small actions occurred in the manufacturing These costs would be incurred by the establishments with less than $500,000 process in compliance with the establishments that manufacture, process, pack, transport, distribute, in revenue. It is possible that a large proposed regulations. Records that receive, hold, or import dietary number of these 350 very small and would be required in this proposed rule ingredients or dietary products. small establishments would be unable would demonstrate, that corrective actions were taken, that equipment, Recurring costs from the regulatory to absorb the compliance costs and will requirements would be incurred in each close. instruments, and controls used in laboratory operations and quality future year. Table 18 of this document 3. Regulatory Options control were installed properly, and summarizes the annual future recurring calibrated; that maintenance programs costs. a. Exemptions for small entities. The were followed; and that the results of Particular Regions, Communities, or burden on small establishments would any testing meet the necessary Industrial Sectors be reduced if they were exempt from specifications. some provisions of the proposed rule. The compliance cost of recordkeeping The costs of the rule will be shared Most entities affected by this proposed is the sum of both the initial design and among manufacturers, processors, rule, however, are small. Exempting printing of the recordkeeping packagers, transporters, receivers, small establishments from some or all of documents and the recurring costs of holders, and importers of dietary its provisions would be likely to reduce maintaining the records. The cost of ingredients or dietary products as well benefits. training personnel to use the new as domestic consumers. The higher costs incurred by domestic suppliers of b. Longer compliance periods. documents is a recurring cost depending on how frequently documents are dietary supplement products as a result Lengthening the compliance period of these regulations will mostly be would provide regulatory relief for modified, how often personnel turn over, and how complicated the tasks are passed on to consumers in the form of small entities. A longer compliance higher prices. Since consumer demand period for small entities would allow that are being recorded. The recurring costs are measured by the workers’ wage for dietary supplements is price elastic, additional time for setting up rate multiplied by the expected labor most of the higher costs incurred by recordkeeping, making capital hours necessary to perform a written or suppliers will be passed on to improvements to the physical plant, electronic record and the time necessary consumers. Consequently, higher purchasing new or replacement for management to review the records to dietary supplement prices will reduce equipment, and other one-time see that actions are documented real incomes for many consumers. expenditures. It would also delay the accurately. In addition, electronic However, the reduction in real incomes impact of the annual costs of records necessitate recurring time spent is thought to be more than offset by the compliance. We have given very small ensuring that the equipment is serviced benefits from these regulations. These and small firms an additional 2 years for and maintained properly. benefits are measured as an improved compliance. The proposed rule, then, ability by the FDA to respond to and would be phased-in over 3 years, with 5. Summary contain threats of serious adverse health large firms complying after 1 year, and The proposed CGMP regulations consequences from accidental both very small and small firms after 3 would have a significant economic contamination of dietary supplements. years. After 3 years, the annual costs impact on a substantial number of small National Productivity, Economic would be incurred. The cost savings of entities. Growth, Job Creation, and Full delay may well be larger than simply D. Unfunded Mandates Employment the present value of the delay because very small and small firms may also be The Unfunded Mandates Reform Act Although this proposed regulation is able to reduce their compliance costs by of 1995 (Pub. L. 104–4) requires cost- significant, we do not expect it to taking advantage of increases in benefit and other analyses for rules that substantially affect national industry knowledge and experience in would cost more than $100 million in productivity, growth, jobs, or full a single year. The current inflation- employment. The total costs will be implementing CGMP regulations. A adjusted statutory threshold is $112 small relative to the economy, and will summary of the compliance costs is million. The proposed rule qualifies as be offset by benefits. The improved shown in table 22 of this document. a significant rule under the statute ability to respond to, and contain, Although lengthening the compliance because there is a significant possibility serious adverse health consequences period would provide some regulatory that the cost of the rule will be above means less illness and fewer sick days relief to small entities, relief for these the threshold. Most of the requirements taken by employees, and lower provisions would also delay the full of the Unfunded Mandates are fulfilled adjustment costs by firms that would realization of the benefits of the in the Executive Order 12866 analysis. otherwise need to hire replacement proposed rule. The requirements under the Unfunded employees.

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Exports comments regarding this document. Basis of Therapeutics, 5th ed., New This proposed rule would require Submit a single copy of electronic York. Macmillan Publishing, pp. 653– additional controls to be kept comments to http://www.fda.gov/ 682, 1975. 11. ‘‘Survey on Botanical throughout the production and dockets/ecomments or two hard copies Adulteration,’’ American Herbal distribution chain for the manufacture of any written comments, except that Products Association, 8484 Georgia of dietary ingredients and dietary individuals may submit one hard copy. Ave., suite 370, Silver Spring, MD supplements. The additional control Comments are to be identified with the 20910, March 4, 1998. costs would increase the total costs of docket number found in brackets in the 12. Roy, A. K. and H. K. Chourasia, production and distribution for all of heading of this document. Received ‘‘Mycotoxin Incidence in Root Drugs,’’ the regulated products, including comments may be seen in the Dockets International Journal of Crude Drug products sold within the U.S. and across Management Branch between 9 a.m. and 4 p.m., Monday through Friday. Residues, 28:2, pp. 157–160, 1990. national borders. These increased costs 13. Kumar, S. and A. K. Roy, will be largely passed on to consumers X. References ‘‘Occurrence of Aflatoxin in Some Liver in the form of higher prices, which will We have placed the following Curative Herbal Medicines,’’ Letters in tend to reduce the quantity demanded references on display in the Dockets Applied Microbiology, 17, pp. 112–114, of the regulated products. The increased Management Branch (see ADDRESSES). 1993. prices of U.S. exports could reduce the You may see them between 9 a.m. and 14. Kumar, S. and G. Prasad, ‘‘Efficacy quantity of U.S. exports demanded, 4 p.m., Monday through Friday. of Medicinal Plant (Andrographis particularly in comparison with exports 1. Section 2, ‘‘Findings,’’ Dietary peniculata) Extract on Aflatoxin from countries that do not implement Supplement Health and Education Act, Production and Growth of Aspergillus similar regulations. We expect this Pub. L. 103–417, pp. 4325–4326, flavus,’’ Letters in Microbiology 15, pp. effect to be insignificant, because under October 25, 1994. 131–132, 1992. the proposed rule the increases in the 2. ‘‘Manufacturing Practices for 15. ‘‘Adverse Events Associated with price of United States exports (and Nutritional Supplements,’’ United Ingestion of Gamma-Butyrolactone: resulting decreases in quantity States Pharmacopeia, 12601 Twinbrook Minnesota, New Mexico, and Texas, demanded) would be quite small. Pkwy., Rockville, MD 20852, General 1998–1999,’’ MMWR Weekly, 48:07, pp. VIII. Federalism Chapter 2750, 2186–2192, and 2834, 137–140, February 26, 1999. 1993. 16. FDA Establishment Inspection FDA has analyzed this proposed rule 3. ‘‘NNFA Good Manufacturing Report, Ducoa Co., CFN #1944182, in accordance with the principles set Practice in Manufacturing, Packing, or August 31, 1998 and September 1, 1998. forth in Executive Order 13132. We Holding Dietary Supplements,’’ 17. FDA Health Hazard Evaluation, consulted with seven State officials to National Nutritional Foods Association, Classification, and FDA Enforcement make a tentative determination about 3931 MacArthur Blvd., suite 101, Report for Firm-Initiated Recall—Lead, whether this proposed rule would have Newport Beach, CA 92660, 1999. U.S. FDA Recall #F–006–5 and #F–137/ federalism implications. Based on this 4. ‘‘Draft Report of the Food Advisory 145–5, 1994. consultation, it does not appear that this Committee Dietary Supplement 18. FDA Health Hazard Evaluation, proposed rule has federalism Working Group on Ingredient Identity Classification, and FDA Enforcement implications. In addition, we sent a Testing and Records and Retention,’’ Report for Firm-Initiated Recall letter on March 7, 2000, to elected State FDA Food Advisory Committee Dietary Salmonella, U.S. FDA Recall #F–164/ officials and their representative Supplement Working Group, Center for 171–8, 1988. organization to notify them that our Food Safety and Applied Nutrition, 19. FDA Health Hazard Evaluation, unified agenda was published on FDA, June 25, 1999. Classification, and FDA Enforcement November 22, 1999, and identified this 5. ‘‘Consumer Use of Dietary Report for Firm-Initiated Recall— proposed CGMP rule as a rule that Supplements,’’ Rodale Press, 733 Third Klebsiella Pneumonia, U.S. FDA Recall would publish in the year 2000. In that Ave., New York, NY 10017, 2000. #F–522–0, 1990. letter, we solicited comments on any 6. Slifman, N. R., W. R. Obermeyer, B. 20. FDA Health Hazard Evaluation, federalism implications that this K. Aloi, S. M. Musser, W. A. Correll, S. Classification, and FDA Enforcement proposed rule may have. To date, no M. Cichowicz, J. M. Betz, and L. A. Report for Firm-Initiated Recall— responses have been received to our Love, ‘‘Contamination of Botanical Botulism, U.S. FDA Recall #F–563/564– solicitation. After publishing this Dietary Supplements by Digitalis 9, 1989. proposed rule, FDA will send a letter to Lanata,’’ New England Journal of 21. FDA Health Hazard Evaluation, elected State officials and their Medicine, 339:12, pp. 806–811, 1998. Classification, and FDA Enforcement representative organization requesting 7. ‘‘Cardiac Glycoside Drugs,’’ In: Report for Firm-Initiated Recall—Glass consultation about any federalism Wagner, H., and S. Bladt, Plant Drug Fragments, U.S. FDA Recall #F–540–3, implications. We invite comment on our Analysis: A Thin Layer Chromatography 1993. tentative determination that this Atlas, 2d ed., Berlin, Germany: 22. FDA Health Hazard Evaluation, proposed rule does not have federalism Springer-Verlag, pp. 99–123, 1996. Classification, and FDA Enforcement implications, and therefore, does not 8. Bruneton, J., Pharmacognosy, Report for Firm-Initiated Recall Super- contain policies that have substantial Phytochemistry, Medicinal Plants, Paris, Potent Vitamin A, U.S. FDA Recall #F– direct effects on the States, or on the Lavoisier Publishing, pp. 572–598, 157/158–5, 1994. distribution of power and 1995. 23. FDA Health Hazard Evaluation, responsibilities among the various 9. Evans, W. C., Trease and Evans’ Classification, and FDA Enforcement levels of government. Pharmacognosy. 14th ed., Philadelphia, Report for Firm-Initiated Recall—Super- W. B. Saunders, pp. 309–318, 1996. Potent Vitamin D, U.S. FDA Recall IX. Request for Comments 10. Moe, G. K. and A. E. Farah, #F0610–3, 1993. Interested persons may submit to the ‘‘Digitalis and Allied Cardiac 24. FDA Health Hazard Evaluation, Dockets Management Branch (see Glycosides,’’ In L. S. Goodman and A. Classification, and FDA Enforcement ADDRESSES) written or electronic Gilman, eds., The Pharmacological Report for Firm-Initiated Recall—Super-

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Potent Vitamin B–6, U.S. FDA Recall Encephalopathies of Animals,’’ Reduce the Potential Risk Posed by #F–272–3, 1993. Riverdale, MD, 1996. Bovine Spongiform Encephalopathy 25. FDA Health Hazard Evaluation, 38. ‘‘Frontier,’’ ‘‘Nature’s Herbs,’’ and (BSE) in FDA-Regulated Products for Classification, and FDA Enforcement ‘‘Nature’s Way,’’ (http:// Human Use,’’ U.S. Department of Health Report for Firm-Initiated Recall Super- www.mothernature.com), June 2000. and Human Services, Food and Drug Potent Selenium, U.S. FDA Recall #F– 39. USDA Food Composition Data, Administration, September 1997. 007–5, 1994. National Agricultural Library, Food and 53. ‘‘Guidance for Industry, Guide to 26. ‘‘Table 1. Tolerable Upper Intake Nutrition Information Center, USDA, Minimize Microbial Food Safety Levels (UL) for Certain Nutrients and May 2000. Hazards for Fresh Fruits and Food Components,’’ Dietary Reference 40. ‘‘King-size Gingersnaps, The Good Vegetables,’’ U.S. Department of Health Intakes: A Risk Assessment Model for Housekeeping Cookbook, p. 564, New and Human Services, Food and Drug Establishing Upper Intake Levels, 20, York, NY, 1973. Administration, Center for Food Safety Food and Nutrition Board, Institute of 41. ‘‘Food Defect Action Levels: and Applied Nutrition (CFSAN), Medicine, National Academy of Levels of Natural or Unavoidable October 1998. Sciences, Washington, DC, June 1999. Defects in Foods that Present no Health 54. Webster’s II New Riverside 27. FDA Health Hazard Evaluation, Hazards for Humans,’’ Department of University Dictionary, Houghton Mifflin Classification, and FDA Enforcement Health and Human Services, Public Co., 222 Berkeley St., Boston, MA Report for Firm-Initiated Recall—Sub- Health Service, Food and Drug 02116, p. 961, 1994. Potent Folic Acid, U.S. FDA Recall #F– Administration, Center for Food Safety 55. ‘‘FDA Fact Sheet: Shigella in 825–7, 1996. and Applied Nutrition, Washington, DC Food,’’ Food and Drug Administration, 28. FDA Health Hazard Evaluation, 20204, May 1998. U.S. Department of Health, Education, Classification, and FDA Enforcement 42. ‘‘Hazard Analysis and Critical and Welfare, Public Health Service, Report for Firm-Initiated Recall Color Control Point Principles and December 1969. Additives, Yellow #6, Red #40, Blue #2, Application Guidelines,’’ National 56. Bryan, F. L., ‘‘Emerging Foodborne U.S. FDA Recall #F–314–8, 1998. Advisory Committee on Microbiological Diseases: I. Their Surveillance and 29. FDA Health Hazard Evaluation, Criteria for Foods, August 14, 1997. Epidemiology,’’ Journal of Milk and 43. Presidential Memorandum on Classification, and FDA Enforcement Food Technology, 35:10, pp. 618–625, Plain Language, The White House, Report for Firm-Initiated Recall—Color October 1972. Washington, June 1, 1998. 57. Cross Connection Control Additives, Yellow #5, U.S. FDA Recall 44. Olsen, A. R., ‘‘Regulatory Action Committee, Pacific Northwest Section, #F–761–4, 1994. Criteria for Filth and Other Extraneous American Water Works Association, 30. FDA Health Hazard Evaluation, Materials. II. Allergenic Mites: An with the Assistance of EPA, ‘‘Cross Classification, and FDA Enforcement Emerging Food Safety Issue,’’ Connection Control Manual Accepted Report for Firm-Initiated Recall— Regulatory Toxicology and Procedures and Practice,’’ Section 1 Lactose, U.S. FDA Recall #F–271–6, Pharmacology, 28, pp. 190–198, 1998. ‘‘Introduction to Cross Connection 1995. 45. U.S. Department of Health and Control and Backflow Prevention,’’ 5th 31. FDA Health Hazard Evaluation, Human Services, Food and Drug ed., pp. xiv, 1–2, 3–4, 3–5, 3–6, 3–7, Classification, and FDA Enforcement Administration, ‘‘Food Code,’’ Section May 1990. Report for Firm-Initiated Recall— 1–201.10(B)(72), p. 15, 1999. 58. ‘‘Factors Affecting the Growth of Sulfites, U.S. FDA Recall #F–538/539–9 46. ‘‘Immunoglobin g (IgG) Dietary Microorganisms in Foods,’’ The Bad Bug 1999. Supplement,’’ Book, U.S. Food and Drug 32. Weber, R. W., ‘‘Food Additives (www.kingsnutrition.com/ Administration, Center for Food Safety and Allergy,’’ Annals of Allergy, 70, pp. immunol.html). and Applied Nutrition, Foodborne 183–190, 1993. 47. Vasarada, P. C. and M. A. Cousin, Pathogenic Microorganisms and Natural 33. Gurley, B. J., S. F. Gardner, and M. ‘‘Dairy Microbiology and Safety,’’ In: Toxins Handbook, 1997. A. Hubbard, ‘‘Content Versus Label Dairy Science and Technology 59. FDA ‘‘Guide to Inspections of Claims in Ephedra-containing Dietary Handbook, vol. 2, edited by Y. H. Hui, Computerized Systems in the Food Supplements,’’ (Prepublication version) New York, Chapter 5, pp. 301–426, VCH Processing Industry,’’ Division of American Journal Health Systems Publishers, Inc., 1992. Emergency and Investigational Pharmacy, 57, pp. 963–969, May 15, 48. Stauffer, J. E., ‘‘Quality Assurance Operations, Office of Regional 2000. and Dairy Processing,’’ In: Dairy Science Operations, Office of Regulatory Affairs, 34. Consumer Labs Product Reviews and Technology Handbook, vol. 3, U.S. Food and Drug Administration, on Ginkgo Biloba, Saw Palmetto, edited by Y. H. Hui, New York: Chapter March 1998. Glucosamine and Chrondroitin, and 1, pp. 1–76, VCH Publishers, Inc., 1992. 60. Moody, M. W., ‘‘How Cleaning SAMe, (http://www.consumerlabs.com). 49. Biotics Research Products (http:// Compounds Do the Job,’’ Seafood 35. ‘‘Methods Validation and www.increasedhealth.com/ Technology Cooperative Extension Technical Programs,’’ AOAC Official biotics_description.shtml). Service, Louisiana State University, pp. Methods Program, (http:// 50. ‘‘Bovine-Derived Materials; 33–41, undated. www.aoac.org), March 17, 2000. Agency Letters to Manufacturers of 61. Lentsch, S., ‘‘Sanitizers for an 36. Alexander, R. G., D. A. Wilson, FDA-Regulated Products,’’ Federal Effective Cleaning Program,’’ Klenzade and A. G. Davidson, ‘‘Medicines Control Register, August 29, 1994. Division, Economics Laboratories, St. Agency Investigation of the Microbial 51. ‘‘Points to Consider in the Paul, MN, undated. Quality of Herbal Products,’’ The Manufacture and Testing of Therapeutic 62. FDA ‘‘Guide to Inspections of Pharmaceutical Journal, pp. 259–261, Products for Human Use Derived from Computerized Systems in Drug August 1997. Transgenic Animals,’’ FDA, Center for Processing,’’ February 1983. 37. Transcript, FDA and USDA Biologics Evaluation and Research, 63. Hitokoto H., S. Morozumi, T. Symposium, ‘‘Tissue Distribution, 1995. Wauke, S. Sakai, and H. Kurata, ‘‘Fungal Inactivation, and Transmission of 52. ‘‘Guidance for Industry, The Contamination and Mycotoxin Transmissible Spongiform Sourcing and Processing of Gelatin to Detection of Powdered Herbal Drugs,’’

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Applied and Environmental 78. FDA Health Hazard Evaluation, Information Use Characteristics of Microbiology, 36:2, pp. 252–256, 1978. Classification, and FDA Enforcement Dietary Supplement User Segments,’’ A 64. Stewart, M. J., V. Steenkamp, and Report for Firm-Initiated Recall Vitamin report prepared for the Commission on M. Zuckerman, ‘‘The Toxicology of C, U.S. FDA Recall #F–657–8, 1998. Dietary Supplement Labeling, Food and African Herbal Remedies,’’ Therapeutic 79. FDA Health Hazard Evaluation, Drug Administration, Center for Food Drug Monitoring, 20, pp. 510–516, 1998. Classification, and FDA Enforcement Safety and Applied Nutrition, Division 65. Halt, M., ‘‘Moulds and Mycotoxins Report for Firm-Initiated Recall Vitamin of Market Studies, March 12, 1997. in Herb Tea and Medicinal Plants,’’ Mineral Supplement, U.S. FDA Recall E9. Eisenberg, D. M., R. B. Davis, S. European Journal of Epidemiology, 14, #F–717–0, 1990. L. Ettner, S. Appel, S. Wildey, M. Van pp. 269–274, 1998. 80. Report of the Commission on Rompay, R. C. Kessler, ‘‘Trends in 66. Pharmacopeial Previews: Dietary Supplement Labels, Office of Alternative Medicine Use in the United Nutritional Supplements—Section 2022: Disease Prevention and Health States, 1990–1997: Results of a Follow- Microbial Procedures for Absence of Promotion, Department of Health and up National Survey,’’ Journal of the Objectionable Microorganisms in Human Services, Washington, DC American Medical Association, Nutritional and Dietary Articles, 20201, pp. 21 and 45, November 1997. 280(18):1569–1575, 1998. Pharmacopeial Forum, vol. 25:5, pp. 81. Webster’s II New Riverside E10. Food Marketing Institute, 8761–8769, September-October 1999. University Dictionary, Houghton Mifflin Research Department, and Prevention 67. Pharmacopeial Previews: Co., 222 Berkeley St., Boston, MA Magazine, Research Department, A Look Nutritional Supplements—Section 2023: 02116, p. 761, 1994. at the Self Care Movement, Food Microbiological Attributes of Nonsterile 82. ‘‘Manufacturing Practices for Marketing Institute and Prevention Nutritional and Dietary Articles, Dietary Supplements, Pharmacopeial Magazine, 1998. Pharmacopeial Forum, vol. 25:5, pp. Forum, 28:2, pp. 534–552, March/April E11. Wilde, L. L., ‘‘Information Costs, 8770–8773, September-October 1999. 2002. Duration of Search, and Turnover: 68. AOAC Official Method 967.22, 83. Draft Standard NSF 173–2001, Theory and Applications,’’ Journal of Vitamin C (Total) in Vitamin Dietary Supplements, NSF International Political Economy, 89, December, 1122– Preparations, AOAC Official Method Draft Standard, NSF International, 789 1141, 1981. 984.26, Vitamin C (Total) in Food, North Dixboro Road, P.O. Box 130140, E12. McCarthy, P. and B. Timbo, Official Methods of Analysis of AOAC Ann Arbor, Michigan 48113. Memorandum: Report of Adverse Health International, 16 ed., Gaithersburg, MD, Outcomes Associated With the References—Economics 1995. Consumption of Dietary Supplements 69. Madis, V. H. and V. Madis, ‘‘The E1. Research Triangle Institute (RTI), Which Were Prepared Using Poor Sampling of Crude Botanicals,’’ D&CI, 1999a, ‘‘Economic Characterization of Manufacturing Practices, November 17, (1986), pp. 38–43 and 79. the Dietary Supplement Industry,’’ 1999. 70. Centers for Disease Control, Contract No. 223–96–2290: Task Order E13. Prevention Magazine and Food ‘‘Anticholinergic Poisoning Associated 3, March 1999. Marketing Institute (FMI), ‘‘The With an Herbal Tea—New York City, E2. RTI, ‘‘Survey of Manufacturing Growing Self-Care Movement,’’ 1994,’’ Morbidity and Mortality Weekly Practices in the Dietary Supplement Prevention/FMI Survey, 2000. Report, 44:11, pp. 193–195; March 25, Industry,’’ Contract No. 223–96–2290: E14. Gugliotta, G., ‘‘Health Concerns 1995. Task Order 6, May 2000. Grow Over Herbal Aids,’’ Washington 71. Ernst, E., ‘‘Harmless Herbs? A E3. NPR/Kaiser Family Foundation/ Post, March 19, 2000. Review of the Recent Literature,’’ Kennedy School of Government, Survey E15. Koehler, K. M., Memorandum: American Journal of Medicine, p. 104, of Americans and Dietary Supplements, Tally of AERs Regarding Dietary pp. 170–178, 1998. 1999. Supplements, May 30, 2000. 72. Huxtable, R. J., ‘‘The Harmful E4. Guthrie, J. F., K. M. Koehler, and E16. Walker, A. M., ‘‘The Relation Potential of Herbal and Other Plant R. A. Scharff, ‘‘Trends in the Between Voluntary Notification and Products,’’ Drug Safety, 5 (Suppl. 1), pp. Consumption of Dietary Supplements Material Risk in Dietary Supplement 126–136, 1990. Since 1994,’’ Unpublished, 2000. Safety,’’ Harvard School of Public 73. Betz, J. M., ‘‘Plant Toxins,’’ E5. ‘‘US Dietary Supplements Market Health, March 9, 2000. General Referee Reports: Journal of Size Expressed as Dollar Sales by Top E17. Alsop, R. J., 1999, Wall Street AOAC International, 78:1, pp. 141–144, Six Product Categories for 1994 to 1998 Journal Almanac, New York, Ballantine 1995. and Forecast for 1999 and 2000,’’ Books, pp. 554–563, 1998. 74. Chan, T. Y. K., J. C. N. Chan, B. Nutrition Business Journal, Dialog File E18. Viscusi, W. K., ‘‘The Value of Tomlinson, and J. A. J. H. Critchley, Number 93, San Francisco, The Dialog Risks to Life and Health,’’ Journal of ‘‘Chinese Herbal Medicines Revisited: A Corp., 2000. Economic Literature, 31: 1912–1946, Hong Kong Perspective,’’ The Lancet, E6. Supplementary Data Tables, 1993. 342, pp. 1532–1534, 1993. USDA’s 1994–96 Continuing Survey of E19. Economic Report of the 75. Wong, M. K., P. Tan, and Y. C. Food Intakes by Individuals; Food President, Washington, DC, United Wee, ‘‘Heavy Metals in Some Chinese Surveys Research Group, Beltsville States Government Printing Office, Herbal Plants,’’ Biological Trace Human Nutrition Research Center, 2000. Element Research, 36, pp. 135–142, Agricultural Research Service, U.S. E20. Kaplan, M., J. A. Anderson, and 1993. Department of Agriculture, Riverdale, T. G. Ganiats, ‘‘The Quality of Well- 76. ‘‘Reviewer Guidance, Validation MD; February 1999; accessed at http:// being Scale: Rationale for a Single of Chromatographic Methods Center for www.barc.usda.gov/bhnrc/foodsurvey/ Quality of Life Index,’’ edited by S. R. Drug Evaluation and Research, FDA, home.htm. Walker and R. M. Rosser, In Quality of November 1994. E7. Prevention Research Associates, Life Assessment: Key Issues in the 77. FDA Health Hazard Evaluation, Special Nutritionals Survey, Report for 1990’s, The Netherlands: Kluwer Classification, and FDA Enforcement Prevention Magazine, June 8, 1999. Academic Publishers, 65–94, 1993. Report for Firm-Initiated Recall #F–321– E8. Roe, B. E., B. M. Derby, A. L. Levy, E21. Kaufman, L. D. ‘‘Chronicity of 0, 1989. ‘‘Demographic, Lifestyle and the Eosinophilia-Myalgia Syndrome. A

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Reassessment After Three Years,’’ Americans Use Their Time, University 21 CFR Part 112 Arthritis and Rheumatism, 37:884–887, Park, PA: The Pennsylvania State Drugs, Packaging and containers, 1994 Abstract. University Press, 1997. Labeling. E22. Hedberg, C., et al., E38. ‘‘How Consumers Shop,’’ ‘‘Eosinophilia-Myalgia Syndrome, Progressive Grocer, December, 62–64, Therefore, under the Federal Food, Natural History in a Population Based 1992. Drug, and Cosmetic Act and under Cohort,’’ Archives of Internal Medicine, E39. United States Department of authority delegated to the Commissioner 152:1189–1892, 1992 Abstract. Labor, Bureau of Labor Statistics (BLS), of Food and Drugs, FDA proposes to E23. Vanherweghem, J. L., ‘‘Misuse of

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and composition, and is produced is not necessarily limited to, a dietary ingredients, or dietary supplements that during a specified time period according ingredient as described in section have been previously removed from to a single manufacturing record during 201(ff) of the Act. manufacturing for reasons other than the same cycle of manufacture. Inprocess material means any insanitary conditions and that have Batch number, lot number, or control material that is fabricated, compounded, been made suitable for use in the number means any distinctive group of blended, ground, extracted, sifted, manufacture of a dietary ingredient or letters, numbers, or symbols, or any sterilized, derived by chemical reaction, dietary supplement. combination of them, from which the or processed in any other way for use Sanitize means to adequately treat complete history of the manufacturing, in the manufacture of a dietary equipment, containers, utensils, or any packaging, or holding of a batch or lot ingredient or dietary supplement. other dietary product contact surface by of dietary ingredients or dietary Lot means a batch, or a specific applying cumulative heat or chemicals supplements can be determined. identified portion of a batch intended to on cleaned food contact surfaces that Component means any substance have uniform identity, purity, quality, when evaluated for efficacy, yield a intended for use in the manufacture of strength, and composition; or, in the reduction of 5 logs, which is equal to a dietary ingredient or dietary case of a dietary ingredient or dietary 99.999 percent reduction, of supplement including those that may supplement produced by continuous representative disease microorganisms not appear in the finished dietary process, a specific identified amount of public health significance and ingredient or dietary supplement. produced in a specified unit of time or substantially reduce the numbers of Component includes ingredients and quantity in a manner that is intended to other undesirable microorganisms, but dietary ingredients as described in have uniform identity, purity, quality, without adversely affecting the product section 201(ff) of the Act. strength, and composition. or its safety for the consumer. Consumer complaint means Microorganisms means yeasts, molds, Theoretical yield means the quantity communication that contains any bacteria, viruses, and other similar that would be produced at any allegation, written or oral, expressing microscopic organisms having public appropriate step of manufacture or dissatisfaction with the quality of a health or sanitary concern. This packaging of a particular dietary dietary ingredient or a dietary definition includes, but is not limited ingredient or dietary supplement, based supplement related to good to, species that: upon the quantity of components or manufacturing practices. Examples of (1) Have public health significance; packaging to be used, in the absence of product quality related to good (2) Could cause a component, dietary any loss or error in actual production. manufacturing practices are: Foul odor, ingredient, or dietary supplement to Water activity (aw) is a measure of the off taste, superpotent, subpotent, wrong decompose; free moisture in a component, dietary ingredient, drug contaminant, other (3) Indicate that the component, ingredient, or dietary supplement and is contaminant (e.g., bacteria, pesticide, dietary ingredient, or dietary the quotient of the water vapor pressure mycotoxin, glass, lead), disintegration supplement is contaminated with filth; of the substance divided by the vapor time, color variation, tablet size or size or pressure of pure water at the same variation, under-filled container, foreign (4) Otherwise may cause the temperature. material in a dietary supplement component, dietary ingredient, or We means the United States Food and container, improper packaging, or dietary supplement to be adulterated. Drug Administration (FDA). mislabeling. For the purposes of the Must is used to state mandatory You means a person who regulations in this part, a consumer requirements. manufactures, packages, or holds complaint about product quality may or Pest means any objectionable insects dietary ingredients or dietary may not include concerns about a or other animals including, but not supplements. possible hazard to health. However, a limited to, birds, rodents, flies, mites, consumer complaint does not include and larvae. § 111.5 Do other statutory provisions and an adverse event, illness, or injury Physical plant means all or parts of a regulations apply? related to the safety of a particular building or facility used for or in In addition to the regulations in this dietary ingredient independent of connection with manufacturing, part, you must comply with other whether the product is produced under packaging, or holding a dietary applicable statutory provisions and good manufacturing practices. ingredient or dietary supplement. regulations under the Act related to the Contact surface means any surface Quality control means a planned and manufacturing, packaging, or holding of that contacts a component, dietary systematic operation or procedure for dietary ingredients or dietary ingredient, dietary supplement, and preventing a dietary ingredient or supplements. those surfaces from which drainage onto dietary supplement from being the component, dietary ingredient, adulterated. § 111.6 Exclusions. dietary supplement, or onto surfaces Quality control unit means any person The regulations in this part do not that contact the component, dietary or group that you designate to be apply to a person engaged solely in ingredient, or dietary supplement responsible for quality control activities related to the harvesting, ordinarily occurs during the normal operations. storage, or distribution of raw course of operations. Examples of Representative sample means a agricultural commodities that will be contact surfaces include, but are not sample that consists of a number of incorporated into a dietary ingredient or limited to, containers, utensils, tables, units that are drawn based on rational dietary supplement by other persons. contact surfaces of equipment, and criteria, such as random sampling, and 4. Add new subpart B to part 111 to packaging. intended to ensure that the sample read as follows: Ingredient means any substance that accurately portrays the material being Subpart B—Personnel is used in the manufacture of a dietary sampled. Sec. ingredient or dietary supplement that is Reprocessing means using, in the 111.10 What microbial contamination and intended to be present in the finished manufacture of a dietary ingredient or a hygiene requirements apply? dietary ingredient or dietary dietary supplement, clean, 111.12 What personnel qualification supplement. An ingredient includes, but unadulterated components, dietary requirements apply?

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111.13 What supervisor requirements be adequately sanitized during periods 111.15 What sanitation requirements apply apply? in which components, dietary to your physical plant? ingredients, or dietary supplements are 111.20 What design and construction Subpart B—Personnel manipulated by hand. If hand jewelry requirements apply to your physical plant? § 111.10 What microbial contamination cannot be removed, it must be covered and hygiene requirements apply? by material that is maintained in an Subpart C—Physical Plant (a) Microbial contamination. You intact, clean, and sanitary condition and must take measures to exclude from any that effectively protects against § 111.15 What sanitation requirements apply to your physical plant? operations any person who might be a contamination of components, dietary source of microbial contamination of ingredients, dietary supplements, or (a) Physical plant facilities. (1) You any material including components, contact surfaces; must maintain your physical plant in a dietary ingredients, dietary (5) Maintaining gloves used in clean and sanitary condition; and supplements, and contact surfaces used handling components, dietary (2) You must keep your physical plant in the manufacture, packaging, or ingredients, or dietary supplements in in repair sufficient to prevent holding of a dietary ingredient or a an intact, clean, and sanitary condition. components, dietary ingredients, dietary dietary supplement. Such measures The gloves must be of an impermeable supplements, or contact surfaces from include, but are not limited to, the material; becoming contaminated. (6) Wearing, where appropriate, in an following: (b) Cleaning compounds, sanitizing (1) Excluding any person who, by effective manner, hair nets, caps, beard agents, and pesticides. (1) You must use medical examination or supervisory covers, or other effective hair restraints; cleaning compounds and sanitizing (7) Not storing clothing or other observation, is shown to have, or agents that are free from microorganisms personal belongings in areas where appears to have an illness, open lesion, of public health significance and safe components, dietary ingredients, or or any other abnormal source of and adequate under the conditions of dietary supplements or any contact microbial contamination, which may be use. surfaces are exposed or where contact expected to result in microbial (2) You must not use or hold toxic surfaces are washed; contamination of components, dietary materials in a physical plant in which (8) Not eating food, chewing gum, contact surfaces, components, dietary ingredients, dietary supplements, or drinking beverages and using tobacco contact surfaces, from working in any ingredients, or dietary supplements are products in areas where components, manufactured or exposed, unless those operations until the condition is dietary ingredients, dietary corrected; and materials are necessary: supplements, or any contact surfaces are (i) To maintain clean and sanitary (2) Instructing your employees to exposed, or where contact surfaces are notify their supervisor(s) if they have or conditions; washed; and (ii) For use in laboratory testing if there is a reasonable possibility that (9) Taking any other precautions procedures; they have a health condition described necessary to protect against the (iii) For maintaining or operating the in paragraph (a)(1) of this section that contamination of components, dietary physical plant or equipment; or could contaminate any components, ingredients, dietary supplements, or dietary ingredients, dietary contact surfaces with microorganisms, (iv) For use in the plant’s operations. supplements, or any contact surface. filth, or any other extraneous materials, (3) You must identify and hold toxic (b) Hygienic practices. If you work in including, but not limited to, cleaning compounds, sanitizing agents, operations during which adulteration of perspiration, hair, cosmetics, tobacco, pesticides, and pesticide chemicals in a the component, dietary ingredients, chemicals, and medicines applied to the manner that protects against dietary supplement, or contact surface skin. contamination of components, dietary may occur, you must use hygienic ingredients, dietary supplements, or practices to the extent necessary to § 111.12 What personnel qualification contact surfaces. protect against contamination of requirements apply? (c) Pest control. (1) You must not components, dietary ingredients, dietary (a) You must have qualified allow animals or pests in any area of supplements, or contact surfaces. These employees to manufacture, package, or your physical plant. Guard or guide hygienic practices include, but are not hold dietary ingredients or dietary dogs are allowed in some areas of your limited to: supplements; and physical plant if the presence of the (1) Wearing outer garments in a (b) Each person engaged in dogs will not result in contamination of manner that protects against the manufacturing, packaging, or holding components, dietary ingredients, dietary contamination of components, dietary must have the training and experience supplements, or contact surfaces; ingredients, dietary supplements, or any to perform the person’s duties. (2) You must take effective measures contact surface; to exclude pests from the physical plant § 111.13 What supervisor requirements (2) Maintaining adequate personal apply? and to protect against contamination of cleanliness; components, dietary ingredients, dietary (a) You must assign qualified (3) Washing hands thoroughly (and supplements, and contact surfaces on personnel to supervise the sanitizing if necessary to protect against the premises by pests; and manufacturing, packaging, or holding of contamination with microorganisms) in (3) You must not use insecticides, dietary ingredients and dietary an adequate hand-washing facility: fumigants, fungicides, or rodenticides, supplements. (i) Before starting work; and unless you take precautions to protect (b) You and the supervisors you use (ii) At any time when the hands may against the contamination of must be qualified by training and have become soiled or contaminated; components, dietary ingredients, dietary experience to supervise. (4) Removing all unsecured jewelry 5. Add new subpart C to part 111 to supplements, or contact surfaces. and other objects that might fall into read as follows: (d) Water supply. (1) You must components, dietary ingredients, dietary provide water that is safe and of supplements, equipment, or packaging, Subpart C—Physical Plant adequate sanitary quality, at suitable and removing hand jewelry that cannot Sec. temperatures, and under pressure as

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needed, in all areas where water is (3) Provide doors that do not open § 111.20 What design and construction necessary for: into areas where components, dietary requirements apply to your physical plant? (i) Manufacturing dietary ingredients ingredients, dietary supplements, or Any physical plant you use in the or dietary supplements; contact surfaces are exposed to airborne manufacture, packaging, or holding of (ii) Making ice that comes in contact contamination except where alternate dietary ingredients or dietary with components, dietary ingredients, means have been taken to protect supplements must: dietary supplements, or contact against contamination (such as double (a) Be suitable in size, construction, surfaces; doors or positive airflow systems). and design to facilitate maintenance, (iii) Cleaning any surface; and (h) Hand-washing facilities. You must cleaning, and sanitizing operations; (iv) Employee bathrooms and hand- provide hand-washing facilities that are (b) Have adequate space for the washing facilities. adequate, convenient, and furnish orderly placement of equipment and (2) Water that contacts components, running water at a suitable temperature. holding materials as is necessary for dietary ingredients, dietary You must do this by providing: maintenance, cleaning, and sanitizing supplements, or any contact surface (1) Hand-washing and, where operations and to prevent must at a minimum comply with the appropriate, hand-sanitizing facilities at contamination and mixups of National Primary Drinking Water each location in your physical plant components, dietary ingredients, and regulations prescribed by the where good hygienic practices require dietary supplements during Environmental Protection Agency under employees to wash or to sanitize or both manufacturing, packaging, or holding; (c) Permit the use of proper 40 CFR part 141 and any state and local wash and sanitize their hands; government requirements; precautions to reduce the potential for (3) You must have documentation or (2) Effective hand-cleaning and mixups or contamination of otherwise be able to show that water sanitizing preparations; components, dietary ingredients, dietary that contacts components, dietary (3) Air driers, sanitary towel service, supplements, or contact surfaces, with ingredients, dietary supplements, or any such as disposable paper towels, or microorganisms, chemicals, filth, or contact surface meets the requirements other suitable drying devices; other extraneous material. Your in paragraph (d)(2) of this section. (4) Devices or fixtures, such as water physical plant must have and you must (e) Plumbing. The plumbing in your control valves, designed and use separate or defined areas of physical plant must be of an adequate constructed to protect against adequate size or other control systems, size and design and be adequately recontamination of clean, sanitized such as computerized inventory installed and maintained to: hands; controls or automated systems of (1) Carry sufficient amounts of water (5) Signs that are easy to understand separation, to prevent contamination to required locations throughout the and are posted throughout the physical and mixups of components, dietary physical plant; plant that direct employees handling ingredients, and dietary supplements (2) Properly convey sewage and liquid components, dietary ingredients, dietary during the following operations: disposable waste from your physical supplements, or contact surfaces to (1) Receiving, identifying, holding, plant; wash and, where appropriate, to sanitize and withholding from use, components, (3) Avoid being a source of their hands before they start work, after dietary ingredients, dietary contamination to components, dietary each absence from their duty station, supplements, packaging, and labels that ingredients, dietary supplements, water and when their hands may have become will be used in or during the supplies, or any contact surface, or soiled or contaminated; and manufacturing, packaging, or holding of creating an unsanitary condition; (6) Trash bins that are constructed dietary ingredients and dietary (4) Provide adequate floor drainage in and maintained in a manner to protect supplements; all areas where floors are subject to against recontamination of hands and (2) Separating, as necessary, flooding-type cleaning or where normal contamination of components, dietary components, dietary ingredients, dietary operations release or discharge water or ingredients, dietary supplements, or any supplements, packaging, and labels that other liquid waste on the floor; and contact surface. are to be used from components, dietary (5) Not allow backflow from, or cross (i) Trash disposal. You must convey, ingredients, dietary supplements, connection between, piping systems store, and dispose of trash to: packaging, or labels that are awaiting that discharge waste water or sewage (1) Minimize the development of material review and disposition and piping systems that carry water odor; decision, reprocessing, or are awaiting used for manufacturing dietary (2) Minimize the potential for the disposal after rejection; ingredients or dietary supplements, for trash to attract, harbor, or become a (3) Separating the manufacturing, cleaning contact surfaces, or for use in breeding place for pests; packaging, and holding of different bathrooms or hand-washing facilities. product types including, but not limited (3) Protect against contamination of (f) Sewage disposal. You must dispose to, different types of dietary ingredients, components, dietary ingredients, dietary of sewage into an adequate sewage dietary supplements and other foods, supplements, any contact surface, water system or through other adequate cosmetics, and pharmaceutical supplies, and grounds surrounding your means. products; (g) Bathrooms. You must provide your physical plant; and (4) Performing laboratory analyses employees with adequate, readily (4) Control hazardous waste to and holding laboratory supplies and accessible bathrooms. The bathrooms prevent contamination of components, samples; must be kept clean and must not dietary ingredients, dietary (5) Cleaning and sanitizing contact become a potential source of supplements, and contact surfaces. surfaces; contamination to components, dietary (j) Sanitation supervisors. You must (6) Packaging and label operations; ingredients, dietary supplements, or assign one or more employees to and contact surfaces. You must: supervise overall sanitation. These (7) Holding dietary ingredients or (1) Keep the bathrooms in good repair supervisors must be qualified by dietary supplements. at all times; training and experience to develop and (d) Be designed and constructed in a (2) Provide self-closing doors; and supervise sanitation procedures. manner that prevents contamination of

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components, dietary ingredients, dietary (3) Placement in areas where you can (v) Maintained to protect components, supplements, or contact surfaces. The check regularly for pests, pest dietary ingredients, and dietary design and construction must include, infestation, filth or any other extraneous supplements from being contaminated but not be limited to: materials; and by any source. (1) Floors, walls, and ceilings that are (4) Use of skimming equipment. (4) Equipment and utensils you use of smooth and hard surfaces that can be (h) Use adequate screening or other must have seams that are smoothly adequately cleaned and kept clean and protection against pests, where bonded or maintained to minimize in good repair; necessary. accumulation of component, dietary (2) Fixtures, ducts, and pipes that do 6. Add new subpart D to part 111 to ingredient, or dietary supplement not contaminate components, dietary read as follows: particles, dirt, filth, organic material, or ingredients, dietary supplements, or Subpart D—Equipment and Utensils any other extraneous materials or contact surfaces by dripping or contaminants to minimize the Sec. condensate; 111.25 What requirements apply to the opportunity for growth of (3) Adequate ventilation or equipment and utensils you use? microorganisms. environmental control equipment such 111.30 What requirements apply to (5) Each freezer and cold storage as air flow systems, including filters, automatic, mechanical, or electronic compartment you use to hold fans, and other air-blowing equipment, equipment? components, dietary ingredients, or that minimize odors and vapors dietary supplements: (including steam and noxious fumes) in Subpart D—Equipment and Utensils (i) Must be fitted with an indicating areas where they may contaminate thermometer, temperature-measuring § 111.25 What requirements apply to the components, dietary ingredients, dietary equipment and utensils you use? device, or temperature-recording device supplements, or contact surfaces; that shows the temperature accurately (a)(1) You must use equipment and (4) Fans and other air-blowing within the compartment; and equipment located and operated in a utensils that are of appropriate design, (ii) Must have an automatic device for manner that minimizes the potential for construction, and workmanship to regulating temperature or an automatic microorganisms and particulate matter enable them to be suitable for their alarm system to indicate a significant to contaminate components, dietary intended use and to be adequately temperature change in a manual ingredients, dietary supplements, or cleaned and properly maintained. operation. contact surfaces; Equipment and utensils include, but are (6) Instruments or controls used in the (5) Equipment that controls not limited to, the following: manufacturing, packaging, or holding of temperature and humidity; and (i) Equipment used to hold or convey; a dietary ingredient or dietary (ii) Equipment used to measure; (6) Aisles or working spaces between (iii) Equipment using compressed air supplement, including but not limited equipment and walls that are adequately or gas; to, instruments or controls you use to unobstructed and of adequate width to (iv) Equipment used to carry out measure, regulate, or record permit all persons to perform their processes in closed pipes and vessels; temperatures, hydrogen ion duties and to protect against and concentration (pH), water activity, or contamination of components, dietary (v) Equipment used in automatic, other conditions that control or prevent ingredients, dietary supplements, or mechanical, or electronic systems. the growth of microorganisms or other contact surfaces with clothing or (2) You must use equipment and contamination must be: personal contact. utensils of appropriate design and (i) Accurate and precise; (e) Provide adequate light in: construction so that use will not result (ii) Adequately maintained; and (1) All areas where components, in the contamination of components, (iii) Adequate in number for their dietary ingredients, or dietary dietary ingredients, or dietary designated uses. supplements are examined, processed, supplements with: (7) Compressed air or other gases you or held; (i) Lubricants; introduce mechanically into or onto a (2) All areas where contact surfaces (ii) Fuel; component, dietary ingredient, dietary are cleaned; and (iii) Coolants; supplement, or contact surface or that (3) Hand-washing areas, dressing and (iv) Metal or glass fragments; you use to clean any contact surface locker rooms, and bathrooms. (v) Filth or any other extraneous must be treated in such a way that the (f) Use safety-type light bulbs, material; component, dietary ingredient, dietary fixtures, skylights, or other glass that is (vi) Contaminated water; or supplement, or contact surface is not suspended over exposed components, (vii) Any other contaminants. contaminated. dietary ingredients, or dietary (3) All equipment and utensils you (b)(1) You must calibrate instruments supplements in any step of preparation, use must be: and controls you use in manufacturing unless otherwise constructed in a (i) Installed and maintained to or testing a component, dietary manner that will protect against facilitate cleaning the equipment, ingredient, or dietary supplement. contamination of components, dietary utensils, and all adjacent spaces; (2) You must calibrate before first use; ingredients, or dietary supplements in (ii) Corrosion-resistant if the and case of glass breakage. equipment or utensils contact (i) As specified in writing by the (g) Provide protection by any effective components, dietary ingredients, or manufacturer of the instrument and means against contamination of dietary supplements; control, or components, dietary ingredients, and (iii) Made of nontoxic materials; (ii) At routine intervals or as dietary supplements in bulk (iv) Designed and constructed to otherwise necessary to ensure the fermentation vessels, including withstand the environment of their accuracy and precision of the consideration of: intended use, the action of components, instrument and control. (1) Use of protective coverings; dietary ingredients, or dietary (c) You must: (2) Placement in areas where you can supplements, and, if applicable, (1) Establish a written procedure for eliminate harborages for pests over and cleaning compounds and sanitizing calibrating instruments and controls you around the vessels; agents; and use in manufacturing or testing a

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component, dietary ingredient, or the same dietary ingredient or dietary you use and that only authorized dietary supplement and document that supplement, you must clean and personnel institute the changes; the written procedure was followed sanitize the contact surfaces as (4) Establish and use appropriate each time a calibration is performed, or necessary. controls to ensure that the equipment (2) Document at the time of (4) You must clean surfaces that do functions in accordance with its performance that the instrument and not touch components, dietary intended use. These controls must be control calibration established in ingredients, or dietary supplements as approved by your quality control unit; accordance with this section was frequently as necessary to protect and performed. against contaminating components, (5) Make and keep backup file(s) of (d) You must identify the following dietary ingredients, or dietary software programs and of data entered for calibrating instruments and controls supplements. into your computer system. Your in any written procedure or at the time (5) Single-service articles (such as backup file (e.g., a hard copy of data you of performance: utensils intended for one-time use, have entered, diskettes, tapes, (1) The instrument or control paper cups, and paper towels) must be: microfilm, or compact disks) must be an calibrated; (i) Stored in appropriate containers; exact and complete record of the data (2) The date of calibration; and you entered. You must keep your (3) The reference standard used (ii) Handled, dispensed, used, and backup software programs and data including the certification of accuracy of disposed of in a manner that protects secure from alterations, inadvertent the known reference standard and a against contamination of components, erasures, or loss. history of recertification of accuracy; dietary ingredients, dietary (c) You must keep automatic, (4) The calibration method used supplements, or any contact surface. mechanical, or electronic equipment including appropriate limits for (6) Cleaning compounds and records required by this section in accuracy and precision of instruments sanitizing agents must be adequate for accordance with § 111.125. and controls when calibrating; intended use and safe under condition (5) The calibration reading or readings of use; § 111.50 [Redesignated as § 111.72 and found; and (7) You must store cleaned and Amended] (6) The recalibration method used if sanitized portable equipment and 7. Redesignate § 111.50 as § 111.72 accuracy or precision or both accuracy utensils that have contact surfaces in a and transfer it to a new subpart E, and precision limits for instruments and location and manner that protects them Production and Process Controls, and controls were not met; and from contamination. revise the section heading to read as (7) The initials of the person who (f) You must keep calibration records follows: performed the calibration. as required by this section in (d) You must repair or replace accordance with § 111.125. § 111.72 What requirements apply to instruments or controls that cannot be packaging of iron-containing dietary adjusted to agree with the reference § 111.30 What requirements apply to supplements? standard. automatic, mechanical, or electronic * * * * * (e)(1) You must maintain, clean, and equipment? 8. Add §§ 111.35 through 111.70 and sanitize as necessary, all equipment, (a) When you use automatic, § 111.74 to newly added subpart E to utensils, and any other contact surfaces mechanical, or electronic equipment to read as follows: that are used to manufacture, package, manufacture, package, label, and hold a or hold components, dietary dietary ingredient or dietary § 111.35 What production and process ingredients, or dietary supplements. supplement, you must: controls must you use? Equipment and utensils must be taken (1) Design or select equipment to (a) You must implement a system of apart as necessary for thorough ensure that dietary ingredient or dietary production and process controls that maintenance, cleaning, and sanitizing. supplement specifications are covers all stages of manufacturing, (2) You must ensure that all contact consistently achieved and packaging, labeling, and holding of the surfaces used for manufacturing or (2) Determine the suitability of your dietary ingredients and dietary holding of low-moisture components, equipment by ensuring that your supplements. dietary ingredients, or dietary equipment is capable of operating (b) Your production and in-process supplements are in a dry and sanitary satisfactorily within the operating limits control system must be designed to condition at the time of use. When the required by the process. ensure that the dietary ingredient or surfaces are wet-cleaned, they must be (b) For any automatic, mechanical, or dietary supplement is manufactured, sanitized, when necessary, and electronic equipment you use, you packaged, and held in a manner that thoroughly dried before subsequent use. must: will prevent adulteration of the dietary (3) If you use wet processing during (1) Routinely calibrate, inspect, or ingredient or dietary supplement. The manufacturing, you must clean and check to ensure proper performance. production and in-process control sanitize all contact surfaces, as Your quality control unit must approve system must include all requirements of necessary, to protect against the these calibrations, inspections, or this subpart and must be reviewed and introduction of microorganisms into checks; approved by the quality control unit. components, dietary ingredients, or (2) Make and keep written records of (c) You must use a quality control dietary supplements. When cleaning equipment calibrations, inspections, or unit in your manufacturing, packaging, and sanitizing is necessary, you must checks; and label operations for producing the clean and sanitize all contact surfaces (3) Establish and use appropriate dietary ingredient or dietary supplement before use and after any interruption controls, to ensure that your quality to ensure that these operations are during which the contact surface may control unit approves changes in the performed in a manner that prevents have become contaminated. If you use master manufacturing record, batch adulteration and ensures that the dietary contact surfaces in a continuous control records, packaging operations ingredient or dietary supplement meets production operation or in back-to-back and label operations, or changes to other specifications for identity, purity, operations involving different batches of operations related to the equipment that quality, strength, and composition.

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(d) Any substance, other than a (g) You must ensure, through testing (ii) If any step established in the ‘‘dietary ingredient’’ within the meaning or examination, that each specification master manufacturing record is not of section 201(ff) of the Federal Food, that you established under paragraph (e) completed; Drug, and Cosmetic Act (the Act), the of this section is met. Specific testing (iii) If there is any unanticipated intended use of which results or may requirements are as follows: occurrence during the manufacturing reasonably be expected to result, (1) You must test each finished batch operations that adulterates or may lead directly or indirectly, in its becoming a of the dietary ingredient or dietary to adulteration of the component, component or otherwise affecting the supplement produced before releasing dietary ingredient, dietary supplement, characteristics of the dietary ingredient for distribution to determine whether packaging, or label; or dietary supplement must be: established specifications for identity, (iv) If calibration of an instrument or (1) Authorized for use as a food purity, quality, strength, and control suggests a problem that may additive under section 409 of the Act; or composition are met, provided that have caused batches of a dietary (2) Authorized by a prior sanction there are scientifically valid analytical ingredient or dietary supplement to consistent with § 170.3(l) of this methods available to conduct such become adulterated; or chapter; or testing. (v) If a dietary ingredient or dietary (3) If used as a color additive, subject (2) For any specification for identity, supplement is returned. to a listing that, by the terms of that purity, quality, strength, or composition (4) For any deviation or unanticipated listing, includes the use in a dietary for which you document cannot be occurrence which resulted in or could supplement; or tested on the finished batch of a dietary lead to adulteration of the component, (4) Generally recognized as safe ingredient or dietary supplement, dietary ingredient, dietary supplement, (GRAS) for use in a dietary ingredient or because there is no scientifically valid packaging, or label: dietary supplement. Any claim that a analytical method available for such (i) You must reject the component, substance is GRAS, other than a dietary testing, then you must: dietary ingredient, dietary supplement, ingredient within the meaning of (i) Perform testing on each shipment packaging, or label, unless the quality section 201(ff) of the Act, must be lot of components, dietary ingredients control unit determines that in-process supported by a citation to the agency’s or dietary supplements received to adjustments are possible to correct the regulations or by an explanation for why determine whether such specification is deviation or occurrence; there is general recognition of safety of met; and (ii) You must not reprocess a rejected the use of the substance in a dietary (ii) Perform testing in-process in component, dietary ingredient, or ingredient or dietary supplement; and accordance with the master dietary supplement unless approved by (5) Must comply with all other manufacturing record where control is the quality control unit; and applicable statutory and regulatory necessary to ensure the identity, purity, (iii) You must not reprocess any requirements under the Act. quality, strength, and composition of component, dietary ingredient or dietary (e) You must establish a specification dietary ingredients or dietary supplement if it is rejected because of for any point, step, or stage in the supplements; and contamination with microorganisms or manufacturing process where control is (3) Your quality control unit must other contaminants, such as heavy necessary to prevent adulteration. determine when finished batch testing metals; Specifications must be established for: cannot be completed for any (5) Have your quality control unit (1) The identity, purity, quality, specification on the identity, purity, review and approve any material review strength, and composition of quality, strength, and composition of and disposition decision described in components, dietary ingredients, or dietary ingredients or dietary paragraphs (i)(2) and (i)(3) of this dietary supplements that you receive; supplements. section. (2) The in-process controls in the (h) You must use an appropriate test (j) The person who conducts the master manufacturing record where or examination to determine whether material review and makes the control is necessary to ensure the your specifications are met. An disposition decision must, at the time of identity, purity, quality, strength, and appropriate test is one that is a performance, document every material composition of dietary ingredients or scientifically valid analytical method. review and disposition decision in dietary supplements; (i) You must: paragraph (i) of this section. The (3) The identity, purity, quality, (1) Establish corrective action plans documentation must be included in the strength, and composition of the dietary for use when an established appropriate batch production record ingredient or dietary supplement that specification is not met; and must: you manufacture; and (2) Review the results of the (1) Identify the specific deviation (4) The dietary ingredient or dietary monitoring required by this section and from the specification or the supplement labels and the packaging conduct a material review of any unanticipated occurrence; that may come in contact with dietary component, dietary ingredient, dietary (2) Describe your investigation into ingredients and dietary supplements. supplement, packaging or label for the cause of the deviation from the The packaging must be safe and suitable which you establish a specification that specification or the unanticipated for its intended use and comply with all is not met, or any unanticipated occurrence; other applicable statutory and occurrence that adulterates or could (3) Evaluate whether or not the regulatory requirements under the Act result in adulteration of the component, deviation from the specification or and must not be reactive or absorptive dietary ingredient, dietary supplement, unanticipated occurrence has resulted so as to affect the safety of the dietary packaging, or label; and in or could lead to adulteration; ingredient and dietary supplement. (3) Make a material disposition (4) Identify the action(s) taken to (f) You must monitor the in-process decision for any component, dietary correct and prevent a recurrence of the control points, steps, or stages to ensure ingredient, dietary supplement, deviation or the unanticipated that specifications established under packaging, or label: occurrence; and paragraph (e) of this section are met and (i) If a component, dietary ingredient, (5) Discuss what you did with the to detect any unanticipated occurrence dietary supplement, packaging, or label component, dietary ingredient, dietary that may result in adulteration; fails to meet specifications; supplement, packaging, or label.

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(k) You must test or examine (b) Your quality control unit must do supplements to determine that you used components, dietary ingredients, and the following: the packaging specified in the master dietary supplements for those types of (1) Approve or reject all processes, manufacturing record and applied the contamination that may adulterate or specifications, controls, tests, and label specified in the master may lead to adulteration. You must use examinations, and deviations from or manufacturing record. an appropriate scientifically valid modifications to them, that may affect (12) Keep the reserve samples for 3 method for the test or examination. The the identity, purity, quality, strength, years from the date of manufacture for types of contamination include, but are and composition of a dietary ingredient use in appropriate investigations not limited to, the following: or dietary supplement; including, but not limited to, consumer (1) Filth, insects, or other extraneous (2) Determine whether all complaint investigations to determine, material; components, dietary ingredients, dietary for example, whether the dietary (2) Microorganisms; and supplements, packaging, and labels ingredient or dietary supplement (3) Toxic substances. conform to specifications; associated with a consumer complaint (l) Tests in accordance with this (3) Approve or reject all components, failed to meet any of its specifications section must include at least one of the dietary ingredients, dietary for identity, purity, quality, strength, following: supplements, packaging, and labels; and composition. The reserve samples (1) Gross organoleptic analysis; (4) Review and approve all master must: (2) Microscopic analysis; manufacturing records and all (i) Be identified with the batch or lot (3) Chemical analysis; or modifications to the master number; and (4) Other appropriate test. manufacturing records; (ii) Consist of at least twice the (m) You must record results of all (5) Review and approve all batch quantity necessary for tests. testing and examinations performed in production-related records which (13) Perform appropriate tests and accordance with this section. If a test or include, but are not limited to, cross examinations of: examination is performed on a batch referencing receiving and batch (i) Components, dietary ingredients, production you must record the test or production records, approval of a dietary supplements, packaging, and examination result in the batch material review and disposition labels received to ensure that they meet production record in accordance with decision, approval for reprocessing, and specifications; § 111.50(c)(10). Your records must approval for releasing for distribution; (ii) Dietary ingredient and dietary document whether the testing and (6) Review and approve all processes supplement batch production at points, examination demonstrates that for calibrating instruments or controls; steps, or stages identified in the master specifications are met. (7) Review all records for calibration manufacturing record where control is (n) For any specification that is not of instruments, apparatus, gauges, and necessary to prevent adulteration; met, you must conduct a material recording devices; (iii) Dietary ingredients and dietary review and disposition decision under (8) Review all records for equipment supplements that you manufacture to paragraph (i) of this section. calibrations, inspections, and checks; ensure that they meet specifications; (o) You must make and retain records, (9) Review and approve all laboratory and in accordance with § 111.125, to ensure control processes, and testing results; (iv) Packaged and labeled dietary that you follow the requirements of this (10) Review and approve all ingredients and dietary supplements to section. The records must include, but packaging and label records which ensure that you used the packaging are not limited to: include, but are not limited to, cross- specified in the master manufacturing (1) The specifications established; referencing receiving and batch record and you applied the label (2) The actual results obtained during production records, approval for specified in the master manufacturing the monitoring operation; record. (3) Any deviation from specifications repackaging and relabeling, and approval for releasing for distribution; (14) Review and approve all material and any unanticipated occurrences; review and disposition decisions; and (4) Any corrective actions taken; (11) Collect representative samples of: (i) Each shipment lot of components, (15) Approve the reprocessing or (5) The disposition decisions and distribution of returned dietary followup; and dietary ingredients, dietary supplements, packaging, and labels ingredients or dietary supplements. (6) The identity of the individual (c) Your quality control unit must qualified by training and experience received to determine whether the component, dietary ingredient, dietary establish and maintain written who investigated any deviation from documentation at the time of specifications or unanticipated supplement, packaging, or labels meet specifications; performance that it performed the occurrence and the identity of the review, approval, or rejection individual from the quality control unit (ii) Inprocess materials at points, steps, or stages, in the manufacturing requirements of this section by who reviewed the results of that recording the following: investigation. process as specified in the master manufacturing record where control is (1) Date the required review, § 111.37 What requirements apply to necessary to ensure the identity, purity, approval, or rejection was performed; quality control? quality, strength, and composition of and (a) You must use a quality control dietary ingredients or dietary (2) Signature of the person performing unit to ensure that your manufacturing, supplements; the requirement. (d) You must keep quality control packaging, label, and holding operations (iii) Each batch of dietary ingredient records in accordance with § 111.125. in the production of dietary ingredients or dietary supplement manufactured to and dietary supplements are performed determine, before releasing for § 111.40 What requirements apply to in a manner that prevents adulteration distribution, whether the dietary components, dietary ingredients, dietary and misbranding, including ensuring ingredient or dietary supplement meets supplements, packaging, and labels you that dietary ingredients and dietary its specifications for identity, purity, receive? supplements meet specifications for quality, strength, and composition; and (a) For components, dietary identity, purity, quality, strength, and (iv) Each batch of packaged and ingredients, or dietary supplements you composition. labeled dietary ingredients or dietary receive, you must:

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(1) Visually examine each container release packaging and labels from each dietary ingredient for each batch or grouping of containers in a shipment quarantine before you use them; size; for appropriate content label, container (3) Identify each shipment lot of (2) A complete list of components to damage, or broken seals to determine packaging and labels in a manner that be used; whether the container condition has allows you to trace the shipment lot to (3) An accurate statement of the resulted in contamination or the supplier, the date received, the weight or measure of each component to deterioration of the components, dietary name of the packaging and label and the be used; ingredients, or dietary supplement; status (e.g., quarantined, approved, or (4) The identity and weight or (2) Visually examine the suppliers rejected) and to trace the shipment lot measure of each dietary ingredient that invoice, guarantee, or certification to to the dietary ingredient or dietary will be declared on the Supplement ensure that the components, dietary supplement manufactured and Facts label and the identity of each ingredients, or dietary supplements are distributed. You must use this unique ingredient that will be declared on the consistent with your purchase order and identifier whenever you record the ingredients list of the dietary perform testing, as needed, to determine disposition of each shipment lot supplement in compliance with section whether specifications are met. received; and 403(s) of the Federal Food, Drug, and (3) Quarantine components, dietary (4) Hold packaging and labels under Cosmetic Act; (5) A statement that explains any ingredients, or dietary supplements conditions that will protect against intentional excess amount of a dietary until your quality control unit reviews contamination, deterioration, and avoid mixups. ingredient; the suppliers invoice, guarantee, or (6) A statement of theoretical yield of certification and performs testing, as (c)(1) The person who performs the component, dietary ingredient, dietary a manufactured dietary ingredient or needed, of a representative sample to dietary supplement expected at each supplement, packaging, or label determine that specifications are met. If point, step, or stage of the requirements of this section must specifications are not met, you must manufacturing process where control is document, at the time of performance, conduct a material review and make a needed to prevent adulteration, and the that the requirements were followed. disposition decision. Your quality expected yield when you finish The documentation must include, but control unit must approve and release manufacturing the dietary ingredient or not be limited to: the components, dietary ingredients, dietary supplement, including the (i) The date that the components, and dietary supplements from maximum and minimum percentages of dietary ingredients, dietary quarantine before you use them; theoretical yield beyond which a supplements, packaging, or labels were (4) Identify each lot of components, deviation investigation of a batch is received; dietary ingredients, or dietary performed and material review is (ii) The signature of the person supplements in a shipment in a manner conducted and disposition decision is performing the requirement; that allows you to trace the shipment to made; the supplier, the date received, the (iii) Any test results; and (7) A description of packaging and a (iv) Any material review and name of the component or dietary copy of the label to be used; and supplement, and the status (e.g., disposition decision you conducted in (8) Written instructions including, but quarantined, approved, or rejected) and accordance with § 111.35(i) and not limited to, the following: to trace the shipment lot to the dietary disposition of any rejected material (i) Specifications for each point, step, ingredient or dietary supplement under § 111.74. or stage in manufacturing the dietary manufactured and distributed. You (2) You must keep component, dietary ingredient or dietary supplement must use this unique identifier supplement, packaging, and label necessary to prevent adulteration; whenever you record the disposition of receiving records in accordance with (ii) Sampling and testing procedures; each shipment lot received; and § 111.125. (iii) Specific actions necessary to (5) Hold components, dietary § 111.45 What requirements apply to perform and verify points, steps, or ingredients, or dietary supplements establishing a master manufacturing stages, necessary to meet specifications under conditions that will protect record? and otherwise prevent adulteration, against contamination, deterioration, (a) You must prepare and follow a including, but not limited to, one person and avoid mixups. written master manufacturing record for weighing or measuring a component (b) For packaging and labels you each type of dietary ingredient or and another person verifying the weight receive, you must: dietary supplement that you or measure and one person adding the (1) Visually examine each container manufacture and for each batch size to component and another person or grouping of containers in a shipment ensure uniformity from batch to batch. verifying the addition; (iv) Special notations and precautions for appropriate content label, container The master manufacturing record must: to be followed; and damage, or broken seals to determine (1) Identify specifications for the (v) Corrective action plans for use whether the container condition has points, steps, or stages in the resulted in contamination or when a specification is not met. manufacturing process where control is (c) You must have the quality control deterioration of the packaging and necessary to prevent adulteration; and unit review and approve each master labels; (2) Establish controls and procedures manufacturing record and any (2) Quarantine packaging and labels to ensure that each batch of dietary modifications to a master manufacturing until your quality control unit tests or ingredient or dietary supplement record. examines a representative sample to manufactured meets those (d) You must keep master determine that specifications are met. specifications. manufacturing records in accordance You must conduct at least a visual (b) The master manufacturing record with § 111.125. identification on the containers and must include the following information: closures. If specifications are not met, (1) The name of the dietary ingredient § 111.50 What requirements apply to you must conduct a material review and or dietary supplement to be establishing a batch production record? make a disposition decision. Your manufactured and the strength, (a) You must prepare a batch quality control unit must approve and concentration, weight, or measure of production record every time you

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manufacture a batch of a dietary record review and any approval for from the date of manufacture for use in ingredient or dietary supplement and reprocessing or repackaging. appropriate investigations including, the batch production record must (d) The quality control unit must but not limited to, consumer complaint include complete information relating to review in accordance with § 111.37(b)(5) investigations to determine whether, for the production and control of each the batch production record established example, the dietary ingredient or batch. in paragraph (c) of this section. dietary supplement associated with a (b) Your batch production record (1) If a batch deviates from the master consumer complaint failed to meet any must accurately follow the appropriate manufacturing record, including any of its specifications for identity, purity, master manufacturing record and you deviation from specifications, the quality, strength, and composition; and must perform each step in producing quality control unit must conduct a (i) You must keep batch production the batch. material review and make a disposition records in accordance with § 111.125. (c) The batch production record must decision and record any decision in the include, but is not limited to, the batch production record. § 111.60 What requirements apply to following information: (2) The quality control unit must not laboratory operations? (1) The batch, lot, or control number; approve and release for distribution any (a) You must use adequate laboratory (2) Documentation at the time of batch of dietary ingredient or dietary facilities to perform whatever testing performance, showing the date on supplement that does not meet all and examinations are necessary to which each step of the master specifications. determine that components, dietary manufacturing record was performed, (e) The quality control unit must ingredients, and dietary supplements and the initials of the persons document in accordance with received meet specifications; that performing each step, including but not § 111.37(c) the review performed in specifications are met during in-process, limited to: accordance with paragraph (d) of this as specified in the master manufacturing (i) The person responsible for section and it must be documented at record; and that dietary ingredients and weighing or measuring each component the time of performance. The review dietary supplements manufactured meet used in the batch; and and documentation must include, but is specifications. (ii) The person responsible for adding not limited to, the following: (b)(1) You must establish and follow the component to the batch. (1) Review of component, dietary laboratory control processes that are (3) The identity of equipment and ingredient, and dietary supplement approved by the quality control unit. processing lines used in producing the receiving records including review of Laboratory control processes must batch; testing and examination results; include, but are not limited to, the (4) The date and time of the (2) Identification of any deviation following: maintenance, cleaning, and sanitizing of from the master manufacturing record (i) Use of criteria for selecting the equipment and processing lines that may have caused a batch or any of appropriate examination and testing used in producing the batch; its components to fail to meet methods; (5) The shipment lot unique identifier specifications identified in the master (ii) Use of criteria for establishing of each component, dietary ingredient, production record; appropriate specifications; and dietary supplement, packaging, and (3) Records of investigations, (iii) Use of sampling plans for label used; (6) The identity and weight or conclusions, and corrective actions obtaining representative samples of: (A) Components, dietary ingredients, measure of each component used; performed in accordance with (7) The initials at the time of paragraph (d) of this section; and and dietary supplements received to performance or at the completion of the (4) The identity of the person determine whether specifications are batch of the person responsible for qualified by training and experience met; verifying the weight or measure of each who performed the investigation in (B) In-process materials during the component used in the batch; accordance with paragraph (d) of this batch manufacturing when testing or (8) The initials at the time of section. examination is required in the master performance or at the completion of the (f) You must not reprocess a batch manufacturing record; batch of the person responsible for that deviates from the master (C) Each batch of dietary ingredient or verifying the addition of components to manufacturing record unless approved dietary supplement manufactured to the batch; by the quality control unit. You must determine that the dietary ingredient or (9) A statement of the actual yield and not reprocess a dietary ingredient or dietary supplement meets a statement of the percentage of dietary supplement if it is rejected specifications; theoretical yield at appropriate phases because of contamination with (D) Packaging and labels received to of processing; microorganisms of public health determine that the materials meet (10) The actual test results for any significance or other contaminants, such specifications; and testing performed during the batch as heavy metals; (E) Each batch of packaged and production; (g) Any batch of dietary ingredient or labeled dietary ingredients or dietary (11) Documentation that the dietary dietary supplement that is reprocessed supplements to ensure that the label ingredient and dietary supplement must meet all specifications for the specified in the master manufacturing meets specifications; batch of dietary ingredient or dietary record has been applied. (12) Copies of all container labels supplement and be evaluated and (iv) Use of criteria for selecting used and the results of examinations approved by the quality control unit standard reference materials used in conducted during the label operation to before releasing for distribution. The performing tests and examinations; ensure that the containers have the results of the reevaluation by the quality (v) Use of appropriate test method correct label; control unit must be documented in the validations; and (13) Any documented material review batch production record; (vi) Use of test methods and and disposition decision in accordance (h) You must collect representative examinations in accordance with with § 111.35(j); and reserve samples of each batch of dietary established criteria. (14) Signature of the quality control ingredient or dietary supplement and (2) The person who conducts the unit to document batch production keep the reserve samples for 3 years testing and examination at the time of

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performance, must document that that can support the rapid growth of holding dietary ingredients or dietary laboratory methodology established in microorganisms of public health supplements meets specifications so accordance with this section is significance in a manner that prevents that the condition of the packaging followed. The documentation must the components, dietary ingredients, container will not contaminate your include the testing and examination and dietary supplements from becoming dietary ingredients or dietary results. adulterated; supplements nor cause them to (3) You must keep laboratory (7) Identifying and holding any deteriorate; examination and testing records in components, dietary ingredients, or (b) You must fill, assemble, package, accordance with § 111.125. dietary supplements, for which a and perform other related operations in (c) You must verify that the laboratory material review and disposition a way that protects your dietary examination and testing methodologies decision is required, in a manner that ingredients or dietary supplements are appropriate for their intended use. protects the components, dietary against adulteration and misbranding. (d) You must identify and use the ingredients, or dietary supplements You must do this using any effective appropriate validated testing method for against contamination and mixups; means, including but not limited to, the each established specification for which (8) Performing mechanical following: testing is required to determine whether manufacturing steps (such as cutting, (1) Cleaning and sanitizing all filling the specification is met. sorting, inspecting, shredding, drying, and packaging equipment, utensils, and grinding, blending, and sifting) by any dietary ingredient or dietary supplement § 111.65 What requirements apply to effective means to protect the dietary containers, as appropriate; manufacturing operations? ingredients or dietary supplements (2) Protecting manufactured dietary (a) You must design or select against contamination. Such steps must ingredients and dietary supplements manufacturing processes to ensure that include consideration of: from contamination, particularly dietary ingredient or dietary supplement (i) Cleaning and sanitizing contact airborne contamination; specifications are consistently achieved. surfaces; (3) Using sanitary handling (b) You must conduct all (ii) Using temperature controls; and procedures; manufacturing operations in accordance (iii) Using time controls. (4) Establishing physical or spatial with adequate sanitation principles. (9) Using effective measures to protect separation of packaging and labels from (c) You must take all the necessary against the inclusion of metal or other operations on other dietary ingredients precautions during the manufacture of a foreign material in components, dietary and dietary supplements to prevent dietary ingredient or dietary supplement ingredients, or dietary supplements. mixups; to prevent contamination of Compliance with this requirement must (5) Identifying, by any effective components, dietary ingredients, or include consideration of the use of: means, filled dietary ingredient or dietary supplements. These precautions (i) Filters or strainers; dietary supplement containers that are (ii) Traps; include, but are not limited to: set aside and held in unlabeled (1) Performing manufacturing (iii) Magnets; or (iv) Electronic metal detectors. condition for future label operations, to operations under conditions and (10) Segregating and identifying all prevent mixups; controls that protect against the containers for a specific batch of dietary (6) Identifying the dietary ingredient potential for growth of microorganisms ingredients or dietary supplements to or dietary supplement with a batch, lot, and the potential for contamination; identify their contents and, where or control number that can be used to (2) Washing or cleaning components necessary, the phase of manufacturing; determine the manufacturing history that contain soil or other contaminants; and and control of the batch; (3) Using water that meets the (11) Identifying all processing lines (7) Examining a representative sample National Primary Drinking Water and major equipment used during of each batch of the packaged and regulations or, where necessary, higher manufacturing to indicate their contents labeled dietary ingredient or dietary sanitary quality and that complies with including the name of the dietary supplement to ensure that the dietary all applicable Federal, State, and local ingredient or dietary supplement and ingredient or dietary supplement meets regulations for water that is used in the the specific batch or lot number and, specifications and that the label manufacturing operation. If you reuse when necessary, the phase of specified in the master manufacturing water that was used to wash manufacturing. record has been applied; and components to remove soil or (d) You must conduct a material (8) Suitably disposing of labels and contaminants, the reused water must be review and make a disposition decision other packaging for dietary ingredients safe and of adequate sanitary quality so in accordance with § 111.35(i) for any or dietary supplements that are obsolete that it does not become a source of component, dietary ingredient, or or incorrect to ensure that they are not contamination; dietary supplement that fails to meet used in any future packaging and label (4) Performing chemical, specifications or that is or may be operations. microbiological, or other testing, as adulterated. If the material review and (c) You must conduct a material necessary to prevent the use of disposition decision allows you to review and make a disposition decision contaminated components, dietary reprocess the component, dietary of any packaged and labeled dietary ingredients, and dietary supplements; ingredient, or dietary supplement, you ingredients or dietary supplements that (5) Sterilizing, pasteurizing, freezing, must retest or reexamine the do not meet specifications. refrigerating, controlling hydrogen-ion component, dietary ingredient, or (d) You must only repackage or concentration (pH), controlling dietary supplement to ensure that it relabel dietary ingredients or dietary humidity, controlling water activity meets specifications and is approved by supplements after the quality control (aw), or using any other effective means the quality control unit. unit has approved and documented to remove, destroy, or prevent the such repackaging or relabeling. growth of microorganisms and prevent § 111.70 What requirements apply to (e) You must retest or reexamine any decomposition; packaging and label operations? repackaged or relabeled dietary (6) Holding components, dietary (a) You must take necessary actions to ingredients or dietary supplements. ingredients, and dietary supplements ensure that each packaging container for They must meet all specifications and

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the quality control unit must approve or Subpart F—Holding and Distributing supplements until the quality control reject their release for distribution. unit conducts a material review and § 111.80 What requirements apply to makes a disposition decision. (f)(1) You must control the issuance holding components, dietary ingredients, and use of packaging and labels and (b) You must not salvage returned dietary supplements, packaging, and dietary ingredients and dietary reconciliation of any issuance and use labels? discrepancies; and supplements, unless: (a) You must hold components, (1) Evidence from their packaging (or, (2) You must examine, before dietary ingredients, and dietary if possible, an inspection of the packaging operations, packaging and supplements under appropriate premises where the dietary ingredients labels for each batch of dietary conditions of temperature, humidity, and dietary supplements were held) ingredient or dietary supplement to and light so that the identity, purity, indicates that the dietary ingredients ensure that the label and packaging quality, strength, and composition of the and dietary supplements were not conform to the master manufacturing components, dietary ingredients, and subjected to improper storage record. dietary supplements are not affected. conditions; and (g) The person that performs the (b) You must hold packaging and (2) Tests demonstrate that the dietary requirements of this section must labels under appropriate conditions of ingredients or dietary supplements meet document at the time of performance temperature, humidity, and light so that all specifications for identity, purity, that the requirements are performed the quality of the packaging and labels quality, strength, and composition. including, but not limited to, are not affected. (c) You must destroy or suitably documentation in the batch production (c) You must hold components, dispose of the returned dietary record of: dietary ingredients, dietary ingredients or dietary supplements if supplements, packaging, and labels (1) The identity and quantity of the such dietary ingredients or dietary under conditions that do not lead to the packaging and labels used and supplements do not meet specifications mixup, contamination, or deterioration reconciliation of any discrepancies for identity, purity, quality, strength, of components, dietary ingredients, between issuance and use; and composition, unless the quality dietary supplements, packaging, and control unit conducts a material review (2) The examination conducted in labels. and makes a disposition decision to accordance with paragraph (b)(7) of this allow reprocessing. section; § 111.82 What requirements apply to (d) If the reason for a dietary holding in-process material? (3) The conclusions you reached from ingredient or a dietary supplement retests conducted in accordance with (a) You must identify and hold in- being returned implicates associated paragraph (e) of this section; and process material under conditions that batches, you must conduct an will protect them against mixup, (4) Any material reviews and investigation of your manufacturing contamination, and deterioration. disposition decisions for packaging and processes and those other batches to (b) You must hold in-process material labels. determine compliance with under appropriate conditions of (h) You must keep packaging and specifications. temperature, humidity, and light. (e) You must establish and keep label operations records required under records for this section on the material this section in accordance with § 111.83 What requirements apply to review and disposition decision and any § 111.125. holding reserve samples of components, dietary ingredients, and dietary testing conducted to determine § 111.74 What requirements apply to supplements? compliance with established rejected components, dietary ingredients, (a) For any reserve samples of specifications in the master dietary supplements, packaging, and components or dietary ingredients you manufacturing record for the type of labels? collect, you must hold such reserve dietary ingredient or dietary supplement You must clearly identify, hold, and samples in a manner that protects that was returned. control under a quarantine system any against contamination and deterioration. (f) You must keep returned dietary component, dietary ingredient, dietary (b) You must hold reserve samples of ingredient and dietary supplement supplement, packaging, and label that is dietary supplements in a manner that records in accordance with § 111.125. rejected and unsuitable for use in protects against contamination and § 111.90 What requirements apply to manufacturing, packaging, or label deterioration. This includes, but is not distributing dietary ingredients or dietary operations. limited to: supplements? 9. Add subpart F to part 111 to read (1) Holding the reserve samples under Distribution of dietary ingredients and as follows: conditions of use recommended or dietary supplements must be under suggested in the label of the dietary conditions that will protect the dietary Subpart F—Holding and Distributing supplement and, if no conditions of use ingredients and dietary supplements Sec. are recommended or suggested in the against contamination and deterioration. 111.80 What requirements apply to holding label, then under ordinary conditions of 10. Add subpart G to part 111 to read components, dietary ingredients, dietary use; and as follows: supplements, packaging, and labels? (2) Using the same container-closure 111.82 What requirements apply to holding system in which the dietary supplement Subpart G—Consumer Complaints in-process material? is marketed or in one that provides the 111.83 What requirements apply to holding § 111.95 What requirements apply to reserve samples of components, dietary same level of protection against consumer complaints? contamination or deterioration. ingredients, and dietary supplements? (a) A qualified person must review all 111.85 What requirements apply to § 111.85 What requirements apply to returned dietary ingredients or dietary consumer complaints to determine returned dietary ingredients or dietary supplements? whether the consumer complaint supplements? 111.90 What requirements apply to involves a possible failure of a dietary distributing dietary ingredients or (a) You must identify and quarantine ingredient or dietary supplement to dietary supplements? returned dietary ingredients or dietary meet any of its specifications, or any

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other requirements of this part, dietary ingredient independent of (b) Records required under this part including those specifications and other whether the product is produced under must be kept as original records, as true requirements that, if not met, may result good manufacturing practices. The copies (such as photocopies, microfilm, in a possible risk of illness or injury. consumer complaint written record microfiche, or other accurate (b) Your quality control unit must must include, but is not limited to, the reproductions of the original records), or review all consumer complaints following: as electronic records. If you use involving the possible failure of a (1) The name and description of the reduction techniques, such as dietary ingredient or dietary supplement dietary ingredient or dietary microfilming, you must make suitable to meet any of its specifications, or any supplement; reader and photocopying equipment other requirements of this part, (2) The batch or lot number of the readily available to FDA. All electronic including those specifications and other dietary supplement, if available; records must comply with part 11 of requirements that, if not met, may result (3) The name of the complainant, if this chapter. in a possible risk of illness or injury, to available; (c) You must have all records required determine whether there is a need to (4) The nature of the complaint under this part, or copies of such investigate the consumer complaint. including how the consumer used the records, readily available during the (c) Your quality control unit must product; retention period for authorized investigate a consumer complaint when (5) The reply to the complainant, if there is a reasonable possibility of a any; and inspection and copying by FDA when relationship between the quality of a (6) Findings of the investigation and requested. dietary supplement and an adverse followup action taken when an 12. Part 112 is added to read as event. investigation is performed. follows: (d) Your quality control unit’s (f)(1) The person who performs the investigation of a consumer complaint requirements in accordance with this PART 112—RESTRICTIONS FOR must include the batch records section must document at the time of SUBSTANCES USED IN DIETARY associated with the dietary ingredient or performance that the requirement was SUPPLEMENTS dietary supplement involved in the performed. Subpart A—General Provisions [Reserved] consumer complaint. Your quality (2) You must keep consumer control unit must extend the complaint records in accordance with Subpart B—New Dietary Ingredients investigation to other batches of dietary § 111.125. [Reserved] ingredients or dietary supplements that 11. Add subpart H to part 111 to read Subpart C—Restricted Dietary Ingredients may have been associated with an as follows: adverse event. [Reserved] (e) You must make and keep a written Subpart H—Records and Authority: 21 U.S.C. 321, 342, 343, 371. record of every consumer complaint that Recordkeeping is related to good manufacturing Dated: January 29, 2003. practices. For the purposes of the § 111.125 What requirements apply to Mark B. McClellan, recordkeeping? regulations in this part, a consumer Commissioner of Food and Drugs. complaint about product quality may or (a) You must keep written records Dated: January 29, 2003. may not include concerns about a required by this part for 3 years beyond possible hazard to health. However, a the date of manufacture of the last batch Tommy G. Thompson, consumer complaint does not include of dietary ingredients or dietary Secretary of Health and Human Services. an adverse event, illness, or injury supplements associated with those [FR Doc. 03–5401 Filed 3–12–03; 11:30 am] related to the safety of a particular records. BILLING CODE 4160–01–P

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Part III

Environmental Protection Agency 40 CFR 439 Effluent Limitations Guidelines, Pretreatment Standards, and New Source Performance Standards for the Pharmaceutical Manufacturing Point Source Category; Direct Final Rule and Proposed Rule

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ENVIRONMENTAL PROTECTION standards established in the 1998 ADDRESSES: Comments may be AGENCY regulation. Second, this rule re- submitted electronically, by mail, or establishes a minimum concentration through hand delivery/courier. Please 40 CFR Part 439 for the maximum monthly average BOD5 mail comments to the Water Docket, [FRL–7462–8] limitation that EPA inadvertently Environmental Protection Agency, omitted from the Best Practicable Mailcode: 4101T, 1200 Pennsylvania Effluent Limitations Guidelines, Control Technology (BPT) requirements Avenue, NW., Washington, DC, 20460 Pretreatment Standards, and New in two subcategories of the 1998 or submit them electronically to http:// Source Performance Standards for the regulation. Next, the amendments www.epa.gov/edocket. Send either to Pharmaceutical Manufacturing Point correct an error in EPA’s pass-through the Attention of Docket ID No. OW– Source Category analysis prepared in support of the 1998 2003–0007. See section I.C., of the rule and, as a result, deletes methyl SUPPLEMENTARY INFORMATION section for AGENCY: Environmental Protection Cellosolve (2-methoxyethanol) from the Agency. more information on submitting pretreatment standards in two comments. ACTION: Direct final rule. subcategories and from Appendix A, FOR FURTHER INFORMATION CONTACT: Dr. SUMMARY: The Environmental Protection Table 2, ‘‘Surrogate Parameters for Agency (EPA) is taking direct final Indirect Dischargers.’’ Finally, the Frank Hund, EPA Office of Water by action to amend certain provisions of Agency is making other non-substantive phone at (202)566–1027 or by e-mail at the effluent guidelines for the editorial and format changes such as [email protected]. removing redundancies, and adding Pharmaceutical Manufacturing Point SUPPLEMENTARY INFORMATION: Source Category, which were published definitions. on September 21, 1998 (63 FR 50424). DATES: This rule is effective on June 11, I. General Information First, EPA is clarifying the date on 2003 without further notice, unless EPA A. Regulated Entities which a discharger subject to the New receives adverse comment by May 12, Source Performance Standards (NSPS) 2003. If we receive such comment, we Entities potentially regulated by this and the Pretreatment Standards for New will publish a timely withdrawal in the action include facilities of the following Sources (PSNS) would be subject to Federal Register informing the public types that discharge pollutants directly effluent limitations and pretreatment that this rule will not take effect. or indirectly to U.S. waters.

Category Examples of regulated entities SIC (NAICS) code

Industry ...... Facilities that generate process wastewater from the manufacture of pharmaceutical products 2833, R834, 2836 (2834– and/or pharmaceutical intermediates by fermentation, extraction, chemical synthesis and/or 04, 2834–98). mixing, compounding and formulating.

This table is not intended to be available for public viewing at the Water in the public docket that are available exhaustive, but rather provides a guide Docket in the EPA Docket Center, (EPA/ electronically. Once in the system, for readers regarding entities likely to be DC) EPA West, Room B102, 1301 select ‘‘search,’’ then key in the regulated by this action. This table lists Constitution Ave., NW., Washington, appropriate docket identification the types of entities that EPA is now DC. The EPA Docket Center Public number. aware could potentially be regulated by Reading Room is open from 8:30 a.m. to this action. Other types of entities not 4:30 p.m., Monday through Friday, II. Legal Authority listed in the table could also be excluding legal holidays. The telephone The U.S. Environmental Protection regulated. To determine whether your number for the Public Reading Room is Agency is promulgating these facility is regulated by this action, you (202) 566–1744, and the telephone regulations under the authority of 33 should carefully examine the definitions number for the Water Docket is (202) U.S.C. 1311, 1314, 1316, 1317, 1318, and applicability criteria in §§ 439.1, 566–2426. For access to docket 1342 and 1361. 439.10, 439.20, 439.30, 439.40 and materials, please call ahead to schedule 439.50 of title 40 of the Code of Federal an appointment. Every user is entitled III. Overview of Effluent Limitations Regulations. If you have questions to copy 100 pages before incurring a Guidelines and Standards regarding the applicability of this action charge. The Docket may charge 15 cents to a particular entity, consult the person a page for each page over the 100-page Congress adopted the Clean Water Act listed in the preceding FOR FURTHER limit. (CWA) to ‘‘restore and maintain the INFORMATION CONTACT section. 2. Electronic Access. You may access chemical, physical, and biological integrity of the Nation’s waters’’ (section B. How Can I Get Copies of This this Federal Register document 101(a), 33 U.S.C. 1251(a)). To achieve Document and Other Related electronically through the EPA Internet this goal, the CWA prohibits the Information? under the ‘‘Federal Register’’ listings at http://www.epa.gov/fedrgstr/. discharge of pollutants into navigable 1. Docket. EPA has established an An electronic version of the public waters except in compliance with the official public docket for this action docket is available through EPA’s statute. The Clean Water Act confronts under Docket ID No. OW–2003–0007. electronic public docket and comment the problem of water pollution on a The official public docket consists of the system, ‘‘EPA Dockets.’’ You may use number of different fronts. Its primary documents specifically referenced in EPA Dockets at http://www.epa.gov/ reliance, however, is on establishing this action, any public comments edocket/ to submit or view public restrictions on the types and amounts of received, and other information related comments, access the index listing of pollutants discharged from various to this action. The official public docket the contents of the official public industrial, commercial, and public is the collection of materials that is docket, and to access those documents sources of wastewater.

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Congress recognized that regulating NSPS may not be subject to more the new PSNS became effective would only those sources that discharge stringent standards during a statutorily be subject to the more stringent effluent directly into the nation’s waters prescribed period following standards. To correct this oversight, would not be sufficient to achieve the construction of such source, generally EPA is revising each of these four CWA’s goals. Consequently, the CWA 10 years. EPA first promulgated NSPS sections to read as follows: requires EPA to promulgate nationally for the Pharmaceutical Manufacturing Except as provided in 40 CFR 403.7, any applicable pretreatment standards that Point Source Category in 1983 when the new source subject to this subpart that restrict pollutant discharges for those Agency established effluent limitations commenced discharging after November 21, who discharge wastewater indirectly guidelines and pretreatment standards 1988, and prior to November 20, 1998, must through sewers flowing to publicly- for this category. When EPA continue to achieve the pretreatment owned treatment works (POTWs) promulgated revised limitations and standards specified for this section in the (section 307(b) and (c), 33 U.S.C. standards, including NSPS, for the 1988 edition of 40 CFR part 439 during a ten- 1317(b) and (c)). National pretreatment Pharmaceuticals Manufacturing Point year period beginning on the date the source standards are established for those Source Category in 1998, 40 CFR commenced discharge, or during the period pollutants in wastewater from indirect 439.15(c), 439.25(c), 439.35(c), and of depreciation or amortization of the facility, which ever comes first, after which the dischargers which may pass through or 439.45(c) provided for this protection source must achieve the same standards as interfere with POTW operations. period from more stringent standards. specified in [insert the appropriate PSES Generally, pretreatment standards are For example, paragraph (c) of § 439.15 section for the subpart]. designed to ensure that wastewater from states: direct and indirect industrial Any new source subject to the provisions V. Amendment to BOD Minimum dischargers are subject to similar levels of this section that commenced discharging Limitation of treatment. In addition, POTWs are after November 21, 1988 and prior to When EPA issued regulations for the required to implement local November 20, 1998 must continue to achieve Pharmaceutical Manufacturing Point pretreatment limits applicable to their the standards specified in the earlier version Source Category on October 27, 1983 (49 industrial indirect dischargers to satisfy of this section until the expiration of the FR 49808), the best practicable control any local requirements (40 CFR 403.5). applicable time period specified in 40 CFR Direct dischargers must comply with 122.29(d)(1), after which the source must technology (BPT) regulation in achieve the standards specified in §§ 439.13 §§ 439.22 and 439.42 provided for a effluent limitations in National and 439.14. (Emphasis supplied) Pollutant Discharge Elimination System minimum monthly average limitation (NPDES) permits; indirect dischargers In order to remove any ambiguity for BOD5, which was qualified by the must comply with pretreatment about which regulations applied to following sentence: ‘‘However, a plant standards. These limitations and dischargers constructing new facilities shall not be required to attain a standards are established by regulation and commencing discharge after the maximum 30-day average BOD5 effluent for categories of industrial dischargers 1983 regulation but before the effective limitation of less than the equivalent of and are based on the degree of control date of the 1998 regulations, EPA is 45 mg/l.’’ EPA included this provision that can be achieved using various amending the regulation. EPA is because dischargers with BOD5 levels levels of pollution control technology. amending paragraph (c) of each of the up to 100 mg/L in their raw wastewater On November 17, 1976, (41 FR 50676) four sections cited above to state clearly could not achieve the required 90% EPA promulgated ‘‘best practicable that any new source that commenced reduction of BOD5 using biological control technology currently available’’ discharging after November 21, 1988, treatment, the technological basis for the (BPT) effluent limitations guidelines for and before November 20, 1998, must limitation. Since biological treatment the Pharmaceutical Manufacturing Point continue to achieve the standards could not achieve the required Source Category. On October 27, 1983, specified for 40 CFR part 439 in the reduction for such dischargers, EPA (48 FR 49808) the Agency revised the October 27, 1983, Federal Register (48 established a qualified provision for a BPT limitations and promulgated FR 49808) (which are contained in the minimum BOD5 concentration in the additional limitations covering the ‘‘best 1988 edition of the CFR) until the 1983 regulation. available technology economically expiration of the applicable time period EPA inadvertently omitted this achievable’’ (BAT) and pretreatment and specified in 40 CFR 122.29(d)(1). qualified provision of the BOD5 new source standards for this point Thereafter, the source must comply with limitations from the final rule published source category. the applicable effluent limitations in 1998, and this language consequently On September 21, 1998, (63 FR 50388) specified in the September 21, 1998, has not been included in subsequent EPA again revised the effluent regulation (63 FR 50388). The editions of 40 CFR part 439. Today EPA limitations guidelines and standards for amendments substitute for the phrase is correcting this omission by adding to the Pharmaceutical Manufacturing Point ‘‘earlier version’’ a specific reference to §§ 439.22(a) and 439.42(a) the phrase: ‘‘ Source Category. We subsequently the 1988 edition of 40 CFR part 439. * * *, except that no facility shall be received comments from the regulated This will remove any uncertainty about required to attain a monthly average community and after our own analysis the standards with which a point source limitation for BOD5 that is less than the and review, we determined that several discharger must comply. equivalent of 45 mg/L.’’ Section 307(c) of the CWA also minor amendments which are discussed VI. Amendment To Delete Methyl below were warranted. requires EPA to promulgate pretreatment standards for new sources Cellosolve From Pretreatment IV. Amendment to New Source simultaneously with the promulgation Standards Effective Dates of NSPS for a category of sources. When EPA is amending 40 CFR part 439 by Section 306 of the Clean Water Act EPA promulgated the PSNS for the deleting the pretreatment standards for requires EPA to establish, and from time Pharmaceutical Manufacturing Point methyl Cellosolve from §§ 439.16, to time, revise standards of performance Source Category in 1998, PSNS in 439.17, 439.36 and 439.37, and from for categories of new sources which may §§ 439.17, 439.27, 439.37, and 439.47 Table 2 of Appendix A. In the 1998 discharge pollutants. Under the Act, failed to specify when a source regulation, EPA established point sources constructed to meet these constructed before the date on which pretreatment standards for methyl

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Cellosolve and other pollutants which through analysis determined would pass amendment, paragraph, or section of EPA’s pass-through analysis concluded through a POTW’s treatment. When EPA today’s rulemaking for which we do not would pass through POTW treatment used the corrected lower HL value and receive adverse comment will become rather than be removed by POTW found that methyl Cellosolve was not a effective on the date set out above, treatment. EPA based its determination VOC, the Agency’s pass-through notwithstanding any adverse comment on a chemical and engineering analysis determined that this compound on any other distinct amendment, evaluation of which pollutants would would not pass through a POTW’s paragraph, or section of today’s rule. We not be susceptible to treatment in POTW treatment. will address all adverse public biological treatment systems. EPA’s VII. Additional Edits to 40 CFR Part comments in a subsequent final rule pass-through analysis depended on a 439 based on the proposed rule. We will not number of calculations, relying in part institute a second comment period on on a comparison of a parameter’s Today’s rule also includes non- this action. Any parties interested in Henry’s Law Constant (HL) with a substantive edits and format changes to commenting must do so at this time. threshold HL value. the rule promulgated in 1998 in order to In a letter to EPA dated November 28, shorten and clarify 40 CFR part 439. The IX. Statutory and Executive Order 2000, the Pharmaceutical Research and ‘‘Authority’’ citation was shortened to Reviews Manufacturers of America (PhRMA) conform with current guidance from the A. Executive Order 12866: Regulatory indicated that EPA had used an Federal Register Office. The text from Planning and Review incorrect HL value for methyl Cellosolve § 439.4 was merged into § 439.2 and the in the pass-through analysis by heading of § 439.2 was revised to read: Under Executive Order 12866 (58 FR ¥3 51735, (October 4, 1993)), the Agency assuming an HL value of 2.9 × 10 atm/ ‘‘General monitoring requirements.’’ 3 must determine whether a regulatory gmole/m . This was the same HL value Section 439.4 was re-designated under a that had been used for methyl new heading ‘‘General limitation or action is ‘‘significant’’ and therefore Cellosolve by EPA’s Office of Air standard for pH’’ and the term subject to Office of Management and Quality Planning and Standards ‘‘Subcategory’’ was removed from the Budget (OMB) review and the (OAQPS) in establishing the Maximum heading of all subparts. EPA has also requirements of the Executive Order. Air Control Technology (MACT) added definitions of ‘‘Maximum daily’’ The Order defines ‘‘significant standards for pharmaceutical and ‘‘Maximum monthly average’’ to regulatory action’’ as one that is likely manufacturers that were promulgated in § 439.1. These definitions are similar to to result in a rule that may: 1998, and that had been developed those used in other effluent limitations (1) Have an annual effect on the concomitantly with revised guidelines and pretreatment standards economy of $100 million or more or pretreatment standards for 40 CFR part regulations and reflect the definitions adversely affect in a material way the 439. The OAQPS, however, used to promulgate the limits in the economy, a sector of the economy, subsequently revised its HL value for existing 40 CFR part 439. Finally, the productivity, competition, jobs, the methyl Cellosolve from 2.9 × 10¥3 to 3.3 initial phrase, ‘‘The term * * * ’’ was environment, public health or safety, or × 10¥7 atm/gmole/m3, based on a value removed from all definitions, column State, local, or tribal governments or reported by Johanson G. and Dynesius headings and titles of all tables. communities; B. in ‘‘Liquid/air partition coefficients of Corresponding text referencing these (2) Create a serious inconsistency or six commonly used glycol ethers,’’ headings and titles was also revised. otherwise interfere with an action taken or planned by another agency; British Journal of Industrial Medicine, VIII. Rationale for Direct Final Rule 1988, 45:561–564. (3) Materially alter the budgetary The determination of an incorrect HL EPA is publishing this rule without impact of entitlements, grants, user fees, constant was reinforced when EPA also prior proposal because we view this as or loan programs or the rights and considered the analytical technique a noncontroversial amendment and obligations of recipients thereof; or required to measure low concentrations anticipate no adverse comment. The (4) Raise novel legal or policy issues of methyl Cellosolve in wastewater. changes here will facilitate the arising out of legal mandates, the Analytical methods to measure volatile implementation of part 439 and will not President’s priorities, or the principles organic analytes (VOAs) utilize an inert affect environmental impacts or set forth in the Executive Order. gas purging technique to recover VOAs compliance costs. They merely clarify It has been determined that this rule from a wastewater sample. But methyl applicable dates, correct an inadvertent is not a ‘‘significant regulatory action’’ Cellosolve does not purge efficiently error and omission, and make other under the terms of Executive Order and so must be analyzed using a direct non-substantive edits. However, in the 12866 and is therefore not subject to injection technique. This fact offered ‘‘Proposed Rules’’ section of today’s OMB review. additional evidence that EPA had used Federal Register, we are publishing a B. Paperwork Reduction Act an inappropriate HL value for methyl separate document that will serve as the Cellosolve in the earlier pass-through proposal to amend part 439, as This action does not impose an analysis of the pretreatment standards. described herein, if adverse comments information collection burden under the The revised HL for methyl Cellosolve are filed. This rule will be effective on provisions of the Paperwork Reduction (3.3 × 10¥7 atm/gmole/m3) is well below June 11, 2003 without further notice, Act, 44 U.S.C. 3501 et seq. It merely ¥5 the threshold HL value (1 × 10 atm/ unless we receive adverse comment by clarifies applicable dates, corrects an gmole/m3) that EPA used to classify a May 12, 2003. If EPA receives adverse inadvertent error and omission, and compound as a volatile organic comment on one or more distinct makes other non-substantive edits. compound (VOC) for purposes of the amendments, paragraphs, or sections of Burden means the total time, effort, or Agency’s pass-through analysis. Thus, this rulemaking, we will publish a financial resources expended by persons EPA relied on an inappropriate HL value timely withdrawal in the Federal to generate, maintain, retain, or disclose for methyl Cellosolve in the pass- Register indicating which provisions or provide information to or for a through analysis for the 1998 rule. This will become effective and which Federal agency. This includes the time caused this compound to be identified provisions are being withdrawn due to needed to review instructions; develop, as a VOC, which the Agency’s pass- adverse comment. Any distinct acquire, install, and utilize technology

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and systems for the purposes of establish any new requirements with EPA has determined that this final collecting, validating, and verifying respect to those subject to the rule does not contain a Federal mandate information, processing and regulation. The other changes similarly that may result in expenditures of $100 maintaining information, and disclosing would have either no effect on the million or more for State, local and and providing information; adjust the regulated entities, or at most an tribal governments, in the aggregate, or existing ways to comply with any inconsequential effect. The deletion of the private sector in any one year. It previously applicable instructions and methyl Cellosolve would reduce the merely clarifies applicable dates, requirements; train personnel to be able economic impacts of the regulation on corrects an inadvertent error and to respond to a collection of those entities, including small entities, omission, and makes other non- information; search data sources; subject to pretreatment standards in the substantive edits. Thus, today’s rule is complete and review the collection of two subparts which currently contain not subject to the requirements of information; and transmit or otherwise methyl Cellosolve as a regulated sections 202 and 205 of UMRA. disclose the information. parameter. In addition, as noted above, An Agency may not conduct or the revision to re-establish the For the same reason, EPA has determined that this final rule contains sponsor, and a person is not required to minimum concentration for BOD5 respond to a collection of information would correct an earlier inadvertent no regulatory requirements that might unless it displays a currently valid OMB omission and reflect the requirements of significantly affect small governments. control number. The OMB control existing discharge permits. The final rule does not uniquely affect numbers for EPA’s regulations are listed small governments because small and in 40 CFR part 9 and 48 CFR chapter 15. D. Unfunded Mandates Reform Act large governments are affected in the Title II of the Unfunded Mandates same way. Thus, today’s rule is not C. Regulatory Flexibility Act Reform Act of 1995 (UMRA), Public subject to the requirements of section The Regulatory Flexibility Act (RFA), Law 104–4, establishes requirements for 203 of UMRA. as amended by the Small Business Federal agencies to assess the effects of E. Executive Order 13132: Federalism Regulatory Enforcement Fairness Act of their regulatory actions on State, local, 1996 (SBREFA), 5 U.S.C. 601 et seq., and tribal governments and the private Executive Order 13132, entitled generally requires an agency to prepare sector. Under section 202 of the UMRA, ‘‘Federalism’’ (64 FR 43255, August 10, a regulatory flexibility analysis of any EPA generally must prepare a written 1999), requires EPA to develop an rule subject to notice and comment statement, including a cost-benefit accountable process to ensure rulemaking requirements under the analysis, for proposed and final rules ‘‘meaningful and timely input by State Administrative Procedure Act or any with ‘‘Federal mandates’’ that may and local officials in the development of other statute unless the agency certifies result in expenditures to State, local, regulatory policies that have federalism that the rule will not have a significant and tribal governments, in the aggregate, implications.’’ ‘‘Policies that have economic impact on a substantial or to the private sector, of $100 million federalism implications’’ is defined in number of small entities. Small entities or more in any one year. Before the Executive Order to include include small businesses, small promulgating an EPA rule for which a regulations that have ‘‘substantial direct organizations and small governmental written statement is needed, section 205 effects on the States, on the relationship jurisdictions. of the UMRA generally requires EPA to For purposes of assessing the impact between the national government and identify and consider a reasonable the States, or on the distribution of of today’s final rule on small entities, a number of regulatory alternatives and small entity is defined as (1) a small power and responsibilities among the adopt the least costly, most cost- various levels of government.’’ business with gross revenue under $6 effective, or least burdensome million (based on Small Business alternative that achieves the objectives This final rule does not have Administration size standards); (2) a of the rule. The provisions of section federalism implications. It will not have small governmental jurisdiction that is a 205 do not apply when they are substantial direct effects on the States, government of a city, county, town, inconsistent with applicable law. on the relationship between the national school district or special district with a Moreover, section 205 allows EPA to government and the States, or on the population less than 50,000; and (3) a adopt an alternative other than the least distribution of power and small organization that is any not-for- costly, most cost-effective, or least responsibilities among the various profit enterprise which is independently burdensome alternative if the levels of government, as specified in owned and operated and is not Administrator publishes with the final Executive Order 13132. Today’s rule dominant in its field. rule an explanation why that alternative amends effluent limitations and After considering the economic was not adopted. Before EPA establishes pretreatment standards which impose impacts of today’s final rule on small any regulatory requirements that may requirements that apply to facilities entities, I certify that this action will not significantly or uniquely affect small when they discharge wastewater or have a significant economic impact on governments, including tribal introduce wastewater to a POTW. It a substantial number of small entities. It governments, it must have developed, merely clarifies applicable dates, merely clarifies applicable dates, under section 203 of the UMRA, a small corrects an inadvertent error, and corrects an inadvertent error and government agency plan. The plan must omission, and makes other non- omission, and makes other non- provide for notifying potentially substantive edits. EPA has determined substantive edits. As explained above, affected small governments, enabling that there are no pharmaceutical the change to the PSNS sections of the officials of affected small governments facilities owned and/or operated by regulation merely removes any to have meaningful and timely input in State or local governments that would ambiguity about the applicability of the the development of EPA regulatory be subject to today’s rule. Further, the earlier 1983 pretreatment standards proposals with significant Federal rule would only incidentally affect State during the 10-year protection period intergovernmental mandates, and and local governments in their capacity prior to November 20, 1998, and makes informing, educating, and advising as implementers of CWA NPDES them consistent with the latest NSPS small governments on compliance with permitting programs. Thus, Executive sections. The PSNS revision does not the regulatory requirements. Order 13132 does not apply to this rule.

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F. Executive Order 13175: Consultation EPA has reason to believe may have a Dated: February 28, 2003. and Coordination With Indian Tribal disproportionate effect on children. Christine Todd Whitman, Governments H. Executive Order 13211: Actions that Administrator. Executive Order 13175, entitled Significantly Affect Energy Supply, For reasons set out in the preamble, ‘‘Consultation and Coordination with Distribution, or Use part 439, title 40, chapter I of the Code Indian Tribal Governments’’ (65 FR of Federal Regulations is amended as This rule is not subject to Executive follows: 67249, November 9, 2000), requires EPA Order 13211, ‘‘Actions Concerning to develop an accountable process to Regulations That Significantly Affect PART 439—PHARMACEUTICAL ensure ‘‘meaningful and timely input by Energy Supply, Distribution, or Use’’ (66 tribal officials in the development of MANUFACTURING POINT SOURCE FR 28355; May 22, 2001) because it is CATEGORY regulatory policies that have tribal not a significant regulatory action under implications.’’ ‘‘Policies that have tribal Executive Order 12866. 1. The authority citation for part 439 implications’’ is defined in the is revised to read as follows: Executive Order to include regulations I. National Technology Transfer and that have substantial direct effects on Advancement Act Authority: 33 U.S.C. 1311, 1314, 1316, 1317, 1318, 1342 and 1361. one or more Indian tribes, on the Section 12(d) of the National relationship between Federal Technology Transfer and Advancement 2. Section 439.1 is amended by government and Indian tribes or on the Act of 1995 (NTTAA), Public Law 104– revising paragraphs (b) through (n) and distribution of power and 113, section 12(d) (15 U.S.C. 272 note), adding paragraphs (o) and (p) to read as responsibilities between the Federal directs EPA to use voluntary consensus follows: government and Indian tribes. standards in its regulatory activities § 439.1 General definitions. This final rule does not have tribal unless to do so would be inconsistent implications. It will not have substantial with applicable law or otherwise * * * * * direct effects on tribal governments, on impractical. Voluntary consensus (b) Bench-scale operation means the the relationship between this Federal standards are technical standards (e.g., laboratory testing of materials, methods, government and Indian tribes or on the materials specifications, test methods, or processes on a small scale, such as on distribution of power and sampling procedures, business a laboratory worktable. responsibilities between the Federal practices) that are developed or adopted (c) Cyanide (T) means the parameter government and Indian tribes. It merely by voluntary consensus standards total cyanide. clarifies applicable dates, corrects an bodies. The NTTAA directs EPA to (d) In-plant monitoring point means a inadvertent error and omission, and provide Congress, through the Office of location within a plant, where an makes other non-substantive edits. EPA Management and Budget (OMB), individual process effluent can be has not identified any pharmaceutical explanations when the Agency decides exclusively monitored before it is facilities covered by today’s rule that are not to use available and applicable diluted or mixed with other process owned and/or operated by Indian tribal voluntary consensus standards. wastewaters en route to the end-of-pipe. governments. No Indian tribes are This action does not involve technical (e) Maximum daily means the highest responsible for implementing the CWA standards. Therefore, EPA did not allowable discharge of wastewater NPDES permitting program. Thus, consider the use of any voluntary pollutants during a calender day or any Executive Order 13175 does not apply consensus standards. 24 hour period that reasonably to this rule. represents a calender day for purposes J. Congressional Review Act of sampling. G. Executive Order 13045: Protection of The Congressional Review Act, 5 (f) Maximum monthly average means Children From Environmental Health U.S.C. 801 et seq., as added by the Small the highest allowable average of daily Risks and Safety Risks Business Regulatory Enforcement discharges of wastewater pollutants over Executive Order 13045 ‘‘Protection of Fairness Act of 1996, generally provides a calendar month, and is calculated as Children from Environmental Health that before a rule may take effect, the the sum of all daily values measured Risks and Safety Risks’’ (62 FR 19885, agency promulgating the rule must during a calendar month divided by the April 23, 1997) applies to any rule that: submit a rule report, which includes a number of daily values measured during (1) Is determined to be ‘‘economically copy of the rule, to each House of the that month. significant’’ as defined under Executive Congress and to the Comptroller General (g) mg/L means milligrams per liter or Order 12866, and (2) concerns an of the United States. EPA will submit a parts per million (ppm) environmental health or safety risk that report containing this rule and other (h) Minimum level means the level at EPA has reason to believe may have a required information to the U.S. Senate, which an analytical system gives disproportionate effect on children. If the U.S. House of Representatives, and recognizable signals and an acceptable the regulatory action meets both criteria, the Comptroller General of the United calibration point. the Agency must evaluate the States prior to the publication of the (i) Nitrification capability means the environmental health or safety effects of rule in Federal Register. A major rule capability of a POTW treatment system the planned rule on children and cannot take effect until 60 days after it to oxidize ammonia or ammonium salts explain why the planned regulation is is published in the Federal Register. initially to nitrites (via Nitrosomonas preferable to other potentially effective This action is not a ‘‘major rule’’ as bacteria) and subsequently to nitrates and reasonably feasible alternatives defined by 5 U.S.C. 804(2). This rule (via Nitrobacter bacteria). Criteria for considered by the Agency. will be effective June 11, 2003. determining the nitrification capability This final rule is not subject to of a POTW treatment system are: Executive Order 13045 because it is not List of Subjects in 40 CFR Part 439 bioassays confirming the presence of an economically significant rule as Environmental protection, Drugs, nitrifying bacteria; and analyses of the defined under Executive Order 12866. Reporting and recordingkeeping nitrogen balance demonstrating a Further, this rule does not concern an requirements, Waste treatment and reduction in the concentration of environmental health or safety risk that disposal, Water pollution control. ammonia or ammonium salts and an

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increase in the concentrations of nitrites generated or used at a pharmaceutical § 439.12 Effluent limitations attainable by and nitrates. manufacturing facility, except where the the application of the best practicable (j) Non-detect (ND) means a regulated pollutant is monitored as a control technology currently available concentration value below the surrogate parameter. Permit limits and (BPT). minimum level that can be reliably compliance monitoring are not required * * * * * measured by the analytical method. for regulated pollutants that are neither (a) The maximum monthly average (k) Pilot-scale operation means used nor generated at the facility. limitation for BOD5, expressed as mass processing equipment being operated at Except for cyanide, for which an loading (lbs., kg) per day, must reflect an intermediate stage between alternate monitoring requirement is not less than 90 percent reduction in the laboratory-scale and full-scale operation established in subparts A and C of this long-term average daily BOD5 load of for the purpose of developing a new part, a determination that regulated the raw (untreated) process wastewater, product or manufacturing process. pollutants are neither used nor multiplied by a variability factor of 3.0. (l) POTW means publicly owned generated should be based on a review * * * * * treatment works (40 CFR 403.3). of all raw materials in use, and an (m) Process wastewater, as defined at assessment of the process chemistry, (b) The maximum monthly average 40 CFR 122.2 and for the purposes of products and by-products resulting from limitation for TSS, expressed as mass this part, does not include the each of the manufacturing processes. loading (lbs., kg) per day, must be following: This determination along with a calculated as 1.7 times the BOD5 (1) Trimethyl silanol, any active anti- recommendation of any surrogate must limitation determined in paragraph (a) microbial materials, process wastewater be submitted with permit applications of this section. from imperfect fermentation batches, for approval by the permitting authority, (c) Except as provided in paragraph and process area spills. Discharges reconfirmed by an annual chemical (d) of this section, the limitations for containing such materials are not analysis of wastewater from each COD are as follows: subject to the limitations and standards monitoring location, and measurement of this part. of a non-detect value for each regulated EFFLUENT LIMITATIONS (BPT) (2) Non-contact cooling water, utility pollutant or its surrogate. Permits must wastewaters, general site surface runoff, specify that such determinations will be Maximum groundwater (e.g., contaminated Regulated parameter Maximum monthly maintained in the facility’s permit daily 1 groundwaters from on-site or off-site average 1 records with their discharge monitoring groundwater remediation projects), and reports and will be available to other non-process water generated on COD ...... 1675 856 regulatory authorities upon request. site. Discharges of such waters and 1 (b) Unless noted otherwise, self- mg/L (ppm). wastewaters are not subject to the monitoring will be conducted at the limitations and standards of this part. (d) If the maximum monthly average (n) Non-conventional pollutants point where the final effluent is COD concentration in paragraph (c) of means parameters that are neither discharged. this section is higher than a conventional pollutants (40 CFR 4. Section 439.4 is revised to read as concentration value reflecting a 401.16), nor ‘‘toxic’’ pollutants (40 CFR follows: reduction in the long-term average daily 401.15). COD load in the raw (untreated) process § 439.4 General limitation or standard for (o) Surrogate pollutant means a pH. wastewater of 74 percent multiplied by regulated parameter that, for the a variability factor of 2.2, then the purpose of compliance monitoring, is The pH must remain within the range monthly average limitation for COD allowed to serve as a surrogate for a 6.0 to 9.0 in any discharge subject to corresponding to the lower group of specific regulated parameters. BPT, BCT or NSPS limitations or concentration value must be applied. standards in this part. Plants would be allowed to monitor for (e) The effluent limitations for a surrogate pollutant(s), when the other 5. Revise the heading of subpart A to cyanide are as follows: parameters for which it stands are read as follows: receiving the same degree of treatment EFFLUENT LIMITATIONS (BPT) as the surrogate pollutant(s) and all of Subpart A—Fermentation Products the parameters discharged are in the 6. Section 439.11 is revised to read as Maximum same treatability class(es) as their Regulated parameter Maximum monthly follows: daily 1 respective surrogate pollutant(s). average 1 Treatability classes have been identified § 439.11 Special definitions. Cyanide (T) ...... 33.5 9.4 in Appendix A of this part for both For the purpose of this subpart: steam stripping and biological treatment 1 (a) Fermentation means process mg/L (ppm). technologies, which are the respective operations that utilize a chemical * * * * * technology bases for PSES/PSNS and change induced by a living organism or BAT/NSPS limitations controlling the 8. Section 439.14 is revised to read as enzyme, specifically, bacteria, or the discharge of regulated organic follows: microorganisms occurring in unicellular parameters. plants such as yeast, molds, or fungi to § 439.14 Effluent limitations attainable by (p) Xylenes means a combination of produce a specified product. the application of best available technology the three isomers: o-xylene, m-xylene, economically achievable (BAT). and p-xylene. (b) Product means pharmaceutical products derived from fermentation 3. Section 439.2 is revised to read as (a) Except as provided in 40 CFR processes. follows: 125.30 through 125.32, any existing 7. Section 439.12 is amended by point source subject to this subpart must § 439.2 General monitoring requirements. revising paragraphs (a) introductory achieve the following effluent (a) Permit compliance monitoring is text, and (b) through (e) to read as limitations representing the application required for each regulated pollutant follows: of BAT:

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EFFLUENT LIMITATIONS (BAT) PERFORMANCE STANDARDS (NSPS)— PRETREATMENT STANDARDS (PSES)— Continued Continued Maximum Regulated Maximum 1 monthly Maximum Maximum parameter daily 1 Regulated Maximum average Regulated Maximum monthly monthly parameter daily 1 parameter daily 1 average 1 average 1 Ammonia (as N) ... 84.1 29.4 Acetone ...... 0.5 0.2 Isopropanol ...... 3.9 1.6 Isopropyl ether ...... 20.7 8.2 4-methyl-2- Methanol ...... 10.0 4.1 Tetrahydrofuran ...... 9.2 3.4 pentanone ...... 0.5 0.2 Methyl Cellosolve 100.0 40.6 Benzene ...... 3.0 0.7 Isobutyraldehyde .. 1.2 0.5 Dimethyl sulfoxide 91.5 37.5 Toluene ...... 0.3 0.2 n-Amyl acetate ...... 1.3 0.5 Triethyl amine ...... 250.0 102.0 Xylenes ...... 3.0 0.7 n-Butyl acetate ...... 1.3 0.5 Phenol ...... 0.05 0.02 n-Heptane ...... 3.0 0.7 Ethyl acetate ...... 1.3 0.5 Benzene ...... 0.05 0.02 n-Hexane ...... 3.0 0.7 Isopropyl acetate .. 1.3 0.5 Toluene ...... 0.06 0.02 Methylene chloride 3.0 0.7 Methyl formate ...... 1.3 0.5 Xylenes ...... 0.03 0.01 Chloroform ...... 0.1 0.03 Amyl alcohol ...... 10.0 4.1 n-Hexane ...... 0.03 0.02 1,2-dichloroethane .. 20.7 8.2 Ethanol ...... 10.0 4.1 n-Heptane ...... 0.05 0.02 Chlorobenzene ...... 3.0 0.7 Isopropanol ...... 3.9 1.6 Methylene chloride 0.9 0.3 o-Dichlorobenzene .. 20.7 8.2 Methanol ...... 10.0 4.1 Chloroform ...... 0.02 0.13 Diethyl amine ...... 255.0 100.0 Methyl Cellosolve 100.0 40.6 1,2-dichloroethane 0.4 0.1 Triethyl amine ...... 255.0 100.0 Dimethyl sulfoxide 91.5 37.5 Chlorobenzene ..... 0.15 0.06 1 Triethyl amine ...... 250.0 102.0 o-Dichlorobenzene 0.15 0.06 mg/L (ppm) Phenol ...... 0.05 0.02 2 Not applicable to sources that discharge to Tetrahydrofuran .... 8.4 2.6 a POTW with nitrification capability. Benzene ...... 0.05 0.02 Isopropyl ether ...... 8.4 2.6 Toluene ...... 0.06 0.02 Diethyl amine ...... 250.0 102.0 (b) Sources that discharge to a POTW Xylenes ...... 0.03 0.01 Acetonitrile ...... 25.0 10.2 with nitrification capability (defined at n-Hexane ...... 0.03 0.02 § 439.1(i)) are not required to achieve n-Heptane ...... 0.05 0.02 1 mg/L (ppm) the pretreatment standard for ammonia Methylene chloride 0.9 0.3 (b) The limitations for cyanide are the Chloroform ...... 0.02 0.13 (as N). 1,2-dichloroethane 0.4 0.1 same as specified in § 439.12(e), (f) and (c) The limitations for cyanide are the Chlorobenzene ..... 0.15 0.06 (g). same as specified in § 439.12(e), (f) and o-Dichlorobenzene 0.15 0.06 (c) Any new source subject to the (g). Tetrahydrofuran .... 8.4 2.6 provisions of this section that 11. Section 439.17 is revised to read Isopropyl ether ...... 8.4 2.6 commenced discharging after November as follows: Diethyl amine ...... 250.0 102.0 21, 1988, and prior to November 20, Acetonitrile ...... 25.0 10.2 1998, must continue to achieve the § 439.17 Pretreatment standards for new sources (PSNS). 1 mg/L (ppm). standards specified for this section in the 1988 edition of 40 CFR part 439, (a) Except as provided in 40 CFR (b) The limitations for COD are the until the expiration of the applicable 403.7, any new source subject to this same as specified in § 439.12(c) and (d). time period specified in 40 CFR subpart that commenced discharge on (c) The limitations for cyanide are the 122.29(d)(1), after which the source November 20, 1998, or thereafter must same as specified in § 439.12(e), (f) and must achieve the standards specified in achieve the same standards as specified (g). §§ 439.13 and 439.14. in § 439.16. 9. Section 439.15 is revised to read as 10. Section 439.16 is revised to read (b) Except as provided in 40 CFR follows: as follows: 403.7, any new source subject to this § 439.15 New source performance subpart that commenced discharging § 439.16 Preatment standards for existing standards (NSPS). after November 21, 1988, and prior to sources (PSES). (a) Any new source subject to this November 20, 1998, must continue to (a) Except as provided in 40 CFR subpart must achieve the following achieve the pretreatment standards 403.7 and 403.13, any existing source standards: specified for this section in the 1988 subject to this subpart must continue edition of 40 CFR part 439 during a ten- achieving the standards for cyanide PERFORMANCE STANDARDS (NSPS) year period beginning on the date the specified in paragraph (c) of this section source commenced discharge, or during Maximum and must achieve the following the period of depreciation or Regulated Maximum monthly standards by September 21, 2001: amortization of the facility, whichever parameter daily 1 average 1 comes first, after which the source must PRETREATMENT STANDARDS (PSES) achieve the same standards as specified BOD5 ...... 267 111 in § 439.16. TSS ...... 472 166 Regulated Maximum Maximum COD ...... 1675 856 monthly 12. Revise the heading of subpart B to parameter daily 1 Ammonia (as N) ... 84.1 29.4 average 1 read as follows: Acetone ...... 0.5 0.2 4-methyl-2- Ammonia (as N) 2 ... 84.1 29.4 Subpart B—Extraction Products pentanone ...... 0.5 0.2 Acetone ...... 20.7 8.2 Isobutyraldehyde .. 1.2 0.5 4-methyl-2- 13. Section 439.21 is revised to read n-Amyl acetate ...... 1.3 0.5 pentanone ...... 20.7 8.2 as follows: n-Butyl acetate ...... 1.3 0.5 Isobutyraldehyde .... 20.7 8.2 § 439.21 Special definitions. Ethyl acetate ...... 1.3 0.5 n-Amyl acetate ...... 20.7 8.2 Isopropyl acetate .. 1.3 0.5 n-Butyl acetate ...... 20.7 8.2 For the purpose of this subpart: Methyl formate ...... 1.3 0.5 Ethyl acetate ...... 20.7 8.2 (a) Extraction means process Amyl alcohol ...... 10.0 4.1 Isopropyl acetate .... 20.7 8.2 operations that derive pharmaceutically Ethanol ...... 10.0 4.1 Methyl formate ...... 20.7 8.2 active ingredients from natural sources

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such as plant roots and leaves, animal PERFORMANCE STANDARDS (NSPS)— achieve the same standards as specified glands, and parasitic fungi by chemical Continued in § 439.26. and physical extraction. 18. Revise the heading of Subpart C to (b) Product means any substance Maximum read as follows: Regulated parameter Maximum monthly manufactured by an extraction process, daily 1 average 1 including blood fractions, vaccines, Subpart C—Chemical Synthesis Products serums, animal bile derivatives, COD ...... 228 86 endocrine products and medicinal 19. Section 439.31 is revised, 1 mg/L (ppm) products such as alkaloids that are including the section heading, to read as isolated from botanical drugs and herbs. (b) Any new source subject to the follows: 14. Section 439.22 is amended by provisions of this section that § 439.31 Special definitions. revising paragraphs (a) introductory text commenced discharging after November and (b) through (d) to read as follows: 21, 1988, and prior to November 20, For the purpose of this subpart: 1998, must continue to achieve the (a) Chemical synthesis means using § 439.22 Effluent limitations attainable by standards specified for this section in one or a series of chemical reactions in the application of the best practicable the 1988 edition of 40 CFR part 439, the manufacturing process of a specified control technology currently available product. until the expiration of the applicable (BPT). (b) Product means any pharmaceutical time period specified in 40 CFR * * * * * product manufactured by chemical 122.29(d)(1), after which the source synthesis. (a) The limitation for BOD5 is the must achieve the standards specified in same as specified in § 439.12(a). No §§ 439.23 and 439.24. 20. Section 439.32 is amended by facility shall be required to attain a revising paragraphs (a) through (d) and 16. Section 439.26 is revised to read removing paragraphs (e) through (g) to monthly average limitation for BOD5 as follows: that is less than the equivalent of 45 mg/ read as follows: L. § 439.26 Pretreatment standards for § 439.32 Effluent limitations attainable by * * * * * existing sources (PSES). the application of the best practicable (b) The limitation for TSS is the same Except as provided in 40 CFR 403.7 control technology currently available as specified in § 439.12(b). and 403.13, any existing source subject (BPT). (c) Except for the provisions in to this subpart must achieve the * * * * * paragraph (d) of this section, the following standards by September 21, (a)The limitation for BOD5 is the same limitations for COD are as follows: 2001: as specified in § 439.12(a). (b) The limitation for TSS is the same EFFLUENT LIMITATIONS (BPT) PRETREATMENT STANDARDS (PSES) as specified in § 439.12(b). (c) The limitations for COD are the Maximum same as specified in § 439.12(c) and (d). Maximum Maximum Maximum Regulated parameter monthly Regulated parameter 1 monthly (d) The limitations for cyanide are the daily 1 daily 1 average 1 average same as specified in § 439.12(e), (f) and (g). COD ...... 228 86 Acetone ...... 20.7 8.2 n-Amyl acetate ...... 20.7 8.2 * * * * * 1 mg/L (ppm) Ethyl acetate ...... 20.7 8.2 21. Section 439.34 is revised to read Isopropyl acetate ...... 20.7 8.2 as follows: (d) If the maximum monthly average Methylene chloride ... 3.0 0.7 COD concentration in paragraph (c) of § 439.34 Effluent limitations attainable by this section is higher than a 1 mg/L (ppm). the application of best available technology economically achievable (BAT). concentration value reflecting a 17. Section 439.27 is revised to read reduction in the long-term average daily as follows: Except as provided in 40 CFR 125.30 COD load in the raw (untreated) process through 125.32, any existing point wastewater of 74 percent multiplied by § 439.27 Pretreatment standards for new source subject to this subpart must a variability factor of 2.2, then a sources (PSNS). achieve the following effluent monthly average limitation for COD (a) Except as provided in 40 CFR limitations representing the application corresponding to the lower 403.7, any new source subject to this of BAT: concentration value must be applied. subpart that commenced discharge on (a) The limitations are the same as 15. Section 439.25 is revised to read November 20, 1998, or thereafter must specified in § 439.14(a). (b) The limitations for COD are the as follows: achieve the same standards as specified in § 439.26. same as specified in § 439.12(c) and (d). (c) The limitations for cyanide are the § 439.25 New source performance (b) Except as provided in 40 CFR standards (NSPS). same as specified in § 439.12(e), (f) and 403.7, any new source subject to this (g). (a) Any new source subject to this subpart that commenced discharging subpart must achieve the following after November 21, 1988, and prior to 22. Section 439.35 is revised to read standards: November 20, 1998, must continue to as follows: achieve the pretreatment standards § 439.35 New source performance PERFORMANCE STANDARDS (NSPS) specified for this section in the 1988 standards (NSPS). edition of 40 CFR part 439 during a ten- (a) Any new source subject to this Maximum year period beginning on the date the Regulated parameter Maximum monthly subpart must achieve the same daily 1 average 1 source commenced discharge, or during standards as specified in § 439.15(a). the period of depreciation or (b) The limitations for cyanide are the BOD5 ...... 35 18 amortization of the facility, whichever same as specified in § 439.12(e), (f) and TSS ...... 58 31 comes first, after which the source must (g).

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(c) Any new source subject to the that put pharmaceutical products in § 439.46 Pretreatment standards for provisions of this section that dosage forms. existing sources (PSES). commenced discharging after November (b) Product means any pharmaceutical Except as provided in 40 CFR 403.7 21, 1988, and prior to November 20, product manufactured by blending, and 403.13, any existing source subject 1998, must continue to achieve the mixing, compounding, and formulating to this subpart must achieve the standards specified for this section in pharmaceutical ingredients. The term following standards by September 21, the 1988 edition of 40 CFR part 439, includes pharmaceutical preparations 2001: until the expiration of the applicable for both human and veterinary use such time period specified in 40 CFR as ampules, tablets, capsules, vials, PRETREATMENT STANDARDS (PSES) 122.29(d)(1), after which the source ointments, medicinal powders, must achieve the standards specified in Maximum solutions, and suspensions. Regulated parameter Maximum monthly daily1 § 439.33 and § 439.34. average1 23. Section 439.36 is revised to read 27. Section 439.42 is amended by as follows: revising paragraphs (a) through (c) and removing paragraph (d) to read as Acetone ...... 20.7 8.2 n-Amyl acetate ...... 20.7 8.2 § 439.36 Pretreatment standards for follows: Ethyl acetate ...... 20.7 8.2 existing sources (PSES). Isopropyl acetate ...... 20.7 8.2 Except as provided in 40 CFR 403.7 § 439.42 Effluent limitations attainable by the application of the best practicable Methylene chloride ... 3.0 0.7 and 403.13, any existing source subject control technology currently available 1 mg/L (ppm). to this subpart must continue achieving (BPT). the standards for cyanide specified in * * * * * 31. Section 439.47 is revised to read paragraph (b) of this section and must as follows: achieve the standards specified in (a) The limitation for BOD5 is the § 439.16(a) by September 21, 2001. same as specified in § 439.12(a). No § 439.47 Pretreatment standards for new (a) Sources that discharge to a POTW facility shall be required to attain a sources (PSNS). with nitrification capability (defined at monthly average limitation for BOD5 (a) Except as provided in 40 CFR § 439.1(i)) are not required to achieve that is less than the equivalent of 45 mg/ 403.7, any new source subject to this the standards for ammonia (as N). L. subpart that commenced discharge on (b) The standards for cyanide are the (b) The limitation for TSS is the same November 20, 1998, or thereafter must same as specified in § 439.12(e), (f) and as specified in § 439.12(b). achieve the same standards as specified (g). (c) The limitations for COD are the in § 439.46. 24. Section 439.37 is revised to read same as specified in § 439.22(c) and (d). (b) Except as provided in 40 CFR as follows: * * * * * 403.7, any new source subject to this subpart that commenced discharging § 439.37 Pretreatment standards for new 28. Section 439.44 is revised to read after November 21, 1988, and prior to sources (PSNS). as follows: November 20, 1998, must continue to (a) Except as provided in 40 CFR § 439.44 Effluent limitations attainable by achieve the pretreatment standards 403.7, any new source subject to this the application of best available technology specified for this section in the 1988 subpart that commenced discharge on economically achievable (BAT). edition of 40 CFR part 439 during a ten- November 20, 1998, or thereafter must Except as provided in 40 CFR 125.30 year period beginning on the date the achieve the same standards as specified source commenced discharge, or during in § 439.36. through 125.32, any existing point source subject to this subpart must the period of depreciation or (b) Except as provided in 40 CFR amortization of the facility, whichever 403.7, any new source subject to this achieve the following effluent limitations representing the application comes first, after which the source must subpart that commenced discharging achieve the same standards as specified after November 21, 1988, and prior to of BAT: The limitations for COD are the same as specified in § 439.22(c) and (d). in § 439.46. November 20, 1998, must continue to 32. Revise the heading of subpart E to achieve the pretreatment standards 29. Section 439.45 is revised to read read as follows: specified for this section in the 1988 as follows: edition of 40 CFR part 439 during a ten- Subpart E—Research year period beginning on the date the § 439.45 New source performance standards (NSPS). source commenced discharge, or during 33. Section 439.51 is revised to read the period of depreciation or (a) Any new source subject to this as follows: amortization of the facility, whichever subpart must achieve the same § 439.51 Special definitions. comes first, after which the source must standards as specified in § 439.25(a). achieve the same standards as specified (b) Any new source subject to the For the purpose of this subpart, in § 439.36. provisions of this section that product means products or services resulting from research and product 25. Revise the heading of Subpart D commenced discharging after November development activities. to read as follows: 21, 1988, and prior to November 20, 1998, must continue to achieve the 34. Section 439.52 is amended by Subpart D—Mixing/Compounding and standards specified for this section in revising paragraphs (a) through (d) to Formulation the 1988 edition of 40 CFR part 439, read as follows: until the expiration of the applicable § 439.52 Effluent limitations attainable by 26. Section 439.41 is revised to read time period specified in 40 CFR as follows: the application of the best practicable 122.29(d)(1), after which the source control technology currently available § 439.41 Special definitions. must achieve the standards specified in (BPT). For the purpose of this subpart: § 439.43 and § 439.44. * * * * * (a) Mixing, compounding, and 30. Section 439.46 is revised to read (a) The limitation for BOD5 is the formulating operations means processes as follows: same as specified in § 439.12(a). No

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facility shall be required to attain a after the practices of recovery and/or TABLE 2.—SURROGATE PARAMETERS monthly average limitation for BOD5 separate disposal or reuse. Residual FOR INDIRECT DISCHARGERS (UTI- that is less than the equivalent of 45 mg/ amounts of these substances may be LIZING STEAM STRIPPING TREAT- L. included in the calculation of the MENT TECHNOLOGY) (b) The limitation for TSS is the same average influent BOD5 or COD loading. as specified in § 439.12(b). (2) The practices of recovery, and/or Regulated parameters Treatability class (c) The maximum monthly average separate disposal or reuse include: limitation for COD, expressed as mass Benzene recovery of solvents from wastestreams; Toluene 1 loading (lbs, kg) per day, must reflect and incineration of concentrated solvent not less than 74 percent reduction in the Xylenes wastestreams (including tar still long-term average daily COD load of the n-Heptane High strippability. bottoms). This regulation does not Chloroform 1 raw (untreated) process wastewater, prohibit the inclusion of such wastes in Methylene chloride 1 multiplied by a variability factor of 2.2. Chlorobenzene No facility shall be required to attain a raw waste loads in fact, nor does it limitation for COD that is less than the mandate any specific practice, but Ammonia (aqueous) equivalent of 220 mg/L. rather describes the rationale for Diethyl amine determining NPDES permit limitations. Triethyl amine (d) The long-term average daily BOD5 1 or COD mass loading of the raw process The effluent limitation for BOD5 or COD Acetone 4-methyl-2-pentanone wastewater (i.e., the base number to may be achieved by any of several, or a combination, of these practices. n-Amyl acetate which the percent reduction is applied) n-Butyl acetate is defined as the average daily BOD5 or * * * * * Ethyl acetate Medium COD load during any calendar month, 35. Table 2 of Appendix A is revised strippability. over 12 consecutive months within the Isopropyl acetate most recent 36 months. to read as follows: Methyl formate (1) To assure equity in the Isopropyl ether Appendix A to Part 439—Tables 1 determination of NPDES permit Tetrahydrofuran limitations regulating discharges subject * * * * * 1,2-dichloroethane o-Dichlorobenzene to this subpart, calculation of the long- 1 term average daily BOD5 or COD load in These parameters may be used as a sur- the influent to the wastewater treatment rogate to represent other parameters in the same treatability class. system must exclude any portion of the load associated with solvents, except for [FR Doc. 03–5716 Filed 3–12–03; 8:45 am] residual amounts of solvents remaining BILLING CODE 6560–50–P

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ENVIRONMENTAL PROTECTION (PSNS) would be subject to effluent ADDRESSES: Comments may be AGENCY limitations and pretreatment standards submitted electronically, by mail, or established in the 1998 regulation. through hand delivery/courier. Please 40 CFR Part 439 Second, this rule re-establishes a mail comments to the Water Docket, minimum concentration for the Environmental Protection Agency, [FRL–7462–7] maximum monthly average BOD5 Mailcode: 4101T, 1200 Pennsylvania Effluent Limitations Guidelines, limitation that EPA inadvertently Avenue, NW., Washington, DC 20460 or Pretreatment Standards, and New omitted from the Best Practicable submit them electronically to http:// Source Performance Standards for the Control Technology (BPT) requirements www.epa.gov/edocket. Send either to Pharmaceutical Manufacturing Point in two subcategories of the 1998 the Attention of Docket ID No. OW– Source Category; Proposed Rule regulation. Next, the amendments 2003–0007. See section I.C. of the correct an error in EPA’s pass-through SUPPLEMENTARY INFORMATION section for AGENCY: Environmental Protection analysis prepared in support of the 1998 more information on submitting Agency. rule and, as a result, methyl Cellosolve comments. ACTION: Proposed rule. (2-methoxyethanol) from the FOR FURTHER INFORMATION CONTACT: Dr. pretreatment standards in two Frank Hund, U.S. EPA Office of Water SUMMARY: The Environmental Protection subcategories and from Appendix A, by phone at (202) 566–1027 or by e-mail Agency (EPA) is proposing to amend Table 2, ‘‘Surrogate Parameters for at [email protected]. certain provisions of the effluent Indirect Dischargers.’’ Finally, the SUPPLEMENTARY INFORMATION: guidelines for the Pharmaceutical Agency is making other non-substantive Manufacturing Point Source Category, editorial and format changes such as I. General Information which were published on September 21, removing redundancies, and adding A. Regulated Entities 1998 (63 FR 50424). First, EPA is definitions. clarifying the date on which a Entities potentially regulated by this discharger subject to the New Source DATES: Comments must be received by action include facilities of the following Performance Standards (NSPS) and the May 12, 2003. Comments postmarked types that discharge pollutants directly Pretreatment Standards for New Sources after this date may not be considered. or indirectly to U.S. waters.

Category Examples of regulated entities SIC (NAICS) code

Industry ...... Facilities that generate process wastewater from the manufacture of pharma- 2833, R834, 2836 (2834–04, ceutical products and/or pharmaceutical intermediates by fermentation, extrac- 2834–98). tion, chemical synthesis and/or mixing, compounding and formulating.

This table is not intended to be Docket in the EPA Docket Center, (EPA/ select ‘‘search,’’ then key in the exhaustive, but rather provides a guide DC) EPA West, Room B102, 1301 appropriate docket identification for readers regarding entities likely to be Constitution Ave., NW., Washington, number. regulated by this action. This table lists DC. The EPA Docket Center Public Certain types of information will not the types of entities that EPA is now Reading Room is open from 8:30 a.m. to be placed in the EPA Dockets. aware could potentially be regulated by 4:30 p.m., Monday through Friday, Information claimed as confidential this action. Other types of entities not excluding legal holidays. The telephone business information (CBI) and other listed in the table could also be number for the Public Reading Room is information whose disclosure is regulated. To determine whether your (202) 566–1744, and the telephone restricted by statute, which is not facility is regulated by this action, you number for the Water Docket is (202) included in the official public docket, should carefully examine the definitions 566–2426. For access to docket will not be available for public viewing and applicability criteria in §§ 439.10, materials, please call ahead to schedule in EPA’s electronic public docket. EPA’s 439.20, 439.30, 439.40 and 439.50 of an appointment. Every user is entitled policy is that copyrighted material will title 40 of the Code of Federal to copy 100 pages before incurring a not be placed in EPA’s electronic public Regulations. If you have questions charge. The Docket may charge 15 cents docket but will be available only in a page for each page over the 100-page regarding the applicability of this action printed, paper form in the official public limit. to a particular entity, consult the person docket. To the extent feasible, publicly listed in the preceding FOR FURTHER 2. Electronic Access. You may access available docket materials will be made INFORMATION CONTACT section. this Federal Register document available in EPA’s electronic public electronically through the EPA Internet B. How Can I Get Copies of This docket. When a document is selected under the ‘‘Federal Register’’ listings at Document and Other Related from the index list in EPA Dockets, the http://www.epa.gov/fedrgstr/. Information? system will identify whether the An electronic version of the public document is available for viewing in 1. Docket. EPA has established an docket is available through EPA’s EPA’s electronic public docket. official public docket for this action electronic public docket and comment Although not all docket materials may under Docket ID No. OW–2003–0007. system, ‘‘EPA Dockets.’’ You may use be available electronically, you may still The official public docket consists of the EPA Dockets at http://www.epa.gov/ access any of the publicly available documents specifically referenced in edocket/ to submit or view public docket materials through the docket this action, any public comments comments, access the index listing of facility identified in section I.B.1. EPA received, and other information related the contents of the official public intends to work towards providing to this action. The official public docket docket, and to access those documents electronic access to all of the publicly is the collection of materials that is in the public docket that are available available docket materials through available for public viewing at the Water electronically. Once in the system, EPA’s electronic public docket.

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For public commenters, it is cover letter accompanying the disk or DC 20460, Attention Docket ID No. OW– important to note that EPA’s policy is CD–ROM. This ensures that you can be 2003–0007. that public comments, whether identified as the submitter of the 3. By Hand Delivery or Courier. submitted electronically or in paper, comment and allows EPA to contact you Deliver your comments to: Water will be made available for public in case EPA cannot read your comment Docket, EPA Docket Center, EPA West, viewing in EPA’s electronic public due to technical difficulties or needs Room B102, 1301 Constitution Ave., docket as EPA receives them and further information on the substance of NW., Washington, DC, Attention Docket without change, unless the comment your comment. EPA’s policy is that EPA ID No. OW–2003–0007. Such deliveries contains copyrighted material, CBI, or will not edit your comment, and any are only accepted during the Docket’s other information whose disclosure is identifying or contact information normal hours of operation as identified restricted by statute. When EPA provided in the body of a comment will in section I.B.1. identifies a comment containing be included as part of the comment that D. How Should I Submit CBI to the copyrighted material, EPA will provide is placed in the official public docket, Agency? a reference to that material in the and made available in EPA’s electronic version of the comment that is placed in public docket. If EPA cannot read your Do not submit information that you EPA’s electronic public docket. The comment due to technical difficulties consider to be CBI electronically entire printed comment, including the and cannot contact you for clarification, through EPA’s electronic public docket copyrighted material, will be available EPA may not be able to consider your or by e-mail. Send information in the public docket. comment. identified as CBI by mail only to the following address: Office of Science and Public comments submitted on i. EPA Dockets. Your use of EPA’s Technology, Mail Code 4303T, U.S. computer disks that are mailed or electronic public docket to submit Environmental Protection Agency, 1200 delivered to the docket will be comments to EPA electronically is Pennsylvania Ave., NW., Washington, transferred to EPA’s electronic public EPA’s preferred method for receiving DC 20460, Attention: Frank Hund, docket. Public comments that are comments. Go directly to EPA Dockets mailed or delivered to the Docket will Docket ID No. OW–2003–0007. at http://www.epa.gov/edocket, and You may claim information that you be scanned and placed in EPA’s follow the online instructions for electronic public docket. Where submit to EPA as CBI by marking any submitting comments. To access EPA’s part or all of that information as CBI (if practical, physical objects will be electronic public docket from the EPA photographed, and the photograph will you submit CBI on disk or CD–ROM, Internet Home Page, select ‘‘Information mark the outside of the disk or CD–ROM be placed in EPA’s electronic public Sources,’’ ‘‘Dockets,’’ and ‘‘EPA docket along with a brief description as CBI and then identify electronically Dockets.’’ Once in the system, select within the disk or CD–ROM the specific written by the docket staff. ‘‘search,’’ and then key in Docket ID No. For additional information about information that is CBI). Information so OW–2003–0007. The system is an EPA’s electronic public docket visit EPA marked will not be disclosed except in ‘‘anonymous access’’ system, which Dockets online or see 67 FR 38102, May accordance with procedures set forth in means EPA will not know your identity, 31, 2002. 40 CFR part 2. e-mail address, or other contact In addition to one complete version of C. How and to Whom Do I Submit information unless you provide it in the the comment that includes any Comments? body of your comment. information claimed as CBI, a copy of You may submit comments ii. E-mail. Comments may be sent by the comment that does not contain the electronically, by mail, or through hand electronic mail (e-mail) to OW– information claimed as CBI must be delivery/courier. Please submit with [email protected], Attention Docket ID submitted for inclusion in the public your comments any references cited in No. OW–2003–0007. In contrast to docket and EPA’s electronic public your comments. To ensure proper EPA’s electronic public docket, EPA’s e- docket. If you submit the copy that does receipt by EPA, identify the appropriate mail system is not an ‘‘anonymous not contain CBI on disk or CD–ROM, docket identification number in the access’’ system. If you send an e-mail mark the outside of the disk or CD–ROM subject line on the first page of your comment directly to the Docket without clearly that it does not contain CBI. comment. Please ensure that your going through EPA’s electronic public Information not marked as CBI will be comments are submitted within the docket, EPA’s e-mail system included in the public docket and EPA’s specified comment period. Comments automatically captures your e-mail electronic public docket without prior received after the close of the comment address. E-mail addresses that are notice. If you have any questions about period will be marked ‘‘late.’’ EPA is not automatically captured by EPA’s e-mail CBI or the procedures for claiming CBI, required to consider these late system are included as part of the please consult the person identified in comments; however, late comments may comment that is placed in the official the FOR FURTHER INFORMATION CONTACT be considered if time permits. If you public docket, and made available in section. wish to submit CBI or information that EPA’s electronic public docket. is otherwise protected by statute, please iii. Disk or CD–ROM. You may submit II. Discussion of Direct Final follow the instructions in section I.D. Do comments on a disk or CD–ROM that Rulemaking not use EPA Dockets or e-mail to submit you mail to the mailing address In the ‘‘Rules and Regulations’’ CBI or information protected by statute. identified in section 1.C.2. These section of today’s Federal Register, EPA 1. Electronically. If you submit an electronic submissions will be accepted is promulgating these revisions as a electronic comment as prescribed in Word Perfect or ASCII file format. direct final rule without prior proposal below, EPA recommends that you Avoid the use of special characters and because we view them as include your name, mailing address, any form of encryption. noncontroversial revisions and and an e-mail address or other contact 2. By Mail. Send an original and three anticipate no adverse comment. We information in the body of your (3) copies of your comments to the have explained our reasons for these comment. Also include this contact Water Docket, Environmental Protection revisions in the preamble to the direct information on the outside of any disk Agency, Mail Code 4101T, 1200 final rule. If we receive no adverse or CD–ROM you submit, and in any Pennsylvania Ave., NW., Washington, comment, we will not take further

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action on this proposed rule. If we III. Related Acts of Congress, Executive List of Subjects in 40 CFR Part 439 receive adverse comment, we will Orders, and Agency Initiatives Environmental protection, Drugs, withdraw the direct final rule or Reporting and recordkeeping portions thereof, and the direct final For the various statutes and Executive Orders that require findings for requirements, Waste treatment and rule or portions thereof will not take disposal, Water pollution control. effect. We will address all public rulemaking, EPA incorporates the comments in a subsequent final rule findings from the direct final rule into Dated: February 28, 2003. based on this action. We will not this companion proposal for the Christine Todd Whitman, institute a second comment period on purpose of providing public notice and Administrator. this action. Any parties interested in opportunity for comment. [FR Doc. 03–5715 Filed 3–12–03; 8:45 am] commenting must do so at this time. BILLING CODE 6560–50–P

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Part IV

The President Memorandum of March 11, 2003— Designation of Officers of the Office of Personnel Management to Act as Director of the Office of Personnel Management

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Federal Register Presidential Documents Vol. 68, No. 49

Thursday, March 13, 2003

Title 3— Memorandum of March 11, 2003

The President Designation of Officers of the Office of Personnel Management to Act as Director of the Office of Personnel Management

Memorandum for the Director of the Office of Personnel Management

By the authority vested in me as President under the Constitution and laws of the United States of America and pursuant to the Federal Vacancies Reform Act of 1998, 5 U.S.C. 345 et seq., I hereby order that: Section 1. Order of Succession. During any period when the Director of the Office of Personnel Management (Director), or the Deputy Director of the Office of Personnel Management, has died, resigned, or otherwise become unable to perform the functions and duties of the office of Director, the following officers of the Office of Personnel Management, in the order listed, shall perform the functions and duties of the office of Director, if they are eligible to act as Director under the provisions of the Federal Vacancies Reform Act of 1998, until such time as at least one of the officers mentioned above is able to perform the functions and duties of the office of Director: Chief of Staff; General Counsel; Associate Director, Management and Chief Financial Officer; Associate Director, Human Resources Policy; Associate Director, Human Resources Products and Services; Associate Director, Human Capital Leadership and Merit Systems Account- ability; Deputy Associate Director, Center for Investigations Services; Director, Office of Congressional Relations; Director, Office of Communications; Senior Advisor, Homeland Security; and Senior Advisor, Learning and Knowledge Management. Sec. 2. Exceptions. (a) No individual who is serving in an office listed in section 1 in an acting capacity, by virtue of so serving, shall act as Director pursuant to this memorandum. (b) Notwithstanding the provisions of this memorandum, the President retains discretion, to the extent permitted by the Federal Vacancies Reform Act of 1998, 5 U.S.C. 3345–3349d, to depart from this memorandum in designating an acting Director.

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Sec. 3. Publication. You are authorized and directed to publish this memorandum in the Federal Register. W THE WHITE HOUSE, Washington, March 11, 2003.

[FR Doc. 03–6255 Filed 3–12–03; 8:45 am] Billing code 6325–01–M

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Reader Aids Federal Register Vol. 68, No. 49 Thursday, March 13, 2003

CUSTOMER SERVICE AND INFORMATION CFR PARTS AFFECTED DURING MARCH

Federal Register/Code of Federal Regulations At the end of each month, the Office of the Federal Register General Information, indexes and other finding 202–741–6000 publishes separately a List of CFR Sections Affected (LSA), which aids lists parts and sections affected by documents published since Laws 741–6000 the revision date of each title. 11446 (Amended by: Presidential Documents 3 CFR 13286) ...... 10619 Executive orders and proclamations 741–6000 Administrative Orders: 11448 (Amended by: The United States Government Manual 741–6000 Memorandums: 13286) ...... 10619 Memorandum of Other Services 11623 (Amended by: February 12, 2003 ...... 10141 13286) ...... 10619 Electronic and on-line services (voice) 741–6020 Memorandum of March 11645 (Amended by: Privacy Act Compilation 741–6064 12, 2003 ...... 12281 13286) ...... 10619 Public Laws Update Service (numbers, dates, etc.) 741–6043 Presidential 11800 (Amended by: TTY for the deaf-and-hard-of-hearing 741–6086 Determinations: 13286) ...... 10619 No. 2003–15 of 11858 (Amended by: February 13, 2003 ...... 10651 ELECTRONIC RESEARCH 13286) ...... 10619 Proclamations: 11926 (Amended by: World Wide Web 7648...... 10641 13286) ...... 10619 7649...... 10643 11965 (Amended by: Full text of the daily Federal Register, CFR and other publications 7650...... 10645 13286) ...... 10619 is located at: http://www.access.gpo.gov/nara 7651...... 10647 12002 (Amended by: Federal Register information and research tools, including Public 7652...... 10649 13286) ...... 10619 Inspection List, indexes, and links to GPO Access are located at: Executive Orders: 12146 (Amended by: http://www.archives.gov/federallregister/ 4601 (Amended by: 13286) ...... 10619 E-mail 13286) ...... 10619 12148 (Amended by: 10113 (Amended by: 13286) ...... 10619 FEDREGTOC-L (Federal Register Table of Contents LISTSERV) is 13286) ...... 10619 12160 (Amended by: an open e-mail service that provides subscribers with a digital 10163 (Amended by: 13286) ...... 10619 form of the Federal Register Table of Contents. The digital form 13286) ...... 10619 12188 (Amended by: of the Federal Register Table of Contents includes HTML and 10179 (Amended by: 13286) ...... 10619 PDF links to the full text of each document. 13286) ...... 10619 12208 (Amended by: To join or leave, go to http://listserv.access.gpo.gov and select 10271 (Amended by: 13286) ...... 10619 Online mailing list archives, FEDREGTOC-L, Join or leave the list 13286) ...... 10619 12341 (Amended by: (or change settings); then follow the instructions. 10448 (Amended by: 13286) ...... 10619 13286) ...... 10619 12382 (Amended by: PENS (Public Law Electronic Notification Service) is an e-mail 10499 (Amended by: 13286) ...... 10619 service that notifies subscribers of recently enacted laws. 13286) ...... 10619 12472 (Amended by: To subscribe, go to http://listserv.gsa.gov/archives/publaws-l.html 10554 (Amended by: 13286) ...... 10619 and select Join or leave the list (or change settings); then follow 13286) ...... 10619 12501 (Amended by: the instructions. 10631 (Amended by: 13286) ...... 10619 FEDREGTOC-L and PENS are mailing lists only. We cannot 13286) ...... 10619 12555 (Amended by: respond to specific inquiries. 10637 (Amended by: 13286) ...... 10619 13286) ...... 10619 12580 (Amended by: Reference questions. Send questions and comments about the 10694 (Amended by: 13286) ...... 10619 Federal Register system to: [email protected] 13286) ...... 10619 12656 (Amended by: The Federal Register staff cannot interpret specific documents or 10789 (Amended by: 13286) ...... 10619 regulations. 13286) ...... 10619 12657 (Amended by: 10977 (Amended by: 13286) ...... 10619 FEDERAL REGISTER PAGES AND DATE, MARCH 13286) ...... 10619 12699 (Amended by: 11016 (Amended by: 13286) ...... 10619 9851–10140...... 3 13286) ...... 10619 12727 (Amended by: 10141–10344...... 4 11046 (Amended by: 13286) ...... 10619 10345–10650...... 5 13286) ...... 10619 12728 (Amended by: 11079 (Amended by: 13286) ...... 10619 10651–10952...... 6 13286) ...... 10619 12733 (Amended by: 10953–11310...... 7 11139 (Amended by: 13286) ...... 10619 11311–11462...... 10 13286) ...... 10619 12742 (Amended by: 11463–11732...... 11 11190 (Amended by: 13286) ...... 10619 11733–11966...... 12 13286) ...... 10619 12743 (Amended by: 11967–12282...... 13 11231 (Amended by: 13286) ...... 10619 13286) ...... 10619 12777 (Amended by: 11239 (Amended by: 13286) ...... 10619 13286) ...... 10619 12788 (Amended by: 11366 (Amended by: 13286) ...... 10619 13286) ...... 10619 12789 (Amended by: 11438 (Amended by: 13286) ...... 10619 13286) ...... 10619 12793 (Amended by:

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13286) ...... 10619 2472...... 10953 12 CFR 31...... 10161 12807 (Amended by: 53...... 10161 6 CFR Proposed Rules: 13286) ...... 10619 203...... 11010 54...... 10161 12824 (Amended by: 9...... 10912 56...... 10161 13286) ...... 10619 15...... 10886 14 CFR 301...... 10161, 11739 12830 (Amended by: 17...... 10892 Ch. 1 ...... 10145 602...... 10161, 11739 13286) ...... 10619 21...... 10904 25...... 9854, 10365 Proposed Rules: 12835 (Amended by: 39 ...... 10147, 10149, 10152, 1...... 10190 13286) ...... 10619 7 CFR 10154, 10156, 10583, 10653, 12870 (Amended by: 27 CFR 301...... 11311 11467, 11469, 11967, 11971 13286) ...... 10619 318...... 11967 47...... 10316 4...... 10076 12906 (Amended by: 319...... 9851 71 ...... 10367, 10369, 10654, 5...... 10076 13286) ...... 10619 911...... 10345 11736, 11738 7...... 10076 12919 (Amended by: 944...... 10345 97...... 10962, 10963 13286) ...... 10619 28 CFR 959...... 11463 Proposed Rules: 12977 (Amended by: 982...... 11733 540...... 10656 13286) ...... 10619 21...... 11475, 11759 984...... 10347 39 ...... 9947, 9950, 9951, 9954, Proposed Rules: 12978 (Amended by: Proposed Rules: 28...... 11481 13286) ...... 10619 10185, 10188, 10413, 10416, 340...... 11337 11014, 11015, 11342, 11476, 12982 (Amended by: 930...... 9944 29 CFR 13286) ...... 10619 11479, 11760, 11762, 11764, 932...... 11340 11999 1404...... 10659 12985 (Amended by: 985...... 11751 13286) ...... 10619 43...... 11475, 11759 30 CFR 1218...... 11756 145...... 11475, 11759 12989 (Amended by: 1230...... 11996 18...... 10965 13286) ...... 10619 1405...... 9944 15 CFR 948...... 10178 13011 (Amended by: 1499...... 9944 Proposed Rules: 13286) ...... 10619 740...... 10586 70...... 10784 13076 (Amended by: 743...... 10586 8 CFR 72...... 10940 13286) ...... 10619 772...... 10586 1...... 10922 75...... 10784, 11770 13100 (Amended by: 774...... 10586 2...... 10922 90...... 10784 13286) ...... 10619 103...... 10922 16 CFR 950...... 10193 13112 (Amended by: 217...... 10954 13286) ...... 10619 304...... 9856 235...... 10143 31 CFR 13120 (Amended by: 239...... 10922 103...... 10965 13286) ...... 10619 17 CFR 1001...... 10349 560...... 11741 13130 (See: 13286)...... 10619 Proposed Rules: 1003...... 10349 575...... 11741 13133 (Amended by: 4...... 12001 1101...... 10349 13286) ...... 10619 Proposed Rules: 1103...... 10349 13154 (Amended by: 18 CFR 103...... 12155 1205...... 10349 13286) ...... 10619 375...... 9857 1208...... 10349 32 CFR 13165 (Amended by: 388...... 9857 1209...... 10349 13286) ...... 10619 171...... 11633 1212...... 10349 13212 (Amended by: 19 CFR 199...... 11973 1216...... 10349 13286) ...... 10619 1235...... 10349 Proposed Rules: 33 CFR 13223 (Amended by: 1236...... 10349 181...... 12011 13286) ...... 10619 52...... 9882 1238...... 10349 13228 (Amended by: 20 CFR 117...... 9890 1239...... 10349 13286) ...... 10619 401...... 11974 1240...... 10349 625...... 10932 13231 (Amended by: 1241...... 10349 36 CFR 13286) ...... 10619 21 CFR 1244...... 10349 13254 (Amended by: 704...... 11974 1245...... 10349 165...... 9873 13286) ...... 10619 Proposed Rules: 1246...... 10349 610...... 10157 13257 (Amended by: 7...... 11019 1249...... 10349 1310...... 11471 13286) ...... 10619 219...... 10421, 12155 1270...... 10349 Proposed Rules: 13260 (Amended by: 1274a...... 10349 1...... 10668 38 CFR 13286; Revoked by: 1292...... 10349 111...... 10418, 12158 13286, eff. 3/31/ 17...... 11977 1337...... 10349 112...... 12158 03) ...... 10619 165...... 9955 40 CFR 13271 (Amended by: 9 CFR 52 ...... 9892, 10966, 10969, 13286) ...... 10619 22 CFR 13274 (Amended by: 50...... 10361 11316, 11977 13286) ...... 10619 92...... 10667 Proposed Rules: 62 ...... 10659, 10661, 10663, 13276 (Amended by: Proposed Rules: 211...... 9944 11472, 11978 94...... 11998 63...... 11745 13286) ...... 10619 24 CFR 13284 (See: 13286)...... 10619 317...... 11008 70...... 10969 13286...... 10619 327...... 11008 92...... 10160 82...... 10370 13287...... 10619 906...... 11714 122...... 11325 10 CFR 13288...... 11457 Proposed Rules: 180 ...... 10370, 10377, 10972, 40...... 10362 203...... 11730 10983, 11330 5 CFR 150...... 10362 3285...... 11448 271...... 11981 110...... 10666 430...... 10957 3286...... 11452 439...... 12266 Ch. XIV ...... 10953 Proposed Rules Proposed Rules: 2416...... 10953 40...... 10411 26 CFR Ch. I...... 10675, 12013 2424...... 10953 150...... 10411 1 ...... 10161, 10655, 11313 51...... 12014 2429...... 10953 430...... 11009 20...... 10161 52 ...... 11022, 11023, 12014 2471...... 10953 490...... 10320 25...... 10161 62 ...... 10680, 10681, 11483,

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11484, 12015 70...... 11023 136...... 11770, 11791 228...... 11488 271...... 12015 439...... 12776 42 CFR 412...... 10987 Proposed Rules: 83...... 11924 412...... 10421, 11234 43 CFR Proposed Rules: 4100...... 9964, 11345 44 CFR 61...... 9895 64...... 9897 206...... 9899 45 CFR 162...... 11445 47 CFR 0...... 11747 2...... 10179, 11986 25...... 11986 73 ...... 10388, 10664, 10665, 11335, 11993 90...... 10179 95...... 9900 Proposed Rules: 15...... 12015 54...... 10430, 12020 73 ...... 10681, 10682, 10683, 11345, 12023, 12024 48 CFR 1825...... 11747 49 CFR 1...... 10988 107...... 11748 190...... 11748 191...... 11748 192...... 11748 193...... 11748 195...... 11748 198...... 11748 199...... 11748 219...... 10108 225...... 10108 240...... 10108 1540...... 9902 Proposed Rules: 192...... 9966 50 CFR 17...... 10388 300...... 10989 622...... 10180, 11003 648...... 9905, 10181 660...... 11182 679 .....9902, 9907, 9924, 9942, 11004, 11994 Proposed Rules: 229...... 10195 600 ...... 9967, 11501, 11793 622...... 11794 648 ...... 9968, 11023, 11346

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REMINDERS Alaska; fisheries of promulgation; various by 3-17-03; published 1- The items in this list were Exclusive Economic States: 14-03 [FR 03-00665] editorially compiled as an aid Zone— California; comments due by INTERIOR DEPARTMENT to Federal Register users. Pacific cod; comments 3-17-03; published 2-13- National Park Service Inclusion or exclusion from due by 3-20-03; 03 [FR 03-03417] Special regulations: published 2-18-03 [FR this list has no legal ENVIRONMENTAL Glen Canyon National 03-03589] significance. PROTECTION AGENCY Recreation Area, UT and Atlantic highly migratory AZ; personal watercraft species— Air quality implementation use; comments due by 3- Atlantic tunas, swordfish, plans; approval and RULES GOING INTO 18-03; published 1-17-03 and sharks; comments promulgation; various EFFECT MARCH 13, 2003 [FR 03-01157] due by 3-17-03; States: California; comments due by JUSTICE DEPARTMENT COMMERCE DEPARTMENT published 11-15-02 [FR 02-29086] 3-17-03; published 2-13- Drug Enforcement National Oceanic and Atlantic tunas, swordfish, 03 [FR 03-03418] Administration Atmospheric Administration and sharks, and Atlantic Rhode Island; comments Schedules of controlled Fishery conservation and billfish; exempted fishing due by 3-17-03; published substances: management: activities; comments 2-14-03 [FR 03-03698] Anabolic steroid products; Alaska; fisheries of due by 3-17-03; FEDERAL comments due by 3-17- Exclusive Economic published 1-10-03 [FR 03; published 1-15-03 [FR Zone— COMMUNICATIONS 03-00520] COMMISSION 03-00772] Pollock; published 2-11-03 Magnuson-Stevens Act Radio services, special: PERSONNEL MANAGEMENT LIBRARY OF CONGRESS provisions— OFFICE Private land mobile National Film Preservation Domestic fisheries; services— Employee responsibilities and Board; National Film exempted fishing permit conduct; comments due by Registry; published 3-13-03 applications; comments Dedicated short-range 3-17-03; published 1-15-03 due by 3-17-03; communication services VETERANS AFFAIRS [FR 03-00818] published 2-28-03 [FR in 5.850-5.925 GHz DEPARTMENT PERSONNEL MANAGEMENT 03-04681] band; comments due by OFFICE Medical benefits: Domestic fisheries; 3-17-03; published 1-15- Non-VA physicians— exempted fishing permit 03 [FR 03-00812] Retirement: Retirement coverage and Allowance for drug applications; comments HEALTH AND HUMAN service credit elections for prescriptions to be filled due by 3-17-03; SERVICES DEPARTMENT by non-VA pharmacies current and former published 2-28-03 [FR Food and Drug in state homes under nonappropriated fund 03-04680] Administration VA contracts; published National standard employees; comments 3-13-03 guidelines; revision; Medical devices: due by 3-17-03; published comments due by 3-17- General and plastic surgery 1-16-03 [FR 03-00819] devices— COMMENTS DUE NEXT 03; published 2-14-03 SECURITIES AND WEEK [FR 03-03758] Eight surgical suture EXCHANGE COMMISSION ENVIRONMENTAL devices; special control Practice and procedure: PROTECTION AGENCY designation; comments Administrative proceedings; AGRICULTURE due by 3-19-03; DEPARTMENT Air pollutants, hazardous; timeliness; comments due national emission standards: published 12-19-02 [FR by 3-21-03; published 2- Commodity Credit Chemical recovery 02-31991] 19-03 [FR 03-03915] Corporation combustion sources at HOMELAND SECURITY Loan and purchase programs: TRANSPORTATION kraft, soda, sulfite, and DEPARTMENT DEPARTMENT Conservation Security stand-alone semichemical Coast Guard Computer reservation systems, Program; comments due pulp mills; comments due carrier-owned; expiration by 3-20-03; published 2- Ports and waterways safety: by 3-20-03; published 2- date extension; comments 18-03 [FR 03-03782] 18-03 [FR 03-03701] Chicago Captain of Port Zone, IL; safety zones; due by 3-16-03; published AGRICULTURE ENVIRONMENTAL comments due by 3-17- 12-9-02 [FR 02-30951] DEPARTMENT PROTECTION AGENCY 03; published 2-14-03 [FR Privacy Act; implementation; Natural Resources Air pollutants, hazardous; 03-03739] comments due by 3-17-03; Conservation Service national emission standards: St. Thomas, U.S. Virgin published 1-15-03 [FR 03- Loan and purchase programs: Chemical recovery 00828] combustion sources at Islands; security zone; Conservation Security TRANSPORTATION kraft, soda, sulfite, and comments due by 3-21- Program; comments due DEPARTMENT stand-alone semichemical 03; published 2-19-03 [FR by 3-20-03; published 2- 03-03978] Federal Aviation 18-03 [FR 03-03782] pulp mills; comments due by 3-20-03; published 2- INTERIOR DEPARTMENT Administration AGRICULTURE 18-03 [FR 03-03702] Fish and Wildlife Service Air carrier certification and DEPARTMENT operations: ENVIRONMENTAL Endangered and threatened Administrative practice and Transponder continuous PROTECTION AGENCY species: procedure: operation; comments due Air quality implementation Mountain plover; comments Civil rights discrimination plans; approval and by 3-17-03; published 1- complaints; adjudication; due by 3-21-03; published 14-03 [FR 03-00685] promulgation; various 2-21-03 [FR 03-04152] comments due by 3-17- States: TRANSPORTATION 03; published 2-14-03 [FR California; comments due by INTERIOR DEPARTMENT DEPARTMENT 03-03565] 3-17-03; published 2-13- Minerals Management Federal Aviation COMMERCE DEPARTMENT 03 [FR 03-03416] Service Administration National Oceanic and ENVIRONMENTAL Outer Continental Shelf; oil, Airworthiness directives: Atmospheric Administration PROTECTION AGENCY gas, and sulfur operations: Bell; comments due by 3- Fishery conservation and Air quality implementation Documents incorporated by 17-03; published 1-15-03 management: plans; approval and reference; comments due [FR 03-00328]

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TRANSPORTATION Embraer Model 170-100 public hearing; comments (phone, 202–512–1808). The DEPARTMENT and 107-200 airplanes; due by 3-19-03; published text will also be made Federal Aviation comments due by 3-20- 12-19-02 [FR 02-31859] available on the Internet from Administration 03; published 2-3-03 VETERANS AFFAIRS GPO Access at http:// Airworthiness directives: [FR 03-02423] DEPARTMENT www.access.gpo.gov/nara/ nara005.html. Some laws may Boeing; comments due by Colored Federal airways; Medical benefits: not yet be available. 3-17-03; published 1-29- comments due by 3-17-03; Enrollment; hospital and 03 [FR 03-01957] published 1-30-03 [FR 03- outpatient care provided 02189] H.R. 395/P.L. 108–10 TRANSPORTATION to veterans subpriorities of VOR and colored Federal DEPARTMENT priority categories 7 and 8 Do-Not-Call Implementation airways; comments due by and annual enrollment Federal Aviation 3-17-03; published 1-30-03 Act (Mar. 11, 2003; 117 Stat. Administration decision; comments due 557) [FR 03-02190] by 3-18-03; published 1- Airworthiness directives: TRANSPORTATION 17-03 [FR 03-01201] Last List March 10, 2003 Honeywell; comments due DEPARTMENT by 3-17-03; published 1- Research and Special 15-03 [FR 03-00643] Programs Administration LIST OF PUBLIC LAWS TRANSPORTATION Hazardous materials: Public Laws Electronic DEPARTMENT This is a continuing list of Miscellaneous amendments; public bills from the current Notification Service Federal Aviation comments due by 3-17- session of Congress which (PENS) Administration 03; published 1-21-03 [FR have become Federal laws. It Airworthiness directives: 03-00580] may be used in conjunction McDonnell Douglas; TREASURY DEPARTMENT with ‘‘PLUS’’ (Public Laws PENS is a free electronic mail comments due by 3-17- Alcohol, Tobacco and Update Service) on 202–741– notification service of newly 03; published 1-30-03 [FR Firearms Bureau 6043. This list is also enacted public laws. To 03-02095] Alcohol; viticultural area available online at http:// subscribe, go to http:// designations: www.nara.gov/fedreg/ New Piper Aircraft, Inc.; listserv.gsa.gov/archives/ plawcurr.html. comments due by 3-21- Red Hill, OR, and Red Hills, publaws-l.html 03; published 1-27-03 [FR CA; comments due by 3- The text of laws is not 03-01679] 17-03; published 1-16-03 published in the Federal Note: This service is strictly [FR 03-00847] Pilatus Aircraft Ltd.; Register but may be ordered for E-mail notification of new comments due by 3-21- TREASURY DEPARTMENT in ‘‘slip law’’ (individual laws. The text of laws is not 03; published 2-12-03 [FR Internal Revenue Service pamphlet) form from the available through this service. 03-03449] Income taxes: Superintendent of Documents, PENS cannot respond to Airworthiness standards: Expenditures deduction and U.S. Government Printing specific inquiries sent to this Special conditions— capitalization; guidance; Office, Washington, DC 20402 address.

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